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These 16 stocks helped Nifty in its journey from 12,000 to 13,000, do you own any?

Banking & financials, infrastructure, metals and auto stocks were the leaders that pushed Nifty50 to 13,000-mark.

November 25, 2020 / 02:20 PM IST

It took the Nifty just 14 sessions to blaze through to 13,000 from 12,000, when the index closed at a new high of 13,055 on November 24.

It had taken the index 78 sessions to move from 11,000 to 12,000 levels. On both occasions, broader markets performed better than benchmark indices.

The 1,000-point rally in November has been driven by foreign fund flows, which seem more confident of India's growth compared to other countries.

FIIs largely feel that India could grow faster than others as several European countries and the United States battling the second wave of coronavirus have been forced to reinforce several restrictions, say experts.

Also, India has taken steps to shore up the economy and encourage manufacturing as several countries rethink their dependence on China, from where the viral outbreak started, for almost everything—from high-end phones to kitchen equipment.

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"Declining dollar index is pushing FII flows and India is a major recipient of this huge capital flows. In November, till date, FIIs have invested a record Rs 55, 553 crore in India. This frenzied buying is unprecedented. Even though lots of justifications— economic, political & policy related—can be given for this massive global rally, the fact is that this rally is predominantly liquidity driven," VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services told Moneycontrol.

The leaders behind the November rally were more-or-less different from the previous 1,000-point upmove.

Banking & financials, infrastructure, metals and auto stocks were actual leaders that pushed Nifty50 to 13,000-mark, while in the previous 1,000-point rally, the support was first from IT stocks followed by banks.

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Bajaj Finserv was the biggest driver, with 52 percent upside in the last 14 sessions followed by Tata Steel and Bajaj Finance, which gained more than 35 percent each.

Eicher Motors, Hindalco Industries, Tata Motors, IndusInd Bank, Mahindra and Mahindra, Larsen & Toubro and GAIL India surged 20-28 percent, while Kotak Mahindra Bank, Axis Bank, State Bank of India, ITC, ONGC and HDFC Bank gained 14-18 percent.

In fact, gainers were much higher in the last November rally compared to the previous one. Overall, 48 stocks advanced against two declining shares, whereas 33 stocks gained against 17 falling shares in the journey from 11,000 to 12,000 on the Nifty50.

Apart from liquidity, the reasons for the increase in gainers were the better-than-expected September quarter earnings, vaccine development, easing asset quality concerns and economic recovery.

The benchmark indices rallied 74 percent from March 24 lows (intraday), while the broader markets' participation was also strong in the last eight months. Experts say valuations turned rich now, though the global liquidity may continue to chase equity in the coming weeks.

"Valuations are rich and in many cases, approaching bubble territory. If the Sensex goes past 45,000, some profits may be booked and cash levels in portfolios raised. Midcaps are likely to rise further," Vijayakumar said.
Sunil Shankar Matkar
first published: Nov 25, 2020 02:20 pm

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