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The Baseline
07 Feb 2024
Chart of the Week: 11 out of 40 wealth destroyers in the past six months are from the chemicals sector
By Akshat Singh

The Nifty 500 has gained 18.1% in the past six months, but the wave did not lift all boats. Some companies’ share prices fell due to their specific challenges, like regulatory probes, rule changes, major business losses, misconduct, or broad sectoral downturns. In this edition of Chart of the Week, we look at a screener of stocks that have been the biggest wealth destroyers in the past six months and one year, and analyze the reasons for the same. 

This screener consists of 40 companies from the Nifty 500 index with negative price changes in both the past six months and year. The chemicals & petrochemicals sector features prominently with 11 stocks, followed by the banking & finance, retailing, and textiles, apparels & accessories sectors with five stocks each. The chart represents the top 10 wealth-destroying stocks over the past six months. 

Chemicals sector faces margin pressure amid Chinese competition 

Starting with the chemicals & petrochemicals sector, we find two wealth-destroying stocks in the top 10 list: Navin Fluorine and UPL. The dip can be attributed to the economic slowdown in the West and easing COVID restrictions in China, which increased competition and put pressure on margins over the past year. According to HDFC Securities, the sector’s overall revenue could fall by 5.7% YoY in Q3FY24 due to destocking and weak demand. 

Navin Fluorine declined by 32.4% and 26% in the past six months and year, respectively. In October 2023, the firm saw an 18% decline following the resignation of its CEO, Radhesh R. Welling. This dampened investor sentiment due to Welling's record of doubling the company's net profit and revenue from FY19 to FY23. 

UPL also fell by 20.3% and 32.7% during these periods respectively, driven by its Q3FY24 earnings reporting a net loss of Rs 1,217 crore against a profit of Rs 1,087 crore in Q3FY23. It also faced weak demand and inventory pile-up.

Global demand and supply chain disruptions affect textile stocks

Moving on to the textile, apparels, and accessories sector, we have two stocks in the top wealth destroyers: Rajesh Exports, and Lux Industries. The sector has been hit by declining consumer demand in Europe and the US due to economic slowdown and rising inflation. Geopolitical tensions and trade disputes have added to an uncertain atmosphere, and hurt investor confidence.

Rajesh Exports saw its stock plummet by 31.2% and 61.5% in the past six months and year, respectively. This fall was due to issues like incomplete disclosures and a sharp drop in profit and revenue, with analysts suggesting possible misconduct in its financial reporting.

Lux Industries fell by 24.9% in six months and 18.7% over a year. Contributing factors include IT raids at the firm’s Kolkata premises over allegations of tax evasion amounting to Rs 200 crore. Additionally, rising cotton prices have squeezed the company’s margins.

Brightcom and Paytm decline on regulatory lapses

In the software & services sector, the once startup-star One97 Communications (Paytm), and Brightcom Group rank among the top wealth destroyers. Macro-level factors like rising borrowing rates have added pressure in the past year. 

Paytm’s stock prices dropped by 38.5% and 12.3% in the past six months and year, respectively. Following regulatory scrutiny and an RBI order to shut down its Paytm Payments Bank services, the stock plunged by 40.5% in just five days (Feb 1 to Feb 6). 

Brightcom Group fell by 23.4% and 32.1% in the past six months and year, respectively. It fell due to regulatory concerns over lapses in preferential share issues, resulting in SEBI banning some top executives from directorial posts. This follows previous investigations for overstating profits and fines imposed by SEBI. Additionally, an enforcement directorate probe uncovered significant cash and assets during searches at a key personnel's premises. 

Commercial services, retailing and media decline due to slowdown and rising competition

The commercial services sector also had two stocks among the top wealth destroyers: Delta Corp and Polyplex Corp. Delta Corp’s stock tanked by 27.1% and 28.7% over the past six months and year, respectively. The fall was mainly due to the Centre imposing a 28% GST on gambling and online gaming, which led to a GST demand of Rs 23,200 crore on the firm. 

Polyplex Corp fell by 21.9% and 33.4% over the same periods. This came after the company’s promoters pledged 100% of their shares and agreed to sell a 24.2% stake to Dubai-based AGP Holdings (AGPH) for Rs 1,380 crore. 

The retailing sector had only one stock among the top wealth destroyers: Vedant Fashions. The sector has been falling due to high inflation and economic slowdown. Vedant Fashions’s stock dropped by 22.7% and 18.1% over the past six months and one year, respectively. 

Finally, the media sector was represented by, no surprise, Zee Entertainment Enterprises in the list of top wealth destroyers. The firm’s stock fell by 22.1% and 18.4% during these periods, driven by the termination of its $10 billion merger with Sony Entertainment, which incurred a $90 million termination fee. The termination was due to declining profitability, management uncertainties amid SEBI probes, reputation of mismanagement, Russian subsidiary issues, and competition from the upcoming Disney-Reliance merger

 
Trendlyne Marketwatch
Trendlyne Marketwatch
06 Feb 2024
Market closes higher, Welspun Corp's net profit rises by 12.6x YoY to Rs 291.9 crore in Q3
By Trendlyne Analysis

Nifty 50 closed at 21,929.40 (157.7, 0.7%), BSE Sensex closed at 72,186.09 (454.7, 0.6%) while the broader Nifty 500 closed at 20,033.75 (180.3, 0.9%), of the 2,024 stocks traded today, 1,272 were on the uptick, and 726 were down.

Indian indices maintained their gains from the afternoon session and closed in the green. The Indian volatility index, Nifty VIX, rose 1.1% and closed at 15.8 points. Triveni Turbine closed sharply higher as its revenue rose by 32.5% YoY to Rs 431.7 crore due to a 26% YoY increase in its order book to Rs 531 crore in Q3. Its net profit improved by 29.8% YoY to Rs 68 crore.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, taking cues from the benchmark index. Nifty IT and Nifty Infra closed higher than their Monday close. According to Trendlyne’s sector dashboard, Telecommunications Equipment emerged as the top-performing sector of the day, with a rise of 3.3%.

Major Asian indices closed higher, except for Japan’s Nikkei 225 index closing lower. Most European indices traded in the green following the Asian indices. US index futures traded flat, indicating a cautious start to the trading session. Brent crude oil futures traded flat after closing in the green on a volatile day of trade on Monday.

  • Steel Authority of India (SAIL) sees a long buildup in its February 29 future series as its open interest rises 18.1% with a put-call ratio of 0.6.

  • Welspun Corp's Q3FY24 net profit rises 12.6x YoY to Rs 291.9 crore. Its revenue grows by 97.7% YoY, helped by rising income from steel and plastic products segments. It appears in a screener of stocks with growing net profit and margins.

  • Capital Small Finance Bank is set to open for IPO subscription tomorrow. The price band for the issue is Rs 445-468 per share. The issue size is Rs 523.1 crore, with a fresh issue of Rs 450 crore and an offer for sale of Rs 73.1 crore. Jana Small Finance Bank and Rashi Peripherals are also set to launch their IPOs tomorrow.

  • Chambal Fertilisers & Chemicals' Q3FY24 profit rises 41.8% YoY to Rs 459.4 crore despite a 46.6% YoY fall in revenue. Profit rises on the back of decreased inventory and raw material expenses. The company appears in a screener for stocks with improving book value per share for the past two years.

  • Software and services stocks like Tata Consultancy Services,Infosys, HCL Technologies and Wipro surge more than 2% in trade. The broader Nifty IT index is also trading over 2.5% up, helping it touch a new 52-week high of 38,286.

  • Apeejay Surrendra Park Hotels' Rs 970.6 crore IPO gets bids for 4.4X the available 3.5 crore shares on offer on the second day of bidding. The retail investor quota gets bids for 10.7X the available 61.9 lakh shares on offer.

  • Triveni Turbine surges as its revenue rises by 32.5% YoY to Rs 431.7 crore due to a 26% YoY increase in its order book to Rs 531 crore in Q3. Its net profit improves by 29.8% YoY to Rs 68 crore.

  • PNC Infratech rises as its Q3FY24 net profit grows by 32.4% YoY to Rs 185 crore due to lower employee benefit expenses. Its revenue increases by 13.5% YoY on better income from the water and toll/annuity segments. It appears in a screener of stocks nearing their 52-week high with significant volumes.

  • Petronet LNG is reportedly anticipated to sign a long-term contract with Qatar for the supply of 7.5 million tonnes of LNG to India annually for at least 10 years. Petronet currently has a long-term gas contract with Qatar, that is set to expire in 2028. The move aims to increase the share of natural gas contribution to India's energy mix from 6% to 15% by 2030.

  • PB Fintech falls sharply as the Income Tax (IT) Department reportedly conducts an IT survey at its subsidiary, Paisabazaar Marketing and Consulting, due to regulatory lapses and KYC norm violations.

  • Suven Pharmaceuticals plunges as its Q3 revenue declines 37.9% YoY to Rs 219.8 crore due to weak demand in the specialty chemicals segment amid global supply chain destocking. Its net profit falls by 56.6% YoY to Rs 46.5 crore.

  • SP Apparels rises sharply as it signs an agreement worth Rs 223 crore to acquire Young Brand Apparel, a subsidiary of Bannari Amman Spinning Mills.

  • Anuj Jain, MD & CEO of Kansai Nerolac Paints, forecasts an 8-10% volume growth in FY25 with sustainable margins of around 14%. He highlights double-digit volume growth in Q3FY24, driven by the festive season. Jain also notes the company's market dominance with over 50% share in the auto segment and approximately 9-10% in the decorative segment.

  • HDFC Bank receives RBI approval to acquire up to 9.5% stake each in Axis Bank, Suryoday Small Finance Bank, ICICI Bank, Bandhan Bank, Yes Bank and IndusInd Bank.

  • L&T rises as it wins a Rs 2,500-5,000 crore order from the public works roads department of Assam to construct a 12.2 km cable bridge across the Brahmaputra river.

  • Jio Financial Servicesfalls sharply as it denies rumours about negotiating to acquire One97 Communications' Paytm wallet. Reports suggest that HDFC Bank is a leading contender for the potential acquisition.

