Closing Bell: Nifty above 25,250, Sensex up 194 points; IT, FMCG, banks shine

Indian equity indices ended on a positive note with Nifty above 25,250 on September 2 led by IT, FMCG and banking names. At close, the Sensex was up 194.07 points or 0.24 percent at 82,559.84, and the Nifty was up 42.80 points or 0.17 percent at 25,278.70.

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

The Indian market continues to hold its ground and sustains the new high with marginal positivity. The positive trend is broadly sustaining as the domestic economic growth is still healthy and PMI numbers are much above the long-term average indicating uptick in earnings in the coming quarters.

But volatility is increasing as Q1 GDP growth has moderated and a similar trend is witnessed in corporate earnings. Also, August Indian PMI readings were marginally below July numbers indicating that caution is in the air.

The markets began the week on a positive note and registered modest gains during a subdued trading session. After an initial uptick, the Nifty fluctuated within a narrow range before closing at the 25,278.70 level. Sectoral trends were mixed, keeping traders engaged, with FMCG and financials outperforming, while metals and pharma ended in negative territory. The broader indices were slightly on the back foot, finishing marginally in the red.

Markets are gradually inching higher each day, buoyed by favorable global cues and rotational buying in heavyweight stocks. However, the ongoing underperformance of banking majors continues to dampen sentiment. Given this scenario, we recommend aligning trades with the prevailing trend and seeking buying opportunities on market dips.

Nifty opened gap up and consolidated during the day to close in the green up ~43 points. On the daily charts we can observe that Nifty has closed in the green up for the thirteenth consecutive trading session.

Sectoral rotation is helping the Nifty to stay at elevated levels. Today it was the IT and FMCG Index which helped Nifty post healthy gains.

We shall continue to ride the upmove. On the upside we expect Nifty to target levels of 25500. On the downside the crucial support base is placed at 25210 – 25120 where the key hourly moving averages are placed. We shall continue to ride the upmove with a trailing stoploss mechanism.

The Bank Nifty showed some signs of revival however sustainability is a question mark given the weakness in the heavy weights of the index.

PSU Bank showed signs of resumption of an upmove and could witness positive action over the next few trading sessions. In terms of levels, 51580 – 51700 is the immediate hurdle while 51000 – 50900 is the crucial support zone from short term perspective.

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The Nifty failed to surpass the opening high after a positive start. Heavy call writing was observed at the 25,300 strike, and overall, call writers significantly outnumbered put writers throughout the day.

In the near term, the trend might remain sideways to negative as long as it stays below 25,300. On the lower end, however, the correction may be limited to 25,000, where significant put writing has been observed.

Indian rupee ended lower at 83.92 per dollar on Monday versus Friday's close of 83.87.

Indian equity indices ended on a positive note with Nifty above 25,250 on September 2 led by IT, FMCG and Banking names.

At close, the Sensex was up 194.07 points or 0.24 percent at 82,559.84, and the Nifty was up 42.80 points or 0.17 percent at 25,278.70. About 1684 shares advanced, 2191 shares declined, and 133 shares unchanged.

Bajaj Finserv, Bajaj Finance, HCL Technologies, Bajaj Auto and Hero MotoCorp were among the top gainers on the Nifty, while losers were Grasim Industries, Kotak Mahindra Bank, Adani Enterprises, Coal India and Nestle India.

Except bank, FMCG and IT, all other sectoral indices ended in the red with capital goods, metal, healthcare, telecom and media down 0.4-1.6 percent.

The BSE midcap index ended flat, while smallcap index was down 0.5 percent.

#1 Prefer Bajaj Finance amid superior growth, conservative underwriting & top-notch return ratios

#2 Believe asset quality concerns over rural distress for company are overdone

#3 Expect a positive surprise with a better-than-expected revival in rural India

#4 Listing of housing arm & comfortable valuation, have added company to high-conviction list

The board has approved a scheme of arrangement and amalgamation involving Gujarat State Petroleum Corporation (GSPC), GSPC Energy (GEL), and Gujarat State Petronet (GSPL) merging into GGL.

Additionally, the scheme involves the demerger of GGL’s gas transmission business, which will be listed separately as GSPL Transmission Limited (GTL).

