Market Expectations for Nifty 50 and Sensex and Intraday Trading Strategy for Thursday
After a day of mixed and choppy trade in Asian markets, the Indian stock market closed lower on Wednesday. The Nifty 50 index declined by 140 points, closing at 19,671 levels, while the BSE Sensex corrected by 551 points, ending at the 65,877 mark. The Bank Nifty index finished 520 points lower at 43,888 levels, with trading volumes on the NSE slightly above the recent average. Notably, the mid-cap index experienced a greater decline compared to the Nifty, and the advance-decline ratio sharply dropped to 0.57:1.
Looking ahead to Thursday’s, 19th Oct,23 trading, Vaishali Parekh, Vice President of Technical Research at Prabhudas Lilladher, suggests that the market sentiment on Dalal Street has weakened slightly, especially with Nifty closing below the 19,700 level. According to the experts at Prabhudas Lilladher, Nifty has a critical support level at 19,600, and breaching this level could lead to increased selling pressure.
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Today’s Nifty outlook, indicates that Nifty faced another setback in its attempt to surpass the resistance levels at 19,850. This led to a significant round of profit booking and a subsequent drop below the 19,700 level, resulting in a weakened bias and a cautious sentiment. From a technical perspective, reiterating what was previously mentioned, the index is likely to find near-term support around the 19,600 level, particularly within the significant 50EMA zone. A breach of this level could trigger heightened selling pressure, with the next major support expected around the 19,200 zone.
In terms of specific stock recommendations for intraday trading on Thursday, Vaishali Parekh recommends three stocks: Cipla, Himatsingka Seide, and Prestige Estate.
Suzlon Energy’s Stock Crosses Rs.30 Mark, Reflecting Strong Interest in Renewable Energy Stocks
In the dynamic realm of renewable energy investments, Suzlon Energy has garnered considerable attention as its stock price recently exceeded ₹30, a milestone not achieved since April 2015. This impressive upswing in renewable energy stocks is driven by substantial order wins and government initiatives aimed at promoting green energy sources.
Suzlon Energy’s stock, valued at ₹7.45 just a year ago, has experienced a remarkable surge of 315.5%, breaking the ₹30 barrier in the latest trading session, a level unseen since April 2015. This exceptional performance commenced in April, with each subsequent month consistently delivering positive returns until September. May stood out with a remarkable rally of 41.6%, closely followed by a 30% return in June.
This strong showing has propelled Suzlon Energy’s market capitalization above ₹42,000, securing its position as the 165th most valuable company in India. Despite this impressive rally, the stock remains 92.66% below its all-time high of ₹422 in January 2008.
The recent surge in Suzlon Energy’s stock price can be attributed to a combination of factors, including successful acquisitions of multiple wind power projects and a robust financial performance. Brokerage firms have also maintained a positive outlook on the company, citing its substantial order book and a turnaround in financial performance.
Day 1 of IRM Energy IPO: Subscription Reaches 82%; Retail Segment Fully Subscribed
IRM Energy, a city gas distribution company, launched its initial public offering (IPO) on October 18, drawing robust interest from investors on its opening day. Here’s an overview of the IRM Energy IPO’s subscription status, Grey Market Premium (GMP), and other key details:
IRM Energy IPO Subscription Status: The IPO of IRM Energy saw an initial subscription rate of 82% on the first day of the bidding process. Investors submitted bids for 62.35 lakh equity shares, compared to the total of 76.24 lakh shares on offer, as reported by the NSE at 1:50 pm. Notably, the retail category was oversubscribed 1.15 times, and the Non-Institutional Investors’ (NII) category was oversubscribed 1.22 times. Qualified Institutional Buyers were yet to participate in the bidding.
Know what is an IPO? https://financetalks.co.in/ipos-a-beginners-guide-to-initial-public-offerings/
IRM Energy IPO GMP Today: On the first day, the Grey Market Premium (GMP) for IRM Energy Limited IPO stood at ₹75 per share. This indicates that IRM Energy shares were trading at a premium of ₹75 in the grey market on Wednesday, according to market observers. Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price for IRM Energy shares was projected to be ₹580 per share, representing a 14.86% increase over the IPO price of ₹505.
IRM Energy IPO Details: IRM Energy specializes in developing natural gas distribution projects for various user segments, including residential, commercial, industrial, and automotive customers in specific geographic regions. The company’s promoters are Cadila Pharmaceuticals Limited, Dr. Rajiv Indravadan Modi, and IRM Trust. The IPO aims to raise ₹545.40 crore through the issuance of 1.08 crore fresh equity shares with a face value of ₹10 each; there is no offer for sale (OFS) component. The IPO price band ranges from ₹480 to ₹505 per equity share, with a lot size of 29 equity shares and multiples of 29 shares thereafter. Retail investors need a minimum investment of ₹14,645.
The company had already raised ₹160.35 crore from anchor investors on October 17, a day before the IPO subscription opened for bidding. The net proceeds from the IPO will be used for various purposes, including the prepayment or repayment of certain outstanding borrowings, general corporate needs, and funding capital expenditures.
IRM Energy IPO Schedule: The basis of share allotment will be finalized on October 27, with refunds initiated on the same day. Shares will be credited to allottees’ demat accounts on October 30. The anticipated listing date for IRM Energy IPO shares on BSE and NSE is October 31, though there is a possibility of an earlier date if the company opts for the T+3 norm.
IRM Energy IPO Review: While IRM Energy is a promising player in the City Gas Distribution (CGD) sector with a broad customer base spanning three states, it faced profitability challenges in FY23 due to increased costs resulting from geopolitical conflicts, impacting profit margins. Choice Broking commented on the IPO, stating that, at a higher price band, IRM Energy is demanding a trailing twelve-month (TTM) price-to-earnings (P/E) multiple of 29.8x (in relation to its TTM earnings per share of ₹16.9), which is at a premium compared to its peer group average. Considering its subdued profitability and return ratios, the issue is seen as fully priced, and Choice Broking assigned a “Subscribe with Caution” rating to it.