Street Signs: FPIs dial back wagers, grey mkt premiums for IPOs, and more

FPIs dial-back wagers: Cut back on long positions

Foreign portfolio investors (FPIs) have scaled back their bullish bets, nearly triggering a 500-point fall in the Nifty50 Index. From an intraday high of 18,888 on December 1, the index declined to a low of 18,410 on Friday, before finishing at 18,497. “This correction is mainly due to profit-booking. We have seen the unwinding of long positions by FPIs in the index futures segment. Their long-short ratio has reduced from about 76 per cent to 60 per cent since December 1,” observes Ruchit Jain, lead research analyst, 5Paisa. “The immediate support for the Nifty in the week ahead is placed between 18,550 and 18,380. If this support range is breached, we could see the index slip towards 18,100,” he adds.

T&D stocks power up for a rerating

Stocks of transmission and distribution (T&D) players could benefit from the power ministry’s plan for 500-gigawatt renewable capacity by 2029-30. The fast-tracking of the entire implementation provides a rerating trigger for the sector, say analysts. Moreover, T&D companies have witnessed strong order inflows across segments in the past few quarters. A strong order book provides healthy revenue visibility. A decline in commodity prices is likely to start reflecting on margin improvement from 2023-24 onwards, observe analysts. KEC International and Kalpataru Power Transmission are likely to be significant beneficiaries, they add.

Modest grey market premiums for new IPOs

The grey market premiums (GMPs) for the three initial public offerings (IPOs) that hit the market this week are less than 10 per cent apiece. According to sources, the GMPs for Sula Vineyards (Sula) and Landmark Cars (Landmark) are about 9 per cent each, while that for Abans Holdings (Abans) is 5 per cent. “The recent volatility in the market has weighed on sentiment. Also, the recent listing of Dharmaj Crop Guard was below expectation,” says a primary market expert. The IPOs of wine producer Sula, automotive dealership chain Landmark, and financial services provider Abans will mop up a little over Rs 1,850 crore.