Breather

Nifty50: 15,835 ▲ 83 (+0.3%)
Sensex: 53,234 ▲ 326 (0.6%)

Hola, folks!

There could be various reasons to take a day off from work. Health, vacation, or even just a random Monday because you don't feel like working. But did you hear what the cabin crew at Indigo did? They took a 'sick leave' en masse to attend walk-in interviews at Air India. No wonder 55% of the company's flights were delayed on that day!

• Markets halted the three-day losing streak to close higher amid a mixed trend in Asian markets.
• In all, 34 of the Nifty50 stocks closed in the green.
• The rupee closed higher at 78.95 against Friday’s close of 79.04.

Among the Nifty sectoral indices, FMCG (+2.6%) and PSU Bank (+1.6%) were the top gainers, while Metal (-0.9%) and IT (-0.6%) witnessed most losses. 

What’s trending

⭐ Oil companies continue to reel 😥

ONGC (NSE): 126 ▼ 4.9 (-3.7%), OIL (NSE): 201 ▼ 12.8 (-6%)

Shares of state-owned oil and gas companies ONGC and Oil India continued their decline for the second straight session. This was after the government announced on Friday an additional excise duty of ₹23,250 per tonne of domestic crude oil production. The tax on crude oil producers will reportedly fetch the government ₹69,000 crore annually, considering 29.7 million tonnes of oil were produced in FY22.

⭐ NTPC’s power generation rises 

NTPC (NSE): 141 ▲ 0.8 (+0.6%)

In Q1FY23, NTPC posted 21% YoY growth in power generation at 104.4 billion units. Further, in June, 2022, power generation stood at 34.8 billion units, an increase of 29% against 26.9 billion units in June 2021, hinting at an increase in demand for power. The company is also expanding its footprint in green hydrogen, waste-to-energy and e-mobility.

⭐ IndusInd Bank reports strong numbers 👍

INDUSINDBK (NSE): 832 ▲ 24 (+3.0%)

The private sector lender recorded 18% year-on-year (YoY) growth in its net advances to ₹2,49,541 crore in Q1FY23. Meanwhile, total deposits jumped 13% YoY to ₹3,03,094 crore. The retail deposits and deposits from small business customers stood at ₹1,24,105 crore (30 June 2022) against ₹1,20,507 crore ( 31 March, 2022).

⭐Hindustan Aeronautics takes off ✈️

HAL (NSE): 1,784 ▲ 48 (+2.8%)

State-owned aerospace and defence company Hindustan Aeronautics (HAL) closed higher as India's light combat aircraft Tejas emerged as the top choice for Malaysia. The Southeast Asian country is looking to replace its ageing fleet of fighter jets, and it is negotiating with HAL about procurement. India's Tejas edged ahead of aircraft from countries like Russia, China and South Korea.

⭐ Taxes on oil, gold non-inflationary 🔥

Last week, the government levied additional taxes on export of petroleum products and import of gold. However, economists believe that these taxes will be non-inflationary, and will boost government revenue. However, there is uncertainty around how long the taxes will continue. 

In Focus

DMart flying high

Cash registers have been going ka-ching at DMart’s stores. No wonder, then, that the shares of retail chain operator Avenue Supermarts are buzzing. But what's got the customers lining up at the cashier? Let's get down to brass tacks.

DMart’s Q1 FY23 revenues surged to ₹9,806 crore, up a whopping 95% year-on-year. Now that sounds awfully high, and you might wonder, ‘wasn't last year impacted by Covid’? The answer is yes, but even if we consider Q1 FY19, the revenues are up 70%. 

A prime reason is the demand revival in non-essential segments after the pandemic. Consumer spending on items such as footwear and apparel has seen consistent rise, resulting in strong sales.

However, another reason for the topline growth could be inflation. The price of raw materials such as palm oil has pushed FMCG players to raise product prices of food and beverages. But, since these products fall under the essential categories, consumers are still buying them even at an increased price. As a result, there is an uptick in overall revenue for retail chains like DMart.

That’s some food for thought, the next time you go shopping.

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Good to know

What is a down round?
A down round refers to a funding round by a private company, wherein additional shares are sold to investors at a lower price than the previous financing round. This happens when the company requires funds, but discovers that its valuation has dropped below what it was in the prior round. A down round can lower the ownership percentage of existing investors, lead to loss of market confidence and negatively impact the employee morale of the company.

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