On Tuesday, Sensex and Nifty gained over 2% supported by IT, pharma and metal stocks. While the Sensex gained 1128 points and settled above 50,000, the Nifty also gained 338 points but settled around the 14,845 levels. The Nifty gainers included UPL, JSW Steel, Tata Steel Shree Cements, Divis Labs etc. However, stocks like M&M, Axis Bank, Bharti Airtel and Hindalco came under bit of pressure. Mid-caps and small caps also gained, albeit less than the large cap indices. The markets celebrated an end to the Suez crisis but chose to ignore any ripple effects of the hedge fund default. Asian markets were also up.
The new issues market had its best year in FY21, notwithstanding the pandemic, raising a total of Rs.188,900 crore during the year. That is better than the Rs.175,000 crore raised in FY18. There was a sharp improvement in the qualified institutional placements this year at Rs.78,731 crore. Out of the sum of Rs.188,900 crore raised, nearly 73% was raised through fresh capital raising and the balance 27% via offers for sale. Some of the drivers were a revival in the IPO market, solid interest from retail & HNIs and a sharp revival in the REIT/INVIT market during the year. QIP fund raising of Rs.78,731 crore was concentrated with banks, NBFCs and realty companies accounting for 84% of the total QIP funds raised. Indigo paints received the maximum retail applications at 25.88 lakhs followed by MTAR and Mazagon.
One of the largest benchmark index service providers, FTSE Russell, placed Indian government bonds on the watchlist for likely inclusion in one of its major global debt indices. The Indian government has been lobbying with FTSE Russell for the last few quarters and this move could open the gates for billions of dollars of passive inflows into debt. FTSE Russell is considering Indian government bonds for inclusion in the FTSE Emerging Markets Government Bond Index. One of the conditions for such inclusion was that India had to put efforts to liberalize India’s sovereign bond market. This could attract $10 billion in debt.
Bharat Biotech, the creator of Covaxin, tied up with CSIR for technologies and platforms for novel vaccines, drugs and raw materials. The idea is to build vaccine self-sufficiency in India to the extent possible. Many of the preservatives for vaccines are imported from Germany while specific raw material are brought in from the US. The venture will focus on chemicals like Beta propiolactone, Thimersol and Microcarriers, which are generally in short supply. The idea is that if such a steady supply of raw materials was available then there would be opportunities to create technologies for developing vaccines for various diseases.
BHEL has bagged an order for sulphur recovery unit from IOCL against international bidding. This order marks the entry of BHEL into the downstream oil and gas process package business and reduces its reliance on coal-based businesses. The order value is estimated at around Rs.400 crore and entails setting up a 525 tonnes per day or TPD Sulphur Recovery Unit at the Paradip Refinery in Odisha; owned and operated by IOCL. The scope of work includes project management, residual process design, detailed engineering, procurement, manufacturing, supply, testing, erection, construction and commissioning.
India’s second largest digital brokerage firm, Upstox, is exploring public listing in the US market via SPAC route. A special purpose acquisition vehicle or SPAC is a blank cheque firm with no commercial operations but solely formed to raise money and invest in a target company. In the year 2020 alone, Wall Street raised over $80 billion via the SPAC route. Compared to traditional IPOs, the SPAC method is quicker, cheaper and less risky. Upstox expects better valuations in the US market through the SPAC route. Upstox has been recently riding a wave of new age millennial investors who have formed a beeline for equities. The ball-park valuation is placed at $1 billion. Upstox currently has around 28 lakh customers and expects to touch 60 lakh customers by the end of 2021. Tiger Global and Ratan Tata are among its early backers.