Trendlyne Marketwatch    
02 Aug 2022
Market closes flat, Godrej Properties' Q1 profit up 168% YoY

Trendlyne Analysis

Nifty 50 closed flat, with the volatility index, India VIX, rising over 18.5%. European indices followed the global trend and traded lower than Monday’s levels. Major Asian indices closed in the red, led by the Chinese and Taiwanese stocks ahead of a possible visit by US House Speaker Nancy Pelosi to Taiwan, despite warnings from China. The White House national security spokesman John Kirby said that China may respond to Nancy Pelosi’s visit with military provocations. The US indices closed flat to lower on Monday. The tech-heavy index, NASDAQ 100, closed flat while the S&P 500 fell 0.3%. Brent crude oil futures, which lost about 7% in the last two trading sessions, traded lower over demand concerns.

Nifty Smallcap 100 and Nifty Midcap 100 closed higher, despite the benchmark index closing flat. Nifty Realty and Nifty Metal closed lower than Monday’s levels. Nifty IT closed in the red, taking cues from NASDAQ 100 futures, which is trading lower.

Nifty 50 closed at 17,294.85 (-45.2, -0.3%) , BSE Sensex closed at 58,136.36 (20.9, 0.0%) while the broader Nifty 500 closed at 14,836.60 (-10.3, -0.1%)

Market breadth is in the green. Of the 1,891 stocks traded today, 1,026 were on the uptrend, and 818 went down.

  • Medplus Health Services, Chalet Hotels, Cholamandalam Financial Holdings, and Infosys are trading with higher volumes as compared to Monday.

  • State Bank of India sees a long build-up in its August 25 future series as its open interest rises 7.1% with put to call ratio of 0.66.

  • Centre’s Ministry of Power eases the 10% mandatory coal import norms for blending purposes.
  • Adani Ports & Special Economic Zone’s cargo volumes in July rises 13% YoY to 31.23 million metric tonnes (MMT). From April 2022 to July 2022, the company handled 122.12 MMT of cargo, indicating a growth of 9% YoY.

  • All Public sector banks are trading in the green. Stocks like Bank of Baroda, Canara Bank, Punjab National Bank, Bank of India, among others are up by more than 3%. The broader sectoral index Nifty PSU Bank is also rising in trade.

  • Godrej Properties' Managing Director and Chief Executive Officer Mohit Malhotra resigns on Tuesday. His resignation is effective from December 31.

  • Utility stocks like Adani Transmission, JSW Energy, PTC India, and Reliance Power, among others, are rising in trade. The broader sectoral index S&P BSE Utilities is also trading in green.

  • HDFC Securities initiates coverage on Star Health and Allied Insurance with a ‘Buy’ rating and a target price of Rs 860. This indicates an upside of 15.1%. The brokerage is positive on the prospects of the company given its extensive distribution network, high customer stickiness, and large market share. It expects the company’s net profit to grow 82.7% in FY24 over FY23.

  • YES Bank rises in trade as HDFC Bank’s ex-MD Aditya Puri may get a seat on the bank's board, on behalf of PE Firm Carlyle, according to reports.

  • Godrej Properties is falling despite an increase in net profit by 168% YoY to Rs 45.5 crore in Q1FY23. The company’s revenue also rises 2.8X YoY as booking value surges (407%). However, the cost of raw materials shoots up 6X YoY because of high inflation.

  • Kansai Nerolac Paints is trading with more than 21 times its weekly average trading volume. Indigo Paints, Triveni Turbine, Venky's (India), and Lux Industries are trading at more than six times their weekly average trading volumes.

  • Castrol India is rising as its Q1FY23 net profit rises 47.3% YoY to Rs 206.3 crore. Profit grows as the company hikes prices to offset rising input costs. Revenue grows 39.6% YoY as sales volume improves. Price hikes and sales volume growth aid in margin expansion amid high input costs. Operating margin rises 84 bps YoY to 23%.

  • NielsenIQ says that India's FMCG industry has grown 10.9% in the June quarter for Q2 CY22. Urban markets contribute to positive volume growth compared to the rural markets. NielsenIQ's forecast indicates a 8-10% growth for this year.

  • Paint stocks like Kansai Nerolac Paints, Asian Paints, Indigo Paints among others rise as crude oil prices fall for the second consecutive session.

  • NMDC is falling as its July iron ore production declines 33% YoY to 2.05 million tonnes. Total production declines as iron ore production in Chhattisgarh drops 46% YoY. The company’s monthly sales also fall by 10% YoY to 2.95 million tonnes, mainly due to a 40.2% YoY decline in sales from its operations in Chhattisgarh.

