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Benchmarks at day's low; Vedanta tumbles as delisting fails

Capital Market 

Benchmarks reversed gains and hit the day's low in afternoon session. The Nifty fell below the crucial 11,900 mark. Selling was seen across the board with metals, PSU banks and realty stocks losing the most. Lack of concrete stimulus package from the government dented investor sentiments.

At 13:32 IST, the barometer index, the S&P BSE Sensex, lost 84.6 points or 0.22% at 40,424.08. The Nifty 50 index slipped 37.25 points or 0.32% at 11,876.10.

In the broader market, the S&P BSE Mid-Cap index and the S&P BSE Small-Cap index lost 0.81% and 0.63% respectively. Both these indices underperformed the Sensex.

FM's Media Address:

FM Nirmala Sitharaman is addressing a press conference on economic issues. The government will issue a special interest-free 50-year loan to states for Rs 12,000 crore capital expenditure. Rs 200 crore each will be allocated to 8 North-East states and Rs 450 crore each to Uttarakhand and Himachal Pradesh. Rs 7,500 crore will given to the remaining states.

FM said special festival advance scheme is being revived as a one-time measure. All central government employees can now get interest-free advance of Rs 10,000, recoverable in maximum 10 installments.

"We estimate that the measures announced today, for boosting consumer spending and capital expenditure, will boost demand by Rs 73,000 crores, to be spent by March 31, 2021," FM said.

Mumbai Power Outage:

Mumbai faced a power outage on Monday morning. The Brihanmumbai Electric Supply and Transport (BEST) Electricity, twitted that the electric supply in Mumbai was interrupted due to TATA's incoming electric supply failure. Power has now been restored to many areas of the city.

Gainers & Losers:

Power Grid Corporation (up 2.41%), ITC (up 2.14%), Infosys (up 1.74%), HCL Tech (up 1.36%) and Asian Paints (up 1.29%) were top gainers in Nifty 50 index.

JSW Steel (down 3.72%), Tata Motors (down 2.31%), GAIL (down 2.33%), HDFC Life (down 1.71%) and SBI Life (down 1.74%) were top losers in Nifty 50 index.

New Listings:

Shares of UTI Asset Management Company were trading at Rs 512.50 at 13:17 IST on the BSE, a discount of 7.49% over the initial public offer price of Rs 554. The stock was listed at Rs 490.25, a discount of 11.51% to the initial public offer (IPO) price. So far the stock hit a high of Rs 530 and low of 490.25. On the BSE, 3.58 lakh shares were traded on the counter so far. The IPO of UTI Asset Management Company (UTI AMC) received bids for 6.31 crore shares as against 2.73 crore shares on offer. The issue was subscribed 2.31 times. The issue opened for bidding on Tuesday, 29 September 2020 and closed on Thursday, 1 October 2020. The price band for the IPO was set at Rs 552-554 per share.

Shares of Mazagon Dock Shipbuilders were trading at Rs 177 at 10:25 IST on the BSE, a premium of 22.07% over the initial public offer price of Rs 145. The stock was listed at Rs 216.25, a premium of 49.14% to the initial public offer (IPO) price. So far, the stock hit a high of Rs 216.65 and low of 176.5.

On the BSE, 19.02 lakh shares were traded on the counter so far. The IPO of Mazagon Dock Shipbuilders received bids for 481.64 crore shares as against 3.05 crore shares on offer. The issue was subscribed 157.41 times. The issue opened for bidding on 29 September 2020 and closed on 1 October 2020. The price band for the IPO was set at Rs 135-145 per share.

Stocks in Spotlight:

Vedanta slumped 18.18% to Rs 99.9 after the mining major on 10 October 2020 said that its delisting offer is deemed to have failed as per terms of delisting regulations. A total of 125.47 crore shares were validly tendered by public shareholders, which is less than the minimum number of offer shares required to be accepted by the promoters in order for the delisting offer to be successful. The promoters sought to buy out 169.73 crore shares or 47.67% stake held by the public to delist the firm. Accordingly, the promoter group will not acquire any equity shares tendered by the public shareholders in the delisting offer and the equity shares of the company will continue to remain listed on the stock exchanges. Vedanta's American Depositary Shares (ADS) will continue to remain listed on the New York Stock Exchange (NYSE).

Shilpa Medicare slumped 7.65% to Rs 503.10 after the company announced that its Jadcherla facility in Telangana received a warning letter on 9 October 2020 from the US drug regulator. The company said that it will be engaging with the agency and is fully committed in resolving this issue at the earliest. It believes that the warning letter will have minimum impact of disruption of supplies and the existing revenues from operations of this facility.

GTPL Hathway jumped 5.97% to Rs 123.30 after the company posted a 58.94% rise in consolidated net profit to Rs 45.30 crore in Q2 September 2020 from Rs 28.50 crore registered in Q2 September 2019. Total income stood at Rs 584.70 crore in Q2 September 2020, registering a 6.75% decline from Rs 627.05 crore recorded in Q2 September 2019. The company's CATV subscription revenue rose 3% year on year (YoY) to Rs 267.7 crore. Broadband revenue stood at Rs 67 crore, rising 68% YoY.

PVR fell 1.29%. The board of the multiplex chain operator on 9 October 2020 approved raising Rs 50 crore through allotment of 500 non-convertible debentures (NCDs). PVR's board approved allotment of 500 secured redeemable non-cumulative listed rated non-convertible principal protected market linked debentures (NCDs) of face value of Rs 10 lakh each, at par, aggregating up to Rs 50 crore, fully paid on a private placement basis. The said NCDs carry tenure of 15 months and the due date of redemption is 7 January 2022.

Global Markets:

European markets traded with tepid gains while Most Asian stocks advanced on Monday.

The US stock market finished higher for third straight session on Friday, 9 October 2020, as investors cling to hope that a new round of coronavirus relief aid can be agreed upon between the White House and Congress for struggling US businesses and households. Meanwhile, growing expectations of a Democratic victory in next month's presidential election also supported risk sentiments.

United States President Donald Trump tweeted: "Covid Relief Negotiations are moving along. Go Big!" The media reported that the White House is preparing a $1.8 trillion stimulus proposal.

The Federal Reserve and US lawmakers have spent trillions of dollars on various measures to keep the economy afloat during the pandemic. Earlier this year, the Fed launched an open-ended bond-buying program and Trump signed a $2.2 trillion package that included enhanced unemployment benefits and direct payments to Americans.

Meanwhile, the second presidential debate between President Donald Trump and Democrat Joe Biden is officially off. The decision was made a day after the commission announced the debate would take place virtually because Trump had contracted the coronavirus. The third debate, scheduled for October 22 in Nashville, Tennessee, is still on.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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First Published: Mon, October 12 2020. 13:28 IST
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