Market Wrap: Sensex ends higher led by RIL, L&T, ITC; Nifty closes above 19,700

Manappuram Finance has confirmed that the Kerala High Court invalidated the FIR lodged against VP Nandakumar, managing CEO and director, in connection with a money laundering case, reported Moneycontrol.

The luxurious residential project has a carpet area of 400,00 square feet, and has revenue potential of ₹1,200 crore

The stock after the decent rally has corrected to some extent to retrace 23.60% of the rise and has witnessed consolidation with improvement in the bias at current levels. The RSI has also flattened out after the slide and is well placed with much upside potential visible. With the chart looking good, we suggest to buy and accumulate this stock for an upside target of 300 keeping a stop loss of 238.

Aditya Birla Group had in May announced its plan to acquire a majority stake in TCNS Clothing, sealing a deal valued at ₹1,650 crore.

European equities were mixed in trade on Wednesday, while the dollar maintained its recent gains, all against the backdrop of anticipated prolonged higher US interest rates and a looming property crisis in China.

Across Asia, South Korea, Japan, and China saw slight gains in their stock markets, while Australia witnessed a dip. The upward momentum in equities in Hong Kong and mainland China comes in response to encouraging data revealing improved industrial profits in China.

Market regulator Sebi is examining a proposal from the NSE to extend trading hours for index derivatives but a final decision has not yet been taken, two sources with direct knowledge of the matter told Reuters.

“The ongoing conflict in Ukraine and rising tensions between the US and China have kept gold prices elevated in recent months. The Indian rupee has been falling against the US dollar in recent months, which has made gold imports more expensive. This has put downward pressure on gold prices in the domestic market.

Despite the recent decline, gold prices are still higher than they were a year ago. In September 2022, 22-carat gold was trading at ₹4,950 per gram, while 24-carat gold was trading at ₹5,450 per gram.

Investors who are considering buying gold should carefully consider their investment goals and risk tolerance. Gold is a relatively illiquid asset, and its price can be volatile. However, it can also provide a hedge against inflation and other economic risks.”

We expect 14-15% AUM CAGR and 18-19% earnings CAGR over FY23-25 with average RoA/RoE delivery of 3.3%/16%. For reviewing estimates, we would closely monitor a) pricing and volume growth in used CV/PV segment, b) distribution roll-out of GL and MSME Loans in vehicle financing branches and success in cross-sell, c) emerging signs of stress in PL and MSME Loan portfolios (Stage-2 coverage seems low in these products) and d) cost of funds. Even after a strong run-up in the past 3-4 months, the stock’s valuation is reasonable at 1.4x P/ABV and 8.5x P/E on FY25 estimates. Retain BUY with a price target of Rs2300.

The agreement between Suzlon Energy and Dilip Shanghvi and Associates has been terminated. Hiten Timbadia, the investor group’s nominee director on the Suzlon Energy board, has also resigned. Suzlon said there will be no impact on the company’s operations.

Manish Jain has been appointed as country head- wholesale banking

State-run REC has signed a memorandum of understanding with Punjab National Bank to jointly explore the possibility to fund the power sector and infrastructure & logistics sector projects under the consortium arrangement. REC and PNB will partner to co-finance loans amounting to ₹55,000 crore over next three years.

The semi-annual rejig of Nifty indices will come into effect on September 29, with adjustments occurring on the day before on September 28. The move will result in significant inflows in some stocks including HDFC Bank, Power Grid Corp of India, Shriram Finance and Trent while some others such as NTPC, Page Industries and HDFC Asset Management Company will be among those that will see outflow, said Abhilash Pagaria,   head of Nuvama Alternative & Quantitative Research.

Certain indicators show these midcap stocks can scale new heights in 2024, says Equitymaster.

Adani Ports and Special Economic Zone Ltd informed exchanges on Wednesday that it will buy back up to $195 million of its notes due in 2024 at a price below their original issue.

Moody’s Investors Service downgraded Vedanta Resources’ corporate family rating from Caa1 to Caa2 over elevated risks of debt restructuring over the next few months. With the current downgrade, the outlook remains negative for the parent company of Vedanta.

Sensex was up 227 points at 66,172.52, and the Nifty rose 65 points to 19,729 in the reopening session

Investor demand for sovereign gold bonds surged to a record 11.67 tonnes valued at ₹6,914 crore in the second tranche of the current fiscal year despite high gold prices.

Rising global macro uncertainty and high retail price inflation back home, amid rising crude oil prices, are driving investor demand, according to a banker and a senior broking official. (Full report)

The SME segment has seen an impressive 135 listings so far this year, compared to just 33 in the primary markets. Industry experts have a word of caution for retail investors. They warn that a combination of financial strategies, market manipulation, and information dissemination can impact stock valuations. (Read more)

Religare Enterprises is now more than a financial investment for the Burman family, Dabur India chairman Mohit Burman said, after its proposal to take control of the insurance and financial services firm. In August, the family categorized its stake in Religare as a financial investment. (Full report)

The Directorate General of GST Intelligence (DGGI) is expected to issue tax demands of as much as ₹1.5 trillion ($18 billion) cumulatively to companies in the online gaming sector for alleged underpayment of taxes over several years, three people aware of the matter told Mint. (Full report)

West Texas Intermediate climbed near $91 a barrel after ending 0.8% higher on Tuesday.

“Nifty once again closed on a flat note near 19,650 zone with support maintained near the 19,600 levels with consolidation witnessed in the past the two sessions. As mentioned earlier, the index has got the crucial near-term support zone at around 19,550 levels of the significant 50EMA zone which needs to be sustained.

Bank Nifty has maintained the support near 44,500 levels in the last three sessions witnessing a rangebound movement and a decisive breach above 44,800 is necessary as of now to improve the bias to some extent, according to Parekh.

The index has the next crucial support zone of 43,600 levels and on the upside a decisive breach above 45,000 levels is much important to improve the overall trend and anticipate for further rise. The support for the day is seen at 19,550 levels while the resistance is seen at 19,800 levels. Bank Nifty would have the daily range of 44,300-45,000 levels.”

Parekh recommends buying the following stocks:

-Hero MotoCorp Ltd at ₹3,034 with a stop loss of ₹2,990 and a target price of ₹3,150.

-Mazagon Dock Shipbuilders Ltd at ₹2,234 with a stoploss of ₹2,200 and a target price of ₹2,370.

-Mishra Dhatu Nigam Ltd at ₹410.70 with a stoploss of ₹400 and a target price of ₹440.

The ministry of corporate affairs and the capital markets regulator are in favour of allowing certain classes of companies to issue so-called fractional shares, a person aware of the development told Mint. (Full report)

Vedanta, Infosys, Suzlon, Shree Renuka Sugars, REC are among the top ten stocks that are likely to be in focus today

Asian markets traded mixed on Wednesday amid worries about the impact of higher interest rates. Investors await China’s industrial data and Australia’s August inflation figures due today. Tuesday, Wall Street’s major stock indexes followed Asian and European equities lower as investors continued to digest last week’s indication from the Federal Reserve that it would keep rates higher for longer than investors had previously expected.