Sensex opens flat, Nifty hovers around 8950; Kotak Bank gains 2%
Wed Mar 08 2017
Ramesh Sridharan (876 articles)

Sensex opens flat, Nifty hovers around 8950; Kotak Bank gains 2%

10:12 am IPO subscription:The initial public offering of Music Broadcast, a Jagran group firm that runs Radio City FM channel, was oversubscribed 2.19 times on the second day of the issue on Tuesday. The IPO, which will close today, received bids for 2,29,35,240 shares against the total issue size of 1,04,80,784 shares, data available with the NSE.

The portion set aside for qualified institutional buyers (QIBs) was oversubscribed 1.06 times, while that of non institutional investors 24 per cent.

Retail investors category was oversubscribed 3.66 times.

Music Broadcast IPO comprises fresh issue of shares up to Rs 400 crore and an offer for sale of up to 26.59 lakh scrips. It has fixed a price band of Rs 324-333.

10:00 am Market Check: Benchmark indices continued to be lacklustre in morning trade as investors awaited exit polls due tomorrow after end of last phase of voting Uttar Pradesh elections today. The 30-share BSE Sensex was down 18.14 points at 28,981.42 and the 50-share NSE Nifty fell 2.05 points to 8944.85. The market breadth was almost balanced as about 1026 shares advanced against 905 declining shares on the BSE.

HDFC, ITC, Sun Pharma, Asian Paints, TCS and Lupin were leading contributors to Sensex’s gains while Infosys, Reliance Industries, Tata Motors, Hindalco, ONGC ICICI Bank and Maruti were under pressure.

9:55 am Buzzing: Kotak Mahindra Bank added nearly 3 percent intraday following reports of stake sale to Canadian pension fund.

Uday Kotak is reportedly in discussions for a sale of over 3 percent stake in the bank to Caisse de Depot et Placement du Quebec (CPDQ). The stake that Kotak is looking to sell is worth Rs 5,400 crore as of March 7, 2017 closing price.

The stock saw heavy volumes as 2.7 crore shares worth Rs 2,274 crore traded on the BSE at a current market price (CMP) of Rs 824 per share.

The bank was in the news last month for reportedly approaching the government seeking a merger with Axis Bank, sources had told CNBC-TV18.

9:45 am JPMorgan on Ambuja: While assigning overweight rating to Ambuja Cements with a target price of Rs 250 post company’s annual report, JPMorgan says announcement of greenfield expansion stands as a key positive for the company.

ACC-Ambuja restructuring got its FIPB nod and deal conclusion in CY16 is a step forward towards realising potential synergy gains over the medium term, it believes.

JPMorgan estimated ex-south industry growth to be lower at sub 2 percent levels, implying that the market share loss for Ambuja is not as severe as market perception. Capacity utilisation has come down to 71 percent levels thereby providing scope for robust volume growth as industry demand trends recover, it says.

Per Ambuja Cements, it feels CY17 is likely to be yet another challenging year though medium term outlook remains positive on the back of government infra focus and affordable housing policies.

9:30 am IPO: Avenue Supermarts, the operator of retail chain D-Mart, has opened its Rs 1,870 crore initial public offering for subscription today.

The company raised nearly Rs 561 crore by allotting shares to anchor investors ahead of its IPO on Tuesday. The price band for the IPO has been set at Rs 295-299. It will close on March 10.

The company has allotted little over 1.87 crore shares to 35 anchor investors at the upper price band of Rs 299 apiece.

Government of Singapore, JP Morgan, Smallcap World Fund, New World Fund, Fidelity, T Rowe Price, HDFC MF, Reliance MF, ICICI Prudential MF and SBI MF are among the anchor investors.

Avenue Supermarts will use issue proceeds for various purposes, including loan repayment.

Also read – As D-Mart parent IPO hits Street, here’s all you need to know about it

9:15 am Market Check: The market has opened flat on Wednesday as investors maintained cautious stance ahead of exit polls for assembly elections that will end today with last phase in Uttar Pradesh.
The 30-share BSE Sensex was down 20.72 points at 28978.84 and the 50-share NSE Nifty fell 3.90 points to 8943. About 467 shares advanced against 239 declining shares on the BSE.

Hero Motocorp, Cipla, ONGC, Asian Paints, Tata Steel, Kotak Mahindra Bank and Bank of Baroda were early gainers while Infosys, Reliance Industries, Wipro, Bharti Airtel, Dr Reddy’s Labs, Bharti Infratel, Aurobindo Pharma and Idea Cellular were under pressure.

The Indian rupee has opened higher by 5 paise at 66.62 per dollar versus previous close 66.67.

NS Venkatesh of Lakshmi Vilas Bank says the rupee is expected to take cues from the equity market today and flows from the FPIs.

He expects USD-INR pair to trade within a narrow range of 66.60-66.83/dollar.

The dollar hit a two-month high against a basket of key currencies last week as Federal Reserve officials talked up the chances of a rate hike this month, but the greenback is now sitting in a narrow range with a hike seen mostly as a done deal.

Asian equities were mixed amid mounting geopolitical risks in the region and rising expectations that the Federal Reserve would tighten monetary policy next week.

Ramesh Sridharan

Ramesh Sridharan

Ramesh Sridharan is our Stock Market Correspondent covering events and daily movements of stock markets in Asia. He is based in Mumbai

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