Cruising along

Nifty50: 16,220 ▲ 87 (+0.5%)
Sensex: 54,481 ▲ 303 (+0.5%)

Hola, people!

It's Friday and the benchmark indices closed in the green! Time to put your feet on the desk and relax, just like the BBC anchor who was caught doing the same while scrolling his phone on live TV. 

And for those of us who would rather relax at home after work, there is good news. The Netherlands has become one of the first countries to make work from home a legal right!

• After a gap-up opening, the markets closed on a positive note for the third straight day.
• In all, 32 of the Nifty50 stocks closed in the green.
• Earnings season kicks off today, with TCS announcing its Q1 results. More on that below.

Among the Nifty sectoral indices, Bank (+0.5%) and FMCG (+0.5%) saw minor gains, while Metal (-0.8%) and Realty (-0.06%) saw losses.

What’s trending

⭐ M&M gets investment for EV subsidiary 🚗

M&M (NSE): 1,130 ▼ 2.8 (-0.2%)

M&M announced that it has signed an agreement with British International Investment (BII) for its new four-wheeler electric passenger vehicle (EV) company. As part of the agreement, BII and M&M will invest up to ₹1,925 crore each into a newly incorporated subsidiary of M&M. BII will own between 2.75%-4.76% in the new EV company. 

⭐ Tata Power’s push for green energy ♻️

TATAPOWER (NSE): 219 ▲ 5.0 (+2.3%)

Tata Power plans to spend ₹75,000 crore to increase the capacity of its renewable energy business over the next five years. Of this, ₹10,000 crore will be invested in FY23. Besides this, the company is taking a cautious approach to achieve its renewable energy targets and had added 707 megawatts of renewable capacity in FY22.

⭐ Indian pharma cos to make generic anti-diabetes drug 💊

GLENMARK (NSE): 387 ▼ 3.2 (-0.8%)

A key anti-diabetes drug, Sitagliptin, is going off-patent in July. According to industry experts, cheaper generic versions of the drug are soon expected to be launched by Indian pharmaceutical companies. Glenmark Pharma has already launched a generic version, which is 50-70% cheaper depending on the drug combination. 

⭐ Sugar makers get grace period for exports 🚢

RENUKA (NSE): 47 ▲ 0.8 (+1.8%), EIDPARRY 544 ▲ 16 (+3.1%)

The government has extended the deadline for export of 8 lakh tonnes of sugar from 5 July weeks to 20 July. This is because monsoon rains made it tough for producers to move the stock from farms to ports. In May, the government capped exports at 10 million tonnes for the current marketing year, which ends on 30 September.

⭐ Funding dries up for startups 💸

The total funding raised by India's startups in the June quarter fell 33% quarter-on-quarter to $6.9 billion, according to an industry report. The report stated that there has been a downturn in investors' confidence and sentiments towards funding startups. The sentiments changed because of the economic volatility due to tense geopolitical conditions along with the rising inflation and interest rate hikes. 

In Focus

TCS’ attrition woes continue

The earnings season is back, starting with Tata Consultancy Services (TCS). The IT major reported a 4.5% quarter-on-quarter drop in net profit to ₹9,478 crore, which was below street estimates. However, its revenues rose 4.2% to ₹52,758 crore, broadly in line with market expectations. 

The company's operating margin fell to 23.1% from 24.9% in the previous quarter. The management said that the drop in margins was because of the annual salary increases, elevated costs of managing the talent churn, and gradually normalising travel expenses.

The company's attrition rate, which has been a major concern, rose to 19.7% in the 12 months ending on 30 June. This was compared to the attrition rate of 17.4% for the 12 months ending on 31 March.  

Meanwhile, the company won orders worth $8.2 billion in Q1, which is lower than the $11.3 billion worth of orders it won in Q4 of FY22. In terms of new clients, it added nine new customers in the $100 million-plus band in the quarter.

Being the largest IT company by market capitalisation, TCS’ results are often taken as a benchmark for the Indian IT industry. Next week, HCL Tech and Mindtree are expected to announce their results.

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Good to know

What is a generic drug?

When a pharmaceutical company invents or discovers a new drug, they can file a patent, which restricts competitors from selling the same drug for 20 years. However, once the patent expires others can produce and market the generic equivalent of the drug. Generic drugs are essentially the same drug but are made by a different company. Hence, they are required to have the same ingredients and similar therapeutic effects. 

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