  • Deepak Khetrapal, MD and CEO of Orient Cement, says the company’s volumes will likely reach 6.2 million tonnes in FY24, compared to its guidance of 6.3-6.5 million tonnes. He also highlights that its margins will improve as prices stabilise.

  • Indian Energy Exchangerises as its total volume increases by 26.1% YoY to 10,893 million units in January 2024. According to government data, the country's energy consumption has surged by 6% YoY to 133.8 billion units.

  • BLS E-Services’shares debut on the bourses at a 125.9% premium to the issue price of Rs 135. The Rs 310.9 crore IPO has received bids for 162.5 times the total shares on offer.

  • GE T&D rises to an all-time high of Rs 736.1 as its Q3FY24 net profit grows 10.4x YoY to Rs 49.4 crore. Its revenue increases by 8.4% YoY, helped by higher income from the products, projects and systems segments. Its EBITDA margin also improves by 560 bps YoY due to lower inventory expenses.

  • HDFC Life Insurance Co is rising as reports suggest that 22 lakh shares (0.1% equity), amounting to approximately Rs 127.8 crore, change hands in a large trade.

  • Tata Chemicals' net profit declines by 60.3% YoY to Rs 158 crore in Q3FY24. Revenue falls by 10% YoY due to lower sales, rising inflation and plant shutdown in the US. Its EBITDA margin contracts by 700 bps YoY on the back of higher freight & forwarding and finance costs. The company features in a screener of stocks with declining net cash flow.

  • Zydus Lifesciences rises after announcing that its board will meet on Friday to consider a proposal to buy back fully paid-up equity shares of the company.

  • Bharti Airtel rises as its Q3FY24 profit grows by 53.8% YoY to Rs 2,442.2 crore due to lower forex expenses. Its revenue improves by 6.3% YoY, helped by increasing income from India, Africa, Airtel business, and home services. It appears in a screener of stocks with strong momentum.

  • Ashok Leyland'snet profit surges by 75.6% YoY to Rs 560.2 crore in Q3FY24. Revenue grows by 6.7% YoY on the back of improvement in the commercial vehicle and financial services segments. Its EBITDA margin also expands by 475 bps, owing to reduced cost of raw materials. The company appears in a screenerof stocks with growth in net profit and profit margin (YoY).

Riding High:

Largecap and midcap gainers today include YES Bank Ltd. (25.40, 11.40%), Indian Overseas Bank (67.55, 7.82%) and Steel Authority of India (SAIL) Ltd. (145.50, 7.54%).

Downers:

Largecap and midcap losers today include PB Fintech Ltd. (909.20, -5.75%), Bank of India (133.70, -3.54%) and Indian Bank (542.45, -3.17%).

Movers and Shakers

32 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included Triveni Turbine Ltd. (424.80, 20.00%), Jindal Worldwide Ltd. (346.05, 18.59%) and YES Bank Ltd. (25.40, 11.40%).

Top high volume losers on BSE were Prince Pipes & Fittings Ltd. (673.55, -6.96%), Suven Pharmaceuticals Ltd. (618.45, -5.31%) and Blue Dart Express Ltd. (6132.30, -3.26%).

Akzo Nobel India Ltd. (2,931.95, 7.35%) was trading at 13.4 times of weekly average. One97 Communications Ltd. (451.15, 2.88%) and Ipca Laboratories Ltd. (1,199.15, 5.71%) were trading with volumes 13.4 and 10.5 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

78 stocks overperformed with 52-week highs, while 5 stocks hit their 52-week lows.

Stocks touching their year highs included - Abbott India Ltd. (28,345.00, 0.98%), Akzo Nobel India Ltd. (2,931.95, 7.35%) and Apollo Tyres Ltd. (553.00, 1.37%).

Stocks making new 52 weeks lows included - UPL Ltd. (481.85, 1.66%) and Vinati Organics Ltd. (1,679.60, -0.62%).

12 stocks climbed above their 200 day SMA including Triveni Turbine Ltd. (424.80, 20.00%) and Jindal Worldwide Ltd. (346.05, 18.59%). 9 stocks slipped below their 200 SMA including Prince Pipes & Fittings Ltd. (673.55, -6.96%) and Crompton Greaves Consumer Electricals Ltd. (288.45, -4.52%).

 
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The Baseline
05 Feb 2024
5 auto and construction stock picks from analysts this week
By Satyam Kumar

This week, we look at the stock picks from analysts from automobiles & auto components, and cement & construction sectors.

1. Mahindra & Mahindra:

Motilal Oswal reiterates its ‘Buy’ call on this car and utility vehicle manufacturer with a target price of Rs 2,005, indicating an upside of 17.7%. Analysts Amber Shukla and Aniket Desai believe that headwinds like a weaker monsoon made for a challenging FY24 for the tractor industry, but they expect FY25 to be better, led by favourable festive timings.

The analysts are also positive about the company’s two new arms, set up to expand its electric SUV and LCV fleets. The company has earmarked an investment of Rs 10,000 crore for these electric vehicle subsidiaries. 

Shukla and Desai remain optimistic on the back of Mahindra & Mahindra’s focus on launching new models and achieving healthy margin growth in its core business. Despite predicting growth moderation in some of its verticals, they say “the company is still better placed to outperform across all its verticals”. The analysts estimate a revenue and profit CAGR of 12.5% and 17%, respectively, over FY24-26.

2. Maruti Suzuki India:

HDFC Securities maintains its ‘Buy’ rating on this car manufacturer with a target price of Rs 12,887, indicating an upside of 23.6%. Analysts Aniket Mhatre and Maitreyee Vaishampayan say, “On the back of its aggressive launch spree over the last few quarters, Maruti Suzuki continues to be the market leader in the utility vehicles segment.” In Q3FY24, the company’s net profit jumped 34.1% YoY to Rs 3,206.8 crore (beating the brokerage’s estimate by 11%), while its revenue increased by 15.3% YoY to Rs 34,509.2 crore.

The analysts note a margin improvement in Q3 by 210 bps to 12.3% (against their estimate of 11.5%), led by lower commodity costs, reduced royalties and positive forex impact. They attribute the decrease in the current order backlog to 215k units (from 250k units in Q2FY24), to the improved availability of semiconductors. 

Mhatre and Vaishampayan are optimistic about the company as the management aims to launch 10 new models by 2030, including six EV models. With rising exports and higher plant utilisation, they expect the EBITDA margin to expand by 240 bps over FY24-26.

3. Exide Industries:

ICICI Direct maintains its ‘Buy’ rating on this auto parts and equipment manufacturer with a target price of Rs 380, indicating an upside of 9.3%. In Q3FY24, its net profit grew by 7.7% YoY to Rs 240.3 crore, while its revenue increased by 12.7% YoY to Rs 3,863.3 crore. Analyst Shashank Kanodia says, “The automotive division witnessed a broad-based uptick, showing signs of demand recovery, while the industrial segment benefitted from large investments in sectors such as renewables, telecom, and infrastructure.”

Kanodia is optimistic as Exide has an early-mover advantage in the new-age lithium-ion battery business, highlighted by its joint venture (JV) with Leclanché SA (an energy storage solutions provider). This JV aims to set up electric vehicle battery assembly operations with a capex outlay of Rs 6,000 crore for a 12 GWH capacity, expected to be operational in CY25. However, the company faces competition from other established and new players in this space, such as Amara Raja Energy.

Kanodia believes that the firm is an industry leader in the lead-acid battery space. He expects steady growth in this segment in the near-to-medium term, driven by healthy auto OEM sales, increasing industrial use, and export opportunities. The analyst projects margin expansion of 12.5%, up from the current 11.5%, if raw material prices remain stable.

4. Larsen & Toubro:

BOB Capital Markets maintains its ‘Buy’ rating on this construction and engineering company with a target price of Rs 4,200, indicating an upside of 25.7%. In Q3FY24, its net profit grew by 15.5% YoY to Rs 2,947.4 crore, while its revenue increased by 18.7% YoY to Rs 55,965.6 crore. Analysts Vinod Chari, Swati Jhunjhunwala, and Arshia Khosla say, “The company posted a strong order inflow of Rs 76,000 crore in Q3, driven by infrastructure and hydrocarbon projects.”

Larsen & Toubro has increased its FY24 order inflow and revenue growth guidance to 20% and the high teens (17-19%), respectively, as it ended 9MFY24 with a record order book of Rs 4.7 lakh crore.

Despite a 50 bps YoY dip in EBITDA margin to 10.4% in Q3, which dragged the YTD margins to 7.5%, the management expects to complete all legacy orders this year and has guided for an FY24 EBITDA margin band of 8.3-8.5%. It also predicts sequential margin improvements over the next four quarters.

5. Shree Cements:

Axis Direct upgrades its rating on this cement products manufacturer to ‘Buy’ with a target price of Rs 31,470. This indicates an upside of 16.8%. In Q3FY24, the company’s net profit grew by 148.8% YoY to Rs 701.9 crore, while revenue increased by 20.1% YoY to Rs 5,370.6 crore. Analysts Uttam K Srimal and Shikha Doshi say, “Shree Cements posted robust results, exceeding our expectations, due to better demand in its operating regions and higher realizations from higher merchant power sales.” 

The company’s EBITDA margins have improved to 25%, and the analysts expect it to improve further on the back of a better product mix, higher sales of premium products, brand-building exercises, and cost optimisation. They believe the company's capacity expansion move will allow it to compete with its larger peers and strengthen its market presence. They expect volume growth of 10% CAGR over FY24-FY26, and remain bullish on the cement demand, thanks to infrastructure and housing investments.

Note: These recommendations are from various analysts and are not recommendations by Trendlyne.

(You can find all analyst picks here)

 
Trendlyne Marketwatch
Trendlyne Marketwatch
05 Feb 2024
Market closes lower, Alembic Pharmaceuticals' Q3 net profit rises 48% YoY to Rs 180.5 crore

Nifty 50closed at 21,771.70 (-82.1, -0.4%), BSE Sensexclosed at 71,731.42 (-354.2, -0.5%) while the broader Nifty 500closed at 19,853.50 (-57.3, -0.3%). Market breadth is in the red. Of the 2,062 stocks traded today, 820 were on the uptrend, and 1,222 went down.

