The three day MPC meeting began on Monday and the decision will be announced on Wednesday by RBI Governor Shaktikanta Das.
Reliance Industries may report a muted performance for the April-June quarter of FY24, with most brokerages expecting it to have witnessed a year-on-year (YoY) and quarter-on-quarter (QoQ) contraction in revenue and net profit during the period because of a poor showing by its oil-to-chemicals (O2C) division. The O2C division, which includes refining and petrochemical businesses, accounts for a little over half of RIL's revenue and profit. A muted showing by RIL in the first quarter of 2023-24 may weigh on the overall corporate earnings, as well as the equity markets.
Mahindra & Mahindra (M&M) delivered a stronger-than-expected operational performance in the October-December quarter (Q3) of 2024-25 (FY25), driven by solid growth in its automotive (auto) and farm equipment segments. Higher volumes improved operating leverage, expanding margins.
After falling 17 per cent since the start of the year to its March lows, the stock of the country's largest pharmaceutical (pharma) company, Sun Pharmaceutical Industries, has clawed back nearly half of those losses. Recent acquisitions, a favourable court ruling in the case of the hair loss drug Leqselvi, an edge over peers owing to its specialty portfolio, and a diversified global presence have supported the recovery.
Dhananjay Sinha, co-head, institutional research, Emkay Global Financial Services tells Business Standard in an interview that even as global commodity prices have softened in response to expectations of weaker global demand, the stronger performance of equities is seemingly pre-empting stronger growth.
Among the 30 Sensex companies, Larsen & Toubro, Power Grid, NTPC, State Bank of India, Reliance Industries and HDFC Bank were the biggest laggards. Sun Pharma and Nestle were the only gainers.
Use the opportunity to increase equity exposure because these are short-term blips.
'Many do not have robust business models, and their prospects of survival and long-term growth are poor.'
Invest 10 per cent of investment portfolio in consumer-based, largecap stocks, say analysts.
It's not only the Indian markets that command a valuation premium over their global peers; shares of subsidiaries of India-listed multinational companies (MNCs) also trade at rich valuations compared to their parent companies. An analysis of 12-month forward price-to-earnings (P/E) and price-to-book (P/B) multiples of domestically listed MNCs shows that most quotes have a premium ranging from 2.1x to 6x that of their parent. Similarly, P/B, in most cases, is significantly higher in the domestic market.
A combination of factors, including heavy investments in US Treasury bonds and dollar sales at a healthy profit, facilitated the Indian central bank in transferring a record surplus of Rs 2.11 trillion to the government for 2023-24 (FY24). The RBI's dollar purchases increased in FY24, supported by robust capital inflows endorsing the economy's health.
International oil prices continue to be extremely volatile, falling on one day and rising thereafter, a top oil ministry official said explaining the reason behind no reduction in petrol and diesel prices despite softening in input cost, but could not say if the rates will be cut before Maharashtra elections. Global oil benchmark Brent crude futures fell below $70 per barrel last week -- the first time since December 2021 -- but gained thereafter. Brent was trading at $74.58 per barrel on Thursday while West Texas Intermediate advanced to trade at $71.71.
After a sharp fall in the share prices of HDFC Bank and other private sector lenders in the past three days, the BFSI (banking, financial services and insurance) sector weighting in the Nifty50 has slipped to a seven-year low of 32.03 per cent, down from nearly 36.6 per cent at the end of March 2023 and 34.5 per cent at the end of December 2023.
Tech Mahindra was the top gainer in the Sensex pack, rising over 2 per cent, followed by HCL Tech, Infosys, L&T, Tata Steel and ITC. NSE Nifty advanced 41.60 points to 15,853.95.
The decline is attributed to lower salary growth and a rise in households' financial liabilities.
Shares of Mukesh Ambani-owned Reliance Industries Limited (RIL) rose nearly 1 per cent on Tuesday, hitting an intraday high of Rs 2,986.05 per share, after most brokerages reacted positively to the company's March quarter (Q4FY24) results. The bullish outlook stems from Reliance Jio's potential tariff hikes, given the competitive landscape, along with slow but steady improvement in the oil-to-chemical (O2C) vertical.
Most global as well as domestic brokerages are upbeat on India's largest IT services provider, Tata Consultancy Services (TCS), despite its performance during the December quarter of FY25, when it missed Street estimates. On the bourses, the TCS share price rallied as much as 6.44 per cent to hit an intraday high of Rs 4,296.80 apiece, before settling 5.67 per cent higher at Rs 4,265.55.
Mumbai Metropolitan Region recorded housing sales of nearly 9,200 units in Q3 of calender 2020, against 3,620 units in the preceding quarter, registering a 1.5 times growth which is the highest growth seen any city except Chennai.
Analysts have given a thumbs up to the Reliance Industries (RIL) and Walt Disney Co. (Disney) proposed a joint venture (JV). The stock of the Mukesh Ambani-controlled company gained nearly 1.5 per cent on Thursday to Rs 2,952 levels as compared to the S&P BSE Sensex that traded marginally weak, down 0.2 per cent to 72,172 levels in intra-day trades.
Investors shunned shares of oil marketing companies (OMCs) on Friday as they feared that the government's decision to cut retail prices of petrol and diesel could hurt the companies' profit margins in the near term. On Thursday, the government announced that OMCs will reduce pump prices of petrol and diesel after a record 22 months, making them cheaper by Rs 2 per litre in the national capital. The changes were effective from Friday.
