Closing Bell: Nifty above 21,600, Sensex up 272 pts led by IT, metal, pharma

Indian benchmark indices ended on positive note for the third consecutive session on January 10. At close, the Sensex was up 271.50 points or 0.38 percent at 71,657.71, and the Nifty was up 73.90 points or 0.34 percent at 21,618.70.

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.

Markets were extremely volatile but ended higher on selective buying in late trades as investors await the US inflation data on Thursday, which will provide some hint on Fed's interest rate decision going ahead. Helping positive sentiments were improving European stock markets in the backdrop of negative US Treasury bond yields which were seen weighing on the US Dollar. From a technical perspective, Nifty’s aggressive upside targets are still seen at the psychological 22000 mark, with confirmation of strength only above the 21836 mark.

The weakness in global indices continued to weigh down the domestic indices with every up move. The market is looking for fresh triggers for a direction, and the release of US and Indian inflation data may provide a near-term direction in the market. The investor's focus will be shifted to the earnings season, on a sequential basis, the earnings growth is likely to be lower, while the expectations for auto, capital goods, and cement will remain strong.

Markets traded volatile for yet another session and ended marginally higher amid mixed cues. After the flat start, Nifty hovered in a narrow range for most of the session however buying in select heavyweights aided recovery in the final hour. Eventually, it settled at 21618.70; up by 0.34%. Meanwhile, a mixed trend on the sectoral front kept the participants occupied wherein metal, IT and media were among the top performers. The broader indices also traded in tandem wherein midcap managed to edge higher.

We are seeing a balancing act by select heavyweights amid the mixed trend in banking and IT majors. And, indications are in the favor of prevailing consolidation to continue in the index thus participants should maintain their focus on stock selection and risk management.

The Nifty index bounced back strongly from its important support at 21,500, indicating that the bulls are quite active at this level. The Nifty closed at 21,623, near its resistance. If it manages to close above 21,700-21,750 levels, we might see the Nifty reaching 22,000.

For those looking to buy Nifty, the recommended range is between 21,550-21,600. Set a stop loss at 21,480 and aim for a target of 21,750.

The Bank Nifty index experienced a volatile trading session on the day of weekly expiry, but the bulls successfully defended the crucial support level of 47000. Despite this, the overall market sentiment remains in "sell on rise" mode. The immediate hurdle for the index is at 47500, where the highest open interest is concentrated on the call side. To initiate a short-covering move and potentially target the 48000 mark, the index needs to convincingly surpass the level of 47500 on a closing basis.

The Nifty witnessed yet another volatile day of trade today. It witnessed wild swings in both directions however, the Bulls managed to defend support zone and the Nifty closed in the green up ~80 points. On the daily charts we can observe that the Nifty has held on to the support zone of 21500 – 21460 where support in the form a Fibonacci retracement level and the crucial 20-day moving average (21489) was placed.

Buying interest has emerged from crucial support zone and the hourly momentum indicator has triggered a positive crossover which is a buy signal. Thus, both price and momentum indicator are suggesting continuation of the positive momentum. On the upside initial hurdle is placed at 21730 – 21750 while immediate support is placed at 21520 – 21500.

Bank Nifty witnessed a gap down opening however it lacked follow through selling pressure. In fact it witnessed buying interest from the support zone 46900 – 47000 and closed in the green. We expect the Bank Nifty to continue with the positive momentum going ahead. Initial hurdle is placed at 47550 – 47680 while support zone is placed at 47100 – 47000.

Rupee experienced volatility, ranging between 83.18 (on the weaker side at the opening) and 82.95 (on the higher side after an initial dip below 83.15). The rupee gained 0.10, with buyers becoming more assertive within the range-bound movements.

The overall trend remains sideways, and rupee movements are influenced by range-bound volatility. The upcoming US CPI data, scheduled for tomorrow evening, is expected to play a crucial role in determining the trend of the US dollar, with potential effects on the rupee as well.

For most of the time, the Index remained in the range of 21,470-21,560, and in the last hour of trade, a sudden rise in heavyweight stocks helped the Index to settle the day at 21,618.70 with gains of 73.85 points.

Among the sectors, Media was the top performer of the day by ending the session with gain of 3.47% while FMCG was the major laggard. Buying traction was witnessed in the Metal and IT stocks as well.

