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00:00Hello and welcome here. Tune in to Closing Trades right here on ETNOW and you are catching
00:08us live from SPI Live Studios and taking a look at the markets. We are seen to be drifting
00:13lower but all throughout the day it's been a race round trading session all in all for
00:19the markets but for now Nifty Bank is also now turned into the red territory. Almost
00:2480 points of cut over there. Almost 100 points of decline coming in on the Nifty 50 and as
00:29we know that it's the IT pack that's the biggest spoil spot today and even the declines on
00:34the IT pack is getting sharper tick by tick. Tech Mahindra, TCS, Infosys, Wipro, HCL Tech
00:40these are our top 5 drags on the Nifty 50 side but on the flip side that's very interesting
00:46to note is that the Adani group of counters have come at the forefront and tried to lend
00:50some support to the market so we were discussing in the morning itself that if the tech heavy
00:56majors are seen to be taking a bit of a back seat which sector or segment rather will emerge
01:01and that's clearly the Adani group of counters. Other than that some of these themes which
01:06have been doing very well case in point being the new age tech companies other than that the
01:11life insurance companies they are once again seen to be lending support for the markets right
01:16now and we can't complain much when it comes to the breadth of the market in terms of the advance
01:22and decline ratio. It's a bit of a tussle that is going over there but yes the number of stocks
01:27that are seen to be declining is higher in number versus the advances but Snehim what are you
01:34spotting right now? Shishti what I'm spotting is not looking all that good because once again almost
01:39a hundred point cut and in fact a hundred point cut coming in on the Nifty 50 right now four
01:43times of a percent lower and we seem to be falling further from those levels as well.
01:47Sensex two half a percent lower it's actually India wicks a four percent uptick and this is something
01:51that we've seen after quite a while for India wicks so at least some movement over there.
01:56Nifty bank two not as low as the benchmarks but still almost a two-tenth of a percent cut in the
02:01red is what the Nifty bank is seeing. Shishti like you were highlighting some Adani group of stocks
02:06all eyes are actually on Adani power today locked in upper circuit of 20 percent as we speak remember
02:11one is to five stock split is something that we've seen on the stock today and the stock is
02:16trading X stock split. Other than that we have reports saying GQG has sold some Adani power
02:21shares to SPI mutual fund and some other buyers amid this stock split. So on the back of that Adani
02:27power 20 percent upper circuit is what we're seeing and ever since that sebi clearance on the Hindenburg
02:32allegation has come from the on the Adani group of stocks they have been on the tear. Adani power was
02:38the top Adani group gainer on Friday as well continues to move that trend ahead and you also have Adani
02:45enterprises sports from the Adani group doing well but let's take it across to my colleague Ayesha who's
02:49joining us live from the JP Morgan 10th annual conference. Ayesha.
02:53Well thanks for that and we're almost closing down on day one at the JP Morgan conference here in Mumbai
03:12and who better than James Sullivan himself right here with us to give us some color on how day one has been
03:18and what's lined up for day two as well James welcome to ET now. Quite intrigued to know what are the
03:25questions about India there's so much push and pull happening with us at both ends.
03:30No as you very rightly say I think it's a very unique time to be looking at the Indian market
03:35for a couple different reasons. On the macroeconomic side there are statistics really pointing in both
03:40directions. From a markets perspective though I think that the outlook is a little bit clearer.
03:44The nice thing about markets is ultimately it's about pricing in various versions of the future.
03:49At the moment because of significant market underperformance relative to the rest of Asia
03:53because of currency underperformance but also critically as we're discussing prior to the
03:58program the fact that earnings expectations have been significantly reduced. We're at a stage where
04:03we think entering the Indian market from an equity perspective right now makes a lot of sense.
04:07The risks are skewed we would argue asymmetrically to the upside because expectations have been lowered
04:12significantly. What is the data of disruption in the price?
04:16I think it is. If you look at how the tariff disruption potentially filters through the Indian economy
04:21there's a couple things to think about. So the headline is 50 percent. If you adjust for excluded items
04:25however you're sitting at 34 which is still a relatively high number but not nearly as high as the headline
04:30and then if you look at the opportunity for Indian companies to diversify and relocate those exports over time
04:37we do think that the economy has the ability to adjust and to stomach
04:41some of the impact. The other reality however though is that the Indian economy is far less exposed to export
04:47as a driver of the overall economy at least on the good side relative to most of the rest of Asia
04:52and so on a relative basis if we're trying to understand the impact India actually looks reasonably good
04:57because goods exports are not the driver of the economy. It's really been the services side that has been most interesting.
05:02I would look at it a little bit the opposite way actually. I mean if you think about it very very simplistically
05:13you've had two decades where foreign companies have hired Indians and moved them to the US.
05:19Now they'll hire Indians and leave them here in India right like JP Morgan has 20,000 people here in India
05:23and so the argument that this fundamentally changes the nature of the services conversation in India I disagree with.
05:30It might change some element of the exportation of services but if that requires more Indians hired and left on shore
05:36that's not necessarily bad for anybody.
05:38That's a model for anyone to look at as a US company and others?
05:43So two components to my answer. Number one the idea that the world will continue to leverage India as the office of the world
05:50I think is still a very compelling conversation and drives a lot of investor interest in this market.
