Closing Bell: Nifty ends at 25,235, Sensex rises 231 pts; Bajaj Finance, M&M, NTPC top gainers

Action-Packed August ends on a high, Nifty above 25200. The bulls dominated the week, starting with a gap up on Monday and steadily climbing to new milestones, extending the winning streak to 12 consecutive trading sessions. Nifty ended the week with gains of 1.66%, closing just below the 25250 mark.

August was an action-packed month, initially marked by sharp declines as prices corrected from 25000 to 24000 in just three days. However, as the month progressed, the market steadily recovered, reclaiming lost ground and closing the month with a 1.14% gain. This price action formed a "Saucer" pattern, indicating further potential for an upmove in the near term. The reciprocal retracement of the August decline points to near-term targets of 25400 and 25500. During this week's upmove, the market left behind a couple of bullish gaps—one on Monday around 24850 and another on Friday near 25200.

The Monday gap is particularly significant, as it also appears on the weekly chart, suggesting that any dip toward this level is likely to be bought into. Before that, the previous swing high around 25080 could act as immediate support. However, the next leg of the move may not be as smooth as recent trends. The falling momentum during the recent upmove signals divergence, and the broader market is showing signs of weakness, with selective heavyweight stocks driving the gains. Therefore, traders are advised to avoid complacency, be selective, use dips as buying opportunities, and book profits at higher levels to avoid potential setbacks amidst market volatility.

Nifty ended higher on Aug 30 - for the twelfth consecutive session, its best winning streak since its launch in 1996. At close, Nifty was up 0.33% or 83.9 points at 25235.9. Cash market volumes on the NSE were ~71% higher compared to the previous day due to index rebalancing volumes. Broad market indices rose more than the Nifty even as the advance decline ratio rose to 1.39:1.

Global shares mostly rose Friday as markets continued to be moderately optimistic about the prospects of technology companies helped by the prospect of lower interest rates amid signs of moderating inflation across the developed world.

Nifty rose on Aug 30 with an upgap and closed at record highs. In the process it formed a doji like pattern. On weekly charts, Nifty rose 1.66%, while on monthly charts it rose 1.14%. On monthly charts, Nifty has formed a hanging man type pattern, suggesting possibility of a reversal in the coming month.  Nifty could take support from 24971 while 25400 on the upside could prove to be a resistance in the near term. April-June India GDP number due this evening could minorly influence sentiments either way on Monday.

Markets closed higher for the day, with the Nifty 50 up 83.95 points, or 0.33%, and the Sensex rising 257.11 points, or 0.31%. Sectors that performed well today included auto, banking, pharma, and mid- and small-cap healthcare.

Looking ahead to next week, market movement may hinge on key economic indicators, such as inflation reports and employment data, which could either sustain the current rally or prompt a pullback. Volatility may also increase as investors react to corporate earnings and any unexpected global news.

Markets edged higher, gaining nearly half a percent, continuing the current trend. Positive global cues led to a strong start, followed by a range-bound movement throughout the session. Most sectors participated in the rally, with real estate and pharmaceuticals among the top gainers. Broader indices also aligned closely with the benchmark, each advancing nearly half a percent.

The recent market uptrend can largely be attributed to global stability and renewed foreign inflows. We expect this positive sentiment to continue, with the Nifty targeting the 25,500 mark soon. Among the key sectors, IT is demonstrating consistent strength, while others show selective participation. In this environment, traders should focus on stock selection, favoring those with relatively stronger performance.

The Nifty-50 Index and Sensex gained around 1.7% each in the past week, while the mid-cap index gained around 1.7% and small-cap index gained just 0.6% underperforming large-caps. Markets followed the bullish cues of global markets. US Fed Chair Jerome Powell’s statement in Jackson Hole signaling imminent rate cuts, as well as greater confidence in soft landing, helped prop up emerging markets, including India.

Sectoral indices were largely positive a week-on week basis except for Nifty FMCG, Capital Goods and Power. Nifty IT was the top sectoral gainer with gains of 3.8%. Other Sectoral indices like Consumer Durable, Auto, Metal, Reality, Pharma, Media and oil and gas list between 1 to 3%. While Bank Nifty gained around 1% during the week. Within the Nifty Index, Bajaj Finserve (+8.9%), LTI Mindtree (+8.5%) and Bajaj Finance (+6.9%) gained the most, while Adani Enterprise (-2.1%), Grasim Industries (-1.8%) and Coal India (-1.8%) lost the most. Meanwhile, both FPIs and DIIs were net buyers in the same period. Going forward, D-street will focus on the macro trends, inflation and global situation including geo-political concerns.

