Nifty50: 18,268 ▲ +143 (0.7%)
Sensex: 61,350 ▲ +383 (0.6%)
Following a strong opening backed by positive global cues, markets closed on a positive note for a second session in a row. Out of the Nifty50 pack, 39 stocks posted gains.
All the Nifty sectoral indices closed in green with highest gains seen in Realty (+3.6%) and Metal (+2.6%).
| Top gainers | Today's change |
| Tata Motors | ▲ 5.9% |
| Tata Steel | ▲ 4.1% |
| SBI Life | ▲ 3.8% |
| Top losers | Today's change |
| IndusInd | ▼ 1.8% |
| ICICI Bank | ▼ 1.1% |
| Power Grid | ▼ 0.7% |
For more updates on F&O, click here.
Here are the top stories of the day.
Kotak Bank posts weak Q2 results
The leading private sector lender posted a 7% year-on-year fall in its net profit to ₹2,032 crore, which was marginally higher than the street estimate of ₹2,006 crore. The decline in profit was due to a 42% rise in operating expenses and a 27% increase in net provisioning. Meanwhile, its net interest income rose 3% to ₹4,021 crore.
The bank’s asset quality deteriorated marginally from 2.7% last year to 3.1% in the current quarter. Meanwhile, the bank's CASA ratio improved from 57% to 60%. Meanwhile, shares of Kotak Bank were up 2.6% today and have registered gains of over 10% so far this month.
Ceat slumps after Q2 results
Shares of the Mumbai-based tyre maker opened nearly 8% lower today after it reported a sharp 77% year-on-year drop in its net profit to ₹42 crore for the September quarter. This was lower than the street estimate of ₹50 crore. However, the company's revenue rose 24% YoY to ₹2,452 crore.
Its profits were impacted by a 46% YoY rise in cost of raw materials viz. crude oil derivatives and natural rubber, which account for nearly 90% of total raw material costs. Meanwhile, the management commented that the company's debt has also increased slightly due to higher capital expenditure and inventory. Ceat’s stock recovered from the day's low and closed 1.2% higher.
Jagran Prakashan soars on robust Q2
Shares of the publisher of the newspaper Dainik Jagran surged around 16% intraday as its consolidated net profit soared by 422% year-on-year to ₹60 crore in the September quarter. In the same period, the company’s operating revenue rose 39% to ₹402 crore, driven by a 47% jump in advertising revenue.
The management said that cost control measures taken in the last 18 months has helped the company to achieve strong profit growth in this quarter. It also expects the media and entertainment industry to benefit from revival in economic activities driven by the festive season, reduction in new cases and vaccination drive. Meanwhile, shares of the company pared some of its initial gains and closed 6.7% higher today.
Closing bell
The markets rose today with all-round support from various sectors. Whether this rise is just a reaction to the fall (or action) witnessed in the markets last week or resumption of a broader uptrend, remains to be seen. Meanwhile, the cues from the international indices were firm today after the Dow Jones of the US inched up to a new life high. The on-going result season, October series derivative expiry and ensuing holidays next week could build-up volatility and suggests that traders must remain nimble-footed.
Good to know
What is bad loan provisioning?
Financial institutions have to set aside money for loans which have defaulted or could be on the verge of defaulting. This is called as provisioning for bad loans or non-performing assets. The rise in provisioning hurts financial institutions’ profits. However, if they manage to get the money back from the defaulter, then these provisions for bad loans can be reversed and added to the profits. Investors must always keep an eye on whether financial institutions have enough capital buffer to cover for an increase in bad loans.
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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.