Finvezto Daily Market Bytes, 20 Dec 2024
Hyundai <> Exide; Zerodha MTF = ZeroSense?; JSW Ports Expansion Plan
In today’s edition, we cover:
Hyundai <> Exide
Zerodha MTF = ZeroSense?
JSW Ports Expansion Plan
Key Stock Updates
Here’s a quick market snapshot before we start. GIFT Nifty indicates a flat to lower opening for the Indian Markets.
Hyundai <> Exide
Hyundai and Kia partner with Exide to manufacture battery cells locally for India-specific electric vehicles.
Exide Energy Solutions will produce lithium-iron-phosphate cells specifically for Hyundai and Kia's upcoming Indian EV lineup.
These are not your regular batteries. They can handle over 10,000 charging cycles, nearly 5 times more than standard lithium-ion ones.
For Hyundai, India's push toward carbon neutrality makes local battery production essential. Not just that. It brings along cost advantages & supply chain control as well.
Zerodha MTF = ZeroSense?
Zerodha introduces Margin Trading Facility (MTF) with 5x leverage on 800+ stocks.
Here are the MTF related details - 80% funding provided on trades, 0.04% daily interest, and funding up to ₹50 lakhs.
Don't underestimate that seemingly modest daily interest rate of 0.04% - it compounds into a hefty 15% annual rate.
Traders can certainly amplify their market positions by 5X, but at what cost?
MTF is not a new concept in the broking industry. It has been there for a while. Other brokers charge somewhere between 9-12% as Annual Interest. But Zerodha seems to be charging a relatively high 15% annual interest.
Even if you are super bullish on a stock and want to play out a quick trend, it makes ZeroSense to borrow money at 15%.
Maybe Zerodha kept the rates so high to discourage traders from using MTF.
As per me, it does not make sense to do MTF at all even if the borrowed money comes at 9%.
Individual stocks can be very volatile. Interest costs can pile up quickly. Falling stocks might force traders to add margin/exit positions.
If you play the MTF game, you start as a weak hand. Likelihood of losing is higher.
Your entire capital can be wiped off in a week or worse even in a day if the stock falls by 20%.
Stay away from MTF. It makes ZeroSense.
JSW Ports Expansion Plan
JSW Infrastructure charts ₹30,000 crore expansion plan to double cargo capacity, targeting 400 million tonnes yearly by 2030.
The company's transformation is already underway. From being only JSW Group's port operator, they have diversified. Third-party cargo jumped from 5% to 48% in just six years.
The goal? A balanced 50-50 split between Group business and external business.
However, it still remains a distant second in the ports space with Adani being the Market leader. But this expansion might fuel significant competition in the Ports arena.
Key Stock Updates
New Orders
GE Vernova secured ₹400 crore order from Sterlite Grid for high-voltage equipment supply and supervision.
Mazagon Dock starts production of 14 fast patrol vessels for Indian Coast Guard, valued ₹1,070 crore.
Deep Industries won integrated drilling services contract from Selan Exploration Technology.
Mazda received $98 crore international order for Multi Effect Evaporator ZLD Plant.
Partnerships/Investments/Acquisitions
Hyundai Motors India signs binding agreement with Exide Energy for EV battery cell production.
EPL approves new subsidiary in Thailand to manufacture and trade laminated tubes.
Core Business Updates
Bharti Airtel clears ₹3,626 crore spectrum liability to Department of Telecom from 2016 acquisition.
Cosmo First launches automotive paint protection films, beginning market trials immediately.
Ice Make Refrigeration introduces new commercial freezers including chest and VISI coolers.
That’s all for today!
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Disclaimer: Anand Ganapathy K is a SEBI-registered Research Analyst with SEBI registration number INH000016630. This daily update highlights market trends for your awareness. It does not recommend buying or selling stocks mentioned in this newsletter. Securities market investments carry market risks. Kindly review all related documents before investing.