In Global news, in US, weekly jobless claims fell from the prior week, further easing recession concerns. In addition, second-quarter gross domestic product was revised higher to 3% growth from an initial 2.8% rate. In Europe, France’s preliminary, EU-harmonized consumer price index came in at 2.2% for August on an annual basis, down from the 2.7% print of July. Even, German and Spanish CPI reports released Thursday showed that inflationary pressures in the two countries are easing. In Asia, Bank of Japan is widely expected to stick to its monetary policy tightening campaign as inflationary pressures in its capital city of Tokyo reaffirm the bank’s economic projections.

Global markets are currently resonating with the US Fed’s pledges of a rate cut in September. The US & Indian markets have regained the recent highs, reflecting the continuation of this optimism. However, the dollar is strengthening given healthy US GDP growth, strong retail sales and expectation that the upcoming US job claims will be steady leading to shallow rate cuts in the future. Though the domestic market is currently showing a positive bias, the Indian Q1 GDP growth is expected to be moderate, while premium valuation and a lack of fresh triggers could see further momentum buildup in value stocks.

The big risk is that if the stock price drops (price of collateral), and if the futures positions drops, then we have to square off positions. If too many brokers have pledged the same stock, then it can potentially impact the maekets.

In the last few years, the level of participation which has gone up in the capital market and a lot more is still to happen. From an education point of view or from an access point of view, there will be lot of innovation, innovations to be done. I think both these things work when the markets are going good, and in the parallel the system which is building more trust more transparency for stability and is going to build these roads to the next 100 million people and let them come into the system.

Ecos India Mobility and Hospitality's initial public offering (IPO) continued to attract robust demand heading to the final stages of the last day on August 30. Stock exchange data showed that subscriptions reached 42.22 times the issue size. Investors bid for 53.19 crore equity shares against the 1.26 crore shares on offer.

The New Delhi-based provider of chauffeur-driven car rental services aims to raise Rs 601.2 crore through the public issue, which consists entirely of an offer-for-sale of 1.8 crore shares by the promoters. The price range for the IPO is set between Rs 318 and Rs 334 per share. (More read)

#1 To commence joint development of a new gen engine named 'Aravalli' for the 13-ton Medium Lift class, Indian Multi-Role Helicopter (IMRH) & the Deck-Based Multi-Role Helicopter (DBMRH), being developed by HAL

Sensex Today | Hopeful of getting regulatory approval for business with BlackRock, in advanced stages of go to market strategy for BlackRock JV, says Jio Financial Services

#1 Zydus Life: To take steps, work with FDA for early remediation

On average, India is trading at a premium compared to other emerging markets, and it’s also an excellent growth market. For foreign companies looking to list in India, their Indian subsidiaries are performing well, which presents a great opportunity. As a result, we can expect to see more foreign companies choosing to list in India in the near future.

As bankers, we're currently working with many fintech companies that are preparing to go public soon. Over the next few months, we expect to see a healthy influx of these new-age companies entering the market, showcasing strong growth and a clear path to profitability.

The domestic investor is now playing a key role in setting valuation prices, and they tend to be more conservative than foreign investors. With a significant amount of money coming from domestic sources, they have the power to drive prices lower. However, this creates a tricky situation because when an IPO lists at 30, 40, or even 50 percent above the issue price, domestic investors often feel that more money could have been left on the table.

Valuations, in a relative sense, are more sober now than they were two years ago. In FY24, the average return on the listing day is around 27 percent, with an average return of 43 percent three months after listing. However, it's important not to get carried away with these averages. There are exceptional cases of massive overperformance, but there are also instances where investors can actually lose money.

In terms of concerns, the strong fund flows have led to momentum buying, causing valuations to become stretched. When looking at deal volumes, including block trades, a significant proportion consists of Offer for Sale (OFS) transactions. An interesting trend to watch is how much of this activity is focused on raising capital for capital expenditures (capex). IPO valuation is more of an art than a science, making it challenging to pinpoint exactly what a company should be valued at. It's not that bankers aren't doing their job; rather, it's the market dynamics and investor sentiment that often shift based on the pricing of an IPO. It's easy to look back and judge an IPO's valuation in hindsight. In many cases, the short-term returns from these IPOs are driven by momentum, particularly on the day of listing. It's important to have a variety of investors in the market, as long as the system isn't being hyped to achieve unrealistic valuations.

As practitioners in the capital markets, we used to see a complementary flow between Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs). However, now we're observing strong buying activity from both. Inflows have been remarkable, with around $35 billion in 2020, and in the calendar year 2024, we’ve already surpassed $38 billion. This surge in inflows has led to an increase in the size of deals as well. In just the first eight months, there have been 68 transactions, each nearly worth Rs 100 crore.

Two key differences from past market cycles are that this run is supported by the strongest Indian macroeconomic fundamentals and strong earnings momentum. Additionally, regulators have significantly improved the ecosystem, which boosts investor confidence.

