Bears crawling back?

Nifty50: 17,530 ▼ 144 (-0.8%)
Sensex: 58,576 ▼ 388 (-0.6%)

• The markets extended their fall for the second straight day on the back of weak cues from the international indices and a bounce back in crude oil prices. 
• In all, 39 of the Nifty50 stocks closed in the red.
• India’s inflation rate spiked to 6.95% in March (details below). A high inflation rate could act as an overhang on the markets and it could build expectations of a hike in interest rates.

Among the Nifty sectoral indices, Bank (+0.3%) and Financial Service (+0.02%) saw marginal gains, while Realty (-2.7%) and Metal (-2.7%) were the top losers.

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Here are the top stories of the day.

Blue Star raises prices

Blue Star has raised the prices of its products by 2-3% this month to offset the rise in prices of commodities like aluminium and steel. This summer, the company is expecting sales to grow by 25% despite the price hike. As per the company, 40% of the sales take place in the months of March, April and May.

Banking on the growing demand amid soaring temperatures, other air-conditioner companies have also hiked the product rates by 3-4%. These hikes come on the back of a 5-8% price increase in January ‘22.

Inflation rises to 6.95% in March

India's retail inflation stood at 6.95% in March, as compared to 6.07% in February. The sharp jump was on account of 7.68% rise in food inflation. This is the third straight month in which the inflation was above 6%, the RBI’s upper end of the tolerance band.

The inflation rate stood well above the street estimates of 6.35%. Generally, a high inflation rate acts as a sentiment spoiler for investors because it could eventually trigger an interest rate hike from the central bank in a bid to control inflation.

Cement to get more expensive

With the increasing prices of raw materials due to the ongoing geopolitical tensions, cement companies are reportedly planning a significant price hike from this quarter. This month, the prices have already risen by ₹20-50 per bag i.e. 4-12%, across regions. 

According to analysts, this is inevitable considering that the sector’s profitability has been affected due to moderate hikes in the past six months. They expect the prices to drop during monsoons and also with eventual decrease in input costs.

IPO corner

According to reports, Delta Tech, which operates online poker site Adda52, will soon file its draft papers with the market regulator SEBI for the IPO. It is a 100% subsidiary of listed casino operator Delta Corp. The management of Delta Corp has said that the IPO will consist of a fresh issue as well as an offer for sale.

Good to know

What is operating margin?

The operating margin reflects how much profit a company makes after paying its variable cost like wages and raw materials but before paying out interest and tax. This shows how efficiently a company’s operations are being managed. Operating margin is calculated by dividing operating income by net sales. A high operating margin is better for the company. Investors gauge the efficiency of a company by comparing its operating margins to that of its peers.

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