MarketBuzz
1261: Marketbuzz Podcast With Hormaz Fatakia: IRCTC, ABFRL, Tata Steel in focus
Good morning and welcome to CNBC TV18's Market Buzz podcast. I am Harmas Patakia, there are jittas on the street, there is no doubt about that. Now the more we draw closer to the May series expiry, the 1st of June and the 4th of June, the volatility continues to increase the India weeks on Tuesday cross levels of 24. Now that shows up in the performance of the Nifty as well in the last three sessions. The index is making new highs but it is failing to sustain at those levels and is not seeing any form of follow up buying at higher levels. Now this making of a new high trend was absent on Tuesday as the index even failed to cross 23,000 on the upside and eventually ended below the 2900 mark. Therefore 23,000 becomes the first barrier for the Nifty now which was yesterday's high and the recent high of 23,110 which the index has to first cross and then sustain to ensure a move towards 23,400 is what the analysts are suggesting. But as I mentioned, all eyes are on the exit polls on the 1st of June and the election results on the 4th of June. Ruggedges too have come out with their own assessment of how many seats will the incumbent Bharati Jantabati or the BJP will win on the 4th of June. Jant Financial in its bull case is projecting 310 seats for the ruling party which will give them a comfortable majority and a 3rd straight term in office. Now they are advising using any dips in the market to buy and they prefer large caps over mid and small caps due to the valuation comfort that the former is offering. Now at least on Monday when the market was struggling there was some solace that the mid caps, the small caps, the Nifty bank, all of them did well and they stood tall but even they got swept under the selling pressure. Both the mid cap and the small cap index under performed on Tuesday and when that happens it usually is the high flying sectors that lead the downside, real estate, PSU banks and the non banking PSU all of them were the top under performers on Tuesday. So far though for the series the Nifty is up over 300 points, the Nifty bank is up 650 points and a day before the expiry the Nifty rollovers are at 49.2% while the Nifty bank rollovers are at 51.5% while we all countdown to election results there is plenty of stock specific action that is taking place in the market and most of it is due to the earnings reactions which are in the final leg for the season. First up is Adityabila fashion which reported a wider loss compared to last year and that is because of higher interest cost that they had to incur due to their increased borrowings in order to fund the TCNS acquisition. However, the operating performance was strong, the Abitta grew by 47% from last year margins also expanded to 8.3% from 6.5% last year. At the end of FY24 the company's net debt stood at 2,682 crore rupees, however the stock is back in the F&O ban today a day before the expiry and hence no new positions can be created in Adityabila fashion. The other one is IRCTC where there was good revenue growth seen across segments, ticketing revenue grew 16%, catering revenue grew by 34% and even rail near seen a 13% revenue growth. However, there was a substantial contraction in margins for all of these businesses. The ticketing business which sees close to 90% margins that fell to 80% in the fourth quarter. The catering margins also fell into single digits while margins for rail near narrowed by nearly 500 basis points from last year. Amara Raja's revenue went up by nearly 20% from last year while Abitta grew by 16% both the lead asset battery and the new energy businesses grew substantially is what the company said. The strong volume and growth momentum continued in both the automotive and industrial application segments within the lead asset battery business. Amara Raja will be the one in focus today as well. There are plenty of other stocks, NBCC, RR, Cabell, Walkhard and plenty of others that will react to their results that they reported after market hours on Tuesday. In some non earnings names now, Hindalco will be in focus after novellis announced that it plans to sell up to 45 million shares in its IPO at a price band that ranges between 18 to 21 dollars a share. That will mean an equity dilution of 7.5% for Hindalco and will fetch the company anywhere between 6,700 crore to 7,800 crores at the upper end of the price band. Now what Hindalco intends to do with the proceeds remains unclear. There were 5 block deals that took place yesterday and another one is in the offing today that might take place in PNB housing where Asia opportunities Mauritius and General Atlantic Singapore are likely to sell 2.68% through these block deals. That floor price of 717 rupees a share is a 5% discount to Tuesday's close and the deal is likely to be valued at 500 crore rupees. US markets were back in action after Monday's holiday and it was a mixed bag there. The Nasdaq ended at another record high closing above 17,000 for the first time ever. That was powered by who else but another 7% surge in Nvidia. However, the rest of the market was subdued. The Dow Jones shed over 200 points. The S&P 500 ended absolutely flat. The Asian markets have also opened flat but mainly lower. The Japanese and the Korean indices are trading lower. The HangSeng is also trading flat but the Gif Nifty as we speak is indicating a gap downstart for our own markets. So we'll keep that on the back of our minds as well. That's all for today. We wish you a happy trading day and for the sharpest election and exit poll coverage and market insights of course. Stay tuned to CNVCTV18 and CNVCTV18.com [Music] [BLANK_AUDIO]