Shares set to rise amid Adani Group’s share sale, ahead of Budget 2023

Indian shares will open higher on Tuesday, the final day of Adani Enterprises’ mega secondary share sale and a day ahead of the Union Budget, with investors also keeping an eye on interest rate decisions by global central banks later this week.

India’s NSE stock futures listed on the Singapore bourse rose from 08:11 am. IST was up 0.47% at 17,789. Asian markets were down 0.51%.

India snapped a losing streak on Monday as key Adani Group shares arrested their two-session slide since U.S. short-seller Hindenburg Research raised concerns last week about the group’s debt levels and use of tax havens, charges the conglomerate has . deny. The report also weighed on banks, on concerns about their loan exposure to the group.

Still, the group’s seven listed companies have lost $65 billion in market value since the report, while flagship Adani Enterprises’ stock is well below the offer price of its pivotal $2.5 billion follow-on share offering, subscribing just 3% in the first two days.

Investors will also shift focus to India’s Union Budget on February 1, with the government’s fiscal consolidation path and borrowing calendar for fiscal 2024 seen as key triggers.

Traders will also be watching the budget for any incentives to attract foreign investors, who have been piling out of the market, especially since the report on Adani Group.

Foreign institutional investors sold 151.65 billion rupees ($1.86 billion) worth of shares on a net basis in the past three sessions.

The Federal Reserve’s rate decision is due on Wednesday, focusing on future monetary policy, which is key for Indian firms, especially IT companies, which have large exposure to the United States.

In addition to the Fed, rate decisions from the European Central Bank and the Bank of England are also due this week.

Helping domestic stocks could be oil prices, which fell more than 2% ahead of the OPEC+ group meeting and on indications of strong Russian supply. A drop in prices is positive for oil importers like India.

STOCK TO VIEW

** Larsen & Toubro: The company reported a lower-than-expected rise in third-quarter consolidated net profit on moderate order growth.

** Tech Mahindra: The company reported a decline in quarterly consolidated net profit due to higher costs and a moderation in demand.

** KEC International: The company bagged new orders worth 11.31 billion rupees.

** Bharat Petroleum: The company posted a drop in quarterly net profit on stagnant retail prices. ($1 = 81.5930 Indian Rupee)