05:55The other side of the equation is the devil is always in the details and at the moment we have almost no details
06:00in terms of the implementation of this policy in the United States.
06:03And so we'll have to see how this actually rolls out in practice versus in tweet or headline.
06:08But the overall message is that we think that India as the office of the world is still a very compelling thematic moving forward.
06:14James, as this disruption plays out, either where Indian companies set up shop in the US
06:23or a lot of the Indian workers who were in the US set up shop back here
06:30that disruption is going to come at a cost
06:32and that's something that the equity markets would have to factor in in a jiffy.
06:36So if I'm building an India portfolio right now, what should be my sector overweights, underweights, so much flux, how do I price that all in?
06:46Sure, I think so the easiest way to construct an overall India focused portfolio right now, at least from a JP Morgan perspective,
06:52is to really key into demand that is driven by domestic forces and storylines that are more under control of the Indian government
07:00or Indian corporates than exposed to international decisions over which we don't know what's going to happen.
07:05And so if we think about the fact that we just saw a very good second quarter calendar year, first quarter fiscal year here in India, GDP print at 7.8%.
07:15JP Morgan's taken up our full-year economic growth forecast off that print.
07:19Monsoon, as we can see outside today, doing quite well, 7% ahead of historical averages.
07:24Stretch there, stay.
07:25Exactly. Well, you never know. That plus the typhoon in Hong Kong. People might be here for a while.
07:31The point, though, is that you see multiple drivers of incremental demand, particularly in rural India, which is a core line of analysis that we've continued to focus on.
07:41So you have a combination of a better-than-expected monsoon, reasonably good macroeconomic backdrop, paired or tripled with the GST rate cut that the government just pushed through.
07:51You have multiple idiosyncratic drivers of rural demand, consumption demand here in India, that have nothing to do with the broader trade conversation.
07:58And so really keying into those sectors, so consumer staples, consumer discretionary, financial services, is something that we've been very focused on.
08:05The foreign flows, which are actually negative for us, you know, and you've listed a lot of positives which are coming in with respect to consumption, with respect to, you know, the models that could go for services and others.
08:20When do you think global funds are going to look at India as one of the countries?
08:24Great question.
08:25And they haven't been slightly negative.
08:27They've been $23 billion negative for FIIs over the course of the last 12 months.
08:31And so that's a big number.
08:33The critical element from our perspective is always watch where the market starts.
08:37And if I look at Asian market performance this year, you have India being a dramatic underperformer after relative periods of outperformance historically.
08:45You have the Korean market up 50% after a truly abysmal 2024.
08:50And so that starting point is absolutely critical.
08:52And so you've seen the sell down by foreign investors.
08:55Why did that occur?
08:56You had a confluence of India becoming relatively expensive relative to regional and global peers at the same time that you saw a stalling out in terms of earnings forecast revision.
09:06And so we had actually downgraded the Indian market too early, in hindsight, off the back of that downward revision in corporate earnings.
09:12Now that revision cycle, we feel, has bottomed.
09:15And so the street's already sold.
09:17Valuations are now regionally attractive.
09:19Earnings expectations are eminently beatable, which is a very strong setup for incremental performance.
09:25So, you know, if you look at the valuation, the relative valuation has remained the same.
09:29It's the Asian valuations which have gone up, right?
09:32Exactly.
09:32In that sense.
09:32So, from a foreign investor's point of view, how do you look at this entire thing, even if India is underperforming the Asian markets in that?
09:42So the valuation conversation in India is a slightly longer one.
09:46But I think the fascinating aspect of it, ultimately valuations are premised in the value of money.
09:50And the differential conversation here in India relative to a lot of markets around the world is the fact that you're seeing a structural reduction in the cost of money in India as interest rates have started to structurally come down.
10:02And we had the deputy RBI governor on stage talking about this earlier.
10:05That arguably sets the stage for a higher overall valuation metric here in India.
10:10And so one of the things that we caution investors about a lot is now relative to 10-year historical average.
10:16I don't really care because that average was based in a set of macroeconomic and microeconomic statistics, which may or may not be relevant today.
10:23And so if I look at India's relative valuation to the U.S., to other markets around the world, where you're seeing rate structures go up versus rate structures here go down, that absolutely matters in terms of those relative valuations.
10:33The domestic flows is playing a big, important role.
10:36And it's not allowing your valuations to come down either, right?
10:38Absolutely.
10:39And so you've seen $23 billion in FII outflows.
10:42You've seen, I think, it's $93 billion in inflows.
10:44Now, why isn't the market up off of that differential?
10:46Because a lot of that has been soaked up by new issuance.
10:49But, again, that's a very positive side for the Indian economy.
10:52It's a very positive sign for the maturation of Indian equity markets as the broader segment of the Indian population starts to participate and really benefit from the upside in the overall market.
11:04But, James, if I were to just sort of zoom out of India and look at the whole globe as a picture, you think the trump card, and no pun intended here, lies in the way the dollar is going to move?
11:14Or is it going to be more about Fed action?
11:17So they're interlinked by definition.
11:21I think if we take a step back here in Asia for a second, one thing that we haven't talked about is there is a reality in Asian markets where it is very, very rare for both India and China equity markets to work at the same time.
11:33And so one of the dynamics that we very frequently see is this rotational trade within Asia.
11:38The reality is China got very cheap.
