Share Market Highlights 1 February 2024: Indian Indices turn choppy post Budget presentation; media, metal stocks drag; banking, auto stocks shine

Benchmark equity indices ended lower on the Budget day on Thursday as investors opted for profit-taking amid mixed cues.

The 30-share BSE Sensex declined 106.81 points or 0.15 per cent to settle at 71,645.30. During the day, it gyrated between a high of 72,151.02 and a low of 71,574.89.

The Nifty dipped 28.25 points or 0.13 per cent to 21,697.45. It oscillated between the day’s high of 21,832.95 and a low of 21,658.75.

The rupee appreciated by 8 paise to close at 82.96 against the US dollar on Thursday after the government hinted at faster fiscal consolidation and lower borrowings in its interim Budget for 2024-25.

Data Patterns (India) Ltd, the Chennai-based Defence and Aerospace electronics solutions provider reported a 54 per cent increase in net profit to ₹51 crore for the third quarter ended December 31, 2023 as against ₹33 crore for the same quarter last year. Revenue increased by 26 per cent to ₹140 crore (₹111 crore).

The company’s stock price on the NSE was trading at ₹1,949, up by 2.28 per cent.

Anand Rathi, Chairman, Anand Rathi Group:

The budget’s fiscal metrics are notably promising. The reduction of the fiscal deficit to 5.8% of GDP for the current year, down from the previously budgeted 5.9%, and the target of 5.1% for the next financial year, are commendable steps towards fiscal prudence. Additionally, the reduction in the net borrowings augur well for funds availability to Private Sector to achieve growth.

This budgetary approach, combined with the inclusion of Indian bonds in the global bond fund index, indicates a substantial scope for a reduction in yields of Govt. Securities. This is not only favorable for the bond market but also augurs well for the Indian equity market. The budget is particularly beneficial for public sector banks due to their large bond holdings, as well as for infrastructure, tourism, and logistics companies, in light of the specific announcements made. The focus on housing is particularly positive for cement and other building materials.

Additional Provisions under PMS Awas Yojana and free installation of Rooftop Solar System to 1 Crore poor people will help more and more population to move out of Poverty.

A noteworthy feature of the budget is the provision of a ₹1 trillion long-term (50-year) fund at low or no interest rate, dedicated to research and development. This initiative has the potential to be a game changer, fostering innovation in India.

In summary, this budget represents a balanced and positive approach, focusing on stimulating growth and financial stability. It achieves this through targeting investment and innovation, without resorting to being populist ahead of the forthcoming general election. The emphasis on prudent fiscal management while driving growth reflects a strategic approach in the current economic scenario.

Yamini Bhat, Co-Founder and CEO, Vymo: 

“The budget has taken steady steps towards fostering an environment where women excel both professionally and academically. The allocation of 30 crore Mudra Yojana loans for women entrepreneurs will strengthen women-led micro businesses and their contribution to the economy. A 28% surge in female enrollment in higher education and stronger representation in STEM courses reflects progress in gender inclusivity. The focus on ease of living and dignity for women entrepreneurs validates the challenges they face, signaling a positive shift towards a more inclusive entrepreneurial ecosystem. Vymo applauds the various initiatives launched for the start-up community including the PM Mudra Yojana and transformative schemes like Fund of Funds and Start Up India. The one lakh crore corpus for research aligns with Vymo’s commitment to innovation, and is a boost to the private sector as they scale up research and innovation in sunrise domains.”

Gautam Shahi, Director, CRISIL Ratings Ltd on Union Budget 2024:

“Policy measures announced in the budget such as setting up of a payment security mechanism and emphasis on increasing support to the manufacturing of charging infrastructure are steps in the right directions for improving the adoption of e-buses for public transport networks. CRISIL Ratings’ expects penetration of electric buses to double to ~8% by fiscal 2025, from ~4% in fiscal 2023.”

Chirag Mehta, Founder, Arbour Investments:

This year’s interim Budget presented by Finance Minister Nirmala Sitharaman for the year 2023-24, has been a welcoming move for the Indian Real Estate. The budget presented has raised hopes for the Indian Real estate sector. The capital expenditure outlay on the Infrastructure development has been a welcoming move. Whereas easing the legal provision is a need of the hour. The possibilities of High end Income group investing in the sector will undoubtedly see the shift in the completion of the successful residential & commercial project completion.

Sandeep Das, MD & CEO – Centrum Wealth on the Interim Budget 2024:

For an interim budget, the announcements made today reinforced the Government’s resolve on fiscal consolidation and pro-growth outlays that steered away from populist spending, especially ahead of a major election. Thus, as against street expectations, the Government projected a lower fiscal deficit of 5.1% of GDP in Fy25. The 11% increase in infrastructure spending also was a welcome surprise. Support for innovation and start-ups and a significant thrust on renewable energy reflect impetus towards much needed focus areas. Finally, through lowering its borrowings, the Government has made space for the private sector to step in and take over the baton on investment spending. Overall, a welcome part of the broader vision for a ‘Viksit’, Developed and Prosperous Bharat@ 100 by 2047.

Mandar Pitale, Head- Treasury, SBM Bank India:

“Today’s Union Budget has further strengthened the Government’s commitments towards long-term social and infrastructure developments ensuring continuity in growth story. 11.1% increase in Capital outlay for next year (3.4% of GDP), coupled with the multiplier impact due to past increases, will continue to act as a catalyst for economic growth and employment creation. The revised fiscal deficit number of 5.8% of GDP for current fiscal, 5.1% of GDP for the next fiscal with a sustained focus on targeting a number below 4.5% of GDP by FY 26 shows a commitment towards Fiscal prudence. The trend witnessed in the recent past along with these projections shows Government approach of under promising and over delivering on Fiscal front. Actual fiscal consolidation progress is expected to be much stronger. This is a major positive for interest rate markets.

The Gross (INR 14.13 Lac Crore) and Net (INR 11.75 Lac Crore) borrowing numbers are below market expectations partially attributable to the active and passive investment flows from overseas investors due to index inclusion. Likelihood of FY 25 maturing Central Government securities held by RBI (an estimated number of about 1 Lac Crore) getting switched directly with Government might also have been factored into these numbers. A large dividend estimated to the tune of INR 1.5 Lac Crore from RBI and other PSUs will contribute significantly to revenue augmentation. INR 1 Lac crore interest-free loan for 50-year tenor will address to much-needed long-term financing needs for scaling up research and innovation in upcoming essential technological verticals. This budget is getting accolades from market as Judicious, Non-Populistic and Visionary Budget”.

Sachin Kotak, Partner at Bain & Company, on the energy sector after Interim Budget 2024:

Sachin Kotak, Partner, Bain & Company: “The Budget has sustained focus on the Energy Transition initiatives. Given that it’s an Interim Budget before the elections, the Budget, while not going aggressive on announcements, has ensured continued steer with right nudges. Notable announcements are with respect to rooftop solarization and mandatory blending of CBG in PNG and CNG, which can significantly boost the market size for these businesses in the immediate future and help build momentum. Another interesting scheme to watch out for will be related to bio-manufacturing and bio-foundry – there is substantial potential for bio-plastics, bio-polymers in India, and it will help us move ahead in this nascent but rapidly developing global industry. Viability gap funding for Offshore wind is a step with the right intent; however, the industry will need more to harness the full potential of the segment. Similarly, the budget makes several other right mentions like a push for E-buses, setting up of coal gasification and liquefaction capacity, and doubling of spend on the National Green Hydrogen Mission. All positive signs, however, we expect more to be there in the main July budget and are looking forward to it.”

Amisha Vora, Chairperson & Managing Director, Prabhudas Lilladher Group on the Interim Budget 2024:

“Normally in an election year, we generally see a populist budget. However, the Honorable Finance Minister has put the growth in clear perspective with prudence taking over populism in this budget. It outlines development that will be all-round, all-inclusive, and all-pervasive towards making India a Viksit Bharat by 2047. FY23-25 interim budget has carried forward Govt focus on Net zero by 2070 (Rooftop Solarisation, Non fossil fuel, E vehicles), 11% higher capex allocation (18% effective increase) , higher allocation for PM Awas, MNREGA, Aquaculture and Tourism. Fiscal situation seems to be in fine shape with CAD at ~1% of GDP and fiscal deficit at 5.8% of GDP with next year target at 5.1% of GDP. FY25 assumptions of 11.5% growth in GST and 11.7% in corporate tax and 13% in income tax look reasonable. There has been no change in corporate and Income tax rates. Total debt has been lower than earlier estimates and FY25 gross markets borrowings with increased private capex will continue to provide growth capital and momentum to the economy. In a nut shell interim budget just ensures strong fiscal discipline and continuity of policies”.

​Rites​ has declared an Interim Dividend of ₹4.75 per equity share. 

Its standalone net profit for the quarter ended Dec 2023 stood at ₹118.57 crore as against ₹131.52 crore in December 2022.

Panacea Biotec Pharma Limited (PBPL), a Panacea Biotech subsidiary, has received a communication from the USFDA indicating the inspection classification as “Official Action Indicated” (OAI). The OAI classification implies, inter-alia, that the USFDA expects further corrective actions and may withhold approval of any pending product applications or supplements in which this facility is listed till the outstanding observations are resolved.

The BSE Sensex fell 106.81 pts or 0.15% to close at 71,645.30. The NSE Nifty fell 28.25 pts or 0.13% to settle at 21,697.45.

Ashok Leyland has sold 15,939 units of vehicles in Jan 24, including exports, as against 17,200 units in Jan 2023.

Shares closed at 174.70 on the NSE, down by 0.68%.

Ashwini Kumar, Head- Market Data, ICRA Analytics, the wholly owned subsidiary of ICRA Ltd:

“The Interim Budget announced by the Union Finance Minister, Nirmala Sitharaman on Thursday, has prioritised focus on the poor, women, youth, and farmers to drive the country forward. This is expected to support India’s growth in the long term.

The central government has set a lower target for gross and net borrowing during the next financial year (2024-25) over the current fiscal even while it foresees a high tax mop-up and remains committed to resuming fiscal consolidation. The government has estimated gross borrowing of Rs 14.13 lakh crore and net borrowings of Rs 11.75 lakh crore in 2024-25, both of which are lower than that in 2023-24.

Following this lower-than-expected target for borrowings, the country’s 10-year benchmark yield fell as much as eight basis points to 7.0511% on Thursday. The bond yields are likely to witness some softness in the short-term.”

Saji John, Research analyst, Geojit Financial Services:

“Overall, the budget hails for economic development and narrows the fiscal deficit to 5.1% in the next financial year. The government intends to let the private sector run with a capex growth of 11% for the upcoming fiscal year while modernising the rail network and port links to boost tourism, increase logistics efficiency, and reduce costs. The government has allotted Rs. 8,500cr and Rs.600cr for solar and national green hydrogen, respectively, to emphasize the usage of renewable energy. Further, adoption of e-buses for public transport and strengthening e-vehicle ecosystems through backing infrastructure providers for production and charging.”

Lupin has received approval from the USFDA for its Abbreviated New Drug Application for Dronedarone Tablets USP, 400 mg. The product will be manufactured at Lupin’s Goa facility.

Shares traded at ₹1,512.55 on the NSE, up by 0.48%.

Pankaj Pandey, Head of Retail Research, ICICI Direct:

“The Interim Budget has relied on capex-led socio-economic growth template while ensuring the fiscal prudence. The government has effectively leveraged the direct benefit transfer to deliver multiple social benefit schemes focussing on GYAM (Gareeb, Yuva, Annadata and Mahila). Capex spending remains one of the focus areas of the government with capex allocation growth of 11.2% YoY in FY25BE to ₹ 1.1 lakh crores. We highlight that capex growth is on high base of last 4 years wherein it has tripled resulting in huge multiplier impact on overall economic growth and thus moderation in capex growth is largely on expected lines. The capex to GDP is pegged at all time high of 3.4% (vs. 3.3% in FY24).

On the fiscal front, the glide path on reducing fiscal deficit has been complied with fiscal deficit likely to go down to 5.1% in FY25E vs. 5.8% in FY24. Medium term target of 4.5% fiscal deficit by FY26 is also on track.

The union budget has also further boosted Indian debt market outlook given the impending global bond index inclusion. Lower than anticipated fiscal deficit and gross borrowing puts debt market in sweet spot besides making the proposition attractive for banks specially PSUs.

To sum up, the Union Budget reflects a realistic set of measures to drive growth in Amrutkaal.”

Alembic Pharmaceuticals has commenced operations in a phased manner at its manufacturing facilities at Namthang, South Sikkim. The facility is to be fully operational within a month, the company said in its stock exchange filing.

The stock traded at ₹957.20 on the NSE, down by 0.34%.

Major gainers on the NSE at 3 pm:

Maruti (4.72%); Cipla (2.71%); Power Grid (2.58%); SBI Life (2.46%); HDFC Life (2.19%)

Major losers:

L&T (-2.32%); Ultratech Cement (-2.25%); Dr Reddy’s (-2.20%); JSW Steel (-1.92%); Titan (-1.85%)

Stocks advanced on BSE at 3 pm on Feb 1, 2024, were 1,773 against 2,014 stocks that declined; 136 stocks remain unchanged. Total stocks traded were 3,911. The number of stocks that recorded a 52-week high was 451, and those that hit a 52-week low was 19.

