Closing Bell: Nifty around 21,650, Sensex down 379 pts; pharma outperforms

Benchmark indices ended lower on January 2 with Nifty around 21,650. At close, the Sensex was down 379.46 points or 0.53 percent at 71,892.48, and the Nifty was down 76.10 points or 0.35 percent at 21,665.80.

We wrap up today's edition of the Moneycontrol live market blog, and will be back tomorrow morning with all the latest updates and alerts. Please visit https://www.moneycontrol.com/markets/global-indices/ for all the global market action.

Profit taking in banking, IT, auto and realty stocks took a toll on the markets, as expensive valuations prompted investors to pare their holdings. Besides, the ongoing conflict in the Red Sea has been making investors jittery as any flare up in violence could trigger upsurge in oil prices and weigh on the economy.

Markets traded volatile for yet another session and lost nearly half a percent, in continuation to the prevailing consolidation phase. The beginning was subdued and pressure in the banking, auto and IT majors was weighing on the sentiment however resilience in the pharma and energy majors capped the damage. Eventually, the Nifty index ended with a modest cut to close at 21,665.80 level. The broader indices also witnessed a choppy trend and finally closed with a marginal cut.

The underperformance of the banking majors is largely weighing on the sentiment amid consolidation and a decisive close above 21,800 in Nifty would prompt the next leg of the up move. Meanwhile, we feel it is prudent to prefer defensive viz. FMCG, pharma and stay selective in others.

The market extended yesterday’s last hour’s sell-off, taking negative cues from Asian peers due to weak Chinese manufacturing data and mounting tensions in the Red Sea, which has the potential to disrupt global trade and crude supplies. Ahead of the impending results season, investors are adopting a profit booking strategy. Auto stocks declined on below-expected volume numbers, while pharma stocks were the standout due to catch-up in the US economy.

A bearish candle has emerged on the daily Nifty chart, indicating a potential bearish trend in the near future. Sentiment is expected to stay bearish as long as it remains below 21750. Any upward movement toward 21750 could encounter selling pressure. However, a clear breakout above 21750 could shift sentiment in favor of the bulls. Support is established at 21500 on the lower end.

The Bank Nifty witnessed sustained bearish pressure throughout the trading day, leading to a close below the crucial support level of 48000. To resume the upward trend and regain positive momentum, the index needs to achieve a breakout above the resistance at 48300, targeting levels of 49000/50000. The immediate support for the index is positioned at 47600, coinciding with its 20-day moving average (20DMA). A decisive breach below this level could intensify the downward momentum.

Indian rupee ended lower at 83.31 per dollar versus previous close of 83.23.

: Benchmark indices ended lower on January 2 with Nifty around 21,650.

At close, the Sensex was down 379.46 points or 0.53 percent at 71,892.48, and the Nifty was down 76.10 points or 0.35 percent at 21,665.80. About 1691 shares advanced, 1631 shares declined, and 72 shares unchanged.

Top loser on the Nifty were Eicher Motors, M&M, UltraTech Cement, L&T and Kotak Mahindra Bank, while gainers were Coal India, Adani Ports, Sun Pharma, Divis Labs and Cipla.

Among sectors, pharma index up 2.5 percent, while auto, realty, capital goods, bank and Information Technology down 1 percent each.

BSE Midcap and Smallcap indices ended on a flat note.

-Buy rating, target at Rs 230 per share
-A potential turnaround story is unfolding
-Well positioned to win NLC's Talabira project
-Order intake will exceed Rs 60,000 crore in FY24 if NLC order closed before March
-Order intake may surge to Rs 1.8 lakh crore during FY24-26, 3x the orders in 3 years preceding FY24
-Non-power segment providing sustainable growth catalysts

Indian Rupee depreciated by 0.14% on weak domestic markets and a positive US Dollar. Surge in crude oil prices also weighed on Rupee. US Dollar rose on safe haven appeal amid geopolitical tensions in the Red Sea and the ongoing conflict in Middle East.

