By Dilip Davda
After a long run of losing weeks, the market has finally given some relief. The week started on a negative note and moved both ways. It still closed with a good weekly gain, which belied the fears of a nervous week.
Jio’s debut brings cheers
The big news was Jio Platforms. The mega IPO, the biggest in Indian history, listed at a premium of about 21%. That was a big boost for investor sentiment. Refunds from the issue also came back to the market, and that improved liquidity.
This is a lesson for those who stayed away from the issue because of the noise around it. Geopolitical tension, the Ambani-Musk imbroglio and rivals’ propaganda did not dent the response. As I have said many times, study the business and the pricing, and ignore the rumours.
Markets: a quick look
The market tracked global sentiment, which kept swinging with the US-Iran-Israel and Russia-Ukraine tensions. Crude oil hit a fresh high of 117.50 dollars a barrel by the week’s end, and that remains the biggest worry. A bit of relief came from the US Federal Reserve, which kept rates unchanged. That may bring FIIs back to Indian markets, and market men hope for a better mood in the festival of lights ahead.
The Nifty gained about 1.56% in the last two sessions and closed the week at 23,053, against 22,600 the previous week. That is a gain of 453 points, or about 2%. If it breaks above 23,200 and sustains there, we could see further bullish momentum. If it fails, a reversal is possible.
The Bank Nifty was relatively weak. It closed at 54,823, up 581 points, or about 1.07%. The level to watch for the coming week is 55,300.
Mainboard: BLS Polymers is the star
Four mainboard IPOs opened and closed during the week, and the response was very uneven:
- BLS Polymers: 241.22 times, by far the highest of the week
- SFC Environmental: 9.47 times
- EAAA India: 5.51 times
- M. K. Sons: 5.09 times
Bombay Coated also opened and had received 3.98 times subscription till Friday’s close. It closes on 2 November. For the ensuing week, there is a dry spell for mainboard IPOs.
SME: some response, some caution
On the SME platform, the following issues closed:
- Carver Robo: 25.80 times
- Core4 Engineers: 5.44 times
- Wiscon Industries: 1.17 times
- Ajwa Projects: 1.12 times
Five SME IPOs have opened. They are Antala Industries (0.81 times), Johnsoncab (1.14 times), HGS India (1.16 times), Vectras Enpro (1.20 times) and Maxwell Engineering (4.67 times) as of Friday’s close. All of them close in the coming week. Just one new SME IPO, from Vedant Poly, is lined up for the week.
Listings
On the mainboard, there were two listings:
- Jio Platforms: about +21%
- Paras Healthcare: +3.90%
On the SME platform, there was one listing, Core4 Engineers, which listed at a 20% discount.
So even a 5.44 times subscription ended in a deep discount. It shows once again that a subscription number alone should not drive your decision, and that the SME segment continues to need caution.
Other issues
There was no NCD issue for the week. Shivam Autotech floated one rights issue. For the ensuing week, there is again a dry spell for NCDs, while four rights issues are lined up from Urban Enviro, Veer Global, Fratelli Vineyards and Interactive Financial.
What to expect
The primary market may take a pause in the festive week ahead, and activity will remain low until SEBI finalises its SME rules. Investors should follow caution and do their own due diligence before committing money. As I like to say, GMP is “Grossly Manipulated Price”, so do not lean on it. Every investment in the securities market carries market-related risk, so stay tuned with the times and invest wisely.
