Closing Bell: Nifty at 21,350, Sensex up 242 pts; IT, pharma, metal, realty gain

Indian benchmark indices ended higher for the second straight session on December 22 with Nifty above 21,300. At close, the Sensex was up 241.86 points or 0.34 percent at 71,106.96, and the Nifty was up 94.40 points or 0.44 percent at 21,349.40.

We wrap up today's edition of the Moneycontrol live market blog, and will be back Tuesday morning with all the latest updates and alerts. Please visit https://www.moneycontrol.com/markets/global-indices/ for all the global market action.

Overnight gains in the US markets and a sharp upsurge in domestic IT stocks aided sentiment in local indices. Although markets were a bit wobbly, markets stayed in positive territory in the second half as other sectoral stocks from metal, oil & gas, auto and realty pack rallied behind the markets.

Market traded volatile on Friday but managed to end in the green amid mixed cues. After the flat start, the Nifty oscillated sharply on both sides and finally settled at 21362.50 levels. All the key sectors, barring banking, traded in sync with the move wherein realty, IT and metal were among the top performers. The broader indices also extended gains and closed higher in the range of 0.7%-1.1%.

The last two days of the rebound in the index have eased pressure and it would be a healthy consolidation if Nifty spends some time around the current levels. We are seeing volatility across the sectors, so traders should maintain extra caution in stock selection and overnight risk management. And, we feel it is prudent to stick with index majors over midcap and smallcap counters.

The 'buy on dips' strategy continues to drive investors during the subdued week. Mid and small caps remain in the limelight, benefiting from ease in oil prices and the anticipation of a potential rate cut in CY24, supported by slower-than-expected US GDP growth and weakness in the dollar, signalling early rate cuts.

Realty and Auto sectors shine, while PSU banks outperform peers on account of improvements in balance sheets and profitability. Despite a premium valuation, the short-term positive trend persists, supported by a strong revival in FIIs buying & stock specific actions. Heading into the festive season and year-end, we can anticipate a range-bound trade scenario with limited data points.

The Bank Nifty index faced selling pressure on the last day but managed to hold the key support level of 47400. If the index fails to sustain above this support, it could witness further decline toward the 47100 levels.

On the upside, the immediate resistance is at 47700, and a breakout above this level may trigger short-covering, pushing the index higher toward 48000/48200 levels.

Indian rupee ended 12 paise higher at 83.15 per dollar on Friday versus Thursday's close of 83.27.

Market snaps 7-week gaining streak, Sensex & Nifty fall 0.5% each
Nifty Bank & Nifty midcap index fell more than 1% each this week
FMCG, pharma & energy were top gaining indices in volatile week
PSU Bank falls the most amongst indices, Union Bank & Canara Bank top losers

: Indian benchmark indices ended higher for the second straight session on December 22 with Nifty above 21,300.

At close, the Sensex was up 241.86 points or 0.34 percent at 71,106.96, and the Nifty was up 94.40 points or 0.44 percent at 21,349.40. About 2144 shares advanced, 1074 shares declined, and 88 shares unchanged.

The top Nifty gainers included Wipro, HCL Technologies, Tata Motors, Hero MotoCorp and Hindalco Industries, while losers were Grasim Industries, SBI Life Insurance, Bajaj Finance, HDFC Bank and ICICI Bank.

Except banks, all other sectoral indices ended in the green with auto, capital goods, healthcare, oil & gas up 1 percent each, while Information Technology, metal and realty up 2 percent each,

BSE midcap index rose 0.7 percent and smallcap index rose 1 percent.

AstraZeneca Pharma has received a draft order for the assessment unit being passed under section 144C(1) read with section 143(3) of the Income Tax Act, 1961 for assessment year 2021-22. In the said order the assessment unit has made adjustments on the legacy transfer pricing issues ie incorporating the impact of order passed under section 92CA(3) of the Act and certain corporate tax issues have been proposed.

The estimated cumulative tax impact of the adjustments proposed is Rs. 14.08 crores (approx.). The said amount does not involve any interest or penal consequences. The company will suitably challenge the order in the due course.

The Azad Engineering IPO has seen healthy response from investors across categories, subscribing 70.33 times with participants putting in bids for 71.19 crore equity shares against offer size of 1.01 crore shares, on December 22, the final day of bidding.

