Street gets cold feet 😰

Nifty50: 17,102 ▼ 142 (-0.8%)
Sensex: 57,060 ▼ 460 (-0.8%)

Mayday! Mayday!

We can’t say this enough. What with the oscillating markets and spiralling temperatures.

The markets made a strong start, but gave up all the gains in the last hour of trade. Doesn't this remind you of yourself? You’re fresh when you wake up, but by noon, the heat has already sapped your energy. 

As if the soaring heat wasn’t bad enough, power cuts may make matters worse. The Delhi government has warned that the coal shortage could lead to power cuts. 

It’s not all bad, though. If nothing else, you’ll have a reason to head to the nearest cinema and watch your favourite blockbuster in the AC hall. 🍿

• Markets reversed their initial gains and closed deep in the red as investors chose to book profits ahead of the US Fed’s meeting early next week. 
• In all, 38 of the Nifty50 stocks closed in the negative. 
• The US economy contracted by 1.4% after witnessing 6.9% growth in the final quarter of 2021, which also acted as a sentiment spoiler.

All of the Nifty sectoral indices closed in the red with Media (-2.8%) seeing maximum losses.

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What’s trending

⭐Varroc shifts gears 🛵

Aurangabad-based auto component manufacturer Varroc (+8.6%) will sell its 4-wheeler lighting business in the US and EU for €600 million (about ₹4,800 crore) to France-based Compagnie Plastic Omnium. It plans to focus on its EV product lines, electronics and the two-wheeler segment globally.

⭐ A ‘Maha’ jump 🏦

Bank of Maharashtra (-1.1%) reported a 115% jump in net profit to ₹355 crore for the March quarter. The bank’s asset quality has significantly improved as its gross non-performing assets declined to 3.9% from 7.2% a year ago. 

 ⭐Camlin Fine, not so fine👎

Shares of specialty chemicals maker Camlin Fine Sciences slipped 17% intraday after it that said its overall costs have risen due to the Russia-Ukraine crisis. The company’s Italian subsidiary’s power cost has increased by 240% in the March quarter. This has led to an overall increase in power cost by ₹28 crore, which may impact the company’s Q4 and FY22 performance.

⭐Shriram Transport trucking ahead 🚚

Commercial vehicle financier Shriram Transport closed 5% higher as it reported a 44% growth year-on-year in its Q4 net profit to ₹1,086 crore. This was supported by a 22% rise in net interest income. 

⭐Coal aboard!🚆

Over 650 mail and passenger trains will be cancelled in peak holiday season to make way for coal rakes. These rakes will be used to move coal to thermal power plants. BRB, after I check my train status.

⭐ Chasing Rainbow🌈 

The IPO of hospital chain Rainbow Children’s Medicare received strong interest from investors on the last day. After a subdued start, the public issue was oversubscribed 12 times. The portion for qualified institutional buyers was subscribed more than 38 times.

In Focus

Power costs jolt UltraTech ⚡

At first glance, Ultratech Cement's 38% year-on-year gain in its March quarter net profit looks impressive. However, if we exclude one-off items, its profit has actually dropped by 17%. So what's impacted the performance? A 48% rise in power and fuel costs.

The company, however, is seeing a gradual improvement in demand, thanks to government projects. As a result, its plants are running at 90% capacity. Revenues are also up 8% YoY in the quarter.

Going forward, the company expects both rural and urban demand to pick-up. It has also managed to significantly improve on the debt front. Its net debt-to-equity ratio (a barometer of a company’s financial health) has reduced to 0.3x from 2.6x in FY19.

IPO corner

It seems like foreign investors are queuing up for India’s biggest-ever IPO. Sovereign funds from three countries—Norway, Singapore and Abu Dhabi—will be anchor investors for the LIC IPO, according to reports.

For more details on LIC IPO, click here. 

Good to know

Who are anchor investors?

Anchor investors are institutions that are allotted shares at a fixed price with a 30-day lock-in period before the IPO opens to the public. Each investor is required to invest at least ₹10 crore. Investment by anchor investors ahead of the IPO creates a buzz among retail investors. It is generally seen as a confidence booster as institutions make well-researched investment decisions.

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