11:41You started to see positive earnings revisions.
11:43You started to see policy impetus across a range of sectors that has driven significant outperformance for Hong Kong, China, A, H, et cetera.
11:52Now, to some degree, that comes at the expense of India, as you saw this rotational trade kicking in.
11:56Now we're at a situation where China has outperformed, India has underperformed, expectations have gone up, expectations have come down.
12:02Again, one of the things I love about my job is this search for asymmetry.
12:06And we really feel that that's started to come to the fore here in India right now.
12:10And how the exchange-traded funds have been invested into China, Korea, and other Asian countries?
12:15Do you see a reversal of trade happening at that?
12:18Well, we'll have to see.
12:19From a broader asset allocation perspective, one of the key dynamics that we see on the ETF side is really this dynamic where ETF fund flow comes into a market.
12:27And this has been true here in India as well.
12:29And it effectively floats the top end of the market away.
12:32And so if you look at the valuation gap between large caps and mid and small caps in a lot of Asian markets right now, that's gapped out because of the ETF flows.
12:40The dynamic that we pay attention to here in India is from a research coverage perspective, we're seeing a significant broadening of investor interest past the mega caps and into the mid and small cap space.
12:51And so we're expanding coverage here in India.
12:53We're actually making two offers this week for incremental analyst hires and continuing to invest in this market.
13:10Confused by the studio and while we're talking about the texture of the market, it's not looking optimistic at all because we continue to fall 24,217.
13:21In fact, okay, we have slipped below that 25,200 mark too.
13:24So that's a sharp cut coming in from the day's high coming in.
13:27Half a percent cut over there.
13:29A cut has intensified on Sensex as well.
13:33India Weeks up 6%.
13:34Now, Kunal, this spike in India Weeks.
13:36Remember, just last week, we were in fact talking about how the India Weeks has been absolutely stagnant, not moving at all.
13:43And today, this H1B news flow is all it took for India Weeks to finally show a spike up.
13:48Yeah, so I think today it's on the back of news plan.
13:50You know, the week has to rise generally when the sentiment suddenly gets spooked.
13:54And that spooking of sentiment happens when there is news flow which is attached.
13:57It doesn't happen on a very, you know, a market which is devoid of news flows or any kind of a major event.
14:05So I think in that aspect, you know, today's rise in the weeks gets justified.
14:10But then I think the movement of the markets today, you know, this down 150-odd points for the NFT is not just on the back of, you know, the rise in the India Weeks.
14:19It's also, I think, you know, some underperformance which has come out from sectors like financials or banking specifically in private sector banking names.
14:28I think that's a sector which is underperformed.
14:30So, you know, we were discussing this in the morning that if the markets have to balance out, then if IT sector opens with a gap down opening, you might have other sectors trying to play the lead and trying to at least, you know, cover the underperformance which could be there.
14:43But that, you know, that part was played for the first half where you saw the bank nifty remaining above that 55,700, 600 plus mark.
14:52But then I think from the second half itself, you saw some selling pressure which come back into the private sector banking names specifically.
14:58So, I think maybe the markets are just about indicative that we are not heading towards any kind of a major breakdown or breakout or breakdown as such.
15:06And we could just about trade into this 500-point band for the nifty.
15:0925,000, 25,050 as a support and 25,500 broadly as a resistance for the index still remains.
15:15All right.
15:16So, if at all, we are off the day's highest point.
15:19That is indeed what we are getting to see.
15:22But along with that, the markets are expected to be quite range bound is what Kunal is highlighting.
15:26But with this, let me also welcome on board Ruchit Jain on the show right now.
15:30Hi, Ruchit.
15:31Good afternoon.
15:31And what do you make of the markets, Ruchit?
15:33Because it's a bit of a U-turn by the markets.
15:35But along with that, heavyweights like Reliance and HDFC Bank, they are also down.
15:40Yeah, very good afternoon.
15:44Yes, very good afternoon.
15:45Well, we have seen a good run-up in the last three weeks in the market from the lows.
15:50If you look at the nifty index, it says then a move from 24,400 to 25,000.
15:56It was seen without any pullback or correction.
16:00So, I think the things on the low, with overbought zone, and this is leading to this pullback move that we are witnessing.
16:07While this does not change the immediate trend for the market, but definitely indications are that some sort of short-term pullback is there in the market.
16:14So, we are advising, you know, traders to keep a buy-on-dip approach and any decline towards the 25,100, 25,050 range, you know, would be a good support to watch out for.
16:24So, I think, you know, this is just a correction within an uptrend.
16:27And any declines towards the support, whether in nifty as well as in bank nifty, should be used as a buying opportunity.
16:32Okay, so buy-on-dips and those are the levels to watch out for.
16:36That's the word coming in from Ruchid.
16:38But on that note, we'll slip into a way short break and be back for more on the other side.
16:41And the kind of cuts that we've seen on the market today, we have Kunal and Ruchid both back with us.
16:59But Kunal, let me first come to you and let's talk about sectors.
17:03Now, not much in the green right now.
17:05But at one point of the day, you did have the entire real estate pack that was holding on to the shade of green.
17:10And doing very well for itself on the back of this GCC opportunity that we're hearing now that a lot of tech jobs could be moving back home.
17:19What's your take on real estate and particularly Anantraj as a stock?
17:22Because remember last week when that data center boost came from the government, the stock was up.