The qualified institutional buyers took the lead, buying 153.13 times the allotted quota, while high networth individuals (non-institutional investors) and retail investors picked shares 79.71 times and 21.32 times the portions set aside for them.

Employees, who have reservation for Rs 4 crore worth shares in the IPO, have bid 11.80 times the reserved portion.

-Overweight call, target Rs 370 per share
-Blackstone has sold its entire remaining stake of 23.6 percent in Embassy REIT
-Blackstone selling stake could improve daily trading volume & remove overhang on stock
-New SEZ rule should also help occupancy and better than expected NOI and DPU growth

Indian Rupee appreciated on Friday on positive domestic markets and a weak US Dollar. However, surge in crude oil prices and FII outflows capped sharp gains. US Dollar declined on Friday as US GDP was revised lower to 4.9% in Q3 2023 versus previous forecast. However, weekly unemployment claims topped forecast, preventing a sharp fall.

We expect Rupee to trade with a slight positive bias on rise in risk appetite in global markets and softness in US Dollar. However, Dollar demand from imports and selling pressure from foreign investors may cap the upside. Geopolitical tensions in the Red Sea may also weigh on Rupee at higher levels. Traders may take cues from inflation, pending home sales and durable goods orders from US. USDINR spot price is expected to trade in a range of Rs 82.80 to Rs 83.50.

-Overweight call, target Rs 485 per share
-Chemical integration from oil to chemicals continues
-Chemical integration leverages its excess light feedstock to expand returns
-India's USD 40 billion chemical capacity is inflecting for 1st time in a decade
-New PP expansion should be earnings

ICRA Limited has reviewed and upgraded the Can Fin Homes' LongTerm Issuer Rating to AAA from AA+ and has reaffirmed company's Short term issue rating as A1 +.

Ramkrishna Forgings has informed that the resolution plan submitted by the company for the acquisition of ACIL Limited has been approved by the National Company Law Tribunal, New Delhi.

-Overweight call, target Rs 10,000 per share
-SAT quashes SEBI orders on Karvy; lenders to be paid their dues with interest
-Bajaj Finance had charged off Rs 320 crore in FY20 to Karvy
-Await commentary from company to understand probability & extent of recoverability
-If & when received, it could translate to 1.7 percent/ 1.3 percent of FY24e / FY25e PAT
-Adding four years of interest, this could translate to 2.4 percent/1.9 percent, respectively

Sensex Today | Market at 3 PM

The Sensex was up 322.25 points or 0.45 percent at 71,187.35, and the Nifty was up 108.60 points or 0.51 percent at 21,363.60. About 2112 shares advanced, 1102 shares declined, and 81 shares unchanged.

Stock Market LIVE Updates | Nifty IT extends early gains, surges 2.4% led by Wipro, Persistent, Mphasis 

Online travel service provider Easy Trip Planners Ltd on Friday said it has acquired 13.39 per cent stake in Eco Hotels and Resorts in a share swap deal.

The company's investment in equity shares of Eco Hotels India is swapped with equity shares of the latter in the ratio of 1:1, Easy Trip Planners, which operates under brand EaseMyTrip, said in a regulatory filing.

Subsequently, it has acquired 40 lakh equity shares of Rs 10 each of Eco Hotels and Resorts issued on preferential basis, it added. Read More

Stock Market LIVE Updates | Pharma stocks rally up to 8% to 52-week highs amid rise in fresh Covid cases

Shares of a cutch of pharma and diagnostic companies rallied up to 8 percent on December 22 to hit their respective 52-week highs. The rise comes in the wake of a fresh spate of Covid cases. India recorded 640 Covid-19 infections by the new sub-variant called JN.1 on December 22, bringing the total active cases to 2,997.

The Nifty Pharma index surged over 1 percent to hit a 52-week high of 16,500.90 during the day.

The stock of Piramal Pharma zoomed over 8 percent to hit a 52-week high of Rs 140.20 on the BSE. It has surged 16 percent so far, largely in line with the benchmark Sensex. ICICI Securities has re-initiated coverage on the stock with a 'buy' rating and set the target price at Rs 180.

Gold prices hit their highest level in nearly three weeks on Friday as rising bets on Federal Reserve interest rate cuts early next year pushed the dollar and bond yields lower ahead of eagerly awaited U.S. inflation data.

