Morning Update :–Tata Motors, Sun Pharma, Britannia, Eicher Motors, and Cipla were among the Nifty’s biggest gainers, while UPL, SBI, ONGC, HDFC Bank, and ICICI Bank fell.
Sensex – Rise +87 Points at 72,172
Nifty 50 – Rise  +40 Points at 21,893
Indian Market
FII AND DII
| FII Bought | Â 70.69 Cr |
| DII Bought | 2,463.16 Cr |
Indian Market News
- Asian markets are mainly trading down, with the Straits Times and Kospi down 1% each and the Nikkei up 0.5%.
- Dollar reaches new peaks as Fed cut bets shrink.
- Oil prices remain stable amid Gaza peace talks, despite US plans Middle East strikes.
- Morgan Stanley Asia gets a stake of Rs 244 crore in Paytm for a customer.
- Tata Motors Q3 consolidated net profit doubles to Rs 7,025 crore.
- S&P 500 jumps to record closing high on strong earnings and data.
- According to a Reuters poll, the RBI is likely to keep rates until mid-year, with the first decrease expected in Q3 2024
- SBI Q3 net profit drops 35% to Rs 9,163 crore.
- IndiGo’s Q3 net profit climbs 111% as demand strength continues.
- Megatherm Induction will debut on the NSE Emerge on February 5th.
- India increases windfall tax on petroleum oil to 3,200 rupees per tonne.
- Morgan Stanley Asia gets a stake of Rs 244 crore in Paytm for a customer.
Global Markets updates
GIFT Nifty
Trends in the GIFT Nifty foreshadow a bad start for India’s broader market, which has lost 31 points or 0.14 percent. The Nifty futures were trading near the 21,935.00 mark.
US Markets
US stocks ended higher on Friday, with the S&P 500 reaching an all-time closing high. Strong earnings and a strong January employment report boosted confidence in the economy, reducing the likelihood of the Federal Reserve cutting interest rates. The rally capped a week filled with high-profile earnings, a Fed rate decision, and renewed jitters over regional banking weakness. Meta Platforms and Amazon.com’s quarterly results boosted the S&P 500 and Nasdaq Composite Index over 1%, while the Dow Jones Industrial Average’s gain was more muted. All three major US stock indexes also saw their fourth consecutive weekly gains.
Asian Markets
This week’s holiday-shortened start left Asian markets unsettled as investors awaited policy announcements from major central banks, such as the Reserve Bank of India on Thursday and the Reserve Bank of Australia on Tuesday.
Private surveys on activity in the service industry from Hong Kong and China will be made public on Monday. Singapore is scheduled to unveil its December retail sales data, and Thailand is scheduled to unveil its January inflation figures.
News Updates
India increases the tonne-wise windfall tax on crude to Rs 3,200.
The Indian government said late Friday that it will raise the windfall tax on petroleum oil to Rs 3,200 per tonne from 1,700 rupees on Saturday. The windfall tax on diesel and aviation turbine fuel will remain at zero.
The windfall tax on petroleum crude was lowered by the government on January 16 from Rs 2,300 per tonne.
India imposed a windfall tax on producers of crude oil in July 2022 and raised export taxes on petrol, gasoline and aviation fuel since private refiners favoured selling petroleum abroad rather than domestically in order to benefit from large refining margins. Every two weeks, the tax is adjusted.
First rate drop in Q3 2024, RBI expected to keep rates till mid-year, according to a Reuters poll.
According to analysts surveyed by Reuters, the Reserve Bank of India would maintain its benchmark interest rate at 6.50 percent on February 8. These economists anticipated that the central bank will hold onto rates for at least July, which is longer than some developed market central banks.
The RBI hasn’t raised its repo rate since February 2023 despite raising it by a total of 250 basis points, which is far less than most of its major competitors. This is because inflation has mostly stayed within the bank’s goal range of 2 to 6 percent.
RBI Chief Shaktikanta Das expressed optimism a few weeks ago that the present monetary policy could return inflation to its medium-term target of 4 percent.
However, a rate drop is unlikely anytime soon given that inflation is hovering around the upper end of the target range and India continues to be the main country developing at the quickest rate.
Q3 net profit for SBI falls 35% to Rs 9,163 crore, but asset quality remains strong.
