Sensex Ends Marginally Higher; FMCG And IT Stocks Witness Buying

Indian share markets witnessed volatile trading activity throughout the day today and ended marginally higher.

At the closing bell, the BSE Sensex stood higher by 60 points. Meanwhile, the NSE Nifty ended up by 39 points.

SGX Nifty was trading at 11,375, up by 14 points, at the time of writing.

The BSE Mid Cap index ended down by 0.8%. The BSE Small Cap index ended down by 0.2%.

Sectoral indices ended on a mixed note with stocks in the IT sector and FMCG sector witnessing buying interest.

Realty stocks, on the other hand, witnessed selling.

Bharti Infratel was among the top gainers in NSE today.

Asian stock markets ended on a negative note. As of the most recent closing prices, the Hang Seng was down 0.4% and the Shanghai Composite stood lower by 1.9%. The Nikkei ended down by 0.5%.

The rupee is trading at 73.46 against the US$.

Gold prices were trading up by 0.3% at Rs 50,815 per 10 grams at the time of writing.

Speaking of the precious yellow metal, how lucrative has gold been as a long-term investment in India?

The chart below shows the annual returns on gold over the last 15 years...

As you can see, barring just two years - 2013 and 2015, gold has delivered positive returns in 13 of the last 15 years.

Even with the recent volatility in prices, gold and silver remain among the best-performing commodities this year to combat the fallout from the coronavirus pandemic.

In news from the telecom space...

Vodafone Idea was among the top buzzing stocks today.

Vodafone Idea has launched a new brand identity in India. This comes as the company attempts to mount another challenge in the space which has seen Reliance Jio and Bharti Airtel strengthen over the past few quarters.

Vodafone Idea, now VI, is renewing its focus after the AGR verdict a few days ago. Vodafone Idea also says that it has completed the network integration-which it says is the world's largest mobile network integration in record time.

The rebranding may also bring with it price hikes of VI prepaid and VI postpaid users, something that the company has hinted at already. This is as the company looks to increase the average revenue per user (ARPU) figures.

At present, VI's ARPU is around Rs 114, which is significantly lower compared to Reliance Jio which has around Rs 140 ARPU from its user base while Airtel clocks in with around Rs 157.

VI also says they will continue to partner with the government of India to push forward the digital economy mission.

The company has seen its user base reduce significantly, dropping to 280 million users at the end of June this year, compared with 408 million users at the time of the merger between Vodafone and Idea two years ago. Since then, the Vodafone and Idea brandings have remained separate, though a few months ago, Vodafone Idea did unify the postpaid plans for Vodafone and Idea users under the Vodafone RED umbrella.

How the above development pan out remains to be seen. Meanwhile, we will keep you updated on all the news from this space.

Moving on to news from the IPO space, the initial share-sale of IT services firm Happiest Minds Technologies sailed through in just over two hours into the bidding process today.

The issue received bids for 2,37,01,590 shares, which was 1.01 times the issue size of 2,32,59,550 shares.

The retail quota was subscribed over 5 times. NII quota was subscribed 20% while the quota for QIBs was subscribed to 8%.

The digital company, whose issue is being sold in Rs 165-166 price band, raised 3.1 billion on Friday from 25 anchor investors including the Government of Singapore, Goldman Sachs, Kuwait Investment Authority, Nomura Funds Ireland, Jupiter India, and Pacific Horizon Investment.

Strong and experienced promoters, along with a niche business model and exponential growth prospects are the prime reasons cited for the hefty premium in the grey market, said dealers in the unofficial market for unlisted shares.

Ashok Soota, promoter of Happiest Minds, was the founder of midcap IT firm Mindspace, which was later taken over by the Larsen & Toubro group. The industry veteran previously had a long stint in Wipro from 1984 to 1999.