Strong start

Nifty50: 17,936 ▲ 103 (+0.5%)
Sensex: 60,115 ▲ 321 (+0.5%)

Howdy, folks!

You might have heard the saying, ‘love knows no bounds’. An electrician in Bihar took this quite literally. The man cut off the power supply of his entire village just to meet his girlfriend in the dark. However, the tale didn’t have the fairytale ending the couple was hoping for. Yes, they were caught. Ah, the things people do for love!

• Tracking positive global cues, Indian markets closed higher for the third straight day.
• In all, 36 of the Nifty50 stocks closed in the green. 
• India’s retail inflation rate for August rose to 7% as compared to 6.7% in July.

All of the Nifty sectoral indices closed higher, with Realty (+2.2%) and Media (+1.9%) witnessing maximum gains.

What’s trending

⭐ Telecom sector’s massive 5G push

BHARTIARTL (NSE): 768 ▲ 3.1 (+0.4%),  IDEA (NSE): 9.6 ▲ 0.1 (+1.0%)

According to an industry report, Indian telecom companies are expected to invest $19.5 billion for the development of advanced 5G infrastructure by 2025. The report further states that the implementation of 5G is likely to benefit the economy by $445 billion between 2023 and 2040.

⭐ Multiplexes score a big hit

PVR (NSE): 1,898 ▲ 64 (+3.4%), INOXLEISUR (NSE): 512 ▲ 18 (+3.7%)

Shares of multiplex stocks like PVR and Inox rose over 5% intraday. This comes after the latest Hindi release Brahmastra posted higher-than expected box office collections over the weekend. Multiplex stocks had witnessed a fall in July and August due to the disappointing performance of big-budget movies.

⭐ KEC International wins EPC contract

KEC (NSE): 447 ▲ 42 (+10.5%)

KEC International has secured an engineering, procurement and construction (EPC) contract worth ₹244 crore from Gujarat Industries Power. The contract is for setting up a pooling substation of 1200 MW in 2,375 MW solar/wind/hybrid renewable energy park in the Great Rann of Kutch area in Gujarat.

⭐ Sunteck Realty acquires land parcel

SUNTECK (NSE): 463 ▲ 3.9 (+0.8%)

Mumbai-based luxury real estate development company Sunteck Realty has acquired 7.25 acres of land in suburban Mumbai. The project is estimated to have development potential of nearly 2.5 million square feet and potential revenue of approximately ₹3,000 crore.

In Focus

Fortunes turn for hotel sector

The hospitality sector has seen a revival in recent months. Shares of companies such as Indian Hotels, EIH, Lemon Tree and Chalet Hotels have outperformed the markets, rising in the range of 50% to 70% so far in 2022. But what’s driving guests to hotels? Let's check in.

For starters, a surge in the number of people travelling after the easing of pandemic restrictions has created robust demand. Further, there is a sharp spike in corporate events like meetings, conferences and exhibitions, which are usually held in hotels. Moreover, the re-opening of the economy was followed by a pick-up in business travel and international tourism. As a result, a sharp rebound was witnessed in hotel occupancy rates.

After the pandemic, the hospitality industry has shifted its focus towards growth led by the average room rate (ARR). During the first quarter of FY23, ARR rose by 20-25%, which resulted in a sharp rise in revenue for listed firms. Indian Hotels and EIH Ltd reported a 28% and 29% quarter-on-quarter revenue growth, respectively. Meanwhile, revenues of Lemon Tree Hotels and Chalet Hotels grew by over 70% each during the same period.

As per industry experts, a sharp uptick in occupancy rates with limited capacity addition, will keep the ARR rates high, improving the industry’s long-term dynamics. Having said that, an unexpected inflationary pressure might lead to customers cutting down on discretionary spending, which could negatively impact the industry.

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Good to know

What is value investing?

Value investing is a strategy used by some investors to pick out stocks that are trading for less than their intrinsic or book value. Value investors use various metrics to find the right valuation of a particular stock. They track down stocks they think are being undervalued by the market and buy them in the hope that they will appreciate in the future.

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