Weekly Market Report: Dalal Street rises for fourth straight week; RIL, Adani Group Cos and Grasim Inds in news

Major domestic equity indices ended higher for the week on positive global sentiments, continued buying by FIIs and easing inflation rate in India and the US. For the week, the Sensex gained 1.84% to 59,462.78. The Nifty 50 index rose 1.73% to 17,698.15.

In broader markets, the BSE Midcap index rose 1.17% to 24,765.05 in the week. The BSE Smallcap index increased by 1.09% to 27,905.91.

During the week, FIIs bought for Rs 7850.2 crore in the equity segment, while DIIs sold for Rs 2478.1 crore.

Company News

Reliance Industries (RIL): The conglomerate’s green energy business is expected to emerge as a growth engine for the company in the next 5-7 years, Chairman and Managing Director Mukesh Ambani told shareholders in the company’s recent annual report. “Over the next 12 months our investments across the green energy value chain will gradually start going live, scaling up over the next couple of years. This new growth engine holds great promise to outshine all our existing growth engines in just 5-7 years,” Ambani said.

The country’s largest telecom player, RelianceJio, has completed 5G coverage planning in top 1,000 cities and conducted field trials of its home-grown 5G telecom gears, Reliance Industries said in its annual report. In the report, Reliance Industries Limited, Jio’s parent company, said that Jio took major steps during 2021-22 in getting ready for 5G with its 100% indigenous technology. The company was the biggest bidder in the recently-concluded 5G spectrum auction.

Adani Enterprises: The company plans to invest $5.2 billion in setting up an alumina refinery in the eastern Indian state of Odisha, Bloomberg reported citing statement by the Odisha government. The flagship company of the Adani Group got the approval to build the refinery and a captive power plant in Rayagada for an investment of Rs 416.53 billion rupees ($5.2 billion), according to Bloomber news. The refinery will have an annual capacity of 4 million tonnes.

Adani Ports and SEZ (APSEZ): The company reported a 16.86% decline in consolidated net profit to Rs 1,091.56 crore in Q1FY23, as against a consolidated net profit of Rs 1,312.9 crore in the corresponding period a year ago. Its total income during the April-June quarter rose to Rs 5,099.25 crore, as against Rs 5,073 crore in Q1FY22.

Grasim Industries: The company posted 12.7% increase in consolidated net profit at Rs 2,758.75 crore for the quarter ended June 30, 2022. The company had posted a net profit of Rs 2,447.97 crore in the year-ago period. Revenue from operations was up 40.77% at Rs 28,041.54 crore during the quarter under review as against Rs 19,919.40 crore in the year-ago period. Total expenses were at Rs 24,393.95 crore in the reported quarter as against Rs 16,853.28 crore in the year-ago period.

Coal India: The state-owned company registered a 178% year-on-year growth in consolidated profit at Rs 8,834.22 crore for the quarter ended June FY23. Revenue increased 39% to Rs 35,092 crore compared to the same period last year. The coal mining company produced 159.75 million tonnes of raw coal, up 29% YoY and its offtake of raw coal increased by 10.6% YoY to Rs 177.49 million tonnes for the quarter ended June FY23.

ICICI Bank: Shares of the private lender hit a record high of Rs 865.55, up 2% on the BSE during intraday trading , on the back of strong growth outlook. The share price crosses its previous high of Rs 859.70 on October 25, 2021. In the past two months, the stock has rallied 26 per cent. The bank also now joined the elite club of companies having market capitalisation of over Rs 6 trillion.

Hindalco Industries: The company’s quarterly profit jumped by 48% YoY, on the back of strong US sales and higher revenue that offset the impact of higher raw materials. Hindalco reported a 47.7% rise in consolidated profit after tax (PAT) at Rs 4,119 crore for the quarter ended June 2022. It had posted a consolidated PAT of Rs 2,787 crore in the year-ago period. Sales climbed 40% on-year to Rs 58,020 crore.

JSW Energy: The company said that its arm JSW Neo Energy will buy a portfolio of 1.75 gigawatt (GW) renewable energy assets from Mytrah Energy for Rs 10,530 crore. With this acquisition, JSW Energy’s current operational generation capacity will increase by over 35% to 6.53 GW from 4.78 GW. The transaction is subject to approval by the Competition Commission of India (CCI), the company said.

Divis Laboratories: The pharmaceuticals company reported a 26% rise in its consolidated net profit at Rs 702 crore as compared to Rs 557 crore in the same quarter last year. Its revenue from operations rose about 15% to Rs 2,254 crore in Q1FY23 from Rs 1,960.6 crore in Q1FY22. The company’s forex gain in Q1FY23 rose to Rs 56 crore as against the gain of Rs 20 crore in Q1FY22.

Dabur: The company’s chairman, Amit Burman, resigned from his post on August 10. The company said non-executive vice chairman, Mohit Burman, has been appointed as the non-executive chairman of the board of directors of the company, with effect from August 11 for a period of 5 years. Amit will continue to remain the non-executive director of the fast-moving consumer goods (FMCG) company.

