Volatile markets likely to drift

MARKETS remained virtually flat in the last five trading sessions on a net basis. They lost ground on Thursday and Friday, opened strong on Monday but closed with small gains or just about flat and ended the week with gains on Tuesday and Wednesday. On a weekly basis, the BSE Sensex lost 165.14 points or 0.32 per cent to close at 51,279.15 points. NIFTY lost 70.80 points or 0.47 per cent to close at 15,174.80 points. Markets have been very volatile and very clearly there is no trend. This makes trading in the market that much difficult.

The primary market is going great guns with issues coming at a faster pace than investors can handle. Friday saw the shares of Heranba Limited list on the bourses. The company had issued shares at Rs 627 and shares after opening at Rs 900, closed at Rs 812.25. The gains made on day one was Rs 185.25 or over 29.55 per cent.

The issue from MTAR Technologies Limited received overwhelming support and was subscribed over 200 times. The company had tapped the markets with a fresh issue of 21.48 lakh shares and an offer for sale of 82.24 lakh shares in a price band of Rs 574-575. The QIB portion was subscribed 165 times, HNI portion was subscribed 650 times and Retail portion was subscribed 28.40 times.

Nureca Limited which had listed ten days ago, has completed the period when it trades in trade-to trade segment and would from Friday trade in the normal segment. It would be interesting to see how this share trades from heron. At this point it is trading around Rs 630-635, which is lower than the first days 666 and the highest of Rs 760.

The IPO of Easy Trip Planners Limited which closed today saw the issue get subscribed 160.19 times. QIB portion was subscribed 77.95 times, HNI portion was subscribed 384.26 times and Retail portion was subscribed 70.78 times. There were 19.95 lakh applications and on the basis of forms the issue was subscribed 58.52 times.

There are three issues opening in the next three days as Thursday the 11th March is a bank holiday. The first is from Anupam Rasayan Limited which is tapping the markets with its fresh issue to raise Rs 760 crore in a price band of Rs 553-555. The issue opens on Friday the 12th March and closes on Tuesday the 16th March.

The second issue is from Laxmi Organics Limited, which is looking to raise Rs 600 crore consisting of a fresh issue of Rs 300 crore and an offer for sale of Rs 300 crore in a price band of Rs 129-130. The company is in the business of Acetyl Intermediates and Speciality Intermediates. It is in the process of entering the fluorochemicals business, having acquired a plant from Italy. The issue opens on Monday the 15th March and closes on Wednesday the 17th March.

The third issue opens and closes on the same dates of 15th and 17th March and is from Craftsman Automation Limited. The issue consists of a fresh issue of Rs 150 crore and an offer for sale of 45.21 lakh shares in a price band of Rs 1488-1490. The company is into the business of power train, Aluminium products used in the automobile industry and industrial engineering.

While these are just three issues, the March IPO madness has just begun and by the time the financial year ends on 31st March there maybe half a dozen more issues happening.

Markets are still looking to find a trend for themselves. While the indicators show that the market technicals look oversold and therefore there is no major correction currently happening. At the same time bulls are in no hurry to push the market as well. In this see-saw battle expect the markets to continue to move aimlessly for another six to seven trading sessions. This would lead us to the setting for the March expiry. Trade cautiously in a volatile and both sided movement market.

(The author is the founder of Kejriwal Research and Investment Services, an advisory firm)