Indian indices pared the gains from the afternoon session and closed in the red. The volatility index, Nifty VIX, rose by 6.3% and closed at 15.6 points. Varun Beverages' Q3FY24 net profit rises 76.5% YoY to Rs 132 crore, while revenue increases by 20.1% YoY. The company's EBITDA also improves by 142 bps to 15.3%.

Nifty Smallcap 100closed in the green, while Nifty Midcap 100 closed lower following the benchmark index. Nifty Auto and Nifty Healthcare closed higher than Friday’s closing level. According to Trendlyne’s sector dashboard, pharmaceutical & biotechnology emerged as the top-performing sector of the day, with a rise of over 1.4%. 

Most European indices trade in the red except for England’s FTSE 10 trading higher. US indices futures trade lower indicating a negative start. The data released by Hamburg Commercial Bank  indicated that Eurozone’s Composite PMI in January expanded to 47.9 from 47.6 in December

  • Money flow index (MFI) indicates that stocks like NMDC Steel, Housing and Urban Development Corp, Mahanagar Gas and Delhivery are in the overbought zone.

  • Sonata Software, Kaynes Technology, Computer Age Management Services, and Sapphire Foods India witness an increase in mutual fund holdings in the past month.

  • Unichem Laboratories surges to its all-time high of Rs 561.3 as it posts a net profit of Rs 84 crore in Q3FY24 compared to a net loss of Rs 63.9 crore in Q3FY23. The company posts the profit on the back of a one-time gain on the disposal of investments. Its revenue grows by 43.6% YoY to Rs 434.4 crore during the quarter. It appears in a screener of stocks with low debt.

  • Oil and gas stocks like Indian Oil Corp, Hindustan Petroleum Corp, Bharat Petroleum Corp and GAIL (India) surge more than 3% in trade. The broader BSE Oil & Gas index is also trading more than 3% up, helping it to touch its all-time high of 27,917.6.

  • TCS hits a 52-week high of Rs 4,022 following a multi-year deal with Europ Assistance, a travel insurance company, for end-to-end enterprise IT application services, incorporating gen-AI and advanced technologies across the company's operational regions.

  • Alembic Pharmaceuticals' Q3FY24 net profit rises 48% YoY to Rs 180.5 crore, while revenue increases 8.2% YoY. EBITDA improves by 14% to Rs 269 crores. The company appears in a screener for stocks with low debt.

  • Apeejay Surrendra Park Hotels' Rs 970.6 crore IPO gets bids for 1.8X the available 3.5 crore shares on offer on the first day of bidding. The retail investor quota gets bids for 4X the available 61.9 lakh shares on offer.

  • Apeejay Surrendra Park Hotels' Rs 970.6 crore IPO gets bids for 1.8X the available 3.5 crore shares on offer on the first day of bidding. The retail investor quota gets bids for 4X the available 61.9 lakh shares on offer.

  • Va Tech Wabag rises as it wins an order worth $33.5 million from SEPCO III Electric Power Construction Corp to develop an industrial wastewater treatment plant.

  • Keshav Bhajanka, Executive Director of Century Plyboards (India), predicts subdued demand for the next two quarters. He expects the plywood & laminates segment to see single-digit revenue growth in Q4. He also expects over 20% revenue growth for the MDF (medium-density fibreboard) segment in the same period.

  • Kalyani Steel’sQ3FY24 net profit rises 67%% YoY to Rs 65.3 crore due to low inventory and finance costs. Its revenue increases by 7.5% YoY to Rs 479.8 crore, while EBITDA margin improves by 722 bps to 19.9%. It appears in a screener for stocks with low debt.

  • HDFC Securities upgrades Orient Electricto 'Add' from 'Sell', with an upgraded target price of Rs 260. This indicates a potential upside of 16.3%. The brokerage expects the company's revenue to improve on the premiumisation of products, distribution expansion and brand investments. It expects the company's revenue to grow at a CAGR of 10.1% over FY23-26.

  • InterGlobe Aviationrises to its all-time high of Rs 3,300 as its net profit surges by 110.7% YoY to Rs 2,998.1 crore in Q3FY24. The profit growth is on the back of the fuel surcharge introduced in October. Revenue rises by 30.3% YoY, owing to improved demand during the holiday season. It appears in a screenerof stocks that benefit from lower crude oil prices.

  • According to a poll of economists, the RBI's monetary policy committee is expected to keep the benchmark policy rate at 6.5% during its upcoming review.

  • Varun Beverages' Q4CY23 net profit rises 76.5% YoY to Rs 132 crore, while revenue increases by 20.1% YoY. The company's EBITDA also improves by 142 bps to 15.3%. It appears in a screener for stocks with improving cash flow from operations over the past two years.

  • Greaves Cotton’s multi-brand EV retail store, AutoEVmart, partners with Zero21 to boost sales of Zero21’s electric autorickshaws and spare parts through a distribution channel of over 100 AutoEVmart outlets.

  • Ahluwalia Contracts (India)surges to its all-time high of Rs 933.4 as it bags an order worth Rs 394.4 crore from Emaar India. The order is for the construction of a residential tower and clubhouse works of Urban Oasis Phase-1 and Phase-2 in Gurgaon.

  • India’s Services PMI rises to a six-month high of 61.8 in January, compared to 59 in December 2023. This marks the 30th consecutive month where the PMI has stayed above the 50 mark, indicating an expansion in the sector.

  • L&T bags an onshore project worth Rs 2,500-5,000 crore from IndianOil Adani Ventures for the construction and commissioning of offsite tankages and associated facilities on a lump sum turnkey basis.

  • Aurobindo Pharma'ssubsidiary, Eugia US Manufacturing, signs an asset purchase agreement worth $52 million (approx. Rs 431.7 crore) with Empower Clinic Services, New Jersey. It will receive $58 million (approx. Rs 481.5 crore) in lease payments over a 20-year term.

  • PI Opportunities Fund sells a 1% stake in PB Fintechfor approx Rs 457.4 crore in a bulk deal on Friday.

  • Manoj Verma, Chief Operating Officer of Bikaji Foods, confirms the company's FY24 volume growth guidance at 18% with margins exceeding 13%. He expects the new frozen food plant to contribute Rs 200 crore in revenue over the next three years.

  • Waaree Renewable Technologiesrises as it wins an order worth Rs 547.5 crore from a global utility company to develop a solar power plant.

  • Bank of Indiafalls sharply as its net profit misses Forecaster estimates by 4.8% despite growing by 62.4% YoY to Rs 1,869.5 crore in Q3FY24. Revenue rises by 19.6% YoY, boosted by the treasury, corporate and retail banking segments. The bank's asset quality improves as its gross and net NPAs decline by 231 bps and 20 bps YoY, respectively.

  • HG Infra Engineeringbags an order worth Rs 716.1 crore as it receives a letter of acceptance (LoA) from the Central Railway for the construction of a new line from Dhule to Nardana.

  • Tata Motorssurges to its all-time highof Rs 934 as its net profit grows by 137.5% YoY to Rs 7,025.1 crore in Q3FY24. Revenue rises by 25.1% YoY to Rs 1.1 lakh crore owing to improvement in the passenger vehicles, commercial vehicles and Jaguar Land Rover segments. It appears in a screenerof stocks with high TTM EPS growth.

  • Nifty 50was trading at 21,843.80 (-10, -0.1%), BSE Sensexwas trading at 72,269.12 (183.5, 0.3%) while the broader Nifty 500was trading at 19,944.90 (34.1, 0.2%).

  • Market breadth is ticking up strongly. Of the 1,874 stocks traded today, 1,242 were gainers and 577 were losers.

Riding High:

Largecap and midcap gainers today include UCO Bank (57.75, 14.24%), Indian Overseas Bank (62.65, 11.58%) and General Insurance Corporation of India (408.65, 8.34%).

Downers:

Largecap and midcap losers today include UPL Ltd. (474.00, -11.18%), One97 Communications Ltd. (438.50, -10.00%) and Bank of India (138.60, -8.55%).

Crowd Puller Stocks

19 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included The New India Assurance Company Ltd. (265.65, 9.73%), General Insurance Corporation of India (408.65, 8.34%) and Redington Ltd. (203.85, 8.11%).

Top high volume losers on BSE were UPL Ltd. (474.00, -11.18%) and Affle (India) Ltd. (1,195.00, -2.89%).

Mahindra Lifespace Developers Ltd. (603.30, 6.32%) was trading at 14.9 times of weekly average. Graphite India Ltd. (586.20, 6.11%) and HEG Ltd. (1,846.60, 3.51%) were trading with volumes 9.3 and 9.0 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

91 stocks made 52 week highs, while 5 stocks tanked below their 52 week lows.

Stocks touching their year highs included - Abbott India Ltd. (28,069.50, 0.02%), Adani Ports & Special Economic Zone Ltd. (1,258.55, -0.23%) and Alembic Pharmaceuticals Ltd. (965.10, 0.80%).

Stocks making new 52 weeks lows included - UPL Ltd. (474.00, -11.18%) and Navin Fluorine International Ltd. (3,235.15, -2.71%).

9 stocks climbed above their 200 day SMA including Shree Renuka Sugars Ltd. (51.30, 3.22%) and Asahi India Glass Ltd. (536.40, 2.53%). 17 stocks slipped below their 200 SMA including Clean Science & Technology Ltd. (1,400.00, -4.20%) and Fine Organic Industries Ltd. (4,509.90, -3.38%).

 
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The Baseline
02 Feb 2024
Five Interesting Stocks Today

1. Infibeam Avenues: 

This internet & software services company has risen by 32.3% in the past week following its Q3FY24 results on January 23. Its revenue and net profit beat Trendlyne’s Forecaster estimates by 7.1% and 19.8%, respectively. Net profit grew by 1.1% QoQ to Rs 41.4 crore during the quarter, while revenue surged by 15.4% QoQ to Rs 911.9 crore, owing to gains from the CCAvenue segment. This helped the company appear in a screener of stocks with rising revenue for the past four quarters.