Spot gold was up 0.2% at $2,049.20 per ounce, as of 0513 GMT, after hitting its highest since Dec. 4 earlier in the session. Bullion has risen 1.6% so far this week.

U.S. gold futures rose 0.5% to $2,061.40 per ounce.

Asian Paints informed that there was a minor fire incident in the under-construction premises of the plant of the company situated at Ankleshwar, Gujarat, on December 21, 2023 at around 7:05 p.m. The fire was immediately brought under control.

There have been no injuries or loss of life because of this incident. The damage was localised and confined to the cooling tower area of the under-construction premises. The cause of the fire is being investigated.

The production at the existing manufacturing blocks at the Ankleshwar plant of the company remains unaffected. Further, there is no material impact on the financials or operations of the company on account of the incident.

-Total credit card spending growth was healthy at 40 percent YoY in Nov’23
-Total credit card spending growth declined 10 percent MoM from a high base in Oct’23
-HDFC Bank and ICICI Bank accounted for 41 percent of net cards issued
-Among larger card issuers, HDFC Bank & IndusInd Bank gained market share
-Among larger card issuers, ICICI Bank, Axis Bank & SBI Card lost share

-Buy call, target raised to Rs 5,000 per share from Rs 4,520 per share
-Siemens at its FY23 analyst meet discussed that capex outlook remains strong for India
-Private sector capex is at an inflection point with enquiries converting to tenders
-At a company level there is confidence on maintaining profitability
-Corporate action could see energy listing separately
-Believe Siemens is a good play on power transmission and railways

Sensex Today | BSE Midcap index rose 0.5 percent led by Castrol India, Laurus Labs, Sun TV Network:

Stock Market LIVE Updates | Jefferies View On Hotels 

-Industry wide data for hotel industry in India suggests ARR growth remains in double-digit YoY 
-In Nov’23, ARR growth at 16 percent YoY, similar to Oct’23
-YoY growth in revenue PAR, however, sharply slowed to 8 percent YoY in Nov’23 versus 28 percent YoY growth 
-YoY decline seen in occupancy by 460 bps in November 
-Occupancy decline likely attributable to a difference in the timing of festivals YoY

Oil prices rose as much as 1% on Friday as tensions persisted in the Middle East following Houthi attacks on ships in the Red Sea, although Angola's decision to leave OPEC raised questions over the group's effectiveness in supporting prices.

Brent crude futures were up 70 cents, or 0.9%, to $80.09 a barrel by 0700 GMT, while U.S. West Texas Intermediate crude futures were up 66 cents, or 0.9%, at $74.55 a barrel.

Both of the contracts have risen for a second week, each up over 4%, as the shipping concerns buoyed prices.

Sensex Today | Market at 1 PM

The Sensex was up 294.00 points or 0.41 percent at 71,159.10, and the Nifty was up 96 points or 0.45 percent at 21,351. About 2066 shares advanced, 1086 shares declined, and 97 shares unchanged.

Godawari Power & Ispat has received an approval letter from Chhattisgarh Environment Conservation Board vide which the Board has accorded its "Consent To Operate" for enhanced capacity of Steel Melting Shop (SMS) from 4,00,000 Metric Tons per annum to 5,25,000 Metric Tons per annum at existing plant site at Siltara Industrial Area, Raipur, Chhattisgarh.

Bharat Electronics (BEL) received orders worth Rs 2,673 crore from Goa Shipyard Limited (Value: Rs 1701 crore) and Garden Reach Shipbuilders & Engineers (Value: Rs 972 crore) for supply of 14 types of sensors for use on Next Generation Offshore Patrol Vessels (NGOPV).

The company has also received additional orders worth Rs 86.15 crore.

The dollar stabilised above a more than four-month low on Friday, with a key U.S. inflation gauge due later in the day that could offer clarity on how much room the Federal Reserve has to cut interest rates next year.

The greenback hit a five-month trough against the New Zealand dollar and a three-week low against the euro in early Asia trade, before turning positive later in the session.

Sensex Today | BSE Information Technology index up 0.5 percent led by Axiscades Technologies, Xchanging Solutions, 63 Moons Technologies:

PSP Projects has emerged as Lowest (L1) Bidder in the Project "Civil, MEP & Finishing work for Development of Street” for Gandhinagar Municipal Corporation at Gandhinagar, Gujarat worth Rs 158.61 crores (excl. GST).

