..... . VALI disclosures . .....: 22/01/25, Nifty Levels/BIZnews /

Wednesday, January 22, 2025

22/01/25, Nifty Levels/BIZnews /

Stocks in the Asia-Pacific region tracked overnight gains on Wall Street in hopes that President Donald Trump's policies would boost the outlook for the world's biggest economy.

Australia's S&P/ASX 200 opened higher with the benchmark index advancing by 0.57%, or 48 points, to 8,451 as of 6:25 a.m. Japan's Nikkei was up 505 points, or 1.29% at 39,529. Future contracts in China and Hong Kong hinted at a cautious start.

Stocks in China gained in Tuesday's session as Trump held off from imposing trade tariffs in his inaugural speech but later said he is considering a 10% levy as early as Feb. 1.

Meanwhile, Trump pushed to make the US an AI superpower by having fewer guardrails by immediately halting the implementation of key safety and transparency requirements for AI developers.

US ten-year treasury yields advanced after falling five basis points in the previous session while the stocks added to their 2025 gains. The S&P 500 and the Dow Jones Industrial Average rose 0.88% and 1.24%, respectively. The tech-heavy Nasdaq Composite climbed 0.64%.

Indian benchmark indices extended their selloff on Tuesday, closing at their lowest levels since the June crash, as investor sentiment was rattled by uncertainty surrounding US President Donald Trump's trade tariffs. The spike in market volatility coincided with the weekly expiry of Sensex futures contracts.

The session fluctuated between gains and losses, eventually ending over 1.5% lower, with a sharp selloff in realty and energy stocks. Zomato dropped 13%, while Dixon Technologies (India) Ltd. fell 14% following weak third-quarter earnings reports.

The S&P BSE Sensex closed down by 1,235.08 points, or 1.6%, at 75,838.36, while the NSE Nifty 50 declined by 320.10 points, or 1.37%, to close at 23,024.65. Intraday, the NSE Nifty 50 fell 1.58% to 22,976.8, and the S&P BSE Sensex dropped 1.86% to 75,641.8.

Earnings To Watch

Nifty Earnings To Watch: Bharat Petroleum Corp., HDFC Bank, Hindustan Unilever.

Other Earnings To Watch: 20 Microns, Accelya Solutions India, Adroit Infotech, Alldigi Tech, BLB, Cigniti Technologies, Coforge, Elecon Engineering Co., Go Digit General Insurance, Gravita India, Heritage Foods, Housing & Urban Development Corp. Indosolar, Jagsonpal Pharmaceuticals, Laxmi Organic Industries, NIIT Learning Systems, Nuvoco Vistas Corp., Persistent Systems, Pidilite Industries, Polycab India, R. S. Software (India), RattanIndia Power, Spentex Industries, Stel Holdings, Take Solutions, Tata Communications, Tips Music, Ujaas Energy, Vardhman Textiles, Wendt (India), Zensar Technologies, Abhishek Corp., Akg Exim, Amit Spinning Industries, E2E Networks, Gujarat Apollo Industries, Kaynes Technology India, Kritika Wires, Mittal Life Style, Muthoot Capital Services, Powergrid Infrastructure Investment Trust, Shivam Autotech, SRG Housing Finance, Bharat Bhushan Finance & Commodity Brokers, Comfort Fincap, Comfort Intech, IIRM Holdings India, Jamshri Realty, Key Corp, Kisan Mouldings, KMG Milk Food, Monotype India, Quest Capital Markets, Real Growth Corp., Shradha AI Technologies, Trident Lifeline, Triveni Glass, Yamini Investments Co., Nilkanth Engineering.

Earnings Post Market Hours

ICICI Prudential Q3 Earnings

Net Premium Income up 23% at Rs 12,261 crore versus Rs 9,929 crore (Cons, YoY).
Net profit up 43% at Rs 325 crore versus Rs 227 crore (Cons, YoY).
Solvency Ratio at 211% versus 188% (Cons, QoQ).
13th Month Persistency at 85.8% versus 86.4% (Cons, QoQ).

Cyient DLM Q3 Earnings (Cons, YoY)

Revenue up 38% at Rs 444 crore versus Rs 321 crore (Estimate: Rs 450 crore).
Ebitda down 4% at Rs 28 crore versus Rs 29 crore (Estimate: Rs 42.4 crore).
Margin down 270 basis points at 6.3% versus 9% (Estimate: 9.4%).
Net profit up 40% at Rs 10.8 crore versus Rs 18 crore (Estimate: Rs 26 crore).

Rossari Biotech Q3 Earnings

Revenue up 10.6% at Rs 513 crore versus Rs 464 crore (Cons, YoY).
Ebitda up 1.9% at Rs 64.7 crore versus Rs 63.5 crore (Cons, YoY).
Margin at 12.6% versus 13.7% (Cons, YoY).
Net profit down 7.6% at Rs 31.7 crore versus Rs 34.3 crore (Cons, YoY).