The CCAvenue platform added two lakh new merchants in the Indian market during the quarter, boosting the company's India business revenue by 16.3% QoQ to Rs 860.2 crore. This accounted for 94% of total revenue. The company’s Chairman and Managing Director (MD), Vishal Mehta said, “Our digital payments business, through CCAvenue, led the way for revenue growth. Operating or EBITDA margins and profit margins remain strong as we take advantage of scaling up the international business.”

The company’s total processed value (TPV) jumped by 1.4% QoQ on the back of a 7.6% QoQ rise in the gross take rate (GTR). TPV is the total monetary value of all transactions processed by a payment platform over a period, while GTR is the company’s cut – its percentage share from these transactions. 

Post-results, KR Choksey maintains its ‘Buy’ rating on Infibeam Avenues with an upgraded target price of Rs 41.7, indicating a potential upside of 8.3%. The brokerage believes that the company will be increasing its international footprint by launching CCAvenue and Tap Pay in the UAE and Saudi Arabia, before expanding into other GCC countries.

2. Jubilant Foodworks:

This restaurant chain and Domino’s master franchisee fell by 3.4% on Thursday after announcing a Q3 net profit decrease of 18.2% YoY to Rs 65.7 crore, missing estimates by 41.9%. The decline was due to an increase in finance costs, employee benefits, and depreciation expenses. Revenue rose by 3.1% YoY but overall fell short of Trendlyne’s Forecaster estimates by 2.3%. With the share price fall, the stock features in a screener of companies with weak momentum. 

During the quarter, Domino’s Pizza’s like-for-like (LFL) sales growth contracted 2.9% YoY, remaining in the negative territory for the fourth consecutive quarter. This was due to a 5.6% YoY decline in dine-in sales. However, delivery sales grew by 6.2% YoY. The ‘Cheesy Rewards’ program continued to gain traction, with its membership base reaching around 2.1 crore. 

The restaurant major expanded its store network in Q3FY24 by opening 58 new outlets across various brands, taking the total to 2,007 stores in India. Sameer Khetarpal, MD and CEO, said, “We will continue to add new stores as inflation moderates, and maintain our guidance of 200 new stores for FY24.” 

QSR companies have seen a volatile quarter. Despite strong demand during the Cricket World Cup and Diwali, inflationary pressures, fewer people dining out, and competition from unorganised players led to a slowdown after the festive season. The industry expects these challenges to persist for a few more quarters, but remains hopeful about demand recovery. 

Following the earnings announcement, Motilal Oswal downgraded its rating to ‘Neutral’ from ‘Buy’ and lowered the target price to Rs 480. The brokerage believes that the current valuation does not reflect the earnings pressure. It also expects sluggish demand in the near term to affect the company’s profitability.

3. DLF:

This realty company has risen by 4.3% in the past week, and trading near its 52-week high. The price rise came after the announcement of its Q3FY24 results. Its net profit has improved by 26.5% YoY to Rs 656.6 crore, while its revenue increased by 5.4% YoY to Rs 1,643.5 crore. DLF’s pre-sales rose by 261% YoY to a lifetime record of Rs 9,047 crore, led by its Privana South (luxury high-rise) project, which sold-out within 72 hours. The company appears in a screener for stocks with low debt.

With new sales bookings at Rs 13,316 crore for 9MFY24, the management says that it has exceeded its own full-year guidance of Rs 13,000 crore already. Despite this, It missed Trendlyne Forecaster’s net profit and revenue estimates by 2.4% and 7.6%, respectively, as analysts had anticipated higher numbers.

Revenue from its annuity portfolio, primarily driven by higher office occupancy, grew 8% YoY to Rs 1,476 crore. The company improved its net cash position to Rs 1,246 crore, backed by strong collections and focused cash management. 

Looking ahead to FY25, DLF plans to launch 10 million square feet with a gross development value of Rs 32,000 crore. The management expects pre-sales to exceed Rs 15,000 crore. It has a launch pipeline of Rs 79,000 crore or 32 million square feet over the next four years. 

Nuvama maintains its ‘Buy’ call on DLF, driven by strong sectoral tailwinds, an extensive launch pipeline, and the expansion of its annuity portfolio. The company appears in a screener for stocks where brokers have upgraded their recommendation or target price in the past month. 

4. Coal India:

This coal producer has risen by 36.9% in the past quarter and 7.8% over the past week. The recent surge came after the Union Cabinet for Economic Affairs, headed by the Prime Minister, approved two thermal power plants with a combined capacity of 2,200 MW. In its December 2023 business update, Coal India reported an 8.2% YoY increase in production to 71.9 million tonnes (mt), the highest since March 2022.

The world’s largest coal miner sells around 90% of its output in the open market through Fuel Supply Agreements (FSA). In H1FY24, 9% of its coal was sold through e-auctions, where it commands a premium over the FSA notified prices. FSA prices are usually discounted to moderate domestic electricity costs. E-auction premiums, which dipped to 58% in July due to softer international coal prices, bounced back to 80%-100% as power demand surged. The firm has independence in fixing base prices for e-auctions, where premiums rise with higher demand, especially during power shortages.

Despite a shift towards clean energy, India needs to increase its thermal capacity as domestic coal demand is expected to reach 1.3-1.5 billion tonnes by 2030. This growing demand was evident in the December Index of Industrial Production (IIP) numbers, where the index grew by 3.6%, and coal demand alone rose by 10.6%. Coal India, a Maharatna PSU, accounts for 80% of the country’s coal output.

The firm’s stable dividend payout ratio of around 50% and its  6% dividend yield is one of the best in the industry. With a P/E ratio of 7.6, Coal India is trading at a discount compared to its Chinese peers. ICICI Direct states, “As the government plans to achieve 24-hour power supply by 2025, coal production at CIL will grow at a CAGR of 11% over FY23-26 to 950 MT by 2025.” The brokerage has a ‘Buy’ rating on this firm with a target price of Rs 500.

5. ACC:

This cement & cement products firm rose 10% on Thursday as its Q3FY24 net profit grew by 137.9% YoY to Rs 537.6 crore. The company appears in ascreener of stocks with improving net profits and margins. According to Trendlyne’s Technicals, the stock outperformed the cement and construction sector by 3.7%, with a 11.4% increase in the past month. 

Revenue rose by 8.3% YoY in Q3FY24, thanks to increased demand and higher realization. The firm’s realization rose by 4.9% YoY to Rs 5,185 during the same period. ACC’s EBITDA margin improved by 840 bps YoY, thanks to lower fuel/freight and fixed expenses. With the acquisition of a majority stake in Asian Cement and Concrete (ACCPL), ACC expanded its cement capacity to 38.6 mtpa, setting the stage for a 10% CAGR volume growth over FY24-26. This is a jump from the 2% CAGR over the last decade.

ACC’s management expects EBITDA margin expansion of Rs 200/tonne in FY25-26, helped by the implementation of a waste heat recovery system (Rs 90/tonne), logistic optimization (Rs 60/tonne), and raw material optimization (50/tonne). The management has guided FY24 capex at Rs 7,000 crore, including Rs 200 crore for capacity enhancement at the newly acquired Sanghi Industries. ACC’s sales volumes are poised to hit 36.2 mtpa in FY24, with an expected 5.3% CAGR growth to 41.7 mtpa by FY26.  

Motilal Oswal highlights the start of production at the Ametha Plant (1 mtpa) and additional capacity from ACCPL (1.5 mtpa) boosts ACC's total capacity by 7% QoQ. With this expansion, the brokerage expects realization to rise by 10.2% by FY27. It maintains an ‘Accumulate’ rating on the stock.

Trendlyne's analysts identify stocks that are seeing interesting price movements, analyst calls, or new developments. These are not buy recommendations.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
02 Feb 2024
Market closes higher, Dhanlaxmi Bank's net profit declines by 86% YoY to Rs 3 crore in Q3
By Trendlyne Analysis

Nifty 50closed at 21,853.80 (156.4, 0.7%), BSE Sensexclosed at 72,085.63 (440.3, 0.6%) while the broader Nifty 500closed at 19,910.80 (133.5, 0.7%). Market breadth is holding steady. Of the 2,017 stocks traded today, 1,001 were gainers and 990 were losers.

Indian indices maintained their gains from the afternoon session and closed in the green. The Indian volatility index, Nifty VIX, rose 1.6% and closed at 14.7 points. Abbott India closed 8.4% higher after its Q3FY24 net profit grew by 26% YoY to Rs 311 crore due to lower raw material and inventory expenses.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, taking cues from the benchmark index. Nifty Metal and Nifty IT closed higher than their Thursday close.  According to Trendlyne’s sector dashboard, Oil & Gas emerged as the top-performing sector of the week, with a rise of 8.9%.

Major Asian indices closed in the green, except for China’s Shanghai Composite and Hong Kong’s Hang Seng closing lower. European indices traded in the green amid positive global cues. US index futures traded higher, indicating a positive start to the trading session. Brent crude oil futures traded higher after closing over 2% lower for two consecutive trading sessions.

  • Relative strength index (RSI) indicates that stocks like Infibeam Avenues, NBCC (India), Elgi Equipments and EIH are in the overbought zone.

  • Dhanlaxmi Bank falls sharply as its net profit declines by 86% YoY to Rs 3 crore in Q3FY24 due to higher interest and employee benefit expenses. Revenue grows by 11.4% YoY, owing to gains in the retail and corporate banking segments. However, the bank's asset quality improves as its gross and net NPAs expand by 102 bps and 55 bps YoY, respectively.

  • TVS Motor rises as its monthly wholesales grow by 23% YoY to 3.4 lakh units, driven by motorcycles and electric vehicles. The company's export sales also increase by 22% YoY. It appears in a screener of stocks with increasing quarterly revenue.

  • Rashi Peripherals, a national distribution partner for global tech brands, sets its IPO price band at Rs 295-311 per share. The issue, valued at Rs 600 crore, is completely a fresh issue and opens on February 7.