Zydus Lifesciences: The company said its consolidated revenue was up 2% at Rs 4,072.7 crore in Q1FY23 from Rs 4,002 crore in the year-ago period. Its consolidated net profit fell 12% to Rs 518 crore in Q1FY23 as against Rs 587 crore in the year-ago period. The company’s EBITDA dropped 14% to Rs 833 crore in the reported quarter from Rs 972 crore in the same period last year.

Max Healthcare: The company’s revenue was up 7% to Rs 1,066 crore in Q1FY23 from Rs 1,000 crore in the year-ago period. Its net profit rose 18% to Rs 173 crore in the quarter under review from Rs 147 crore in the same period last year. The company’s EBITDA was up 8% to Rs 264 crore in Q1FY23 from Rs 244 crore in the year-ago period.

JSW Steel: The company will invest over Rs 48,000 crore in the next three years as part of its capex plan, the company’s Chairman and Managing Director (CMD) Sajjan Jindal said. Besides, JSW Steel is also eyeing to amalgamate JSW Ispat Special Products with it by the end of the current fiscal. Jindal addressing a shareholder’s said that the Rs 48,700 crore will include Rs 20,000 crore planned for this current financial year.

Eicher Motors: The company reported over twofold increase in consolidated net profit to Rs 611 crore for the first quarter ended June 30, driven by robust sales in the international markets. The company had posted a net profit of Rs 237 crore in the June quarter of the last fiscal. Revenue from operations rose to Rs 3,397 crore in the April-June period as compared with Rs 1,974 crore in the year-ago period, Eicher Motors said in a regulatory filing.

Vedanta Ltd: The company’s chairman, Anil Agarwal, said that the company was targeting $100 billion in revenue by 2030 as it continued to diversify its operations across the natural resources spectrum. Speaking to shareholders at the company’s 57th annual general meeting, Agarwal said that Vedanta had planned a capital expenditure of around $3 billion over the next two years for growth and vertical integration. Of this, $2 billion would be earmarked for the ongoing financial year.

Oil India: The state-owned company reported a 166% year-on-year growth in consolidated profit at Rs 3,230 crore in the quarter ended June FY23. Revenue grew by 86.5% to Rs 11,567 crore in Q1FY23, compared to Rs 6,202 crore in the same period last year.

Power Grid Corporation of India: The company registered a 36.63% decline in consolidated net profit to Rs 3,801.19 crore in Q1FY23 period compared to a profit of Rs 5,998.28 crore in the same quarter last year. Total income of the company increased to Rs 11,168.54 crore in the quarter under review from Rs 10,391.61 crore in the same period a year ago.

Economy News

India’s retail inflation, which is based on Consumer Price Index (CPI), declined to 6.71% in July, from 7.01% in June. The CPI continued to remain above the Reserve Bank of India’s (RBI) upper margin of 6% for the seventh consecutive month.

The Consumer Food Price Index (CFPI) showed a month-on-month fall during July to 6.75%, from 7.75% in June, the data revealed.

The fuel and light segment increased by 11.76%, clothing and footwear category gained 9.91% and the housing segment inched up 3.9%.

Separately, India’s factory output, measured by the Index of Industrial Production (IIP), grew 12.3% in June, according to data released by the country’s statistical agency. The IIP had risen 13.8 per cent in June 2021, the data showed.

The electricity sector rose 16.4% YoY to 196.9 in June, followed by the manufacturing sector, which grew 12.5% to 136.3 and the mining sector output increased 7.5% YoY to 113.4, according to government data.

Global Markets

Wall Street ended higher on hopes that the inflation may have peaked in July and easing oil prices. For the week, the S&P 500 soared 3.25%, the Dow added 2.92%, the Nasdaq surged 3.08%.

The Labor Department said that the inflation based on Consumer Price Index rose at a slower pace at 8.5% in July from the same month a year ago, down from 9.1% in June. Core CPI, which excludes volatile energy and food prices, eased to 0.3% month-on-month in July, down sharply from June’s 0.7% gain.

Japanese stock markets rose over the week, tracking Wall Street, as investors’ sentiments were boosted by lower-than-expected US inflation data. The Nikkei 225 index and the Topix index rose around 1.3%, each.

Chinese equities markets ended the week on a mixed note as positive news of a record trade surplus in July were offset by an increase in coronavirus cases. The Shanghai Composite index added 1.5% and the CSI 300 index inched up 0.8%.

Meanwhile, China reported a record trade surplus of $101.26 billion in July, surpassing the $90 billion estimates. Exports rose a stronger-than-expected 18% from a year ago, while imports grew a less-than-forecast 2.3%. The consumer price index rose 2.7% in July from a year earlier, while the producer price index gained 4.2%. Both inflation readings came in below economists’ expectations.