17:26And today yet again.
17:28Yeah, so I think Anantraj is a different league altogether now because it's not just about real estate.
17:32I think, you know, the stock has diversified itself.
17:34So, I think in that sense, it's just charging a lot of premium.
17:37And the power performance over the last couple of days has been very, very stellar for Anantraj.
17:42And I think this was also due in some aspect for the stock price.
17:46Because I think the correction which happened for Anantraj, if I'm not wrong, 800 or 900 was the high for the stock in 2024.
17:53And from there, the stock had fallen down to almost 40, 50 percent.
17:56So, you know, somehow, you know, the stock which was a very high beta stock and had a tendency of participating very well with respect to the overall market trends over the last many years.
18:05That was a missing feature for the stock price.
18:07So, it's just trying to get back into the alignment.
18:11And if I can just put maybe one more example, the Adani group of stocks.
18:14Even these stocks were out of sync for the last many months with respect to the overall market.
18:20So, I think now the flavor is coming back for the markets with respect to these two, you know, interesting pockets.
18:26Yes, I think in terms of sectors, real estate, you know, space definitely looks very attractive even at current levels.
18:32The only catch over here is that, you know, there are many of the stocks which are still trading below their long-term averages.
18:38I was actually looking at the charts for DLF, Orbiter, Realty, etc.
18:41I think many of these stocks are still trading below their long-term averages.
18:45So, when you have such a kind of a setup where there is a base building which is happening, but these, you know, stocks are still trading below their long-term averages, you have to take it step by step.
18:53You know, initially, we look at, say, 50 DMAs or 200 DMAs as the first set of targets for the stock prices.
18:59And then, based on the volume patterns, the urgency of the stock prices, moving above those key averages, that's where we determine that whether we are looking at a major trend building or not.
19:07So, as of now, I would look at maybe a phase one of the market, of the rally for the real estate stocks.
19:14DLF, Prestige, Orbiter, Realty are the three names which fit in that category.
19:18All right, that's the take coming in on the real estate counters.
19:21Let's watch out for that.
19:22But with this, let's also get you some of the tradable ideas from both of our experts.
19:25And, Ruchid, you go first, tell us which is the BTST or STBT idea you have for our viewers.
19:33A couple of names, you know, that we like in such market where our performance could be seen.
19:38You know, first is Adani Group stock, Adani Ports.
19:41Like we have seen in last couple of trading sessions, you know, the entire group has witnessed good price.
19:46Adani Ports is one stock which is quite close to 52.8 high, indicating that, you know, in the recent past,
19:51is that when the entire group has shown a relative underperformance, the stock has shown a good relative strength.
19:56So, I think Adani Ports is one stock where the risk reward issue is still favorable at current levels.
20:01I would recommend to go long with stock loss below 1420.
20:04And if we see an upside in the near term, that it could rally even towards 1550 in the short term.
20:10So, I think Adani Ports is one stock which we would recommend.
20:12And Bank of Baroda is my second recommendation over here.
20:15So, primarily, the entire PSU banking space, if you see after a consolidation of about three months,
20:20I've seen a good breakout in the last three or four trading sessions.
20:24Bank of Baroda also, whenever it was coming around 248, 250, it was witnessing selling pressure.
20:30But, you know, the range has been broken out on the upside.
20:32So, we are quite constructive on the PSU banking space from a trading perspective,
20:37within which Bank of Baroda is good on charts.
20:39So, one can go long there too, keeping stock loss below 242 for potential targets around 267.
20:46So, Adani Ports and Bank of Baroda are two stocks looking good to purchase right now.
20:49Kunal, what about you?
20:50What's looking appealing in a market that's largely falling?
20:53See, I think in this kind of a market, it is very important as a strategy to lower the beta of the stocks
20:58which one is looking at in terms of buying.
21:00So, in that aspect, I would suggest to buy calls and large cap names which are low beta.
21:05The first one is ONGC.
21:07That's a chart which is looking attractive.
21:09The stock is heading towards a breakout, I think, of a 50-day moving average.
21:13If I'm not wrong, this is a breakout.
21:15This could be a breakout potentially if the stock closes above the 50 DMA after almost
21:20two or three months of the stock trading below this key medium term moving average.
21:24So, that I believe could be an interesting feature for a stock like ONGC.
21:27We would look out for targets in the range of at least 243.
21:30Stock loss could be kept at 235.
21:32And the second would be a buy on Grasim.
21:34In a very similar way, I think Grasim is also showing signs of a potential breakout
21:38on the short-term consolidation charts.
21:41The breakout point is closer to that 2885, 890.
21:45So, if the stock happens to cross back about 2885 and closes above this level,
21:50that's where I would suggest the buy could be triggered for Grasim.
21:53Look out for targets in the range of 3000 and stock loss could be kept at 2830.
21:58All right.
21:58So, those are the buy calls coming in from both of our experts.
22:01Let's watch out for that.
22:02But along with that, one of the pockets that has done very well
22:06is actually the Adani Group of Counters.
22:08Wherein you see, majorly all the stocks are on fire today.
22:12And that's a made a buzz.
22:14As reports suggest that GQG has sold Adani Power shares to SPI Fund and Citadel Securities.
22:21My colleague Rabinder joins in with more details on the Adani Group of Counters.