We expect Rupee to trade with a negative bias on weak domestic equities and a rise in US Dollar. Surge in crude oil prices may also weigh on the domestic currency. However, any FII outflows may support Rupee at lower levels. Traders may take cues from final manufacturing PMI and construction spending data from US. Traders may await manufacturing index data from India and ISM manufacturing PMI and JOLTS jobs data from US tomorrow. USDINR spot price is expected to trade in a range of Rs 83.10 to Rs 83.70.

Bank of India has introduced Fixed Deposit at rate of interest of 7.50% p.a. for its customers & general public (for Rs 2 crore & above to less than Rs 50 crore) under specific maturity period of 175 days with effect from 1st January, 2024.

-Buy call, target at Rs 150 per share
-It’s a top pick for 2024 as company is scaling new heights
-Expected to benefit from changing dynamics in its key markets
-Rising demand in key markets slower supply should propel growth
-Expect company to clock management fees of Rs 94 crore by FY26

In December 2023, Adani Ports and Special Economic Zone handled 35.65 MMT of cargo volumes, resulting in a strong 42% year-on-year (YoY) increase.

Dry bulk cargo handling was up 63% while handling of containers increased by over 28% on a YoY basis.

Transformers and Rectifiers India Limited has successfully FAT tested multiple numbers of 210 MVA, 420/√3/21 kV single phase generator transformers with indigenous technology to one of the prestigious client in India.

Supplied transformers will form three phase bank of 630 MVA at site and shall facilitate uninterrupted power flow.

Ramesh Birajdar - Vice President --- Corporate Finance would take over as Vice President and Chief Financial Officer & key managerial personnel of Kirloskar Pneumatic effective from January 2, after superannuation of Suhas S Kolhatkar as Vice President and Chief Financial Officer of the company.

Sensex Today | BSE Oil & Gas index up 0.6 percent led by ONGC, HPCL, BPCL:

Kaushalya Logistics IPO has been subscribed 73 times so far on January 2, the third day of bidding, as investors picked 26 crore shares against an offer size of 35.45 lakh shares.

Retail investors bought 120 times the portion set aside for them. High net-worth individuals (non-institutional investors) picked 91.89 times the reserved portion, and qualified institutional buyers bought 2.82 times the allotted quota.

The National Company Law Tribunal, Kolkata sanctioned the scheme of amalgamation amongst Tata Steel and The Tinplate Company of India and their respective shareholders.

South Indian Bank has announced 10.83% on-year growth in gross advances at Rs 77,713 crore for the quarter ended December FY24. In the same period, deposits increased by 9.37% on-year to Rs 99,164 crore, while CASA rose by 2.8% YoY to Rs 31,529 crore.

Sensex Today | Market at 2 PM

The Sensex was down 500.96 points or 0.69 percent at 71,770.98, and the Nifty was down 111.40 points or 0.51 percent at 21,630.50. About 1592 shares advanced, 1700 shares declined, and 78 shares unchanged.

Deposits up 19 percent at Rs 2.39 lakh crore versus Rs 2.01 lakh crore and advances up 18 percent at Rs 2.02 lakh crore versus Rs 1.71 lakh crore, YoY.

Religare Enterprises' subsidiary Care Health Insurance (CHIL) has received an order from the Principal Commissioner Central Goods & Service Tax & Central Excise Commissionerate Chandigarh, under the Central Goods and Services Tax Act, raising a tax demand of Rs 35.92 crore along with penalty of Rs 3.59 crore and applicable interest.

Airtel Africa plc has today announced the retirement of the Chief Executive Officer, Olusegun “Segun” Ogunsanya, with effect from 1 July, 2024.

The company also announced the appointment of Sunil Taldar as Managing Director and Chief Executive Officer to succeed Mr. Ogunsanya on his retirement.

