NIIT shares gained over 4 per cent in the morning trade on Thursday following the company’s plan to establish European Delivery Centre in Dublin, creating 110 jobs over five years. (Express Photo)

NIIT shares gained over 4 per cent in the morning trade on Thursday following the company’s plan to establish European Delivery Centre in Dublin, creating 110 jobs over five years. The development is supported by the Department of Jobs, Enterprise and Innovation through IDA (Industrial Development Agency) Ireland.

At 10.47 am, NIIT shares were trading 4.75 per cent up at Rs 72.75. The scrip opened at Rs 69.45 and had touched a high and low of Rs 74 and Rs 68.30, in trade so far. Sensex was down 0.30 per cent at 25,746.48.

On Wednesday, September 23, the Irish Prime Minister, Enda Kenny said in a joint press statement with Prime Minister Narendra Modi, “ I also welcome the NIIT company here to Ireland with a 110 jobs, with the IDA working strongly in terms of foreign direct investment here.”

The publicly listed company, which was established in 1981 and is headquartered in Gurgaon, India, employs about 3,000 people in over 40 countries with primary locations in India, the United States, Europe and China. The focus of this announcement is NIIT’s Corporate Learning Group (CLG) which delivers comprehensive managed training services including Custom Curriculum Design and Content Development, Learning Administration, Learning Delivery, Strategic Sourcing, Learning Technlogy and Advisory Services.

Ireland was chosen as the location for the new European Delivery Centre due to the availability of suitable creative and technical talent and multilingual skills, the cluster of existing learning technology companies, and open business environment.

In a BSE filing, the company said, “The new roles will include high-end engineers, creative writers and digital media professionals. Other roles will be for trainers, multilingual customer service support and project managers. Applicant can email careers.ireland@niit.com for further information on these positions.”

For the quarter ended June 2015, NIIT Ltd posted net loss of Rs 5.91 crore against net loss of Rs 5.90 crore in the corresponding quarter a year ago.

Stocks in focus: NTPC shares will be in focus after its Rs 700-crore public issue of tax-free bonds was oversubscribed by 11.04 times on the first day of opening on Wednesday.

The BSE Sensex and NSE Nifty opened on a flat note on Thursday ahead of September F&O series that will expire later in the day. At 9.39 am, Sensex was down 51.81 points at 25,771.18. Similarly, Nifty was down 13.40 points at 7,832.55 during the same time.

Stocks that are likely to be in focus today

Balmer Lawrie & Company: The company shares will be in focus after it informed stock exchanges on Wednesday (post market hours) that it will be investing Rs 400 crore in its logistics infrastructure business in the next 24-36 months. The company will be setting up Multi-modal Logistics Hub at Vizag, a project under the MoU signed with Visakhapatnam Port Trust.

NTPC: The shares of state-run company will be in focus after its Rs 700-crore public issue of tax-free bonds was oversubscribed by 11.04 times on the first day of opening on Wednesday.

Coal India: Coal India Ltd, which had estimated a capital expenditure of Rs 60,000 crore to ramp up production to 908 million tonnes, may have to revise it in view of the proposed Land Acquisition Bill. “The current estimate of total capex is Rs 60,000 crore over the next five years. But it may get revised due to Land Acquisition Bill,” Coal India chairman Sutirtha Bhattacharya said at the CIL AGM.

Power Grid Corporation of India (PGCI): The company has received an investment approval for ‘North Eastern Strengthening Scheme-III (NERSS-III)’ at an estimated cost of Rs 133.71 crore, with commissioning schedule of 27 months from the date of investment approval. The board of directors at their meeting held on September 15, 2015 has approved for the same.

Larsen and Toubro: The shares of the company were trading 1.48 per cent down in early trade on Thursday after company’s chairman AM Naik said that the industrial group is looking to sell some assets including roads and infrastructure projects and dilute its stake in non-core subsidiaries to revive performance.

Markets are likely to remain volatile throughout the day as the September F&O series will expire on Thursday and traders will be adjusting their positions. (Photo: PTI)

12.14 am: Hindustan Construction Company (HCC) on Thursday said it has bagged a Rs 1,783.42-crore contract from NHAI for construction of a highway in Jammu & Kashmir (J&K). Cheering the news, the share price of the company jumped 2.52 per cent at Rs 18.30. Sensex was down 21 points at 25,802. Nifty was up 4 points at 7,850.82.

