Index trend and stocks in action August 12, 2016

The Indian benchmark indices got off to a flat start, in tandem with cautious sentiments prevailing in the Asian markets. Nifty remained in negative terrain for the first couple of hours. However, soon the Nifty gathered momentum and touched intraday highs in noon trade, but could not succeed in holding its gains for long as selling pressure emerged at higher levels. In the end market ended with modest gains. On the daily chart Nifty has formed a potential ‘Hammer’ candlestick pattern, which is a bullish reversal candlestick pattern that is formed after a decline. Now going forward Nifty has strong support in the region 8510-8520. If breached, the next support level is marked at 8470, and this is a crucial one. On the upside, immediate resistance is placed near 8640 levels and major resistance is in the zone of 8690-8710.  

Grasim & Aditya Birla Nuvo: The A V Birla Group, with a market capitalisation of $41 billion, is undergoing a major restructuring to help align businesses better and enable the group to get a better valuation on the bourses. As per the scheme of arrangement, Grasim and Aditya Birla Nuvo will merge in the ratio of 100:30 i.e. shareholders of Aditya Birla Nuvo will get 30 shares of Grasim for every 100 shares of A B Nuvo. Post the merger, the financial services business of Grasim and A B Nuvo will come under a single banner. In the first step, A B Nuvo will be merged into Grasim as a result of which the financial business of A B Nuvo will come under Aditya Birla Financial Services Ltd. (ABFSL). ABFSL will list on the exchange after the merger. As a result of the swap ratio, shareholders of A B Nuvo will get 210 shares in ABFSL for every 100 shares held; while shareholders of Grasim will get 700 shares of ABFSL for every 100 shares held. This merger will not only simplify the group ownership, according to Kumaramangalam Birla, but also help in unlocking value for the group.

S P Apparels: Garment maker S P Apparels, which concluded its initial public offering (IPO) earlier this month, will make its debut on stock exchanges today.

Indiabulls Housing Finance: IBHFL will open Rs 15,000 crore worth non-convertible debentures (NCDs) issue next week.

IPCA Lab: IPCA Laboratories has seen a two-fold rise in net profits for the quarter owing to strong operational performance.  Net sales were up by about 9.6% for the same period. The big surprise came on the operational front. The operating profits have grown by 60% to Rs.128 crore; while the operating profit margins (OPMs) have expanded by 426 bps to 15.26%.  

Escorts: Farm equipment maker Escorts has announced the sale of its auto products business to Pune-based Badve Engineering in an all-cash deal. This was not part of the core focus of the company and Escorts will now focus on agri-machinery, construction equipment and railway verticals.

Bharti Airtel: The telecom operator has completed acquisition of the right to use 20MHz spectrum in 2300 Mhz band in Odisha circle, resulting from a deal with Aircel Ltd.

SBI: State bank of India will report its earnings today.