The coal production in December 2023 increased by 8.2% YoY to 71.9 million tonnes and the same in the period of April-December 2023 grew by 11% to 531.9 million tonnes compared to year-ago period. The offtake rose by 6.1% on-year to 66.6 million tonnes during the month of December 2023, while the offtake in nine months period ended December 2023 grew by 8.7% to 552 million tonnes compared to corresponding period last year.

Relianc Industries has subscribed to 3300,00,00,000 9% non-convertible redeemable preference shares of Re 1 each of Alok Industries for cash at par, aggregating Rs 3,300 crore.

The Company is a promoter and holds 40.01% of equity share capital of Alok Industries.

Bharti Airtel's subsidiary Bharti Airtel Services has entered into an agreement for acquisition of 49,45,239 equity shares, representing 97.1% stake in another Bharti Group company, Beetel Teletech. Beetel Teletech also has 49% stake in joint venture having two manufacturing facilities which produce telecom and networking products including those qualifying for production linked incentive (PLI) scheme.

SRFhad incorporated SRF Altech, a wholly owned subsidiary, for setting up the manufacturing facility for manufacture of aluminium foil. The said facility has been commissioned and capitalised at a cost of Rs 536 crore.

Kay Cee Energy & Infra IPO received a strong response from investors on January 2, getting subscribed 591 times on the final day of bidding. The participants bought 127 crore shares against the offer size of 21.5 lakh shares.

Retail investors and high-networth individuals were at the forefront, buying 919 times the allotted quota and 842 times the portion set aside for them. Qualified institutional buyers picked 28 times the reserved portion.

-Buy call, target raised to Rs 1,593 from Rs 1,290 per share
-Margin to improve over 3-4 years with US launches, growth in India, EM & Europe
-US pipeline could help drive growth on current base
-Raise EPS estimate for FY24/25/26 by 8 percent/2 percent/14 percent

Sensex Today | Market at 1 PM

The Sensex was down 485.36 points or 0.67 percent at 71,786.58, and the Nifty was down 115.10 points or 0.53 percent at 21,626.80. About 1492 shares advanced, 1778 shares declined, and 80 shares unchanged.

OTP Bank has chosen Intellect Digital Core (IDC) core banking system by Intellect Global Consumer Banking (iGCB), the consumer banking arm of Intellect Design Arena Limited to power its banking experience.

Gujarat Alkalies and Chemicals has signed Memorandum of Understanding (MoU) with Vedanta for exploring various business opportunities in the areas of Caustic-Chlorine and other allied businesses.

Broking house expect GAIL to post a strong earnings recovery (expect EBITDA/PAT CAGR of 32%/28% over FY23-26E) across its business segments supported by stabilising global LNG supplies and improving price environment for its commodity businesses.

Moreover, its earnings quality would improve with an increase in EBITDA share from its core gas transmission business.

Valuation of 7.5x FY26E EV/EBITDA is reasonable given a discount to historical average of 8.4x, expectation of a strong earnings growth, improvement in RoE to 15.8% (versus only 9.5% in FY23) and a healthy dividend yield of ~3-4%.

Maintain a Buy rating on GAIL with a revised Price Target of Rs 190 (reflects rollover of valuation multiple to FY26 earnings estimate).

Nagpur-based Diffusion Engineers on January 1 filed a draft red herring prospectus (DRHP) with the capital markets regulator SEBI for raising funds through an initial public offering (IPO).

The IPO comprises only a fresh issue of 98.47 lakh equity shares by the company.

The engineering solutions provider will utilise net issue proceeds mainly on the expansion of its existing manufacturing facility in Nagpur's Khasra, at a cost of Rs 66.6 crore, and the setting up of new a manufacturing facility in Nagpur's Sonegaon for Rs 30.38 crore.

Sensex Today | BSE Smallcap index down 0.3 percent dragged by Andrew Yule and Company, TeamLease Services, Tourism Finance Corp of India:

The Department of Investment & Public Asset Management (DIPAM), Ministry of Finance, Government of India has agreed to the proposal of the Company & Ministry of Power to form four Joint Venture (JV) companies for the development of hydro & renewable projects in India & Nepal.

