Markets continued their gains and made new highs on an intraday and closing basis on the benchmark indices. The benchmark indices recorded gains on all five trading sessions of the week. In doing so, NIFTY has created a new record of gaining 12 straight sessions. BSESENSEX could not do so as it had lost ground on 19th of August when it was down a mere 12 points while NIFTY  gained 31 points. BSESENSEX gained 1,279.56 points or 1.58% to close at 82,365.77 points while NIFTY gained 412.75 points or 1.66% to close at 23,235.90 points. The broader markets saw BSE100, BSE200 and BSE500 gain 1.53%, 1.37% and 1.32% respectively. BSEMIDCAP gained 1.54% while BSESMALLCAP was up 0.61%. The intraday highs made on BSESENSEX was at 82,637.03 points. The closing of Friday was the closing highs. 

The Indian Rupee gained three paisa or 0.04% to close at Rs 83.86 to the US Dollar. Dow Jones gained on four of the five trading sessions and lost on one. Dow Jones gained 388 points or 0.94% to close at 41,563.08 points. 

Reliance Industries Limited at its AGM held on Thursday the 29th of August decided to announce a bonus of 1:1 at its Board of Directors meeting convened for the purpose on Thursday the 5th of September. This would be a bonus issue after seven years being announced by the company. The impact of the announcement did not have any significant impact on the share price and the weekly gain on the share was a mere Rs 20 or 0.67%. Not sure how one should read this as it appears the old adage; ‘Buy the rumour, sell the fact, apply or the counter has become tired after being active over the last couple of weeks. 

August futures expired on Thursday the 29th of August on a positive note. For the series the gains were 745.85 points or 3.06% to close at 25,151.95 points. The series had begun at 24,406.10 points. 

The week saw an active primary market with two listings during the week. There were two issues which opened and closed for subscription during the week. Looking at subscription numbers, one can clearly conclude that investor appetite and liquidity seem to have no limits. 

The first issue to list was Interarch Building Products Limited which had allotted shares at Rs 900 per share. The share debuted on Monday the 26th of August at Rs 1,291.20, a gain of Rs 391.20 or 43.46%. The share closed on Monday at Rs 1,196.45, a gain of Rs 296.45 or 32.93%. Over the remaining four days, the share lost some ground and closed at Rs 1,171.75, a gain of Rs 271.75 or 30.19%. 

The second share to list was Orient Technologies Limited which had issued shares at Rs 206. The discovered price of the share which listed on Wednesday was Rs 290 and thereafter it was locked at upper circuit at Rs 304.45, a gain of Rs 98.45 or 47.79%. On NSE, the discovered price was Rs 288 and the upper circuit was at Rs 302.40. The share continued to hit upper circuit of 5% on the remaining two days of the week and closed at Rs 335.60, a gain of Rs 129.60 or 62.91%. The share would trade for the next seven trading sessions in the trade-to-trade segment as the issue size was less than Rs 250 crores. 

The first IPO to open and close its subscription was Premier Energies Limited. This issue became the second company to garner a subscription of over Rs 1 lakh crores after Tata Technologies Limited who had done so in November 23. Premier garnered Rs 1.48 lakh crores. The issue was oversubscribed an overall 75.62 times. QIB portion was subscribed 212.62 times, HNI portion 51.27 times and Retail portion was subscribed 7.88 times. There were 40.63 lakh applications. The issue was open from Tuesday the 27th of August and closed on Thursday the 29th of August. 

The second issue to open and close during the week was ECOS (India) Mobility and Hospitality Limited. This issue was open from Wednesday the 28th of August to Friday the 30th of August. The issue was oversubscribed an overall 64.26 times with QIB portion subscribed 136.85 times, HNI portion subscribed 171.23 times and Retail portion 19.79 times. There were 25.12 lakh applications in all. 

The week ahead has two issues open for subscription with one issue having opened on Friday and yet another opening on Monday. The issue from Bazaar Style Retail Limited opened on Friday the 30th of August and would close on Tuesday the 3rd of September. The issue consists of a fresh issue of Rs 148 crores and an offer for sale of 1,76,52,320 equity shares in a price band of Rs 370-389. 

The company reported an EPS of Rs 3.14 for the year ended March 24. It is in the business of being a value fashion retailer offering quality and affordable products under the apparels and general merchandise segments through a chain of value retail stores. Its stores are primarily located in Orissa and West Bengal and the company has a total of 163 stores. 

