Bulls fight back

Nifty50: 18,264 ▲ 195 (1.0%)
Sensex: 61,764 ▲ 709 (1.1%)

Namaste, friends!

NASA recently launched a series of tiny cube satellites to observe and predict tropical cyclones from a low-earth orbit. Once deployed, these satellites will form a constellation that will capture hourly data to enhance tropical storm prediction.

That’s great news, but you know what else could use some prediction? The markets of course! They've been see-sawing quite a bit lately. While we wait for NASA to tackle this issue, we can continue to improve our understanding through the traditional method of analysing daily performance. Let’s dive in.

• After last session’s brief dip into the red, markets rise firmly today to close well over 18,200.
• In all, 42 of the Nifty50 stocks closed in the green.
• Markets await domestic inflation numbers to be announced later this week.

Among the Nifty sectoral indices, Auto (+1.7%) and Realty (+1.6%) were the top gainers, while PSU Bank (-0.9%) and Media (-0.6%) were the top losers.

What’s trending

⭐ UPL net profit plunges

Agrochemicals maker UPL (+0.4%) posted a net profit of ₹792 crore for the March quarter, down 43% YoY compared to ₹1,379 crore for the same quarter last year. Meanwhile, its Q4 revenue grew 4% YoY to ₹16,569 crore. The company reduced its net debt by $440 million on account of improved cash flow from operations and a leaner working capital cycle.

⭐ JSW Energy subsidiary signs 300 MW agreement

Shares of JSW Energy gained 1.1% after its announcement to supply 300 MW of wind power for a period of 25 years to Solar Energy Corporation of India through a subsidiary. The wind power project will be located in Maharashtra and is expected to be commissioned in the next 24 months.

⭐ Apar Industries Q4 profit zooms

Cables and conductors manufacturer Apar Industries saw a 4.3% rise in share prices after posting robust Q4 results. Its profit after tax grew by a whopping 193% YoY to ₹242 crore, while its revenue was up 35% YoY at ₹4,088 crore.

⭐ Olectra Greentech shares zoom

Shares of EV bus maker Olectra Greentech (+4.1%) rose significantly intraday, following robust Q4 results. The company reported a consolidated net profit of ₹27 crore, up 54% YoY compared to ₹17.7 crore earned in Q422. During the same period, its revenue rose by over 38% YoY to ₹375 crore.

In Focus

Tyre stocks on the move

Leading tyre stocks have been experiencing significant gains, with JK Tyre, Ceat, and MRF rising in the range of 9 to 13% this month. Several key factors contribute to this positive trend in the tyre industry. Here is the complete breakdown: 

Strong financial results

One of the key triggers for recent stock gains in this sector has been the strong financial results from industry heavyweights MRF and Ceat. MRF's Q4 net profit was up 86% YoY to ₹313 crore, following which the company also declared a final dividend of ₹169 per share. Ceat also reported improved financials, adding to the overall positive sentiment in the sector.

Vehicle sales could gain traction

Domestic passenger vehicle sales made a slow start in the new financial year, down over 1.5% YoY in April 2023. During the same period, sales of commercial vehicles (+2%) and three-wheelers (+57%) picked up. Experts believe the ongoing wedding season could aid sales growth. 

As consumers purchase new vehicles, there will be increased demand for tyres, further supporting the growth of tyre stocks.

Favourable market conditions

The automobile industry is experiencing substantial momentum due to the government's commitment to infrastructure development, rising GDP growth, and significant allocation of funds for capital expenditure in India. These factors create a conducive environment for tyre stocks to flourish, further driving their growth in the market.

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Phrase of the day

Going Long

When you buy a stock, futures or an option contract with the hope that its price will rise, it is called going ‘long’.  When should you go long, find out from this chapter What does going Long mean? 

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