Tale of the Tape 

Happy weekend y’all. You’ve earned this one!

Markets closed down all five days of the week; wiping out all the gains in the last 1 month. PS - this was also the worst week for stocks in 2.5 years! Midcaps (-2.8%) and Smallcaps (-2.2%) also ended with deep cuts. The market breadth was extremely negative with over 4 stocks falling for every gainer.

It was a sea of red across the board. Not a single sector closed in the green. Real Estate (-3.9%) took the worst beating followed by PSU Banks and IT; down -2.6% each.

SEBI rolled out new rules on asset classes and SME IPOs. Read our top story for how this will affect your investment bets. 

Senores Pharma IPO kicked off today. Check out our analysis to help you decide whether to subscribe.

IT stocks misfired big time despite strong results by IT giant Accenture. LTIMindtree, Mphasis and L&T Technology Services dropped 5%-6% each.

Siemens fell over 10% intraday on concerns over the company’s future growth outlook. Here’s all you need to know.

Sagility India (+3%) bucked the overall weakness after getting the thumbs up from Jefferies. PS - they see a further +15% upside from current levels.

Listing gain. International Gemmological Institute of India closed at Rs 471 p/sh; +13% from its IPO price.

Granules India (-2%) was under pressure after 32 lakh shares (1.3% equity) changed hands in multiple block deals.

BASF India jumped +9% intraday after approving the demerger of its agri solutions business.

MTAR Technologies rose +6% after winning multiple new orders worth Rs 226 cr. KPI Green was locked in a 5% upper circuit; company will set up renewable energy projects in Rajasthan.

Here are the closing prints:

Market
SEBI’s Hard At Work

As we wrap up 2024, SEBI has rolled out some new rules for Indian markets! FYI - Madhabi Buch steps down in March. So this is her swan song and it kinda sums up what the regulator has been trying to do for the last few years. Here’s what you need to know:

First up is new asset classes. It gets less attention, but SEBI does want newer & better investment channels. It’s now proposed a new category called ‘specialised investment funds (SIFs)’, which will sit between mutual funds and PMS schemes with a minimum investment of Rs 10 lakh. FYI - most importantly, SIF managers can invest up to 15% in a single security (vs 10% allowed for MFs). Investment limits are also doubled for REITs (real estate) and INVITs (infra) up to 20%. Experts say this will allow for concentrated & thematic bets; PMS’s do this, but they usually require a minimum investment of Rs 50 lakh!

Next we have the SME IPO crackdown. SEBI has been waging this war for sometime and it finally pulled the trigger. It’s looking to curb the three biggest avenues of fraud by requiring profitability (at least Rs 1 cr in the last 2-3 years), capping the OFS limit (no more than 20% of issue size) and not allowing IPO proceeds to be used to repay promoter or related party loans. 

Most experts agree that this is a good move, but analysts are less sure about a profitability requirement. After all, if the purpose of IPOs is for companies to get growth capital, which for some includes sustaining their cash burn as their strategy falls into place. Mandating pre-listing profits could just straight up discourage new-age or innovative SMEs! 

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