REC shares gain 3% after signing MoUs worth ₹1.12 lakh crore with renewable energy developers

Shares of REC Ltd surged over 3% to hit an intraday high of ₹563.25 apiece on the NSE on Wednesday, September 18, after the company announced entering into a non-binding financial commitment of increasing its renewables loan book to more than ₹3 lakh crore by 2030.

In a filing on September 17, REC informed the exchanges that it has signed non-binding Memorandums of Understanding (MoUs) with renewable energy developers aggregating nearly ₹1.12 lakh crore, which will be implemented over five years.

The state-owned power financing company signed a ‘Shapath Patra’ to increase its renewables loan book to over ₹3 lakh crore by 2030. The signing of the MoUs will increase the share of renewables in REC’s loan book from 8% to 30% by 2030.

REC projects a loan book of ₹10 lakh crore by 2030 with a strategic plan, which includes increasing the fund allocations for the renewable energy segment.

The MoUs were signed at the 4th Global Renewable Energy Investors Meet and Expo (RE-INVEST 2024), which will be held from September 16 to September 18 in Gandhinagar, Gujarat. The company said in the release that it plans to be a key player in achieving India’s aim of increasing its installed non-fossil-based power generation capacity to 500 GW from 200 GW by 2030.

The MoUs signed by the state-owned Non-Banking Financial Company (NBFC) include the development of solar and wind hybrid projects, solar and wind round the clock (RTC) projects, firm and dispatchable renewable energy (FDRE) projects, floating solar plants, ultra mega renewable energy park, hydroelectric power projects, Battery Energy Storage Systems (BESS), Pumped Storage, Hydropower, Green Ammonia/Hydrogen, Solar Cell/Module Manufacturing and other such technologies.

The state-owned power sector company said that discussions are underway to finance green energy corridors, wind turbine manufacturing, and the electric vehicle ecosystem. The company said that it is open to considering renewable projects by developers for the consumer and industrial segments having top-rated offtakers.

REC shares were trading at ₹553.5 apiece on the NSE at 11:12 am, up 1.59%.

On Wednesday, over 86 stocks advanced to 52-week highs. The benchmark indices, NIFTY50, traded above the 25,450 mark, while the SENSEX was at 83,235, up 0.19%. NIFTY Bank was trading at 52,691, up 0.96%, while the fear gauge India VIX rose to 12.91.

The broad market indices traded in mixed, with Nifty Midcap 100 down 0.43%, while the Nifty Smallcap 100 was muted with gains of 0.03%. The sectoral indices traded mixed with Nifty’s Financial Services being the top gainer (+1.25%), while Nifty’s IT remained the top loser (-3%).

Top three stocks that hit a fresh 52-week high on Wednesday, September 18, 2024:

BSE gains ahead of rival NSE's IPO

Shares of Asia’s first stock exchange logged a fresh 52-week high at ₹3,643.35, climbing 9.29% in Wednesday's session.

The stock witnessed a surge in buying interest after its unlisted rival National Stock Exchange (NSE), received clearance from SEBI (Indian market regulator) in a long-standing case, paving its way towards an initial public offering (IPO). Since the beginning of this week, i.e. Monday, the stock has surged over 25%.

NSE’s IPO could boost shares of other market infrastructure companies, including BSE and depository service providers. Whenever companies like NSE with huge issue size come up with IPOs, a large pool of investors is eager to participate in the IPO.

A company like BSE would benefit from brokerages and commission earnings from NSE’s fundraising. Last month, the National Stock Exchange (NSE) officially sought approval for its initial public offering (IPO) by applying for a no objection certificate (NOC) with capital markets regulator SEBI.

Further, the NSE IPO would also re-rate the valuation of BSE. Currently, BSE trades with a market capitalisation of ₹49,020 crore with a price-to-earnings ratio of 84.7.

MCX m.cap crosses ₹30,000 crore

Multi Commodity Exchange of India Ltd (MCX) - The first listed online commodities trading platform soared over 4.52% on Wednesday, peaking at a 52-week high at ₹5,908.8 and reaching the market cap to the ₹30,000 crore mark.

In the past month, MCX shares have surged over 23%, driven by the positive outlook for Indian markets. This is largely due to expanding demand from improving economic activity and the growing need for commodity price risk management.

In October 2023, MCX transitioned to a new tech platform provided by TCS, replacing the previous software from 63Moons Technologies. Market experts viewed this switch positively. The transition also allowed MCX to significantly reduce major maintenance costs, further boosting investor confidence as operations remained seamless.

Starting October 1, MCX will pay fixed annual maintenance charges (AMC) to TCS, eliminating the volatility seen in previous quarters and enhancing profitability. For the June quarter of FY25, MCX reported a 25% quarter-on-quarter (QoQ) profit increase, alongside a nearly 30% QoQ rise in revenue to ₹234.4 crore. Its earnings before interest, taxes, depreciation, and amortization (EBITDA) also jumped 30% QoQ to ₹132.6 crore.

