IPO market heats up

Nifty50: 15,834 ▲+112 (+0.7%)
Sensex: 52,880 ▲+395 (0.7%)

After a gap-up opening markets steadily inched up. Among the Nifty50 stocks 36 closed in green indicating overall positive sentiments.

In the pack of Nifty sectoral indices, Realty (+2.7%) and Bank (+1.1%) were the top gainers whereas IT (-0.2%) showed a minor drop.

Here are the top stories of the day.

 HDFC Bank sees subdued credit growth

• As per HDFC Bank’s update, India’s largest lender by market cap reported a 1.3% sequential growth in its loan book in the first quarter of FY22. However, the bank’s retail loans segment, which has been a key growth driver, contracted 1%.
• Retail deposits grew by 3.5% sequentially, but the CASA ratio (ratio of current accounts and savings accounts to total deposits) dropped to 45% in June quarter from 46.1% in March 2021. Meanwhile, shares of HDFC Bank rose 1% today.

India Pesticides makes a strong debut

• Shares of the agrochemical manufacturer listed at ₹360 on the BSE, a premium of 22% over its issue price of ₹296. However, they pared some of their early gains and closed at ₹343. Last week, the ₹800 crore IPO was oversubscribed 29 times. 
• This week, two more initial public offerings—GR Infraprojects and Clean Science and Technology—will open for subscription on Wednesday. You can apply for these IPOs on Upstox.    

Panacea Biotec gets nod to make Sputnik V

• Shares of the pharma company closed 4.9% higher after it received approval from the Drug Controller General of India (DGCI) to manufacture the Sputnik V vaccine. The company had earlier announced that it will produce 100 million doses of the vaccine annually, for the global market.
• The Sputnik V vaccine reportedly has an efficacy rate of over 91% and is one of the four vaccines to have received emergency use authorisation in India. It has already been registered in 67 countries across the globe.

Services PMI falls to 11-month low

• India’s Services Purchasing Managers’ Index (PMI)—an indicator of the activity in India’s services sector—fell to its lowest in 11 months. The index stood at 41.2 in June; a reading below 50 indicates a contraction. 
• Business activity and new orders decreased, with the fastest rates of contraction registered in consumer services. The Services PMI data comes on the heels of the Manufacturing PMI data released last week, which also showed a contraction. 

Closing bell

Despite mixed cues from international indices, Indian markets moved up with strength. Several states are gradually easing curbs, but the number of daily new cases being reported in the country is still around 40,000, which is a positive sign. Going ahead, as there are no major upcoming data releases this week, the attention will be on the June quarter results. Further, inflation continues to remain a challenge especially in the wake of firm fuel prices and a bounce back in prices of other commodities. Meanwhile, the US markets will be closed today in observance of Independence Day since the holiday fell during the weekend.

Good to know

What are index funds?
Index funds are mutual funds that track or replicate indices such as the Nifty50. Basically, they invest your money only in stocks that are part of a specific index. The allocation of the fund also depends solely on the composition of the index that the fund is tracking. Index funds are considered a part of a passive investment strategy and stand in contrast to active stock picking. The biggest advantage of index funds is that they have lower expenses as compared to actively managed funds.

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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.