Nifty50: 18,203 ▲ 73 (+0.4%)
Sensex: 61,729 ▲ 297 (+0.4%)
Namaste, friends!
Hold your breath for this incredible story! A Florida professor recently broke the world record for the longest time spent living underwater by being holed up in a tiny bunker 30 feet underwater for 73 days.
With minimal natural light and limited human contact, he is living the life of an aquatic hermit to further the spirit of exploration and plans to make it to 100 days. While his mental state has understandably taken a dip, his other vitals are better than ever – he claims his cholesterol has reduced by 70 points! Maybe we all need to go live underwater for a bit.
Now let's put on our financial goggles and take a closer look at the markets today.
- Markets bounced back today to close above 18,200
- In all, 30 of the Nifty50 stocks closed in the green
- India's gold reserves increased by USD 38 million to USD 46.3 billion
Among the Nifty sectoral indices, IT (+1.4%) and Realty (+0.8%) were the top gainers, while Pharma (-0.9%) and Healthcare (-0.2%) were the top losers.
| Top gainers | Today's change |
| Adani Ports | 691 ▲ 26 (+3.9%) |
| Adani Enterprises | 1,955 ▲ 65 (+3.4%) |
| Tata Motors | 525 ▲ 16 (+3.2%) |
| Top losers | Today's change |
| Divi’s Lab | 3,092 ▼ 61 (-1.9%) |
| Britannia | 4,494 ▼ 70 (-1.5%) |
| ONGC | 164 ▼ 1 (-1.0%) |
What’s trending
⭐ JSW Steel’s Q4 profit rises
Steel manufacturer, JSW Steel (+0.2%) reported a consolidated net profit of ₹3,741 crore for Q4FY23, up 11.9% YoY from ₹3,343 crore. Its revenue from operations for the quarter stood at ₹46,962 crore, up marginally by 0.14% from ₹46,895 crore. The company's board has recommended a dividend of ₹3.40 per share.
⭐ IndiGo reports a profit
Interglobe Aviation (-0.3%), the operator of popular airline IndiGo, reported a net profit of ₹919.2 crore for Q4FY23. In comparison, for Q4FY22 it had reported a loss of ₹1,681.8 crore. Its revenue from operations in Q4FY23 increased 76.5% to ₹14,160.6 crore, while passenger numbers increased by 60.5% to 2.34 crore.
⭐ Zomato reports net loss
Popular food delivery platform Zomato’s (+1.3%) net loss for Q4FY23 nearly halved to ₹188 crore, from ₹360 crore in the same quarter last year. Its consolidated revenue rose by 70% to ₹2,056 crore from ₹1212 crore in the corresponding quarter last year.
⭐ RBI to withdraw ₹2,000 notes
The Reserve Bank of India has decided to withdraw the ₹2,000 denomination banknotes from circulation. However, these notes will continue to be legal tender. People can exchange and deposit these notes in banks till September 30, 2023. People can exchange up to ₹20,000 in 2,000-rupee notes at one time.
⭐ Gold holds steady
Global prices of the precious metal held steady below the $2,000 per ounce levels as the market awaits resolution on the debt ceiling crisis while the dollar slips back slightly from its seven-week high. The price hit an intraday low of $1,980.54 within a few minutes of Asian markets opening.
In Focus
Inflation bites into QSR sales
Post the pandemic, consumption rebounded sharply as pent-up demand drove footfalls and sales across India. Quick Service Restaurants (QSR) were a key beneficiary of this demand revival. However, the rise in demand has also been accompanied by rising prices. And now, inflation seems to be eating into the sales growth of these fast-food restaurants.
Subdued growth
In the March quarter, the adverse impact of high prices was visible. Jubilant FoodWorks – which operates Domino’s outlets in India – witnessed a 0.6% decline in its same store sales. ICYDK, same store sales is a key metric for QSRs, as it looks at the revenue generated by outlets existing for a year and discounts the revenue from newer stores. Sapphire Foods, which operates KFC (2%) and Pizza Hut (-4%) outlets, also reported subdued same store sales numbers.
Inflation woes
The higher prices and competition from smaller brands has led to moderation in delivery and dine-in businesses, according to experts. Simply put, high inflation dents purchasing power and pushes consumers to opt for lower-priced brands. The management of Jubilant FoodWorks acknowledged that slowing market growth and high inflation are near-term concerns. Inflationary pressure such as high dairy prices is also impacting profitability.
Upbeat about future
Despite these near-term challenges, companies have continued expanding their footprints. In Q4FY23, Jubilant FoodWorks added 56 Domino's stores. In the same period, Devyani International, which operates Pizza Hut, KFC and Costa Coffee, also set up 66 new outlets. The management of Devyani said that with inflation showing signs of stabilising, it hopes that consumer spending could bounce back in the second half of FY24.
ONDC effect
The launch of Open Network for Digital Commerce (ONDC) could also be beneficial for fast-food chains. ONDC, which is a government-backed e-commerce initiative, charges lower commissions compared to food-tech players like Zomato and Swiggy. The lower commission could help restaurants improve profitability. They can even pass on these savings to fuel demand.
So, while the challenges remain in the near-term, fast-food chains are looking to ride on India’s consumption over the long-term.
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