Markets nosedive on last trading day

Nifty50: 18,105 ▼ 85 (-0.4%)
Sensex: 60,840 ▼ 293 (-0.4%)

Namaste, friends!

Markets tanked today, but don’t let that cast a shadow over your new year party. Here’s a fact for you to chew on… Of the 248 trading days in 2022, bulls ruled on 124 days. So, keep the faith or as the song goes, “Should auld acquaintance be forgot/ And never brought to mind?/ Should auld acquaintance be forgot/ And the days of auld lang syne…”

• After positive start, market plunge in the last hour.
• 29 companies of NIFTY50 pack decline.
• As per latest data, India’s fiscal deficit reached 59% of the full-year budget estimate.

Among the Nifty sectoral indices, PSU Bank (+1.5%) and Realty (+0.9%) were the top gainers, while FMCG (-0.7%) and Bank (-0.6%) were the top losers.

What’s trending

⭐ Craftsman Automation zooms on new buy

CRAFTSMAN (NSE): 3,492 ▲ 233 (+7.1%)

Craftsman Automation shares soared 13% intraday after the company announced acquisition of a majority stake in DR Axion. The acquisition cost ₹ 375 crore for 76% equity stake. Both the companies operate in the auto component space. The turnover of DR Axion was ₹ 715.9 crore in FY22. That equals over 32% turnover of Craftsman Automation in the same period.

⭐ Indonesia to tighten palm oil exports

AWL (NSE): 617 ▲ 12 (+2.0%), PATANJALI (NSE): 1,190 ▲ 22 (+1.9%)

Shares of edible oil companies saw strong traction today. This happened after Indonesia, one of the top exporters of palm oil, announced a reduction in palm oil exports starting 1 January 2023. The move is to ensure sufficient domestic supply in Indonesia. Globally, Indonesia is the leading producer of palm oil. The export curbs could lead to a spike in palm oil prices in the international market - something Indian edible oil producers could benefit from.

⭐ NYE bonus for Welspun shareholders

WELENT (NSE): 166 ▼ 0.1 (-0.09%)

Welspun Enterprises has announced a buyback and a dividend. The company will conduct a share buyback at ₹200 per share. This is a premium of over 20% on 30 December’s closing price. The buyback will amount to ₹235 crore. The company also announced a one-time special dividend of ₹7.5 per share with a record date of 11 January 2023.

⭐ HPL Electric lights up

HPL (NSE): 100 ▲ 5.3 (+5.6%)

Electric equipment maker HPL Electric and Power’s shares rose over 5%. This, after the company said it received a new order worth ₹161 crore for the supply of smart meters. The new order, which comes from a leading private DISCOM player, will further expand the company’s metering order book to more than ₹600 crore. That represents nearly 60% of HPL’s FY22 revenue.

In Focus

2022: A year full of M&A deals

If you thought Elon Musk was the cat who ran away with the cream when he bought Twitter…ahem…let’s just tell you that India was the Tiger that roared on deal street this year. 

Here’s why - world over, corporate czars are cutting back, but India Inc has been on a shopping spree. 

Defying global trends, India has racked up a 42% year-on-year growth in M&A deals in 2022. The total value of M&A deals in the country rose to a whopping $152 billion. Let’s take a look at some of the key deals.

The biggest M&A deal of this year came in the financial service segment when HDFC Ltd announced a mega merger with HDFC Bank in a $40 billion deal. The deal, which will create a financial services behemoth, has received all regulatory approvals. 

Gautam Adani made the news when he bought it (a news channel). His acquisition of a majority stake in NDTV made the headlines. That was not all, though. Earlier in the year, Adani signed off on a $10.5 billion deal to acquire a majority stake in Ambuja and ACC cement. With this, the world’s 3rd richest man ventured into two new business segments, cement and electronic media.   

Reliance Industries also shopped for several deals in the retail space this year. The company acquired Metro’s cash and carry India business for ₹ 2,850 crore. In the FMCG space, it acquired the soft drink brand Campa Cola and a 26% stake in quick commerce company, Dunzo. 

The Indian aviation sector saw its largest-ever deal when Tata Group’s Vistara bought Air India at an enterprise value of $8.9 billion. This was also the biggest aviation deal globally this year. 

Meanwhile, multiplex chain operator PVR and INOX too, went ‘OTT’ with their merger to become the largest cinema chain operator in India. 

In case you still had any doubts on India’s resilience, the message is crystal clear. Corporate India is consolidating, expanding and investing in new sectors. 

Bright spot? Nay, call it ‘bright an’ busy.’

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Good to know

What are mergers and acquisitions?

Mergers and acquisitions refer to the consolidation of companies or their major business assets through financial transactions between companies. It is important to keep in mind that the word ‘mergers’ and ‘acquisitions’ are often used interchangeably, but they vary in meaning. In a merger, two firms combine to form a new legal entity under the banner of one corporate name. Whereas, in an acquisition, one company purchases another outright.

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