22:25Rabinder.
22:26Well, as an entire Adani Group stock is in focus on the past few sessions.
22:30And there are many key triggers for this rally.
22:33First is, GQG has sold Adani Power shares to HBI Fund, Citadel Security, worth of USD 250 million last week.
22:42And there are a few growth triggers for the Adani Group's companies going ahead.
22:46First is, Adani Group's debt-to-Ebita ratio at group level has come down from the past few times.
22:52And India Rating Agencies has upgraded the Adani Group's stocks.
22:57And Hindenburg's case has overrun has done.
23:00And access to longer, 10-year, cheaper capital would be there.
23:03And the strong revenue profit, the company's Adani Group has a strong revenue profitability for next 25 to 50 years.
23:10And all sectors of the Adani Group's company are linked to infrastructure.
23:14And India's infrastructure story is long way to go ahead.
23:17And if we talk about the debt-to-service coverage ratio for Adani Group, then in FI 25, it was 2.5.
23:22FI 24 was also at 2.5.
23:26And for FI 25, it came to at 2.6.
23:29But in Q1, FI 26, it came at 1.8.
23:33And if we talk about the stock performance of the Adani Group's in the last two days, then the Adani total gas was up by 24%.
23:39And Adani Green was 13%.
23:40And Adani Enterprise stock was up by 8% in the past two trading sessions.
23:44And if we talk about the capex plan of the Adani Group's company, talking about the Adani Enterprise,
23:50then Adani Enterprise capex plan plan is 31,838 crore.
23:55And for Adani Port, it is 8,350.
23:58And if we talk about the group levels, capex of the Adani Group, then the Adani Group has a capex plan of 15 to 20 billion dollars for next five years.
24:08And if we talk about the 12-month return potential of the Adani Group's company,
24:12for Adani Port, the target price is 1,708 with return potential of 18%.
24:16For Adani Enterprise, it is 3,000 with return potential of 14% for ACC, 2,127 target price.
24:24And for Adani Power, it is 141 with return potential of minus 17%.
24:29Rabindar, thanks for taking us through that.
24:32So, the Adani Group stocks are in focus, like Rabindar was mentioning.
24:35Big gains coming in on Adani Power, Adani Total, Adani Green, all of these.
24:40And of course, Adani Energy Solutions as well.
24:42All of them looking very good.
24:44Anywhere between 7% and 20% upper circuit is what we're seeing on some of these stocks.
24:49But let's take the market conversation ahead.
24:51Get a check of where the markets are headed, what is looking good,
24:54and mainly what should your navigation strategy be amid a volatile market like this.
24:59We have Mayuresh Joshi, Head of Equity at Marketsmith India, also joining us on the show.
25:04And Mayuresh, hi, good afternoon and thanks for your time today.
25:06And give us a sense of just that, right?
25:08The kind of volatility that we have once again seen seeping in the market right now,
25:12given the kind of sector churn we've seen.
25:15Of course, our viewers or anybody rather would be tempted to buy, given the fall we've seen.
25:19But which sectors are looking good right now?
25:22And how do you gauge where the sector churn could be headed next?
25:26Very good afternoon.
25:27Now, again, I think the entire emphasis will be on consumption and growth.
25:31So I think both the engines in terms of the GST rationalization moves that have largely taken place
25:37would reflect in better volumes happening across both consumer durable as well as consumer distributionary.
25:43And at the same time, the government CAPEX, along with private CAPEX, which has seen green shoes of coming back,
25:49would largely mean that growth capital might be required for a whole host of domestic projects
25:54as far as manufacturing or infrastructure growth is concerned.
25:57Therefore, we remain extremely optimistic in terms of quite a few segments within all these spaces that can continue doing well.
26:04Within consumption as a basket, our own sense is hotels as a space should continue doing well.
26:11FMCG selectively, where volume growth should emerge very, very strongly,
26:17should emerge as a very strong earnings contender,
26:20where earnings should come back very, very strongly as we start hitting Q3.
26:25Within the sub-segments of consumption,
26:29footwear and domestic capital makers might actually continue doing well.
26:32Since infrastructure manufacturing because of private and public CAPEX might be also something on the agenda,
26:39I think select and BFCs can continue doing well, in our opinion.
26:43For infrastructure and manufacturing, I think the sub-segments like cement,
26:49where the expectations of reasonable volume growth coming through,
26:52consolidation that we've probably seen for the industry itself will mean better dynamics
26:57as far as pricing is concerned.
26:59Because of a lot of cost efficiency is built in because of internal power,
27:04captive power users as waste-tease recovery plants as well,
27:08along with more sanguine logistic requirements that have got built in,
27:13along with cheaper input costs,
27:15reported EBIT and EBIT upper time as we headed to Q3,
27:18will be relatively better.
27:20So, in our own sense, I think selective sectors, as I mentioned, can continue to lead well.
27:26And again, I think the entire focus in terms of both consumption and investments coming back
27:30might actually propel earnings to probably hold up as we begin Q3.
27:35Therefore, from a market standpoint, as we see it in markets with India as well,
27:39the distribution day count is at one.
27:41And therefore, I think as numbers start improving in Q3,
27:44Q3 will always be a little bit soft because of the monsoons and the seasonal week quarter
27:49that is always expected.