By retesting its dual support of 21,470 as well as 21DMA, the Index has formed a piercing candlestick pattern which is bullish and indicates a resumption of the current uptrend. A zone of 21,430-21,470 will act as a strong support while the immediate resistance comes at 21,725-21,750.

Indian rupee ended higher at 83.04 per dollar versus previous close of 83.11.

: Indian benchmark indices ended on positive note for the third consecutive session on January 10.

At close, the Sensex was up 271.50 points or 0.38 percent at 71,657.71, and the Nifty was up 73.90 points or 0.34 percent at 21,618.70. About 1772 shares advanced, 1495 shares declined, and 75 shares unchanged.

Top gainers on the Nifty included Cipla, Reliance Industries, Adani Enterprises, HCL Technologies and Adani Ports, while losers were ONGC, Divis Labs, BPCL, NTPC and Power Grid Corporation.

Among sectors, Healthcare, Information Technology and Metal up 0.4 percent each, while Oil & Gas index down 0.5 percent.

BSE Midcap and Smallcap indices ended marginally higher.

-Buy call, target raised to Rs 955 per share
-Europe, UK and China led significant growth in volumes in Q3
-JLR volume jumped 27 percent YoY in Q3FY24
-JLR product mix improved QoQ, which should lead to higher EBIT margin
-Company raised JLR EBIT margin guidance to 8 percent from 6 percent for FY24
-Company expects EBIT margin to reach 10 percent by FY26
-JLR expects to reduce net debt to £1 billion by the end of FY24 & turn to net cash by FY25-end

The current Budget is a vote of account so expecting any major announcement ahead of the forthcoming general elections seems highly unlikely. But taxpayers expect some populist announcements like increase in the basic exemption & house rent allowance exemption under both regimes. Income Tax structure has remained more or less the same, but the number of tax return filed has gone up significantly. By exempting the lower income group from income tax will reduce the work for the govt. machinery and in turn they can focus on greater compliance in the higher income group.

Expecting income tax cuts looks difficult due to the fiscal constraints. Enhancements of limits under Section 80C and 80D is possible due to adjustment for inflation rate. Government also indicate steps being proposed to take the glide path towards 4% fiscal deficit to GDP ratio. From the equity market point of view seems that it will be a non-event.

Sensex Today | Nifty Media index up 3 percent led by Network 18 Media & Investments, TV18 Broadcast, Dish TV

Sensex Today | BSE Healthcare index up 0.4 percent led by AstraZeneca Pharma, Gujarat Themis Biosyn, GlaxoSmithKline Pharmaceuticals:

-Individual APE increased by 9 percent YoY for the industry and 11 percent YoY for private insurers
-In individual APE, SBI Life reported robust growth
-Growth recovered for ICICI Prudential but HDFC Life reported a decline
-Industry’s individual APE growth was supported by a rise in ticket size
-The number of policies declined 3.8 percent YoY

Indian Rupee appreciated by 0.12% on recovery in the domestic markets and a soft US Dollar. A slight decline in crude oil prices also supported Rupee. World Bank retained India’s growth rate projection for FY24 and FY25 to 6.3% and 6.4% respectively.

The US dollar gained on Tuesday on easing expectations of a rate cut by the Fed in March 2024. The odds of a rate cut in March 2024 fell to 38% from 89% last week. Asian markets closed in the Red tracking decline in European and US markets on Tuesday after the World Bank projected global growth to slow down to 2.4% in 2024 from 2.6% in 2023.

We expect the Rupee to trade with a slight negative bias on risk aversion in the global markets amid the global economic slowdown and the ongoing geopolitical tensions in the Red Sea and Middle East. However, FII inflows and any weakness in the US Dollar may support the Rupee at lower levels. Investors may remain cautious ahead of inflation data from India and the US later this week. USDINR spot price is expected to trade in a range of Rs 82.70 to Rs 83.40.