  • Torrent Pharmaceuticals' Q3FY24 net profit rises 51.7% YoY to Rs 443 crore, with total revenue up 8.8% YoY. The board approves a dividend of Rs 22 per equity share, expected to be paid on or around February 23, 2024. The company appears in a screener for stocks with increasing profits over the past three quarters.

  • Kaveri Seed falls as its Q3FY24 net profit falls by 71% YoY to Rs 11.1 crore due to an increase in the cost of raw materials. Its revenue falls by 1% YoY to Rs 142.6 crore, while EBITA margin declines 301 bps to 6.8%.

  • Aegis Logistics' Q3FY24 net profit grows by 3.8% YoY to Rs 130.1 crore due to lower inventory expenses. However, its revenue decreases by 10.2% YoY on the back of falling liquid and gas terminal divisions. The company appears in a screener of stocks with high TTM EPS growth.

  • Oil and gas stocks like Bharat Petroleum Corp, Indian Oil Corp, Hindustan Petroleum Corp and Oil & Natural Gas Corp surge more than 3% in trade. All constituents of the broader BSE Oil & Gas index are also trading in the the green, helping it to touch its all-time high of 26,912.8.

  • Himanshu Mody, CFO of Suzlon Energy, anticipates improved order execution in Q4FY24, expecting FY24's execution to align with FY23 levels. He adds that the company’s order book stands at 3.2 GW and will be executed by FY26.

  • Abbott India rises to an all-time high of Rs 515.9 as its Q3FY24 net profit grows by 26% YoY to Rs 311 crore due to lower raw material and inventory expenses. Its revenue increases by 8.7% YoY. The company appears in a screener of stocks with growing net profit and margins.

  • Devyani International's Q3FY24 net profit falls 86.6% YoY to Rs 96.2 crore while revenue rises 6.2% YoY. The decline in profit is attributed to increased employee benefits, depreciation and amortisation, and tax expenses. The company appears in a screener for stocks with growing costs for long-term projects.

  • Foreign institutional investors withdraw Rs 6,079 crore from the equity market over the past week, according to Trendlyne's FII dashboard. Index options witness the highest outflow of Rs 1.8 lakh crore from foreign investors. Meanwhile, mutual funds are net buyers in the equity market, injecting Rs 4,120.9 crore during the same period.

  • Castrol India hits a new 52-week high of Rs 208.2 as its Q3FY24 revenue rises 7.6% YoY to Rs 1,286.3 crore. Its net profit grows by 25.2% YoY to Rs 241.9 crore due to lower inventory expenses. The firm also approves a dividend of Rs 4.5 per share.

  • Aadhar Housing Finance refiles its draft initial share offering documents with SEBI, intending to raise Rs 5,000 crore this year. As per the DRHP, the offer includes a fresh issue of shares of up to Rs 1,000 crore and an offer-for-sale of up to Rs 4,000 crore.

  • Hero MotoCorp rises to an all-time high of Rs 4,740 as its monthly wholesales increase by 22% YoY to 4,33,598 units, driven by motorcycles and domestic business. The company appears in a screenerof stocks with increasing quarterly revenue.

  • Mahindra Holidays & Resorts India announces the resignation of MD and CEO Kavinder Singh, effective May 16, 2024. Following his departure, Manoj Bhat will assume the roles of MD and CEO.

  • PB Fintech (Policybazaar) is falling as reports suggest that 36 lakh shares (0.8% equity), amounting to Rs 354.6 crore, change hands in two large trades.

  • Rites plunges sharply as its net profit declines by 14.2% YoY to Rs 120.1 crore in Q3FY24 due to higher employee benefit, travel and supplies & services expenses. Revenue rises marginally by 0.8% YoY, owing to improvement in domestic consultancy and turnkey construction projects. It features in a screener of stocks where mutual funds have reduced their shareholding in the past quarter.

  • Indian Hotels Company rises to an all-time high of Rs 515.9 as its Q3FY24 net profit grows by 18.1% YoY to Rs 452 crore. Its revenue increases by 16.5% YoY, helped by growth in management fees, and international and domestic businesses. The company's EBITDA margin improves by 186 bps YoY due to lower finance expenses.

  • Gokaldas Exports is rising as it acquires a 100% stake in Matrix Clothing for Rs 489 crore. The firm has paid Rs 247.5 crore of this by allotting its preference shares in a share swap.

  • Ashish Kataria, Director of Ashoka Buildcon, projects a 30% revenue growth for FY24 and anticipates order inflows of Rs 8,000-9,000 crore in the upcoming term. He points to a robust bidding pipeline and mentions the company's current order book at Rs 15,000 crore, with recent additions in the power and bridges segments.

  • GMM Pfaudler falls as its EBITDA margin falls by 168 bps YoY due to higher inventory and employee benefit expenses. However, its net profit rises by 69.5% YoY to Rs 31.7 crore and revenue increases by 8% YoY, helped by growth in the systems and services segments.

  • Mahanagar Gas rises as it acquires a 100% stake in Unison Enviro for a cash consideration of Rs 562.1 crore.

  • Coforge's Chief Executive Officer Sudhir Singh sells a 0.3% stake in the company on Thursday. He now holds 0.5%.

  • MphasiS' Q3FY24 net profit falls 4.7% QoQ to Rs 373.6 crore due to rising employee benefits and finance costs. Revenue grows by 1.9% QoQ to Rs 3,337.9 crore, helped by the banking & financial services, logistics & transportation and insurance segments. It appears in a screenerof stocks with declining net profit for the past four quarters.

Riding High:

Largecap and midcap gainers today include NHPC Ltd. (100.65, 10.12%), Bharat Petroleum Corporation Ltd. (558.35, 9.81%) and Indian Oil Corporation Ltd. (162.90, 8.78%).

Downers:

Largecap and midcap losers today include One97 Communications Ltd. (487.20, -20.00%), Bayer Cropscience Ltd. (5,788.65, -4.59%) and Max Healthcare Institute Ltd. (766.40, -4.57%).

Volume Shockers

29 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included Engineers India Ltd. (261.35, 10.32%), Indian Oil Corporation Ltd. (162.90, 8.78%) and Abbott India Ltd. (28,064.30, 8.41%).

Top high volume losers on BSE were One97 Communications Ltd. (487.20, -20.00%), Bikaji Foods International Ltd. (547.55, -6.27%) and Bayer Cropscience Ltd. (5,788.65, -4.59%).

Mahindra Holidays & Resorts India Ltd. (418.65, 3.27%) was trading at 8.2 times of weekly average. Jubilant Pharmova Ltd. (592.25, 2.71%) and GMM Pfaudler Ltd. (1,512.30, -2.78%) were trading with volumes 8.0 and 6.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

87 stocks took off, crossing 52 week highs, while 2 stocks were underachievers and hit their 52 week lows.

Stocks touching their year highs included - Abbott India Ltd. (28,064.30, 8.41%), Adani Ports & Special Economic Zone Ltd. (1,261.45, 3.50%) and Amara Raja Energy & Mobility Ltd. (895.30, 1.70%).

Stocks making new 52 weeks lows included - One97 Communications Ltd. (487.20, -20.00%) and Vedant Fashions Ltd. (961.65, -2.06%).

10 stocks climbed above their 200 day SMA including Aditya Birla Capital Ltd. (180.35, 8.09%) and Shree Renuka Sugars Ltd. (49.70, 5.52%). 10 stocks slipped below their 200 SMA including Praj Industries Ltd. (477.25, -3.94%) and Galaxy Surfactants Ltd. (2,622.65, -3.28%).

 
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The Baseline
01 Feb 2024
Which stocks did superstar investors buy in Q3FY24?
By Abhiraj Panchal

Many investors closely track the investments of superstar investors like Rekha Jhunjhunwala, Ashish Kacholia, Sunil Singhania, and Vijay Kedia for valuable market insights. Their buys and sells help investors identify potentially profitable sectors and stocks. In this piece, we look at some investments made by these superstar investors during Q3FY24.

(You can now also invest in shadow superstar baskets available on Starfolio, which are updated and rebalanced as per Trendlyne's superstar portfolios).

The chart below looks at changes in superstar investors' current portfolio net worth. Note that net worth reflects both changes in current holdings as well as new buys and sells. 

All superstars see a rise in their net worth in Q3FY24

Each superstar investor’s public portfolio reflects their unique investing style and their preferred approaches. The following chart provides a breakdown of the dominant sectors in each investor’s portfolio. 

Industries preferred by superstars

Industry preferences among the superstars vary: Rare Enterprises (Rekha Jhunjhunwala and Rakesh’s portfolio) leans towards textiles, apparels and accessories stocks, while Sunil Singhania and Porinju Veliyath favour software and services. Ashish Kacholia prefers chemicals and petrochemicals. Vijay Kedia’s preferred sector is automobiles & auto components, and Dolly Khanna prefers oil and gas.

Rare Enterprises continues to invest in D B Realty 

Rakesh Jhunjhunwala’s portfolio, now managed by Rekha Jhunjhunwala and Rare Enterprises following his passing, grew by around 22% QoQ to Rs 48,186.3 crore by the end of Q3FY24. During the October-December quarter, the firm did not add new stocks to its portfolio, and increased its stake in just one company. 

Rare Enterprises increased its holding in realty stock D B Realty by 1%, and now owns 3% of the company. 

Rare Enterprises buys a 1% stake in D B Realty

This marks the second consecutive quarter of increased investment in the realty company, after consistently holding 1.4% in Q4FY23 and Q1FY24. Over the past quarter, D B Realty’s share price has risen by 52.1%. 

Sunil Singhania’s Abakkus Fund invests in an industrial machinery company 

Sunil Singhania’s Abakkus Fund saw its net worth rise by 19.2% QoQ to Rs 2,838.9 crore in Q3FY24. The fund's significant new investment was in Shriram Pistons & Rings, an industrial machinery company where it bought a 2.3% stake. The company has a Durability score of 80, indicating high financial strength, and an affordable Valuation along with bullish Momentum. Its price rose by 64.8% in the past quarter.

Sunil Singhania adds Shriram Pistons & Rings to his portfolio

The fund also purchased a minor stake in household appliances manufacturer Hindware Home Innovation. It now holds 4.4% of the company.