27:51But commentaries might hint to better numbers coming through Q3 onwards,
27:55which will give the much-needed impetus for the markets.
27:59And in all probabilities, if we remain in a confirmed uptrend,
28:02we might actually hit all-time highs before we are in this capital.
28:04All right, that's the take on coming in on select consumption names.
28:10But the next-gen GST reforms are transformational.
28:13Those are the words coming in from ITCCMD's Sanjeev Puri
28:16in an exclusive chat with ET Now.
28:18He adds that this move will boost consumption, employment, and drive economic growth.
28:24Listen in.
28:27Transformative reform.
28:28It's going to make good quality products accessible.
28:32Prices will go down for every consumer.
28:36There will be a lot of savings for consumers.
28:38I think we should all celebrate that.
28:41And it's also, you know, backed up by simplification
28:45that will improve the ease of doing business.
28:48And at ITCC, we are all committed to passing on all the benefits to the consumer.
28:51Sir, can GST 2.2 spark a new cycle of demand in the economy?
28:56Yes, absolutely.
28:57It's going to fuel consumption.
28:59And therefore, investments and leading to employment.
29:04So, it's going to set in place a virtuous cycle.
29:06It's a start of the festive season as well.
29:09So, how this move is going to positively impact the overall demand cycle?
29:14It will be very positive.
29:16It will be very positive.
29:17And I congratulate the Honorable Prime Minister for his vision and direction to get this week done
29:25because it's truly transformative and it's going to have a very significant positive impact on the economy.
29:33That was the exclusive word coming in from ITC's Sanjeev Puri.
29:37But we also caught up with Sanjeev Mehta, the Executive Chairman of El Catat in India
29:41and former Chairman and CEO at HUL.
29:44And he shared his views on the GST rate rationalization
29:48and how he believes it will aid consumption and premiumization.
29:51Let's listen in.
29:52There are no categories in India which are anywhere close to maturity.
29:59You can get growth by increasing penetration or getting more consumers.
30:04You can get growth by increasing consumption.
30:08And you can get growth by premiumization.
30:11Now, premiumization has been a secular trend.
30:16We must remember that India for the last 30 years has been growing at a carger of 6, 6.5%.
30:22And if you look at the nominal growth, it has been growing at about 10, 11%.
30:26So, you have more income and certainly more income at the top of pyramid
30:31and everyone wants higher order benefits.
30:34So, premiumization as a trend will continue for years to come.
30:38Yeah?
30:38Yeah, but increasingly, when you have more income at the hands of people,
30:43the consumer's behavior also changes to give you some insights.
30:48You know, when times are tough, in households at the bottom of pyramid,
30:53they would have one toothpaste or one bar of soap in the bathroom for all the family members.
30:58When things become better, when things become more affordable, when the incomes go up,
31:03they would be having a bar of soap for every member of the family as per their choice.
31:07Similarly, it goes with the toothpaste.
31:10So, it does lead to more consumption.
31:13And I think the government has done a fabulous job of bringing down the rate of most of the items to 5%,
31:20which should give a fillip to consumption.
31:24There is no doubt about that.
31:26Indeed, GST is expected to give a fillip to the consumption.
31:30But let's hear out from the corporate itself, what does this GST reset mean for the growth ahead?
31:36We spoke with the management of BKG as well as GCPL.
31:39Let's hear them out.
31:40The simplification in the structure overall, we're also helping doing ease of business in India across.
31:47And as a business, as a brand, we are committed to pass on completely.
31:52Like in family pack, we serve a two pack, family and impulse pack.
31:56So, all the bigger packs will have reduced MRP from today.
31:59So, we'll be passing on completely to the consumers.
32:02So, overall, from marginless, we don't see any major improvement due to GST cut.
32:06But, yeah, overall, we see good volume growth coming in after GST cut.
32:10Because as rightly said, we see organized sector going more stronger in future.
32:15And that will help all the organized industry.
32:19About 35 to 40% of the portfolio is impacted by GST.
32:26Which is not a bad thing because after a certain point, you get into an inverted duty problem,
32:31which, you know, 35 to 40 is a good amount to be at 5%.
32:38I think the category growth will inch up by a couple of percent.
32:41But it will not inch up, it will not go up by 11%, which is the extent of price drop that all of us are giving in GST.
32:46It's very hard for us to judge what's going to happen in Q2 because these are unprecedented transitions.
32:52And often, there are all sorts of issues that go on in transition.
32:55So, it's very hard for me to predict what will happen in Q2.
32:59We'll only know in the next 8 to 10 days.
33:00But I think chances are things will be volatile, which way I don't know, but they'll certainly be volatile.
33:06Going into Q3, we are quite bullish because GST is a fillip.
33:11And you must remember that last year in Q3, probably driven by food inflation, FMCG and consumption in general, had a tough time.
33:20So, you're really coming off a tough quarter and you're going into a good quarter.
33:25So, I think all of us are really hopeful about quarter three.
33:27Okay, so that's the word coming in from the managements of BKG and Goldrich Consumer Products.
33:34Mayurish, taking this GST conversation ahead, you know, we've been talking to a lot of white code managements and consumer durable companies.
33:43And they're optimistic that this GST cut could make up for the kind of losses they've seen due to the early monsoons.
33:50Do you think that is something that could be possible or how long do you think GST benefits would take to start showing up as positives in the company financials?
