IGI Logo

Market Update

* Equity benchmarks Sensex and Nifty dropped for the third consecutive session after the Reserve Bank of India’s interest rate cut, the first in nearly five years, failed to boost market sentiment.

* The RBI reduced the interest rate by 25 basis points to 6.25%. While rate cuts generally lift sentiment, this move did not have much impact as the reduction was already factored in. Additionally, the RBI maintained a "neutral" monetary stance and set the FY26 inflation target at 4.2% and GDP growth forecast at 6.7%, both in line with expectations. As a result, the Sensex fell 197 points, or 0.3%, to close at 77,860, while the Nifty dropped 43 points, or 0.2%, to end at 23,559.

* In global markets, European stocks and US equity futures were steady ahead of the highly anticipated US jobs data, which will offer insights into the future trajectory of interest rates.

* Interest-sensitive sectors like banking and real estate ended flat despite the RBI’s rate cut. However, metal, auto, and telecom stocks were the major gainers. Bharti Hexacom and Bharti Airtel rose by 12% and 4%, respectively, after reporting strong quarterly results. Metal stocks gained solidly due to rising global demand and expectations of improved consumption in China.

* The Nifty Metal Index surged by 3%, led by SAIL, Tata Steel, JSW Steel, and NMDC. Auto giants Hero Motocorp and M&M gained 1% and 2%, respectively, after reporting positive quarterly results.

Technical Outlook:

* Nifty index opened positive but witnessed wild swings on either sides in the first half of the day. It cascaded in the latter part which was followed by some recovery from 23450 zones in the last hour. It formed a bearish candle on daily frame with longer lower shadow indicating smart pullback from support zones.

* It formed a bullish candle on weekly frame and has been making higher highs from the last three weeks. Now it has to hold above 23500 zones for an up move towards 23750 then 23900 zones whereas supports are placed at 23500 then 23400 zones.

Derivative Outlook:

* Nifty future closed negative with losses of 0.28% at 23622 levels. Positive setup seen in Chambal Fertilizer, JSW Steel, Tata Steel, Bharti Airtel, Dixon, Glenmark, Torrent Pharma, VEDL, BSE, NMDC and Indus Tower while weakness in NCC, GAIL, PVR Inox, ITC, Cummins, Siemens, Naukri, Godrej Properties, Gujarat gas, VBL and COLPAL.

* On option front, Maximum Call OI is at 24000 then 23800 strike while Maximum Put OI is at 23000 then 23500 strike. Call writing is seen at 24000 then 23800 strike while Put writing is seen at 23200 then 23500 strike. Option data suggests a broader trading range in between 23000 to 24000 zones while an immediate range between 23200 to 23800 levels.

* Solar Industries – Company has signed a contract worth Rs 6084cr with the Ministry of Defense to supply defense products, and has also been nominated by the DRDO as the production agency for all variations of the Pinaka Rocket System – Positive

* JSW Energy – Company in power purchase pact with Amazon for 180MW wind power – Positive

* Raymond – Company in joint development pact for Mumbai real estate project with a potential revenue of Rs 1800cr – Positive

* Gensol Engineering – Company secures order for 245 MW Solar PV project worth of Rs 970cr – Positive

* VST Industries Q3 FY25 weak results - Net Profit Rs136.3cr, Revenue R367.2scr (up 1.3% YoY), Ebitda Rs38.4cr (down 6% YoY) and Ebitda Margin 18.6% vs 20.1% YoY

* Ola Electric Q3 FY25 weak results - Net Loss Rs564cr vs Loss Rs367cr, Revenue Rs1045cr (down 19.4% YoY) and Ebitda Rs460cr vs Loss Rs301cr

* Alkem Labs Q3 FY25 – Better than expected Ebitda and Ebitda margin - Net Profit Rs626cr (up 5.2% YoY) – expectation Rs550cr, Revenue Rs3374.2cr (up 1.5% YoY) – expectation Rs3310cr, Ebitda Rs759cr (up 7.3% YoY) – expectation Rs660cr and Ebitda Margin 22.3% vs 21.3% YoY – expectation 20%

* Mahindra & Mahindra Q3 FY25 – Consolidated Results Update – Both Ebitda and Ebitda margin inline with expectation - Net Profit Rs2964cr (up 20.8% YoY) – expectation Rs3200cr, Revenue Rs30538cr (up 19.6% YoY) – expectation Rs31200cr, Ebitda Rs4384cr (35.5% YoY) – expectation Rs4400cr, Ebitda Margin 14.4% vs 12.8 % YoY – expectation 14.2% and Other Income Rs265cr (down 32% YoY) – expectation Rs600cr.

* Century Plyboards Q3 FY25 – Ebitda and Ebitda Margin above expectation - Net Profit Rs58.4cr (down 7.3% YoY) – Bloomberg expectation Rs54.56cr, Revenue Rs1140cr (up 22% YoY) – Bloomberg expectation Rs1100cr, Ebitda Rs129.5cr (up 22% YoY) – Bloomberg expectation Rs118cr and Ebitda Margin Flat 11.3% - Blomberg expectation 10.7%

Global Market Update

* European Market - European stocks and US equity futures were steady ahead of highly anticipated US jobs data, which will help illuminate the path ahead for interest rates. UK, Germany and France are trading flat.

* Asian Market – A boost for Chinese tech stocks helped lift Asian stocks Friday despite selling pressure in Japan as traders await US jobs data that will help illuminate the path ahead for interest rates. Both Hong Kong’s Hang Seng Index touched the highest level since November in Friday trading as a gauge of Chinese technology stocks trading in the city was poised to enter a technical bull market. China and Hong Kong Index gained 1.5% each while Japan Index declined by 0.6%.

For More Research Reports : Click Here 

For More Motilal Oswal Securities Ltd Disclaimer
http://www.motilaloswal.com/MOSLdisclaimer/disclaimer.html
SEBI Registration number is INH000000412