OMC stocks rebound as crude oil slips, M&M rises on investment in Classic Legends & more

NIFTY50: 20,926 ▲ 19 (+0.10%)
SENSEX: 69,584 ▲ 33 (+0.05%)

• Benchmark indices closed marginally higher ahead of the US Fed meeting outcome
• In all, 31 of the NIFTY50 stocks closed in the green
• The UK economy shrank 0.3% in October, reversing the growth seen in the previous two months

Among the NIFTY sectoral indices, Realty (+1.6%) and Pharma (+1.1%) were the top gainers, while IT (-1.2%) and Oil & Gas (-0.1%) were the top losers.

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⭐ OMC stocks rebound as crude oil slips

Oil marketing companies (OMCs) like HPCL (+5.2%) and Indian Oil (+1.7%) gained today after global crude oil prices fell below $73 per barrel. The drop was driven by concerns over weak demand and lower-than-expected production cuts announced by OPEC+ nations for 2024. Lower oil prices benefit OMCs as it increases their marketing margins from fuel sales. Additionally, they need less working capital for oil imports.

⭐ M&M rises on investment in Classic Legends

Mahindra & Mahindra (M&M) announced that it will invest ₹525 crore in its subsidiary Classic Legends Pvt Ltd (CLPL) over the next 2-3 years. The company will also receive investments of ₹350 crore from external investors. CLPL owns iconic brands including Jawa and Yezdi and operates in the fast-growing premium motorcycle segment in India. Following the announcement, M&M shares closed 2% higher today.  

⭐ Laurus Labs falls after USFDA observations

Shares of the pharmaceutical and biotechnology company closed 1.7% lower today. This was after the company’s subsidiary Laurus Synthesis Private Limited received five observations from the USFDA for its manufacturing facility in Andhra Pradesh. The inspection was conducted from 4 to 12 December 2023.

⭐ KIOCL falls on operation suspension

The government-owned steel manufacturer’s shares declined 1.5% today. This came after the company temporarily suspended operations of its pellet plant in Mangalore with effect from 12 December. The suspension is due to unavailability of iron-ore fines. The company operates a 3.5 million tonnes per annum iron-oxide pellet plant in Mangalore and  manufactures 2.16 lakh tonnes per annum of pig iron.

⭐ HPL Electric hits upper circuit on order win

Shares of the electrical equipment manufacturer hit the 10% upper circuit today. This was after the company received a new order worth ₹545 crore from various customers to supply smart meters. Meanwhile, the company's shares are up over 121% on a year-to-date basis.

IPO Corner

⭐ DOMS Industries IPO received strong traction on Day 1. The IPO of the stationery products maker was subscribed 5.7 times on the first day of subscription. To know more and apply for the IPO, click here.

⭐  India Shelter IPO was oversubscribed on Day 1. The public issue of the affordable housing finance company was subscribed 1.4 times on the first day of subscription. To know more and apply for the IPO, click here.

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What is the marketing margin?

The marketing margin is the difference between the cost price and the selling price of a product. For example, when a distributor or retailer of a product procures it for ₹50 and sells it for ₹60, the extra ₹10 is its marketing margin. Marketing margin is an important metric for businesses because it helps them figure out how much they are earning from selling their products.

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