33:58Of course, I think most managements are alluding to the fact that an evident volume picture will be only visible in Q3.
34:07And thereafter, I think it all really depends on how the demand dynamics stick out.
34:12Having said that, I think in terms of consumer durables and structurally, I think if you probably look at white codes as a segment,
34:19they're talking about ACs, refrigerators, washing machines, microwaves as an example.
34:24I think that entire ecosystem might see some element of growth coming through.
34:28And that might be prima facie in terms of urban and semi-urban areas where a large part of this growth will come through.
34:35The income tax rationalization which has happened, which will again start paying out very, very effectively with GST rationalization coming through.
34:43I think there might be an added incentive to probably go out there and spend.
34:46And therefore, I think a lot of management seem very, very optimistic.
34:49And therefore, I think visible results will only be seen probably in Q3.
34:52Having said that, I think the expectation largely in terms of how much of an impact can it create in terms of volumes?
35:00And therefore, all our numbers when it comes to top line, including margin expansion and bottom line growth, I think Q3 will be a base for that.
35:07Having said that, again, I think Blue Star is something from the AC segment which has done well.
35:12A proxy to this might also become something like an Abel's, which can probably have some element of sale, both in terms of the audibles, as well as creating the necessary impetus that it probably carries through in terms of its core business.
35:25All right. So, that's the take coming in on select white coat companies.
35:30But along with that, Ruchit, just wanted to have your take on select tire counters.
35:35Because today morning, we were speaking with the management of Seattle, where they were quite optimistic about the demand going ahead, not just the replacement, but also from the OEM side.
35:45That's expected to do well.
35:47And all in all, in this auto rally, the tire counters haven't participated much.
35:52But Ruchit, amongst Apollo tires, SEAT, Balakrishna Industries, if I ask you to pick one, what will that be?
36:01Yes, I think the segment as a whole, if anyone is looking for some positional picks, then one can look for tire sector, where the rural structure seems to be positive in some of these names.
36:10But if I were to pick one amongst these, then Apollo tire would be preferred one.
36:14The stock has recently seen in price a point of breakout above its immediate hurdles, which was around 460, 470.
36:21And if you look at the price structure, that then is a higher top, higher bottom formation, along with the rising volumes.
36:26The stock is even not breaking its 50-day exponential moving over its support if you look at recent short-term charts.
36:32So, overall, I think this phase should do well.
36:34And within this, Apollo tires, in terms of risk-reward ratio, is much favorable over here.
36:38So, one can look to create fresh longs and Apollo tires at current levels.
36:43So, Apollo tires looking good.
36:44And create fresh longs is the word coming in from Ruchit.
36:47But, Kunal, you know, we also spoke with the management of JK Cement early in the morning today.
36:53What's your take on some of the cement counters?
36:55Because JST has also significantly reduced on that pack.
36:58But your pecking order, Amit, that's great.
37:00So, it's a space which has done just ok-ish, I would say, you know, on the price recovery.
37:05Even for JK Cement, for example, in the last four or five days, we've seen a pickup of 300, 400 points, which is largely 3%, 4% in the stock price movement.
37:14So, I think in that sense, from 6,400, it's moved towards 6,800, 6,850 mark.
37:19Mild recovery coming back into the likes of ACC, Ambuja Cement.
37:22So, maybe I think it's just about a very tepid rally.
37:24Difficult to pinpoint the outperformers or the outliers over here.
37:28Because, as of now, we are still into a phase where the sector is going through a very tepid recovery.
37:33Maybe I think Grassim, you know, you can also look at Arttech Cement.
37:37These are the two names which are, which have generally been leaders or strong performers in terms of the cement pack.
37:44So, maybe I think these stocks could be better placed with respect to the other pairs.
37:47All right. So, that's the take coming in on the cement counters.
37:52Let's watch out for that, which along with that on the bottom of your screen, you will get to see that it's at SEBI that has issued a consultation paper on technical glitches in the stock broker trading system.
38:01The framework first issued in November 2022 is now under review after the industry feedback and the circular to take effect from November 1st, 2025.
38:11That's the big news that we are getting to understand from the SEBI front.
38:16It's a new consultation paper that has been issued with respect to the technical glitches.
38:22But this is applicable on the brokers who have 10,000 or more clients as of now.
38:28But along with that, Mahirish, just wanted to have your take on select exchange-related counters.
38:33Off late, they have been very volatile on the back of the kind of news flow and the F&O adjustments, how the volumes are expected to get a hit.
38:44But what's your sense on the exchange-related counters as of now, Mahirish?
38:49I think we'll have to give it time, right?
38:50Because I think with all the regulatory changes that are now transpiring as we speak, it really depends and it's to be seen what kind of an impact does that really have in terms of the overall volumes as far as these exchanges are concerned, both BSE and the data that we'll get from NSE as well.
39:07And therefore, I think equity-linked exchanges might actually have some element of softness embedded in Q2 based on all these factors put together.
39:16And what does the consultation paper actually tell us in terms of weekly expiry, whether it's going to be fortnightly expiries going forward?
39:23I think nobody's thought about that.
39:25So I think wait and watch on that.
39:26In fact, out of the exchanges, MCX in terms of ratings and rankings probably looks a little bit better placed.
39:34The expectation in terms of more contracts coming through MCX's way might actually pay way for more stability in earnings as we speak.