Wheels India has incorporated a wholly-owned subsidiary in the name of ‘WIL USA Inc.’ in the State of Delaware, USA.

Stock trades at ₹651 on the NSE, down by 1%.

Aditya Birla Capital reported standalone net profit for the quarter ended December 2023 at ₹25.58 crore as against net loss of ₹0.85 crore in December 2022 quarter. 

The stock traded at ₹169.90 on the NSE, down by 0.70%.

The BSE Sensex fell 4.93 pts or 0.01% to 71,747,18. The NSE Nifty was down 4.60 pts or 0.02% to 21,721.10.

Maruti Suzuki India, in Jan 2024, sold a total of 199,364 units. Total sales in the month include domestic sales of 170,214 units, sales to other OEM of 5,229 units and exports of 23,921 units.

Maruti Suzuki stock rose 4.88% on the BSE, trading at ₹10,680.

Jindal Steel & Power Limited has informed the exchange regarding resignation of Bimlendra Jha as managing director of the company w.e.f. January 31, 2024. 

Stock traded at ₹741.60 on the NSE, down by 2.05%.

Major stocks that hit a 52-week high on the NSE:

​India Tourism Development Corporation​ (16.84%)

Ratnaveer Precision Engineering (14.10%)

​KPI Green Energy​ (8.73%)

​Godrej Consumer Products​ (7.77%)

​Motherson Sumi Wiring India ​(7.53%)

Raghvendra Nath, MD, Ladderup Wealth Management’s reaction on the Interim Budget 2024:

“The interim budget for FY24-25, in line with expectations, sets a fiscal deficit target of 5.1% of GDP, reflecting the government’s commitment to fiscal prudence and consolidation. This positions the country to achieve the 4.5% fiscal deficit target by FY25-26. A noteworthy 11% increase in capex spending to ₹11.1 lakh crore for FY24-25 is expected to drive economic growth. Additionally, the decision to waive disputed direct tax demands ranging from ₹10,000 to ₹25,000 until 2009-10 provides relief to taxpayers. Overall, the budget conveys a message of continuity and ensures no negative surprises.”

Post- interim budget view from Mr. Sunil Nyati Managing Director of Swastika Investmart LTD:

While the budget itself contained minimal surprises, it reflected the government’s commitment to fiscal prudence and tempered expectations. Unsurprisingly, the market showed muted reaction, choosing to prioritize upcoming earnings reports and global developments as drivers of stock- and sector-specific outperformance. For Nifty, the key resistance zone lies at 21800-21850; a break above this level could pave the way for a new all-time high. Conversely, immediate support sits at 21500, with 21200 providing the next safety net.

Adani Enterprises has reported its standalone net profit for the quarter ended Dec 2023 at ₹718.46 crore as against ₹269.71 crore in Dec 2022 quarter.

Stock rose by 1.43% on the NSE, trading at ₹3,186.80

MD & CEO, Motilal Oswal Financial Services Ltd. on the budget: 

“The government has presented a very prudent Budget/Vote-On-Account for FY24-25. In an election year where stakes are very high, the government has resisted the temptation, once again, for populism and instead shown excellent strategic sense by opting to continue on the path of fiscal consolidation.

The government is building in a 10.5% nominal GDP growth for FY25, a healthy 12% growth in revenue receipts. However spending growth is just 6%, within which revenue spending is expected to grow just 3% while the more productive capex spending is expected to grow 17% to INR 11.1 Trillion.

The government’s commitment to a 4.5% Fiscal Deficit by FY26 is indeed commendable. Towards that effect, it has pencilled in a fiscal deficit of 5.1% for FY25, better than most economists’ estimates. This augurs well for overall economic credit creation as indeed for inflation and private capex revival.

The 17% increase in Capital Expenditure allocation on the back of a 3x increase over FY19-24 (from INR 3 trillion to INR 9.5 Trillion) indicates the continued thrust of the government towards infrastructure creation and driving the private investment cycle.

What is a bit of a dampener, however is lack of any big push for consumption. Consumption has been weak, especially in Rural India, as indicated by corporate earnings for last few quarters. The budget doesn’t provide any near-term solution for quick revival for consumption.

I continue to remain bullish in the medium to long term.”

Metals & Mining Industry (Stainless Steel): Mr. Anubhav Kathuria, Director, Synergy Steels Ltd:

“I see certain key factors in this budget. While the Hon’ble FM did not provide import duties-related measures, which the stainless-steel industry will eagerly look for in the full-budget due later, key policy announcements, including two crores more houses under the PM-Awas Grameen yojana, a new housing scheme for the middle-class, as well as the conversion of 40 thousand railway bogies to Vande-Bharat standards is expected to contribute to demand for various stainless-steel products in the medium-to-long term.

“The Government’s announcement for the conversion of 40 thousand Railway bogies to Vande-Bharat standards is a positive-step towards the upgradation of the railways. In this regard, we expect stainless steel to be looked upon as the metal of preference. Stainless steel coaches comparatively enable a host of benefits, including energy-efficiency due to weight-reduction, strength of rakes, and corrosion-resistance in context of coastal routes etc. Furthermore, the domestic availability and environmental friendliness of the alloy are further added benefits.”

India Cements clarified in an exchange filing that certain officials of the “Enforcement Directorate” visited its corporate office in Chennai on 31.01.2024 and 01.02.2024 and conducted a search to find out if any irregularities concerning “FEMA”. 

Stock tumbles by 6.16% on the NSE, trading at ₹245.30

Dhaval Ajmera, Director, Ajmera Realty & Infra India Ltd on the Interim Budget:

“The budget showcases a strong projection of India’s journey from developing to a developed nation, with multiple announcements focused on the socio-economic upliftment of the masses under the PMAY scheme through a strong development of real estate and infrastructure. The announcement of a housing scheme dedicated to middle-class citizens will empower the masses to shift to buying from renting, thus elevate the overall standard of living across the country. The Metro Rail and Namo Bharat expansion will influence the rapid spread of urbanization, thus leading to creation of micro-markets in and around metro cities.

In the pursuit of economic resilience, the Interim Budget also charts an ambitious course, unveiling a capital expenditure of Rs 11.1 lakh crore for FY25. With a prudent 11.1% rise in infrastructure spending, the budget echoes a commitment to aligning growth estimates. In addressing the pressing issue of deteriorating infrastructure, India’s imperative lies not in reduction but in a substantial increase in investment—a pivotal step towards a robust and sustainable future.

From a broader perspective, the First Develop India – FDI initiative will further propel development and infrastructural growth, adding significant value to job creation, emergence of new micro-markets, strengthening purchasing power, ultimately boosting the housing demand across India. “

V-Guard Industries reported standalone net profit for the quarter ended December 2023 at ₹46.62 crore as against ₹35.82 crore in the corresponding quarter ended Dec 2022.

Stock trades at ₹303.90 on the NSE, up by 3.93%

BCPL Railway Infrastructure Limited has signed an agreement for execution of an Engineering, Procurement and Construction (EPC) project under Alipurduar and Rangiya Division of N.F. Railway. Worth ₹526.62 million

Stock surged by 4.97% on the BSE, trading at ₹137.25

Ashish Gupta, CIO, Axis AMC: “While we did not expect any major announcements in this budget, the lower fiscal deficit coupled with higher capex outlay will aid continued momentum of India growth story. Both of these moves are enablers for a pickup in private capex cycle.” 

Raghav Iyengar, CBO, Axis AMC: “Bringing down fiscal deficit, higher capex and people focused, inclusive development will go a long way in boosting India’s long-term growth story.”

Shreyash Devalkar, Head Equity, Axis Mutual Fund: “It’s more an affirmation of the intent of the government, the capex outlay has been increased which is a positive. The government’s focus on infrastructure and housing will create a multiplier effect on the economy, maintaining a fiscally prudent budget.” 

Devang Shah, Co-Head, Fixed Income, Axis Mutual Fund: “Lower fiscal deficit and lower gross market borrowings are a positive for debt markets.”

Ashwin Patni, Head Products & Alternatives, Axis AMC: “Given the backdrop, no significant announcement was required. It just focused on continuity.” 

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Budget 2024 is a Holistic Budget exemplifying fiscal prudence and encompassing all the imperative sectors despite electoral compulsions. This budget gives credence to government’s unwavering resolve to adhere to the fiscal consolidation glide path, especially after having delivered robust growth-oriented budget in the last 3 years. The vision under Vikasit Bharat by 2047 and top 4 priorities laid out with respect to empowering Poor, Women, Youth and Farmers will go a long way in manifesting the long- term growth story of India. It is high on optics, low on spending impact as fiscal consolidation remains its paramount focus. The key announcements on power sector coupled with new energy, railways, defense, affordable housing is indeed encouraging. While optically 11% capex growth seems lower than 30% avg growth seen in the last 3 years, but it yet sticks to 3.4% of GDP, which is indeed credible as it would continue to give the requisite infra led push to sustain the growth momentum. Clearly the budget lacks any consumption and populus measures and is thus a departure from the previous pre-election Vote on Accounts. Fiscal consolidation focus, and low market borrowing reinstates the focus on macro-stability. With lower capex growth being the new reality , markets are likely to align to the pragmatic approach of the government and we reckon more policies being elaborated in July 2024 Budget. Bonds are likely to be in a favorable spot through 2025, thanks to the strong Fiscal prudence and lower borrowing pressures coupled with supportive FII flows with global bond inclusion. Overall, the government has dexterously done a fine balancing act between adhering to fiscal prudence and giving requisite support to growth, despite being a Pre-Election Budget.

Orient Electric has declared an interim dividend of ₹0.75 per equity share. The company reported a net profit for the quarter ended Dec 2023 at ₹24.33 crore as against ₹32.56 crore in Dec 2022.

Shares rise by 2.49% on the NSE, trading at ₹214.25.

Major gainers of such stocks:

PSB (4.03%)

Indian bank (3.91%)

Union Bank (3.72%)

IOB (3.67%)

FM’s interim budget is balanced from the point of view of adhering to fiscal prudence, boosting infrastructure growth and prioritizing focus on four key sections of the economy - the poor, women, youth and farmers. We believe the FM’s focus on higher outlay for infrastructure will help in boosting the broader economy and in the long term will boost investment activity. The government’s support to MSMEs, women entrepreneurs and the agricultural sector aptly aligns with our aim to provide credit support to MSMEs, small business owners, farmers and women entrepreneurs thereby addressing their economic needs. FM’s focus on addressing housing challenges by building two crore additional homes under the PM Awas Yojana-Grameen is certainly positive for boosting the housing sector. While inflation has been a concern globally, FM’s focus on staying on the path of fiscal prudence in the interim budget, will surely be an enabler for stable interest rate scenario in the economy and bodes well for the overall financial sector.

“As expected, VIX has cooled off after the budget event which primarily has been a non-event for most of the market except PSU Banks and Auto stocks which have seen most of the buying action. Nifty still trades near to its resistance area of 21,750 - 21,800 along with dominant shorts in index futures from FII’s. Bulls have to clear this area for any further action on the upside. Supports placed at 21,450 and 21,200”

“The integration of mandis into the Electronic National Agricultural Market signals a monumental step towards inclusive growth for our farmers. The government’s unwavering support for ‘Anna Datas’ through schemes like PM Kisan Samman Yojana and PM Fasal Bima Yojana showcases a commitment that resonates with the agricultural backbone of our nation.

The emphasis on value addition and income enhancement, as exemplified by schemes like Pradhan Mantri Kisan Sampada Yojana and PM Formalization of Micro Processing Enterprises Yojana, is truly uplifting. These efforts are not just about economic benefits; they represent a profound investment in the prosperity of our farming communities.

The focus on post-harvest activities and the promotion of private and public investments demonstrate a holistic approach to the agricultural sector’s development. As we look ahead, the expansion of Nano DAP application and the Aatma Nirbhar Oilseeds Abhiyan instill confidence, aligning with our aspirations for a self-reliant and thriving agricultural landscape.”

Finance Minister Nirmala Sitharaman’s Interim Budget 2024 is a strategic blueprint guiding India towards the ambitious goal of a $5 trillion economy. It notably targets a fiscal deficit reduction to 5.1% from the anticipated 5.3%, signifying a commitment to aggressive fiscal consolidation. This, along with a reduction in FY25 gross borrowing to ₹14.13 trillion, indicates a promising trajectory for economic stability, benefiting the general populace by potentially easing inflation and enhancing public welfare.

Key highlights include a focus on indigenous oilseed development to curb the hefty ₹1.5 trillion annual import bill on cooking oil, aligning with the ‘Bharat’ ethos of self-sufficiency. The budget also introduces a housing scheme for the middle class, a significant move towards fulfilling the quintessential Indian dream of homeownership.

Healthcare initiatives are expanded under the Ayushman Bharat scheme, now encompassing Anganwadi workers and helpers, reflecting the government’s dedication to foundational economic sectors. However, maintaining status quo on tax rates, including import duties, might temper taxpayers’ expectations for relief.

