Hindalco profit drops, Gold prices stable & more

Nifty50: 18,285 ▼ 62 (-0.34%)
Sensex: 61,773 ▼ 208 (-0.34%)

Namaste, friends!

Hold onto your seats for this wild wedding adventure. In the town of Bareilly, Uttar Pradesh, a bride's big day took an unexpected turn when her groom decided to pull a disappearing act. But this bride was not one to back down easily. Clad in her full wedding attire, she embarked on a 20-kilometre chase to catch her runaway groom. Finally, her pursuit ended when she managed to track him down at a bus station and hauled him to the mandap to be married under the watchful gaze of both families.

Let's hope their marriage journey is a lot smoother than their eventful wedding day. Speaking of eventful things, the markets oscillated quite a bit today. Let’s take a closer look.

• Markets rose briefly before noon and slumped in the second half to close below 18,300
• In all, 20 of the Nifty50 stocks closed in the red
• The rupee closed 14 paise higher at 82.66 versus the US dollar

Among the Nifty sectoral indices, Pharma (+1.0%) and Media (+0.5%) were among the top gainers, while Metal (-1.5%) and Financial Services (-0.8%) were the top losers.

What’s trending

⭐ Hindalco profit down

Aluminium maker Hindalco (-0.8%) reported a 37% YoY fall in consolidated net profit to ₹2,411 crore, for Q4FY23. Its consolidated revenue for the same period rose marginally by 0.2% YoY to ₹55,857 crore from ₹55,764 crore. The company’s board has recommended a dividend of ₹3 per equity share. 

⭐ Cummins reports robust profit growth

Industrial engine and generator maker Cummins India (-5.5%) reported a standalone profit growth of 68% to ₹318 crore in Q4FY23. This was against ₹189 crore in the comparable quarter last year. Its revenue from operations stood at ₹1,926 crore, up 29% YoY from ₹1,493 crore last year. The company’s board has recommended a final dividend of ₹13 per share. 

⭐ Polyplex Corporation to sell 24% stake

Promoters of packaging company Polyplex Corp (-8.2%) have agreed to sell 24.2% stake to AGP Holdco Ltd for an aggregate consideration of ₹1,379.4 crore. According to the term sheet filed with the exchanges, AGP Holdco will have the option to increase its shareholding at a later stage. It will also have the right to appoint one director to the board of the company.

⭐ Gold remains relatively stable

In the global market, spot gold remained relatively stable at $1,974.76 per ounce. Meanwhile, US gold futures saw a slight increase of 0.2% to reach $1,977.50, as investors await further clarity on the debt-ceiling standoff and the Fed’s interest rate trajectory.

In Focus

India’s OMCs to benefit from lower oil prices

The sharp rebound in economic activities following the pandemic and the Russia-Ukraine war had triggered a surge in oil prices in 2022. But, now oil prices seem to be retreating amid fears of a global recession. 

One of the biggest beneficiaries of this could be India’s oil marketing companies (OMCs) – Bharat Petroleum (BPCL), Indian Oil Corporation (IOC) and Hindustan Petroleum Corporation (HPCL).

Improvement in margins 

The oil prices are currently trading at around $75 per barrel mark. This is significantly lower than the high of $140 per barrel in March last year. 

The fall in crude oil prices has provided a major boost to OMCs, as crude oil is a raw material for them. Experts state that the benchmark Singapore Gross Refining Margin (GRM) increased to $8 per barrel in Q4FY23 from $6 per barrel in Q3FY23. For the uninitiated, GRM is the money that an oil refiner earns from turning every barrel of crude oil into the final product. 

Under pressure 

Analysts believe that the oil prices could continue to remain under pressure in the current financial year. The oil prices are expected to remain range-bound over concerns of subdued demand. The fears of a global recession have also persisted amid the US banking crisis and debt ceiling impasse. China, which is one of the biggest consumers of oil, is also facing sluggish economic growth even after the removal of pandemic-triggered restrictions. 

So, now all eyes will be on how the demand scenario for oil plays out. 

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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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