9:44 am Inflow from EPFO: Emerging as a significant source of investments into capital markets, Employees Provident Fund Organisation (EPFO) is likely to pump in Rs 25,000-30,000 crore in equities in 2017-18 with Rs 5,700 crore already invested this year so far, says a report.
According to global brokerage Morgan Stanley, besides EPFO, the National Pension Scheme (NPS) is also among the sources for driving the domestic flow surge, which has been positive for the past 17 months.
“NPS’ pension assets stood at USD 30 billion at the end of July. We estimate their equity assets to be at USD 3.5 billion,” the report said.
The report noted that EPFO, which has raised its equity allocation to 15 percent in the current fiscal from 10 percent in 2016-17, is “likely to invest Rs 250-300 billion in equities in 2017-18 of which Rs 57 billion has been invested this year thus far”.
In August, equity flows were positive for the 17th straight month.
Year-to-date, domestic mutual funds have received equity inflows of USD 18.6 billion (tracking at USD 2.3 billion per month).
“By the end of the month, equity mutual fund assets under management (AUM) stood at USD 111 billion, and as a percentage of market cap rose to 5.3 percent, its highest level since July 2000,” Morgan Stanley said.
“Similarly, equity ETF assets rose to new highs of USD 8.4 billion. Year-to-date, ETF inflows stood at USD 2.6 billion (Rs 169 billion),” it added.
9:35 am Buzzing: Shares of Punj Lloyd added as much as 8.3 percent in early trade as it has received a letter of award of Rs 870 crore.
The company has been issued the letter of award (LOA) in respect of construction and commissioning of balance/left out canal work including cross drainage structures & design for Gosikhurd National Project in Bhandara, Nagpur and Chandrapur districts of Maharashtra for VIDC, Phase – I / Pkg – I by NBCC India.
On Thursday, the share closed with a gain of more than 19 percent after its joint venture bagged Rs 1177-crore project from the National Highways Authority of India in Myanmar.
9:30 am Rupee strong: The Indian rupee appreciated sharply in morning trade on dollar weakness.
It was trading at 63.87 against the US dollar, up 17 paise from Thursday’s closing of 64.05.
Bhaskar Panda of HDFC Bank said the dollar weakness continued due to various risks..
9:25 am IPO: ICICI Lombard General Insurance Company set Rs 651-661 as the price band for its initial public offering (IPO), which will make it a Rs 5,700-crore issue.
“The price band has been set at Rs 651-661. At the upper end of the band, it will raise Rs 5,700 crore,” a source said late in the evening.
The issue, the first by any general insurance company, hits the market on September 15. The roadshows are kicking off tomorrow in the financial capital.
Sources said the company promoters will dilute their holding by 19 per cent as part of the issue.
At present, its shareholders include largest private sector lender ICICI Bank and the Canadian Fairfax Financial Holdings.
Over 8.6 crore equity shares will be sold as part of the IPO, which will include ICICI Bank selling over 3 crore shares and the rest from Fairfax.
9:15 am Market Check: Equity benchmarks opened last day of the week on a positive note amid consolidation, with the Nifty reclaiming 9,950 level.
The 30-share BSE Sensex was up 89.87 points at 31,752.61 and the 50-share NSE Nifty gained 23.75 points at 9,953.65.
Nifty Midcap hit record high. About 784 shares advanced against 247 declining shares on the BSE.
Future Market Networks, Future Enterprises and Future Consumer surged up to 10 percent.
Apex Frozen Foods gained another 3.5 percent, rising since listing on Monday.