On February 3, the State Bank of India (SBI) revealed its October–December quarter net profit for the fiscal year 2023–24. This represents a 35% decrease from the Rs 14,205 crore recorded in the same time the previous year. An average of five brokerage expectations of Rs 13,525 crore were missed by the net profit.
The lender stated that they had a Rs 7,100 crore one-time extraordinary item in a press release.h
The biggest bank in the nation’s net interest income (NII) was Rs 39,815 crore, less than the estimated Rs 40,304 crore. The lender’s net interest margin was 3.22 percent.
The gross non-performing asset (NPA) percentage of the bank decreased to 2.42 percent from 3.14 percent in the same quarter previous year. However, net non-performing assets (NPA) for the quarter were 0.64 percent as opposed to 0.77 percent in the previous year.
Q3 consolidated net profit at Tata Motors soars two times to Rs 7,025 crore.
On February 2, Tata Motors announced a two-fold increase in its consolidated net profit for the October-December quarter compared to Rs 2,957.71 crore the same period last year. The company attributed this to the strong demand for passenger and commercial vehicles in India, the continued growth of Jaguar Land Rover models, a reduction in the cost of raw materials, price increases, and an improved mix of products.
According to a filing with the exchange, revenue increased by 24.9 percent year over year to Rs 110,577 crore from Rs 88,489 crore during the same period previous year.
Analysts had predicted that the Mumbai-based automaker’s net profit would increase by 54% year over year (YOY) to Rs 4,547 crore in the October–December quarter. However, the actual figures beat their projections. According to the predictions, income is expected to increase by 22% year over year to Rs 1,08,169 crore.
Earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the Tata Group company increased by 42.5 percent year over year to Rs 15,333 crore, while operating margin increased by 171 basis points to 13.94 percent.
Net profit for IndiGo in Q3 leaps 111%
The parent company of IndiGo, the biggest low-cost airline in India, InterGlobe Aviation Ltd., announced on February 2 that its net profit for the December quarter increased by 111%. This increase was primarily driven by the ongoing demand for air travel as well as a fuel surcharge that was implemented in October.
The airline told exchanges that net profit was Rs 2,998.12 crore as opposed to Rs 1,422.6 crore the previous year.
Revenue reached Rs 19,452.15 crore, up 30%.
According to the announcement, IndiGo’s overall revenue increased to Rs 20,062.2 crore from Rs 15,410.2 crore during the same time last year.
Stocks in news
State Bank of India: Owing to an extraordinary loss of Rs 7,100 crore for the quarter, the public sector lender’s standalone profit for the quarter ended December FY24 was just Rs 9,164 crore, a steep 35.5% decrease from the same period last year. During the quarter, net interest income increased by 4.6% YoY to Rs 39,816 crore.
Tata Motors: Driven by robust operating results, the Tata Group company reported a 137.5 percent year-over-year increase in consolidated profit at Rs 7,025 crore for the quarter that ended in December of FY24. For the quarter, revenue from operations increased by 25% YoY to Rs 1,10,577 crore.
InterGlobe Aviation: Driven by strong topline and operating performance, the low-cost airline firm reported a staggering 110.7 percent year-over-year increase in profit at Rs 2,998.1 crore for the October–December period of FY24. The quarter’s revenue from operations was Rs 19,452 crore, a 30% increase over the same time in the previous fiscal year.
UPL: Due to a sharp decline in topline and subpar operating results, the crop solutions company reported a consolidated net loss of Rs 1,217 crore for the third quarter of FY24, compared to profit of Rs 1,087 crore in the same period last year. The overall revenue from operations experienced a 27.7% decline to Rs 9,887 crore when compared to the same time in the previous fiscal year.
Aurobindo Pharma: Unit-III, a formulation production facility of Eugia Pharma Specialities, a fully owned subsidiary of the business located in Telangana, was inspected by the US Food and Drug Administration (US FDA) from January 22 to February 2. With nine observations for the aforementioned unit, the US FDA concluded its examination.
Bank of India: The public sector lender saw a decline in bad loan provisions during the quarter that ended in December FY24, contributing to a 62.5 percent year-over-year gain in standalone profit of Rs 1,870 crore. The quarter’s net interest income decreased by 2.4 percent year over year to Rs 5,463 crore, while the net interest margin decreased by 43 basis points to 2.85 percent.