  • Finance Minister Nirmala Sitharaman says there are no fears of recession or stagflation for the Indian economy, during the ongoing Parliament session, on Monday. She says the Centre is focused on curbing inflation.

  • Hero MotoCorp is falling as its total two-wheeler wholesales for July 2022 drops 1.9% YoY to 4.4 lakh units. Both motorcycle and scooter wholesales fell by 0.7% YoY and 19.7% YoY, respectively, which resulted in its July 2022 wholesales being lower than July 2021.

  • SpiceJet rises as it settles its outstanding principal dues with the Airport Authority of India (AAI). AAI will soon release a Rs 50-crore bank guarantee which will provide additional liquidity for the company. With this, the airline will now be paying in advance to AAI, instead of a ‘cash and carry’ process, for its daily flight operations.

  • Ashish Kacholia buys a 2.8% stake in Agarwal Industrial Corp worth Rs 18.8 crore and sells a 1.8% stake in Mastek worth Rs 116.1 crore on Monday, in bulk deals.

  • Zomato is rising despite reporting a loss of Rs 185.7 crore in Q1FY23. However, the company’s loss reduces on a YoY basis from Rs 356.2 crore last year. Even as revenue rises 67.4% YoY, a nearly 2X YoY surge in delivery charges dents the company’s margins. Revenue grows as the company’s gross order value rises 41.6% YoY driven by growth in order volumes and average order value.

  • UPL falls despite its Q1FY23 net profit rising 29.5% YoY to Rs 877 crore. Profits rose because of higher sales volumes and a favourable exchange rate. Revenue is up 27% with revenues from both agro and non-agro segments rising. However, raw material costs also increase 26% YoY affecting operating margins marginally, as it rises 3 bps YoY. The management expects demand to improve in the coming quarters. The company revises its FY23 revenue guidance to 12%-15%.

  • Metal stocks like Tata Steel, Steel Authority of India (SAIL), Jindal Steel & Power among others, are falling in trade. The broader Nifty Metal is also trading in the red.

  • ITC’s Q1FY23 net profit rises 34% YoY to Rs 4,389.7 crore as revenue increases 38.9%. Revenue grew across all segments with revenue from its cigarette segment growing 28.6% YoY and revenue from agri-business rising 82%. Revenue from agri-business grew because of an increase in wheat, rice and tobacco leaf exports. Hotel (334%) and paper and packaging segments (43.3%) also see decent growth. Demand for paper rose despite commodity prices rising as educational institutions open and Covid restrictions wane.

Riding High:

Largecap and midcap gainers today include Zomato Ltd. (55.55, 19.98%), Kansai Nerolac Paints Ltd. (508.30, 17.78%) and YES Bank Ltd. (17.15, 12.46%).

Downers:

Largecap and midcap losers today include GAIL (India) Ltd. (141.50, -3.94%), Indus Towers Ltd. (219.35, -3.67%) and UPL Ltd. (739.60, -3.62%).

Movers and Shakers

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

Top high volume gainers on BSE included Kansai Nerolac Paints Ltd. (508.30, 17.78%), YES Bank Ltd. (17.15, 12.46%) and Indigo Paints Ltd. (1,549.45, 10.07%).

Top high volume losers on BSE were Escorts Kubota Ltd. (1,633.45, -5.20%), Godrej Properties Ltd. (1,464.10, -3.18%) and Jubilant Pharmova Ltd. (361.00, -2.89%).

Triveni Turbine Ltd. (192.95, 6.63%) was trading at 13.5 times of weekly average. Star Cement Ltd. (88.80, 1.08%) and Lux Industries Ltd. (1,965.85, 6.83%) were trading with volumes 12.5 and 10.5 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

29 stocks hit their 52 week highs,

Stocks touching their year highs included - Adani Transmission Ltd. (3,421.45, 4.90%), AIA Engineering Ltd. (2,495.35, 0.84%) and Bank of Baroda (121.75, 4.69%).

32 stocks climbed above their 200 day SMA including Kansai Nerolac Paints Ltd. (508.30, 17.78%) and IRB Infrastructure Developers Ltd. (234.95, 7.70%). 11 stocks slipped below their 200 SMA including Escorts Kubota Ltd. (1,633.45, -5.20%) and Anupam Rasayan India Ltd. (795.55, -5.04%).

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