Markets ended with marginal gains on Monday on back of lower volumes on first day of the year with FMCG index outperforming most of major indices. At present, the Sensex has been hovering at upper end of channel with formation of negative divergence in RSI, this may indicate that the market is prone to profit booking in the coming days. Also, sustenance of India VIX above 14.5 mark is a cause of concern. The higher reading in India VIX suggests aggressive hedges been bought as markets moved higher and this may open wider cracks for broader markets when Sensex closes below 71,483. On the upside, the Service Sector Index has a high potential to outperform as long Sensex defends above the support of 71,483.
Sensex 30 Chart
Stocks to watch
Positive Read through
- Coal India – December production up 8.2 pct, offtake up by 6 pct YoY.
- Power Grid – Gets letter of Intent for 20 GW transmission system in Rajasthan.
- TVS Motor – Total sales up 25 pct YoY, company sees exports to improve further.
- SRF – Aluminium foil manufacturing unit commissioned & capitalised at Rs. 5.36 bn cost.
- Godrej Prop – Acquires 4-acre land parcel in Bengaluru, sales potential of Rs. 10 bn.
- Airlines – Windfall tax on atf cut to nil from Rs 1/litre.
- SJVN – Gets approval to form four joint ventures in India & Nepal.
- Autos – Govt extends auto & auto component PLI by 1 year.
- Kernex Micro – JV gets order of Rs. 1.09 bn from South-Central Railway.
- Gensol Engg – Looks to raise up to Rs 3 bn via preferential issue/ QIP route.
- Adani stocks – As per Gautam Adani, Group’s financial health is now far more robust than ever before in our 30-year history.
- Mining Stocks – India’s mineral output rose 13 pct in October: Government.
- Tinplat – Gets NCLT nod for merger of company into Tata Steel.
- G R Infra – Gets a project in Madhya Pradesh, with annual transmission charges of Rs 419 mn.
- JTL Industries – Q3 FY24 sales volume reached 1,00,905 MT, up by 76.05 pct.
Negative Read through
- Ultratech – Q2 volumes up but lower than expectations, consolidated volumes up 6 pct YoY.
- Eicher Motors – Weak Royal Enfield sales in December, declined by 7 pct YoY.
- Apl Apollo – Q3 sales volume declined by 0.2 pct at 6 lk tonnes YoY.
- South Indian Bank – Q3 business updates weaker than ind growth, deposits up by 2 pct QoQ.
- LIC – Gets GST demand including penalty of Rs. 8.06 bn for FY18.
- Hindustan Unilever – Gets 5 tax notices from different states adding up to Rs 4.50 bn.
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