The company will form a JV with Maharashtra State Power Generation Company to develop 5,000 MW RE projects.

Another, JV will be between the company, Government of Arunachal Pradesh & Navyuga Engineering Company to execute the development of 1,878 MW Oju hydro electric project in Arunachal Pradesh. In the third JV, the company will be collaborating with Nepal Electricity Authority & GMR Energy for implementation of 900 MW Upper Karnali Hydro Electric Project in Nepal. Further, subsidiary SJVN Green Energy will be forming a JV with Assam Power Development Company, for developing 1,000 MW RE projects in Assam.

The total deposits grew by 10.6% YoY to Rs 14,310 crore and gross advances increased by 11.9% to Rs 10,347 crore in Q3FY24. Gold loan segment registered a 28.36% YoY growth at Rs 2,675 crore and CASA grew by 5.69% YoY to Rs 4,459 crore during the quarter.

Sensex Today | BSE Power index down 0.7 percent dragged by NTPC, ABB India, Suzlon Energy:

Surya Roshni's lighting and consumer durable business is debt free i.e. completely borrowing free segment as of December 2023. The segment has no long term and working capital borrowings as on date.

Sensex Today | Market at 12 PM

The Sensex was down 545.03 points or 0.75 percent at 71,726.91, and the Nifty was down 132.60 points or 0.61 percent at 21,609.30. About 1342 shares advanced, 1892 shares declined, and 87 shares unchanged.

Gensol Engineering has received approval from the Board of Directors for raising of funds up to Rs 300 crore through public issue, preferential allotment, private placement, including one or more qualified institutional placement of equity shares (QIP).

The board of Easy Trip Planners has given an in-principle nod to raise funds of up to Rs 1,000 crore through equity or debenture issuance on a preferential basis.

Shares of Alembic Pharma surged over 5 percent on January 2 after the company informed exchanges that it received various US Food & Drug Administration (USFDA) product approvals (tentative or final) during the quarter ended December 31, 2023. Alembic has a cumulative total of 196 ANDA approvals from USFDA which includes 170 final approvals and 26 tentative approvals, according to the regulatory filing.

Stock Market LIVE Updates | Nifty Pharma is the only sector trading in the green. Lupin biggest gainer

Lyold Metals recorded a 169 percent surge in iron ore production during the first nine months of FY24.

ENAM AMC sold 721,714 shares of Bajel Projects on January 1. Bajel Projects was demerged from Bajaj Electricals in 2023. As per the terms, shareholders has received 1 share of Bajel Projects for every 1 Bajaj Electricals share held.

The domestic equity benchmarks commenced Tuesday's session in the red, influenced by mixed global market cues and a notable occurrence of profit booking at higher levels.

Options interest (OI) data reveals that the call side has the highest OI at 22,000, followed by 21,800 strike prices. On the put side, the maximum OI is observed at the 21,700 strike price. Support for the Nifty50 index is anticipated to emerge at levels between 21,600 and 21,675, with a robust buy zone expected at 21,500-21,600.

Concerning Nifty Bank, support is predicted to be present at levels ranging from 47,925 to 48,075, with a strong buy zone identified in the 47,725-47,850 range

NMDC fixed prices of Lump Ore (65.5%, 6-40mm) at Rs 5,600 per ton and Fines (64%,-10mm) at Rs 4,910 per ton.

UltraTech Cement has recorded a 6% YoY (2% QoQ) growth in consolidated sales volume at 27.32 million tonnes, with India sales volume growing 5% YoY (2% QoQ) to 26.06 million tonnes.

Manobendra Ghoshal, the Chief Strategy Officer, has been relieved from RITES on January 1, 2024 to join as Chairman & Managing Director of MSTC, and thereby ceased to be among the senior management of the company.

