rediffGURU Ulhas Joshi recommends five factors you need to look at to evaluate the performance of two schemes.
Retail investors now own a bigger slice of small-cap companies than a couple of years earlier, attributable to their growing conviction in mutual fund (MF) schemes focused on this space. Data from Capitaline shows MFs' average holding in the National Stock Exchange Nifty Smallcap 250 rising to 8.67 per cent, from 7.67 per cent in the past two financial years, with the number of companies with over 20 per cent MF holdings, rising from 15 to 24. At the end of May, the top five small-cap firms with the highest MF holdings were Carborundum Universal, Blue Star, Cyient, Gujarat State Petronet, and Cholamandalam Finance.
rediffGURU Dev Ashish answers your personal finance and mutual fund queries.
With the Nifty50 surging past the 20,000 mark, the markets are experiencing a spate of initial public offerings (IPOs) with four issues set to raise over Rs 4,673 crore this week. Another quartet, cumulatively worth Rs 3,000 crore, is expected to launch next week. Companies like RR Kabel, SAMHI Hotels, Zaggle Prepaid Ocean Services, and Yatra Online are set to hit the primary market this week, while Signature Global, Updater Services, Sai Silks (Kalamandir), and Vaibhav Jewellers are slated for next week. This flurry of activity is driven by multiple factors including buoyant market conditions, increased demand for IPOs, and specific rule on the disclosure of quarterly financials.
Asian Paints dropped the most by 1.33 per cent. IndusInd bank fell 1.2 per cent, Axis Bank by 1.19 per cent, SBI by 1.12 per cent, Bajaj Finance by 1.07 per cent, Nestle by 1.04 per cent, and TCS by 0.97 per cent. Hindustan Unilever, Reliance Industries, Power Grid and Kotak Bank also retreated. Maruti Suzuki was the lead gainer, rising by 2.22 per cent.
Two equity funds at the opposite ends of the risk matrix - small-cap and arbitrage - bucked the 'low inflow' trend in May this calendar year 2023 (CY23) to receive the highest net inflows in recent years. The Rs 3,280-crore net inflows into small-cap schemes in May was the highest for the category since the mutual fund (MF) industry started releasing fund-wise inflow data in April 2019. Arbitrage schemes raked in a net Rs 6,640 crore - the highest since July 2021.
Water projects firm Vishnu Prakash R Punglia, the 20th company to launch its IPO in the current year, saw its shares closing at a 47 per cent gain over its issue price on Tuesday. Such a huge one-day pop is considered rare; however, it has become the norm this year. The average listing-day gain for these 20 IPOs in 2023 is 34 per cent, and their average gain to date stands at 46 per cent.
The rumour verification process would now be triggered by changes in price or 'material price movements', as the paper defines it. What this means is that companies would need to verify rumours only if the share price moves significantly.
The sharp jump in shares of Kalyan Jewellers (Kalyan) has surprised many on the Street; however, analysts believe more steam could be left in the stock as the Thrissur-based gold retailer pivots to a new asset-light network expansion model. Kalyan's stock has surged 62 per cent in the past month, even as the S&P BSE SmallCap Index has gained just 5 per cent. In its latest business update, the company said its consolidated sales grew more than consensus expectations at 31 per cent year-on-year, led by strong domestic sales regardless of the volatility in gold prices.
The slowdown in corporate revenue growth over the last one year has begun to reflect in India Inc's capital expenditure, or capex. The country's top listed companies are going slow on fresh investment in capacity expansion, in line with a deceleration in their top line growth. The combined fixed assets of the listed companies, excluding banking, finance services and insurance (BFSI) and the government-owned oil & gas firms, were up 10.1 per cent year-on-year (Y-o-Y) during April-September 2023 (H1FY24) - the slowest in 18 months - as against 21.1 per cent Y-o-Y growth in H2FY23 (October 2022-March 2023) and 11.6 per cent growth in the April-September 2022 period (H1FY23).
From the Sensex pack, Larsen & Toubro jumped 4.26 per cent to emerge as the biggest gainer, followed by IndusInd Bank, Tech Mahindra, State Bank of India, HCL Technologies, Power Grid, NTPC, Axis Bank, Kotak Mahindra Bank, HDFC Bank and Wipro. Mahindra & Mahindra, Infosys, UltraTech Cement and Hindustan Unilever were the major laggards.
The market capitalisation of BSE-listed firms reached an all-time high of Rs 299.90 lakh crore on Wednesday despite the Sensex falling marginally after a remarkable record-breaking rally in the last few trading sessions. The 30-share BSE Sensex dipped 33.01 points or 0.05 per cent to settle at 65,446.04, after rallying in the past five trading straight sessions. During the day, the benchmark hit a low of 65,256.49 and a high of 65,584.33.
Among the main gainers were Jio Financial Services which jumped 4.99 per cent, Tata Steel (2.09 per cent), Maruti Suzuki (1.87 per cent), M&M (1.31 per cent) and Infosys (1.19 per cent).
