Opines Bartleet Religare Securities
Market attractiveness and certain positive news from the macro-economic front with the receipt of the next tranche of IMF loan, kept the sentiments alive towards the end of the month , stated Bartleet Religare Securities in its latest Monthly Report .
“Index heavy blue chip stocks gained investor attention during the month. This led the market to incur only minor losses (-0.7% MoM, down 37.89 points) during March compared to heavy losses seen in January (-6.3% MoM) and February (-4.1% MoM). The market has been incurring losses since last August and has lost 10.8% during Jan – March this year. Such sharp losses have now paved the way for the CSE to trade at low multiples, appealing to value and growth investors, in our view. Market attractiveness and certain positive news from the macro front (expectation of the receipt of the next tranche of IMF loan) kept the sentiments alive towards the end of the month.”
“The market traded on thin volumes during the month recording an average daily volume of 30 million, compared to 54 million and 46 million in February and January. Despite lean volumes, the average daily market turnover was recorded at Rs 1.6 billion. However, the figure is inflated by the Rs 16 billion turnover the market witnessed on March 16, on account of JKH deal between the EPF and a Malaysian sovereign wealth fund. Excluding that, the average monthly turnover would have been Rs 873 million for the month. The month saw a net foreign inflow of Rs 18 billion, mainly aided by EPF selling JKH and SPEN stakes to foreign investors.”
“In early March, the SEC ceased listing via ‘introduction’ in an attempt to curb manipulation. Most of the companies that took a listing through an ‘introduction’ offered little or no free float, making the shares very illiquid and favorite picks among price manipulators. Access Engineering was oversubscribed 1.5 times at its Initial Public Offering. The company offered 20 million shares at Rs 25 per share to raise Rs 500 million. Mackwood Energy IPO was also oversubscribed on its opening day, drawing applications worth of RS 400 million. The IPO offered 25 million shares at Rs 14per share to raise Rs 350 million.”