No weekend hangover

Nifty50: 17,665 ▲ 126 (+0.7%)
Sensex: 59,245 ▲ 442 (+0.7%)

Greetings, people!

Most of us have two sets of teachers in our lives - the ones who give birth to us and those who teach us the ABC’s. Traders will tell you of a third teacher — a tad unforgiving, but one that can also be extremely rewarding if you learn your lesson well. We are talking of the stock markets that famously punish the ‘greedy’ and 'rash' students while rewarding the  ‘patient’ and ‘disciplined’ ones. What life lesson did the markets teach you? Do write and let us know!

• After a steady start, markets inched up. They stayed up for the rest of the day, despite weak cues from the key Asian and European indices. 
• In all, 35 of the Nifty50 stocks closed in the green. 
• The US markets are closed on account of Labour Day.

All of the Nifty sectoral indices closed higher, with Media (+2.7%) and Metal (+1.6%) witnessing maximum gains.

What’s trending

⭐ HAL’s on a rocket ship

HAL (NSE): 2,375 ▲ 6 (+0.2%)

A consortium led by Hindustan Aeronautics has bagged an order worth ₹860 crore from Newspace India (NSIL). Incorporated in 2019, NSIL is a wholly-owned Indian government company. Under the agreement, the consortium will build five rockets or Polar Satellite Launch Vehicles. Meanwhile, HAL’s stock has been a high flier rising 96%, so far in 2022. 

⭐ M&M Finance scales new highs

MFIN (NSE): 215 ▲ 5.9 (+2.8%)

M&M group’s NBFC firm hit a 52-week high as it announced its monthly business update. It reported a 75% YoY growth in total disbursements to ₹3,740 crores in August. The management said in the backdrop of the positive economic environment, the business momentum has continued. The NBFC’s stage 3 assets i.e. accounts that have defaulted on loan repayment for more than 90 days, were stable.

⭐ Dixon Tech, Google join hands

DIXON (NSE): 4,205 ▲ 95 (+2.3%)

Electronics manufacturer Dixon Technologies has signed an agreement with Google. This will allow the company to manufacture TVs that will run on the Android operating system. Dixon has become the first contract manufacturer in India to get this sub-licence. The agreement will further strengthen the company’s market leadership in the LED TV category. ICYDK, Dixon is a leading manufacturer of LED TVs for top electronic brands.

⭐ Olectra gets ‘electrified’

OLECTRA (NSE): 653 ▲ 15 (+2.3%)

Hyderabad-based electric bus manufacturer Olectra Greentech has secured an order worth ₹151 crore. This is nearly 25% of its FY22 revenue. The company has to supply 100 electric buses to one of the state transport corporations over a period of nine months. Olectra will also be responsible for the maintenance for five years. 

⭐ Good news from the service sector

Latest PMI (Purchasing Managers’ Index) data shows a positive near term outlook for the services sector. The PMI for services rose to 57.2 for August as against 55.5 in July. A reading above 50 indicates expansion in activity while a below 50 signals contraction. And just in case you are hunting for a new job, here’s some more good news. As per a latest industry report, hiring at India Inc in April-June 2022 was at its fastest in more than 14 years.

In Focus

India’s consumers maange more!

India’s consumption story is intact, latest RBI data shows. Home loan numbers, house prices, credit card spends and personal loans, all are showing a steady uptick. Let’s get you those numbers from RBI’s monthly report on bank credit. 

The total outstanding home loans grew to ₹17.4 lakh crores, up 15.1% from the previous year. In plain English, more people are buying homes and taking home loans despite interest rates going up. 

Home loan growth has been well supported by robust housing demand in India. This too comes despite an increase in property prices. RBI’s House Price Index (HPI) grew by 3.5% YoY in the first quarter of FY23. Meanwhile, property registration in key housing markets like Mumbai jumped by 20% YoY. 

The personal loans and credit card segment also recorded growth. Credit card spending rose by 6.4% month-on-month to ₹1.16 lakh crores in July, indicating revival in discretionary spending and consumption after a prolonged slowdown. (FYI, credit card spends have grown 54% annually - last year being a complete washout owing to the Delta wave). Industry experts are expecting further growth with the onset of the festive season.

To sum, bank credit grew by 14.5% in the fortnight ended July 29 as per the RBI. Domestic stock markets have also reflected optimism, with the benchmark Nifty 50 index gaining nearly 3.5% in August 2022.

IPO corner

Tamilnad Mercantile Bank’s ₹832 crore IPO received strong response on day 1. The 100-year-old private sector bank’s public offer was subscribed 83%. Retail investors flocked towards the IPO with the retail portion being subscribed more than 1.5 times.

Click here to apply for the IPO on Upstox.

Good to know

What is book building?

When launching an IPO, book building is one of the methods used by companies to determine the selling price of the shares. Instead of deciding on a fixed price, through book building, the company assesses the demand and declares a price range for the bid. The investors choose a bidding price and number of shares when filing the application. The cut-off price is finalised based on the applications received, once the bidding process is completed.

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