Company's wholly-owned subsidiary namely SCI Bharat IFSC Limited has received a Letter of Approval from Office of Development Commissioner, Kandla Special Economic Zone, Department of Commerce, Government Of India to extend all the facilities and entitlements admissible to a unit in a Special Economic Zone and for the establishment of a unit at GIFT SEZ LTD[SEZ] in the State of Gujarat for undertaking authorised operations, namely, manufacture and rendering services including trading as stated in the said approval letter.

QIB – 0.45 times

NII - 10.77 times

Retail – 8.68 times

Employee Reserved - 25.29 times

Overall – 6.83 times

QIB – 0.78 times

NII - 8.40 times

Retail – 3.12 times

Employee Reserved - 16.50 times

Overall – 3.61 times

Life Insurance Corporation of India has reduced its shareholding in HDFC AMC to 2.88 percent from 4.91 percent between July 1 and August 29.

The Sensex was up 190.78 points or 0.23 percent at 82,556.55, and the Nifty was up 47.30 points or 0.19 percent at 25,283.20. About 1473 shares advanced, 2027 shares declined, and 107 shares unchanged.

Advance/Decline (Intra-day)

Indian Rupee depreciated by 7 paise today on positive US Dollar on Friday and disappointing macroeconomic data. India’s manufacturing PMI fell to 57.5 in August vs 57.9 in July and forecast of 58.2. However, positive domestic markets and FII inflows cushioned the downside. US Dollar gained on Friday amid stable inflation and upbeat personal income data from the US.

We expect Rupee to trade with a slight positive bias as domestic markets are trading at fresh record highs with fresh FII inflows. A Weak tone in crude oil prices may also support the Rupee. However, any recovery in the US Dollar may cap sharp upside. US markets will remain closed today on Labour Day holiday. USDINR spot price is expected to trade in a range of Rs 83.75 to Rs 84.10.

The company has acquired a 100 percent equity stake in Chalasani Hospitals, Visakhapatnam, for Rs 28 crore. Chalasani Hospitals is a 200-bed hospital established in 1995.

#1 Both Indrad & Dahej now cleared by US FDA with VAI classification

#2 Company now expects 5-10 new product approvals in FY25 and more in FY26

#3 Have factored recovery in US revenues for Torrent Pharma into estimates

#4 Factor in USD 133 m/USD 153 m/USD 184 m in sales for FY25/26/27 versus current annualised run-rate

The Board at extra-ordinary general meeting held on September 2, 2024, has approved the raising of additional capital by way of one or more public or private offerings including through a Qualified Institutions Placement (QIP) of equity shares or other eligible securities to eligible investors for an amount not exceeding Rs 270 crore.

#1 CMD laid out a clear path to monetisation across verticals

#2 Focus will be keeping balance sheet gearing conservative

#3 New energy EBIDTA targets, new chemicals investments & AI data center rollout positive surprises

The Company has received an order from Tamil Nadu GST authorities for the FY 2019-20 tax of Rs 1,31,12,999 and penalty of Rs 13,11,299.

The board has appointed Abhinav Goyal as the interim Chief Financial Officer until a regular CFO is appointed. Abhinav Goyal is currently the VP (Finance).

#1 Sectoral headwinds and weak Q1 has led to the recent underperformance

#2 Structural changes to protect metrics, however weakness likely in near-term

#3 Re-rating requires stable credit quality and growth

#4 Valuations discount to peers has increased and appear reasonable currently

#5 Due to sectoral headwinds, a sharp re-rating is less likely in near-term

QIB – 0.45 times

NII - 9.15 times

Retail – 7.37 times

Employee Reserved - 22.09 times

Overall – 5.82 times

QIB – 0.71 times

NII - 6.63 times

Retail – 2.89 times

Employee Reserved - 15.78 times

Overall – 3.30 times

Premier Energies Limited, a leading solar cell and module manufacturer, is poised for a remarkable stock market debut. The IPO has garnered immense investor interest, evidenced by a staggering subscription of 75 times and a sky-high grey market premium (GMP) of 485 (107.78%).

The company's strong fundamentals and growth prospects underpin this enthusiasm. Premier Energies boasts a diversified customer base, a robust order book, and a recent surge in profitability. While the company has faced challenges such as underutilized capacity and historical losses, its strong financial performance in FY24 demonstrates its resilience and ability to navigate industry headwinds.