Currently, the markets are priced to perfection, with global risks being the primary concern. However, there are numerous opportunities to raise capital through various means such as offer for sales (OFS) and external commercial borrowings (ECBs). We are also seeing issuances from innovative new models, further enriching the market landscape.

Three game-changing trends are reshaping the market: The serious emergence of domestic capital, with mutual funds, insurance companies, and high-net-worth individuals now driving equity issuance demand, has brought unprecedented breadth to the market, with issuances spanning various sectors. Additionally, it’s no longer taboo for promoters to sell their stakes, adding liquidity and diversity. While these developments have led to impressive gains of nearly 30 percent for investors, caution is needed, particularly in the SME IPO space. Many investors are not thoroughly reviewing offer documents, despite the substantial efforts by SEBI to ensure their transparency and detail.

The  work order for engagement of experienced manpower service providers for providing manpower and related services in Pune And Mumbai Territories of Directorate of Vocational Education & Training, Government of Maharashtra has been awarded.

The aggregate purchase order cost of the said work-orders is Rs 47,38,06,800.

#1 Telecom has seen a favorable market structure led by consolidation over years

#2 Strong players - Jio & Bharti Airtel continue to gain share with Jio (45 percent) & Bharti (37 percent) revenue share

#3 Expect market to consolidate further, as VI (not covered) subscriber churn remains high

#4 Jio is on path to reach nearly 500 million subscribers and a 50 percent share

#1 Expect improvement in growth & profitability across key markets, likely to attract premium to peers

#2 US generics present strong support to near-term earnings

#3 Company has gained traction with a few complex injectable filings

#4 Few complex injectable filings likely to be commercialised over next two years

#5 There are specific litigation-dependent upsides that can further support near-term earnings

#6 Expect narrative on US prospects to dominate downside risk in specific products like albuterol MDI

#7 Factor in higher rev contribution from mirabegron in FY25 & tolvaptan in FY26/27 vs earlier estimate

#8 Revise FY25/26 EPS Upwards By 28 percent/54 percent

Overall – 19.52 times

QIB – 6.61 times

NII – 48.09 times

Retail – 14.66 times

#1 Company targets to double its size in the next six years; no hints about IPO for Jio or Retail

#2 Jio aims to add 1 million Airfiber subscribers every month

#3 Prioritising investment across O2C and new energy verticals

Zydus Lifesciences has received final approval from the United States Food and Drug Administration (USFDA) to market Scopolamine Transdermal System 1 mg/3 days.

This is the fifth ANDA approval for Zydus in the transdermal portfolio, leveraging the group’s strengths in the manufacturing of complex drug device dosage forms.

The GST Council is expected to exempt term life insurance policies from the goods and services tax (GST) while continuing to tax insurance policies with an investment component, a decision that could boost demand for pure protection policies.

The decision is likely to be formalised in the GST Council meeting on September 9, a senior government official said, requesting anonymity. Read More

The National Company Law Tribunal (NCLT), Bengaluru, has approved the Scheme of Amalgamation of 3M Electro & Communication India with 3M India. The appointed date of the Scheme is April 1, 2023.

Shareholders of the company, at the Annual General Meeting, have approved the appointment of Shalini Kalsi Kamath as an Independent Director of the company for five years, effective June 14, 2024, and Phani Tangirala as Director of the company for three years, effective August 1, 2024. Phani has also been appointed as Managing Director and Chief Executive Officer of the company.

#1 Pure-play regional telecom operator with healthy balancesheet

#2 Forecast a 3-year EBITDA CAGR of 26 percent versus 20 percent/22 percent for Bharti’s India/mobile ops & 24 percent for Voda Idea

#3 See net debt/EBITDA declining to 0.9/0.3x by FY26/27 led by strong FCF generation, which opens up room for upside to payouts

#1 AGM focused on Jio, with traction in Airfiber, foray into data center

#2 Company expects retail to emerge from tough patch to deliver doubling of revenue/EBITDA in 3-4 years, ahead of our estimate

#3 New energy commissioning could see delays that push out value discovery to FY27

#4 Board will consider a bonus issue

The company has received an order from the Department of Goods and Services Tax, Maharashtra, demanding tax and a penalty of Rs 160.37 crore after conducting the GST audit for FY20. The company is in the process of filing an appeal before the Joint Commissioner of State Tax.

Overall – 15.15 times

QIB – 0.83 times

NII - 38.75 times

Retail – 13.21 times

Rail Vikas Nigam received Letter of Acceptance from SER HQELECTRICAL/SOUTH EASTERN RAILWAY for design, supply, erection, testing & commissioning of 132 KV Traction Substation, Sectioning post (SPs), and Sub sectioning post (SSPs) in 2x25KV system on Kharagpur - Bhadrak section of Kharagpur division of South Eastern Railway to meet 3000MT.

