Sensex opens marginally lower; L&T and Bajaj Finance top losers4 min read . Updated: 23 Jul 2021, 10:19 AM IST
- Indian share markets open marginally lower. The BSE Sensex opened down by 151 points, while the Nifty is trading lower by 42 points.
Asian share markets are trading on a mixed note after a volatile week in which sentiment over global growth waxed and waned with every new headline on the Delta variant.
The Hang Seng is down 1.1% while the Shanghai Composite is trading lower by 0.6%.
In US stock markets, tech stocks helped Wall Street inch up to a higher close, modestly building on a two-day rally as lacklustre economic data and mixed corporate earnings prompted a pivot back to growth stocks.
The Dow Jones Industrial Average rose 0.1%, and the Nasdaq Composite added 0.4%.
Back home, Indian share markets have opened marginally lower, following the trend on SGX Nifty.
Market participants will track shares of JSW Steel, SBI Cards, Yes Bank and Federal Bank as these companies will report their quarterly numbers today.
The BSE Sensex is trading down by 151 points. Meanwhile, the NSE Nifty is trading lower by 42 points.
HCL Tech and Tata Steel are among the top gainers today. Bajaj Finance, on the other hand, is among the top losers today.
The BSE Mid Cap index has opened up by 0.5%. The BSE Small Cap index is trading higher by 0.6%.
Sectoral indices are trading mixed with stocks in the metal sector and IT sector witnessing buying interest.
Telecom stocks, on the other hand, are trading in red.
Shares of Coforge and Lux Industries hit their 52-week highs today.
The rupee is trading at 74.48 against the US$.
Gold prices are trading up by 0.2% at ₹47,650 per 10 grams.
Meanwhile, silver prices are trading up by 0.4% at ₹66,678 per kg.
In news from the IT sector, Tanla Platforms is among the top buzzing stocks today.
Tanla Platforms, formerly known as Tanla Solutions, has reported a net profit of ₹1,045 m in the first quarter ended June 2021.
This compares with a net profit of ₹786 m reported in the same quarter last year.
This is the second consecutive quarter for the company to deliver a net profit of over ₹1,000 m.
The company registered a net income of ₹6,306.8 m in the quarter under review as against ₹4,687.7 m in the year ago period.
The company’s board also approved a buyback plan for an aggregate amount not exceeding ₹650 m at a price (not exceeding) ₹1,260 per share from the open market through stock exchange mechanism.
Uday Reddy, Chairman and Chief Executive Officer of Tanla Platforms said,
"The operating profit and net profit are at an all-time high, driven by increasing contribution from our platform business.
Our top 20 customers have grown by 31% and we have 13 customers with annualised revenues greater than ₹500 m in the quarter."
Tanla Platforms share price has opened the day up by 4.2%.
Note that shares of the company have seen a spectacular rally in the past year.
From the lows of ₹98 touched on 21 July last year, shares of Tanla Platform are currently trading at ₹1,026. A gain of 947%!
At the current price, the company commands a marketcap of ₹137.4 bn.
Speaking of smallcap stocks, despite the smallcap index being up more than 1.8 times, Richa Agarwal, lead Smallcap Analyst at Equitymaster, believes smallcap stocks are set for a massive up move in 2021 and beyond.
The 188% gain in the smallcap index in current rebound is way short of almost 300% gains in the last two rebound cycles.
Here's what Richa wrote in a recent edition of Profit Hunter...
The Smallcap to Sensex ratio, a metric I often refer to get a sense of relative valuations, currently stands at 0.49 times. To be sure, this is higher than a median of 0.43 times.
And yet, it's the lowest of all the peaks in the smallcaps so far. In the last cycle which peaked in January 2018, when the ratio touched 0.49, the peak was still 9 months away.
As per Richa, smallcaps are a great opportunity to make some big returns. But you need to stay disciplined when it comes to allocating money. And you need to be sharp when picking the right stocks.
If you get these two things right, smallcaps will work wonders for you.
Moving on to news from the IPO space, market participants will closely track shares of Zomato, which are scheduled to list on the bourses today.
Reports suggest Zomato’s shares are expected to list at above ₹100 per equity price.
According to market experts and grey market premium of the public issue, both financials and short-term sentiment is favouring strong listing with 35 to 40% premium.
Zomato IPO GMP today is ₹27 which is ₹4 up from its yesterday's grey market premium of ₹23.
Zomato, the first of a generation of internet start-up to tap India’s primary markets, has generated a hype among the investment community.
Its IPO is India’s biggest since March 2020, and got about 35 times more bids from anchor investors than shares it intended to sell.
The performance of Zomato shares today will serve as a barometer for India’s unprofitable startups.
Speaking of Zomato's listing, Equitymaster's telegram channel is conducting a poll to know about the mindset of market participants towards the company's listing.
The question asked by us was as follows:
Zomato lists today. What’s your take on the listing price?
According to the poll data, around 53% of participants said the shares would list sharply above the issue price, while 34% said it would list at or around the issue price. (Sample size - 312).
There were also 13% contrarians who voted in the category of shares to list sharply below the issue price.
If you haven't subscribed to Equitymaster's telegram channel yet, you can do so here.
This article is syndicated from Equitymaster.com
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