-Buy call, target Rs 730 per share
-Media reports suggest company set to acquire part of Mancozeb portfolio of Corteva
-Deal terms for the acquisition of Mancozeb portfolio undisclosed
-Acquisition is small but positive development
-Acquisition will enable company to strengthen market positioning in key markets, especially LATAM
-Stock currently trades at an EV to EBITDA (FY25) of 5.5x

Sensex Today | Market at 3 PM

The Sensex was up 254.30 points or 0.36 percent at 71,640.51, and the Nifty was up 66.50 points or 0.31 percent at 21,611.30. About 1546 shares advanced, 1711 shares declined, and 77 shares unchanged.

Jyoti CNC Automation Ltd (JCAL) is one of the leading CNC machine manufacturing companies globally as well as in India with presence across the CNC metal cutting machinery value chain with well diversified global customer base spread across end user industries and focus on technology and ability to deliver innovative solutions bolstered by dedicated R&D facilities with vertically integrated operations which enables customization and production efficiencies.

At the upper price band company is valuing at P/E of 472.9x, EV/EBITDA 75.5x with a market cap of Rs 75,274 mn post issue of equity shares and return on net worth of 18.35%. Since company is using majority of its IPO proceeds to repay its debt which is going to reduce interest cost and hence it will have positive impact of profitability going
forward.

Apart from that there is revenue visibility for company due to its order book size and company operates under niche segment and majority of the revenue is from aerospace and defense industry which is high growth sector, believe that the IPO is fairly priced and recommend a “Subscribe for Long term” rating to the IPO.

-Buy call, target raised to Rs 450 per share
-Believe company will outperform
-Company will outperform as coastal Gujarat Power, even under section 11, continues to break
-Coastal Gujarat Power continues to break even because its share in coal profits is adjusted
-Coal profit is adjusted against tariff
-Investors fail to appreciate the possibility of optimal mix of short-term trades
-Consolidated renewable energy business can deliver Rs 10,000 crore EBITDA by FY27
- Lowest capital outlay/MW for pumped hydro entails higher platform valuation

-Industry individual APE rose 9 percent YoY in Dec’23 versus -4 percent in Nov’23, +6 percent in Q3FY24
-Private sector rose 11 percent versus -1 percent in Nov’23, +9 percent in Q3FY24
-SBI Life reported growth of 20 percent, versus -3 percent in Nov’23, on a strong base of +31 percent YoY in Dec’22
-HDFC Life reported a decline of 5 percent versus -4 percent in Nov’23, on a base of +23 percent YoY in Dec’22
-ICICI Prudential Life reported growth of 13 percent versus -3 percent in Nov’23, on a weak base of -8 percent in Dec’22

-Upgrade to neutral, target raised to Rs 1,145 per share
-See a meaningful tariff hike in the next 12 months
-Estimate a 20 percent+ tariff hike in CY24
-Expect faster market share shift towards Bharti & Jio Pace as 5G rollout scales up
-Capex pick-up likely as Bharti's Capex is based on improving handset penetration
-Valuation not cheap at 9.4x FY25 proportionate EV/EBITDA

KIOCL temporarily suspends the operation of Pellet Plant Unit in Mangalore due to non-availability of iron-ore fines. The company said it will inform the exchanges when the plant will be back in operation.

Pondy Oxides and Chemicals signed MoU with the Tamil Nadu government to invest Rs 300 crore to 500 crore to set up a recycling and manufacturing plant for non-ferrous metals, lithium-ion batteries, paper, plastics and rubber. The project expects to employ 1200 people in the state.

Sensex Today | BSE Midcap index down 0.5 percent dragged by New India Assurance Company, NMDC, Oil India:

Ramkrishna Forgings has entered into a transformative consultancy agreement with McKinsey, a global management consulting firm.

Under this consultancy agreement, McKinsey will spearhead a comprehensive 15-month transformation program that spans across crucial facets of the Company's operations. The focus areas include Manufacturing, Logistics, Procurement, Manpower, Inventory, Pricing, and more.

The strategic collaboration aims to streamline processes, enhance capabilities, and implement cutting-edge digital systems to ensure sustained success and drive margin improvement.

Lupin today announced the launch of Varenicline Tablets, 0.5 mg and 1 mg, after having received an approval from the United States Food and Drug Administration (USFDA).

Varenicline Tablets is the generic equivalent of Chantix Tablets of PF Prism C.V. It is indicated for use as an aid to smoking cessation treatment.

