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Major domestic equity indices closed higher for the third week in a row as FIIs selling eased and DIIs continued to be net buyers. IT and Realty were top gainers among sectoral indices that pushed benchmark indices higher. For the week, the Sensex closed 1.61% higher at 55,769.23, while the broader index Nifty 50 advanced 1.42% to 16,584.30.
In broader markets, Nifty Midcap 100 rose 1.3% and BSE Smallcap dropped 2.98% during the week.
Top gainers among Nifty sector indices were Realty [4.9%], IT [4.41%], Media [3.59%], Metal [2.25%] and Energy [1.45%]. Top loser were Pharma [-1.98%] and Bank [-0.95%.
In cash segment, FIIs were net sellers but they sold lesser for Rs 6,654 crore, while DIIs were net buyers and bought for Rs 6,844.9 crore during the week.
Nifty VIX, which indicates the volatility of the market, fell 6.98% in the week.
Company News
Reliance Industries Ltd (RIL): The company and US-based Apollo Global Management are teaming to bid for Boots, which is the international chemist and drugstore unit of Walsgreen Boots Alliance, Economic Times reported. The combined bid from Reliance and Apollo for Boots could come in as early as Friday, June 3.
Bharti Airtel: The Mittal family is in talks with several investment banks, via promoter entities, to raise Rs 15,500 crore through onshore/offshore credit lines, to buy a portion of Singtel’s holding in Airtel, according to a report in Economic Times. Mittals are in talks with some major banks like BNP Paribas, Bank of America, Citibank, JPMorgan, and Standard Chartered to raise over $2 billion.
Tata Motors: The Indian automaker and Ford India have signed an MoU with Gujarat government for the potential acquisition of Ford India’s Sanand vehicle manufacturing facility. The acquisition will include land and buildings, vehicle manufacturing plant, machinery and equipment.
The acquisition will increase Tata Motors’ production capacity to 3,00,000 units per year. Tata Motors plans to invest in new machinery and equipment at the plant post the acquisition.
Meanwhile, the automaker has achieved a total sales of 76,210 units in month of May 2022 compared to 26,661 units in May 2021, registering a growth of 185.8%. Total sales comprise of domestic sales of 74,755 units, higher by 204% over May 2021.
The company sold 31,414 commercial vehicles, up 235% YoY and 43,341 passenger vehicles, higher by 185% YoY in the domestic market. The company posted 626% growth in electric passenger vehicle sales of 3,454 units in May 2022 over May 2021.
UltraTech Cement: The company’s board has approved an investment of Rs 12,886 crore ($1.66 billion) to increase its annual capacity by 22.6 mtpa with a mix of brownfield and greenfield expansion. The company in an exchange filing said that this would be achieved by setting up integrated and grinding units as well as bulk terminals.
Adani Group and State Bank of India: The Gautam Adani-led group is in talks with the State Bank of India to raise about Rs 12,000 crore in long-term project loans that would be utilised for building Ganga Expressway. SBI is engaged in a road traffic survey before loan terms are finalised, The Economic Times reported citing three people familiar with the matter.
Maruti Suzuki India (MSI): The company said its total wholesales in May 2022 stood at 1,61,413 units. The company had sold 46,555 units in May 2021. The company said sales in the compact segment, including models such as Swift, Celerio, Ignis, Baleno and Dzire, stood at 67,947 units in May 2022.
Oil and Natural Gas Corporation (ONGC): The state-owned company has applied for the petroleum exploration license before Bihar government citing possibility of crude oil fields in Buxar and Samastipur districts in Bihar. The company has also deposited fees along with initial survey reports of these two districts for the license, said Harjot Kaur Bamhrah, additional chief secretary and commissioner of Bihar’s mining department. “Under the provision of the mining department, we will provide a license for 4 years. There would also be a provision of extending it further,” she added.
Bajaj Auto: The company reported nearly flat sales for the month of May at 275,868 units. The two- and three-wheeler manufacturerhad sold 271,862 units in May 2021. Due to chip shortage, premium motorcycles above 150cc are having a waiting period of nearly 15 days.
Aurobindo Pharma: The drug manufacturer reported a 28.1% YoY fall in consolidated net profit to Rs 576.1 crore in Q4FY22. Its revenue from operations fell 3.2% to Rs 5,809.4 crore in Q4FY22 over Q4 FY21. Shares of the company edged up half a percentage point to Rs 530.80 apiece.
ITC: The company’s wholly owned subsidiary ITC Infotech is eyeing sales of $500 million over the next five years from DxP Services – a unit being created from the acquisition of a portion of US software and services company, PTC’s, product lifecycle management (PLM) business.
