Nifty above 16,350 mark; breadth remains positive

The key equity indices traded with modest gains near the day`s high in the early afternoon trade. The Nifty traded above the 16,350 mark. Shares of autos, IT and private banks were in the green while metal, oil and gas and media stocks corrected.

At 12:22 IST, the barometer index, the S&P BSE Sensex, was up 484.08 points or 0.89% to 54,810.47 . The Nifty 50 index added 116.75 points or 0.72% to 16,382.90.

In the broader market, the S&P BSE Mid-Cap index rose 0.94% while the S&P BSE Small-Cap index gained 0.44%.

The market breadth, indicating the overall health of the market, was positive. On the BSE, 1,769 shares rose and 1,495 shares fell. A total of 186 shares were unchanged.

Persisting inflation worries, looming fears of sharp interest rates hikes and worsening the global economic outlook continued to weigh on investors` sentiment.

Derivatives:

The NSE`s India VIX, a gauge of the market`s expectation of volatility over the near term, fell 0.88% to 22.8950. The Nifty 26 May 2022 futures were trading at 16,344.45 at a discount of 38.45 points as compared with the spot at 16,382.90.

The Nifty option chain for the 26 May 2022 expiry showed maximum Call OI of 93 lakh contracts at the 17,000 strike price. Maximum Put OI of 90.7 lakh contracts was seen at 16,000 strike price.

Economy:

On Saturday, the Centre cut excise duty on petrol by Rs 8 per litre and on diesel by Rs 6 per litre to give relief to consumers battered by high fuel prices that have also pushed inflation to a multi-year high. The excise duty cut would translate into a reduction of Rs 9.5 a litre on petrol and Rs 7 a litre on diesel after taking into account its impact on other levies.

The government has waived customs duty on the import of some raw materials, including coking coal and ferronickel, used by the steel industry. The duty on exports of iron ore has been hiked up to 50% and on a few steel intermediaries to 15%, according to a notification. The duty changes will be effective from Sunday.

IPO Updates:

The initial public offer (IPO) of eMudhra received bids for 80,09,394 shares as against 1,13,64,784 shares on offer, according to stock exchange data at 12:09 IST on Monday (23 May 2022). The issue was subscribed 70%.

The issue opened for bidding on Friday (20 May 2022) and it will close on Tuesday (24 May 2022). The price band of the IPO is fixed at Rs 243-256 per share. An investor can bid for a minimum of 58 equity shares and in multiples thereof.

Buzzing Index:

The Nifty Private Bank index rose 1.45% to 17,662.70 .The index added 4.22% in two trading sessions.

Among the components of the Nifty Private Bank index, IndusInd Bank (up 2.1%), Kotak Mahindra Bank (up 2.07%), City Union Bank (up 1.88%), ICICI Bank (up 1.78%) and Bandhan Bank (up 1.1%) were the top gainers.

Among the other gainers were Axis Bank (up 1.09%), IDFC First Bank (up 0.97%), Federal Bank (up 0.53%), RBL Bank (up 0.47%) and HDFC Bank (up 0.37%).

Earnings Impact:

Power Grid Corporation Of India fell 1.18% after the PSU company`s consolidated net profit rose 17.9% to Rs 4,156.44 crore on a 1.7% rise in net sales to Rs 10,686 crore in Q4 FY22 over Q4 FY21. Profit before tax declined 4.4% to Rs 4,071.14 crore in Q4 FY22 as against Rs 4,258.51 crore recorded in the corresponding period last year. Total expenditure spiked 22.5% to Rs 1,982.74 crore inQ4 FY22 over Q4 FY21.

JK Cement shed 0.78%. On a consolidated basis, the cement maker`s net profit declined 6.8% to Rs 201.13 crore in Q4 FY22 as against Rs 215.91 crore in Q4 FY21. Consolidated net sales stood at Rs 2,351.16 crore in Q4 FY22, rising 10.2% year on year from Rs 2,134.15 crore in Q4 FY21. Profit before tax tumbled 22.7% to Rs 262.46 crore in Q4 FY22 from Rs 339.44 crore recorded Q4 FY21. The cement maker said it plans to raise funds upto Rs 500 crore by issue of secured/redeemable non-convertible debentures (NCD`s) in one or more series/tranches on private placement basis. The company`s board has recommended a proposal in this regard for approval of shareholders in the upcoming AGM. The fundraising will be at an interest rate that will be determined by the prevailing money market conditions at the time of borrowing, the company said in a stock exchange filing.

Thermax declined 2.19% after the company reported 4.5% decline in consolidated net profit to Rs 102.54 crore from Rs 107.35 crore in Q4 FY22 over Q4 FY21. The revenue from operations rose a 26.5% year on year to Rs 1,991.92 crore in the quarter ended 31 March 2022. Profit before tax fell 6.3% year on year to Rs 131.51 crore from Rs 140.38 crore in the quarter ended 31 March 2022.

Nuvoco Vistas Corporation slipped 1.25 after the company posted a 22.4% decline in consolidated net profit to Rs 29.11 crore in Q4 FY22 from Rs 37.52 crore posted in Q4 FY21. On a consolidated basis, revenue from operations rose 11.3% to Rs 2,930.18 crore in Q4 FY22 over Q4 FY21. Profit before tax slumped by 57.6% year on year to Rs 63.99 crore in Q4 FY22.

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