The short and truncated week gone by had a mere three trading days but was highly volatile. Each of the three days saw the benchmark indices move by more than one percent with Tuesday, which was the first day of the week seeing a movement in excess of 2%. Markets gained on two of the three days. BSESENSEX gained 1,021.33 points or 2.08% to close at 50,029.83 points while NIFTY gained 360.05 points or 2.48% to close at 14,867.35 points. The broader indices saw BSE100, BSE200 and BSE500 gain 2.42%, 2.62% and 2.70% respectively. BSEMIDCAP was up 2.73% while BSESMALLCAP was up 3.91%. There were no sectoral losers during the week with BSEMETAL gaining 8.54% on the back of an expected stimulus in the US which would lead to increased spending on infrastructure.

The Indian Rupee lost 59 paisa or 0.81% to close at Rs 73.10 to the US Dollar. Dow Jones gained 80.33 points or 0.24% to close at 33,153.21 points.

Shares of Nazara Technologies listed on Tuesday and after debuting at Rs 1,971 a gain of Rs 970 or 79%, closed at the lower circuit of the day at Rs 1,576.80 on BSE. The gain for the day was Rs 475.80 or 43.22%. At end of week, the share recovered some lost ground and closed at Rs 1,669.85 a gain of 51.67%.

The week ahead sees the mega IPO from Macrotech Developers Limited, formerly known as Lodha Developers tap the market. The issue would raise Rs 2,500 crs in a price band of Rs 483-486 and would open on Wednesday the 7th of April and close on Friday the 9th of April. Macrotech Developers is focussed on the affordable housing and mid-segment sections of the real estate market and is a developer in MMR (Mumbai Metropolitan Region). It has a few years ago entered the adjoining Pune market as well.

The company reported revenues of Rs 9,576 crs, EBITDA of Rs 2,925 and a profit after tax of Rs 1,205 crs for the year ended March 2020. Its EBITDA margins were Rs 30.5% while PAT margins were 12.6%. The company has been delivering large number of dwellings every year and with its huge land parcels which are concentrated in nature, and thus has the ability to focus on the affordable segment. This segment has incentives from the government and is the fastest growing segment in the real estate market. The affordable segment fetches a realisation of about Rs 5,000 per square foot while in the mid-segment the average realisation is Rs 7,500 per square foot. The company believes that their business model is like a FMCG company and is confident of continuing to delivering the largest number of sales across real estate developers in residential segment. They have been delivering close to 10 million square feet in the last year and expect to do even better in the coming years. The issue based on EPS for the year ended March 20, of Rs 18.46, values the company at a PE multiple of 26.15-26.33 times. This valuation is in line with its peers.

The week ahead sees RBI’s monetary policy meeting which would be held from Monday to Wednesday. While RBI I expected to keep rates unchanged, it I widely expected to maintain an accommodative stance.

On the covid-19 front, the surge witnessed in the previous week continues unabated. The world saw 13,19,08,089 patients, 28,65,917 deaths and 10,61,95,319 patients recovering. In India we saw 1,25,87,920 patients, 1,65,132 deaths and 1,16,79,958 patients recovering. Compared to the previous week, the world saw 36,74,984 new patients, 61,698 deaths and 27,51,721 patients recovering. In India we saw 4,92,591 new patients, 2,985 deaths and 2,89,129 patients recovering. India has vaccinated over 6.5 cr people and about 25-30 lac vaccinations are taking place daily. While we need to step up the pace of vaccination, extreme caution by all needs to be taken on maintaining social distancing irrespective of whether they are vaccinated or not.

GST collections hit a record 1.24 lac cr mark in February 2021 and this would be an encouraging number for all concerned. The week ahead would continue to remain volatile and look for cues on the covid-19 front amongst other news. US and global cues will have an important bearing as well as quarterly results as they are announced.

Use sharp rallies to sell and sharp dips to buy in the market as we continue to remain in a trading zone.

Shares of Nazara Technologies Limited listed on the bourses and had a great start with the discovered price being Rs 1,971 on BSE and Rs 1,990 on NSE. They closed locked at the lower circuit of the day of Rs 1,576.80 on BSE and Rs 1,592 on NSE. Gains registered at close of day were a decent 43.22% on day one.

Nazara had tapped the capital markets with its offer for sale of 52,94,392 equity shares. The issue was oversubscribed 175.46 times. QIB portion was subscribed 103.77 times, HNI portion was subscribed 389.89 times, Retail portion was subscribed 75.29 times and Employee quota was subscribed 7.55 times. There were 23.34 lac applications and on basis of lots, Retail portion was subscribed 57.55 times.

The company had earlier completed allocation to anchor investors. The company allotted 23,73,395 equity shares at Rs 1,101 to 25 anchor investors comprising of 43 entities. The highest allocation of 1,99,823 shares or 8.4% of the anchor allocation was made to Government of Singapore. This was followed by 13 anchor investors who were allotted an identical 1,19,899 shares or 5.1% of the anchor book.

The issue had opened on Wednesday the 17th of March and closed on Friday the 19th of March 2021. The price band for a Rs 4 paid up equity share is Rs 1,100 – 1,101.

The discovered price on BSE was Rs 1,971, high of the day was Rs 2,026.90, low was the lower circuit at Rs 1,576.80 and this was also the close of the day. Shares gained Rs 475.80 or 43.22%. On NSE the discovered price was Rs 1,990, high was Rs 2,024.90, low was the lower circuit of Rs 1,592 and the close was also the same. Share gained Rs 491 or 44.60%.

Traded volume on the two exchanges was 83.28 lac shares which was 1.57 times the IPO size of 52.94 lac shares and 2.85 times the non-anchor portion of 29.20 lac shares. Delivery volume was 30.37 lac shares which was 36.47% of traded volume. It was 57.37% of the IPO size and 103.99% of the non-anchor portion. Very clearly some of the selling shareholders who did not exit totally through the IPO and still had shares which were not locked-in have cashed out. Market grapevine suggests that the sales are from the holding of IIFL Special Opportunities Fund.

Weighted average of the day’s trade was 1,704.73 on BSE and Rs 1,766.58 on NSE. Very clearly barring the opening of the day and the high immediately thereafter, the share was under pressure and hence the closing price is substantially lower than the weighted average. The cost of funding for the leveraged HNI was in the region of Rs 615-625. This suggests that all those who sold before the stock hit the lower circuit have made some money.

With 30 lac shares changing hands through delivery, no names were reported either on the buy side or the sell side. This suggests that people who have bought on day one, is small size tickets not coming under the ambit of reporting. With no hangover of existing investors from the IPO other than the pre-IPO shareholders who still have some free or non-lock in shares, one would see wild movement in the counter as the share has closed below average. The new buyers yesterday would have bought around the average and that is roughly 11% higher than the close. Interesting to see how the share would move in the coming days.