Ashish Kacholia goes on a buying spree during the quarter

Ashish Kacholia’s net worth rose by 8.8% QoQ to Rs 2,764.2 crore in Q3FY24. During the quarter, he added four new small-cap stocks to his portfolio. He acquired a 2% stake in Updater Services, a commercial services company, whose share price rose by 33% over the past quarter. He also added Brand Concepts to his portfolio, acquiring a 1.4% stake. The textile firm has risen over 3x in the past year. 

Ashish Kacholia buys a 2% stake in Updater Services

The marquee investor also added Tanfac Industries, buying a 1.2% stake in the commodity chemicals company. He reintroduced SG Finserve into his portfolio during the quarter and now holds a 1.1% stake. He reduced his stake in this financial services provider to below 1% in Q2FY24. 

Kacholia increased his stake in Zaggle Prepaid Ocean Services to 2.2% by buying 0.5% during the quarter. He has maintained a stake in this IT software products company since its listing on the stock exchanges. He also bought an additional 0.1% stake in La Opala RG, taking his holding to 1.7% in the houseware products manufacturer.

Vijay Kedia buys a minor stake in a mid-cap company

Vijay Kedia’s net worth increased by 6.3% QoQ to Rs 1,475.6 crore in Q3FY24. His activity this quarter was limited to acquiring a minor stake in Vaibhav Global. He now holds a 2% stake in the online apparel and accessories company. Kedia has been a stakeholder in Vaibhav Global since before March 2017. It has risen by 275.8% in the past five years. Ashish Kacholia also holds a 1.2% stake in the company.

Dolly Khanna expands her portfolio with multiple additions 

Dolly Khanna’s net worth increased by 17.5% QoQ in Q3FY24 to Rs 422.9 crore. During the quarter, the investor added four new companies to her portfolio and increased stakes in six others. Among her new acquisitions, she bought a 1.2% stake each in hotels company Savera Industries and sugar stock Zuari Industries. These stocks rose by 47.5% and 98.3%, respectively, in the past quarter. Khanna also added construction and finance companies J Kumar Infraprojects and Ujjivan Financial Services by buying 1% and 1.1% stakes, respectively.   

Dolly Khanna adds multiple stocks to her portfolio

Khanna bought a 0.2% stake each in metals company Prakash Industries and textiles firm Deepak Spinners, taking her holdings in these companies to 1.2% and 1.8%, respectively. The ace investor added around 0.1% stakes each in sugar stock KCP Sugar & Industries (now holds 1.4%), fertilizer company Mangalore Chemicals (taking the current holding to 1.3%), and commodity printing firm Control Print (now holds 1.3%). She also increased her stake in Rajshree Sugars & Chemicals to 1.1%. With this, Dolly Khanna publicly holds 18 companies. 

Porinju Veliyath increases stakes in three companies in Q3

Porinju Veliyath’s net worth increased by 8.2% QoQ to Rs 225.9 crore in Q2FY24. During the quarter, while he has not added new companies to his portfolio, he increased investments in three existing holdings. After maintaining a 3.2% stake for two consecutive quarters, Porinju bought 1.6% in pharmaceuticals company Kerala Ayurveda. He currently holds a 4.8% stake in the company. Its stock price has risen by 172% in the past year.

Porinju buys a 1.6% stake in Kerala Ayurveda

In Q3FY24, Porinju also increased his stake in Aurum Proptech, an IT consulting & software firm, by 1%, raising his investment to 4.5%. This marks the third consecutive quarter where he has increased his stake in the company. During the quarter, Porinju also bought a minor stake in a small-cap metals company, P G Foils. He currently holds 1.1% of the company. He added P G Foils to his portfolio in Q2FY24. 

 
Trendlyne Marketwatch
Trendlyne Marketwatch
01 Feb 2024
Market closes lower, Titan's Q3FY24 net profit rises 16.5% YoY to Rs 1,053 crore
By Trendlyne Analysis

Nifty 50closed at 21,697.45 (-28.3, -0.1%), BSE Sensexclosed at 71,645.30 (-106.8, -0.2%) while the broader Nifty 500closed at 19,777.35 (-24.8, -0.1%). Market breadth is in the red. Of the 2,015 stocks traded today, 818 were gainers and 1,162 were losers.

Indian indices started the trading session in green but fell at the close of the interim budget speech. Nifty 50switched between losses and gains and ended the session marginally lower post the interim budget speech. The Indian volatility index fell sharply and closed at 14.5 points. India’s GST collections rose 10% YoY to Rs 1.7 lakh crore in January, according to the data released by the finance ministry. 

Nifty Smallcap 100 closed in the green, while the Nifty Midcap 100 closed lower. Nifty Auto and Nifty PSU Bank closed higher than their Wednesday close. According to Trendlyne’s sector dashboard, Transportation emerged as the top-performing sector of the day, with a rise of 1.4%.

European indices traded in the red, except for England’s FTSE 100 index, which traded flat. Major Asian indices closed mixed on a volatile day of trade. US index futures traded in the green, indicating a positive start to the trading session. Brent crude oil traded higher after falling over 2.3% on Wednesday.

  • Tata Consumer Productssees a long buildup in its February 29 future series as its open interest rises 35.3% with a put-call ratio of 1.

  • Jindal Steel & Power is falling as Bimlendra Jha resigns as Managing Director (MD) of the company with effect from January 31.

  • PSU Bank stocks like Punjab & Sind Bank, Indian Overseas Bank, Indian Bank and Bank of India surge more than 4% in trade. All constituents of the broader Nifty PSU Bank index are also trading in the green, helping it to touch its all-time high of 6,455.2.

  • Titan's Q3FY24 net profit rises 16.5% YoY to Rs 1,053 crore due to lower inventory expenses. Its revenue increases by 22% YoY, helped by the watches & wearables and jewellery segments. The company appears in a screener of stocks with improving RoE over the past two years.

  • Tata Motors, InterGlobe Aviation, LIC Housing Finance, andDevyani International's weekly average delivery volumes rise ahead of their Q3FY24 results tomorrow.

  • Amara Raja Energy & Mobility touches a new 52-week high of Rs 900 as its Q3FY24 net profit rises by 14.8% YoY to Rs 254.8 crore. Its revenue also increases by 15.4% YoY due to growth in the lead acid batteries and allied products segment. The stock shows up in a screener for companies with strong momentum.

  • BLS E-Services' Rs 310.9 crore IPO gets bids for 100.6X the available 1.4 crore shares on offer on the third day of bidding. The retail investor quota gets bids for 200X the available 20.7 lakh shares on offer.

  • Dr. Lal Pathlabs' Q3FY24 revenue rises 10.1% YoY to Rs 539 crore. Its net profit grows by 53.3% YoY to Rs 82 crore due to a marginal decline in operating expenses and lower finance costs. Its EBITDA increases by 24.6% YoY to Rs 141 core and its margin improves by 3bps to 26.1%.

  • Tube Investment of India's Q3FY24 net profit rises by 125.7% YoY to Rs 531.1 crore. Its revenue increases by 15.3% YoY, helped by engineering, electric vehicles, power systems, and industrial systems. However, the company's EBITDA margin falls by 180 bps YoY due to higher raw material, employee benefit and inventory expenses.

  • Motilal Oswal maintains its 'Buy' rating on TeamLease Services with a target price of Rs 3,450 per share. This indicates a potential upside of 22.3%. The brokerage remains positive on the company's medium to long-term outlook owing to the formalisation of the labour market. It expects the company's revenue to grow at a CAGR of 19% over FY23-26.

  • Adani Enterprises' Q3FY24 net profit rises 166.6% YoY to Rs 1,972.8 crore, while revenue grows by 7% YoY. The company's margin improves by 535 basis points to 11%. It appears in a screener for stocks with strong annual EPS growth.

  • India Cements falls as the Enforcement Directorate searches its corporate offices to investigate irregularities related to the Foreign Exchange Management Act. The company does not anticipate any significant impact regarding the ongoing investigation.

  • Ion Exchange (India)wins a contract worth Rs 152.5 crore from Material Construction Trading FZCO, UAE, for the development of a desalinated water unit for a project in North Africa.

  • Deepak Fertilisers & Petrochemicals Corpfalls as its Q3FY24 net profit plunges by 76.9% YoY to Rs 57.6 crore due to higher inventory and finance expenses. Its revenue also declines by 33.1% YoY due to falling trading and manufacturing segments.

  • India’s GST collections rise 10% YoY to Rs 1.7 lakh crore in January, according to the data released by the finance ministry.

  • Tata Motors' January 2024 total domestic wholesales rise 5.8% YoY to 84,276 units. Total commercial vehicle wholesales fall 2.1%, while passenger vehicle wholesales improve 11.9%.

  • Swan Energyrises to an all-time high of Rs 665.9 as it reports a net profit of Rs 220 crore in Q3FY24, as against a net loss of Rs 15.7 crore in Q3FY23. Its revenue increases by 14.7x YoY, helped by growth in textiles, energy, construction and distribution segments.

  • Fisheries stocks like Avanti Feedsand Godrej Agrovetare rising following the Finance Minister's announcement of setting up five integrated aquaparks, in response to seafood exports doubling since 2013.

  • Maneesh Dangi, Founder of Macro Mosaic Investing and Research, says this budget focuses on disinflation. He believes a private capex boom, similar to the one in the 2000s, is unlikely soon, as companies will need time to increase their spending.  #BudgetDay

  • Housing financestocks like Housing and Urban Development Corp, PNB Housing Finance, Aavas Financiers, and Can Fin Homestrade in the green following FM Nirmala Sitharaman's announcement of new schemes aimed at helping sections of the middle class living in rented accommodation to build their own houses. #BudgetDay

  • Finance Minister announces three major railway corridors under PM Gati Shakti: energy, mineral and cement corridors; port connectivity corridors; and high traffic density corridors. CRISIL believes these will improve freight movement and reduce India's logistics costs from 12% of GDP. Additionally, the FY25 railway expenditure target is set at Rs 2.5 lakh crore. #BudgetDay

  • Renewable Energy stocks like KPI Green Energy, Waaree Renewable Technologies, Suzlon Energy, Borosil Renewables, and Power Grid Corptrade in the green. This comes after the announcement by FM Nirmala Sitharaman of setting up 100 million tonnes of coal gasification and liquefaction capacity by 2030, and promoting green mobility through increased e-bus adoption and new biomanufacturing and bio foundry schemes in the Budget 2024.