Although the solar manufacturing industry remains competitive, Premier Energies' strategic positioning and focus on innovation differentiate it.

Considering the company's strong fundamentals, robust investor response, and favorable market conditions, Premier Energies is poised for an outstanding listing.

#1 Integration of GSPC's gas trading business will improve company’s margin profile

#2 Earnings volatility will rise, implying a lower valuation multiple

QIB – 0.45 times

NII - 6.34 times

Retail – 5.80 times

Employee Reserved - 19.91 times

Overall – 4.43 times

QIB – 0.71 times

NII - 6.05 times

Retail – 2.62 times

Employee Reserved - 15.24 times

Overall – 2.83 times

#1 Prefer Bajaj Finance amid superior growth, conservative underwriting & top-notch return ratios

#2 Believe asset quality concerns over rural distress for company are overdone

#3 Expect a positive surprise with a better-than-expected revival in rural India

#4 Listing of housing arm & comfortable valuation, have added company to high-conviction list

Shares of Indian Hume Pipe soared by an impressive 14 percent to reach a record high of Rs 613 on September 2, following the announcement of a significant Rs 828 crore work order from the Tapi Irrigation Development Corporation in Jalgaon, Maharashtra.

Indian Hume Pipe specialises in the manufacturing, laying, and jointing of pipelines. The company is also involved in infrastructure development projects, executing turnkey water supply initiatives. Additionally, it produces and supplies concrete railway sleepers to Indian Railways.

The newly secured order encompasses engineering, procurement, and construction (EPC) services, along with trial runs, testing, and commissioning of a gravity-piped distribution network. This network is designed to irrigate a 26,907-hectare area under the Jamphal Dam as part of the Sulwade Jamphal Kanoli lift irrigation project in the Shindkheda taluka of the Dhule district. Read More

The Sensex was up 83.93 points or 0.10 percent at 82,449.70, and the Nifty was up 19.40 points or 0.08 percent at 25,255.30.

Shares of Gulf Oil Lubricants India surged over 3 percent to Rs 1,464 in early trade on September 2 after Systematix initiated a "Buy" rating on the stock with a target price of Rs 1,700, citing strong growth prospects. The new price target has an implied upside of 20 percent from the current market levels.

The brokerage highlighted that Gulf Oil’s market share in the lubricants segment is expected to grow consistently, supported by the company’s strategic entry into the electric vehicle (EV) segment and DC cooling liquids. These initiatives are seen as key drivers for long-term growth. Read More

The board of directors of the company in its meeting held on September 2 approved to enhance the quantum of raising of funds, through issuance and allotment of equity shares of the Company of face value Rs 2 each on rights issue basis, from Rs 205,00,00,000 crore to an aggregate amount not exceeding Rs 250,00,00,000 crore.

Shares of Dixon Technologies fell around 4 percent after the company said that growth for FY25 will be slow due to its current ramp-up phase. The company indicated that the expected slowdown in growth is a result of ongoing adjustments and expansions.

The company targets a revenue of Rs 3,500 crore for FY25 and plans to reach Rs 48,000 crore over the next six years in the IT hardware segment. It is currently in discussions with two major global original equipment manufacturers (OEMs) regarding server contracts. Read More

Dr Reddy's shares sank into the red after the Chinese drug regulator National Medical Products Administration of China (NMPA) decided suspended the import, sale, and use of the pharma giant's Atomoxetine Hydrochloride capsules.

In a filing with the exchanges, Dr Reddy's Laboratories said that the NMPA China recently conducted a remote inspection of the firm's formulations manufacturing facility for Atomoxetine Hydrochloride capsules.

Atomoxetine Hydrochloride is a capsule which is used for treating attention deficit hyperactivity disorder (ADHD) in adults and children. Read More

The company has received an order from the Deputy Commissioner of Income-tax, with a potential tax demand of Rs 29.4 crore. This increases the total cumulative amount in ongoing litigations and disputes with the Deputy Commissioner of Income-tax to Rs 77.5 crore.

#1 The number of stakeholders Sebi is dealing with is growing. The complexity of the market ecosystem is being driven by the right product for the right person.