One 97 Communications: Morgan Stanley Asia (Singapore) Pte. Ltd. (ODI), a foreign institutional investor, has purchased 50 lakh equity shares at an average price of Rs 487.2 per share, representing 0.79 percent of paid-up equity. At Rs 243.6 crore, the Paytm shares were valued.
PB Fintech: Through open market transactions, venture capital fund PI Opportunities Fund II has sold 46,43,528 equity shares, representing 1.03 percent of the total paid-up equity. The shares were sold for an average of Rs 457.42 crore, or Rs 985.07 per share. As of December 2023, PI Opportunities Fund owned 1.93 percent of the business.
LIC home financing: For the quarter that concluded in December of FY24, the home financing company reported a staggering 142% year-over-year growth in net profit, or Rs 1,163 crore. In Q3 FY24, revenue from operations increased by 16 percent to Rs 6,792 crore, while net interest income increased by 31 percent year over year to Rs 2,097 crore. The outstanding loan portfolio increased by 5 percent to Rs 2,81,206 crore during the quarter.
Delhivery: Thanks in part to topline and other income, the logistics company reported a consolidated net profit of Rs 11.7 crore for the third quarter of FY24, compared to a loss of Rs 195.7 crore for the same period in the previous fiscal year. During the quarter, revenue from operations increased by 20.3% year over year to Rs 2,194.5 crore.
Mahindra Lifespace Developers: Despite a decline in revenue, the Mahindra Group company declared consolidated net profit of Rs 50.02 crore for the quarter that ended in December of FY24, up 46.7 percent from the same time last year. Operating revenue for the quarter was Rs 82 crore, a 56.1 percent decrease from the previous year.
Titagarh Rail Systems: Based on strong operating results, the company reported a consolidated net profit of Rs 74.8 crore for the October–December fiscal year of FY24, a sharp increase of 130% over the same time the previous year. In Q3 FY24, operating revenue rose 24.6 percent on an annual basis to Rs 954.7 crore.
Allcargo Gati: Due to an exceptional gain of Rs 33.52 crore against an exceptional loss of Rs 0.79 crore during the same period last year, the express distribution and supply chain management company reported consolidated net profit of Rs 18.8 crore for the quarter ended December FY24, up from a loss of Rs 4.7 crore in the same period last year. During the quarter, revenue from operations decreased by 3.8 percent on an annual basis to Rs 424.5 crore.
UPL: Due to a sharp decline in topline and subpar operating results, the crop solutions company reported a consolidated net loss of Rs 1,217 crore for the third quarter of FY24, compared to a profit of Rs 1,087 crore in the same time last year. Comparing the current fiscal period to the same period last year, consolidated revenue from operations decreased by 27.7% to Rs 9,887 crore.
Pricol: Through open market transactions, Societe Generale, a financial services organisation based in Europe, acquired 8,24,704 equity shares, or 0.68 percent, in the company that manufactures automotive components at an average price of Rs 408.05 per share. Nevertheless, 20 lakh equity shares, or 1.64 percent of paid-up equity, were sold by private equity firm PHI Capital Solutions LLP at an average price of Rs 408.08 per share. PHI Capital has been selling its shares of Pricol since December 2023. As of December 2023, it owned 25.4 lakh shares, or 2.08 percent, compared to 5.73 percent, or 69.84 lakh shares, as of September 2023.
Affle: Despite a low operating margin, the consumer intelligence-driven global technology business recorded net profit of Rs 76.8 crore for the third quarter of FY24, up 11.4 percent from the same period the previous year. The operating revenue for the quarter was Rs 498.7 crore, up 32.6 percent year over year. The revenue for the CPCU sector climbed by 38.2 percent year over year to Rs 477.4 crore.
Metropolis Healthcare: Weak operating metrics and little topline growth contributed to the diagnostic services provider’s 25% year-over-year drop in net profit, which came in at Rs 27 crore for the quarter that ended in December of FY24. In comparison to the same time last year, income from operations climbed by 2.1 percent to Rs 291 crore, while revenue from core business (which does not include COVID and COVID-allied PPP contracts) jumped by 12.6 percent to Rs 286 crore.
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