BGR Energy has received communication from IDBI Bank informing classification of company's account with its non performing assets worth Rs 304 crore.

Sensex Today | Market  at 1 PM

The Sensex was down 124.14 points or 0.17 percent at 71,262.07, and the Nifty was down 48.30 points or 0.22 percent at 21,496.50. About 1603 shares advanced, 1631 shares declined, and 66 shares unchanged.

The consolidated AUM of MAS Financial Services crossed the milestone of Rs 10,000 crore during the quarter and stood at approximately Rs 10,225 crore as on December 31, 2023, registering a strong growth of 27%, YoY.

The Board of Directors of the company in its Meeting held on January 10, 2024 has declared interim dividend of Rs 3 per equity share i.e. 30.00% of the face value of Rs 10.

GHCL Textiles has entered into a Memorandum of Understanding (MoU) with guidance, the Nodal Agency of Government of Tamil Nadu for investing up to Rs 535 crores over a period of four-year.

Sensex Today | Nifty PSU Bank index down 0.6 percent dragged by Punjab & Sind Bank, Bank of India, J&K Bank:

Evoq Remedies has received export order of Rs 136 crores from the Marlexx Pharma Inc. to deliver high-quality pharmaceutical products.

Sensex Today | BSE Capital Goods index down 0.4 percent dragged by AIA Engineering, Timken India, Schaeffler India:

AurionPro Board of Directors in its meeting held on Wednesday, 10th January, 2024 approved raising of funds through issuance of instruments or security including equity shares, convertible/ redeemable preference shares, fully/partially convertible debentures depository, or any other eligible securities by way of one or more public and/or private offerings including on a preferential allotment basis and/or a qualified institutions placement and/or rights issue and/or further public offering for an amount not exceeding Rs 650 crore.

Pondy Oxides share price tocuhed 52-week high of Rs 794.50 in early trade on January 10 after the company signed a Memorandum of Understanding (MoU) with the Tamil Nadu government to set up recycling and manufacturing plants.

".... has entered into a MoU with Tamil Nadu (TN) Guidance, the nodal agency of Government of Tamil Nadu (GoTN) for Investment Promotion and facilitation, to set up state of the art recycling and manufacturing plants for non-Ferrous metals, lithium-Ion batteries, paper, plastics and rubber contributing to sustainability and circular economy to the state of Tamil Nadu," the company said in an exchange note. Read More

Shakti Pumps has received a patent for inventing "a surface helical pump construction with collinear flow”.

The Patent Office, Government of India, has awarded Shakti Pumps this patent, fully adhering to the provisions set forth in the Patents Act of 1970. This patent is set to maintain its validity for duration of 20 years, commencing from the date of filing. This is the 10th Patent that the company has secured.

Sensex Today | Market at 12 PM

The Sensex was up 6.97 points or 0.01 percent at 71,393.18, and the Nifty was down 9.20 points or 0.04 percent at 21,535.60. About 1690 shares advanced, 1509 shares declined, and 84 shares unchanged.

EaseMyTrip.com has launched its new subsidiary, EaseMyTrip Insurance Broker Private Limited.

This is a strategic move by the company to diversify its service portfolio and tap into the insurance market by creating a specialized product to solve customer needs.

The new venture is expected to solidify EaseMyTrip's position in the industry and cater to an Rs 7.9 trillion market with EaseMyTrip’s own 20 Million userbase, company said.

Fitch Ratings has assigned State Bank of India's (SBI, BBB-/Stable) proposed senior unsecured notes an expected rating of 'BBB-(EXP)'.

The notes will constitute SBI's direct, unconditional, unsubordinated and unsecured obligations and will at all times rank pari passu among themselves and with all of SBI's other unsubordinated and unsecured obligations. The notes will be issued by SBI's London branch.

The final rating is subject to the receipt of final documentation conforming to information already received.

Sensex Today | BSE Information Technology index up 0.5 percent supported by Tanla Platforms, Moschip Technologies, Subex:

Cement prices have dropped by Rs 10 a bag across the country with a slight uptick in demand, a recent note from Nomura has indicated. In the South and East India, the commodity turned cheaper by Rs 19 a bag and Rs 11 a bag, while in North, it was down by Rs 10 per bag, and by Rs 5 a bag in West and Central. READ MORE

Tata Group is close to announcing a new semiconductor fabrication plant in India's Gujarat state, Tata Sons chairman Natarajan Chandrasekaran on Wednesday said at an investment summit. READ MORE

The efforts are underway to improve growth prospects across key markets of US/DF and emerging markets.