Wall Street-correlated stock markets are facing the risk of correction, as Christopher Wood, the global head of equity strategy at Jefferies, conveys to investors in his latest edition of GREED & fear. Rising crude oil prices, which are nearing $100 a barrel (Brent), pose a threat to the global central bank's battle against inflation and have led to a re-evaluation of its exposure to Indian stocks. "The potential for more US Federal Reserve (Fed) rate hikes, combined with the risk that monetary tightening finally bites as regards the economy, remains a risk for Wall Street-correlated world stock markets. "There is also the oil factor. This is why GREED & fear continues to believe the pain trade is down. "Areas in Asia, such as Indian midcaps, which have already done very well, are at obvious risk of some profit-taking," writes Wood.
'A cutback in hiring and compensation growth by IT companies will have a significant impact on consumer demand, especially in the urban sector of the economy.'
From the Sensex pack, IndusInd Bank, NTPC, Asian Paints, Hindustan Unilever, JSW Steel, Tech Mahindra, Bajaj Finance, Infosys, Wipro, ICICI Bank, Bajaj Finserv, HDFC Bank and Tata Motors were among the major laggards. HCL Technologies, Power Grid, Titan, Reliance Industries, UltraTech Cement, Tata Steel, State Bank of India and Mahindra & Mahindra were the gainers.
Bajaj Finance led the Sensex gainers' chart, spurting up to 2.38 per cent, followed by Bajaj Finserve rising 2.11 per cent and IndusInd Bank closing 1.66 per cent higher. Bharti Airtel, SBI and L&T increased by 1.60 per cent, 1.28 per cent and 0.92 per cent, respectively.
'Some risks to this market rally include inflation, erratic weather conditions, rising crude prices, slowing global growth and the resultant impact on domestic exports, escalation in geopolitical tensions.'
The net inflows into active equity mutual fund (MF) schemes registered more than a twofold month-on-month rise in August, crossing Rs 20,000 crore, the highest in five months. This rise in net inflows was boosted by an 18 per cent growth in gross investments, driven by a record Rs 15,800 crore inflow through the systematic investment plan (SIP) route and Rs 5,000 crore collected by seven new fund offers (NFOs) in the active equity space, reveals data released by the Association of Mutual Funds in India (Amfi). Moreover, redemptions moderated in August, declining by 19 per cent to Rs 24,580 crore, after staying elevated in the previous three months owing to profit booking.
The benchmark indices are set to end their five-month gaining streak, but the market breadth continues to hold strong So far this month, stocks gaining have outnumbered those declining, a sign that the bulls still have the upper hand, even as the pullback in the S&P BSE Sensex and the National Stock Exchange Nifty indicates otherwise. On the BSE, 2,126 stocks have advanced and 1,955 have declined in August, translating into an advance/decline ratio (ADR) of 1.1.
Investors' wealth eroded by Rs 3.46 lakh crore on Wednesday as equity markets took a sharp tumble amid weak global trends and foreign fund outflows. The 30-share BSE Sensex fell by 676.53 points or 1.02 per cent to settle at 65,782.78. During the day, it plunged 1,027.63 points or 1.54 per cent to 65,431.68. In line with the weak trend in equities, the market capitalisation of BSE-listed firms eroded by Rs 3,46,947.54 crore to Rs 3,03,33,258.69 crore.
'We suggest an equity strategy of 5% to 10% exposure to cash, 5% to Gold ETF, close to 50% to Sensex/Nifty/large mid-cap stocks.'
From the Sensex pack, Infosys tanked over 8 per cent after the company reported a lower-than-expected 11 per cent rise in net profit for the June quarter and delivered a shocker as it slashed its FY24 growth outlook to 1-3.5 per cent on delayed decision-making by clients amid global macro uncertainties. Hindustan Unilever, HCL Technologies, Wipro, and Tech Mahindra were the other major laggards. On the other hand, Larsen & Toubro rose the most by 3.88 per cent after it bagged an order of worth over Rs 7,000 crore from the bullet train project.
Equity benchmark index Sensex buckled under selling pressure for the second straight session to close below the 65k mark on Friday, as investors offloaded IT, teck and metal stocks amid a bearish global trend. Besides, fresh foreign fund outflows also hit investor sentiments, traders said. In a volatile trade, the 30-share BSE Sensex declined 202.36 points or 0.31 per cent to settle at 64,948.66.
Public-sector enterprise stocks have seen a good run thus far in 2023-24 (FY24), with the S&P BSE PSU Index surging by over 26 per cent during the period, compared to an 11 per cent increase in the benchmark S&P BSE Sensex.
Mutual funds focused on small-caps have emerged as the winner with a net inflow of close to Rs 11,000 crore in April-June quarter, as fund managers struggle to create alpha in the large-cap space, and the trend is expected to continue for some time. On the other hand, large-cap space, which is yet to pick up momentum, witnessed an outflow of Rs 3,360 crore during the quarter under review, data from the Association of Mutual Funds in India (Amfi) showed. Apart from the June quarter, small-cap funds logged an inflow of Rs 6,932 crore in three months that ended in March.
