Rebound

Nifty50: 15,638 ▲ 288 (+1.8%)
Sensex: 52,532 ▲ 934 (+1.8%)

Hello, people!

For once, markets didn't look like a complicated yoga pose, as they moved in a linear upward direction. Perhaps, bears were celebrating International Yoga Day away from the markets, on a yoga mat somewhere. 

Meanwhile, have you ever worn a swimsuit made of recycled plastic? Yes, they do exist. But you know what soon won’t exist anymore? Plastic straws for your drinks. In case you didn't know, the ban on plastic straws takes effect on 1 July. And beverage manufacturers are scrambling to find alternatives. More on that below.

• Taking cues from global peers, markets rose for the second consecutive day. 
• In all, 48 of the Nifty50 stocks closed in the green.
• Investors await the minutes of RBI’s monetary policy committee meeting on Wednesday.

All of the Nifty sectoral indices closed in the green with Media (+5.4%) and Oil and Gas (+4.8%) witnessing most gains.

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What’s trending

⭐ Apollo Hospitals, Imperial Hospital join hands 🤝

APOLLOHOSP (NSE) 3,811 ▼ 0.7 (-0.02%)

Indian healthcare group Apollo Hospitals announced it has signed a partnership with Bangladesh-based Imperial Hospital. The partnership will help Imperial Hospital in operating and managing the 375-bedded multi-speciality tertiary care hospital in Bangladesh. The facility will be named Apollo Imperial Hospital

⭐ Vodafone Idea considers fundraise ✆

IDEA (NSE): 8.4 ▲ 0.4 (+5.6%)

Vodafone Idea's board will meet on Wednesday (22 June), to consider raising ₹500 crore. The funds will be raised via the issue of equity shares or convertible warrants on a preferential basis. Warrants give their holder the right to buy the underlying share at a certain future date, at a specific price. This fundraise comes at a time when the government is looking to launch 5G services nationwide.

⭐ KEC International bags large order 💡

KEC (NSE): 373 ▲ 9.9 (+2.7%)

Shares of KEC International surged over 5% intraday after the company announced it has bagged new orders of ₹1,092 crore across various segments. Company’s transmission and distribution business received orders in India, Middle East and America (North & South). The railways business secured an order for 2 x 25 kV overhead electrification. The civil business bagged orders in the residential, industrial and defence segments.

⭐ Bandhan Bank impacted by Assam floods 🌊

BANDHANBNK (NSE): 282 ▲ 8.3 (+3.0%)

Shares of Bandhan Bank are under pressure as floods continue to devastate Assam. The stock is down nearly 10% from its closing price on Friday, though it recovered a little today. Assam is an important market for the private lender. The state accounts for about 6% of the lender’s loan book and 9% of the emerging entrepreneurs business (EEB).

⭐ Corporate actions to watch out for

AJANTPHARM (NSE): 1,847 ▲ 46 (+2.5%), NAZARA (NSE): 1,031 ▲ 10 (+1.0%), JUBLFOOD (NSE): 517 ▲ 20.9 (+4.2%)

Here are some upcoming corporate actions you'd be interested in. Ajanta Pharma has set Thursday (23 June) as the record date for its 1:2 bonus share issue. Meanwhile, Nazara Tech has fixed Monday (27 June) as the record date for its 1:1 bonus issue. Jubilant Foodworks has set 11 July as the record date for a dividend of ₹1.2 per share. 

In Focus

Beverage makers grasping at straws

With the nationwide ban on single-use plastic coming into effect on 1 July, the tiny plastic straws that come with juice boxes will be banned for good. This has a major impact on beverage manufacturers, as 60% of their juice sales come from the small packs. So what's the alternative?

Well, 6 billion small juice packets are produced and sold in India every year. Small packs help companies to reach a wider customer base. So, it has been difficult to find the right alternative so far. 

To overcome the ban, some companies like Dabur and Parle Agro are planning to import paper straws. This is because India doesn’t have enough capacity to manufacture paper straws. But the imported paper straws cost nearly 3 times more than plastic straws, and this can impact the margins of beverage manufacturers. 

Meanwhile, some companies are redesigning the carton box, so the juice can be consumed without straw. So while some solutions are being explored, companies want the government to delay the ban by 6 to 12 months for a smoother transition.  

But you know how the world works. One man's loss is another man's gain. The news has been positive for the paper industry. Shares of companies like JK Paper, Emami Paper and West Coast Paper were up by 3 to 6% today. 

In fact, packaging company UFlex is planning to set up a ₹100 crore paper straw manufacturing plant. It plans to make nearly six billion paper straws every year to cater to the rising industry demand. The stock jumped 4.4% today.

While the ban will be tough on the beverage companies initially, it will go a long way in reducing plastic waste.

IPO Corner

Inox Green Energy Services, a subsidiary of Inox Wind, has filed fresh draft papers with the market regulator SEBI for a ₹740 crore IPO. The IPO will be a combination of a fresh issue and an offer for sale. The money raised through the fresh issue will be used for repayment of the company’s debt.

Good to know

What is a bonus issue?

A bonus issue is a corporate action in which the company’s existing shareholders get additional shares at no extra cost. However, this depends on the number of shares a shareholder owns. For instance, if a company offers a 1:1 bonus issue, it means that the shareholder will get one share for each one share held by them. But this increase in the number of shares doesn’t affect the value of the company or the total value of shares held by the shareholder. After the bonus issue, the stock price generally falls in the same proportion as the bonus issue. So, for a 1:1 bonus, the stock price will be reduced to half.

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