Raise earnings estimate by 5% for FY25, factoring in a) strong traction in biologics and vaccine portfolio in DF, b) focusing on the niche product pipeline in the US, and c) leveraging specialty portfolio and expanding reach in the emerging markets.

Expect company to register 3.5% YoY earnings growth in FY25, partly due to higher competition in g-Asacol and gradual improvement in the offtake of generic g-Revlimid.

Continue to value stock at 20x 12M forward earnings to arrive at a price target of Rs 710 and maintain neutral stance on the stock on limited upside from its current levels

Shyam Metalics and Energy raised Rs 1385 crore through the Qualified Institutional Placement (QIP) against the total bid amount received Rs 4055 Crs representing 3.5 times the fund received. The QIP Committee approved the issue allotment of 24,051,165 equity shares of face value of ₹ 10 each to 38 QIBs at an issue price of Rs 576 per equity share.

Dynacons Systems and Solutions won a prestigious project of high performance digital workplace solution from Bharat Heavy Electricals Ltd. (BHEL) worth Rs 137 crore.

The scope of work includes providing comprehensive suite of devices, including High End Desktops, Workstations, LED Projectors and UPS paired with an array of services such as device management, security, maintenance, and tech support.

Sensex Today | Market at 11 AM

The Sensex was down 33.06 points or 0.05 percent at 71,353.15, and the Nifty was down 16.90 points or 0.08 percent at 21,527.90. About 1648 shares advanced, 1496 shares declined, and 93 shares unchanged.

Lupin announced the launch of Bromfenac Ophthalmic Solution, 0.07% in the US after receiving approval from US FDA. The solution is used for postoperative inflammation and reduction of ocular pain in patients who have undergone cataract surgery.

Sensex Today | BSE Metal index down 0.6 percent dragged by NMDC, Vedanta, Coal India:

Today, domestic stock indices opened flat, mirroring the subdued trends observed in global markets. As far the current expiry, it is expected that Bank Nifty will trade within the range of 47000 to 47500, with substantial Open Interest at both the Put and Call strikes. The day holds significant importance for Bank Nifty, with 46900 serving as a crucial support level; a breach below this mark could lead to a substantial downside risk.

For Nifty, we foresee resistance levels at 21650 and 21700 for the day, primarily due to active Call writing in At-The-Money (ATM) and Out-of-The-Money (OTM) strikes. On the flip side, the 21,500 level is expected to act as a robust support for Nifty, supported by data from the option chain.

Kirloskar Oil Engines is currently trading at 22.0x/17.8x FY25/26E earnings and value the company on SOTP methodology valuing core business at 20x P/E on March, 26E
earnings.

Maintain buy rating on Kirloskar Oil Engines with a revised Target Price of Rs 840.

The company’s subsidiary Arka Fincap has also raised funds via NCD worth Rs 3 billion, and it is expected to be utilized for further lending. KOEL has the potential for further re-rating from current levels, driven by better-than-expected growth in exports, a higher share of HHP genset sales, and continued expansion of its distribution portfolio.

Shares of Manappuram Finance tanked 7.5 percent in early trade on January 10 after the Securities and Exchange Board of India (Sebi) put on hold the public offer of subsidiary firm Asirvad Micro Finance.

Asirvad Micro Finance had filed a draft red-herring prospectus (DRHP) with the market regulator to raise Rs 1,500 crore from the public back in October. However, the market regulator's decision to put the IPO in abeyance will trigger a delay in the microfinance company's listing.

Manappuram Finance had acquired a significant majority stake in the Chennai-based microfinance firm as part of its diversification strategy. Read More

Shares of KIOCL fell 3 percent at open on the NSE on January 10, a day after the company suspended operations of its pellet plant unit in Mangalore. At 9:20 am, the stock was trading at Rs 358.90. Over the last one year, stocks for KIOCL gained over 70 percent.

