Daily Big Picture : Nifty Finds Resistance Near 12,000; Cipla, Exide Industries Q2 Profit Beats Consensus

Today’s Action

Nifty, +0.4%; Sensex, +0.6%; Nifty Midcap, 0.0%; Nifty Smallcap, -0.2%; Model Portfolio, +0.03%.

Daily Market Review.

Market Status: Confirmed Uptrend

Nifty opened lower, but rebounded more than 100 points from low of 11,850. Private banks and realty stocks led the gain. Nifty briefly crossed 12,000 mark, but found resistance there and closed below it. The broader market underperformed the large cap indices. Nifty Midcap closed flat, while the Smallcap closed 0.3% lower.

On the sectoral front, Nifty Private Banks (+1.4%) and Realty (+2.3%) were the top gainers. Nifty Auto (-0.2%), Media (-0.5) and PSU Banks (-0.9%) closed in negative territory. Advance-decline ratio was leaned toward decliners. Of 2,144 stocks traded on the NSE, 867 advanced, 931 declined, and the rest remained unchanged.

Looking ahead, we would like to see Nifty breakout from its all-time high of 12,103. Currently, it has three distribution days with two of them expiring next week. Also, there were a couple of instances in the last week, when the market was stalling. Fresh positions should only be taken in stocks that are emerging from sound bases, preferably with an RS line at or near new highs. Avoid taking new positions in stock if its results are due within a week.

Key News

Cipla (+2.8%) Q2 FY20 results beat consensus. PAT increased 25% y/y to Rs 471.3 crore. Revenue increased 9.6% y/y to Rs 2,661 crore. Margin expanded 320bps y/y to 20.7%. EBITDA was up 29.5% y/y to Rs 909.5 crore. PAT came higher even after increaser in tax expenses.

Exide Industries (-1.2%) Q2 FY20 results beat consensus. PAT increased 24.4% y/y to Rs 237.3 crore. Revenue declined 4% y/y to Rs 2,661 crore. Margin expanded 190bps y/y to 14.1%.

Radico Khaitan (-4.2%) Q2 FY20 PAT grew 58% y/y. Revenue grew 10.1% y/y to Rs 570 crore. EBITDA was down 5.6% y/y to Rs 86.5 crore. Margin contracted 250bps y/y to 15.2%. PAT was higher due to tax credit of Rs 16 crore versus expense of Rs 26 crore y/y.

Alkyl Amines Chemicals (+7.1%) reported good numbers. Revenue from operations grew 7.3% y/y to Rs 234.97 crore. Margin expanded 200bps y/y to 24.6%, the share of profit from associate company has rose 60% to Rs 1.63 crore. PAT at Rs 55 crore is up 107% y/y.

Godrej Consumer Products (+3%) reported Q2 FY20 results. PAT came above consensus, while revenue was a miss. PAT was down 28% y/y to Rs 414 crore. Revenue was marginally down on y/y basis. Margin expanded 340bps y/y to 21.7%.

What do you think? Please email us any questions or comments.

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