Market Capsule 18th May'24 | A Strong Rebound
- samarwealth
- May 18, 2024
- 7 min read
PSU's Lead the Strong Comeback by the Indices
The Indian equity indices posted modest gains this week, showing resilience despite election uncertainties. The broader market outperformed the leading indices during this period. The domestic equity market saw gains in four out of five trading sessions, with the Nifty closing above the 22,450 mark.
Market experts suggest that the recent selling by foreign investors is due to a global shift towards China's more affordable markets, rather than concerns about India's elections. Analysts remain optimistic about India's long-term growth prospects. Union Home Minister Amit Shah reinforced this sentiment, viewing the current market weakness as a potential buying opportunity.
Shah emphasized that while the stock market shouldn't be directly linked to elections, a stable government typically supports better market performance. He predicted a market surge post-June 4th, following a projected victory for the BJP and its allies in the Lok Sabha elections. The seven-phase elections will conclude with the vote count on June 4th.
For the week ending Friday, May 17, 2024, the S&P BSE Sensex increased by 1,252.56 points, or 1.72%, closing at 73,917.03. The Nifty 50 index rose by 410.9 points, or 1.86%, ending at 22,466.10. The BSE Mid-Cap index surged by 4.42% to 42,841.10, while the BSE Small-Cap index jumped 4.83% to 47,591.67.
In the current week, the Public Sector Enterprises (PSE) sector outperformed the broader market, rising by 6.82%. Leading the rally were top-performing PSE stocks such as MOIL, IFCI, Engineers India, HUDCO, and IRCON. This surge occurred ahead of the election results announcement. There remains significant potential for PSU stocks to continue their upward momentum. Investors are closely monitoring these developments, anticipating further gains in the PSE sector as market confidence builds.
⭐Video Recommendation:
Charting the Pulse of Indices: A) Sector Wise Performance
This week, almost all Indian sectoral indices showed Stagnant Movement lead primarily by PSE and Reality. Nifty FMCG index Underperformed the other indices considerably. Nifty Auto and Infra index however stood strong and is likely to extend the gains and showing relative strength.
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
A) Nifty 500
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 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.
Blockbuster Results ⭐⭐⭐⭐⭐
Hindustan Aeronautics Ltd reports strong Q4 FY24 results: Revenue at Rs 14,769 crore, up 18%, with profit increasing by 51% year-on-year.
Texmaco Rail & Engineering Ltd reports strong Q4 FY24 results: Revenue at Rs 1,145 crore, up 37%, with profit increasing by 148% year-on-year.
Phoenix Mills Ltd reports strong Q4 FY24 results: Revenue at Rs 1,306 crore, up 79%, with profit increasing by 50% year-on-year.
IIFL Securities Ltd reports strong Q4 FY24 results: Revenue at Rs 686 crore, up 71%, with profit increasing by 108% year-on-year.
Good Results ⭐⭐⭐
Kopran Ltd reports strong Q4 FY24 results: Revenue at Rs 186 crore, up 25%, with profit increasing by 132% year-on-year.
Mankind Pharma Ltd reports strong Q4 FY24 results: Revenue at Rs 2,153 crore, up 15%, with profit increasing by 62% year-on-year.
Pitti Engineering Ltd reports strong Q4 FY24 results: Revenue at Rs 328 crore, up 32%, with profit increasing by 62% year-on-year.
Dixon Technologies (India) Ltd reports strong Q4 FY24 results: Revenue at Rs4,658 crore, up 52%, with profit increasing by 18% year-on-year.
HPL Electric & Power Ltd reports strong Q4 FY24 results: Revenue at Rs 424 crore, up 17%, with profit increasing by 22% year-on-year.
Medi Assist Healthcare Services Ltd reports strong Q4 FY24 results: Revenue at Rs 310 crore, up 25%, with profit increasing by 38% year-on-year.
Average Results ⭐
Shakti Pumps (INDIA) Ltd.
Shakti Pumps (India) Ltd specializes in the manufacturing of various types of pumps and motors. The company provides advanced water pumping solutions for a diverse range of applications, including irrigation, horticulture, domestic water supply, and commercial and industrial uses. Its brand, "Shakti," is highly regarded in both domestic and international markets.
Shakti EV Mobility, incorporated as a wholly-owned subsidiary in FY22, focuses on the manufacturing and sale of EV motors, charging stations, battery management systems, electric control panels, smart electric control panels, and VFDs. The SPIL Board has approved investments totaling Rs. 114.3 crores in Shakti EV Mobility over five years, with the current investment reaching Rs. 26.92 crores. Shakti EV has already served the two-wheeler and three-wheeler segments and is actively testing and developing additional products.
As of Q3 FY24, the company serves the domestic market through an extensive distribution network comprising over 500 dealers, more than 15,000 retailers, 400+ service centers, and 18 state-based marketing branches.