The PE multiple is 117.83-123.89 based on the March 24 numbers. On the face of it the PE multiple looks a little expensive but looking at the flavor and the market liquidity one may apply for listing gains as there is substantial activity in the counter in the grey market. 

The second issue is from Gala Precision Engineering Limited which is tapping the capital markets with its fresh issue of 25,58,416 equity shares and an offer for sale of 6,16,000 equity shares in a price band of Rs 503-529. The issue opens on Monday the 2nd of September and closes on Wednesday the 4th of September. The company is a precision component manufacturer of technical springs like disc and strip springs including wedge lock washers. It reported an EPS of Rs 21.77 for the year ended March 24 and based on the above EPS, the PE multiple is 20.94-22.02 times. 

There are a number of roadshows planned in the week ahead for IPOs on the main board. Besides this the two IPOs that closed last week would be listed on Tuesday and Wednesday respectively while the issue that opened on Friday and would close on Tuesday, Bazaar Style Retail would also list on Friday the 6th of September. 

Coming to the markets in the week ahead, expect markets to have volatility as the key driver. With surplus liquidity and optimism, people are willing to buy on every dip. Gut feel says that this month (September) would be the month where markets sit back, relax and take a pause after a hectic rally over the last 12 months or so. It’s time to retrospect on what has happened and take a hard look at June results which saw the slowest growth in the last 9 quarters. It would be time to reflect, ponder and think out of the box as to what could change in the quarter ahead, which would bring the sequence of falling growth back on track. 

With markets at new highs, we are in uncharted territory and the upside has no immediate levels of resistances. Support levels of 25,000 on NIFTY and at 81,650 on BSESENSEX become crucial levels for longs. If these levels are decisively broken and sustained, one should liquidate long positions and brace for corrections. This is for the brave hearted and impulse traders. For the seasoned player, systematically reducing positions could be a better idea as the positions get lightened in a systematic manner and give you place and room to manoeuvre. 

If I had to play to my thoughts and gut feel, I strongly believe that the series which began on Friday the 30th of August would end with losses when the series closes on Thursday the 26th of September. This is considering many factors which include the expected US FED interest rate cut, expected September quarter results and many more factors.

The week gone by had plenty of action and markets built on the super booster dose of Friday the 16th August when it had registered super gains of over 1,300 points on BSESENSEX and 400 points on NIFTY. This week saw no jump but, they built on the head start and inched upwards to set up what could be a flourish in the coming week. BSESENSEX gained 649.37 points or 0.81% to close at 81,086.21 points while NIFTY gained 282 points or 1.15% to close at 24,823.15 points. The broader markets saw BSE100, BSE200 and BSE500 gain 1.26%, 1.31% and 1.53% respectively. BSEMIDCAP was up 1.96% while BSESMALLCAP gained 3.39%. During the week, BSESENSEX gained on four sessions and lost a tad on the opening session of the week, while NIFTY gained on all five trading sessions. Markets are within striking distance of all-time highs made on the 1st of August, earlier this month. 

The Indian Rupee gained 7 paisa or 0.08% to close at Rs 83.89. Dow Jones had a decent showing backed by a superlative effort on Friday, the closing day of the week when it gained 462 points. This helped Dow gain 515.32 points or 1.27% to close at 41,175.08 points. Dow gained on three of the five trading sessions and lost on two. 

There is a lot of activity happening in the primary markets. Shares of Saraswati Saree Depot Limited which were issued at Rs 160, listed on Tuesday the 20th of August. The share debuted at Rs 200, and closed at upper circuit of Rs 209.95 on day one. The gains made were Rs 49.95 or 31.21%. By Friday, the share witnessed profit taking and closed at Rs 180.10, a gain of Rs 20.10 or 12.56% on BSE. On NSE, the share closed lower at Rs 177.95, a gain of Rs 17.95 or 11.21%.  

The issue from Interarch Building Products Limited which had opened on Monday the 19th of August and closed on Wednesday the 21st of August, received excellent response.  The price band was Rs 850-900. The issue consisted of a fresh issue of Rs 200 crores and an offer for sale of 44,47,630 shares. The issue was subscribed 93.81 times overall with QIB portion subscribed 197.29 times, HNI portion subscribed 130.93 times and Retail portion subscribed 19.5 times. There were 24.42 lakh applications in all. 

