Markets Feel the Heat from Global Markets

Markets continued to be under pressure and it was not just the LTCG effect. Global markets led by Dow, concerns on rising interest rates and also bond yields going crazy in the US. The BSESENSEX lost on four of the five trading days and was down 1,060.99 points or 3.12% at 34,005.76 points. NIFTY lost 305.65 points or 2.92% to close at 10,454.95 points. BSEMIDCAP and BSESMALLCAP gained 0.36% and 1.79% respectively.

Dow Jones was down 1,330.06 points or 5.50% at 24,190.90 points. It has entered negative territory for the calendar year 2018. Global markets have been rattled with the happenings in Dow and after a stellar run, the correction was more than overdue.

The primary market focus has clearly shifted to the SME segment. On the main board you now have far fewer issues than what are coming from the SME segment. There are more than two to three issues opening every week and with NBFC’s more than willing to finance the applications of HNI’s, the issue gets subscribed many times.

The main board has one issue which opens on Monday the 12th of February and closes on Thursday the 15th of February from Aster DM Healthcare Limited which is in the business of running hospitals, clinics and pharmacies in the GCC and India. The company has 19 hospitals, 98 clinics and 206 pharmacies, the bigger part of which is in the GCC and the smaller part in India, primarily in Southern India. Total revenue for the company is Rs 5,931 crs and a profit after tax of Rs 266.7 crs. The EPS for the year ended March 2017 is Rs 4.28 which values the company at a PE multiple of 44.29-44.39 based on March 2017 numbers. The company in terms of revenues is a close second to the Apollo group of hospitals. The price band is between Rs 180-190. The issue consists of a fresh issue to raise Rs 725 crs and an offer for sale of 1.34 cr shares. With GCC operations being well set and fairly matured, the focus of the company is in India where the opportunity seems to be ever expanding. The company has a total of 4,754 beds and besides setting up new hospitals, is also looking at the acquisition route to grow faster.

It has been decided that Indian stock indices would not trade overseas as they currently do in Singapore and Dubai. The exchanges would give notice and close down trading within six months. This is to ensure that liquidity from India is not sacrificed to trading overseas. This move would ensure that in the longer-term trading volumes in India would increase and the pressure that Singapore Nifty exerted on our markets would cease to happen. This augurs well for Indian bourses and one would see higher volumes and better price discovery in future as well.

Markets may have bottomed out in terms of price correction but time correction is certainly a long way off. It would take time for indices to settle down, consolidate before any meaningful rally begins all over again. We have recovered a mere 20% of the fall and have a long way to go before getting back to 29th January highs. Further global markets too need to consolidate. Wait for right opportunities as plenty of them would come your way.

Galaxy Surfactants Limited – Debuts with Gains of Over 14.74%

Shares of Galaxy Surfactants Limited debuted on the bourses on Thursday. The company had tapped the capital markets with its offer for sale of 63,31,674 equity shares in a price band of Rs 1,470 -1,480. It had earlier allotted 18,99,500 equity shares to 25 anchor investors comprising of 30 entities. The issue was very well subscribed.

The public issue was subscribed 20 times overall with the QIB portion subscribed 54.27 times. Non-institution portion was subscribed 6.96 times and retail portion subscribed 6.01 times. This was the second attempt at tapping the capital markets by Galaxy Surfactants Limited. The first time it had failed to get QIB portion fully subscribed.

The discovered price was Rs 1,520 on the BSE and Rs 1,525 on the NSE. The high was Rs 1,732 on the BSE and Rs 1,735 on the NSE. The low was the open itself on both the exchanges. The close was Rs 1,698.10 and Rs 1,700.45 respectively. The share gained Rs 218.10 on the BSE or 14.74% while it was Rs 220.45 or 14.90% on the NSE.

Exchange Open High Low Close Net Change % Gain/ Loss Wt.Avg Volume Delivery Del %age
BSE 1520.00 1732.00 1520.00 1698.10 218.10 14.74 1633.16 1349330 315255 23.36
NSE 1525.00 1735.00 1525.00 1700.45 220.45 14.90 1630.36 8538388 2588210 30.31
Total 9887718 2903465 29.36

The traded volume on the two exchanges combined was 98.87 lac shares which was 1.56 times the IPO size of 63.31 lac shares. Delivery volume was 29.03 lac shares which was 29.36% of the traded volume but 45.86% of the IPO size. If one considers the fact that the anchor portion is locked in for one month, the delivery volume was 65.51% of the non-anchor portion which is considerable. The weighted average of the day was Rs 1,633.16 on the BSE and Rs 1,630.36 on the NSE which is significantly lower than the day’s close. There were no institutional trades either on the buy or sell side which is a little intriguing.

The share has done well and a gain of 14.74% is significant.

Aster DM Healthcare Limited – Completes Anchor Allocation

Aster DM Healthcare Limited which is tapping the capitals markets with its simultaneous offer for sale and fresh issue completed allocation to anchor investors. The company allotted 1,54,75,843 shares to 7 anchor investors comprising of 8 entities. The highest allocation was done to SBI Mutual Fund and Sundaram Mutual Fund of 34,25,058 shares a piece which is 22.13% of the anchor book. The shares were allotted at Rs 190.

The issue consists of a fresh issue to raise Rs 725 crs and an offer for sale of 1,34,28,251 equity shares ina price band of Rs 180-190. The issue opens on Monday the 12th of February and closes on Thursday the 15th of February.

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