MARKET CAPSULE 16th March'24 | Small Caps in Trouble?
- samarwealth
- Mar 16, 2024
- 6 min read
Small Cap Indices Break Important Support Levels
The Small Cap Index has endured a notable downturn last week, with a fall of about 6% marking a correction of around 10% from the its peak highs earlier in the year. The Nifty Small cap 100 index, encountering a significant support zone between 15100 and 15300, concluded trading below this range at 14846. This closing figure represents the lowest in the past three months. Notably, the index's trend has shifted from forming higher highs and higher lows to now showing a pattern of lower highs and lower lows, indicating a bearish short-term outlook for small-cap stocks. The 100-day exponential moving average at 14870 has been serving as a critical support level. The upcoming week will be pivotal in determining whether this support holds or gives way. A potential weekly closure below the 14500 mark could signal a challenging period ahead for the Small cap index.
While the Indian Stock Market has faced a general downturn over the past week, this trend hasn’t been fully mirrored in the benchmark indices Nifty and Sensex. The Nifty closed the week at 22,023, down 2.09%, with significant declines in Nifty PSE, CPSE, and Realty sectors, around 9-10%. In contrast, the Nifty IT sector ended the week with gains.
Despite the market downturn, no fundamental shift has been observed. Looking ahead, sectors like FMCG and IT, are expected to outperform in the coming week. The coming week one needs to focus on the stocks showing higher relative strength as compared to its peers or market as a whole.
Charting the Pulse of Indices: A) Sector Wise Performance
This week, almost all Indian sectoral indices showed underperformance lead primarily by Public sector enterprise and Realty. Nifty IT index however stood strong and is likely to extend the gains with leading names like TCS, Wipro, Persistent System etc showing relative strength and strong resilience in a weak market followed closely by FMCG.
B) Heatmap
Heatmap helps investors quickly understand the performance of multiple stocks or sectors in a single view. Color coding, with varying shades indicating the degree of movement - red for declines, green for gains, and sometimes grey or other colors for little or no change. Heatmaps are effective for spotting market patterns and can be a time-saving resource in investment analysis.
C) Market Breadth
Analyzing market breadth is important as it provides insight into the underlying strength or weakness of the market, beyond just looking at benchmark indices. Breadth measures the percentage of securities in NIFTY 50 / NIFTY 500 surpassing specified moving averages over the specified period. Comparing the market breadth of nifty 500 during the previous week's trading sessions, we can analyze that number of stocks above key moving average support areas are reducing by the end of week. This can be considered as a sign of weakness if change is seen to be significant.
A) Nifty 500
Source: Stockedge
B) Nifty 50
Source: Stockedge
Time Technoplast Ltd. Time Technoplast Ltd.
Time Technoplast Ltd. is a prominent multinational corporation, renowned for its advanced technology-based polymer and composite products. With a significant presence across Asia and in 10 other countries, the company boasts a portfolio of over 14 distinguished brands. Catering to a broad network of more than 900 institutional customers worldwide, Time Technoplast counts industry giants like BASF, Huntsman, Bayer, Du Pont, Indian Oil, Gulf, ExxonMobil, Total, Ashok Leyland, Tata Motors, Cargill, GE, and L&T among its marquee clients. The company's commitment to innovation is evident in its robust in-house R&D team, consisting of about 30 experts with over 15 years of experience, dedicated to enhancing existing products and developing future-oriented solutions through cutting-edge processing technology.
Products offered:
Financial Highlights:
Future Outlook:
Five top gainers of this week
Seven good-looking charts for next week 1. PB Fintech Ltd.
2. Indo Count Industries Ltd.
3. Inox India Ltd.
4. Blue Star Ltd.
5. Azad Engineering Ltd.
6. Jyoti CNC Automation Ltd.
7. Salzer Electronics Ltd.
Top Deals of the Week: Standouts in Trade
Acquisitions:
NORGES BANK on account of the government pension fund global bought 1,57,82,629 shares of South Indian Bank at an average price of 29.35
NORGES BANK bought 21,84,806 shares of CMS info systems limited at an average price of 386.33.
