Street Signs: Nifty's new conquest, SME bankers under regulatory scalpel

The 25K wall falls:Nifty’s new conquest 

The Nifty 50 index broke new ground, closing “decisively” above the 25,000 mark for the first time since September 2024. Market observers interpret this as a bullish signal, potentially paving the way for the index to reach record highs. Devarsh Vakil, head of prime research at HDFC Securities, noted that Nifty’s breakout above 25,000 marks a positive short term trend. Immediate resistance is at 25,222, while support has shifted to 24,900. Dhupesh Dhameja, derivatives research analyst at Samco Securities, added that a firm close above 25,250 could boost upward momentum, targeting 25,500. Unless the index breaches 24,700, pullbacks are likely to attract buyers. The Nifty closed at 25,112, just 4 per cent below its record high. 

‘Re IPO’: The sequel no one saw coming 

The current equity deal momentum has led market experts to coin a new term — ‘re IPO’. This refers to the sale of a large block of shares after the lock up period expires. A recent example is Vishal Mega Mart, where promoter Samayat Services sold a 20 per cent stake, raising over ₹10,000 crore. Investment bankers attribute this trend to abundant liquidity and investors’ willingness to buy significant stakes in well performing companies. “A virtuous liquidity cycle is emerging,” observes a banker. “Private equity firms acquire unlisted firms, sell stakes during initial public offerings, and further divest after listing, redeploying funds into new ventures.” 

 

SME bankers under the regulatory scalpel 

Amid growing scrutiny over merchant bankers’ lapses in small and medium enterprise (SME) initial public offerings, the market regulator has introduced stricter guidelines to enhance risk assessment and transparency. Under the new rules, merchant bankers must thoroughly evaluate and disclose critical risks — including sudden fluctuations in revenue or profits, production activity, and auditor concerns. Any changes in financial information will require detailed justification. In addition, bankers must provide a rationale for unusual financial patterns, such as disproportionate management compensation, unexpected other income, high marketing expenditures, or low returns on advertisement spends.