  • Finance Minister Nirmala Sitharaman announces a new scheme offering Rs 1 lakh crore in 50-year interest-free loans, aimed at providing low or zero-interest long-term funding for private sector research in sunrise sectors. #BudgetDay

  • The FM announces the FY25 expenditure target for semiconductors at Rs 6,903 crore, and Rs 6,200 crore for the PLI scheme.  #BudgetDay

  • The government sets the tax receipts target at Rs 26 lakh crore, with no changes in direct and indirect tax structures. #BudgetDay

  • The fiscal deficit target for FY24 is lowered to 5.8% of GDP from the previous 5.9%. The target for FY25 is set at 5.1%. #BudgetDay

  • Finance Minister Nirmala Sitharaman reports a $596 billion FDI inflow from FY14 to FY23. #BudgetDay

  • The government ramps up its infrastructure spending for FY25 by 11.1% to Rs 11.1 lakh crore. #BudgetDay

  • Finance Minister Nirmala Sitharaman says that Mudra Yojana has issued 43 crore loans, amounting to Rs 22.5 lakh crore, while sharing statistics on youth-focused initiatives. #BudgetDay

  • Indus Towers declines as 25.9 crore shares (9.6% equity), amounting to Rs 5,500 crore, reportedly change hands in multiple large trades.

  • Godrej Consumer Productssurges to touch its all-time high of Rs 1,314.3 as its net profit grows by 6.3% YoY to Rs 581 crore in Q3FY24. Revenue rises by 1.7% YoY due to gains in the Indian and Indonesian markets. It features in a screenerof stocks where brokers have upgraded their recommendation or target price over the past quarter.

  • Deepak Nitriteis rising as it signs a memorandum of understanding (MoU) with the Gujarat government to set up polycarbonate, methyl methacrylate and aniline production plants in Dahej, Gujarat. The company plans to invest Rs 9,000 crore to establish the plants.

  • India’s manufacturing PMI rises to a 4-month high of 56.5 in January due to an increase in new orders driven by robust demand. The PMI reading remains above the 50 mark for the 31st consecutive month.

  • Bajaj Auto's January 2024 wholesales rise 23.6% to 3.6 lakh units. Two-wheeler wholesales grow 26.8%, while commercial vehicle wholesales improve by 6.4%.

  • Motherson Sumi Wiring Indiarises to its 52-week high of Rs 68.5 per share as its net profit grows by 58.1% YoY to Rs 167.9 crore in Q3FY24. Revenue increases by 26.3% YoY on the back of capacity expansion. It shows up in a screener of stocks with low debt.

  • One97 Communications (Paytm) falls 20% following an RBI order to halt new customer onboarding immediately under Section 35A of the Banking Regulations Act, citing continued supervisory concerns. The regulator has also prohibited Paytm Payments Bank from accepting deposits and top-ups, including wallets and FASTag, starting February 29.

  • Shree Cements' Q3FY24 net profit rises by 148.8% YoY to Rs 701.9 crore. Its revenue increases by 21.5% YoY due to growth in premium products and RMC segments. The company's EBITDA margin improves by 729 bps YoY on lower inventory and power & fuel expenses.

Riding High:

Largecap and midcap gainers today include Godrej Consumer Products Ltd. (1,254.55, 7.76%), Indian Overseas Bank (52.05, 6.01%) and UCO Bank (48.90, 5.16%).

Downers:

Largecap and midcap losers today include One97 Communications Ltd. (609.00, -19.99%), Aurobindo Pharma Ltd. (1,070.80, -6.92%) and Voltas Ltd. (1,048.75, -4.03%).

Crowd Puller Stocks

27 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included Housing and Urban Development Corporation Ltd. (205.90, 19.47%), Godrej Consumer Products Ltd. (1,254.55, 7.76%) and Motherson Sumi Wiring India Ltd. (69.95, 7.53%).

Top high volume losers on BSE were India Cements Ltd. (242.20, -7.35%), Aurobindo Pharma Ltd. (1,070.80, -6.92%) and C.E. Info Systems Ltd. (1,835.05, -6.56%).

Pfizer Ltd. (4,578.20, 5.90%) was trading at 20.2 times of weekly average. Indus Towers Ltd. (219.00, -1.33%) and Aegis Logistics Ltd. (388.90, 2.98%) were trading with volumes 13.2 and 10.3 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

72 stocks took off, crossing 52 week highs, while 2 stocks were underachievers and hit their 52 week lows.

Stocks touching their year highs included - Adani Ports & Special Economic Zone Ltd. (1,218.85, 0.93%), AIA Engineering Ltd. (4,356.40, 6.06%) and Amara Raja Energy & Mobility Ltd. (880.50, -0.96%).

Stocks making new 52 weeks lows included - UPL Ltd. (530.05, -1.42%) and Vedant Fashions Ltd. (982.85, -2.06%).

22 stocks climbed above their 200 day SMA including Astral Ltd. (1,889.20, 3.21%) and Dabur India Ltd. (554.40, 2.74%). 8 stocks slipped below their 200 SMA including Deepak Fertilisers & Petrochemicals Corporation Ltd. (579.75, -6.21%) and Jubilant Foodworks Ltd. (501.90, -3.40%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
31 Jan 2024
Market closes higher, Suzlon Energy's net profit rises by 159% YoY to Rs 203.1 crore in Q3
By Trendlyne Analysis

Nifty 50 closed at 21,725.70 (203.6, 1.0%), BSE Sensex closed at 71,752.11 (612.2, 0.9%) while the broader Nifty 500 closed at 19,802.10 (227.9, 1.2%), of the 2,022 stocks traded today, 1,357 were gainers and 632 were losers.

Indian indices extended the gains from afternoon session and closed in the green. The volatility index, Nifty VIX, dropped by 0.3% and closed at 16.1 points. Maruti Suzuki India's Q3FY24 net profit rises by 33.3% YoY to Rs 3,206.8 crore. Its revenue increases by 14.6% YoY, driven by the utility vehicles, vans, and light commercial vehicles segments.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green following the benchmark index. Nifty Bank and Nifty Pharma closed higher than Tuesday’s closing level. According to Trendlyne’s sector dashboard, healthcare equipment & supplies emerged as the top-performing sector of the day, with a rise of over 2.5%.

Most European indices trade in the green except for England’s FTSE 100 and Germany’s DAX trading lower. US indices futures trade lower indicating a negative start. The German government's data indicated that the country’s retail sales in December contracted by 1.6% MoM against estimates of 0.7% growth.

  • Money flow index (MFI) indicates that stocks like NMDC Steel, PNC Infratech, Tata Investment Corp and IRB Infrastructure Developers are in the overbought zone.

  • Welspun Living rises as its Q3FY24 net profit increases by 3.2x YoY to Rs 176.8 crore due to lower inventory expenses. Its revenue grows by 29% YoY, helped by gains in the home textiles and flooring segments. The company's board has also allotted a capex of $12.5 million (approx. Rs 103.8 crore) to set up a unit in Ohio, USA.

  • Kajaria Ceramics is rising as its net profit grows by 40.2% YoY to Rs 104.2 crore in Q3FY24. Revenue increases by 5.5% YoY, helped by improved tile sales. EBITDA margin expands by 341 bps YoY, owing to reduced power & fuel and finance costs. The company appears in a screener of stocks near their 52-week high with significant volumes.

  • Suzlon Energy rises as its Q3FY24 revenue increases by 7.2% YoY to Rs 1,569.7 crore. Its net profit grows by 159% YoY to Rs 203.1 crore due to an 80% YoY decline in finance costs. The firm appears in a screener of stocks with improving net profit margin.

  • Maruti Suzuki India's Q3FY24 net profit rises by 33.3% YoY to Rs 3,206.8 crore. Its revenue increases by 14.6% YoY, driven by the utility vehicles, vans, and light commercial vehicles segments, while EBITDA margin improves by 198 bps YoY.

  • Apeejay Surrendra Park Hotels sets its IPO price band at Rs 147-155 per share. The issue size is Rs 920 crore, with a fresh issue up to Rs 600 crore and an offer for sale of Rs 320 crore. The issue opens on February 5.

  • Healthcare stocks like Max Healthcare Institute, Dr. Reddy's Laboratories, Syngene International and Sun Pharmaceutical Industries surge more than 4% in trade. This helps the broader Nifty Healthcare index to touch its all-time high of 11,438.8.

  • BLS E-Services' Rs 310.9 crore IPO gets bids for 32X the available 1.4 crore shares on offer on the second day of bidding. The retail investor quota gets bids for 100.4X the available 20.7 lakh shares on offer.

  • Max Healthcare Institute rises sharply as its net profit surges by 30.1% YoY to Rs 289.3 crore in Q3FY23. Revenue grows by 16.9% YoY, while its EBITDA margin expands by 140 bps YoY on the back of reduced finance costs. The company appears in a screener of stocks with improving return on equity (RoE) over the past two years.

  • Reports suggest that 1.4 crore shares (4.4% equity) of Religare Enterprises, amounting to Rs 338 crore, change hands in a large trade.

  • Edelweiss maintains its 'Buy' rating on DLF with an upgraded target price of Rs 1,021 per share. This indicates a potential upside of 28%. The brokerage is positive on the realtor owing to its strong launch pipeline, steady project acquisitions and increase in the sales velocity. It expects the company's revenue to grow at a CAGR of 7.6% over FY23-26.

  • Man Infraconstructionis rising as it achieves record sales of Rs 333 crore for its luxurious residential project, Aaradhya OnePark in Mumbai. This amount represents 25% of the project's total estimated sales.

  • Voltas rises to a new 52-week high of Rs 1,095.8 as its Q3FY24 net loss contracts by 72.4% YoY to Rs 30.4 crore. Its revenue increases by 31.8% YoY, helped by gains in the unitary cooling products and electro-mechanical projects segments. The company appears in a screener for stocks with strong momentum.

