Merry Monday

Nifty50: 17,311 ▲ 126 (+0.7%)
Sensex: 58,410 ▲ 491 (+0.8%)

Hey there, people!

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• Benchmark indices rebounded back from the red to close higher despite weak global cues.
• In all, 37 of the Nifty50 stocks closed in the green. 
• Investors await data on US industrial production to be released on Tuesday.

Among the Nifty sectoral indices, PSU Bank (+3.4%) and Bank (+1.5%) saw the most gains, while Metal (-0.9%) and Media (-0.8%) were the top losers.

What’s trending

⭐ Shree Cement’s profit plunges

SHREECEM (NSE): 20,810 ▼ 378 (-1.7%)

Shares of Shree Cement fell 4% intraday after the company reported a 67% year-on-year (YoY) fall in its net profit at ₹189 crore. However, revenue from operations rose by 18% YoY to ₹3,781 crore. Higher volumes coupled with better realisations aided the growth in revenues. However, the usage of high-cost inventory of coal and petcoke impacted the profitability.

⭐ Biocon rises on licencing deal

BIOCON (NSE): 264 ▲ 3.1 (+1.1%)

Biocon Biologics, a subsidiary of Biocon, has entered into a strategic out-licensing deal with Japanese pharma company Yoshindo. Under the agreement, Yoshindo will get exclusive rights to sell two biosimilars in the Japanese market which have an addressable market opportunity of $700 million. Biocon Biologics will receive an upfront licence fee along with additional payments on the achievement of certain development milestones.

⭐ Govt raises windfall tax on oil

ONGC (NSE): 128 ▲ 0.4 (+0.3%); OIL (NSE): 184 ▼ 1.7 (-0.9%)

The government, in its fortnightly review, has revised windfall profit taxes on oil products. Taxes on export of diesel were raised to ₹12 per litre from ₹6.5 a litre, while a levy of ₹3.5 per litre was imposed on export of aviation turbine fuel. The government also hiked taxes on locally produced crude oil by 37.5% to 11,000 per tonne. The tax revision is in line with the rise in crude oil prices in the international markets.

⭐ PVR’s losses narrow

PVR (NSE): 1,692 ▲ 0.05 (+0.0%)

Multiplex chain PVR reported total revenue of ₹703 crore, up 155% YoY during the September quarter. The company also managed to cut down its losses to ₹71.5 crore from ₹153.3 crore a year ago. During the quarter, PVR reported an 11% rise in average ticket prices to ₹224 and added 14 new screens across 3 properties.

In Focus

India Inc braces for recession 

According to an industry survey, a large majority of Indian CEOs predict a mild and short recession over the next year. Nearly seven out of 10 CEOs interviewed believe a recession (if it happens) will impact company earnings by up to 10% over the next 12 months. But what are the key factors behind this? Let’s find out. 

According to the survey findings, the risk of recession has risen in the last few months because of consecutive interest rate hikes by central banks across the globe to tackle inflationary pressures. Besides this, geopolitical tensions between Russia-Ukraine have also led to an economic slowdown.

Furthermore, one-third of the CEOs said their companies have implemented a hiring freeze in the short term. However, over the next three years, 79% CEOs expect their organisation headcount to increase. 

The survey cited management of Tata Steel, which said geopolitical issues are the number one risk at present, and the company is focusing on building optimised and resilient supply chains.   

Meanwhile, the management of Raymond was more optimistic and said that the Covid shock served as a detox for all Indian businesses and led to the adoption of digital technologies and identification of new growth areas that can balance out core business models.

Overall, CEOs in India surveyed appear much more confident in their organisation’s resilience as well as global economy (82%) than they did in February 2022 (40%). But will India be able to weather the impact of recession (if it happens)? Well for that we need to wait and watch.

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Good to know

What is same store sales growth?

Same store sales growth (SSSG) is a metric used in the retail industry. It refers to the rise in sales from existing stores that were open during a specific period. This helps investors in discounting the impact of new store openings on the overall revenue. It also reflects the management’s effectiveness in increasing sales from the existing assets. Investors look at this metric as it is important to know whether the rise in revenue is taking place from existing locations or it is merely because of new store additions.

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