Choppy waters

Nifty50: 16,125 ▼ 89 (-0.5%)
Sensex: 54,052 ▼ 236 (-0.4%)

Hello, there!

Mellow, there?

While all the Beliebers in the country eagerly wait for the October concert, all we’d like to say to the markets is: it’s too late to say sorry. Atleast, for the day! 😠

On a different note, sugar seems to be trending today. India is reportedly planning to restrict sugar exports to prevent an increase in domestic prices. Meanwhile, scientists have found sugar in an unlikely place. They recently discovered that the ocean beds are filled with mountains of sugar equivalent to ‘32 billion cans of Coke’. Huh! Looks like some digging might be in order.

• Markets swung between gains and losses in a choppy session and closed in the negative for the second straight day.
• In all, 32 of the Nifty50 stocks closed in the red.
• Fresh Covid restrictions in Beijing and a sell-off in tech stocks pulled Chinese markets down.

Among the Nifty sectoral indices, Financial Service (+0.3%) and Bank (+0.1%) saw minor gains, while Media (-2.5%) and IT (-1.8%) were the top losers.

Did you know?

You can now place Good-Till-Triggered (GTT) orders on the new Upstox app. To know more about GTT orders, click here.

For more updates on F&O, click here.

What’s trending

⭐ Wind goes out of SAIL 💨
State-owned steel giant, Steel Authority of India (SAIL), reported a 29% year-on-year fall in its Q4 net profit to ₹2,478 crore. Profits shrunk as the cost of raw materials more than doubled in the quarter. However, its Q4 revenue from operations rose 32% to ₹30,759 crore. The company has announced a dividend of ₹2.25 per equity share.

⭐ Divi’s-ive results 👎

Divi's Laboratories fell 5% on Tuesday despite reporting stellar earnings in the March quarter. The company's Q4 profits rose 78% year-on-year (YoY) to ₹895 crore. Revenues jumped 40% YoY to ₹2,518 crore. However, the stock has slumped over 15% since Monday, as investors fret that the company’s high growth may be unsustainable. Covid-related products have boosted the company's earnings, but as the pandemic wanes, investors worry that revenues might dry up. 

⭐ Taj focuses on its core 🏨

Indian Hotels Company, which runs the Taj chain of hotels, has decided to let go of its non-core assets and focus on ‘long-term value’ businesses. This comes after the company incurred losses in the first two quarters of FY22 due to travel restrictions during the pandemic. The company has already raised ₹500 crore after the sale of residential properties in Visakhapatnam and Thiruvananthapuram. Next in line are a few plots in Gurugram and a land parcel in Pune. 

⭐ ABFRL draws fashionable investment 👕

Aditya Birla Fashion (ABFRL) will raise ₹2,195 crore from a minority share sale to an affiliate of Singapore's sovereign wealth fund GIC. ABFRL, which owns brands like Van Heusen and Allen Solly in India, will use the funds to accelerate its business, while also focussing on new high-growth segments. After the deal, GIC will own 7.5% stake in the company, while Aditya Birla Group will hold 51.9%.

⭐Zomato back at the high table? 🍱

Despite weak Q4 results, Zomato shares were riding  high with a 19% spike intraday. And this was thanks to the upbeat outlook from the company’s MD. Deepinder Goyal commented that the food delivery platform’s growth was back on track and they “don’t foresee ‘post-COVID ramifications’ affecting our growth rate anymore.” 

In Focus

Credit cards: On a swiping spree

Despite raging inflation, consumer spending via credit cards has been on a meteoric rise. In March 2022, credit card spending was at a five-month high, touching ₹1.07, a jump of 24.5% as compared to the previous month. This was only the second time the figure has topped the ₹1 trillion mark (the first time was in October 2021 during the festive season).

The jump in credit card spending is crucial as it may be an indicator of consumer confidence. Also, it signals a pick-up in consumption at the ground level, especially as the pandemic wanes across the country.

Meanwhile, new credit cards are also being issued at a break-neck speed. At the end of March 2022, the total number of credit cards stood at 7.3 crore, which is an 18% growth compared to 6.2 crore at the end of March 2021. This shows that consumers are better positioned to take credit. Banks also gain from a rising card base.

In March 2022, ICICI Bank added the highest number of new credit cards at 23.9 lakhs. This is followed by State Bank of India (19.4 lakh), Axis Bank (18.8 lakh) and HDFC Bank (15.5 lakh).

However, HDFC Bank is still the market leader with a 26.6% market share.

Data also suggests that credit cards are predominantly used for online purchases rather than in-store use. In March 2022, India's credit card holders spent ₹68,327 crore on online shopping, almost 76% more than  ₹38,773 crore spent on in-store purchases.

IPO corner

IPO debutants sailed through the choppy market today. Shares of logistics company Delhivery listed at a premium of around 2% against the issue price. After the tepid opening, the stock moved upward and closed 10% higher. Similarly, shares of Venus Pipes & Tubes closed 8.5% higher than the issue price. 

Meanwhile, the IPO of eMudhra was subscribed 2.7 times on the final day. Aether Industries, which launched its IPO today, was subscribed around 33%. Click here to apply for the IPOs on Upstox. 

Good to know

What are preference shares?

As the name suggests, preference shares are a special type of shares. Preference shareholders are the first to receive dividends and have the first right over assets before other shareholders if the company goes into liquidation. Preference shares attract significantly higher dividends as compared to ordinary shares. Hence, a lot of shareholders use them as a means of earning a regular income. However, unlike common shareholders, preference shareholders don’t get voting rights.

Click here to join us on Telegram for trading and investment-related videos, daily market updates, details on upcoming IPOs and more.

Yay 👍 or Nay 👎?

We'd love your thoughts on this market recap.

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