RBI bars Edelweiss ARC from acquiring stressed assets : Daily Market Update -30 May 2024 | Globe Capital Market LTD.
RBI bars Edelweiss ARC from acquiring stressed assets : Daily Market Update -30 May 2024

Reserve Bank of India has stopped Edelweiss Asset Reconstruction Co. from acquiring any stressed assets, according to a supervisory action notification on Wednesday. Edelweiss ARC has been asked to stop acquisition of stressed assets with immediate effect, including security receipts and re-organising the existing SRs into senior and subordinate tranches. In its notification, the regulator also barred ECL Finance from undertaking any structured transactions, with respect to its wholesale exposures, with immediate effect. However, it can continue to conduct repayment and/or closure of accounts.

Overview and Outlook

Global Stock Market Today

  • US equity markets settled lower in range 0.5% to 1%.
  • European equity markets also settled lower in range 1% to 1.5%.
  • Asian equity markets are trading in lower.
  • GIFT Nifty is down by 75 points, Nifty futures likely to open around 22650 levels (as on 8:20AM).


News highlights from across the globe

  • Most of the Asian benchmarks are trading lower on Thursday, tracking similar move in Wall Street after the US Treasury yields increased.
  • The US stock market came under pressure, with traders on high alert before a $44 billion sale of seven-year notes that follows two weak auctions on Tuesday.
  • Brent crude was trading 0.08% lower at $83.53 a barrel.


Important news updates from the domestic front

  • Tata Steel Q4 FY24 (Consolidated, YoY) – Revenue down 6.8% at Rs 58,687 crore versus Rs 62,962 crore. Ebitda down 8.6% at Rs 6,601 crore versus Rs 7,219 crore. Margin at 11.2% versus 11.5%. Net profit down 64.6% at Rs 555 crore versus Rs 1,566 crore. Board recommends dividend of Rs 3.6/share. Board approved issue of NCDs worth up to Rs 3,000 crore on private placement basis.
  • SJVN Q4 FY24 (Consolidated, YoY) Revenue down 4.2% at Rs 483 crore versus Rs 504 crore. Ebitda at Rs 240 crore versus Rs 309 crore. Margin at 49.6% versus 61.3%. Net profit up at Rs 61 crore versus Rs 17 crore.
  • Bata India Q4 FY24 (Consolidated, YoY) Revenue up 2.5% at Rs 798 crore versus Rs 7799 crore. Ebitda up 0.1% at Rs 182 crore versus Rs 182 crore. Margin down 53 bps at 22.8% versus 23.4%. Net profit down 3% at Rs 64 crore versus Rs 66 crore. Board recommends dividend of Rs 12/share.
  • Edelweiss Financial Services: The Reserve Bank of India has stopped Edelweiss Asset Reconstruction Co., the subsidiary of the company, from acquiring any stressed assets, according to a supervisory action notification.
  • SJVN: The company has signed a pact with Indian Oil for JV in renewable, new tech projects.
  • Aditya Birla Capital: The company invests Rs 300 crore in its arm, Aditya Birla Housing Finance, on a rights basis.
  • ONGC: The S&P Global rating changed the outlook from stable to positive. The company has stronger standalone credit profiles.
  • ICICI Bank: S&P Global Ratings has affirmed ICICI Bank’s rating and revised its outlook to BBB-/positive/A-3 from BBB-/Stable/A-3. The bank’s stand-alone credit profile was revised upwards from BBB to BBB+.
  • State Bank of India: S&P Global Ratings has revised the outlook of the bank from stable to positive.



Nifty Overview & Outlook

Benchmark Nifty index opened with a gap on the down side, it kept on sliding throughout the day and settled at 22704 levels after a cut of 183 points from its previous closing values.

Broader markets outperformed the benchmark as Mid cap index was down 0.18% and Small cap index settled on a positive note.

Majority of sectoral indices tracked at NSE settled in red. Nifty Fin Services index was the worst performer, down 1.65% followed by Banking space as it was down 1.3%. On the other hand, Nifty Pharma was at the top of the tally, gained 0.55%.

Going ahead, we expect markets to remain volatile as we are moving closer to the General Election Outcome. Various agencies will come up with the exit polls in the evening on 1st June 2024 followed by votes counting on 4th June 2024. Hence, we suggest traders to keep a check on position size and keep positions hedged.

Derivatives Overview & Outlook

Yesterday, long unwinding was seen in Nifty and Banknifty futures with decrease in open interest by 1.6% and 18.6% respectively, whereas short buildup was seen in Finnifty futures with increase in open interest by 32.6%. No significant changes was seen in Midcap nifty futures on price as well as on open interest front.

Banknifty futures rolled 68% of open interest into next contract which was lower than the previous month rollovers of 74%. Nifty futures rolled 59% of open interest into next contract so far.

On options front, call writing was seen in multiple strikes and maximum positions are at 23500 CE closely followed by 23000 CE and 22500 PE.


Institutional Trading Activity

Yesterday, FIIs sold stocks worth Rs 5842 Cr in the cash segment, sold stocks futures and index futures worth Rs 125 Cr and Rs 1717 Cr respectively. DIIs were net buyer in the cash segment to the tune of Rs 5234 Cr.


Nifty Futures, Banknifty Futures and Finnifty Key Levels

Nifty – Resistances 22850-22900; Supports 22700-22600

Banknifty – Resistances 48700-48800; Supports 48200-48000

Finnifty – Resistances 21900-21950; Supports 21800-21700






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