Hindustan Zinc's two-way spinoff on the cards, says chairperson : Daily Market Update -22 Feb 2024 | Globe Capital Market LTD.
Hindustan Zinc’s two-way spinoff on the cards, says chairperson : Daily Market Update -22 Feb 2024

Hindustan Zinc Ltd. will spin off business into two—one each for its zinc or lead and silver units—following recommendations from a panel that was set up to look at unlocking value in the Vedanta Ltd.-owned company.  The company had initially examined a three-way demerger—where its zinc\lead, silver and recycling businesses would be independent units. The company plans to keep its recycling business as a subsidiary. “We want to make the recycling business much bigger,” Hebbar said, adding that they want to be the biggest recycling company in the world because it is important for the future, for sustainability.

Overview and Outlook

Global Stock Market Today

  • Barring DOW, other US equity markets settled on a negative note.
  • Barring FTSE, other European equity markets settled on a flat to positive note.
  • Majority of Asian equity markets are trading in green.
  • GIFT Nifty is up by 100 points, Nifty futures is likely to open around 220150 levels (as on 8:30AM).


News highlights from across the globe

  • Majority of Asian equity markets rose in early trade on Thursday buoyed by gains on Wall Street after Nvidia Corp forecasted better-than-expected sales forecast.
  • The Bank of Korea kept its benchmark seven-day repurchase repo rate unchanged at 3.5% today. The central bank also maintained growth and inflation forecasts.
  • Brent crude was up 0.84% at $83.03 a barrel.


Important news updates from the domestic front

  • Sugar stocks: The government announced hiking the sugarcane Fair and Remunerative Price by Rs 25 to Rs 340 per quintal for the 2024-25 season starting October. FRP is the minimum price that mills have to pay to sugarcane growers.
  • Zee Entertainment Enterprise: SEBI might issue a show cause notice to company next month in a fund diversion case.
  • Axis Bank: Moody’s affirmed the lender’s Baa3 long-term deposit ratings at ‘Baa3’ with a stable outlook saying India’s favorable operating environment offers the bank an opportunity to further strengthen its market position.
  • NBCC received in-principal approval from Greater Noida Authority for the development of unused and purchasable Floor Area Ratio in furtherance of existing projects of Amrapali valued Rs 10,000 crores.
  • Grasim Industries will launch Birla Opus Paints Business and will inaugurate three plants.
  • UPL incorporated step-down subsidiary Advanta Seeds Hungary for seeds business.
  • South Indian Bank announced Rs 1,151 crore rights issue. It will offer 52 crore shares at Rs 22 per share. The issue opens March 6 and closes on March 20 and the record date is set as Feb. 27. The rights ratio set at 1 share for every 4 shares held.
  • LTIMindtree signed an MoU with Eurolife FFH, to establish Gen Al and Digital hubs in Europe and Mumbai.


Nifty Overview & Outlook

The benchmark Nifty index opened with a gap on the higher side but failed to sustain at higher levels and settled sharply lower at 22055 levels after a cut of nearly 150 points from its previous closing values after hitting new all time high i.e. 22249 levels.

Broader markets underperformed the frontline index as Small cap and Midcap indices were down over 1% each against 0.6% decline of the frontline index; resultant, poor market breadth.

Performance on the sectoral front was mix. Amongst them, Nifty Media index was the worst performer tumbled nearly 5% followed by the Nifty IT and Oil & Gas indices that were down by over 1% each. On the other hand, Nifty Realty index witnessed some buying interest and settled over 2% higher.

Going ahead, we expect Nifty index to trade with sideways to positive bias till it is trading above 21800 levels on closing basis and suggest traders to maintain buy on dip trading strategy till it is trading above the said levels.


Derivatives Overview & Outlook

Yesterday, short buildup was seen in Nifty and Banknifty futures with increase in open interest by 1% and 3.5% respectively. Long unwinding was seen in Finnifty futures with decrease in open interest by 15.9%.

On the sectoral front, short buildup was observed in Textile, Media, Technology Automobile and Finance shares, whereas long unwinding was observed in Infrastructure, Pharma and Telecom stocks.

On options front, call writing was seen at multiple strikes and maximum positions are at 21500 PE and closely followed by 22000 PE and 22500 CE closely followed by 22200 CE.


Institutional Trading Activity

Yesterday, FIIs bought stocks worth Rs 285 Cr in the cash segment, sold stocks futures worth Rs 280 Cr and bought index future worth Rs 627 Cr. DIIs were net seller in the cash segment to the tune of Rs 412 Cr.


Nifty Futures, Banknifty Futures and Finnifty Key Levels

Nifty – Resistances 22220-22330; Supports 21930-21800

Banknifty – Resistances 47300-47600; Supports 46700-46400

Finnifty – Resistances 20820-20950; Supports 20550-20400




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