  • The Centre lowers import duty on mobile phone components to 10% from 15% earlier. The components include rear covers, battery enclosures, primary lenses, and other mechanical components, say reports.

  • Dr. Reddy's Laboratories rises to an all-time high of Rs 6,095.2 as its Q3FY24 net profit grows by 11% YoY to Rs 1,380.9 crore due to lower raw material and finance expenses. Its revenue increases by 8.8% YoY, helped by gains in the global generics segment. It appears in a screener of stocks with growing quarterly revenue.

  • Lloyd Enterprises is rising as it acquires a 60.4% stake in Lloyds Reality Developers with a fresh fund infusion of Rs 110 crore. Post this all-cash deal, Lloyds Reality Developers becomes debt-free.

  • Cochin Shipyard rises to an all-time high of Rs 945 as its Q3FY24 net profit increases by 103.3% YoY to Rs 224.4 crore. Its revenue grows by 64.6% YoY, helped by gains in the ship building and ship repair segments. The company appears in a screener of stocks with improving net cash flow.

  • The International Monetary Fund (IMF) raises India’s GDP growth forecast for FY24 by 40 bps to 6.7%, and also revises FY25 and FY26 projection by 20 bps to 6.5%. The IMF expects strong growth to continue in India, reflecting robust domestic demand.

  • KPI Green Energy hits a new 52-week high of Rs 1,821.1 as its subsidiary, KPIG Energia, secures an order from Skywin Paper Industries. The order includes building a 5MW captive power plant in various phases over FY24-25.

  • Nova Agritech’s shares debut on the bourses at a 34.2% premium to the issue price of Rs 41. The Rs 143.8 crore IPO has received bids for 109.4 times the total shares on offer.

  • KEC Internationalrises as its Q3FY24 net profit grows by 4.5x YoY to Rs 96.9 crore. Its revenue increases by 14.4% YoY and EBITDA margin improves by 158 bps YoY due to lower inventory and sub-contracting expenses.

  • HSBC resumes its 'Buy' rating on Titagarh Rail Systems with an upgraded target price of Rs 1,200. The brokerage believes that the company has improved its competitive position in the passenger coach market. It highlights the robust growth in the wagon industry, which bodes well for the company.

  • PB Fintechrises to a new 52-week high of Rs 1,039.9 as it reports a net profit of Rs 38 crore in Q3FY24, as compared to a net loss of Rs 20.2 crore in Q2FY24. The rise in net profit is due to lower expenses in employee benefits, finance, advertising and network. Its revenue rises by 6.1% QoQ, helped by performance in the insurance broker and other services segment.

  • JSL Overseas, promoter of Jindal Stainless, buys a 0.5% stake in the company. It now holds a 12.2% stake.

  • Ashish Kacholia sells a 0.5% stake in Venus Pipes & Tubes for approx Rs 15.6 crore in a bulk deal on Tuesday.

  • Larsen & Toubro's Q3FY24 net profit rises by 15.4% YoY to Rs 2,947.4 crore due to lower inventory and finance expenses. Its revenue grows by 18.8% YoY helped by growth in infrastructure projects, energy projects and IT & technology services segments. The company appears in a screener of stocks with growing net profit and margins.

Riding High:

Largecap and midcap gainers today include PB Fintech Ltd. (1,002.40, 10.24%), Voltas Ltd. (1,092.75, 7.46%) and UCO Bank (46.50, 6.29%).

Downers:

Largecap and midcap losers today include Larsen & Toubro Ltd. (3,479.75, -4.23%), Indus Towers Ltd. (221.95, -3.48%) and Vedant Fashions Ltd. (1003.50, -2.61%).

Volume Rockets

43 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included PB Fintech Ltd. (1,002.40, 10.24%), Ratnamani Metals & Tubes Ltd. (3,574.45, 10.13%) and Godfrey Phillips India Ltd. (2,459.95, 9.22%).

Top high volume losers on BSE were Kalyan Jewellers India Ltd. (350.20, -4.68%), Larsen & Toubro Ltd. (3,479.75, -4.23%) and Jyothy Labs Ltd. (515.15, -3.83%).

AstraZeneca Pharma India Ltd. (6,616.60, 4.21%) was trading at 10.9 times of weekly average. KEC International Ltd. (657.65, 4.60%) and VIP Industries Ltd. (538.65, -0.93%) were trading with volumes 10.6 and 9.4 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

70 stocks made 52 week highs, while 4 stocks were underachievers and hit their 52 week lows.

Stocks touching their year highs included - ACC Ltd. (2,544.30, 1.24%), AIA Engineering Ltd. (4,107.35, 5.73%) and Amara Raja Energy & Mobility Ltd. (889.05, 6.07%).

Stocks making new 52 weeks lows included - Navin Fluorine International Ltd. (3,417.50, 3.31%) and VIP Industries Ltd. (538.65, -0.93%).

23 stocks climbed above their 200 day SMA including Clean Science & Technology Ltd. (1,493.55, 6.33%) and Lakshmi Machine Works Ltd. (13,720.15, 5.28%). 8 stocks slipped below their 200 SMA including Craftsman Automation Ltd. (4,373.00, -3.15%) and Data Patterns (India) Ltd. (1,905.50, -2.47%).

 
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The Baseline
30 Jan 2024
By Bhavani Eswar

In a rare instance, India’s Prime Minister offered a stock market tip during a no-confidence motion in August 2023. Responding to opposition queries about loan write-offs by public sector lenders and LIC investments, PM Narendra Modi said, “There is a guru mantra for those interested in the share market – bet on stocks that the opposition raises concerns about.”

Investors following this advice did pretty well. The Nifty PSE, which has twenty public sector enterprise (PSE) stocks, saw a remarkable performance. By December 2023, the index delivered 40% returns and surged by 79% over the year, based on price appreciation alone. This excludes the hefty dividends typically paid out by PSEs. 

The trend has continued in 2024 so far, with the index rising 10.1% in January, according to Trendlyne’s share price history tool. In this edition of COTW, we look at the performance of the Nifty PSE index in 2023. 

While 2023 was a stellar year for the PSE index, 2022 saw a modest rise of 12.3%. A key driver of 2023’s sharp rally was bullish economic sentiment, thanks to the government’s push for infrastructure capex, defence indigenisation, and Make in India initiatives. The relativeundervaluation of PSE stocks compared to their private counterparts also attracted investors to these fundamentally strong companies, taking the share of PSEs in the country’s overall market capitalisation to afour-year high of 13.3% (42 lakh crore).

Defence and power-financing firms lead PSEs’ 2023 bull run 

In 2023, the best-performing PSE stocks were the two largest power-financing NBFCs, REC and Power Finance Corporation (PFC) – both delivered over 100% returns. They reported an average loan growth of 20% on the back of healthy demand in the infrastructure and power sectors. In Q2FY24, REC achieved its highest-ever quarterly profit, an increase of 38.7% YoY due to improvingasset quality and efficient cost management.

Meanwhile, India’s largest power generation company, NTPC rose by 69.7% in 2023, driven by strong order inflows amid growing power demand. Coal India also rose by 58.2%, helped by a surge in thermal power generation and higher e-auction premiums. According to Union Power Minister Nitin Gadkari, power demand in India is likely to cross 400 GW by 2030. 

Defence stocks like Hindustan Aeronautics (HAL) and Bharat Electronics (BEL) have become investor favourites due to the potential in the Indian defence manufacturing industry, as the government emphasizes domestic procurement and defence exports. In 2023, HAL and BEL delivered returns of 93.8% and 69.7%, respectively. HAL’s strong performance is attributed to its strong order book of over Rs 83,000 crore and UBS expects the firm to benefit from upcoming defence orders worth above Rs 5,00,000 crore in the industry over FY24-28.

Among the state-run oil firms, Indian Oil Corporation (IOC) rallied by 61.4% in 2023. Softer crude oil prices and the expansion of refinery and chemical projects fuelled this surge. Other oil companies like Bharat Petroleum and Oil and Natural Gas Corporation (ONGC) rose by 35.1% and 35.6%, respectively. ONGC aims to increase production to 50 million metric tonnes (mmt) from 40 mmt by FY28, driven by 23 ongoing projects with a total capex of Rs 60,000 crore.

GAIL and Power Grid Corporation are among the top-performing utility (electric and non-electric) stocks, rising by 58.1% and 41.8%, respectively. GAIL benefited from low valuations, improved demand for gas, and pipeline expansion. A stable dividend yield of around 4% and a high dividend payout ratio of 83.3% aided Power Grid’s surge. LIC, despite a modest share price increase of 5.3% in 2023, surpassedSBI to become the most-valued PSE. LIC was listed in 2021.

PSEs to continue paying hefty dividends 

Apart from the stellar price performance in 2023, PSEs are set to pay over Rs 50,000 crore in dividends to the government for the third consecutive year. The index has maintained a dividend yield of 3.1%, thanks to a consistent dividend policy and improved profitability. This resulted in nine out of the twelve companies considered in the analysis maintaining a dividend payout ratio of over 25%. However, power financer REC and insurance firm LIC were among those with lower divided payments, affected by mandatory capital requirements from regulatory bodies.

A key factor driving the prices of PSE stocks is the expectation of the current government’s return in the 2024 elections. Despite recent gains, the government is likely to miss its disinvestment targets for the fifth consecutive year, as it faces issues like procedural delays and political and employee opposition. However, the 2021 public sector enterprise policy, which ensures government majority ownership in strategic sectors, has piqued investor interest in PSE stocks.

Typically, PSE stocks are overlooked by investors due to their underperformance compared to private counterparts. The Nifty PSE index’s P/E is currently trading at a discount of 35.7% to its all-time high P/E of 15.4 recorded in 2017. The recent Offer For Sale (OFS) by the government to sell a 2.5% stake in NHPC received a good response from retail investors (subscribed 1.4x), reflecting the changing perception towards PSE stocks. This, along with the gains of 2023, indicates a  growing appreciation for the potential of PSE stocks.