Market recap for 25 January 2021

Nifty50: 14,238 ▼ -133 (-0.9%)

 Sensex: 48,347 ▼ -530 (-1.0%)

After a gap-up opening, the markets showed signs of weakness early in the day and closed in the red for the third consecutive session. Among the Nifty50 stocks, 31 closed in the red. 

Sector-wise, the Nifty Pharma (1.7%) and the Nifty Metal (+0.1%) indices gained the most, while Nifty IT (-1.7%) and Nifty Realty (-0.7%) indices were the top losers.

Here are the top stories of the day. 

Kotak Bank posts strong Q3 results

• Kotak Mahindra Bank posted a standalone net profit of ₹1,854 crore in Q3, a 16% growth over the same period last year. Net interest income stood at ₹4,007 crore, gaining 17% during the same period. 
• The bank’s gross and net NPAs stood at 2.2% and 0.5%, respectively. Had it declared borrowers over 90 days overdue, gross and net NPAs would have stood at 3.2% and 1.2%, respectively.
• The stock was trading marginally higher today, but closed 1.9% lower at the end of the session.

Grasim gains on entry into paints business

• The flagship company of the Aditya Birla Group soared nearly 9% during the day after it announced its plans to enter the paints business. The board of directors has approved an initial capital expenditure of ₹5,000 crore over the next three years. The decision is pending shareholder approval. 
• The stock closed 5.8% higher today. Meanwhile, shares of major paint makers such as Asian Paints (-2.9%), Berger Paints (-3.2%), Kansai Nerolac (-5.3%) and Akzo Nobel (-2.8%) declined today.

L&T bags two metro projects in Chennai

• The infrastructure major emerged as the lowest bidder for two metro projects in Chennai. The projects are cumulatively worth ₹3,500 crore. Other bidders included Tata Projects and Turkey-based Gulermak.  
• L&T’s shares traded flat (+0.1%) in an otherwise weak market.

DCM Shriram rallies on Q3 performance 

• The chemical and agricultural products maker posted a 44% YoY growth in net profit, which stood at ₹253 crore for Q3. However, net revenues declined 1.6% to ₹2,159 crore due to lower revenues from sugar and chemicals segments. 
• Its shares surged 8% intraday on account of a strong Q3 performance. The stock closed with gains of 3.4%.

Closing bell

Index heavyweight Reliance Industries fell over 5% and dragged the index along with it. The IndiaVIX rose nearly 4% today, which indicates that traders are expecting volatility to rise in the days ahead. The week will be truncated due to the Republic Day holiday tomorrow and after that, the monthly derivative expiry and run-up to the Budget will determine the market’s direction.

Good to know

What is return on equity?

Return on equity (ROE) is a measure of a company’s financial performance calculated by dividing its net income by shareholders' equity. ROE measures how much profit is generated for each rupee of shareholder's equity.

Yay ? or  ? Nay?
We'd love your thoughts on this market recap.

The IPO of Stovekraft is live on Upstox. You can subscribe to the IPOs with Upstox here.

Haven't tried out Upstox yet? Click here to open your account now!

Disclosures and Disclaimer

Investment in securities markets are subject to market risks; please read all the related documents carefully before investing. The securities quoted are exemplary and are not recommendatory. Past performance is not indicative of future results. Details provided in the above newsletter are for educational purposes and should not be construed as investment advice by RKSV group. Investors should consult their investment advisor before making any investment decision.