In today’s briefing:
- Indian Renewable Energy (IREDA IN) QIP: Index Implications
- EQD / NSE NIFTY50 Vol Update / India Budget Event Dominates Local Options Markets.
Indian Renewable Energy (IREDA IN) QIP: Index Implications
- IREDA has announced a Qualified Institutional Placement (QIP) of a maximum of INR 50bn as long as the Government of India’s holding does not drop by more than 7%.
- There will be passive buying at the time of settlement of the QIP shares while the increase in float will bring the stock closer to inclusion in another global index.
- With the stock close to index inclusion level and down 37% from its peak, there could be positioning in the stock for passive inflows.
EQD / NSE NIFTY50 Vol Update / India Budget Event Dominates Local Options Markets.
- Monthly Options contracts experiencing large IV markups on account of India Budget event. IVs have traded up to 18.0%. YTD vol increase marks a significant shift in the Vol-regime.
- Gamma offered & Vega bid – Weekly Options contracts relatively out-of-favour while Monthly & Quarterly contracts are being marked up.
- Skew & Smile characteristics have compressed slightly. Vol term-structure continues to trade with “inverted-V” shape.
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