#2 As a regulator there is no other way to deal with the complexity by cocreating with the ecosystem.

#3 Single filing with exchanges is going to become a reality soon. If you file your disclosure with one exchange it will be filled at the other exchanges.

#1 AMFI has played an important role. We are on the way to make a Rs 250 SIP a reality - which makes it accessible to all.

#2 The role of the regulator to create this scale is deploying technology. Whether it is mkt ecosystem or Sebi adoption of technology is important

#1 Current downturn in demand was expected owing to elections followed by monsoons

#2 More hikes are needed as spot prices remain below Q1 average

#3 Industry consolidation should continue with inorganic opportunities

Nomura lowered its FY25 economic growth forecast for India to 6.7% year-on-year from 6.9% after official data on Friday showed the country's gross domestic product (GDP) grew slower than expected on an annual basis in the April-June quarter.

India's GDP rose 6.7%, less than the 6.9% forecast by a Reuters poll and the 7.8% growth in the previous quarter, as a decline in government spending during national elections weighed.

#1 Merger, demerger plan involving GSPC & GSPL well thought

#2 Company will benefit from its position as 2nd largest gas trading company in India

#3 Benefit will be from rising gas consumption, presence across value chain

#4 Its CGD/trading segment will benefit from potential entry of gas into GST

#5 Merger is EPS accretive with FY25E/26 proforma EPS at Rs 32/36 due to carried losses

#6 Proforma EPS will normalise to Rs 29 in FY27

Larsen & Toubro has carved out a separate business vertical for Renewable EPC out of its Power Transmission & Distribution business, within its Infrastructure Projects segment.

Airtel, MediaTek and Nokia today announced the successful completion of trials that efficiently combine TDD and FDD mid-band spectrum on a time basis utilising the latest generation chipset.

OIL has signed hook-up agreements with Indra Dhanus Gas Grid (IGGL) to enhance energy infrastructure in the North-East region

QIB – 0.70 times

NII - 4.27 times

Retail – 2.14 times

Employee Reserved - 13.99 times

Overall – 2.21 times

QIB – 0.0 times

NII - 3.71 times

Retail – 3.91 times

Employee Reserved - 14.96 times

Overall – 2.79 times

Techno Electric & Engineering Company has been awarded a contract to design, build, finance, operate, and transfer edge data centers (EDCs) by RailTel Corporation of India.

Shares of One 97 Communications, Paytm parent, fell as much as 5 percent  on September 2 as investors booked profits after the recent rise that had taken the stock higher by over 15 percent in two sessions.

Much of the gains are courtesy a 12 percent surge on Friday, after last week's go ahead on downstream investment in Paytm Payments Services. On August 28, Paytm Payments Services received a nod from the Finance Ministry for 'downstream investment' from its parent company, One 97 Communications, as per the company's exchange filing. Read More

The Board of Directors has approved a buyback of 500,000 shares (1.69 percent of equity) for up to Rs 50 crore at Rs 1,000 per share. The record date for the buyback is September 11.

Life Insurance Corporation of India has decreased its stake in the company to 6.43 percent from 8.58 percent between November 21, 2007, and August 29, 2024.

#1 Believe merger of GSPL & GSPL into Gujarat Gas is value accretive

#2 Merger will enable co to make quick use of the Rs 72,000 crore carry forward losses in GSPC

#3 Trading margin charged by GSPC from company will now be valued at higher multiple of CGD business

#4 There is a higher intrinsic value of both GSPC & GSPL's business (as per estimate) than being assigned

#5 Some small synergy benefits are also expected from cost savings & lower indirect taxes

Steel Strips Wheels has achieved net turnover of Rs 363.10 crore in August-24 versus Rs 389.77 crore in August-23 recording a dip of 6.84 percent YoY and achieved Gross turnover of Rs 442.75 crore in August-24 versus Rs 47L24 crore in August-23 there by recording a dip of 6.17 percent, YoY.

#1 Total sales grow 9.4 percent to 4,416 units Vs 4,037 units, YoY

#2 Power tillers sales jump 11.2 percent to 4,022 units Vs 3,616 units, YoY

#3 Tractors sales down 6.4 percent at 394 units Vs 421 units, YoY