India's most valued company, Reliance Industries Ltd (RIL), reported a robust performance in the third quarter of the current financial year (Q3FY25), surpassing analyst expectations. This coupled with positive commentary by brokerages led to the stock of the oil-to-telecom conglomerate surging as much as 4.44 per cent to hit an intraday high of Rs 1,325.1. It settled at Rs 1,301.3 apiece, up 2.57 per cent.
The S&P BSE Sensex and the Nifty50 have hit record highs amid the poll outcome-triggered bull frenzy at the bourses. Most analysts feel that the indices are on course to rise further over the next few months - till the general elections - albeit amid intermittent corrections - largely triggered by global developments. Bharatiya Janata Party's (BJP's) win in the three state elections of Madhya Pradesh (MP), Rajasthan and Chhattisgarh, analysts at Jefferies believe, reinforces the consensus expectations of a Modi win 2024 national elections with a greater likelihood of over 300 seats for the BJP.
Even though Bharat Forge's performance in the July-September quarter broadly met Street estimates and defence orders are on the rise, the subdued outlook for its global business has prompted some brokerages to adopt a cautious stance on the company. Analysts have reduced the company's earnings per share (EPS) estimates to account for the slow recovery of its overseas subsidiaries. Valuations are also trading at long-term averages, which could limit potential upsides.
Other gainers included Nestle India, Asian Paints, Bajaj Finance, NTPC, L&T, Axis Bank and Bajaj Auto. On the other hand, TCS, ONGC, Infosys, HDFC and SBI were among the laggards. NSE Nifty surged 121.65 points or 1.03 per cent to 11,889.40.
Most markets have seen significant erosion in investors' wealth this year
Top losers in the Sensex pack included Tata Steel, Vedanta, Maruti, SBI, Coal India, Tata Motors, Sun Pharma, HUL, RIL, IndusInd Bank, Axis Bank, HDFC duo, ICICI Bank, M&M, Kotak Bank, and Infosys, falling up to 2.89 per cent.
Beauty and Personal Care (BPC) e-retailer Honasa Consumer's initial public offering (IPO) has failed to find backing from analysts due to the company's weak financial track record and expensive valuation. T Manish, research analyst at Samco Securities suggests avoiding the IPO as the company's financial performance does not inspire confidence. "The profit has been inconsistent and advertising and marketing expenses are incredibly high at around 40 per cent of the revenues.
The rally in PSBs, analysts feel, was more a knee-jerk reaction to the development, and the actual benefits will start to accrue once the addition takes place in 2024. "The actual benefit for banks from the inclusion in JP Morgan's EM Index will accrue from June 2024 onwards. "Until then, the larger fundamentals of the market will dictate the moves. "Once the initial euphoria subsides, bond markets will look to global cues which may trigger fresh selling," said Siddharth Khemka, head of retail research, Motilal Oswal Financial Services.
'Favourable product mix, sales recovery, and cost saving initiatives are expected to support margins going ahead while focus on debt reduction (target of debt free by FY24) will aid balance sheet strength'
The broader NSE Nifty fell 78.75 points, or 0.70 per cent, to close at 11,234.55.
Pessimism largely emanates from the fact that the volume outlook for FY20 isn't encouraging at the moment.
Benchmark indices bounced back on Wednesday after falling for five straight sessions, with investors snapping up the recently-mauled IT, finance and consumption stocks amid a supportive trend overseas. A rebounding rupee further bolstered sentiment, traders said. Halting its five-session slide, the BSE Sensex jumped 574.35 points or 1.02 per cent to finish at 57,037.50. Similarly, the NSE Nifty surged 177.90 points or 1.05 per cent to 17,136.55.
Most analysts have downgraded the stock of SBI Cards and Payments (SBI Card) as the credit card issuer posted weak results during the December quarter (Q3) of financial year 2023-24 (FY24). The sub-par show, analysts said, was for the eighth straight quarter. With this, they have slashed their earnings estimates by as much as 20 per cent over FY24-26 amid near-term pressure points in the company's growth outlook.
World trade has been growing slower than world GDP since 2012.
Inflation print for food articles, as a basket, remained nearly flat at 7.47 per cent during the month.
Trading in the equity market will largely depend on two major events this week - general elections result and the RBI interest rate decision - analysts said, adding that the benchmark indices may rally on Monday on exit polls' prediction of a massive win for the BJP-led NDA and strong GDP data. Exit polls on Saturday predicted that Prime Minister Narendra Modi will retain power for a third straight term, with the NDA expected to win a big majority in the polls. Counting of votes will take place on June 4.
'Younger investors start their journey with very little capital so they are risking less while they have a lot of time to experiment and learn early on.'
Growing concerns over slower-than-expected margin recovery, amid weak deposit growth have caught HDFC Bank's investors off guard. HDFC Bank's stock on Wednesday plunged nearly 9 per cent to hit an intraday low of Rs 1,527 on the BSE after reporting weaker-than-expected earnings in the third quarter (October - December) of the current financial year (Q3FY24). The shares of India's biggest private lender closed at Rs 1,536.9, down 8.46 per cent.
'Investors should keep them on their radar and invest over a longer time frame, and expect some of these companies to bite the dust.'
Notwithstanding robust volume growth and a strong performance from Jaguar Land Rover (JLR), Tata Motors, the country's second-largest automobile (auto) manufacturer by market capitalisation, disappointed the Street with its January-March quarter (Q4) results for 2023-24 (FY24). While consolidated revenues saw a 13 per cent increase, lower-than-expected realisations in the Indian operations weighed down overall performance.
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