Markets began on a weak note and lost ground during the week. Unlike previous weeks there was a weak opening on Monday and that set the tone. The markets lost on the first three days of the week and recovered some ground on the remaining two days, but it was not enough to end in positive territory. BSESENSEX lost 233.25 points or 0.66% to close at 38,389.82 points. NIFTY lost 91.40 points or 0.79% to close at 11,589.10 points. The broader indices saw the BSE100, BSE200 and BSE500 lose 1.03%, 1.13% and 1.19% respectively.
August futures expired on Thursday the 30th of August with gains of 369.60 points or 3.20% to close at 11,536.90 points. The Indian Rupee continued to be under pressure and was down 74 paisa or 1.03% to close at Rs 71.73 Dow Jones lost 48.28 points or 0.19% to close at 25916.54 points.
SEBI has given some relief to funds managed by Indian Fund managers of HNI’s and people of Indian origin. Markets had been badly hit on this ground when trading began on Monday. With clarity on the same emerging there would be a strong undercurrent in the market place in coming days.
Primary markets are becoming active again and the government kicked of its roadshow of Ircon International Limited, which is a railway ministry issue and would be opening on Monday the 17th of September. More of this issue next week. Some more issues are expected in the week ahead and a couple of companies would have their road shows.
There is a SME IPO from Rajshree Polypack Limited which is tapping the markets with its fresh issue of 29 lac shares in a price band of Rs 119-121. The company is in the manufacture of rigid plastic sheets and thermoformed packaging products. It caters to the dairy industry with cups and containers for yoghurt and ice cream, food packing, QSR’s, coffee cups, bakery products and confectioneries amongst others. It reported sales of Rs 111.97 crs for financial year ended March 2018 with a net profit of Rs 9.31 crs.
The EPS for the year was Rs 11.67 which means that the PE for the offer is between 10.19 – 10.36 times. The closest competitor is Moldtek Packaging which had an EPS of Rs 11.44 for the financial year ended March 2018 and trades at a PE multiple of 27.74 times. Considering the differential, the issue looks attractive and going forward should offer opportunities for growth. The issue would be listed on NSE EMERGE and should hopefully migrate to the main board in due course of time. Subscribing to the issue merits attention.
Our markets are 600 points away from a new high on the BSESENSEX and 171 points in the case of NIFTY. The lows of the previous week were 696 points lower on the BSESENSEX and 196 points on the NIFTY. It could be therefore said that we are midway from the low of last week and a new high. Anything can happen, and one needs to be nimble footed in the marketplace.
Thursday is a trading holiday and would break momentum mid-week. Markets would remain choppy and volatile. Trade cautiously.
