Friday high

Nifty50: 17,158 ▲ 228 (+1.3%)
Sensex: 57,570 ▲ 712 (+1.2%)

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On to the markets, which were in Friday mood today!

• After a gap-up opening, markets extended their gains for the third straight day.
• In all, 43 of the Nifty50 stocks closed in the green.
• India's fiscal deficit hit ₹3.52 lakh crore in April-June 2022, which is 21.2% of the full-year target.

Among the Nifty sectoral indices, Metal (+3.8%) and Oil and Gas (+2.1%) saw the most gains, whereas PSU Bank (-1.1%) was the sole loser.

What’s trending

⭐ Banks on a roll

HDFCBANK (NSE): 1,436 ▲ 19 (+1.3%), ICICIBANK (NSE): 818 ▲ 4.1 (+0.5%)

Despite rising interest rates, more businesses and individuals are taking loans, leading to an uptick of 13% in banks’ loan growth. Non-food credit grew year on year to ₹122 lakh crore in the fortnight ending 15 July 2022. This comes after large private banks such as ICICI Bank, HDFC Bank and Kotak Mahindra Bank reported strong earnings and loan growth in the first quarter of FY23.

⭐ Sun Pharma’s profit surges

SUNPHARMA (NSE): 943 ▲ 48 (+5.4%)

Sun Pharma reported a 43% YoY rise in consolidated net profit to ₹2,061 crore. Meanwhile, its total sales rose 10% to ₹10,643 crore, driven by sustained scale-up of its specialty business and all-round growth across markets.

⭐ SBI Life jumps post Q1 results

SBILIFE (NSE): 1,294 ▲ 102 (+8.6%)

Shares of SBI Life zoomed 9% intraday after it reported an 18% year-on-year (YoY) rise in its net profit to ₹262 crore in Q1FY23. The value of new business (VNB), a key metric of profitability, more than doubled to ₹880 crore in the quarter. Further, SBI Life’s VNB margins increased to 30.4% from 23.7% a year ago, higher than that of peers HDFC Life and ICICI Prudential for the June quarter.

⭐ Chalet Hotels profit jumps

CHALET (NSE): 319 ▼ 8.8 (-2.7%)

Mumbai-based hotel chain Chalet Hotels posted a consolidated revenue of ₹253 crore, up 275% YoY. It was back in black with a net profit ₹28 crore, after facing losses for eight consecutive quarters. Meanwhile, the hotel bagged a contract to develop and operate a 5-star deluxe hotel at Terminal 3 of the Delhi International Airport. The hotel will have 350-400 rooms and is expected to be commissioned by FY26.

⭐ Apple profits get India boost 

A near doubling of revenue from India and record-setting growth in markets like US, Mexico, Brazil and Korea helped Apple beat street estimates. The tech giant reported a 2% YoY rise in its June quarter revenues to $83 billion. However, the iPhone maker's growth was much slower than the 36% by which it grew in the same period last year. The company said it is going through a challenging operating environment, but that the revenues will continue to grow in the September quarter.

In Focus

Ending soon: Lock-in period for 2021 IPOs

2021 was a blockbuster year for IPOs. As many as 63 companies raised ₹1.2 lakh crore through their public offerings. The pre-IPO lock-in period for some of these companies is set to expire soon. 

But what is a lock-in period in the context of IPOs? 

The lock-in period is the time period for which the company’s promoters and pre-IPO shareholders are barred from selling their stake. As per SEBI norms, the lock-in period for companies that do not have promoters is one year (e.g. Zomato). For the companies that have promoters, the lock-in period is 18 months. SEBI imposes this lock-in to prevent any massive sell-off immediately after the IPO listing. 

On Monday this week, the one year lock-in for Zomato expired and the stock witnessed a huge sell-off. It plummeted to its lowest point at ₹40.6 apiece. In the next month alone, the lock-in period for 11 companies that listed in 2021 is set to expire. Among these, some large issues include Tatva Chintan Pharma, Rolex Rings, Windlas Biotech, CarTrade Tech and Glenmark Life Sciences. 

Of the above, Windlas Biotech, CarTrade Tech and Glenmark Life Sciences are currently trading below their respective issue prices. Meanwhile, Tatva Chintan Pharma and Rolex Rings are trading above their issue prices.

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Good to know

What are assets under management?

Assets under management (AUM) is the total market value of the investments that a financial institution manages on behalf of its clients. It is used to evaluate the performance of an investment firm. A higher or growing AUM is typically considered as a positive indicator of the quality and expertise of a fund manager. AUM fluctuates daily, reflecting the flow of money in and out of a particular fund and the movements in the prices of the assets in the fund. 

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