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Markets Today with EZWealth – 1 Oct, 2021
[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]Nifty continues the downward rally after opening gap down
17500 has been breached and the currently trading at 17460 levels; support can be seen at 17430 – 17340; all sector indices in the red
[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_single_image image=”67821″ img_size=”large” alignment=”center”][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]The price of domestic produced natural gas been hiked to $2.9 per million British thermal units (mBtu) for the October 2021-March 2022 period. The ceiling price of Natural produced from deep-water, ultra-deep-water and high pressure-high temperature has also been hiked to $6.13 mBtu. These prices have almost doubled from the price determined by the government for the April September 2021 period.
The current prices put significant pressures on upstreamness of exploring and producing natural gas. ONGC, Oil India, Reliance Industries, BP and Cairn Oil and Gas (a unit of Vedanta) are some of the prominent players that will benefit from a higher gas price.
The margin pressure on city gas distribution (CGD) companies such as Indraprastha Gas (IGL), Mahanagar Gas (MGL) and Gujarat Gas is mounting due to a sharp rally in international gas prices. These stocks have dropped by 7-12 per cent in the past fifteen days amid the rising cost burden and shrinking price discount of gas over liquid fuels. With rising oil and gas prices, investors may find upstream oil and gas stocks more lucrative than the CGD stocks.
A trade is evident in Indraprastha Gas Ltd. A trigger that may fasten the process is a revision in distribution gas prices to offset the rise in commodity price. The stock can be bought between 510-530 levels with a SL at 500 levels and target for 600 levels
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A power crunch across China has rippled from factory floors to homes, crimping growth forecasts for the world’s second-largest economy. The shortages, mirrored in Europe and elsewhere, have roiled commodity markets as well. Part of the problem is that the economic rebound after lockdowns lifted has boosted demand, while lower investment by miners and drillers has constrained fossil fuel production. In China, it’s also due to the green agenda.
China’s economic planning agency said that the country, traditionally a major buyer in the world market, will increase coal imports “moderately.” But supplies have been tight, due to the global energy crunch, and prices have climbed to record levels. China stopped buying the highly energy-efficient Newcastle grade from Australia last year amid a political dispute. Rising purchases from Indonesia helped make up for the missing Australian coal this year, but energy demand in Southeast Asia’s biggest economy also soared. Millions of producers that relied on cheap and stable power supplies for decades wouldn’t be happy. In the short term, it might further push up factory gate inflation, which reflects the changes in prices producers charge to wholesalers.
Maruti Suzuki India Ltd., India’s largest carmaker, expects the chip shortage to impact its vehicle production in October, a festive month when demand rises. Production at its plant in Haryana and contract manufacturer Suzuki Motor Gujarat Pvt.’s facility in Gujarat is likely to fall owing to a supply constraint of electronic components due to the semiconductor shortage situation. The carmaker had temporarily halted production for three consecutive Saturdays in August and cut two shifts to one as the semiconductor shortage deepened. In September, it reduced the output by 40%. The chip crunch began in December last year as sale of laptops and mobile phones to televisions soared with people working remotely during the pandemic. Now rising Covid-19 cases in key supplier markets such as Malaysia has deepened the problem
Tata Group is likely to have emerged as the winner of the Air India bid with the panel of ministers giving its final approval, Bloomberg reported. Tatas are believed to have submitted a higher bid than rival Ajay Singh of SpiceJet. The Tata bid is about Rs 3,000 crore higher than the reserve price set by the government and about Rs 5,000 crore more than the bid by Singh, a report in this newspaper cited sources as saying.
India and Australia are looking to finalise a Comprehensive Cooperation Agreement (CECA) by the end of 2022, which will help expand trade between the two nations. Both nations aim to sign an early harvest trade deal by Christmas that will cover areas of immediate interest. Commerce and Industry ministry Piyush Goyal said both countries have set out “ambitious” timelines and targets
Bajaj Auto and Pierer Industrie, its partner in KTM AG announced that they have finalized a plan to simplify shareholding in premium bike maker KTM through a share swap deal. Following this, Bajaj will become an indirect stake-holder in other brands of the Austrian partner – including Husqvarna, GasGas and Ramon. Earlier, Bajaj Auto and Pierer Mobility AG held around 48% and 52% respectively, in KTM AG. After the transaction, the shareholding of PMAG in KTM AG has increased from 51.7% to around 98.2%
The rising prices of crude and coal, which have risen nearly 8% and 15% in the past month, can spoil the party for India Inc as it will face input cost pressures. Cement companies may come under pressure and could try to partially offset thia with price hikes around late October/early November as construction activity resumes after monsoon. A 5% rise in prices of these commodities would mean a 100bps decline in their margins and 3-4% impact on EBITDA. Apart from them, aviation, paints and FMCG companies may also face cost headwinds.
Oyo is looking to raise more than $900 million through fresh issuance of shares while the rest of it would be through secondary share sale via an offer for sale (OFS). In an offer for sale, existing investors sell their stake, in part or fully. Oyo’s draft red herring prospectus (DRHP) is not yet publicly available. This comes at a time when Oyo is also amidst a legal battle with once rival Zo Rooms which is hoping to get an interim stay from Delhi High Court to restrict the SoftBank-backed startup from modifying its cap table, including by way of an IPO.
Escorts posts 25.6% fall in tractor sales at 8,816 units in September. Domestic tractor sales last month stood at 7,975 units as against 11,453 units in September 2020, down 30.4 per cent
Cipla is on the lookout for targets in India and the U.S., its two largest markets, and may partner with smaller firms working on mRNA platforms after the technology came to the fore during the pandemic. Firm’s cash and cash equivalents swelled 33% to 49 billion rupees ($660 million) from March to June as a delta-fueled tsunami ripped across India.
Max Healthcare Institute share price edged higher in the morning session on October 1, a day after SBI Mutual Fund increased its stake in the Delhi-based hospital chain to 6.44 percent. On September 29, HDFC Mutual Fund and SBI Mutual Fund bought 57 lakh shares (0.59 percent equity) and 4.28 crore shares (4.44 percent equity), respectively, in the healthcare company at Rs 350 a share.[/vc_column_text][vc_column_text]
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