Castrol India: The company and MG Motor India are set to collaborate with Jio-bp to explore mobility solutions for electric cars. Under the partnership, Jio-bp, MG Motor and Castrol will explore setting up four-wheeler EV charging infrastructure and expand Castrol’s existing auto service network to cater to EV customers.
YES Bank: The lender plans to buy back overseas bonds worth up to $200 million and issued under the Medium Term Note Programme. The bank will do the repurchase at 97% of the principal amount of the notes, which tendered after the end of the early tender offer period but at or before the expiry of the tender offer.
Life Insurance Corporation of India (LIC): The insurer on Monday reported 18% decline in standalone net profit at Rs 2,372 crore for the quarter ending March 2022. It reported a consolidated net profit of Rs 2,893 crore in Q4FY21.
Its consolidated net premium income rose 18% to Rs 1.44 trillion for Q4FY22 as against Rs 1.22 trillion in the year-ago period. Its board of directors recommended a dividend of Rs 1.50 per equity share with face value of Rs 10 each for FY22.
Economy News
India’s GDP grew 4.1% YoY in Q4FY22, compared to a revised growth rate of 5.4% for Q3FY22. Gross Value Added (GVA), which excludes the impact of subsidies and indirect taxes, grew 3.9% YoY in the fourth quarter of fiscal year 2022.
For the FY22, India’s economy grew at 8.7%, compared to a contraction of 6.6% in FY21. GVA for FY22 expanded 8.1%, compared to a contraction of 4.8% in FY21.
The combined Index of Eight Core Industries stood at 143.2 in April 2022, a rise of 8.4% compared with the Index of April 2021. Final growth rate of Index of Eight Core Industries for January 2022 is revised to 4.0% from its provisional estimates of 3.7%.
The seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index (PMI) was little changed at 54.6 in May, compared with 54.7 in April, indicating a continued and sustained recovery across the sector. The seasonally adjusted S&P Global India Services PMI Business Activity Index rose to 58.9 in May, up from 57.9 in April. The S&P Global India Composite PMI Output Index increased to 58.3 in May, from 57.6 in April.
India’s merchandise exports rose by 15.46% to $37.29 billion in May 2022 helped by strong performance by sectors such as electronic goods, petroleum products and chemicals. Imports during the month grew by 56.14% to $60.62 billion. Trade deficit widened to $23.33 billion during the month, the commerce ministry said on Thursday. The surge was driven by petroleum and crude oil imports, which increased by 91.6% to $18.14 billion.
According to data released by the Ministry of Commerce and Industry on Thursday, India’s merchandise export in April-May of FY23 was $77.08 billion with an increase of 22.26% over $63.05 billion in April-May of FY22.
Goods and Services Tax (GST) collections dropped to Rs 1.41 lakh crore in May 2022, down 16% from April’s all-time high of Rs 1.68 lakh crore, according to data released by finance ministry.
Global Markets
Major US stock indices closed lower as investors were worried over the Fed Reserve’s aggressive monetary tightening policy to curb inflation may lead to recession. For the week, the S&P 500 fell 1.20%, the Dow dropped 0.95% and the Nasdaq lost 0.98%.
In the US, consumer spending, which accounts for more than two-thirds of U.S. economic activity, increased 0.9% last month. Meanwhile, data for March was revised higher to 1.4% from 1.1% as previously reported.
In other economic news, the Labor Department reported on Friday that employers added 390,000 nonfarm jobs in May, well above consensus expectations of around 320,000. The Institute for Supply Management said its manufacturing PMI stood at 56.1 for May, up from 55.4 the month before, indicating that the manufacturing sector was in an expansion mode.
Chinese stocks rose during a holiday-shortened week after the country’s government unveiled a slew of measures to support economy, which was slowed down due to the country’s zero-tolerance approach to the pandemic. For the week ended Thursday, the Shanghai Composite index rose roughly 2.1%, the CSI 300 index climbed 2.2% and Hang Seng increased 1.86%.
Many of the stimulus measures unveiled in the policy package were expansions of previous support measures, such as tax relief, fee reductions, and subsidies, while also proposing measures for stimulating the economy through increased investment and infrastructure spending and guaranteeing the supply of basic resources.
Meanwhile, China’s Caixin/Markit manufacturing Purchasing Managers‘ index for May stood at 48.1 on Wednesday, an improvement over April’s reading of 46, which signalled a contraction in the economy.
Japan’s stock market returns were positive for the week, with the Nikkei 225 index climbing 3.66% and the broader Topix index rising 2.43%, as investors were optimistic after Japanese authorities took steps toward a wider reopening of the country’s borders. Meanwhile, Bank of Japan (BoJ) Governor Haruhiko Kuroda said that medium- to long-term inflation expectations were still low.