In essence, the budget envisions a ‘Viksit’ Bharat by 2047, a narrative of empowerment and multifaceted economic development. It’s an invitation for investors and the public to engage in Bharat’s story, set to define 2024 and beyond as a time of ‘golden moments’ and unparalleled growth.

“The Interim Budget 2024-2025 signifies a landmark commitment to fiscal discipline, highlighted by a projected GDP of 5.1%. This stance is set to buoy the bond market and fortify banks’ mark-to-market valuations. With Capex outlays increasing by 12% to 11 lakh crore and sunset tax laws extended to March 2025, the economic landscape gleams with promise. Initiatives to address post-harvest distress in agriculture, rural development, and the Rooftop Solar scheme underscore a transformative journey towards inclusive growth and sustainability.”

“The fiscal deficit in 2024-25 is estimated to be 5.1% of GDP. The gross and net market borrowings through dated securities during 2024-25 are estimated at 14.13 lakh crore and 11.75 lakh crore, respectively. Both lesser than that in 2023-24. This budget clearly demonstrates that under promising and over delivery. This budget is fantastic from Stock Market perspective.”

‘Messaging Aimed at Elections’: A closer look at the white paper comparing 2014-15 with present achievements and its implications for the upcoming elections.

‘Tax Relief for 10 Million’: Withdrawal of pending tax demands up to ₹25,000 till 2009-10 and ₹10,000 till 2014-15 to benefit a significant number of taxpayers.

‘Steadfast on Income Tax’: No changes in income tax, signaling government confidence and stability in the interim budget.

‘Fiscal Discipline Surpasses Expectations’: A positive surprise with a fiscal deficit of 5.8%, beating expectations and setting a target of 5.1% for 2024-25.

‘Productive Spending on Cap-Ex’: A welcomed 11% increase in capital expenditure to around 11.1 lakh crore, emphasizing productive spending.

‘Green Initiatives for Energy’: Rooftop solarisation to benefit 1 crore households, offering up to 300 units of free electricity and potential savings of Rs. 15,000 - Rs. 18,000.

‘Empowering Electric Vehicles’: Opportunities in entrepreneurship and employment through the promotion of electric vehicle charging infrastructure.

‘Boosting Post-Harvest Activities’: Government commitment to private and public investment in post-harvest activities, including storage, supply chains, processing, marketing, and branding.

‘Holistic Maternal and Child Health Care’: Integration of various schemes under one comprehensive program for maternal and child health care.

The impetus given to post-harvest activities in the interim budget is a welcome step. It is a positive move to encourage private-public partnerships and address the diverse ambits of post-harvest agricultural logistics, including storage, supply chain as well as primary and secondary storage. We also endorse the government’s renewed focus on women empowerment to transform India’s rural socio-economic landscape. In addition to the 1 crore women already coming under the purview of Lakhpati Didis, the government now intends to incorporate 3 crore new Lakhpati Didis under the scheme, and we hope it transforms several lives in the Indian agri space across the rural parts of the country.

Tube Investments of India reported its standalone net profit for the quarter ended Dec 2023 at ₹157.50 crore as against ₹137.71 crore in Dec 2022.

Shares trade at ₹3,869.30 on the BSE, down by 0.75%.

The Fiscal deficit of 5.1 and total gross borrowing is Rs 14.13 Lakh crores, the total net borrowing is at Rs 11.75 Lakh crores. The Nominal Growth in expected to be 10.5 % and tax revenue growth is expected to grow by 11.93%, which is a conservative estimate. The total non-tax revenue has been budgeted at Rs 1.53 Lakh Crores same as last year. The numbers look realistic as the assumption are realistic. The capital expenditure is targeted at Rs 11.11 lower than market expectation of Rs 12 Lakhs. The Finance minister stated they want to get fiscal deficit below 4.5 % in 2025-26. This is anti-inflationary budget in an election year as the fiscal deficit is reduced from 5.8 percent to 5.1 percent.. The finance ministry is clearly aiming for rating upgrade with aggressive fiscal deficit reduction target as we are at investment grade rating. The ten-year yield have come down to 7.05 to 7.08 levels from 7.15 levels. Further drop in yields is expected due to flows from foreign institutional investors and expectation of India’s rating upgrade.

“Though the FM has not raised the cap on the affordable housing segment, the government’s focus on middle-class housing by announcing a scheme to help them buy or build their own houses will boost the country’s housing sector and home loan market. The higher allocation to PM Aavaz Gramin will also be beneficial for the rural housing segment. The measures will also stimulate the core sector output demand and rural jobs. Overall, it is a growth-oriented Budget, which is planning to spend 3.4% of the GDP for capital expenditure. It is an 11.5% hike compared to the previous year. I hope that the government’s greater emphasis on rooftop solar, green energy, MSMEs, food processing industries, Rs 1-lakh crore innovation fund, railway economic corridors, aviation, tourism and medical education will further stimulate growth and it will hasten the economic activities across sectors.”

Kamdhenu Ltd informed that Vinod Kumar Gahlaut has been appointed as Senior General Manager w.e.f February 1, 2024. 

Shares trade at ₹562.55 on the BSE, up by 0.05%

Tata Motors Limited sales in the domestic & international market for January 2024 stood at 86,125 vehicles, compared to 81,069 units during January 2023.

The stock trades at ₹586.75 on the NSE, up by 0.47%.

Indian Railways through three upcoming Railway corridors - the energy, mineral and cement corridor, the port connectivity corridors, and the high traffic density corridors – will look to improve efficiency and reduce cost, Finance Minister Nirmala Sitharaman said.

The government announced a lower-than-expected bond sales program for the next fiscal year, as the nation prepares for big foreign inflows on global index inclusion. Bonds rallied. 

SML ISUZU Ltd has recorded sale of 1320 units of cargo and passenger vehicles in Jan 2023-24, as against 771 units in 2022-23.

Stock surged by 5.44% on the NSE, trading at ₹1,455.95

Shares of state-owned HUDCO jumped 6 per cent in the mid-session trade on Thursday after Finance Minister Sitharaman announced building 2 crore more houses for the rural poor in the next five years.

The state-run Housing and Urban Development Corporation (HUDCO) provides financial assistance for housing and urban infrastructure development projects.

The scrip of housing finance and infrastructure company climbed 6.14 per cent to trade at Rs 183.10 apiece on the BSE.

On the NSE, shares of HUDCO rose 6.12 per cent to trade at Rs 182.90 per piece.

The stock hit its 52-week high of Rs 189.65 apiece on BSE and Rs 189.70 per share on the NSE.

Post the Budget announcements, shares of construction company NBCC (India) advanced 4.98 per cent to trade at Rs 135.85 apiece on the BSE. The scrip gained 3.59 per cent to trade at Rs 134.10 per piece on the NSE.

During the intra-day trade, NBCC shares also hit a 52-week of Rs 139 apiece on the BSE and the NSE each.

In the mid-session trade, the 30-share BSE Sensex fell 25.46 points or 0.04 per cent to trade at 71,726.65, while NSE Nifty slipped 0.02 per cent to trade at 21,720.95.

In her interim budget speech on Thursday, Finance Minister Nirmala Sitharaman announced a scheme to help those living in rented accommodation or slums to acquire a house.

Parallely, she also announced building of 2 crore more houses for the rural poor in next five years under the continuing PM Awas Yojana (Grameen).

“Our Government will launch a scheme to help deserving sections of the middle class ‘living in rented houses, or slums, or chawls and unauthorized colonies’ to buy or build their own houses,” Sitharaman said.

“Despite the challenges due to COVID, implementation of PM Awas Yojana (Grameen) continued and we are close to achieving the target of three crore houses. Two crore more houses will be taken up in the next five years to meet the requirement arising from increase in the number of families,” she said.

The overall target is to construct 2.95 crore pucca houses with basic amenities by March 2024. - PTI

Ankur Gupta, Practice Leader - Indirect Tax at SW India

Although the FM (Finance Minister) stated that there are no alterations in rates for customs or GST, modifications have indeed been introduced in GST laws. The amendment will be effective once the notification is issued after finance bill receives assent from President of IndiaThese changes now mandate the acquisition of registration as an Input Service Distributor (ISD) for the distribution of credit related to input services. Consequently, the practice of cross-charging common expenses will be replaced by the ISD, necessitating companies with a nationwide presence in India to obtain ISD registration for the distribution of credit among branches. This amendment reflects a shift in the mechanism for handling credit distribution for input services within companies operating across the country.

Saurrav Sood, Practice Leader - International Tax and Transfer Pricing at SW India

No major changes in the direct tax aspect. However, timelines for certain exemptions which were expiring in March 2024 have been extended to March 2025 now. Such an extension will benefit start-ups and units operating in the International Financial Services Centre. Other than that, the budget proposes to introduce provisions to write off old tax demands up to ₹ 25,000 till AY 2009-10 and ₹ 10,000 up to FY 2014-15 as a one-time relief to taxpayers. Further, there are no announcements on Pillar 2 nor there is an inclusion of transfer pricing assessment under a faceless regime.

“This was a fantastic budget and the focus was on next 50 years instead of next year. Right from thinking of GIFT city as a doorway to trade 300 years later to focus on a developed Bharat. Its not difficult to imagine that most of the 1 lakh crore interest free loans will go to states that support tourism which are primarily ruled by BJP. This ensures continued capex into states where BJP is in power. Agri as expected in terms of post-agri processing, fishreries and oil seeds stood out. The path to fiscal consolidation means Indian bond yeilds will remain range bound till election. Freeing up of tax litigations dating back to 1962 to benifit 1 crore tax payers and also free up department time to persue more serious offences. Finally, the dream to own houses for most renters will once fulfilled put downward pressure on rental assets - which is a positive for redevelopment schemes and relators in general. The goal to upgrade 40000 wagons - will see demand from various wagon processing companies - which continues to feed into the positive story around railways.”

“Biggest strength of this budget is the fact that the fiscal deficit is set @5.1% which is significantly lower than expected. Also maintaining the focus on infrastructure development and capex is a positive factor. Plan to focus on the Rural housing program will have multiple constructive effects on the economy as many ancillary industries are linked to housing. Another positive factor is allocation of 1 lakh cr for R&D and innovation. Overall, this demonstrates continued focus on fiscal consolidation and Macro-economic development.”

“In agriculture, support for post-harvest investments, dairy farmers, disease control, and crop insurance highlights a commitment to the sector’s growth. Healthcare accessibility is set to improve with the extension of Ayushman Bharat and the plan to establish hospitals in all districts. The budget also prioritizes social security and social inclusion through initiatives that empower women, youth skill development, and renewable energy.

Furthermore, the emphasis on social inclusion ensures that marginalized populations are not left behind, reflecting the government’s dedication to reform, perform, and transform for inclusive growth and development. It addresses various sectors and challenges while emphasizing the welfare of all citizens and the country’s overall progress.”

The union budget presented today by the honourable Finance Minister has further strengthened the government’s commitment towards long- term social and infrastructure development. Though it is an interim budget due to the impending elections, today’s announcements by the Union Finance Minister are significant in many aspects. The 11.1% increase in infrastructure outlay which is 3.4% of GDP will further enhance the railway, roads and logistics infrastructure of the country. The three new economic railway corridors identified under the PM Gati Shakti program are massive projects with the potential to grow economic hubs and boost development of the tier-2 and tier-3 cities along their alignment. The intention to complete 2 cr housing units in the next five years will aid the ‘Housing for All’ mission of the government. Additionally, the proposed boost to housing for the middle-class living in sub-par accommodation is also a welcome inclusion. We look forward to the details of this as we expect this to have great long-term ramifications. Further, the enhanced focus on domestic tourism development will provide a fillip to the hospitality industry.”

ION Exchange in receipt of contract from Material Construction Trading FZCO, UAE for a Project in North Africa at a contract value of ₹152.46 crore plus VAT. The project is to be completed within 8 months from the date of Letter of Acceptance. 

Shares up by 2.88% on the NSE, trading at ₹524.90

Government has walked the path of fiscal prudence, and it is heartening to note that the fiscal deficit target for FY24, pegged at 5.8%, will be overachieved. The fiscal deficit being pegged at 5.1% for FY25 is a positive move as it will help free up space for private borrowings as they pick pace during the year, besides helping in containing inflationary pressures and supporting the bond markets. The additional allocation of INR 1.1 trillion for capex, taking it to INR 11.1 trillion, should provide continuity in the pace of infra creation and in bringing down the logistics cost in the country progressively.

The most important announcement about the Railways was about the 3 new corridors.

The Railway Sector got a very critical support with the announcement of 3 new corridors: Energy, Mineral & Cement Corridor; Port connectivity corridor; and high traffic density corridor. These 3 basically are going to ease up resources transport in the first 1 thus reducing the cost of manufacturing in the economy, the second will allow for larger exports and the third will result in decongestion and more efficiency for goods and passengers in high traffic zones

The focus on logistics and infrastructure continues with this under the PM Gati Shakti as enabling infrastructure for economic growth.

Conversion of 40,000 normal bogies to Vande Bharat is also a positive for the sector.