Railtel shares rallied over 3 percent on December 22 after the company received a Rs 66.83-crore work order from NF Railway Construction.

The order is for supply, installation, testing and commissioning of integrated tunnel communication system, emergency call arrangements in tunnels and Integrated Passenger Information System (IPIS) at stations in Bhairabi - Sairang New Single line Section of the Lumding Division.

The order has to be executed within one year from the date of Letter of Acceptance (LOA).

LIC shares zoomed over 5 percent to hit a 52-week high on December 22 after the government granted a one-time exemption to the insurer to achieve 25 percent minimum public shareholding (MPS) within 10 years.

This removes a key overhang from the stock because its earlier deadline to achieve MPS was May 2027, as per the Sebi regulation, which would have meant share sales by the government. The government holds 96.5 percent in LIC. Read More

Sensex Today | Market at 12 PM:

The Sensex was up 358.58 points or 0.51 percent at 71,223.68, and the Nifty was up 127.80 points or 0.60 percent at 21,382.80. About 2346 shares advanced, 787 shares declined, and 85 shares unchanged.

M/s. KPIG Energia Private Limited, a wholly owned subsidiary of KPI Green Energy, received new orders of 1.80 MW for executing solar power projects received under ‘Captive Power Producer (CPP) segment of the company.

I foresee outperformance in large-cap IT stocks after a prolonged period of underperformance, particularly due to a stabilizing US economy. The elimination of concerns regarding a hard landing in the US economy is instilling confidence among companies, potentially boosting discretionary spending in IT and overall technology investments.

Consequently, Indian IT firms are poised to benefit from this shift, likely surprising on the upside in their deliveries within a quarter or two. Notably, large-cap IT companies, including Accenture, secured significant multiyear contracts in the past year, albeit facing delays in implementation due to slowed discretionary projects. However, a resurgence in economic confidence could fast-track these initiatives, leading to improved performances by Indian IT firms. Lastly, the advent of Generative AI presents a substantial opportunity for software companies, akin to significant technological waves such as Y2K or remote management application development, albeit its magnitude is yet to be determined.

Manganese ore major MOIL shares jumped 4.6 percent in early trade on December 22 after the company recorded its highest ever production.

Production surpassed 16 lakh tonnes on December 20, which was 26 percent higher than the previous best achieved in 2019. Sales during the calendar year till December 20, 2023 has also exceeded 14 lakh tonnes, breaking a multiyear record of 2007.

State Bank of India will be signing USD 165 million Line of Credit from World Bank for supporting grid connected rooftop Solar PV Projects in Residential & Institutional sectors, on 22nd December 2023 at Delhi.

Scooters India released Letter of Offer for delisting their shares from the stock exchange. The delisting offer will open on December 26, 2023 and close on April 8, 2024. The last date for verification and acceptance of shares by acquirer is April 18, 2024.

The order win momentum in the mobility segment led to strong growth in overall order inflow and provides revenue visibility over the long run. Factoring in the strong visibility in capex and order inflow led by digital penetration coupled with government capex in railway and power T&D, Broking house raised its revenue estimates by 2.1%2.8% and earnings estimates by 2.4%/3.4% for FY24F/25F, respectively.

Retain Add rating on the stock with a target price of Rs 4,400 (from Rs4,255 earlier), valuing it at 60x Sep 2025F EPS. Any slowdown in the order inflow momentum is a downside risk.

-Buy call, target Rs 1,350 per share
-OEM partnerships have started to bear fruit with higher conversions in PV & LCV
-Higher tie-up of HPHT gas is compensating for APM shortfall with minor price tweak
-APM shortfall with minor price tweak enough to offset rising feedstock cost to defend margin
-EV risks are manageable in our view vis-à-vis NCR

Shares of Allcargo Logistics rose by 7 percent at the opening on December 22, a day after the logistics major announced its decision to restructure its business under Allcargo Limited and Allcargo Gati Limited (formerly Gati Limited).