Gold prices eased on Friday, but were on track for a second straight month of gains on rising bets of a Federal Reserve rate cut next month, while traders awaited key U.S. inflation data for additional guidance.

Spot gold was down 0.3% at $2,513.99 per ounce as of 0333 GMT, but on track to have increased about 3% this month.

The state-owned telecom manufacturing company has secured its first electronic voting machine (EVM) order from the State Election Commission (SEC) of West Bengal for the supply of 500 sets of electronic voting machines.

Shares of Safari Industries surged nearly 6 percent to an all-time high of Rs 2,485 in early trade on August 30, driven by a spurt in volumes in the counter. Trading volumes in the counter rose as one lakh shares changed hands on the exchanges so far, higher than the one-month daily traded average of 73,000 shares. READ MORE

Step-down subsidiary NTPC REL has commenced commercial operations for the first part capacity of 160 MW out of the 320 MW Bhainsara solar PV project in Jaisalmer, Rajasthan. With this, the total installed and commercial capacity of the NTPC group has now reached 76,294 MW.

RPP Infra Projects has been received letter of acceptance for a new projects - Tamilnadu Climate Resilient Urban Development Plan(TNCRUDP) “Amrut 2.0" Providing 24x7 Water Supply to the pilot water zones Avadi City Municipal Corporatation and improvement of existing water supply distribution system for Avadi City Municipal Corporation

along with left out areas including operating & Maintenance of 5 years for a contract value of Rs 55.50 crore (Inclusive GST) .

The administrative committee of the board of directors of Piramal Pharma at its meeting held today, has approved subscription to 139,366,844 redeemable preference shares of face value of EUR 1 each aggregating to EUR 139,366,844 (Rs. 1306,56,41,6471 ), of Piramal Dutch Holdings N.V., a wholly owned subsidiary of the company through conversion of outstanding unsecured loan of equivalent amount owed by PDH NV to the company as on August 26, 2024.

The Tata Group company has acquired 13,000 equity shares (i.e., a 26% equity stake) in TP Parivart for Rs 1.3 lakh. TP Parivart is a subsidiary of Tata Power Renewable Energy.

The Securities and Exchange Board of India (SEBI) has approved the appointment of Nehal Vora as the Managing Director & Chief Executive Officer (MD & CEO) of the company.

Brainbees Solutions (Firstcry), Unicommerce Esolutions, Apis India, Omansh Enterprises, and Pearl Green Clubs and Resorts will release their quarterly earnings scorecard on August 30.

Oil India, Power Finance Corporation, Birla Precision Technologies, Cantabil Retail India, Career Point, Dai-Ichi Karkaria, Ganesh Housing Corporation, India Tourism Development Corporation, Jasch Gauging Technologies, Jindal Stainless, JTL Industries, Kajaria Ceramics, Kama Holdings, MOIL, National Fittings, Nava, NCC, POCL Enterprises, Prevest Denpro, Quick Heal Technologies, Royal Orchid Hotels, Salzer Electronics, Sarda Energy & Minerals, Shyam Metalics and Energy, Shankar Lal Rampal Dye-Chem, Suyog Telematics, TVS Srichakra, Uflex, Vijaya Diagnostic Centre, Swastik Safe Deposit

#1 New energy division to deliver cash flows that are less cyclical

#2 Potential earning capacity in next 5-7 years similar to existing O2C business

#3 Jio & retail targetting to double revenue and EBITDA in next 3-4 years

#4 Jio Cinema growth to be enhanced by merger with Disney+ Hotstar

#5 JioMart hyperlocal delivery with 1,300 smart points noted as a competitive edge

The aviation regulator Directorate General of Civil Aviation (DGCA) has placed budget carrier SpiceJet under 'enhanced surveillance' with immediate effect.

This would entail an increase in the number of spot checks and night surveillance to ensure the safety of operations.

DGCA conducted a special audit of SpiceJet's engineering facilities in August.

Fitch Ratings has assigned Canara Bank’s (BBB-/Stable) proposed senior unsecured notes an expected rating of ‘BBB-(EXP)’.

The notes will constitute Canara’s direct, unconditional, unsubordinated and unsecured obligations and will at all times rank pari passu among themselves and with all of Canara’s other unsubordinated and unsecured obligations.

At the upper price band of Rs 389, Baazar Style Retail is available at Mcap/Sales of 3.0x (FY24), which appears to be reasonably priced compared to its peers.

Considering the rise indemand, aggressive store additions, customer retention, cluster based expansion model, and positive industry growth opportunities, assign a 'subscribe' rating on a short to medium term basis.

The hotel chain has signed a License Agreement for a 72-room hotel property in Ayodhya, Uttar Pradesh. The property will be managed by its subsidiary, Carnation Hotels, and is expected to open in FY26.