Overall, Large capex announcement of 11.1 lakh crore is a huge positive and continues supporting the overall enabling infrastructure theme of Amrit Kaal.

Budget 2024 brought forth several key announcements aimed at bolstering infrastructure, healthcare, and housing, alongside initiatives to support MSMEs and promote technological advancements in defense. Notably, the commitment to affordable housing through the launch of a new scheme for the middle class and the emphasis on next-generation reforms underscore the government’s focus on sustainable development and economic inclusivity. The budget’s approach to maintaining stability in tax rates while enhancing the ease of doing business reflects a strategic balance between fostering growth and ensuring fiscal prudence.

The market’s reaction to these announcements has been mixed, with positive movements in the FMCG sector, attributed to measures expected to boost consumer spending power. Conversely, railway stocks saw a decline, possibly due to concerns over the execution and immediate impact of the infrastructure projects announced. Overall, the muted market response underscores a cautious optimism, with investors looking for more clarity on the implementation of budget proposals.

Looking ahead, the effectiveness of Budget 2024 will largely hinge on the government’s ability to execute its outlined plans efficiently. The focus will be on translating policy announcements into tangible outcomes that stimulate economic growth, enhance sectoral performance, and bolster investor confidence in the Indian market’s long-term potential.

“The FM has continued to focus on strengthening of domestic macro factors including sustained investments in Infra, Agriculture, Domestic Tourism, and also sticking to fiscal responsibility with a lower fiscal deficit which could be music to the ears of foreign investors and impending $25 billion bond inclusion in June as lower budget deficits and pared borrowings will help bring down yields. It could possibly open the door for a ratings upgrade.

Key features of the budget are focus on infrastructure, tourism, logistics and innovation in research. All these measures will bring continuous sustainable growth of the economy. This shows the continued commitment of the existing government to move towards bringing fiscal prudence and reaching to the targeted fiscal deficit of 4.5% of GDP by FY26.”

The continuity of policy in supporting food and agriculture sectors is encouraging. The new proposals of PPP Projects in post harvest management and value addition will help unlock entrepreneurship and value in the supply chain. In addition, entrepreneurs and startups are keenly looking forward to understanding the details of the proposed soft loans for R&D programs. This will help in creating explosive growth by driving innovation, and expedite reforms in sectors of national importance like food and agriculture.

JBM Auto (1.14%)

Samvardhana Motherson International (1.50%)

BOSCH (0.55%)

Amara Raja Energy & Mobility (-0.70%)

Exide Industries (-1.84%)

“The government has clearly laid out the fiscal deficit path for next two years, and this is one of the highlights of the interim budget. The tax to GDP ratio has improved which gives the confidence to spend more and is a major contributor to the glide path for fiscal deficit. Secondly the continued focus on infrastructure and affordable housing is a big positive. Overall it’s a growth-oriented budget.” - Venkatraman Venkateswaran - Group President & Chief Financial Officer at Federal Bank

“In an election year, the budget adeptly strikes a balance, prioritizing sensibility over populism. It showcases India’s unwavering commitment to infrastructure development, coupled with a steadfast adherence to fiscal prudence. This paves the way for sustained growth, steering the nation along the trajectory towards achieving a developed economy by 2047.” - Trideep Bhattacharya, President & Chief Investment Officer- Equities, Edelweiss MF

“The FY2024 RE has indicated a higher amount of central tax devolution compared to the BE as well as our estimate. This implies that Rs. 3.6 trillion is left to be released in Q4 FY2024 (5% higher than Q4 FY2023), which we believe provides a further downside to SGS issuance in the current quarter (indicated: Rs. 4.1 trillion, ICRA’s initial est: Rs. 3.5 trillion).”

“The government has stuck to the path of fiscal prudence and it was a welcome surprise to see fiscal deficit revised estimates to be at 5.8% and a glide path towards 5.1% and 4.5% over the next two years. Also, growth in tax assumptions are below 12%, which is conservative and gives the government reasonable elbow room to continue its investment oriented growth plans.” - Aniruddha Naha, CIO – Alternates, PGIM India Asset Management

Two broad themes of this budget are fiscal consolidation and stepping up focus on agriculture/rural to course correct to some extent the differential benefit of the ongoing economic growth which is tilted in favor of households of upper income bracket/urban areas. The first impression from the budget speech and fiscal deficit numbers for FY24 and FY25 suggests that the government is serious about achieving the fiscal consolidation path of 4.5% fiscal deficit by FY26. The nominal GDP growth assumption and revenue buoyancy appears plausible and in line with our expectations. The net market borrowing of INR11.75 trillion in FY25 augurs well for the bond market and likely to have favorable impact on 10-yr gsec yields. - Devendra Kumar Pant, Chief Economist & Senior Director– Public Finance, India Ratings and Research

For many years, I have been saying that we create too much drama around the budget and raise expectations of policy announcements to an unrealistically feverish pitch. The Budget is NOT necessarily the occasion for transformational policy announcements. Those can, and should, happen throughout the year. Just as it is for all private households, the Budget is an opportunity to plan our finances prudently and with fiscal rectitude. The more we are focussed on living within our means and investing for a robust but sustainable future, the more confidence we will gain with global investors. Which is why I was pleased with today’s budget.

IRCTC (-1.06%)

IRFC (-1.51%)

RVNL (-2.87%)

Railtel Corp (-2.46%)

Ircon International (-2.34%)

Titagarh Rail (-1.55%)

Texmaco Rail (-1.55%)

No gimmicks, no populism. Conservative macro-economic management. Fiscal deficit to decline from 5.8% to 5.1% of GDP as post-Covid consolidation continues. Continued emphasis of infra capex combined with directly targeting absolute poverty with housing/health etc. #Budget2024

“By presenting a fiscally prudent Budget, the government has created conducive conditions for the private capex cycle revival. A strong push given to rural housing and agri-allied activities augurs very well for the business model of retail-oriented NBFCs. Today’s Budget will improve the international investors’ perception about India’s macro-financial stability and strengthen India’s position as one of the best investment destinations in the global space.”

The budget is fully aligned to vision 2047 with GDP defined as Governance , Development & Performance on the principle of reform, perform and transform. The path to fiscal consolidation with fiscal deficit pegged at 5.1% shows government commitment to its promises . Overall a fascinating budget covering all sections of society especially towards the research and innovation initiatives by our youth.

Adani Ports and Special Economic Zone has reported its standalone net profit for the quarter ended Dec 2023 at ₹525.49 crore as against ₹11.40 crore in the corresponding quarter ended Dec 2022

Shares rose by 1.15% on the NSE, trading at ₹1,221.50

The Interim Budget 2024 has begun on a very positive note. Finance Minister Seetharaman’s announcement of the government setting a capex target of Rs. 11.1 lakh crore for FY25 is sure to have a ripple effect across industries. AIFs can leverage the momentum by focusing on MSME investment, particularly in the infrastructure and agriculture sectors. Start-up ventures aligned with the government’s priority sectors can expect to receive significant boosts, as increasing infrastructure development creates an environment conducive to innovation and growth. The 50-year interest-free loan for a corpus of Rs. 1 lakh crore can be seen as an indispensable boon for the IT industry and sunrise sectors. We can expect the funding to bolster research and innovations, thereby improving India’s position as a global technology leader in the coming decade.

Quote focused on Foreign Trade - “India’s entry into the Kartavya Kal has been announced with the India Middle East-Europe trade corridor which supports India’s unfettered commitment to national development and ambitious vision to transform into a developed nation by the centenary of its independence in 2047. This corridor is expected to positively impact and facilitate world trade and India’s trade in GCC region.”

Quote focused on MSME - “Keeping up with the promise of First Developed India (FDI), the 2024 Union Budget has prioritized strengthening and aiding the MSME sector to compete in the global market by meeting their investment needs, improving/ advancing the technology and liberalizing the regulatory space. With India being the hub of global trade, empowering small and medium businesses to compete in the global market was a much awaited move.”

Union Budget 2024-2025: https://www.indiabudget.gov.in/doc/Finance_Bill.pdf

Budget Speech: https://www.indiabudget.gov.in/doc/budget_speech.docx

Budget Highlights (Key Features): https://www.indiabudget.gov.in/doc/bh1.pdf

Key to Budget Document: https://www.indiabudget.gov.in/doc/Key_to_Budget_Document_2024.pdf

Statements of Fiscal Policy: https://www.indiabudget.gov.in/doc/frbm1.pdf

Implementation of Budget Announcements 2023-2024: https://www.indiabudget.gov.in/doc/impbud2023-24.pdf

As expected, the interim budget did not usher any surprises with no myopic measures announced. The government continued with its focus on infrastructure and increased the capex outlay by 11% covering railways, ports and aviation sectors. The government has walked the tight rope and followed a further fiscal consolidation path by promising to manage its finances well for FY25. The government did not bow down to the populist measures in the election year and kept the tax regime unchanged. Our overall reading is that the government has shown prudence in managing the various facets of economy and remains committed to the long-term vision of making India a developed economy by 2047. - Swapnil Shah, Director-Research, StoxBox

Prism Johnson has reported standalone net profit for the quarter ended Dec 2023 at ₹1.78 crore as against loss of ₹44.74 crore in the corresponding quarter ended Dec 2022.

Shares trade at ₹179.90 on the NSE, down by 0.47%

India Cements has reported standalone net loss for the quarter ended Dec 2023 at ₹16.51 crore as against profit of ₹90.73 crore in the corresponding quarter ended Dec 2022.

Stock declined by 5.28% on the NSE, trading at ₹247.60

“The hallmark of this interim Budget is its fiscal rectitude. The fact that the Government has prioritised fiscal consolidation over populism on the eve of general elections is commendable. The fiscal deficit numbers of 5.8 % in the revised estimates for FY24 and 5.1% for FY25 are better than the most optimistic expectations. This is very good news for the economy and consequently for the market. The boost to housing is another important proposal from the market perspective since this will benefit industries like cement, steel and all construction related segments.” - V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

As expected, the interim budget did not usher any surprises with no myopic measures announced. The government continued with its focus on infrastructure and increased the capex outlay by 11% covering railways, ports and aviation sectors. The government has walked the tight rope and followed a further fiscal consolidation path by promising to manage its finances well for FY25. The government did not bow down to the populist measures in the election year and kept the tax regime unchanged. Our overall reading is that the government has shown prudence in managing the various facets of economy and remains committed to the long-term vision of making India a developed economy by 2047.

Swapnil Shah, Director-Research, StoxBox

Union Budget quote on behalf of Mr. Rajesh Narain Gupta, Managing Partner of SNG & Partners, Advocates & Solicitors

‘Huge incentives to the private sector for innovations by creating a new fund exceeding one lakh crore and further a deep focus on infrastructure development by increasing the overall provisions as well as steps being taken towards rural, women and farmers development are astounding steps which will accelerate India becoming a developed nation’.

Manoj Purohit, Partner & leader - FS Tax, Tax & Regulatory Services, BDO India

“The government has continued its support to farmers under the crop insurance facility and intends to further strengthen the same. This will ensure penetration and awareness around insurance in rural India thereby providing a boost to the insurance industry.”

Manoj Purohit, Partner & Leader, Financial Services, Tax & Regulatory Services, BDO India

IFSCA positioned as a hub for global capital participation. Recent permission for direct listing by Indian companies is a step in this direction

Siddharth Tandon, Partner, Indirect Tax, BDO India

“Expansion of existing airports and the development of new airports along with the extension of UDAAN scheme for regional connectivity would remain an area of key focus aiding tourism and development.”

Maulik Manakiwala, Partner, Indirect Tax, BDO India

“In a move towards promoting a shift to Electric Vehicles (EV), the focus on expanding the EV charging network continues. This will also increase opportunities for a large number of small vendors for manufacturing, installation and maintenance of EV charging networks.”

Jiger Saiya, Partner & Leader, Tax & Regulatory Services, MSKA & Associates – a member firm of BDO International

“The continued focus on capex outlay at around 3.4% of GDP will certainly help boost economic activity and serve the long-term vision of Viksit Bharat.”

The development of commodity-specific economic rail corridors can de-congest existing lines, mostly in the eastern part of the country. This is supportive of faster freight movement and turnaround times and should help reduce the logistics cost for India from 12% of GDP, improving competitiveness, especially manufacturing, against peers.

“Infrastructure Investment: The Finance Minister announces a modest 11.1% increase in India’s infrastructure spending, aligning closely with the nominal growth estimate. However, to address the challenges of deteriorating infrastructure, India must consider a more substantial increase in investment rather than a reduction.” - Pradeep Gupta, Co-founder & Vice-chairman, Anand Rathi Group

Major gainers on the NSE at noon

Maruti (3.56%); Power Grid (2.70%); Cipla (1.92%); M&M (1.91%); TCS (1.59%)

Major losers:

Dr Reddy’s Lab (-2.40%); ONGC (-1.88%); Grasim (-1.75%); L&T (-1.74%); Ultratech Cement (-1.69%)

Stocks advanced on BSE at 12 noon on Feb 1, 2024, were 1,722 against 1,962 stocks that declined; 136 stocks remain unchanged. Total stocks traded were 3,820. The number of stocks that recorded a 52-week high was 397, and those that hit a 52-week low was 13.

