Paytm rises on RBI move, Oil prices slip further & more

Nifty50: 18,563 ▼ 71 (-0.3%)
Sensex: 62,625 ▼ 223 (-0.3%)

Hello, friends !

Have you ever wondered if there’s a gun that could zap out all the trash in the world? Well, there may not be one for our planet yet, but a team of engineers at the University of Colorado is developing an electrostatic tractor beam to clean up space junk—you know, the defunct satellites and rocket parts floating around in space. Well, enough “trash talk,” let’s take a look at what happened in the markets today.

• Benchmark indices closed lower as bearish sentiments persist
• In all, 33 of the Nifty50 stocks closed in the red
• Traders await the US Fed’s decision on interest rates next week

Among the Nifty sectoral indices, PSU Bank (-1.2%) and FMCG (-0.9%) were the top losers, while Realty (+0.04%) closed flat.

What’s trending

⭐Paytm gains after RBI decision

Shares of One97 Communications, the parent company of Paytm, were up over 5% on Friday after RBI approved the First Loss Default Guarantee (FLDG) programme. Fintech companies in India use FLDG to form partnerships with banks and NBFCs, which help them recoup losses in case of loan defaults. Experts believe the move will strengthen credit penetration and boost the digital lending ecosystem in India.   

⭐ Aether Industries scales new high 

Shares of specialty chemical maker hit a new 52-week high, rising over 3% intraday after the company signed a licence agreement with Saudi Aramco Technologies to manufacture sustainable polyols. As per the company, these polyols have applications across different industries with a targeted market of 8.5 lakh metric tonnes per year. 

⭐IRB Infra reports robust collections

IRB Infrastructure shares rose by over 4% intraday. This comes after the company reported 20% YoY growth in toll collections at ₹411 crore in May 2023. Toll collections were at ₹343 crore in the year-ago period.  

⭐ Oil prices trades lower

Oil prices traded lower in the early morning trades. Slow pick-up in China’s fuel demand outweighed the prospect of tighter oil supplies from Saudi Arabia. As a result, oil prices are headed for a second weekly loss.

In Focus

Cement companies build gains

Shares of leading cement makers, such as UltraTech Cement and Ambuja Cement have risen in the range of 2% to 7% so far this month. In comparison, the Nifty 50 (+0.1%) has remained flat. Why are cement stocks gaining? Let's find out.

Cooling of raw materials prices

Prices of pet coke, one of the key raw materials used as fuel in the cement industry, have tumbled by from their peak. Since March 2023, petroleum coke prices in international markets are down 25%, while domestic prices are lower by 20%. Meanwhile, prices of imported coal have also corrected during the same period.

Experts believe this softening of pet coke and coal prices is a positive for the cement industry and could reflect in the companies' profitability in upcoming quarters. In the previous quarter, high input cost dented the profitability of major cement makers with UltraTech Cement and Ambuja Cement reporting 36% and 10% fall in their net profit, respectively, on an yearly basis.

Improving demand scenario  

Another key factor that has put the sector in the spotlight is the demand trend. Increased spending on infrastructure projects by the government, particularly roads and highways, as well as affordable housing and other schemes announced in the Union Budget will keep cement demand high ahead of the general election in 2024.

With multiple factors in their favour, cement companies have been receiving investor attention. However, a seasonally weak monsoon period could guide stock movement in the near term.

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