RBI allows LIC to acquire up to 9.99% stake in HDFC Bank: Daily Market Update -29 Jan 2024 | Globe Capital Market LTD.
RBI allows LIC to acquire up to 9.99% stake in HDFC Bank: Daily Market Update -29 Jan 2024

The Reserve Bank of India has allowed Life Insurance Corp of India to acquire as much as 9.99 percent of HDFC Bank, the country's largest private lender told stock exchanges on January 25. "LIC has been advised by RBI to acquire the aforesaid major shareholding in the Bank within one year i.e. by January 24, 2025," HDFC Bank said in an exchange filing. "Further, LIC must ensure that the aggregate holding in the Bank does not exceed 9.99 percent of the paid-up share capital or voting rights of the Bank at all times," said HDFC Bank. LIC owns a 5.19 percent stake in the bank, according to the lender's shareholding pattern as of December 31.

Overview and Outlook

Global Stock Market Today

  • US equity markets settled on a flat to negative note.
  • European equity markets ended higher in range 0.28% to 2.23%
  • Majority of Asian markets are trading in green.
  • GIFT Nifty is up by 110 points, Nifty futures are likely to open around 21640 levels (as on 8:30AM).


News highlights from across the globe

  • Asian markets are trading higher on Monday as market participants looked forward to the rate decision by the Federal Reserve, scheduled for release on Wednesday.
  • Wall Street traders pushed U.S. stocks toward another all-time high on speculation the Federal Reserve will be able to engineer a soft landing as the U.S. economy remains fairly resilient and inflation shows signs of cooling, Bloomberg reported.
  • Brent crude was trading 0.48% higher at $83.95 a barrel.


Important news updates from the domestic front

  • Vedanta Q3 Earnings FY24 (Consolidated, YoY) – Revenue up 4.2% at Rs 35,541 crore vs Rs 34,102 crore. Ebitda up 20.7% at Rs 8,531 crore vs Rs 7,067 crore. Margin up 328 bps at 24% vs 20.72%. Net profit down 7.2% at Rs 2,868 crore vs Rs 3,091 crore.
  • Cyient Q3 Earnings FY24 (Consolidated, QoQ) – Revenue up 2.4% at Rs 1,821.4 crore vs Rs 1,778.5 crore. EBIT up 0.1% at Rs 326.1 crore vs Rs 325.8 crore. Margin down 41 bps at 17.9% vs 18.31%. Net profit down 16.6% at Rs 153.2 crore vs Rs 183.6 crore.
  • Shriram Finance Q3 Earnings FY24 (Standalone) – Revenue from operations up 17.26% YoY at Rs 8.922.39 crore vs Rs 7,608.83 crore. Net profit up 2.3% YoY at Rs 1,818.3 crore vs Rs 1,777 crore. Gross NPA at 5.66% vs 5.79% QoQ. Net NPA at 2.72% vs 2.80% QoQ.
  • Adani Power Q3 Earnings FY24 (Consolidated, YoY) – Revenue up 67.3% at Rs 12,991.4 crore vs Rs 7,764.4 crore. Ebitda at Rs 4,645.3 crore vs Rs 1,469.7 crore. Margin up 1682 bps at 35.75% vs 18.92%. Net profit at Rs 2,738 crore vs Rs 8.8 crore. Prepaid long-term debt worth Rs 810 crore during Q3FY24 & Rs250 crore during Jan. 2024.
  • HDFC Bank- Life Insurance Corp. has received the Reserve Bank of India’s nod for acquiring up to a 9.99% stake in HDFC Bank Ltd.
  • Adani Green Energy raised Rs 2,337.5 crore via issuance of warrants. The warrants were allotted to Ardour Investment Holding on a private placement basis.
  • Adani Power entered into a Memorandum of Understanding to sell two wholly owned subsidiaries to AdaniConnex Pvt. for Rs 540 crore. The power major will sell a 100% stake in Aviceda Infra Park Ltd. for Rs 190 crore and Innovator Buildwell Pvt. for Rs 350 crore to AdaniConnex.
  • DLF entered a pact with three lenders for the purchase of bonds with Rs 600 crore face value. It entered a pact with Standard Chartered Bank, DB International (Asia) and Deutsche Investments India for a total consideration of Rs 825 crore.
  • Laurus Labs will form a 49:51 joint venture with Slovenia’s Krka Pharma in Hyderabad.
  • SJVN won the GUVNL auction for the 100 MW Solar Project at Rs 2.54 per unit on a build-own and operate basis through a tariff-based competitive bidding process of GUVNL Phase XXI.


Nifty Overview & Outlook

Benchmark Nifty index ended lower at 21352 levels, down over 100 points from its previous closing values after a volatile trading session.

Nifty Midcap index underperformed the benchmark as it was down nearly 1% while Small cap index outperformed the benchmark, up 0.5%.

Performance on the sectoral front was mix. Amongst them, Nifty IT index was the worst performer down over 1.5% followed by the Pharma and FMCG indices that were down over 1 % each. On the other hand, Nifty Realty index witnessed some buying interest and settled over 0.5% higher.

Going ahead, we expect Nifty index to trade with sideways to negative bias till it is trading below 21600 levels on closing basis and suggest traders to maintain sell on rise trading strategy.


Derivatives Overview & Outlook

Last Thursday, long unwinding was seen in Nifty futures with decrease in open interest by 14.4%, whereas short buildup was seen in Banknifty and Finnifty futures with increase in open interest by 0.6% and 31.3% respectively.

Nifty futures rolled 81% of open interest into next contracts which was higher than the previous month rollovers of 79% while Banknifty futures rolled 77% of open interest into next contracts which was lower with previous month rollovers of 81%.

On options front, Nifty will start the first weekly contract of February series with maximum positions at 22500 CE and 20000 PE closely followed by 21000 PE.


Institutional Trading Activity

Last Week, FIIs sold stocks worth Rs 12194 Cr in the cash segment, sold stocks futures and index future worth Rs 4208 Cr and Rs. 5925 Cr respectively. DIIs were net buyer in the cash segment to the tune of Rs 9707 Cr.


Nifty Futures, Banknifty Futures and Finnifty Key Levels

Nifty – Resistances 21700-21850; Supports 21300-21150

Banknifty – Resistances 46000-46500; Supports 44850-44370

Finnifty – Resistances 20430-20670; Supports 19980-19780


F&O Securities in Ban Today  – NIL.




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