Key indices extend gains in morning deals

Indian equity benchmarks extended gains in morning deals amid broad-based buying, bolstered by strong gains in global markets. Traders took a note of report that Insolvency and Bankruptcy Board of India (IBBI) has amended regulations for corporate insolvency proceedings wherein a resolution professional will be required to provide details about his or her opinion about avoidance transactions pertaining to a corporate debtor. IBBI has amended the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations. Traders overlooked rating agency Crisil Ratings’ report that collection ratios in securitised pools have seen a dip during the second wave of the Covid-19 pandemic. It said unlike in the first wave, the decline in the second wave has not been as sharp for two reasons - localised restrictions limited the impact on business activity, and lack of moratorium from lenders meant that borrowers could not postpone their debt repayments. On the global front, Asian markets were trading in green as strong U.S. earnings helped offset concerns about the economic impact of coronavirus flareups.

The BSE Sensex is currently trading at 52769.56, up by 571.05 points or 1.09% after trading in a range of 52471.23 and 52774.47. There were 28 stocks advancing against 2 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.94%, while Small cap index was up by 1.44%.

The top gaining sectoral indices on the BSE were Metal up by 2.67%, Realty up by 2.37%, Consumer Durables up by 2.04%, Basic Materials up by 1.45% and Bankex up by 1.40%, while Power down by 0.37% was the lone losing indices on BSE.

The top gainers on the Sensex were Bajaj Finance up by 3.85%, Tata Steel up by 2.90%, Titan Company up by 2.29%, Infosys up by 1.82% and ICICI Bank up by 1.80%. On the flip side, Asian Paints down by 0.71% and HCL Technologies down by 0.08% were the top losers.

Meanwhile, rating agency Crisil Ratings in its latest report has said that collection ratios in securitised pools have seen a dip during the second wave of the Covid-19 pandemic. It said unlike in the first wave, the decline in the second wave has not been as sharp for two reasons - localised restrictions limited the impact on business activity, and lack of moratorium from lenders meant that borrowers could not postpone their debt repayments. 

According to the report, this prompted many financing entities to explore digital collection – an avenue that has played an important role in preventing a similar fall in collections during the second wave. It also said securitisation is the process of pooling and repackaging of homogenous illiquid financial assets into marketable securities that can be sold to investors. Non-banking financial companies (NBFCs) have been also reworking their collection process since the onset of the pandemic by increasingly adopting electronic modes such as auto-debit, payment gateways and dedicated applications. 

The agency further said such productivity enhancement was one of the reasons for the sharp recovery in collection ratios of securitised pools during the second half of last fiscal. It also said as more businesses set up online modes for business continuity, their cash flows become less prone to disruption. Mortgage loans remained the most resilient of all asset classes. While commercial vehicle loans saw a dip in median collection ratios of almost 11 percentage points in May 2021, it expects the collections to improve going forward in line with the recovery expected in the economic activity. 

The CNX Nifty is currently trading at 15793.15, up by 161.05 points or 1.03% after trading in a range of 15726.40 and 15799.70. There were 42 stocks advancing against 8 stocks declining on the index.

The top gainers on Nifty were Bajaj Finance up by 3.79%, JSW Steel up by 3.26%, Hindalco up by 2.98%, Tata Steel up by 2.84% and Titan Company up by 2.17%. On the flip side, Hero MotoCorp down by 0.90%, Asian Paints down by 0.79%, Adani Ports &SEZ down by 0.59%, Eicher Motors down by 0.48% and Cipla down by 0.46% were the top losers.

Asian markets were trading in green; Hang Seng increased 480.67 points or 1.77% to 27,705.25, Taiwan Weighted strengthened 63.57 points or 0.36% to 17,522.36, Jakarta Composite soared 77.81 points or 1.29% to 6,107.79, KOSPI rose 32.31 points or 1% to 3,248.22, Shanghai Composite gained 11.64 points or 0.33% to 3,574.30, Straits Times advanced 40.41 points or 1.3% to 3,159.41 and Nikkei 225 surged 159.84 points or 0.58% to 27,548.00.