In a regulatory filing, the company said that Allcargo Logistics Board and Allcargo Gati Limited board have approved the composite scheme of arrangement for restructuring of businesses. Read More

Adani Green Energy gained nearly 1 percent at the open on December 22, a day after it was reported that the parent group was planning to invest $1 billion into the renewable arm, driving the stock up 4 percent.

According to a Bloomberg report, Gautam Adani and his family plan to inject $1 billion into the conglomerate’s renewable energy unit. This move is a part of the group's aim to reach "ambitious green goals while facing maturing bonds next year". The company aims to reach 45 gigawatts of green energy capacity by 2030.

Sensex Today | BSE Auto index up 1 percent led by Tata Motors, Sundram Fasteners, Ashok Leyland:

Medplus Health Services' subsidiary company has received order from the Drugs & Control Authority on suspension of drug license for 5 days from the date of receipt of order due to violation of various conditions of licenses.

LupinLife, the consumer healthcare business of Lupin launched Softovac Liquifibre, a 100% Ayurvedic liquid laxative. With this, the company enters the Indian liquid laxative market with this product that is a formulation of Isabgol fibre in liquid form and natural actives such as Sonamukhi, Harad, Mulethi, Saunf, Amaltas and Gulab Dal.

-Buy call, target Rs 165 per share
-Shiprocket deal appears unlikely to us (anyway company denied)
-Zomato already owns 5 percent stake following an investment in 2021
-Ascribe a low probability of a deal at this stage
-Ascribe a low probability of deal as management hands are full with quick commerce
-Company still in ramp-up phase while balancing growth & margin is a key focus in food delivery

Sensex Today | Market at 10 AM

The Sensex was up 209.08 points or 0.30 percent at 71,074.18, and the Nifty was up 79.30 points or 0.37 percent at 21,334.30. About 2381 shares advanced, 552 shares declined, and 89 shares unchanged.

Sensex Today | BSE Metal index up 1 percent supported by SAIL, Coal India, Tata Steel:

BATA India announced Pankaj Gupta, Head of Retail & Franchisee Operations will resign from the post and move to a global position in Bata group effective from March 1, 2024. Badri Beriwal Chief Strategy & Business Development Officer of the Company, will be additionally leading the Retail Business including Bata, Hush Puppies and Franchise operations of the Company.

Sensex Today | Nifty Pharma index up 1 percent supported by Divis Laboratories, Zydus Lifesciences, Dr Reddy's Laboratories:

Shares of GMR Airport Infrastructure gained 2 percent at the open on the NSE on December 22, a day after the company announced that its subsidiary GMR Airports Limited had entered into an agreement with NIIF to develop and operate the Bhogapuram International Airport. At 9:20am, the stock was trading at Rs 74.90.

In a regulatory filing, GMR Airports Infrastructure Limited said that GMR Airports Limited (GAL) and NIIF (National Investment and Infrastructure Fund) had entered into binding agreements for NIIF to invest up to Rs 6.75 billion in GMR Visakhapatnam International Airport Limited (GVIAL), a special purpose vehicle to develop and operate the Bhogapuram International Airport. Read More

Sensex Today | BSE Realty index up 1 percent led by Prestige Estates Projects, Phoenix Mills, Brigade Enterprises:

The market signal is that Wednesday’s sharp correction was a one day event and not a reversal of the uptrend. This confirms the success of the buy on dips strategy, which has played out consistently in the ongoing rally. The global cues continue to be favourable with the dollar index below 102 and the US 10-year bond yield hovering around 3.9%.

The concern in the market now is the excessive valuations in the mid and small cap segments. Retail exuberance and sustained flows into the mid and small cap mutual funds are driving this rally, which has slipped into a frothy zone. This broader market rally cannot continue for long. Safety is as important as returns. Undoubtedly safety is in large caps now. Going forward, large caps are likely to outperform mid and small caps.

-Buy call, target Rs 165 per share
-Shiprocket deal appears unlikely to us (anyway company denied)
-Zomato already owns 5 percent stake following an investment in 2021
-Ascribe a low probability of a deal at this stage
-Ascribe a low probability of deal as management hands are full with quick commerce
-Company still in ramp-up phase while balancing growth & margin is a key focus in food delivery

LIC got exemption from Department of Economic Affairs to achieve the 25% minimum public shareholding threshold within 10 years of listing in 2032. The department termed the decision was taken due to “public interest”.