Reliance Retail net debt mounts to Rs 37,500 Cr in FY23 On Capex Push - Daily Market Update- Equity 25 Aug 2023 | Globe Capital Market LTD.
Reliance Retail net debt mounts to Rs 37,500 Cr in FY23 On Capex Push – Daily Market Update- Equity 25 Aug 2023

The net debt of Reliance Industries Ltd.'s retail arm jumped manifold in fiscal 2023, led by aggressive capital expenditure. Reliance Retail Ventures Ltd.'s net debt jumped to Rs 37,500 crore in FY23 from Rs 1,600 crore a year ago, according to the company filings. The rise was driven by a 70% increase in capex to a staggering Rs 51,400 crore. This forms a third of RIL's overall capex. "FY23 capex alone is 85% of the cumulative capex over the previous seven years," Jefferies Financial Group Inc. said in a research note. The cumulative retail segment capex over the last four fiscals was over Rs 1 lakh crore.

Overview and Outlook

Global Market Update

  • US equity markets ended on negative note, up in range 1.08% to 1.87%
  • European equity markets ended on mixed note
  • Asian equity markets are trading on a negative note
  • GIFT Nifty is up by 46 points (as on 8:20AM), Nifty likely to open at 19360.


News highlights from across the globe

  • Asian stocks were set to follow a selloff on Wall Street, with bond yields rising as traders combed through remarks from a slew of Federal Reserve officials. Investors await Jerome Powell’s speech for clues on the interest-rate outlook.
  • The S&P 500 almost wiped out its weekly advance, while losses in the Nasdaq 100 topped 2%.
  • Brent crude was trading above $84 a barrel and the yield on the 10-year U.S. bond was trading at 4.24%.


Important news updates from the domestic front

  • Bharat Electronics: The Ministry of Defence has granted ‘Acceptance of Necessity’ for procurement and installation of electronic warfare suite on Mi-17 V5 helicopters. The EW suite will be procured from BEL.
  • Bharti Airtel gained 14.1 lakh mobile users during June and ended the month with a wireless subscriber base of 37.4 crore, according to TRAI data.
  • Vodafone Idea lost 12.9 lakh subscribers in the wireless category as its mobile subscriber base shrank to 22.9 crore, showed TRAI data.
  • Reliance Industries, EIH: RIL and Oberoi Hotels and Resorts to jointly manage three properties across India and the UK. Properties include Anant Vilas in Mumbai, Stoke Park in the UK and a new project in Gujarat. Reliance Jio added the maximum number of mobile subscribers at about 22.7 lakh, taking its wireless subscriber tally to 43.9 crore users in June, according to TRAI data.
  • DB Realty sold its entire stake in unit Royal Netra Constructions for Rs 2.55 crore to Man Infraconstruction and Platinumcorp Constructions.
  • Garden Reach signed an MoU with DEMPO Group, Goa, to launch a collaboration model to build commercial vessels in their shipyards at Goa and Bhavnagar, Gujarat.
  • Granules India received the approval from Brazilian Health Regulatory Agency (ANVISA), for compliance with the guidelines of Good Manufacturing Practices for its Bonthapally API facility, Hyderabad and Accreditation Certificate of Foreign Drug Manufacturer from Pharmaceuticals and Medical Devices Agency (PMDA), Japan for its Jeedimetla API facility, Hyderabad.


Nifty Overview & Outlook

The benchmark Nifty index ended on a negative note, settled below 19400 levels, down 57 points from its previous closing values after highly volatile trading session.

Midcap index outperformed the benchmark as its nearly up by 0.5% while small cap index performed in line with the benchmark.

Majority of the sectoral indices tracked at NSE settled in red. Amongst them, Nifty Healthcare index led the declines, fell nearly 1% followed by PSU Bank, Pharma and Oil & Gas  indices  that were down over 0.50% each. On the other hand, Nifty IT index witnessed some buying interest, up by 0.61%.

Technically, Nifty index ended on a weak note but formed a indecisive candlestick on a daily chart. Going ahead, cross and sustenance below 19250 levels might take it towards 18800 levels in immediate near term.


Derivatives Overview & Outlook

Yesterday, long unwinding was seen Nifty Future with decrease in open intrest by 1.2%, short covering was seen in Banknifty future and Finnifty future with decrease in open interest by 6.4% and 7.3% respectively.

On the sectoral front, long buildup was seen in Chemical, Infrastructure and Technology stocks whereas short buildup was seen in Banking shares. Initial sign of long unwinding was seen in Capital goods shares.

On options front, Nifty will start the new weekly contract with maximum positions at 19000 PE and 19500 CE.


Institutional Trading Activity

Yesterday, FIIs bought stocks worth Rs 1525 Cr in the cash segment, sold stocks futures and index futures worth Rs. 847 Cr and Rs. 439 Cr respectively. DIIs were net buyer in the cash segment to the tune of Rs 5797 Cr.


Nifty Futures, Banknifty Futures and Finnifty Key Levels

Nifty – Resistances 19480-19560; Supports 19280-19220

Banknifty – Resistances 44820-45050; Supports 44290-44040

Finnifty – Resistances 19880-19940; Supports 19590-19520





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