The second issue to tap the capital markets was Orient Technologies Limited which opened its issue on Wednesday the 21st of August and closed on Friday the 23rd of August. The issue consists of a fresh issue of Rs 120 crores and an offer for sale of 46 lakh shares, in a price band of Rs 195-206. The company is an information technology (IT) solutions provider headquartered in Mumbai. The company reported revenues of Rs 602.89 crores for the year ended March 24 with an EBITDA margin of 9.39% and a PAT margin of 6.87%. Their EPS for the year was 11.80 and the PE band is 16.53-17.46. The company has entered the promising and lucrative business of cyber security which is a crucial and fast-growing area and also enjoying higher margins. The issue was subscribed 154.87 times overall with QIB portion subscribed 188.79 times, HNI portion subscribed 310.07 times and Retail portion subscribed 68.98 times. There were 29.26 lakh applications. 

With a larger number of participants making money in the markets, the system is flush with liquidity and one therefore is witnessing huge subscriptions in the primary markets and entire selling of FPIs being absorbed in the market as well. While Quarter one results were overall poor, witnessing the lowest growth in eight quarters, there has been no impact on markets whatsoever. While this is a cause of concern, the market mood and sentiment are not only positive but extremely buoyant.  

There are two issues opening and closing in the week ahead. The first is from Premier Energies Limited which is opening on Tuesday the 27th of August and closing on Thursday the 29th of August. The issue consists of a fresh issue of Rs 1,291.4 crores and an offer for sale of 3.42 crore shares in a price band of Rs 427-450. 

The company is an integrated solar cell and solar module manufacturer with 29 years of experience. The company makes PV (photovoltaic) cells and also manufactures solar modules. The company reported revenues of Rs 3,143.79 crores for the year ended March 24 and a profit after tax of Rupees 231.36 crores. In the first quarter of the current year, it reported revenues of Rs 1,657.36 crores and a profit after tax of Rs 196.16 crores. The EPS for the year ended March 24 was Rs 6.93 while on a fully diluted basis it was Rs 5.48. The PE ratio on this EPS is 77.92-82.12. If one looks at the EPS earned by the company in the first quarter after new capacities were added towards the end of the financial year 2024, the same has improved significantly to Rs 5.93 and on a fully diluted basis to Rs 4.70. This is significantly higher than the previous full year’s EPS of Rs 5.48. 

The company is expanding its capacity with its own money as well as the objects of the issue also include expansion. This looks like a good opportunity to participate in a large capacity solar company which is an integrated player and has size and scale besides the experience. One should invest for the medium to long term in the company. 

The second company to tap the markets is ECOS (India) Mobility and Hospitality Limited. The company is offering 1.8 crore shares through an offer for sale in a price band of Rs 318-334. The issue opens on Wednesday the 28th of August and closes on Friday the 30th of August. 

The company offers chauffeur driven mobility providers to corporates in India. The company reported revenues of Rs 554.41 crores for the year ended March 24 and a profit after tax of Rs 62.53 crores. The EPS for the year was Rs 10.42 and the PE band is 30.52-32.05 times. The growth of the company over the last three years has been phenomenal and one wonders whether this growth is sustainable or not. 

Besides the IPOs, PE investors are raising money through secondary markets and every week we witness a number of transactions where shares are sold through bulk deals. Everything on offer gets mopped up and there is no dearth of demand. 

Coming to the markets in the week ahead which has August futures expiring on Thursday the 29th of August, markets would be volatile and choppy. The present value of August series is higher by 417.05 points or 1.71% at 24,823.15 points. The lifetime highs on intraday basis and closing basis were made on Thursday the 1st of august. These levels were at 25,078.30 points and 25,010.90 points on NIFTY and at 82,129.49 points and 81,867.55 points on BSESENSEX. We have closed at 81,086.21 points and 24,823.15 points on BSESENSEX and NIFTY respectively, implying that we are a mere 1,050 points away on BSESENSEX and just under 200 points on NIFTY. This week appears to be the best time to make yet another attempt at creating new highs and going even higher. 

So previous tops become immediate objectives and markets have the follow through momentum post the Jackson hole event in the US and a sharp 462 point rally on Friday. On the support side levels of 24,500 around and 80,000 points are decent supports and should hold. The week ahead has two listings as well besides a spate of roadshows and issues opening and closing. With liquidity bursting at the seams and no dearth of the same, the setting is all in place for an imploding week at the markets. 

In conclusion, trade cautiously as the possibility of post a new high, markets again correct as they did post 1st August.