Propose to withdraw outstanding direct tax demands ₹25,000 - FY up to 2009-2010; up to ₹10,000 - FY 2010-11 to 2014-15 to benefit about 1 cr tax payers

A provision of Rs 75,000 Crores as a 50-year interest-free loan is proposed this year to support those milestone-linked reforms by the state governments

SAMCO Securities:

The government increased the capital investment outlay for the 4th time in arow allocating 11.11 lakh crores, up 11.1% The increased investment is poised to stimulate private capital expenditure, which still hasn’t picked up the pace as expected. This surge in investment will not only drive economic growth but also create increased employment opportunities, aiding rural India for higher consumption too.

Negotiating bilateral investment treaties should further boost foreign investments into India. FDI newly coined as ‘First Developed India’ - Sandeep Jhunjhunwala, Partner, Nangia Andersen LLP

CRISIL View: The 11.1% higher capex budgeted for infrastructure is lower than what has been the run rate in the previous years. This implies the private sector will have to step in if the growth momentum has to be maintained.

Arvind Smartspaces Limited (ASL) has signed a new plotted development project in Ahmedabad, with a total estimated area of 40 acre and a top-line potential of ₹250 crore. This project is located in Lakshmanpura, Ahmedabad and is acquired on an outright basis. 

Arvind Smartspaces has also signed an agreement for a large horizontal (plots and Villas) multiuse golf themed development project in Surat, with a total estimated area of ~300 acre and a top-line potential of ₹1,100 crore.

The stock trades at ₹529.15 on the NSE, down by 1.17%.

Energy, mineral, Port connectivity

High-traffic density corridors 

PM Gati Sakthi, improve logistics effeciently and reduced cost

40,000 normal rail bogies will be converted to Vande Bharat standards.

“The government has continued its support to farmers under the crop insurance facility and intends to further strengthen the same. This will ensure penetration and awareness around insurance in rural India thereby providing a boost to the insurance industry.”

Finance Minister Nirmala Sitharaman on Thursday said 25 crore people got freedom from multi-dimensional poverty in the last 10 years.

Earlier approach of tackling poverty through entitlement resulted in very modest outcomes, she said while presenting the interim Budget in the Lok Sabha.

There is transparency and assurance that benefits are transferred to all eligible citizens, Sitharaman said.

The National Education Policy is ushering transformational reforms, she added. - PTI

Finance Minister Nirmala Sitharaman on Thursday expressed hope that the BJP-led government will be blessed again by the people with a resounding mandate in the forthcoming general elections.

“Based on stupendous work, we expect our government will be blessed again by the people with a resounding mandate,” she said.

She also said India overcame challenges of Covid-19, created foundations for self-reliant India.

All sectoral indices on the NSEexcept Nifty auto, FMCG, and IT, trade in red.

Nifty Realty at 845.50; down by 10.70 pts or -1.25%

The government has extended 43 crore loans aggregating to ₹22.5 lakh crore were extended under the PM Mudra Yojana, Finance Minsiter Nirmala Sitharaman said on Thursday.

Manufacturing sector growth climbed to a four-month high in January as a sharper upturn in new orders boosted output growth amid mild cost inflation, a monthly survey said on Thursday.

The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) recovered from an 18-month low of 54.9 in December to 56.5 in January.

The latest reading highlights the strongest improvement in the health of the sector since last September.

Maruti (4.39%)

Eicher Motors (2.02%)

M&M (1.84%)

Major gainers on the BSE:

Infibeam (11.43%); Godrej Properties (11.21%); SCI (9.07%); KPI Green (8.56%); Motherson Sumi (8.08%)

Major losers:

Paytm (-20%); Fusion (-9.76%); Auro Pharma (-8.03%); India Cements (-7.02%); Gravita (-6.23%)

Stocks of companies related to railways were trading in the positive territory on Thursday morning ahead of the presentation of the interim Budget.

Shares of IRCON International rallied 3.26 per cent, Texmaco Rail & Engineering jumped 2.71 per cent, Indian Railway Finance Corporation climbed 2.58 per cent and Rail Vikas Nigam advanced 1.52 per cent on the BSE.

The stock of Jupiter Wagons went up 1.46 per cent, Indian Railway Catering and Tourism Corporation (IRCTC) (0.88 per cent) and Titagarh Rail Systems (0.71 per cent).

“In railways, we anticipate a surge in investment, unveiling transformative projects and introducing 300-400 Vande Bharat trains,” Suman Bannerjee, CIO of Paris-based hedge fund Hedonova, said.

In the equity market, the 30-share BSE Sensex rose 118.59 points to 71,870.70 points and the Nifty quoted 68.20 points up at 21,789.90 points. - PTI

Indian equity markets witnessed strong gains ahead of the domestic Interim Budget 2024 and the U.S. Federal Reserve’s meeting outcome. Despite lower expectations for any major announcements from the Interim Budget, market participants remained optimistic that capital expenditure to maintain the momentum of growth along with a lower fiscal deficit supported by buoyant tax revenues.

Bond yields fell as market participants remained optimistic over a fiscally prudent Union Budget announcement. Ease in U.S. Treasury yields towards 4%, extended the gains further.

The yield on the 10-year benchmark paper (7.18% GS 2033) fell by 2 bps to close at 7.14% as compared to the previous close of 7.16%.

Crude oil futures traded higher on Thursday morning as the US Federal Reserve pointed at possible interest rate cuts in the coming months. Added to this, official data showed a decline in crude oil inventories in the US.

Finance Minister Nirmala Sitharaman will be presenting the pre-election Budget which would list out achievements of the Modi government in the past 10 years, while giving a glimpse of the future plans to make India a developed nation by 2047.

All eyes will be on whether Sitharaman will deliver a populist budget leaving more money in hands of the common man or push the reform agenda by staying on the fiscal glide path to lower the fiscal deficit to 4.5 per cent of GDP by 2025-26.

Sitharaman, who would be presenting her sixth straight budget, had in her first Budget in 2019 replaced the leather briefcase -- which had been in use for decades for carrying budget documents -- with a traditional ‘bahi-khata’ wrapped in red cloth. This year’s Budget would be in paperless form, as done in the last three years.

Here are the key numbers to watch for in pre-election Budget 2024-25: * Fiscal Deficit: The budgeted fiscal deficit, which is the difference between the government expenditure and income, for the current fiscal ending March 2024 is 5.9 per cent, against 6.4 per cent in the last fiscal. The number for 2024-25 would be in focus as it is widely expected that the government would open its purse strings in an election year.

The budgeted fiscal deficit of 5.9 per cent of gross domestic product (GDP) for the current fiscal is likely to be achieved, but it is nearly twice the Fiscal Responsibility and Budget Management Act (FRBMA) fiscal deficit to the GDP target of 3 per cent for the central government. Correspondingly, the debt-GDP ratio at 54 per cent is also well above the target of 40 per cent.

* Disinvestment/Privatisation: In current fiscal year the budgeted disinvestment target is likely to be missed, like the past five years. It is expected the government would set a realistic target of sub-Rs 50,000 crore for next fiscal.

* Capital Expenditure: The government’s planned capital expenditure for this fiscal year is budgeted at Rs 10 lakh crore, higher than Rs 7.3 lakh crore in the last fiscal. The government has been pushing infrastructure creation and also incentivising states to step up capex.

* Tax Revenue: The Budget had pegged direct and indirect tax mop-up at Rs 18.23 lakh crore and Rs 15.29 lakh crore for current fiscal, taking the gross tax collection to Rs 33.61 lakh crore. The government’s tax revenues are expected to overshoot the budget estimates on buoyant collections in GST; and income and corporate tax.

* Borrowing: The government’s gross borrowing budget was at Rs 15.43 lakh crore in the current financial year ending March 31. The government borrows from the market to fund its fiscal deficit. The borrowing number would be watched by the market, especially on the back of expected higher capital expenditures to boost growth and populist announcements.

* Nominal GDP: India’s nominal GDP growth (real GDP plus inflation) in the current fiscal is estimated to be 11 per cent. The Budget is expected to give an outline on the nominal GDP growth numbers. Real GDP growth in current fiscal is projected at 7.3 per cent and 7 per cent in the next.

* Spotlight would also be on spending on key schemes, like NREGA, as well as key sectors like health and education. - PTI

Ferro-chrome miner, IMFA Ltd, expects economic uncertainties in European markets – a key consumer that continues to determine global price movements of the metal – would impact chrome prices by 6-7 per cent in Q4FY24 (January–March). The company is, however, hopeful that prices would remain range-bound to the tune of Rs 100,000 per tonne in FY25.

Steel Strips Wheels Ltd has recorded net turnover of ₹380.47 crore in January 2024 as against ₹345.89 crore in January 2023, recording a growth of 10% y-o-y.

Shares trade at ₹278.60 on the NSE, down by 0.43%.

Mahindra & Mahindra Ltd. (M&M Ltd.) has announced that its overall auto sales for the month of January 2024 stood at 73,944 vehicles, a growth of 15%, including exports. 

Mahindra & Mahindra Ltd.’s Farm Equipment Sector (FES), part of the Mahindra Group, announced its domestic sales in January 2024 were at 22972 units, as against 27626 units during January 2023. Total tractor sales (Domestic + Exports) during January 2024 were at 23948 units, as against 28926 units for the same period last year. Exports for the month stood at 976 units.

M&M stock rose by 2.62% on the NSE, trading at ₹1,694.90.

Dixon Technologies stock rose by 1.80% on the NSE, trading at ₹6,099, following the announcement of financial results for the period ended December 2023.

L&T Technology Services supports Marelli in revolutionising automotive infotainment with Digital Twin Technology

L&T Technology Services stock trades at ₹5,571.05 on the NSE, down by 0.23%.

MRF Ltd has appointed P John Mathew, Associate Vice President- Engineering, as Vice President Engineering w.e.f 1 st February, following the retirement of Manoranjan Das. 

MRF stock rose by 1.06%, trades at ₹1,44,088.70

Focus today –– FM to announce Budget at 11. – Focus on sectors like - Solar, power, EV, Green Hydrogen, rail infra, PSU Bank FPI cap limit may hike above 20%. ADR/GDR – Reliance, Axis Bank and SBI gain between 1-2. Dr Reddy gained 3.5%. Mankind Pharma, Jindal Steel, Ajanta Pharma, Motherson Sumi, Shree Cement, Dixon Tech, Bank of Baroda good Q3 results and improved asset quality, Ambuja Cement reported lower than expected Q3 results, Maruti and Kajaria Ceramic reported inline with expected Q3 results. Titan, Lal Path Lab, Indian Hotel, Adani Ports, Mphasis, Sonata Software, Bata India, Castrol India, RITES, HFCL, Raymond. Amazon, Apple and Meta results today.

Budget - Union minister Nirmala Sitharaman will present the country’s interim budget today at 11am. Traders focus on Rail, fertilizer, Solar, PSU Banks, Infra, Green Energy, affordable healthcare, cashless insurance, EV and defence stocks. Positive factor is that strong tax collection may reduce fiscal burden. Income Tax collection surged to above Corporate tax collection this year. Direct collection spiked from Rs4.5 lakh cr in 2020 to Rs10.5 lakh cr in 2024 while Corporate tax collection from 5.6lakh cr in 2020 to Rs9.5 lakh cr in 2024. Moreover, rising GST Collection will be positive for the market. Average GST collection nearly Rs1.7 lakh cr in the last seven months in 2024 compared to Rs1.5 lakh cr in 2023. Government capex surged five times in the last few years specially in defence, rail infra and road infra sectors. Government may focus Solar, power, EV, Green Hydrogen, rail infra, 

Global Market round up – US market fell over 2% and Asian markets opened on a weak note after the US Federal Reserve left interest rates unchanged and pushed back on any rate cuts soon (Expectation March – now delayed to May-June) . Nasdaq Composite slipped over 2% after Microsoft, Alphabet and AMD are all lower in the premarket, having failed to meet investor expectations. The Federal Reserve maintained interest rates between 5.25% and 5.5%. However, US 10-Year bond Yield decline 10-bps to 1-month low at 3.96% - expectation that the US Fed to cut interest rate despite delay in few months

Oil Price Update –. Brent Crude declined 3% to $80/bbl on account of rising US oil inventory and weak demand from China.

Gold Price Update – Gold price surged 1% to $2041/ounce due to US 10-Year bond yield falling to 1-month low to below 4% and in the wake of comments from Federal Reserve Chairman Jerome Powell that damped hopes of a rate cut in March.

Events Today – Mid-term Union Budget AT 11AM Manufacturing PMI. Indiabull Housing Right issue from today. Indus Tower Block deal worth Rs3800cr. Dabur India TGT by Goldman at 640.

