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Benchmark indices closed higher during the week, driven by strong buying by foreign institutional investors and encouraging business updates from Indian companies. The Sensex crossed the 65,000-mark and the broader index Nifty50 settled above the 19,300 level. For the week, the Sensex ended 0.87% higher at 65,280.45 and the Nifty 50 index gained 0.74% to close at 19,331.80.
On the weekly chart, both the Sensex and the Nifty 50 indices formed a shooting star candlestick pattern, indicating a bearish trend in the coming weeks.
In broader markets, the BSE Midcap index climbed 0.77% to 28,999.02 and the BSE Smallcap index rose 1.62% to close at 33,129.41.
Top gainers among Nifty sectoral indices were Media [8.7%], PSU Bank [8.49%], Oil & Gas [4.26%], Energy [2.57%], and Auto [2.32%]. Top loser was Private Bank [-0.24%]. Nifty IT [-0.01%] and Pharma [0.02%] ended flat.
In cash segment, FIIs were net buyers for Rs 9,164.80 crore and the DIIs were net sellers for Rs 6,878.2 crore.
Indian rupee weakened by 22 paise to 82.74 as against the US dollar on Friday. Indian rupee is expected to further fall towards 83-83.30 levels, according to analysts as they remain bullish on the US dollar.
Company News
Reliance Industries (RIL): The National Company Law Tribunal has approved the demerger of Reliance Industries’s financial services undertaking into Reliance Strategic Investments, to be renamed Jio Financial Services. Reliance Industries and Reliance Strategic Investments will take the necessary steps, including fixing the record date for allotment and listing of equity shares of Reliance Strategic Investments, to be renamed Jio Financial Services.
Meanwhile, Reliance Jio Infocomm is likely to finalise a $1.7 billion deal with Finland-based Nokia to buy 5G network equipment, The Economic Times (ET) reported citing sources. This new deal is in addition to the $2.1 billion worth of 5G equipment deal signed with Sweden’s Ericsson. The deals will help Jio’s plans of rolling out 5G services across the country by the end of this year, the report said.
Tata Motors: The automaker said its witnessed a strong Jaguar-Land Rover (JLR) sales during the quarter ended June 2023. Wholesales volumes in Q1FY24 were up 30% YoY to 93,253 units. JLR retail sales in Q1FY24 were 101,994, up 29% over Q1FY23. The company said JLR order book remained strong at 1,85,000 units, reflecting strong client demand, according to its business update. It added that demand for Range Rover, Range Rover Sport and Defender continues to be particularly strong, with retail sales up significantly compared to Q1FY23 and representing 76% of the order book. Shares of the company ended 2.9% higher at a lifetime high of Rs 618.20 apiece.
State Bank of India (SBI): India’s largest lender has received approval from its Executive Committee of the Central Board (ECCB) for acquiring the entire stake held by SBICAPS in SBICAP Ventures, subject to receipt of all regulatory approvals. SBICAPS is a wholly owned subsidiary of SBI. The estimated cost of capital for the said acquisition will be Rs 708.07 crore.
Hero MotoCorp: Shares of the two-wheeler maker jumped 4.21% after the company announced the commencement of bookings for its inaugural co-developed premium motorcycle, the Harley-Davidson X440. Bookings can be made online or at select Harley-Davidson dealerships and Hero MotoCorp outlets, with a booking amount of Rs 5000/-. The Harley-Davidson X440 comes in three variants with an introductory price starting from Rs 2.29 lakhs and deliveries will begin in October 2023. Meanwhile, Eicher Motors, which manufactures Royal Enfield motorcyles, tanked 6.31%.
Bajaj Auto: The company, in collaboration with British motorcycle major Triumph, launched the Speed 400 premium bike for the Indian market at an ex-showroom price of Rs 2.33 lakh. The introductory price will be applicable for the first 10,000 customers, Bajaj Auto-Triumph announced at the launch event. The online pre-booking for Speed 400 was kicked off in India last month, with a Rs 2,000 fully refundable payment window, after its world premiere in London. Shares of the company surged 5.7%
One97 Communications (Paytm): The company posted a 37% growth in gross merchandise value (GMV) at Rs 4.05 trillion in the April-June quarter of this year as against Rs 2.96 trillion in the same period a year ago. The value of loan disbursed through Paytm grew over 2.5 times to Rs 14,845 crore, from Rs 5,554 crore a year ago and the volume grew by 51% to 12.8 million in April-June 2023 period, from 8.5 million during the same period last year. The average monthly transacting users grew 23 per cent on a year-over-year basis to 92 million during the reported quarter from 75 million in the June 2022 quarter.
Olectra Greentech: A consortium of the company and Evey Trans has received Letter of Intent (LOI) from Maharashtra State Road Transport Corporation (MSRTC) to supply 5,150 electric Buses. The order includes supply, operation and maintenance of 5, 150 electric buses and allied electrical and civil infrastructure. The order is based on on gross cost contract (GCC) / OPEX model over a period of 12 years.
SpiceJet: The Supreme Court has refused to grant extension to SpiceJet, and has reprimanded the airline for failing to pay Rs 75 crore to Maran, according to the apex court’s earlier order. The court also directed SpiceJet to pay the entire arbitral amount of Rs 380 crore to its former promoter Kalanithi Maran. The case is related to the share transfer dispute between SpiceJet’s chairman and managing director Ajay Singh and Maran as well as his KAL Airways.
Zen Technologies: The company announced that it has secured an order from the Government of India valued at approximately Rs 160 crore. The company said that the order is part of the government’s indigenous design and development (IDDM) initiative, which requires Indian IP and over 60% indigenous content. Zen Technologies is a leading provider of military training and anti-drone solutions. Shares jumped 4.53% in intraday trade on the NSE.
