New Delhi, November 26 (IANS) Last week could be dedicated as a special IPO week as we had opened and closed five issues for subscription. They consisted of one PSU and four private issues. Tata Technologies was an all-offer offer while the remaining four were mixed issues with a fresh issue component and an offer component. Markets gained in two of the five sessions, lost in two and were flat in one session. At the end of the week, BSESENEX rose 175.31 points or 0.27 percent to close at 65,970.04 points while NIFTY gained 62.90 points or 0.32 percent to close at 19,794.70 points. In the broader markets, BSE100, BSE200 and BSE500 rose 0.18 percent, 0.20 percent and 0.22 percent, respectively. BSEMIDCAP gained 0.69 percent while BSESMALLCAP gained 0.53 percent. The outperformance of the midcap and smallcap space continues unabated.
The Indian rupee lost 10 paisa or 0.12 percent to close at 83.37 rupees against the US dollar. won in three of the four meetings and lost in one. The Dow rose 442.82 points, or 1.27 percent, to close at 35,390.15 points.
In IPO week, the first issue was PSU renewable energy financing company Indian Renewable Energy Development Agency Limited or IREDA. The issue was subscribed a total of 38.80 times and had 30.92 lakh registrations. The QIB portion was subscribed 104.57 times, the HNI portion was subscribed 24.16 times and the retail portion was subscribed 7.73 times. The total bid was for shares worth Rs 1,827.25 crore and the amount raised excluding anchors was Rs 58,472 crore.
The second issue came from Tata Technologies Limited, the darling of this round, and also captured the imagination of many new investors. The offer for sale was subscribed a total of 69.43 times, with the QIB portion being subscribed 203.41 times, the HNI portion 62.11 times, the retail portion 16.50 times and the shareholder reservation portion 29.20 times. There were 73.58 lakh applications, which in itself is a new record. The issue saw offers for shares worth ₹312.64 crore, equating to ₹156.32 lakh crore.
The third issue was from Flair Writing Instruments Limited which was subscribed a total of 46.68 times, with QIB portion 115.60 times, HNI portion 33.37 times and Retail portion 13.01 times were drawn. There were 17.02 lakh applications and the issue raised subscription of 67.28 crore shares for an amount of Rs 20,454 crore.
The fourth issue was from Gandhar Oil Refinery (India) Limited, which was subscribed a total of 64.07 times, with the QIB portion being subscribed 129 times, the HNI portion 62.23 times and the retail portion 28.95 times. There were 28.47 lakh applications and bids were received for shares worth Rs 136.10 crore worth Rs 23,001 crore.
The latest issue was from Fedbank Financial Services Limited, which was subscribed a total of 2.20 times, with the QIB portion being subscribed 3.51 times, the HNI portion 1.45 times and the retail portion 1.82 times. In total, there were 3.67 lakh applications. The issue attracted bids for 12.30 crore shares at a price of Rs 1,722.18 crore.
Adding all the bids in the five editions and the anchor share of around Rs 2,200 crore, the total fundraising comes to Rs 2,62,179 crore or Rs 2.62 lakh crore. At best, this can be described as a massive fundraising effort that has taken place.
This likely explains why markets refuse to fall. There is enough liquidity to keep the markets from falling or falling, and the P/E ratio is high to keep the markets from rising. I think this pretty much sums up the current mood in the markets.
Next week the markets will have a trading holiday on Monday, followed by the listing of five issues, one on Wednesday, three on Thursday and one on Friday. In between, there are November futures that expire on Thursday, November 30th.
The first to list on Wednesday (November 29) would be IREDA. This was followed by Tata Technologies, Gandhar and FedFina on Thursday and Flair on Friday. The reason for Flair’s listing on Friday is that two issues will be listed on the NSE on Thursday and hence there is no space or place for the listing.
The November future is currently 937.45 points or 4.97 percent above the opening level of the series at 18,857.25 points. With the series still three days away, there’s not much the Bears can do this time. At best they can regain some lost ground. It’s clearly a series the Bulls will take.
The listing of the five stocks would be a great and euphoric moment. If gray market premiums were anything to go by, all but one issue would have a great debut. The controversial question would be how much of the trading day gains they can keep. I strongly believe that the stock listing would erode much of the gains and close below the day’s high. The challenge would be deciding when successful applicants should book their winnings.
Friday would be a crucial day as the five states’ election polls would be broadcast in the evening before the results are announced on Sunday (December 3). Markets would see some movement with exit polls expected late Friday before the close. In any case, there would be a knee-jerk reaction to the survey results on Monday morning and then the markets would be back on track.
The strategy for the week would be to bet on any intraday volatility and keep overnight positions small. The benchmark indices are currently in a strong range and need a clear upward breakout for any significant upward movement. The key levels would be 19,900-19,950 on NIFTY and 66,300-66,450 on BSESENSEX. On the downside, support lies at 19,600-19,650 on NIFTY and 65,350-65,500 on BSESENSEX. There is no reason for this price to break down or up in the coming week. Globally, even the Israel-Hamas conflict has achieved some sort of peace and could be partially resolved in the future.
In summary, in a week with four trading sessions, November futures expiration, and five quotes, you should trade cautiously. The week would end with the results of the state election on Sunday. Even though the flow of news is heavy, markets could remain range-bound this week and react on Monday, suggesting a breakdown or breakout.
Act carefully.
(Arun Kejriwal is the founder of Kejriwal Research and Investment Services. The views expressed are personal)
–IANS
arun/prw
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