The economic situation also looks promising with buoyed consumer sentiment and good macro-economic indicators. GST Collection, export numbers, PMI Data etc represents positive sentiment.
Inflation, follow-up demand scenario & FIIs selling are three concerns currently. Hence, it’s time to be selective and add quality stocks, as we believe corrections should be seen as a good opportunity to buy. Revival in economic activities, with strong fundamentals and expectation of interest rate cuts, would lead to positive momentum.
Coming to this week’s performance, the equity benchmark index declined for the fourth consecutive session, impacted by weak performance in the auto and FMCG sectors amid ongoing selling by FIIs. The mixed quarterly results and lackluster global cues further contributed to the downturn.
With this let me present to you our weekly market review.
How Did the Markets Fare Last Week?
On a weekly expiry basis that ended on Friday, which ended on Thursday, the Indian benchmark indices ended in red. Sensex and Nifty were down between 2.2 per cent -2.7 per cent , while Midcaps were down 5.2 per cent.
What Might Keep the Markets Busy Into the Next Week?
The markets continue to remain volatile as investors take cues from the ongoing Q2FY25 earnings and the management commentary setting the tone for H2FY25 and beyond.
Along with this, the overnight cues from the global markets will also be monitored as our markets react to them. The pace at which Foreign Institutional Investors (FIIs) are selling, which is the highest till now on a monthly basis, will be monitored very closely as it has a direct impact on the market breadth.
Apart from this, on the domestic front, we have data releases like FX Reserves, Money Supply, Federal Fiscal Deficit, Infrastructure Output etc.
On the global front, the IMF Meeting, the Housing Price Index, the very important GDP Growth, Core Personal Consumption, Initial Jobless Claims, etc., will keep investors busy.
Crude and FII Flows
Brent crude oil prices surged to above $75/bbl, though they are still in the middle of recent ranges.
On the other hand, FIIs continue to be net sellers for the week.
Sector in Focus
IT, PSU banks and energy remained in focus during the week.
The markets continue to remain volatile as investors take cues from the ongoing Q2FY25 earnings and the management commentary setting the tone for H2FY25 and beyond.
Stocks That Made Headlines During The Week
ITC:
Resilient performance coming in from ITC and if we compare some of the previous session, some of the FMCG stocks have either fallen too much or they have met expectations even as demand scenarios are subdued.
For ITC the revenue was beaten by strong performance in their agri business and also hotels. There was high inflation in leaf tobacco, FMCG inputs and paper business that weighted on margins but we see no problems on topline.
Coming to financials, revenue stood at Rs 19,300 crore vs consensus expectation of Rs 17,700 crore. The EBITDA was slightly below expectation as it stood at Rs 6,335 crore while the consensus estimates were of Rs 6,375 crore but the net profit meets expectation at Rs 5,080 crore vs expectation of Rs 5,050 crore.
Chalet Hotels:
The company announced its Q2FY25 results, reporting a record Q2 revenue. Total income in Q2FY25 stood at Rs 383 crore, reflecting a jump of 20 per cent YoY while Total EBITDA also grew by 20 per cent to Rs 155 crore while maintaining a stable margin of over 40 per cent , to be precise 40.6 per cent
The bottom line performance i.e. the Net Profit saw a de-growth due to a one-time non-cash impact of Rs 202 crore caused by changes in long-term capital gains indexation under the Finance Act, 2024. Hence, the Net Profit was negative Rs 138.5 crore.
Ashok Leyland:
Ashok Leyland’s subsidiary OHM Global Mobility has bagged an order for 500 12-m ultra-low floor electric buses from the Metropolitan Transport Corporation (MTC), Chennai.
OHM is Ashok Leyland’s electric mobility arm, focused on Mobility-as-a-Service business. This order will further strengthen Ashok Leyland’s dominant position in the bus segment and underscores its commitment to advancing sustainable urban mobility in India.
RITES:
RITES entered into a Memorandum of Agreement (MoA) with NMDC to provide comprehensive Project Management Consultancy services. This MoA marks a strategic collaboration aimed at developing, upgrading, and creating rail connectivity for NMDC’s mines and related facilities across locations.
Through this partnership, RITES will offer end-to-end Consultancy services from concept to commissioning, focusing on the reconnaissance survey, feasibility study, Detailed Project Report (DPR), and project management for rail connectivity projects.
Aurionpro:
Aurionpro announced another significant multi-million-dollar win, following its recent success in the Asian market. This new project entails delivering iCashpro+, comprehensive Transaction Banking Solution, for a leading bank across multiple countries in South Asia.
This is set to enhance the overall customer experience for the bank’s corporate clients, further solidifying Aurionpro’s leadership in providing innovative and robust digital banking platforms.
Privi Speciality Chemicals:
The company has registered its best ever quarterly performance, registering a 16 per cent revenue growth on YoY basis crossing Rs 500 crore mark for the first time.
Over the past six quarters, the performance has steadily improved, driven by steady demand, operational efficiencies and a better product mix, resulting in 20 per cent + margins. Net profit was up 48 per cent YoY to Rs 44.84 crore during Q2FY25.
GMR Airports:
Pax traffic increased to 19 mn, up by 7.6 per cent YoY from 17.7mn in Q2FY24. Domestic traffic increased by 5.8 per cent YoY while International traffic increased significantly by 12.7 per cent YoY in Q2FY25. In H1FY25 it reached 38.3 mn pax which was up 7.4 per cent YoY, witnessing highest ever half-yearly traffic in H1FY25.
NLC India:
NLC India has signed a Joint Venture Agreement with Rajasthan Rajya Vidyut Utpadan Nigam Limited (RVUNL) on 23rd October 2024 for setting up of 3×125 MW Lignite based Thermal Power Station in the Rajasthan State and to develop the Mines to meet the fuel requirement of the Thermal Power Station.
M&M:
M&M officially opened its doors to the Passive safety lab and Battery & Cell Research Lab, for its engineers to test the safety of SUV products at various load cases & perform research on Cell Technologies with an investment of over Rs 300 crore. The facility can perform with Bharat New car assessment program (BNCAP) along with Australian & European New Car Assessment Program (A/ENCAP).
Sona BLW:
Sona BLW Precision Forgings Ltd. (Sona Comstar), has entered into an agreement (Agreement) with Escorts Kubota Ltd. (EKL) to acquire the Railway Equipment Division of EKL (RED), as going concern, on slump sale basis, for an enterprise value of Rs 1,600 crore, subject to the terms of the Agreement.
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