Moneycontrol
Oct 18, 2017 03:20 PM IST | Source: Moneycontrol.com

Early Diwali! Nifty hits record high, market cap of BSE-listed firms also at new high

Reliance Industries which has a market capitalisation of over Rs 1 lakh crore rose to a fresh record high of Rs 891 on the BSE ahead of its Q2 results for the second day in a row.

ByKshitij Anand
Early Diwali! Nifty hits record high, market cap of BSE-listed firms also at new high

The Nifty50 rose to a fresh record high of 10,179.15 while the S&P BSE Sensex is still more than 200 points away from its record high of 32,686.48. But, the market capitalisation of BSE-listed firms hit a record high.

The total market capitalisation of BSE-listed companies touched a new high of Rs 138.26 lakh crore on Friday from Rs 137.56 lakh crore reported in the previous session, after a strong gain in heavyweight stocks like Reliance Industries (RIL), Infosys, Maruti Suzuki, and Bharti Airtel.

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Reliance Industries, which has a market capitalisation of over Rs 1 lakh crore, rose to a fresh record high of Rs 891 on the BSE ahead of its Q2 results for the second day in a row.

The oil & gas major’s consolidated profit to come at Rs 8,169 crore for the quarter against Rs 9,079 crore in previous quarter.

According to an average of estimates of analysts polled by CNBC-TV18, earnings before interest, tax, depreciation, and amortisation (EBIDTA) is likely to be strong at Rs 13,178 crore, compared with Rs 12,554 crore in June quarter.

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It took 10 years for the stock to replicate its massive outperformance that we saw in the calendar year 2007. But, now, it looks like the stock is in a bull trend and investors can remain invested for a long haul.

“If we consider its ex-bonus price, a multi-year breakout point was around the Rs550 mark. The moment this stock surpassed this hurdle on a sustainable basis, we witnessed a beginning of strong ‘Bull Run’,” Sameet Chavan, Chief Analyst- Technical Derivatives, Angel Broking Pvt Ltd told Moneycontrol.

“Since then there has been no stopping as we saw a whopping price appreciation of around 62 percent in the current calendar year. At present, the stock prices are trading way above its low (680.45) made after last ‘Quarterly Result’ day and is still going strong as we saw the stock clocking fresh record high today,” he said.

RIL closed record high of Rs 873 on the BSE on Thursday ahead of its July-September quarter (Q2FY18) results on Friday. The company’s m-cap gained by Rs 20,328 crore to Rs 5.52 lakh crore.

The two recently listed insurance companies SBI Life Insurance Company and ICICI Lombard General Insurance added Rs 1-lakh crore in total m-cap, also led the BSE m-cap to hit a new high, said a report.

The festive cheer ahead of Diwali and strong macro data is pushing the markets towards a new high, suggest experts. October which started on a positive note after a volatile September added over 1000 points to the S&P BSE Sensex.

Expectations of some recovery in the September quarter is also adding to the optimism.

“Going forward, the direction of this market will shift according to how Q2 earnings will pan out. Right now, it is an interplay between global and domestic factors. Q2 Nifty earnings to improve to 14 percent after 11 percent fall last year,” Abhay Laijawala of Deutsche Equities told CNBC-TV18 in an interview, adding that how this dynamic plays out will be critical.

Speaking on the global setup, Laijawala said that FIIs are now beginning to look at risk-reward for India in comparison to other emerging markets. Currently, valuations in India are higher than other EMs, he added.
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