Results Today - Titan Company, Adani Ports, Tube Investments , Abbott India, Mphasis, Aditya Birla Capital, Five-Star Business Finance, Sonata Software, Bata India, Aptus Value Housing Finance, Castrol India, RITES, HFCL, V-Guard Industries, AAVAS Financiers, Raymond, Aether Industries, City Union Bank, Godrej Agrovet, Minda Corporation, Texmaco Rail, India Cements, GMM Pfaudler. Lal Path Lab, Indian Hotel

Angel One Ltd has announced the appointment of Meenal Maheshwari Shah as Group General Counsel, effective today, Feb 1.

Angel One shares trade at ₹3,323.55 on the NSE, up by 1.16%.

On the global front, the Federal Reserve left interest rates unchanged Wednesday, though signaled no rush to cut rates as more confidence was needed that “elevated” inflation continues to slow toward the target at a time of “solid” economic growth and strong job gains. Officials on the rate-setting Federal Open Market Committee (FOMC) removed a piece of language from their meeting statement about the possibility of higher rates, which is a significant step as the Fed shifts its posture on future rate actions. The three major US stock indices were already weighed down by weakness in tech and tech-adjacent mega-cap stocks the day after disappointing Alphabet results. All three extended losses after the Fed’s announcement and Chair Jerome Powell’s subsequent press conference. On the domestic front, the Central government’s fiscal deficit widened to Rs 9.82 lakh crore in April-December from Rs 9.07 lakh crore in April-November. Meanwhile, India’s eight core sectors posted a growth of 3.8% in December which is the lowest in 14 months. Going forward to Indian stocks, RBI on January 31 barred Paytm Payments Bank from onboarding new customers with immediate effect. Meanwhile, on the economy front, the government’s GST collections rose to Rs 1.72 lakh crore in January 2024. At Rs 1.72 lakh crores, the January GST collection is the second-highest ever and is 4.4% higher than the Rs 1.65 lakh crore collected in December 2023. In continuation of the one-day-up and one-day-down pattern seen for the sixth consecutive session, Sensex on Wednesday ended over 600 points at 71,752 while Nifty also scaled above the 21,700 levels with everyone busy forecasting the outcome of tonight’s US Fed meeting and tomorrow’s Interim Budget. Going ahead, trends in the GIFT Nifty indicate a firm start for the broader index in India.

The 50 index witnessed a jittery opening ahead of the budget day; however, it trended with a positive bias after marking an intraday low of 21448 within the opening minutes. The day’s closing came on a stronger foot with a relatively higher volume. The 21500PE strikes added the highest open interest on the derivative front, indicating immediate support. On the higher side, 21800 will continue to act as immediate and stiff resistance and a closing above this zone will attract further bullish momentum.

Support: 21700-21650-21570

Resistance: 21750-21800-21900

The GST collection numbers continue to show a significant growth on a year-on-year basis, with GST collection in January, 2024, which is second highest ever at INR 1.72 lac crores, showing a y-o-y growth of 10.4% and a month on month growth of ~ 4.4%. This increase in GST collection seems to be on the basis of growth in economic activity, with the month of December 2023 (for which the taxes are collected in January 2024) clocking second highest ever e-way bills generation at 9.52 crores. -- Gunjan Prabhakaran, Partner & Leader, Indirect Tax, BDO India

(Nirmal Bang Retail Research) 

Sales Volume came at 8.20 vs expectation of 7.95, QoQ 7.58, YoY 7.70 

Result below Expectation 

Revenue from Operations came at Rs. 4439.5 Cr (11.8% QoQ, 7.5% YoY) vs expectation of Rs. 4332.2 Cr, QoQ Rs. 3969.8 Cr, YoY Rs. 4128.5 Cr 

EBIDTA came at Rs. 851.1 Cr (10% QoQ, 35.9% YoY) vs expectation of Rs. 983.4 Cr, QoQ Rs. 773.4 Cr, YoY Rs. 626.1 Cr 

EBITDA Margin came at 19.2% vs expectation of 22.7%, QoQ 19.5%, YoY 15.2% 

EBITDA/T came at Rs.1038 vs Exp 1235 QoQ Rs.1020 YoY Rs.813 

Adj. PAT came at Rs. 513.7 Cr vs expectation of Rs. 679.6 Cr, QoQ Rs. 643.8 Cr, YoY Rs. 430.3 Cr 

Quarter EPS is Rs. 2.6 

Stock is trading at 14.3x EV/EBITDA FY25 

(Nirmal Bang Retail Research) 

Result is in-line with expectations 

Revenue from Operations came at Rs. 677.5 Cr (-7.5% QoQ, 10.6% YoY) vs expectation of Rs. 672.1 Cr, QoQ Rs. 732.3 Cr, YoY Rs. 612.7 Cr 

EBIDTA came at Rs. 118.6 Cr (-12.4% QoQ, 40.6% YoY) vs expectation of Rs. 116.6 Cr, QoQ Rs. 135.4 Cr, YoY Rs. 84.4 Cr 

EBITDA Margin came at 17.5% vs expectation of 17.3%, QoQ 18.5%, YoY 13.8% 

Adj. PAT came at Rs. 90.9 Cr vs expectation of Rs. 90.7 Cr, QoQ Rs. 104.2 Cr, YoY Rs. 67.4 Cr 

Quarter EPS is Rs. 2.5 

Stock is trading at P/E of 49.9x FY25E EPS 

(Nirmal Bang Retail Research) 

Result is in-line with expectations 

Revenue from Operations came at Rs. 33308.7 Cr (-10.1% QoQ, 14.7% YoY) vs expectation of Rs. 33489.7 Cr, QoQ Rs. 37062.1 Cr, YoY Rs. 29044.3 Cr 

EBIDTA came at Rs. 3907.9 Cr (-18.3% QoQ, 37.9% YoY) vs expectation of Rs. 3901.9 Cr, QoQ Rs. 4784.2 Cr, YoY Rs. 2833.1 Cr 

EBITDA Margin came at 11.7% vs expectation of 11.7%, QoQ 12.9%, YoY 9.8% 

Adj. PAT came at Rs. 3130 Cr vs expectation of Rs. 2977.5 Cr, QoQ Rs. 3716.5 Cr, YoY Rs. 2351.3 Cr 

Quarter EPS is Rs. 99.6 

Stock is trading at P/E of 26.8x TTM EPS 

(Nirmal Bang Retail Research) 

Result is above expectations 

Revenue from Operations came at Rs. 12828.4 Cr (4.6% QoQ, -16.9% YoY) vs expectation of Rs. 13993.9 Cr, QoQ Rs. 12267.2 Cr, YoY Rs. 15438.1 Cr 

EBIDTA came at Rs. 504.2 Cr (250.9% QoQ, -16.7% YoY) vs expectation of Rs. 343.2 Cr, QoQ Rs. 143.7 Cr, YoY Rs. 605.2 Cr 

EBITDA Margin came at 3.9% vs expectation of 2.5%, QoQ 1.2%, YoY 3.9% 

Adj. PAT came at Rs. 200.9 Cr vs expectation of Rs. 52.8 Cr, QoQ Rs. -77.2 Cr, YoY Rs. 246.2 Cr 

Quarter EPS is Rs. 1.5 

Stock is trading at P/E of 49x FY25E EPS 

(Nirmal Bang Retail Research)

Result is above expectations 

Revenue from Operations came at Rs. 1151.4 Cr (0.4% QoQ, -3% YoY) vs expectation of Rs. 1235.5 Cr, QoQ Rs. 1146.3 Cr, YoY Rs. 1187.1 Cr 

EBIDTA came at Rs. 192.5 Cr (14.9% QoQ, 12.5% YoY) vs expectation of Rs. 175.1 Cr, QoQ Rs. 167.5 Cr, YoY Rs. 171 Cr 

EBITDA Margin came at 16.7% vs expectation of 14.2%, QoQ 14.6%, YoY 14.4% 

Adj. PAT came at Rs. 111.3 Cr vs expectation of Rs. 114 Cr, QoQ Rs. 101.9 Cr, YoY Rs. 109.1 Cr 

Quarter EPS is Rs. 5.9 

Stock is trading at P/E of 35.9x FY25E EPS 

(Nirmal Bang Retail Research)

Result is ahead of expectations 

Revenue from Operations came at Rs. 12380.7 Cr (1.5% QoQ, 10.1% YoY) vs expectation of Rs. 12336.2 Cr, QoQ Rs. 12192.4 Cr, YoY Rs. 11241 Cr 

EBIDTA came at Rs. 3476.8 Cr (8.2% QoQ, 15.6% YoY) vs expectation of Rs. 3301.2 Cr, QoQ Rs. 3213.5 Cr, YoY Rs. 3006.9 Cr 

EBITDA Margin came at 28.1% vs expectation of 26.8%, QoQ 26.4%, YoY 26.7% 

Adj. PAT came at Rs. 2453.9 Cr vs expectation of Rs. 2470.4 Cr, QoQ Rs. 2375.5 Cr, YoY Rs. 2166 Cr 

Quarter EPS is Rs. 10.2 

Stock is trading at P/E of 31.3x FY25E EPS 

Minister of Commerce and Industry, Piyush Goyal, in a virtual call to the chiefs of all the automobile manufacturers last Sunday, urged them to make the Bharat Mobility Global Expo 2024 “an even bigger event next year”.

Sources told businessline that Goyal, who initiated the event three-four months ago, met the CEOs in October to share the idea and to urge them to participate in the event on a big scale.

Some luxury car makers who had stopped participating in the biennial Auto Expo, would participate in the event.

NTPC Limited had signed a non-binding MoU with Numaligarh Refinery Limited (NRL), for partnership opportunities in the proposed bamboo-based Bio-Refinery at NTPC Bongaigaon and other green projects.

NTPC stock rose by 1.02% on the NSE, trading at ₹320.75

Major gainers on the NSE at 9:30 am:

Eicher Motors (2.21%); BPCL (2.07%); Maruti (1.67%); Cipla (1.53%); Power Grid (1.52%)

Major losers:

LTI Mindtree (-1.19%); Grasim (-1.13%); Wipro (-1.07%); L&T (-0.95%); Tech Mahindra (-0.69%)

The initial public offering of BLS E-Services will close for public subscription today. The issue has received a strong response from retail investors and high net worth individuals. The IPO that plans to raise ₹311 crore, has a price band of ₹129-135 and a market lot of 108 shares. The entire IPO is a fresh issue, which means funds raised will go to the company.

- Maruti Suzuki (MSIL)‘s 3QFY24 performance was in line. MSIL’s EBITDA margin expanded ~200bp YoY to 11.7%, despite higher discounts during the quarter. While the PV growth outlook appears to moderate in FY25E, the market share gains through SUV launches and growth in CNG penetration should augur well for the company.

- Moreover, the recovery in EBITDA margin to ~12% in FY25E would be driven by: a) normalization in the product lifecycle, b) price increases and mix improvement, c) commodity cost/FX benefits, d) lower royalty, and e) operating leverage. We cut our FY24E/25E EPS by ~3% each to factor in the sustained weakness in the lower-end PV segment.

- The stock trades at 23.8x/22.8x FY24E/FY25E consolidated EPS. Reiterate BUY with a TP of INR11,850 (premised on 25x Dec’25E consolidated EPS).

Tarun Chugh, MD and CEO, Bajaj Allianz Life Insurance

“The industry is hopeful that the interim budget will introduce much-needed reforms to incentivize the purchase of insurance and enhance the industry’s efforts to increase insurance penetration within the country.

With a significant number of people heading towards retirement age in the next decade, incentivizing the purchase of products in the pension category becomes crucial in this interim budget. It is recommended that life insurance annuity or pension products be aligned with the National Pension Scheme (NPS). We also advocate for an additional deduction of Rs. 50,000 or more. Additionally, similar initiatives will be required across our product categories, including pension products, ULIPs, and even traditional plans. I believe customers will benefit from them and will have more reasons to invest in the industry for their long-term financial goals, thereby fuelling India’s development.”

The benchmark indices have given positive returns in three out of the four interim Budget days. The Sensex rose 0.6 per cent on February 1, 2019. The index saw gains of 0.5 per cent and 2.4 per cent in 2014 and 2004, respectively. In 2009, the gauge saw a drop of 3.4 per cent. 

The Sensex, however, has fallen on 4 out the last five occasions one month after the Budget, with the steepest drop of 7.7 per cent on July 5, 2019

Mphasis has received the 2023 ISG Star of ExcellenceTM Award in the “Emerging Tech” segment for “Artificial Intelligence (AI).

One 97 Communications has been informed by its associate entity, Paytm Payments Bank Limited (PPBL), that the RBI has given it further directions under section 35A of the Banking Regulation Act, 1949.

The company’s stock plunges 20% on NSE to trade at ₹608.80. 

Bajaj Auto recorded total sales of two wheelers and commercial vehicles at 3,56,010 units in Jan 24, as against 2,87,935 units in Jan 2022.

Nifty witnessed a great bounce back after the weak opening session and extended the gains further as the day progressed to find resistance once again near the 21750 zone but ended the session on a positive note. Volatility is much expected with the index desperately requiring a decisive breach above the tough resistance barrier of 21750 zone to trigger for a breakout and anticipate for further rise in the coming days. The support for the day is seen at 21600 while the resistance would be at 21900. 

