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Nifty PSU Bank index surges on report govt may hike FPI limit
Shares of state-owned banks were selling like hot cakes on Dalal Street after CNBC Awaaz reported that the government is mulling an increase in foreign investment limit in such lenders to 74 percent from current 20 percent.
The move if implemented is likely to immensely help the government’s efforts to privatise some public sector banks in the next fiscal year. Last year, the government had announced its intention to bring its stake in some state-owned banks to below 50 percent.
The Nifty PSU Bank index rose 3.3 percent with Indian Overseas Bank, Bank of Baroda, and Central Bank of India leading the gains.
European Markets Updates
ICICI Securities on Avenue Supermarts: Despite trading at premium valuations, Avenue Supermarts has been a consistent compounder with stock price increasing at 46% CAGR in last three years. D-Mart is India’s most profitable low cost retailer and a strong play on India’s retail growth story and a key beneficiary of unorganised to organised segment shift. We maintain hold rating on the stock with a revised target price target price of Rs 5260 i.e. 6.2x FY24E EV/sales.
GNA Axles Q3: Consolidated net profit was down 37.4% at Rs 16.7 crore against Rs 26.6 crore (YoY). Consolidated revenue was up 9.1% at Rs 301.3 crore against Rs 276 crore (YoY). Consolidated EBITDA was down 20.1% at Rs 38.5 crore against Rs 48.1 crore (YoY). Consolidated EBITDA margin at 12.8% against 17.4% (YoY).
Market update at 2 PM: Sensex is up 536.39 points or 0.90% at 60281.04, and the Nifty jumped 160.40 points or 0.90% at 17973.10.
L&T Construction gets contract for its Heavy Civil Infrastructure Business
The construction arm of Larsen & Toubro has secured an order from the esteemed National High Speed Rail Corporation Limited (NHSRCL), to design and construct Package No. – MAHSR-C-5 of the Mumbai Ahmedabad High Speed Rail Project, the first High Speed Rail corridor being implemented in the country.
Larsen & Toubro was quoting at Rs 1,930.70, up Rs 25.95, or 1.36 percent.
Nish Bhatt, Founder & CEO, Millwood Kane International:
The price for the Sovereign Gold Bond tranche-9 has been fixed at 4786/gm. SGB is an efficient way for investors looking to take exposure in gold. There is no storage cost, taxes as is the case in buying physical gold. Paper gold has a higher redemption value and can be easily used to take loans against it. SGB comes with a 2.5% coupon attached and tax advantage for its investors.
The scheme has been a huge success for the government, as it is evident in the fact that the government managed to raise over Rs 32,000 crores since its inception in 2015.
Currently, gold prices are trading near a 2-month low. Gold prices are almost Rs 9000/10 gm down from their peak witnessed in 2020. The weakness is mainly due to the minutes of the US Fed that indicated a faster rate hike and also a reduction in bond buying than earlier estimated.
Going forward, the pace at which the global central banks will unwind their monetary position, movement of the US dollar will guide gold prices in the year 2022.
Macquarie view on Paytm
Shares of Paytm parent One97 Communications fell more than 2 percent after Macquarie Securities India suggested that the company’s future earnings growth may be worse than it had earlier forecast.
The brokerage firm slashed its price target for the stock by 25 percent to Rs 900 from Rs 1,200 earlier, implying a further downside of 28 percent from the January 7 closing. Macquarie retained its ‘underperform’ rating on the stock.
Macquarie’s pessimism for the company comes when the stock has already fallen more than 38 percent from its high of Rs 1,955 on November 18, which followed a disastrous debut on Dalal Street.
Indian inflation likely accelerated to a six-month high in December: Poll
Higher telecommunications charges, along with a comparatively low base one year ago, likely drove Indian retail inflation to a six-month high in December, a Reuters poll found, keeping alive expectations for an interest rate rise by mid-year.
The January 4-7 survey of 41 economists showed Indian retail inflation rose to 5.80% last month from 4.91% in November, spending more than two years above the Reserve Bank of India’s medium-term target of 4.0%.
If realised, it would be the highest since June 2021.
Estimates ranged between 4.70% and 6.30%, including seven respondents who predicted it would be above the RBI’s upper tolerance limit of 6.0%. The report is due to be released on Wednesday at 1200 GMT.
Market at 1 PMBenchmark indices were trading higher with Nifty around 17950 level led by the IT, bank, auto and realty stocks.The Sensex was up 481.69 points or 0.81% at 60226.34, and the Nifty was up 143.90 points or 0.81% at 17956.60. About 2474 shares have advanced, 885 shares declined, and 105 shares are unchanged.
BSE Information Technology index added 1 percent led by the Xchanging Solutions, Kellton Tech Solutions, Intellect Design Arena
