After outperforming the broader market and their public sector peers for the better part of the post-Lehman period, private sector banks - such as HDFC Bank, ICICI Bank, Axis Bank, and Kotak Mahindra Bank - are now underperforming. Last week, the Nifty Private Bank index was up just 6 per cent year-to-date in the calendar year 2021, against nearly 13 per cent rally in the Bank Nifty and a 15 per cent rise in the benchmark Nifty50. Public sector (PSU) banks, such as State bank of India, Bank of Baroda, and Punjab National Bank, are now rally leaders and outperforming the broader market. The Nifty PSU Bank index was up 42 per cent since the beginning of this calendar year. But on a longer term, the Nifty Private Bank index is up 101 per cent since March 2016, against a 118 per cent rally in the Bank Nifty and just 2 per cent rise in the Nifty PSU Bank index in the period.
Sanjiv Mehta, chairman of the country's largest consumer goods company, HUL, believes that the second wave of the Covid-19 pandemic between April and June this year has been a mere pause in India's consumption story, and that it will not change the country's overall growth trajectory. India is poised for growth, especially in the fast-moving consumer goods (FMCG) sector, Mehta told shareholders at the company's annual general meeting on Tuesday. The signs of recovery are becoming evident with many states lifting lockdown restrictions in recent weeks.
'The concern that the bad bank may create a moral hazard for the system is extremely valid.'
Ramping up e-commerce operations and going beyond its current strongholds are key challenges for the grocery chain in its battle with Mukesh Ambani's retail behemoth.
India's top IT companies have shown a hiatus between their performance on the bourses in the pandemic period and earnings growth. The combined market cap of the top five IT companies - Tata Consultancy Services, Infosys, Wipro, HCL Technologies, and Tech Mahindra - is up 87 per cent since the end of March 2020. In comparison, the benchmark BSE Sensex is up 68 per cent during the period. So the industry beat the broader market by a big margin in the last one year.
'At this moment, investors should look for relative value within sectors and clear visibility (third-wave-or-not) on earnings delivery.'
Colgate-Palmolive India is placing greater emphasis on freshness, whitening, therapeutic, and family toothpastes, as rivals such as Dabur and Patanjali dominate the growing naturals segment of the market. Once under 5 per cent of the Rs 10,000-crore domestic toothpaste market, the naturals segment, which includes ayurvedic and herbal variants, is now 25-30 per cent of the market, industry executives said. Growth rates of the naturals segment are estimated to be in the region of 8-9 per cent in volume terms. In value terms, the growth rate for naturals is around 10-12 per cent, sector experts said.
With slippages increasing every quarter, any derailment on growth or change in customers' repayment behaviour after moratorium may impact the overall asset quality. Correction, though, presents attractive buying opportunities, given the bank's sustained leadership position.
The current up move, according to analysts, closely resembles the rally post the global financial crisis in 2008-09, not just in quantum and speed, but also the way small-and mid-cap indices outperformed large-cap peers.
The primary market is set for a bumper Rs 80,000-crore bonanza with 30 companies already filing IPO papers to raise Rs 55,000 crore, while around 10 more are lined up for this month itself, seeking to mop up another Rs 25,000 crore, say investment bankers. The market has been on a non-stop rally, hitting new records almost every week, on the back of an influx of investors -- a vast majority of them first-timers -- coupled with a flood of liquidity. Foreign funds alone had pumped in a record $35 billion into the market in FY21, while the trend has continued this fiscal as well. Domestic institutions led by LIC have also infused trillions of rupees, helping woo retail investors in troves -- the year saw over 20 million new investors coming to the market.
When, recently, Bharti Airtel announced a Rs 21,000 crore rights issue, analysts pointed out that its structure was similar to that of Reliance's issue in June 2020. One similarity is that shareholders in both companies have to pay only 25 per cent of the money on application. The rest is to be paid in two tranches. In Bharti Airtel's case, it is within 36 months; in Reliance Jio's, it is within 17 months.
Assuming that the value of LIC's holding has risen in line with the markets, its portfolio size today could be around $86 billion, higher than the previous record of $84 billion in March 2018.