The move to demerge the hotel business into a separate entity by ITC has brought back focus on hotel stocks, which have already seen a good run thus far in fiscal 2023-24 (FY24). Analysts believe there could be more gains in store over the next one year for the stocks in this sector, but suggest investors put in money on a correction only from a long-term perspective. Hotel stocks, according to A K Prabhakar, head of research at IDBI Capital, have seen a good run as travel picked up post Covid in India. Not only have the room rents increased, the occupancy, too, has surged.
SBI was the biggest loser in the Sensex pack, tumbling 2.83 per cent, followed by Infosys, TCS, Bajaj Finance, Tech Mahindra, Wipro and Axis Bank. In contrast, Titan, L&T, NTPC, Power Grid, Sun Pharma, ITC and HDFC twins were among the prominent winners, rising as much as 1.97 per cent.
The 55 basis point (bps) spike in the US 10-year bond yield, triggered by a combination of FOMC's hawkish commentary and BOJ's relaxation of the yield control curve (YCC) has made analysts cautious on Asian equities and expect them to trade sideways in the short-to-medium term.
Rising for the second straight session, equity benchmark Sensex climbed 142 points on Thursday following buying in IT and finance stocks amid a higher opening in European markets. After a see-saw session, the 30-share BSE Sensex ended 142.43 points or 0.23 per cent higher at 60,806.22. During the day, the index witnessed a high of 60,863.63 and a low of 60,472.81.
From the Sensex pack, Infosys, HCL Technologies, Infosys, NTPC, Mahindra & Mahindra, Tata Consultancy Services, Nestle, Tech Mahindra and Bajaj Finance were the major gainers. Power Grid, Larsen & Toubro, Maruti, Titan, HDFC Bank, Wipro, HDFC and ITC were among the laggards.
IndusInd Bank was the biggest gainer on the Sensex chart, rising 4.75 per cent, followed by M&M, L&T, NTPC, ITC, Ultra Cement, Tata Steel, Maruti and SBI. In contrast, Bajaj Finance, Tech Mahindra, Infosys and Sun Pharma were among the losers, shedding up to 2.30 per cent.
HCL Tech was the biggest loser on the Sensex chart, shedding 2.79 per cent, followed by Tata Steel, ICICI Bank, Reliance Industries, ITC, Wipro, Infosys and M&M. In contrast, Tata Motors, L&T, Bharti Airtel, HDFC Bank and SBI were among the winners, climbing up to 2.05 per cent.
Kotak Mahindra Bank was the biggest loser from the Sensex pack, skidding 1.83 per cent, followed by Axis Bank, NTPC, Hindustan Unilever, ICICI Bank, Bharti Airtel, Reliance Industries, HCL Technologies, IndusInd Bank and Nestle. In contrast, Bajaj Finance, Bajaj Finserv, Tech Mahindra, Tata Consultancy Services, Titan, Infosys, HDFC Bank, HDFC and ITC were the gainers.
Stock market minnows put up a stellar show in 2021 giving returns of up to 60 per cent amid Dalal Street dream run and are likely to continue sailing northwards in the New Year too. Trumping pandemic-induced uncertainties, the Indian equity market posted stunning gains this year achieving several feats and smaller stocks benefited the most from the strong momentum. From reaching the momentous 50,000-mark in January to scaling 61,000-level in October, the BSE Sensex had an epic journey this year.
Investors became richer by over Rs 2.27 lakh crore on Monday as equities rebounded, with the BSE Sensex rallying over 1 per cent amid continuous foreign fund inflows and upbeat global markets. The 30-share BSE Sensex jumped 709.96 points or 1.16 per cent to settle at 61,764.25. During the day, it zoomed 799.9 points or 1.31 per cent to 61,854.19. Following the rally, the market capitalisation of BSE-listed firms jumped by Rs 2,27,794.46 crore to Rs 2,76,06,443.06 crore.
HCL Tech led the Sensex gainers' chart, spurting 3.58 per cent, followed by UltraCement, Nestle India, Tata Steel, Kotak Bank, ICICI Bank, Bharti Airtel and HDFC twins. In contrast, ITC, Maruti, NTPC, Asian Paints and Sun Pharma were among the main laggards, shedding up to 1.51 per cent.
IndusInd Bank was the biggest loser in the Sensex pack, shedding 7.46 per cent, followed by SBI, Tata Motors, M&M, Bajaj Finserv, Axis Bank and Infosys. In contrast, Tech Mahindra was the only winner.
Investors became poorer by Rs 1.36 lakh crore on Friday as the markets witnessed a sell-off amid weak global trends. Benchmark stock indices Sensex tanked 671.15 points or 1.12 per cent to close at 59,135.13, as 21 of its scrips declined. The sharp decline in equities eroded Rs 1,36,037.96 crore from the market capitalisation of BSE-listed firms and that now stands at Rs 2,62,94,723.65 crore.
Among the Sensex firms, Bajaj Finserv, Tata Motors, Asian Paints, ITC, IndusInd Bank, State Bank of India, Tata Steel, Wipro, Infosys and Maruti were the major gainers. Tech Mahindra, HCL Technologies, Kotak Mahindra Bank, Titan and Larsen & Toubro were the major laggards.
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