11.46 am: Brokers said squaring-up of positions by participants with Thursday being the last trading session of the September derivatives expiry and a weak trend at other Asian bourses following overnight losses on the Wall Street as weak Chinese and US factory data added to growth worries dampened sentiment. Sensex and Nifty were down 0.25 per cent and 0.12 per cent at 25,757 and 7,836, respectively.

11.28 am: Strides Arcolab shares gained over 3 per cent intra-day on Thursday after Jefferies, a global investment banking firm, inititated coverage with a ‘buy’ rating with a target price of Rs 1,500 per share. The scrip was trading 3.47 per cent higher at Rs 1,258. The BSE Healthcare index was up 1 per cent at 17,660.37. On the other hand, Sensex was down 89 points at 25,733. Nifty was down 17.40 points at 7,828.

11.04 am: NIIT shares gained over 4 per cent in the morning trade on Thursday following the company’s plan to establish European Delivery Centre in Dublin, creating 110 jobs over five years. The development is supported by the Department of Jobs, Enterprise and Innovation through IDA (Industrial Development Agency) Ireland. The scrip was up 4.82 per cent at Rs 72.80.

10.40 am: Investors failed to get any sense of relief with chief economic adviser Arvind Subramanian’s statement that India does not need further fiscal stimulus to revive the economy, despite record low inflation and growth seen at the lower end of an 8.1-8.5 per cent target this financial year. The markets are likely to remain volatile ahead of the expiry of the derivative contracts for the September series due later today. Traders were seen piling up position in consumer durables, healthcare, IT, TECk and realty, while selling was witnessed in metal, capital goods, power, PSU and oil & gas. Sensex was down 56 points at 25,766. Nifty was down 7.25 points at 7,838.70

10.18 am: Elder Pharmaceuticals shares surged as much as 16.41 per cent in the early trade on Thursday after the company informed BSE that it is mulling options to sell its overseas subsidiaries. The scrip was trading 12.30 per cent up at Rs 113.25. Sensex was down 65 points at 25,763.

9.50 am: Extending weakness for the fourth straight day, the rupee fell further 24 paise to 66.22 against the US dollar in early trade on sustained month-end demand for the American currency overseas amid foreign fund outflows. The BSE IT index and BSE Healthcare index were up

9.40 am: As per provisional figures, foreign institutional investors (FIIs)/ Foreign Portfolio Investors (FPIs) sold shares worth net Rs 1,330.12 crore on September 23. Domestic institutional investors bought shares worth Rs 891.36 crore. Sensex was down 88 points at 25,734.99.

9.34 am: Balmer Lawrie & Company informed stock exchanges on Wednesday (post market hours) that it will be investing Rs 400 crore in its logistics infrastructure business in the next 24-36 months. The company will be setting up Multi-modal Logistics Hub at Vizag, a project under the MoU signed with Visakhapatnam Port Trust. The share price of Balmer Lawrie & Company was trading 0.45 per cent up at Rs 566.35. Sensex was down 58 points at 25,765. Nifty was down 11 points 7,834.95.

9.16 am: Sensex was down over 100.98 points at 25722.01. Shares of Lupin, Bajaj Auto, Dr Reddy’s Laboratories were trading in green in the opening trade. However, Larsen & Toubro and Reliance were down over 1 per cent.

Domestic equity markets opened on a flat note with negative bias on Thursday tracking Asian markets. Sensex opened 24.94 points down at 25,798.05. Nifty opened 7.55 points down at 7,838.40.

Markets are likely to remain volatile throughout the day as the September F&O series will expire on Thursday and traders will be adjusting their positions.

NIFTY FUTURE OI added open interest by 42 per cent in the entire September series with a fall in price by 1.30 per cent at 7,846 levels. Chandan Taparia, derivatives and technical analyst, Anand Rathi, said, “Put Call ratio is hovering near to 0.95 levels which indicates that bulls are supporting the market on declines as sustain put writing seen at lower strikes.”

India VIX is down by 6 per cent in this series and fell down from previous series high of 35.57 to 20.68 levels. “Volatility may remain high till RBI policy meet but recent fall in VIX is giving comfort to bulls to process for a short term bottom in the market,” said Taparia.

Rollover: Jubilant FoodWorks, JSW Steel, M&M Fin, RCom, Aurobindo Pharma, UBL, IDBI, TCS, GAIL are top in stocks rollover. Telecom, metals, fertilisers, infrastructure, textile, banking, pharma, capital goods and realty stocks are top in sector wise rollover.