Based on the representation made by Sheela Foam, The Joint Commissioner, Central GST Commissionerate, Noida, passed new order, saying dropped the majority of demands and confirmed a demand of Rs 3,25,100 plus interest and a penalty of Rs 32,510. Earlier in October, the company has received a Show Cause Cum Demand Notice from the Commissioner of GST Intelligence, alleging a tax demand of Rs 20.26 crore in addition with an equivalent penalty of Rs 20.26 crore and applicable interest on the said demand.

Shares of Coal India opened 1 percent higher on January 2, a day after the company disclosed that production in December grew 8.2 percent on-year to 71.9 million tonnes. At 9:20am, the stock was trading at Rs 385.40.

In a regulatory filing after the trading hour on January 1, Coal India said that coal production in December 2023 increased by 8.2 percent to 71.9 million tonnes. For the period of April-December 2023, production grew by 11 percent to 531.9 million tonnes compared to year-ago period ( April-December 2022). Additionally, the offtake rose 6.1 percent YoY to 66.6 million tonnes in December 2023, while the offtake in nine months ended December 2023 grew 8.7 percent to 552 million tonnes.

Foreign brokerage firm Jefferies has given a 'buy' call to the stock and raised the target price to Rs 450 from Rs 425. "Coal India's volume growth trajectory has improved and is likely to sustain amid India's strong economic growth outlook and rising power consumption," the report said. Read More

Shares of SRF Ltd saw a nearly 1 percent increase in early trade on January 2, following the commissioning of an aluminum foil manufacturing facility, SRF Altech Limited, at a cost of Rs 536 crore. At 9:35 am, the SRF stock was trading at Rs 2,484 apiece on the NSE.

SRF established a wholly-owned subsidiary named SRF Altech to build a manufacturing facility for producing aluminum foil. The company successfully commissioned this facility, which has now been capitalised at a cost of Rs 536 crore. This move represents SRF's strategic expansion into aluminum foil manufacturing. The subsidiary's setup and operational status align with SRF's broader initiatives for diversification and growth. Read More

Sensex Today | Nifty Metal index down 1 percent dragged by APL Apollo, SAIL, NALCO:

Veerhealth Care has received a preliminary sample export order worth $50,000 (Rs 41.50 lakh approximately) from one of the top institutional supplier companies in the United States of America. The company has been manufacturing and exporting various types of oral care products to East African countries and now it will be entering USA market which would open up other markets worldwide for the manufacturing and supply of oral care products.

APL Apollo Tubes has registered a sales volume of 6,03,659 tonnes in Q3FY24, down 0.2% compared to 6,05,049 tonnes in Q3FY23 and down 10.5% compared to sales of 6,74,761 tonnes in Q2FY24. The Q3FY24 sales volume declined QoQ due to channel de-stocking in anticipation of steel price correction.

Shares of Tata Motors extended their uptrend to the fifth straight session and rose 1.5 percent to hit a fresh lifetime high of Rs 804 on January 2. This was after the carmaker reported a 5 percent on-year rise in total sales in December.

Total sales in December came at 77,855 units, up from 74,356 sold a year back and also higher than CNBC-TV18 estimate of 75,233 units.

While sales of commercial vehicles were up 1 percent on-year to 34,180 units, those of passenger vehicles jumped 8 percent to 43,675 units in the months.

For the October-December quarter, total domestic sales were up 3 percent year-on-year. "The year-on-year growth trend witnessed during past quarters paused in Q3 FY24 on account of the higher base effect, impact of elections held across five states, and the post-festive season slowdown in rural consumption," Girish Wagh, executive director of Tata Motors stated in an exchange filing. Read More

-Buy rating, target at Rs 168 per share
-Reports suggest company has hiked platform fees to Rs 4 from Rs 3 in key markets
-Platform fee rise would partially offset impact of GST on delivery charge
-Company had also temporarily hiked the platform fee to Rs 9 on December 31

Sensex Today | Market at 10 AM

The Sensex was down 400.33 points or 0.55 percent at 71,871.61, and the Nifty was down 104.90 points or 0.48 percent at 21,637. About 1570 shares advanced, 1478 shares declined, and 103 shares unchanged.