On January 10 in an exchange filing KIOCL said that it had temporarily suspended the operations of its pellet plant unit in Mangalore due to non-availability of iron-ore fines. The company has said that it will inform the exchanges when the plant will be back in operation. The company had previously shut down the plant on December 12th, 2023 for a week under similar circumstances. It resumed operations on December 19th. Read More

Sensex Today | Nifty Auto index down 0.5 percent dragged by Sona BLW Precision Forgings, Eicher Motors, Ashok Leyland:

Shares of Cochin Shipyard gained 5 percent on January 10 as the stock turned ex-date for a stock split. At 9:20 am, the stock was trading at Rs 709.

Shipbuilding company, Cochin Shipyard, will be trading ex-split with effect from today, January 10. The company had announced a sub-division of its equity share from a face value of Rs 10 each to a face value of Rs 5 each.

On December 14, 2023, in a regulatory filing, the company informed the exchanges that January 10 had been decided as the date of record for determining the eligibility of shareholders for the sub-division/split of existing equity shares.

Shares of SpiceJet zoomed 5 percent in opening trade on January 10, a day before the company's annual general meeting, where the beleaguered airline plans to seek approval from stakeholders to raise Rs 2,250 crore to fuel its expansion and revitalisation.

The airline also unveiled its vision for SpiceJet 3.0, aimed at bringing 25 grounded aircraft back into operations. The firm's ambitious revitalisation plans have also garnered interest from the investor community, with reportedly 64 entities showing willingness to invest in the low-cost carrier.

To further beef up its presence, SpiceJet is also in the race to acquire bankrupt rival GoFirst. The move is part of SpiceJet's strategic plan to create a combined entity with a market share target of 25 percent.

Achieved sales value of Rs 3,967 crores in 9MFY24. Up by 89 per cent when compared to Rs 2,100 crores in 9MFY23.

Achieved sales value of Rs 1,241 crore for Q3FY24. Up by 56 per cent compared to Rs 796 crores in Q3FY23.

Customer collection for 9MFY24 increased to Rs 2,515 crores compared to Rs 1,597 crores in 9MFY23, up by 57 per cent.

Achieved highest-ever customer collections from the real estate business, which increased to Rs 941 crores in Q3FY24 compared to Rs 621 crores in Q3FY23, up by 52 per cent y-o-y.

Sensex Today | Market at 10 AM

The Sensex was down 29.17 points or 0.04 percent at 71,357.04, and the Nifty was down 16.80 points or 0.08 percent at 21,528. About 1621 shares advanced, 1419 shares declined, and 85 shares unchanged.

Crude oil prices surged amidst escalating geopolitical tensions in the Middle East and a production halt in Libya, sustaining upward pressure. The shutdown of Libya's Sharara oilfield, triggered by political protests, resulted in a daily output loss of around 300,000 barrels. Additionally, U.S. crude inventories posted a substantial decline of 5.215 million barrels, surpassing market projections for a 1.2 million barrel drop. However, the mixed picture continued with increased gasoline stockpiles by 4.9 million barrels and distillate inventories gaining 6.9 million barrels.

Looking ahead, investor focus shifts to Thursday's U.S. consumer and producer inflation reports, anticipating a deceleration in price rises for December. We expect crude oil prices to remain volatile in today’s session, with support at $71.80–71.10 and resistance at $73.20-74.00. In INR, crude oil has support at Rs5,940-5,870, while resistance stands at Rs 6,110-6,190.

Sensex Today | BSE Realty index down 1 percent dragged by Godrej Properties, Phoenix Mills, Oberoi Realty:

The market is moving up and down without a directional trend. Up moves are countered with selling and down moves are responded with buying. A trend might emerge in the coming days in response to Q3 results.

There is an important dichotomy in the market which has implications for investors. Segments like defence and railways have run up too much too fast based on expectations triggered by order inflows. It will take time for these orders to be executed and reflect on the bottom lines. On the other hand there is value in segments like banking, particularly in high quality private sector majors. But this value is not getting reflected in the price. This is a short-term aberration which will correct in the medium to long-term. Here patience is the key.

Q3 results starting tomorrow will be keenly watched. Regarding IT the management commentary will be more important than the results which will be tepid.