The new PN3 norms and lack of clarity on what constitutes beneficial ownership are the primary reasons for the decline in investments from China and Hong Kong.
Among the key concerns of the Street is market share losses in growth segments, led by higher competitive pressures.
Experts said banking is a play on the economy and the latest buying into this space is underpinned by hopes of a sharper-than-expected recovery in the economy.
This is first time in 25 years that a benchmark equity index in India is trading at a P/E multiple of 40x or higher.
'In the short term, we may see some disruptions due to Covid, but in the medium-to-long term, we should keep an eye on US inflation and 10-year bond yields.'
At the end of Monday's trading session, the market capitalisation of BSE-listed companies stood at Rs 1,51,86,312.05 crore against Rs 1,46,58,709.68 crore on Friday.
Analysts attribute the surge to a host of factors, particularly the interest shown by the retail investors in these two market segments.
The earnings are, however, expected to be down around 2 per cent on a sequential basis due to pent-up demand getting exhausted and the adverse impact of rising metals and energy prices on consumer goods and manufacturing companies.
Real estate experts say rentals have corrected by 5-10 per cent across formats, including office, retail and housing, with a pick-up expected over the next few quarters as the economy recovers.
After Maharashtra, analysts expect more states like Karnataka and Haryana to slash stamp duty rates. However, analysts, do caution that it's still a long road to recovery for the realty sector.
This year, the combined net profit of 24 index companies, which have declared their June-20 numbers, has declined by 37 per cent year on year, while their revenues, including other income, is down by 21 per cent YoY so far.
The combined profit before tax of 748 companies, which have declared their results for Q1FY21, is down 46 per cent YoY. Their net sales went down by a quarter as the Covid-19 lockdown led to a sharp fall in economic activity.
Sebi penalised Shruti Vishal Vora - found guilty of leaking price sensitive information related to financial results of Wipro, Asian Paints and Mindtree, and Parthiv Dalal for similar action in case of Wipro earnings.
Foreing investors have high hopes from India due to an uptick in the economy
While seven companies bagged orders worth Rs 42,000 crore, industry experts said most of this new order activity was a spillover, and fresh project finalisation remains weak.
Chandra, who will turn 69 years old on Saturday, becomes non-executive director with immediate effect.
While a coordinated aggressive monetary easing from the central banks is most likely to offer some respite in the near-term, it is unlikely to improve the sentiments.
In three of the past four years, 10-year returns have been 10 per cent or lower, making equity unattractive, compared to other asset classes.
Within rural markets, the viewership share of Dangal TV, which is a free-to-air channel, is at 33%.
In the year to date, 61 PSUs have lost an average of 22 per cent, with five companies losing more than half their share value. The BSE PSU index is down 10.6 per cent.
Though a weak dollar will lend some support to revenues and margins in FY21, the demand environment will outweigh any gain.
Accenture -- considered as one of the top-most employers in India among the global technology services companies -- is believed to have over 150,000 workers in India, next to IBM.
Given the developments, analysts expect fiscal and monetary support from the government and RBI to revive sentiment. However, recovery, they say, from these levels will be slow and painful.
What stocks will gain from a normal monsoon?
The COVID-19 pandemic has not only affected outpatient services, but also led to deferment of elective surgeries, and resulted in the loss of medical tourism, all of which would hit the FY21 financials.
The global COVID-19 situation, rollout of vaccines, geopolitical trends, Union Budget and economic recovery would be the major factors driving investor sentiments in 2021 after a tumultuous year which saw both 'the worst of times and the best of times' for the stock market, said analysts. What a year 2020 turned out to be! From witnessing gigantic losses to record-shattering gains, investors went on a roller-coaster ride amid the coronavirus pandemic and massive stimulus measures. Markets closed 2020 with remarkable gains of around 16 per cent, but will the winning ways continue in 2021 as well?
Puneet Wadhwa and Debashish Pachal locate real estate stocks to watch out for.
The social impact of this could be worse as 300 million subscribers may face the annoyance of network shutdown and churn.
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