Minda Corporation's subsidiary Minda Instruments has received an order from Additional Commissioner, Central Goods & Services Tax, Pune, confirming demand of GST amounting to Rs 67.82 crore (penalty of 100% of GST and applicable interest) for the period July 2017 to March 2021 on account of issue concerning classification of the goods under the relevant provisions of the CGST Act and similar provisions under IGST Act.

Sensex Today | Nifty Information Technology index down 0.4 percent dragged by HCL Technologies, Infosys, Tech Mahindra:

Life Insurance Corporation of India has increased its shareholding in Asian Paints by 48,652 equity shares, from 4.995% to 5.000% of the paid-up capital of the said company.

TVS Srichakra has received an order from the office of the Joint Commissioner of CGST & CE, Madurai with tax demand of Rs 9.94 crore along with interest and penalties.

Sensex Today | BSE Healthcare index up 1 percent supported by Alembic Pharma, Solara Active Pharma Sciences, Sequent Scientific:

The 1000 points rally in the Nifty in the last one month has imparted momentum to the market. Retail investors encouraged by the excellent returns of 2023 have turned exuberant and are chasing stocks, unmindful of the high valuations, particularly in the mid and small cap segments. Investors should not fall into the trap of ‘recency bias’ and chase low grade stocks in the broader market.

Declining dollar and US bond yields provide a favourable global context for equities. FII inflows in 2024 are likely to be huge and have the potential to lift high quality large-caps, particularly in segments like banking where valuations are fair.

An important trend to watch is the spike in the volatility index VIX to 14.5 which indicates that high volatility is round the corner. Yesterday’s sell off in the last 30 minutes is a warning that at higher levels there can be bouts of big selling.

Life Insurance Corporation of India has received demand order of Rs 806.3 crore for collection of GST along with interest and penalty for Maharashtra state, from the Deputy Commissioner of State Tax, Mumbai. The demand order cum penalty notice is for FY2017-18 including GST of Rs 365 crore and penalty of Rs 404.77 crore. There is no material impact on financials, operations or other activities of the Corporation.

The Royal Enfield sold 63,387 motorcycles in December 2023, down by 7% from 68,400 motorcycles in same month last year. Exports declined 29% to 6,096 motorcycles, from 8,579 units during the same period.

TVS Motor Company recorded monthly sales of 3,01,898 units in December 2023, with a growth of 25% as against 2,42,012 units in same month last year. The total exports grew by 8% year-on-year to 85,391 units in December 2023.

Kernex Microsystems;' joint venture company, VRRC-KERNEX-CE-RVR JV, has received order worth Rs 109.46 crore from South Central Railway for comprehensive signaling and telecommunication works for provision of automatic block signaling system.

Power Grid Corporation of India is declared as successful bidder to establish inter-state transmission system for evacuation of power from REZ in Rajasthan (20GW) under Phase-III Part D – Phase I, on build, own operate and transfer (BOOT) basis. The scope of the project comprises establishment of 765kV D/C transmission lines traversing in Rajasthan and Delhi alongwith associated bays extension works at existing substations located in Rajasthan and Delhi.

Indian indices opened on a flat note on January 2 with Nifty around 21,750.

The Sensex was down 119.39 points or 0.17 percent at 72,152.55, and the Nifty was down 21.90 points or 0.10 percent at 21,720. About 1661 shares advanced, 583 shares declined, and 98 shares unchanged.

Coal India, Tata Motors, Tata Consumer, Bharti Airtel and Nestle India were among major gainers on the Nifty, while losers were Eicher Motors, UltraTech Cement, Axis Bank, Infosys and Kotak Mahindra Bank.