Global Markets

New York: US. stocks ended down slightly on Wednesday, led by losses in materials and energy shares as weak Chinese and US factory data added to growth worries.

London: Britain’s top equity index recovered on Wednesday from a slump in the previous session, as rising oil prices led to gains by energy stocks.

Tokyo: Japan’s Nikkei share average fell on Thursday as Japanese markets reopened after a three-day national holiday to face news of weak Chinese and US factory performance.

Hong Kong: The Hang Seng Index down 0.8 per cent.

The Sensex has declined 14% since its all-time high in March 2015. (PTI)

Of the 15 companies that have tapped primary markets this year, shares of seven companies trade below their issue price while two stocks have yielded nil returns. The remaining six stocks have outperformed benchmarks yielding double-digit returns since their listing. Shares of VRL Logistics — whose IPO received an astounding response from investors — is the top performer, with a return of 94% since it listed in end-April.

The Sensex has declined 14% since its all-time high in March 2015. Data also indicate that the Street was averse to infrastructure-related companies. Four out of five infra companies that listed on the market have yielded negative returns. The 15 firms that went public have cumulatively raised close to Rs 6,500 crore, Prime Database data showed.

According to Prithvi Haldea, CMD, Prime Database, while the weak sentiment in the market does reflect in the demand for IPOs, companies continue to file their draft prospectus which signifies investors are positive about the long-term prospects of our markets.

“Filings will stop as and when investors take a bearish view of the Indian markets. Filing draft documents doesn’t essentially mean the IPO is happening immediately. I am sure the companies will wait for the secondary markets to stabilise before actually going for the public issue,” Haldea said.

Merchant bankers said that investors continue to be selective despite the boom that was witnessed in the secondary market.

Some of the issues were priced keeping in mind the positive sentiment of the market, they said. “When the markets were bullish, the issues were priced as high as 10-12 times the earnings of the respective companies. But when markets turn bearish, these investors take the exit route bringing down the stocks. Adverse situations like these will force the companies to bring some sanity to the pricing. This was already evident in the issues that happened during the last week of August,” said B Madhuprasad, chairman, Keynote Corporate Services.

Experts said the sell-off in the global markets arising out of China ‘hard landing’ fears pose a severe risk for India’s primary markets that is recuperating after four years of hiatus. The recent issues saw a sharp fall in grey market premiums. The grey market is a pseudo over-the-counter market where IPO shares are bought and sold before a company officially lists on the stock exchange. It gives a broad indication about the appetite for a public issue.

More than 60 companies scrapped their IPO plans between 2011 and early 2014 due to unfavourable market conditions, halting plans of Indian companies to raise more than Rs 65,000 crore through primary markets.

A section of the industry however said that the long-term state of the primary markets remains intact as India anticipates a bull-run in equity markets.

Satyen Shah, executive vice-president, Edelweiss Financial Services, said stock performance on the company depends on its financials, and investors take a call based on the company’s track record and its pricing. Good companies will continue to attract investors irrespective of the timing of the issue. “Notwithstanding the short-term pain, primary markets continue to be in a buoyant mood,” Shah added.

L&T Finance Holdings (LTFH) will raise Rs 700 crore from Bain Capital through a combination of preferential equity and warrant allotment; this will aggregate to 5.2% of its post-issuance capital. This capital will support medium-term growth targets of its group companies or may be used to redeem  existing preference shares.

We tweak estimates to factor in the infusion. LTFH will issue equity shares of Rs 235 crore for 1.75% post-issuance stake in the company.

Additionally, Bain Capital will subscribe to 63 million warrants aggregating to Rs 472 crore. Both issuances will be made at Rs 74/share (1.5X PBR FY2017E). Bain Capital has also purchased stake in LTFH from the secondary markets; Bain Capital will hence own 10% in the company.

We value LTFH on a SoTP basis. We value LTF and LTIF at 1.8X and 1.6X PBR FY2017E, respectively. To factor in capital issuance and preference shares at the holding company,  we factor in the same separately in our SoTP. At our target price, LTFH will trade at 1.7X FY2017E book for medium-term RoE of 15-17%.

We expect its growth trajectory (20% loan book CAGR between FY15 and FY18E) to be superior to most peers due to its focus on multiple growth segments; we expect the company to deliver 14% EPS CAGR during the period.

We tweak estimates to factor in equity issuance and warrant conversion. Since the allocation of funds across group companies is not clear, we increase cash/reduce borrowings at the holding company.