The IPO party is far from over

Nifty50: 16,931 ▲ +225 (+1.3%)
Sensex: 56,889 ▲ +765 (+1.3%)

The markets surged for the second day in a row, with the Nifty50 breaching and closing past the 17,000 mark. Like yesterday, buying interest was spread across the board, with 42 of the benchmark index’s stocks posting gains today. 

Nifty Metal (+1.5%) and IT (+1.3%) led the sectoral indices, while only Nifty Media (-0.1%) showed slight weakness.

Here are the top stories of the day.

Two IPOs open tomorrow

September opens with two IPOs and these include Vijaya Diagnostic and Ami Organics. Vijaya Organic is a Hyderabad-based chain of diagnostics clinic that aims to raise ₹1,894 crore through its public issue. The proceeds will be used as an offer for sale. The IPO’s price band is set at ₹522–531.

Meanwhile, Ami Organics is a specialty chemicals manufacturer that produces key starting material for agrochemical and fine chemicals and active pharmaceutical ingredients (APIs) for the pharma sector. Its ₹570 crore comprises a fresh issue of ₹200 crore, while the rest is an offer for sale. The price band for this IPO is set at ₹603–610. You can subscribe to both IPOs with Upstox here. 

L&T sells hydropower project

The infrastructure major has sold its entire stake in the 99MW hydroelectric power plant in Uttarakhand to Renew Power. L&T received ₹1,001 crore for the project from the Gurugram-based renewable energy company.

As per L&T, the sale is in line with the company’s aim to divest all assets that are part of its non-core portfolio. The stock closed nearly 1% higher today, and has gained over 11% so far in the current quarter.

Tata Coffee gains as coffee prices rise

Shares of Tata Coffee surged nearly 9% intraday today. This surge is believed to be because of a spike in international coffee prices. Commodity prices of coffee have risen in the wake of bad weather in Brazil—a major coffee grower—which may hurt both production and supply chain. 

As per reports, Tata Coffee is expected to get margin benefits from the price rise, which could augur well for the company’s Q2 performance. The stock closed 7.0% higher today, about 13% shy of its lifetime-high of ₹247 achieved in late July.    

Closing bell

While there were concerns of below-normal monsoons till last week, revival of the monsoon in several states is welcome news for the markets. The expected bounce in the June quarter GDP numbers, too, added to the optimism. Further, rising international indices aided investor confidence. Amid this, it is important to take note of a 9% spike in the volatility index, India Vix, which indicates that traders expect volatility to rise in the coming days. 

Good to know

What is value investing?

Value investing is an investment strategy that involves buying stocks or assets that appear to be trading below their intrinsic value. Intrinsic value of a stock refers to the worth of an asset, based on its fundamentals and independent of external factors such as market sentiments. Value investors search for stocks that they believe are being undervalued by the market, and see an opportunity to make a profit by purchasing the stock at discounted prices.

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Investment in securities markets is subject to market risks; please read all the related documents carefully before investing. The securities quoted are exemplary and are not recommendatory. Past performance is not indicative of future results. Details provided in the above newsletter are for educational purposes and should not be construed as investment advice by RKSV group. Investors should consult their investment advisor before making any investment decision.