Market Recap for 20 May 2021

Nifty50: 14,906 ▼ -124 (-0.8%)
Sensex: 49,564 ▼ -337 (-0.6%)

The markets opened higher but witnessed selling pressure throughout the day. Among the Nifty50 stocks, 36 declined, which indicates broad-based selling.  Among the sectoral indices, Nifty Realty (+1.0%) rose for the second consecutive day, while Nifty Metal (-3.2%) was the top loser.

Here are the top stories of the day.

Bosch jumps on strong Q4 growth

• A nearly five-fold growth in Q4 profit to ₹482 crore sent shares of Bosch soaring 10% intraday. The strong profit growth was supported by a near-halving of employee benefit expenses due to transformation initiatives. Further, last year’s Q4 was significantly impacted by a ₹297 crore exceptional expense on account of restructuring costs. 
• Revenue from operations in Q4 grew 43.8% YoY, driven by high growth in the automotive business, which accounts for 80% of revenues. The stock has risen over 17% so far this month.

Indiabulls Housing Q4 profit doubles

• A 102% growth in net profit and stable asset quality powered a surge in shares of Indiabulls Housing Finance today. The company reported a net profit of ₹276 crore, up 102% YoY. Its net NPA stood at 1.59% versus 1.46% in Q3. Meanwhile, net interest income fell 7.7% to ₹764 core, which was impacted by the reversal of interest on interest on loans under moratorium.
• In April 2021, it entered into a co-lending agreement with HDFC for sourcing home loans. The company believes that with its asset-light model and co-lending partnerships, retail disbursals will gain momentum in the year ahead. The stock closed 9.1% higher today and has gained over 16% so far in May.

NBCC wins order from NIT Uttarakhand

• The state-owned construction company has bagged a ₹597 crore order to construct and develop infrastructural facilities at the National Institute of Technology, Uttarakhand.
• As of the December quarter, it had an order book of ₹62,000 crore, which is nearly 8 times its average annual revenues. The stock traded flat today, but has risen 69% so far in 2021.

TCI Express surges after strong quarter 

• TCI Express reported a 124% jump in profits for the fourth quarter on an annual basis. Higher capacity utilisation and better pricing coupled with strong demand from SMEs drove profits. Its Q4 revenue from operations rose 17% YoY to ₹280 crore. 
• The company has also entered into cold chain logistics and customer-2-customer express services. The express logistics company’s stock hit a new lifetime high of ₹1,299 today. Meanwhile, The stock has surged over 33% so far this week.

Closing bell

China’s move to curb ‘unreasonable’ increase in commodity prices triggered a sell-off in metals, particularly copper, which fell nearly 3% yesterday. Today, investors chose to book profits in high-flying metals stocks, and as a result, the Nifty Metal index fell for the second day in a row. Amid the broader market correction today, the Nifty Midcap (-0.2%) and Smallcap indices (-0.1%) were relatively resilient. Till the result season is on, traders can expect stock-specific action to continue. 

Good to know

What is profit booking?
Profit booking refers to selling a stock whose value has increased in order to get or ‘book’ profits. Until booked, the profit is called as unrealised or notional gain. Profit can be booked completely or partially. In case the growth prospects of the investment seem strong, investors typically sell part of their investment to allow the residual amount to grow. Meanwhile, if the future view on the investment looks uncertain, investors may completely book profits and exit their holdings.

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!

To catch our latest educational videos, join our Telegram channel here.

Disclosures and Disclaimer

Investment in securities markets is subject to market risks; please read all the related documents carefully before investing. The securities quoted are exemplary and are not recommendatory. Past performance is not indicative of future results. Details provided in the above newsletter are for educational purposes and should not be construed as investment advice by RKSV group. Investors should consult their investment advisor before making any investment decision.