The company has a presence in over 118 countries across the Middle East, USA, Africa, Asia, and Europe. It operates dedicated subsidiaries in the UAE, USA, Australia, and Bangladesh, as well as a subsidiary in China to facilitate imports. In FY24, the company secured a contract worth USD 35.30 million from the Government of Uganda for supplying solar-powered water pumps. SPIL is also a part of the International Solar Alliance (ISA), which requires 270,000 solar pumps across 22 countries, 1 GW of solar rooftops across 11 countries, and 10 GW of solar mini-grids across 9 countries.
Financial Highlights:
Product Portfolio:
Concall Updates:
Seven good-looking charts for next week 1. Yuken INDIA Ltd.
2. HEG Ltd.
3. KFin Technology Ltd.
4. Max INDIA Ltd.
5. NBCC Ltd.
6. HBL Power Systems Ltd.
7. Bharti Hexacom Ltd.
Order Wins:
Power Grid Corporation of India has received a letter of intent to establish an inter-state transmission system for two projects within the Rajasthan Renewable Energy Zone, a state government agency focused on solar power. Link
Rail Vikas Nigam has secured a contract worth Rs 239 crore from Southern Railway. The project involves the implementation of an Automatic Block Signaling system between Jolarpettai Junction and Erode Junction in the Salem Division of Southern Railway. Link
Cochin Shipyard has secured a contract valued between Rs 500 and Rs 1,000 crore from a European client. The project entails the design and construction of a Hybrid Service Operation Vessel (Hybrid SOV), with an option to build two additional vessels. Link
Bonus Share Issue & Share Splits:
Bharat Dynamics Ltd has planned a stock split to be executed on May 24, 2024, which involves reducing the face value of its shares from ₹10 to ₹5. Link
Som Distilleries & Breweries Ltd has planned a stock split to be executed on May 24, 2024, which involves reducing the face value of its shares from ₹10 to ₹2. Link
Inox Wind Ltd has announced a fixed bonus with a record date set for May 24, 2024, to be issued in a 3:1 ratio. Link
Appointments & Resignations:
Colgate-Palmolive: The Board has approved the re-appointment of Mr. Mukul Deoras as a Non-Executive Director and Chairman of the Board for a term of five consecutive years. Link
Sagar Cements: The Board has re-appointed Dr. S. Anand Reddy as Managing Director and Shri S. Sreekanth Reddy as Joint Managing Director of the company for an additional period of three years, effective from October 31, 2024. Link
Balu Forge Industries: The Board has approved the appointment of Mr. Sadik Patel as Chief Operating Officer (COO) of the company, effective May 14, 2024. Link
Honeywell Automation: The Nomination and Remuneration Committee has approved the appointment of Mr. Girish Shastri as Director of Global Engineering Services, effective May 15, 2024. Link
Titagarh Railsystems: The Board has approved the re-appointment of Shri Anil Kumar Agarwal as Executive Director, designated as Deputy Managing Director & CEO (Freight Rail Systems), for a period of three years, effective May 29, 2024. Link
Agreement:
Infosys has announced a multi-year strategic collaboration with First Abu Dhabi Bank (FAB) to optimize and modernize FAB's IT infrastructure services. Link
Zydus Lifesciences Global FZE has secured an exclusive licensing and supply deal with MSN Laboratories for the distribution of Cabozantinib Tablets (a generic equivalent of CABOMETYX®) in the US market. Link
Cipla has finalized agreements to invest up to ₹26 crores additionally in Achira Labs Private Limited. Link
Eicher Motors Limited has established a Joint Venture with iTriangle Infotech to develop and deliver fleet management solutions for truck and bus customers operating in various applications Link
Other Important News:
SBI announced that it has become the first bank to become a Trading cum Clearing (TCM) Member at India International Bullion Exchange. India International Bullion Exchange (IIBX) is India’s first bullion exchange established in IFSC Gift City Link
Royal Orchid Hotels Ltd. has inaugurated 'The World', the largest All-Suite 5-Star Hotel in Gujarat, located in Surat. This premier hotel features luxurious suites, extensive banqueting facilities, a signature spa, and a distinctive 'Surati' concept restaurant. The establishment seeks to enhance the hospitality experience and cater to sophisticated international guests. Link
Devyani International Limited (DIL) and PVR INOX Limited have announced an extension of their association through a strategic partnership. They plan to jointly establish a company in India dedicated to developing and operating food courts within shopping malls across the country. Link
The Board of Directors of Siemens Limited has approved the proposal to demerge its Energy Business into a separate legal entity, Siemens Energy India Limited, which is currently a wholly-owned subsidiary of Siemens Limited. Link
HFCL has bolstered its presence in the defense sector by creating advanced electronic products for defense applications. 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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