Disposals:
Tobacco manufacturers India Limited sold 21,84,25,728 shares of ITC ltd at an average price of 400.25
Mrs. Utpal Aggarwal disposed 500,000 shares of Golkonda Aluminium extrusion Ltd. At an average of 17.00
Order Wins:
Rail Vikas Nigam Ltd has been identified as the Lowest Bidder (L1) by Central Railway for the "Signaling and Telecommunication work for provision of Automatic block signaling on Khapri-Sewagram Section of Nagpur Division." The total order value stands at Rs 47.4 crore. Link
Jupiter Wagons secures a contract worth Rs 957 crore from the Ministry of Railways for the manufacturing and supply of BOSM wagons. Link
GE Power India bags an order Rs 9.5 crore from The West Bengal Power Development Corporation Ltd. Link
H.G. Infra Engineering Ltd has been awarded a road project worth Rs 862 crore by the National Highways Authority of India (NHAI). Link⭐
KEC International Ltd has obtained fresh contracts totaling Rs 2,257 crores across its diverse business segments. Link⭐
The Ministry of Defense has finalized contracts worth ₹8073 crore with HAL for the procurement of 34 Advanced Light Helicopters (ALH) Dhruv Mk III for the Indian Army and Indian Coast Guard. Link⭐
Larsen & Toubro secures an order valued between ₹5,000 to ₹10,000 crore in the Middle East. Link
Bonus Share Issue & Share Splits:
OK Play India Ltd has planned a stock split to be executed on March 11, 2024, which involves reducing the face value of its shares from ₹10 to ₹1. Link
Waaree Renewables Technologies Ltd has planned a stock split to be executed on March 15, 2024, which involves reducing the face value of its shares from ₹10 to ₹2. Link
Gujarat Ambuja Exports Ltd has announced a fixed bonus with a record date set for March 15, 2024, to be issued in a 1:1 ratio. Link
M K Proteins Ltd has announced a fixed bonus with a record date set for March 15, 2024, to be issued in a 2:1 ratio. Link
Agreements:
Pitti Engineering Ltd has entered into an agreement with Bagadia Chaitra Industries Pvt Ltd (BCIPL) and its shareholders to purchase 100% of BCIPL's equity share capital at an Enterprise Valuation of Rs 124.92 crore. Link
Today, Shree Cement has finalized an Asset Purchase Agreement with M/s Starcrete LLP to acquire five Ready Mix Concrete Plants situated in the Mumbai Metropolitan Region of Maharashtra. Link
Reliance Industries: Paramount Global, through its two subsidiaries, has acquired Viacom 18 Media Pvt Ltd ("Viacom18") for a total sum of Rs 4,286 crore. Link
Azad Engineering has entered into a strategic agreement with GE Vernova's Steam Power business, securing a seven-year contract worth USD 35 million. The contract pertains to the supply of highly intricate rotating airfoils for use in the nuclear, industrial, and thermal power sectors. Link
Appointments & Resignations:
Tata Investment Corporation: The Board has endorsed the re-appointment of Mr. Ankan Mondal as Chief Risk Officer and has also sanctioned the appointment of Mrs. Savitha Narayanan as Chief Technology Officer of the company. Link
Stove Kraft: Mr. Navin Singhania, the Chief Technology Officer and a Senior Management Personnel of the company, has submitted his resignation citing personal reasons. Link
Fortis Healthcare: The Board has endorsed the appointment of Mr. Sanjay Baweja as the Chief Internal Audit and Risk Officer of the Company, effective from March 13, 2024. Link
Safari Industries: Mr. Manoj Patel has been appointed as General Manager - Information Technology of the Company with effect from 13th March 2024 and he will also be considered as Senior Management. Link
Other Important News:
Prime Minister Narendra Modi inaugurated the new T3 terminal at Lucknow's Chaudhary Charan Singh International Airport, built by Adani Enterprises at a cost of Rs 2,400 crore, with an annual capacity of 8 million passengers. Link
The Cabinet Committee on Security has approved 34 new Dhruv helicopters for the Indian Coast Guard and Army, manufactured by Hindustan Aeronautics Limited. Link
Shalby Ltd has revealed a strategic investment in Healers Hospital Pvt Ltd, acquiring a 100% equity stake for a total of Rs 104 crore. Link
Dr. Reddy's Laboratories Limited has been issued an order by the GST Authority for tax demand, including interest and penalty amounting to ₹67,47,37,495. The interest is calculated at applicable rates on the tax demand, and the penalty stands at ₹6,74,73,752. Link
Tata Motors Group has entered into a Memorandum of Understanding (MoU) with the Government of Tamil Nadu to consider establishing a vehicle manufacturing facility in the state. The MoU involves an investment of Rs 9,000 crores over a period of 5 years. Link
That's all for now! I hope you enjoyed the content. Do share your comments below! Disclaimer: Any stock or company discussed above should not be considered as a Buy/Sell recommendation. We personally or our clients might or might not have a position in any of the stocks discussed. This newsletter is purely is for educational purposes only.
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