BankNifty witnessed a decent spurt from 45000 zone to touch 46000 level in the morning session with bias improving and anticipating for further rise in the coming session with sentiment getting better. The index after a decisive breach above the important hurdle of 46300 zone of the significant 50EMA level is confirmed, then some conviction can be established to anticipate for further upward move in the coming sessions. Bank Nifty would have a daily range of 45600–46600 levels.

Indian benchmark indices, namely Sensex and Nifty, opened with a flat but positive bias on Thursday, drawing attention to the Interim Budget. In early trade, the 30-share BSE Sensex saw a 76.55-point climb to reach 71,828.66, while the NSE Nifty gained 19.80 points, reaching 21,745.50. 

Despite Finance Minister Nirmala Sitharaman emphasizing it will be a vote on accounts, expectations of potential personal tax adjustments and industry concessions have surfaced.

Global markets experienced a decline as the US Federal Reserve maintained status quo on interest rates, contrary to widespread expectations of a rate cut. The Gift Nifty at 21,821 suggests a flat opening, with ongoing scrutiny of the FED Policy outcome and the Interim Budget.

Analysts emphasise the significance of the index surpassing 21,800 for an uptrend continuation and caution against the critical moving average support at 21,300. Continuous selling by foreign portfolio investors is anticipated to impact short-term stock movement, driven by the firm stance of the US Fed.

The India VIX at 16.04 signals impending uncertainty and potential market corrections.

DSP Mutual Fund emphasizes India’s long-term investment potential but advises vigilance amid a changing global landscape characterized by slowing growth, rising global interest rates, persistent dollar strength, and geopolitical uncertainties.

Technical analysis by Mandar Bhojane of Choice Broking highlights a bullish trend with Nifty support at 21,450 and resistance at 21,900, while Bank Nifty’s support lies above 45,000, and resistance at 47,000. Volatility is heightened due to Budget day and the US FED Meeting, prompting analysts to recommend maintaining positions with prudent risk management.

Morning Outlook for 1st FEB 2024

The Sensex and Nifty indices are expected to open on a flat-to-positive note on February 1, based on indications from the GIFT Nifty, suggesting a modest gain of 20 points for the broader index. Equity benchmarks Sensex and Nifty rallied by a percent each on January 31, supported by across-the-board buying on the budget eve and ahead of the US Federal Reserve meeting outcome.

On the daily chart, Nifty formed a Piercing Candlestick pattern indicating bullishness. Nifty may find support at 21,450, followed by 21,200 and 21,000. On the higher side, 21,900 can be an immediate resistance, followed by 22,000 and 22,150.

Banknifty, on the daily chart, is sustaining above the 45,000 levels, which will act as an immediate support level. On the flip side, 47,000 acts as an immediate hurdle. Currently, Banknifty is trading in a range of 44,500 to 46,550, with volatile action expected. If Banknifty breaks the 47,000 level, it may move further up to the 48,000 level.

IndiaVIX was negative by 0.37 percent intraday and settled at 16.04.

Foreign institutional investors (FIIs) net bought shares worth Rs 1,660.72 crore, while domestic institutional investors (DIIs) purchased Rs 2,542.93 crore worth of stocks on January 31, provisional data from the NSE showed.

Due to Budget day and the US FED Meeting, volatility increased in the market. Investors and traders are advised to maintain their positions with prudent risk management.

Mandar Bhojane

Research Analyst

Choice Broking

Citi on Motherson Wiring: Maintain Buy on Company, raise target price at Rs 78/sh (Positive)

HSBC on Dixon: Maintain Buy on Company, raise target price at Rs 6550/sh (Positive)

CLSA on Sun Pharma: Maintain Buy on Company, raise target price at Rs 1610/sh (Positive)

Nuvama on Sun Pharma: Maintain Buy on Company, raise target price at Rs 1635/sh (Positive)

Citi on Sun Pharma: Maintain Buy on Company, raise target price at Rs 1640/sh (Positive)

Nuvama on Shree Cement: Maintain Hold on Company, raise target price at Rs 29495/sh (Positive)

Nuvama on Kaynes Tech: Maintain Buy on Company, raise target price at Rs 3725/sh (Positive)

Nuvama on Ambuja Cement: Maintain Buy on Company, raise target price at Rs 609/sh (Positive)

Nomura on Bank Baroda: Upgrade to Buy on Bank, raise target price at Rs 290/sh (Positive)

MS on Ambuja Cement: Maintain Overweight on Company, target price at Rs 600/sh (Positive)

Citi on Kalyan Jewel: Maintain Buy on Company, raise target price at Rs 480/sh (Positive)

HSBC on Maruti: Maintain Buy on Company, target price at Rs 12500/sh (Positive)

Nomura on Maruti: Maintain Neutral on Company, target price at Rs 11649/sh (Neutral)

MS on Maruti: Maintain Overweight on Company, target price at Rs 11228/sh (Neutral)

MS on JSPL: Maintain Underweight on Company, target price at Rs 525/sh (Neutral)

MS on Bank Baroda: Maintain Equal weight on Bank, target price at Rs 245/sh (Neutral)

MS on Shree Cem: Maintain Equal weight on Company, target price at Rs 28500/sh (Neutral)

HSBC on Jubilant Food: Maintain Buy on Company, cut target price at Rs 580/sh (Neutral)

Citi on Jubilant Food: Maintain Buy on Company, cut target price at Rs 600/sh (Neutral)

MS on Jubilant Food: Maintain Equal weight on Company, target price at Rs 456/sh (Neutral)

BofA on Sun Pharma: Maintain Neutral on Company, raise target price at Rs 1440/sh (Neutral)

Jefferies on SRF: Maintain Underperform on Company, target price at Rs 2065/sh (Neutral)

MS on Dixon Tech: Maintain Underweight on Company, target price at Rs /sh (Neutral)

Elara on PVR: Maintain Buy on Company, target price at Rs 1900/sh (Neutral)

Jefferies on PayTM: Downgrade to Underperform on Company, cut target price at Rs 500/Sh (Negative)

Macquarie on PayTM: Maintain Neutral on Company, cut target price at Rs 650/Sh (Negative)

Thomas Cook: Net Profit at Rs 82.4 cr vs Rs 18.5 cr, Revenue at Rs 1893 cr vs Rs 1536 cr (YoY) (Positive) 

Ratnaveer: Net Profit at Rs 9.3 cr vs Rs 3.5 cr, Revenue at Rs 190 cr vs Rs 107 cr (YoY) (Positive) 

Udaipur Cement: Net Profit at Rs 25.3 cr vs Rs 3.2 cr, Revenue at Rs 299 cr vs Rs 238 cr (QoQ) (Positive) 

JSPL: Net profit at ₹1,928 cr vs poll of ₹945 cr, Revenue at Rs 11701 cr vs Rs 12178 cr (YoY) (Positive) 

Godrej CP: Net profit at ₹581.0 cr vs poll of ₹565 cr, Revenue at Rs 3660 cr vs Rs 3599 cr (YoY) (Positive) 

Shree Cem: Net Profit at Rs 734.0 cr vs Rs 277.0 cr, Revenue at Rs 4900.0 cr vs Rs 4069.0 cr (YoY) (Positive) 

IRB Infra: Net Profit at Rs 187 cr vs Rs 141 cr, Revenue at Rs 1968 cr vs Rs 1514 cr (YoY) (Positive) 

Swan Energy: Net Profit at Rs 220 cr vs Rs 165 cr, Revenue at Rs 1591 cr vs Rs 1222 cr (QoQ) (Positive) 

Uttam Sugar: Net Profit at Rs 47.5 cr vs Rs 26.1 cr, Revenue at Rs 517 cr vs Rs 472 cr (YoY) (Positive) 

Ajanta Pharma: Net Profit at Rs 210 cr vs Rs 135 cr, Revenue at Rs 1105 cr vs Rs 972 cr (YoY) (Positive) 

Relaxo: Net Profit at Rs 38.6 cr vs Rs 30.1 cr, Revenue at Rs 713 cr vs Rs 681 cr (YoY) (Positive) 

Heldelberg: Net Profit at Rs 31.4 cr vs Rs 5.6 cr, Revenue at Rs 607 cr vs Rs 540 cr (YoY) (Positive) 

Data Patterns: Net Profit at Rs 51 cr vs Rs 33 cr, Revenue at Rs 139 cr vs Rs 111 cr (YoY) (Positive) 

Mankind Pharma: Net Profit at Rs 607 cr vs Rs 437.0 cr, Revenue at Rs 2607 cr vs Rs 2091 cr (YoY) (Positive) 

Paras Defence: Company gets optical periscopes contract from Defence Ministry; to complete delivery by FY25 (Positive) 

Kaynes tech: Nanotech company DigiLens announces partnership with company for scaling waveguide manufacturing. (Positive) 

Cochin Shipyard: Company has secured an international order worth of Rs 500 crore for a hybrid Service Operation Vessel (SOV) from a European client. (Positive) 

Havells India: Company introduced the first made in India energy-efficient Heat Pump Water Heater, providing up to 75% energy savings. (Positive) 

Ambuja Cem: Company is aiming to double its capacity and achieve an EBITDA per ton of Rs. 1450+. (Positive) 

Infosys: Company partneed with Musgrave, Ireland’s top food retail company, to lead cognitive first IT transformation. (Positive) 

Vikas Lifecare: Company expands with the incorporation of Vikas Lifecare LLC in Dubai, UAE. (Positive) 

Borosil: Company has commissioned a new borosilicate glass furnace in Jaipur, Rajasthan, with a production capacity of 25 tonnes per day. (Positive) 

Olectra Greentech: Company has a Net order book of electric buses stands at 8,088 striving to meet the target of delivering 650 electric buses for the year. (Positive) 

Gujarat Gas: Company signs MoU with HPCL for liquid fuels & CNG facilities (Positive) 

Aviation Companies: Jet Fuel (ATF) price cut to ₹1.00 lk/kL from ₹1.01 lk/kL in Delhi (Positive) 

Glenmark Pharmaceuticals: Company and Pfizer join forces to introduce Abrocitinib in India (Positive) 

Deepak Nitrite: Company has signed a Memorandum of Understanding with the Government of Gujarat to invest around 9,000 Crores in establishing projects at Dahej, Gujarat (Positive) 

DCAL: Company has been awarded the “Attestation of Inspection” by the European Directorate for the Quality of Medicines & HealthCare (Positive) 

Balaji Amines: Net Profit at Rs 55.6 cr vs Rs 83.7 cr, Revenue at Rs 383 cr vs Rs 586 cr (YoY). (Neutral) 

Kamat Hotels: Net Profit at Rs 43 cr vs Rs 35 cr, Revenue at Rs 86 cr vs Rs 84 cr (YoY). (Neutral) 

DCM Shriram: Net Profit at Rs 240.0 cr vs Rs 342.0 cr, Revenue at Rs 3125 cr vs Rs 3354 cr (YoY). (Neutral) 

Amara Raja: Net Profit at Rs 255 cr vs Rs 222 cr, Revenue at Rs 3044 cr vs Rs 2638 cr (YoY) (Neutral) 

Nilkamal: Net Profit at Rs 29.4 cr vs Rs 33.2 cr, Revenue at Rs 803 cr vs Rs 754 cr (YoY) (Neutral) 

Lux Ind: Net Profit at Rs 20.2 cr vs Rs 18.1 cr, Revenue at Rs 447 cr vs Rs 459 cr

GMR Airports: Net loss at Rs 317 cr vs profit of Rs 191 cr, Revenue at Rs 2227 cr vs Rs 1761 cr (YoY) (Neutral) 

Nestle: Varun Sethuraman to succeed Gopichandar Jagatheesa as BEO of Cereals Business (Neutral) 

PCBL: Company has acquired 212,172 shares of M/s. Aquapharm Chemicals Private Limited, making ACPL a subsidiary of PCBL (Neutral) 

Federal-Mogul Goetze: Company appoints T Kannan as MD for 3 years effective February 1 (Neutral) 

United Spirits: Company has announced the closure of its factory operations at the Udaipur, Rajasthan manufacturing unit. (Neutral) 

Triveni: Company has announced the acquisition of up to 26% of Sir Shadi Lal Enterprises Ltd.’s voting share capital at a price of INR 262.15 per share. (Neutral) 

Ultratech: Moody’s affirms UltraTech Cement’s Baa3 ratings; outlook stable. (Neutral) 

Indus Towers: KKR, CPP Likely to Sell Shares in Indus Towers via Block Deal, sources to CNBC. (Neutral) 

Bajaj Finance: Rakesh Bhatt resigns as executive director of the company w.e.f. January 31, 2024 (Neutral) 

PayTM: Payments Bank barred from accepting deposits post-Feb 29 due to non-compliances. (Negative) 

Westlife: Net Profit at Rs 17.2 cr versus profit Rs 36.4 crore; revenue declines 2% to Rs 600.0 crore (Negative

Pre Market

Merck & Company, Inc. (Pre market) (Sector- Healthcare)

Shell PLC (Pre market) (Sector- Energy)

Honeywell International Inc. (Pre market) (Sector- Auto Ancillary)

Sanofi (Pre market) (Sector- Healthcare)