Hero MotoCorp surges ahead festive season optimism

India’s leading 2-wheeler maker’s scrip climbed to a 52-week high at ₹6,145.95, gaining over 3.1% in Wednesday’s morning session.

The stock is currently in an upward trend driven by strong trading activity and investors' interest. capture growth for the company. Till 11.17 a.m. on the NSE, the stock witnessed a trade volume of 6.25 lakh shares with a trade value of ₹380.19 crore.

The stock of the company gained on the back of a positive outlook, as the company has seen favourable trends across its domestic, electric vehicle (EV) and global businesses, in the last quarter.

Two-wheelers are a better tactical play for festive demand revival. With rural market demand improving due to favourable monsoon.

Therefore the company anticipates to increase momentum in the October to December 2024 quarter due to positive customer sentiment. Additionally, the company is expected to launch products in internal combustion engine (ICE) as well as EV categories.

Hero MotoCorp is India’s leading two-wheelers manufacturer, with a nearly 32% share of the domestic motorcycle market in volume terms.

Shares of Indian information technology (IT) companies took a hit on Wednesday, September 18, ahead of the crucial US Federal Reserve meeting later in the day that could kick-start the rate cut cycle.

As of 1:30 pm, the top five losers among the NIFTY50 stocks were all tech companies – Tata Consultancy Services Ltd (TCS), Tech Mahindra Ltd, Infosys Ltd, Wipro Ltd and HCL Technologies Ltd.

While TCS shares were down 3.99% to ₹4,326 apiece, HCL Technology was the second biggest loser with shares trading 3.79% lower at ₹1,745 apiece. Tech Mahindra shares were trading 3.48% lower at ₹1,594 apiece. Infosys fell 3.47% to ₹1,884 apiece on the NSE, while Wipro slipped 3.1% to ₹534.4 apiece.

As of 2:00 p.m., the NIFTY IT index was down over 3.5%, with all 10 of its components trading in the red. Mphasis Ltd, which is not part of the NIFTY 50 index, declined the most, over 5%, to trade at ₹3,015 level.

The US Federal Open Market Committee (FOMC), the Fed’s chief body for monetary policy, is expected to cut rates for the first time in four years at its meeting today. Though a rate-cut is usually considered a positive for stocks as it holds the potential to boost spending in the economy, the scenario is a little different this time.

Reports suggest that a majority of Wall Street traders—two-thirds — are expecting a rare 50 basis point cut in policy rates at today’s meeting. If this turns out to be true, it would officially stamp out the growing fears of a recession in the US economy.

As most IT stocks are trading near their all-time highs, their stretched valuations are a major concern among investors. Any correction triggered in the broader market due to global macroeconomic concerns could, therefore, hit the sector the most.

Also, a 50-bps rate cut is a negative for the US dollar. If the Fed hints at steep cuts going forward in its commentary, the Indian rupee may strengthen against the dollar. This may weigh down stocks of exporters like IT companies further.

The US central bank has held rates steady since July 2023 after raising them by a record 11 times between March 2022 and July 2023. Experts have already factored in a 25-bps cut by the Fed this time along with a dovish stance, but anything beyond that could raise eyebrows.

The NIFTY 50 index was trading marginally lower at 25,350, down 0.27%, on the NSE at 2:00 pm, amid a mixed trend in the Asian markets.

Overnight, the Wall Street benchmark indices closed little changed ahead of the US Fed interest rate decision. Dow Jones hit a record high during the session, but ended with minor losses. The S&P also hit a new high, but ended flat.

Share price of Inox Wind jump 2.2% on the NSE ₹248 apiece after company received LoA from IGREL execution of 550 MW power plant on turnkey basis in Gujarat, Rajasthan and Madhya Pradesh.

Inox Wind (IWL) has received a Letter of Intent (LoI) from IGREL Renewables (IGREL) for execution of 550 MW wind capacity on turnkey basis. As part of the project, Inox Wind will supply, install and commission the Wind Turbine Generators (WTGs), and provide multi-year comprehensive operations & maintenance (O&M) services post commissioning.

The project will be executed over the next 24 months across multiple sites in the states of Gujarat, Rajasthan and Madhya Pradesh. The 550 MW LoI is over and above the firm order of 200 MW received in the past, and takes the company's order book to greater than 3.5 GW.

The total revenue stood at ₹607 crore for the June 2024 quarter. The mentioned figure indicates an increase of about 110.41% as against ₹288 crore during the year-ago period. The Total Profit for the quarter ended June 2024 of ₹70 crore grew from ₹ 67 crore. Operating profit saw a handsome growth to ₹119 crore from ₹1.5 crore in the quarter ended June 2024.

Inox Wind is India’s leading wind energy solutions provider servicing IPPs, Utilities, PSUs & Corporate Investors. The shares of the company delivered stellar returns of 89% in 2024 on YTD basis.