39:42The gold and the silver futures, which have probably got launch options, which is still a large part in terms of the average daily turnover.
39:48The balance sheet probably looks very, very strong.
39:51They've got very strong EBITDA margins, as we speak, in excess of 70, 71% and therefore I think more institutional participation is one that reads through in terms of the commodity exchange,
40:01the kind of leadership that the stock probably carries as far as a large part of the contracts are concerned, whether it's gold, silver, crude, factual gas,
40:11which becomes a more important and a prominent part in terms of the average daily volumes,
40:16might actually mean that if all these initiatives are taken up, it might be better volumes and marginal property sustain, which means better water-planned growth.
40:25So, out of all the exchanges at this juncture, MCX probably seems to be a tad bit better placed.
40:31Indeed, and of late, the stock has been seeing decent moves as well.
40:36But Kunal, there's been no stopping in the gold and the silver prices as well.
40:40MCX is indeed one of the beneficiaries, but one of the other pockets is the gold finances companies.
40:45No stopping on that front as well.
40:47Take a look at Manapuram and Mutut.
40:49Even on this day, the stocks are doing so very well.
40:53What's your take on that, Kunal?
40:54How much more headroom is there?
40:56Yeah, I think till time, the gold prices, they keep on rising up higher.
40:59I would believe that there could be a chance that the gold financiers, they could stand to outperform.
41:05And, you know, even on the dollar terms, for example, for the gold prices, I don't see a major cool-off happening, at least as of now.
41:12My expectation is that I think we should at least come close to that $4,000 per ounce mark or maybe break past about those levels on the gold prices.
41:22So maybe I think in that context, there should be some side left for the gold prices over the short term.
41:28So, yeah, even from a short-term angle, the likes of Manapuram Finance, etc., they would be considered more as a buy-on-dips approach.
41:35All right.
41:35Buy-on-dips could be the strategy when it comes to gold finances.
41:39But, Ruchit, if I can have your closing comments, the kind of closing that we are getting to see, Nifty 50 is exactly at that 25,200 mark, while for Nifty Bank as well, 152 points of decline.
41:54Where do you see the markets open for tomorrow?
41:56What's your analysis there?
41:58So, I think considering that last half an hour or last one hour, we have seen some selling pressure, we could see a soft opening in follow-up homes tomorrow.
42:07But definitely, if we get some kind of negative opening towards that 25,100 of homes, then such a kind of negative opening could then be used as a buying opportunity.
42:18So, price-wise downside seems to be limited from here on.
42:21I think it's just that time correction could happen in tomorrow's trading session.
42:25So, some consolation could be expected.
42:28That's all for that.
42:30But with this, Mahiresh, Ruchit, as well as Kunal, thank you so much for taking the time out and speaking with us.
42:35Just a few minutes left for the market to shut shop.
42:38And let me hand over to Snehi to tell us how did the markets pan out today.
42:42Snehi.
42:43Well, absolutely, Shristi.
42:44Let's take a look at the kind of tumultuous moves that we've seen in today's trading session.
42:48Very marginal recovery coming in from the day's low.
42:51If you take a look at the Nifty 50 intraday move, 25,205.
42:55Looks like we might just close above 25,200.
42:59But still a minute and a half left.
43:00So, let's see what happens on that front.
43:02But nonetheless, a half a percent cut coming on the Nifty 50.
43:05Half a percent cut coming on the Sensex as well.
43:08Nifty Bank has done slightly better than the benchmarks.
43:10But still a three-tenths of a percent cut coming in on the Nifty Bank as well.
43:14It's actually the broader end of the market that's marred farther.
43:16Six-tenths of a percent cut coming in on the mid-cap space and more than a percent cut
43:20coming in on the small-cap space, which has continued to be the outperformer for quite
43:26a few sessions in the past.
43:27But that has reversed entirely today.
43:30In terms of the Nifty gainers and losers, all eyes were on the Adani group of stocks today.
43:34Adani Enterprises is your top Nifty gainer.
43:37Even other than that, Adani Power, Adani Ports, Adani Green Energy, Adani Total, all of these
43:44stocks have done very well for themselves.
43:46Eternal, Bajaj Finance, Ultratech, Adani Ports, Bajaj Auto Access Bank.
43:49These are your top Nifty gainers.
43:51On the flip side, pressure persists on Tech Mahindra, TCS, Infosys, Wipro, HCL Tech.
43:55Your top five Nifty 50 losers.
43:59And that's the take on the entire IT space.
44:01That H1B visa fee has still kept the sector sentiment quite negative.
44:06And the IT space is the biggest loser in today's trade.
44:09Almost a 3% cut coming in on Nifty IT intraday.
44:12Other than that, Energy Media Metal managed to hold on to some gains.
44:16Indusank Corporate did very well for itself up 5%.
44:18Realty Bank, PSU Bank, FMCT, Pharma have shut shop in the red.
44:22So that is what the market texture has been like today.
44:25We'll give those rates some time to settle exactly around the 25,200 mark.
44:29That's how we've shut shop for the day.
44:39GK Energy Limited launches an initial public offer of equity shares of face value of Rs.2 each.
45:04in the price band of Rs.145 to Rs.153 per equity share.
45:11Bid offer opens on Friday, September 19, 2025.
45:15Clues...
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