Market Recap for 4 May 2021

Nifty50: 14,496 ▼ 137 (-0.9%)
Sensex: 48,253 ▼ 465 (-0.9%)

Today, the markets opened marginally higher and stayed in the green for most of the day. However, strong selling in the last hour of trade resulted in 34 of the Nifty50 stocks closing in the red. 

Among the sectoral indices, only Nifty PSU Bank (+3.4%) witnessed gains. Meanwhile, Nifty Pharma (-2.0%) and Nifty Auto (-0.8%) were the top losers today.  

Here are the top stories of the day.  

Tata Chemicals’ profits slide in Q4

• For Q4FY21, Tata Chemicals reported consolidated revenue at ₹2,636 crore, up 11% YoY. However, profit after tax for the period declined 85% to ₹29 crore, owing to certain one-off costs.
• Its US business was affected by a ₹45 crore spike in energy prices. Further, its UK operations were affected by a one-time tax asset write-off and refinance costs amounting to ₹24 crore. The stock was down 9.4% today, and has declined 5.6% since April.

Supreme Industries hits lifetime high

• Shares of the leading plastic products maker gained 1.7% and hit a lifetime high in an otherwise weak market. The optimism was backed by strong Q4 results, where revenue grew 46% YoY to ₹2,084 crore and profits jumped four-fold to ₹450 crore. 
• The company envisages a capex of ₹400 crore in FY22 and is in a comfortable financial position. It turned debt-free and has a cash surplus of about ₹760 crore as of March 2021.

Morepen Labs slips post Q4 results     

• In Q4FY21, Morepen Laboratories reported a 143% YoY surge in net profit to ₹26.7 crore. Further, its revenue grew 40% YoY to ₹290.7 crore. In FY21, its home diagnostics segment grew the fastest among its business divisions, clocking a 71% revenue growth at ₹287 crore.
• The company had recently approved an investment of $32.5 million from Switzerland-based Corinth Group. Shares of Morepen Labs have gained over 100% in April 2021. However, they witnessed profit-booking today and were locked in the 5% lower circuit.

Home First Finance soars on profit growth

• The recently listed housing finance company reported income from interest on loans at ₹49.6 crore, up 11.2% YoY. Meanwhile, profit after tax at ₹31 crore was up by over 150%. 
• For FY21, its assets under management rose 4.4% YoY to ₹4,141 crore. The stock rose 7.4% intraday before closing with gains of 4.5%. Nonetheless, it trades at ₹511, below its offer price of ₹518.

Closing bell

Yesterday, the market made a smart come-back from lower levels. However, today investor sentiment was weighed down by the buzz around a nationwide lockdown to control the rising cases. After a strong Q4FY21, a sudden pause in business operations has the potential to derail the street’s growth expectations for FY22. Having said that, the benchmark Nifty50 continues to trade within the broader range of 14,300–15,300. Until there is a decisive break on either side, the markets may continue to send confusing signals to directional traders.

Good to know

What’s the difference between limit order and market order?
A market order is used to purchase or sell a stock at its best available price. Usually, these orders get executed as soon as they reach the exchange. On the other hand, a limit order is used to purchase or sell a stock at a specified price. The order gets executed only when the specified price is hit.

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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.