Adani Green Energy: In a regulatory filing, the company said that the board has approved raising of funds by issuance of equity shares of face value of Rs 10 each for an aggregate amount up to Rs 12,300 crore through qualified institutional placement (“QIP”). The fundraising is subject to the receipt of the necessary approvals from shareholders and regulatory authorities.
BSE: The board of directors has approved a share buyback of up to Rs 375 crore via tender route. The buyback has been approved at Rs 816 per share. The company said it will buyback 4,593,137 equity shares, representing 3.39% of the total number of equity shares in the total paid-up capital. Buybacks are seen as a tax-efficient way to give cash back to investors.
HDFC Bank, HDFC: After the merger of HDFC and HDFC Bank, its combined loan book expanded by 13.1% year-on-year (YoY) to Rs 22.45 trillion at the end of Q1FY24. The merged entity’s deposits grew by 16.2% YoY at Rs 20.63 trillion at the end of the first quarter. The merged entity’s average Liquidity Coverage Ratio (LCR) was around 120% for the quarter ended June 30, 2023. Shares of HDFC Bank tanked 3.18% and HDFC plunged 3.07%.
Titan Company: The jewellery-to-watch retailer has registered a 20% year-on-year growth in revenue for June FY24 quarter, with all key consumer businesses exhibiting double-digit growth in the quarter. A total of 68 stores were added (including CaratLane) during the quarter taking Titan’s retail presence to 2,778 stores.
Bombay Dyeing: The company is in talks to sell a part of its land parcel in Central Mumbai at a valuation of R 5,000 crore, Busisess Standard reported citing sources. A Japanese conglomerate is leading the race among the bidders to acquire the land which has a development potential of 2 million sq. ft. for commercial purposes. The proceeds from the sale of land parcel will be used to reduce part of the company’s debt and for other corporate purposes.
LTIMindtree: The Index Maintenance Sub-Committee (Equity) of NSE Indices has decided to exclude HDFC and include LTIMindtree in Nifty50 and Nifty Next 50 indices with effect from July 13. Jindal Steel & Power will replace HDFC in the Nifty 100 and Nifty Midcap 150 indices, while Mankind Pharma will replace HDFC in the Nifty 500 index. LIC Housing Finance will replace HDFC in the Nifty Financial Services index.
Ideaforge Technology: The drone manufacturer had a bumper stock market debut on Friday. Shares of the company opened at Rs 1,300 as against an issue price of Rs 672 per share. Its share price hit a high of Rs 1,343.95 apiece in early trade and closed at Rs 1,294.95 crore per share.
Economy News
The seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index (PMI) declined to 57.8 in June from 58.7 in May. The PMI has been above the neutral level of 50 consistently for two years now, indicating expansion. The S&P Global India Services Purchasing Managers’ Index (PMI) fell to 58.5 last month from 61.2 in May. India’s composite PMI reading slipped to 59.4 in June from 61.6 in May.
India’s GST collection in June stood at Rs 1.61 lakh crore, higher by 12% YoY and it is the 16th consecutive month that monthly GST revenue has been above Rs 1.4 lakh crore.
Meanwhile, India’s services exports in May climbed 7.7% YoY to $27.1 billion, while imports rose 2% to $15.5 billion, showed provisional data by RBI.
The Ministry of Coal said it has achieved an increase in overall coal production with a growth of 8.4% in Q1FY24. The cumulative coal production touched 222.93 million tonne (MT) as compared to 205.65 MT in Q1FY23.
Global Markets
The US markets declined during the week after the minutes of the Federal Reserve’s latest policy meeting hinted that the interest rates are likely to remain higher for longer period of time. For the week, the Nasdaq dropped 0.92%, S&P 500 index fell 1.16% and the Dow Jones tanked 1.96%.
On the economic front, the Labor Department reported that employers added 209,000 nonfarm jobs in June, lower than 306,000 nonfarm jobs in May. The unemployment rate edged down from 3.7% in May to 3.6% in June. The report also revealed that the number of people employed part time jumped by about 11% in June. The ADP private payrolls report showed 497,000 jobs added in June and May’s total was revised downwards by 11,000 to 267,000.
The ISM’s Manufacturing PMI fell to 46 in June, the lowest reading since May 2020, from 46.9 in May. The reading showed that it was the eighth straight month that the Manufacturing PMI stayed below the 50 threshold, which indicated contraction in manufacturing. The Institute for Supply Management (ISM) said on Thursday that its Non-Manufacturing PMI increased to 53.9 last month from 50.3 in May. A reading above 50 indicates growth in the services industry, which accounts for more than two-thirds of the economy.
Chinese shares fell after the latest economic data weighed on investors’ optimism over the country’s post-pandemic recovery. The Shanghai Stock Exchange index fell 0.17%, while the CSI 300 lost 0.44% and the Hang Seng index plunged 2.91%.
On the economic front, the private Caixin/S&P Global survey of manufacturing activity eased to 50.5 in June from May’s 50.9 as expansion of manufacturing output and new orders softened. The Caixin survey of services activity fell to a lower-than-expected 53.9 in June from 57.1 in May, its sixth successive monthly expansion but lowest reading since January. Meanwhile, China unveiled export controls on two key minerals — gallium and germanium — in the latest development of an ongoing trade war over microchips between Beijing and Washington. The metals are important for the production of microchips, military equipment, and communications.
Japan’s stock markets fell over the week, with the Nikkei 225 index losing 2.4% and the broader Topix index falling 1.5%. Both indices retreated from 33-year highs as investors booked profits, especially in strongly performing technology stocks. Sentiment among Japan’s businesses improved in the second quarter, according to the Bank of Japan’s quarterly Tankan survey. Further, Japanese Yen strengthened to about JPY 143 against the US dollar from about JPY 144 in the preceding week.