Eaton Corporation, PLC (Pre market) (Sector- Power)

Ferrari N.V. (Pre market) (Sector- Automobile)

Illinois Tool Works Inc. (Pre market) (Sector- Capital Goods)

Altria Group (Pre market) (Sector- FMCG)

Trane Technologies plc (Pre market) (Sector- Technology)

Takeda Pharmaceutical Company Limited (Pre market) (Sector- Healthcare)

Royal Caribbean Cruises Ltd. (Pre market) (Sector- Hotel)

Cardinal Health, Inc. (Pre market) (Sector- Healthcare)

WEC Energy Group, Inc. (Pre market) (Sector- Energy)

Rogers Communication, Inc. (Pre market) (Sector- Telecom)

Broadridge Financial Solutions, Inc. (Pre market) (Sector- Financial)

Dover Corporation (Pre market) (Sector- Capital Goods)

Ball Corporation (Pre market) (Sector- FMCG)

Brookfield Infrastructure Partners LP (Pre market) (Sector- Infrastructure) 

Post Market

Apple Inc. (Post market) (Sector- Technology)

Amazon, Inc. (Post market) (Sector- Technology)

Meta Platforms, Inc. (Post market) (Sector- Technology)

Atlassian Corporation (Post market) (Sector- Technology)

Microchip Technology Incorporated (Post market) (Sector- technology)

Hartford Financial Services Group (Post market) (Sector- Financial)

Deckers Outdoor Corporation (Post market) (Sector- Textile)

LPL Financial Holdings Inc. (Post market) (Sector- Financial)

Clorox Company (Post market) (Sector- Consumer Durables)

Hologic, Inc. (Post market) (Sector- Healthcare)

Gen Digital Inc. (Post market) (Sector- Technology)

All Day INDIA January Auto Sales YoY

TENT All OPEC-JMMC Meetings

TENT EURO ECB President Lagarde Speaks

07.15 CHINA Caixin Manufacturing PMI (Expected: 50.8 versus Previous: 50.8)

10.30 INDIA HSBC Manufacturing PMI (Expected: 56.9 versus Previous: 54.9)

11.00 INDIA Interim Budget for FY 2024-25

15.30 EURO CPI Flsh Estimate y/y (Expected: 2.7% versus Previous: 2.9%)

17.30 U.K. BOE Monetary Policy Report (Expected: 5.25% versus Previous: 5.25%)

19.00 U.S. Unemployment Claims (Expected: 213k versus Previous: 214k)

20.30 U.S. ISM Manufacturing PMI (Expected: 47.2 versus Previous: 47.4)

• According to media reports, Indus Tower is set to witness a 7% equity sale by long-term holders, KKR and CPP. “If no strategic investor steps in the block”, there’s a high probability of an increase in free float.

• MSCI Perspective - The stock faced exclusion from MSCI in the May ‘23 review. Preliminary calculations by Nuvama Alternative Research suggest a potential re-entry around 210/215 levels in the May ‘24 review. Note that the cutoff levels are dynamic and change daily; the official cutoff will be in the latter half of April. The anticipated inflow could surpass USD 140mn. We will keep you posted on all the developments.

• FTSE Perspective – Its already a member (appx wt. of 16bps) and following the deal, the index provider should promptly increase the free float, leading to an incremental inflow of approximately USD 14mn, equivalent to a 0.3day impact. Stay tuned for further updates.

Abhilash Pagaria, Nuvama Alternative & Quantitative Research

Sprayking Limited, brass manufacturer, is pleased to announce that Company has received Export Purchase order worth INR 4 million for supply of Plumbing Fittings on Pilot Project Basis.

Indian markets could open flat to mildly higher, despite mostly lower Asian markets today and negative US markets on Jan 31

US stocks saw their biggest decline on a Federal Reserve day since last March after Jerome Powell said officials want to keep their options open instead of rushing to cut interest rates. Microsoft Corp. and Alphabet Inc. slumped after disappointing investors betting that an artificial intelligence bonanza would quickly fuel results. The Federal Reserve held interest rates steady for a fourth straight meeting and signaled an openness to cutting them, though Fed Chair Jerome Powell threw cold water on investors’ hopes that reductions would begin in March. Speaking after the Fed decision, Chair Jerome Powell said he doesn’t think it’s likely the central bank will ease policy in March. In a sign that officials are not in a hurry to lower rates, the central bank also said it “does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%.”

A separate report from the ADP Research Institute showed companies added a smaller-than-expected 107,000 jobs in January, and worker pay growth slowed. China’s factory activity expanded in January thanks to stable growth in output, quicker logistics, and the first rise in new export orders since June, helping lift business confidence to a nine-month high, a private-sector survey showed on Thursday. The Caixin/S&P Global manufacturing PMI stayed at 50.8 in January, unchanged from December and surpassing analysts’ forecasts of 50.6. 

India’s Goods and Services Tax (GST) collections rose to Rs 1.72 lakh crore in January, - the second-highest ever and is 4.4 percent higher than the Rs 1.65 lakh crore collected in December 2023 and 9.3% higher YoY. It also takes the average monthly collection in 2023-24 to Rs 1.67 lakh crore.

India’s eight core sectors posted a growth of 3.8 percent in December - the lowest in 14 months. In November 2023, core sector growth had printed in at 7.8 percent. The commerce ministry, on January 31, revised this figure slightly up to 7.9 percent. The output of the eight core sectors had grown by 8.3 percent in December 2022. The Central government’s fiscal deficit widened to Rs 9.82 lakh crore in April-December from Rs 9.07 lakh crore in April-November, - 55.0 percent of the full-year target of Rs 17.87 lakh crore vs 59.8% in April-December 2022.

Asian stocks mostly fell after the S&P 500 slumped amid disappointing earnings reports and the Federal Reserve’s pushback on interest-rate-cut expectations. Nifty ended on a positive note in a volatile session on January 31 ahead of the budget and US Fed’s rate decision. At close, Nifty was up 0.95% or 203.6 points at 21725.6. Nifty continued its pattern of alternate up and down candles on Jan 31. With Vote on account lined up, the range of 21429-21813 is due to be broken soon. On the monthly chart, Nifty lost 0.03% and formed a doji after a two month rise, indicating indecision at higher levels. Today markets could be volatile as the street interprets the announcements of the FM and later analyses the effect on the economy and markets.

(PG IN, Mkt Cap USD6.7b, CMP INR17245, TP INR16000, 7% Downside, Neutral)

- P&G Hygiene and Healthcare (PGHH) recorded stagnant growth in 2QFY24 (ending in June), falling short of our high single-digit growth expectations. However, PAT increased 10% YoY propelled by a soft RM basket and a favorable product price mix. 

- GM expanded 300bp YoY to 60%. Despite flat revenue growth, ad spending rose 14% YoY (11.2% of sales vs. 9.7% YoY). GM limited the EBITDA margin expansion to 180bp YoY at 27% (best margin during the last 8-9 quarters). 

- With a portfolio of essentials and healthcare, the company remained focused on product innovation-led customer acquisition. Penetration play will continue, but at a steady pace, despite the high scope of user addition. The stock trades at rich valuations of 63x and 55x P/E of FY25E and FY26E. We do not see any medium-term trigger. Reiterate Neutral

(DABUR IN, Mkt Cap USD11.5b, CMP INR540, TP INR635, 18% Upside, Buy)

- Dabur’s 3QFY24 performance was largely in line. Consolidated revenue increased 7% YoY (in line) with the India business witnessing a growth of c.9% YoY and the International segment at 1% YoY (12% in cc). India volume growth stood at 6% YoY (organic growth at 4%). 

- HPC business was up 7% YoY with Oral care, Hair Oil, Home Care, and Shampoo clocking 8%, 5%, 7%, and 11%, respectively. The Healthcare division was weak at 3% growth, due to the delayed winter season. Both Chyawanprash and honey gained market share. F&B clocked 5% organic growth with the Badshah portfolio up by 33% YoY. 

- GM was up 300bp YoY and 30bp QoQ to 48.6%. High A&P spend (up 36% YoY) limited the EBITDA margin expansion to 30bp YoY to 20.5%. EBITDA was up 8% YoY. 

- Unlike other FMCG companies, Dabur has consistently been seeing higher rural growth compared to urban regions. With improving volume trajectory and no price-cut impact on revenue (unlike peers), we expect revenue the growth outperformance to sustain in the near term. The operating margin also has scope for improvement in the medium term, hovering in the c.20% band over the last eight to nine years (unlike peers that enjoyed expansion). We value Dabur on 48x Dec’25 EPS to arrive our TP of INR 635. We reiterate our BUY rating on the stock.

(SRCM IN, Mkt Cap USD12.4b, CMP INR28556, TP INR27700, 3% Downside, Neutral)

New capacities to boost volume growth 

- Shree Cement’s (SRCM) 3QFY24 EBITDA grew 74% YoY to INR12b (~9% above our estimate). Blended EBITDA/t stood at INR1,388 (est. INR1,290). OPM surged 7.8pp YoY to 25%. Adjusted PAT grew 165% YoY to INR7.3b (~32% above our estimate). 

- The management highlighted that it has revamped its brand strategy and has launched ‘Bangur’ as the master brand for all product categories across markets. It has also streamlined premium offerings, with only one premium product ‘Bangur Magna’. The company’s objective is to enhance consumer pull in the market and increase its premium product business. 

- We raise EBITDA estimates by 3% for FY25/FY26 each, considering higher volumes. The stock is currently trading at 19x/17x FY25E/FY26E EV/EBITDA. We value SRCM at 16x FY26E EV/EBITDA to arrive at a revised TP of INR27,700 (earlier INR27,000) and maintain Neutral rating on the stock.

(SUNP IN, Mkt Cap USD41b, CMP INR1418, TP INR1635, 15% Upside, Buy)

Sustained growth momentum in specialty global sales 

- Sun Pharma (SUNP) delivered in-line earnings for 3QFY24. SUNP delivered robust performance in domestic formulation (DF), specialty portfolio, US generics as well as the ROW market. This was partially offset by subdued show in emerging markets for the quarter. The R&D expenditure remained lower than earlier guidance, partly driving better profitability for the quarter. 

- We raise our earnings estimates for FY25/FY26 by 4%/5%, factoring a) superior execution in global specialty sales, b) revival in growth prospects in Taro, and c) industry-beating growth in the branded generics DF market. We also raise our PE multiple to 28x (from 26x earlier), factoring a) increased contribution from specialty and branded generics portfolio, b) expanding specialty portfolio by adding new molecules as well as utilizing existing molecule for alternate indications, and c) robust ANDA pipeline, comprising niche products. Accordingly, we arrive at a price target of INR1,635. 

- We remain positive on SUNP, given its position as a leading company establishing a robust specialty franchise in developed markets and driving better-than-industry growth in branded generics markets. We expect 19% earnings CAGR over FY24-26 on the back of 12% sales CAGR in DF/EM/ROW markets, 18% sales CAGR in global specialty sales, and 200bp margin expansion. We reiterate our BUY rating on the stock.

Larsen & Toubro Limited (L&T) reported a decent quarter despite challenges largely led by strong execution and better ordering activity providing healthy execution visibility ahead. Strong ordering particularly from international geographies led to the ordering backlog at ₹4.7 tn growing ~22% YoY translating into 3x TTM sales. EBITDA rose 14% YoY to ₹57.5 bn which remained lower than estimates while margins at 10.4% saw a 50 bps drop owning it as a result of legacy projects job mix exposure in the consol. ex-services portfolio. The company’s strategy stays aligned toward maintaining its bidding mechanism that reflects healthy working capital and better margin, which has positively reflected in lower working capital, as a percentage of sales to the current level of 16.6% from 19.0% in Q3FY23. L&T’s prospect pipeline for Q4FY24 stands at ₹6.3 tn, up 29% YoY. The pipeline has been boosted by strong order inflows in the hydrocarbon segment. The infrastructure sector forms 65% of the overall prospects, while the hydrocarbon segment makes up 27%. Stable oil prices auger well for prospects in the hydrocarbon segment and improve overall prospects in the Middle East. Given record OB with strong order pipeline, revival in private capex, healthy outlook ahead we remain positive on L&T earnings growth prospects. We have tweaked the estimates factoring strong execution and order inflow and marginally lowered margins given some delay in core margins recovery. We roll over our estimates to FY26 and maintain ‘BUY’ with a revised SOTP based TP of ₹3,865.

“Wall Street took a hit overnight with the Dow down 0.8%, the S&P 500 off 1.6%, and the Nasdaq tumbling 2.2% amid disappointing earnings from Alphabet. The Fed’s decision to keep interest rates steady further fueled selling across indexes. Investors now await Finance Minister Nirmala Sitharaman’s Interim Union Budget presentation, hoping for measures to boost economic growth and control deficits. On a positive note, January’s GST collections hit a record high of Rs 1.72 lakh crore. Trading strategies suggest buying opportunities for Nifty and Bank Nifty, with bullish sentiments on select stocks like INDIGO. Amidst earnings season, attention is on companies like Titan Company and Adani Enterprises. Volatility remains a key theme in the market.”