Tanla Platforms Q3 Earnings

Revenue down 0.03% at Rs 1,000 crore versus Rs 1,001 crore (Cons, QoQ).
Ebit down 8.6% at Rs 139 crore versus Rs 152 crore (Cons, QoQ).
Ebit Margin at 13.9% versus 15.2% (Cons, QoQ).
Net profit down 9% at Rs 119 crore versus Rs 130 crore (Cons, QoQ).

PNB Housing Q3 Earnings

Total Income up 9.9% at Rs 1,925 crore versus Rs 1,751 crore (YoY).
Net profit up 36% at Rs 471 crore versus Rs 346 crore (YoY).

Tata Tech Q3 Earnings

Revenue up 1.6% at Rs 1,317 crore versus Rs 1,296.5 crore (Cons, QoQ).
EBIT down 1% at Rs 204 crore versus Rs 206 crore (Cons, QoQ).
EBIT Margin down at 15.5% versus 15.8% (Cons, QoQ).
Net profit up 7.1% at Rs 169 crore versus Rs 157 crore (Cons, QoQ).

Dalmia Bharat Q3 Earnings

Revenue down 11.7% at Rs 3,181 crore versus Rs 3,604 crore (Cons, YoY).
Ebitda down 34.4% at Rs 511 crore versus Rs 779 crore (Cons, YoY).
Margin at 16.1% versus 21.6% (Cons, YoY).
Net profit down 75.2% at Rs 66 crore versus Rs 266 crore (Cons, YoY).

KEI Industries Q3 Earnings

Revenue up 19.8% at Rs 2,467 crore versus Rs 2,059 crore (Cons, YoY).
Ebitda up 12.3% at Rs 241 crore versus Rs 214 crore (Cons, YoY).
Margin at 9.6% versus 10.4% (Cons, YoY).
Net profit up 9.4% at Rs 165 crore versus Rs 151 crore (Cons, YoY).

Jana SFB Q3 Earnings

NII up 8% at Rs 593 crore versus Rs 548 crore (YoY).
Net profit down 17.8% at Rs 111 crore versus Rs 135 crore (YoY).
Gross NPA at 2.8% versus 2.97% (QoQ).
Net NPA at 0.94% versus 0.99% (QoQ).

IndiaMART Q3 Earnings

Revenue up 16% at Rs 354 crore versus Rs 305 crore (Cons, YoY).
Ebitda up 61.4% at Rs 138 crore versus Rs 85.7 crore (Cons, YoY).
Margin at 39% versus 28.1% (Cons, YoY).
Net profit up 47% at Rs 121 crore versus Rs 81.9 crore (Cons, YoY).

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Trade Cycles

The four important features of Trade Cycle are (i) Recovery, (ii) Boom, (iii) Recession, and (iv) Depression!

The trades cycle or business cycle are cyclical fluctuations of an economy. A full trade cycle has got four phases: (i) Recovery, (ii) Boom, (iii) Recession, and (iv) depression. The upward phase of a trade cycle or prosperity is divided into two stages—recovery and boom, and the downward phase of a trade cycle is also divided into two stages—recession and depression.

Phases of Trade Cycle:

The phases of trade cycle are explained with a diagram:

(1) Recovery:

In the early period of recovery, entrepreneurs increase the level of investment which in turn increases employment and income. Employment increases purchasing power and this leads to an increase in demand for consumer goods.

As a result, demand for goods will press upon their supply and it shall, thereby, lead to a rise in prices. The demand for consumer’s goods shall encourage the demand for producer’s goods.

The rise in prices shall depend upon the gestation period of investment. The longer the period of investment, the higher shall be the price rise. The rise of prices shall bring about a change in the distribution of income. Rent, wages, interest do not rise in the same proportion as prices.

Consequently, the margin of profit improves. The wholesale prices rise more than retail prices. The prices of raw materials rise more than the prices of semi-finished goods and the prices of semi-finished goods use more than the prices of finished goods.

(2) Boom:

The rate of investment increases still further. Owing to the spread of a wave of optimism in business, the level of production increases and the boom gathers momentum. More investment is possible only through credit creation. During a period of boom, the economy surpasses the level of full employment and enters a stage of over full employment.

(3) Recession:

The orders for raw materials are reduced on the onset of a recession. The rate of investment in producers’ goods industries and housing construction declines. Liquidity preference rises in society and owing to a contraction of money supply, the prices falls. A wave of pessimism spreads in business and those markets which were sometime before sellers markets become buyer’s markets now.

(4) Depression:

The main feature of a depression is a general fall in economic activity. Production, employment and income decline. The prices fall and the main factor responsible for it is, a fall in the purchasing power.

The distribution of national income changes. As the costs are rigid in nature, the margin of profit declines. Machines are not used to their full capacity in factories, because effective demand is much less. The prices of finished goods fall less than the prices of raw materials.

✳Reality Tips to Traders

1)Trading in the stock market is a marathon. 2)Protecting your capital is key. (Learn to protect first) 3)Making 0 on the day is better than losing 50k 4)Losses happen; they are part of this business. 5)It’s not you vs. the market. It’s you VS you. 6)You are your biggest enemy; learn to be mentally disciplined. 7)Don’t follow the majority; follow the correct path. 8)Traders without a stop loss end up not being traders for long. 9)There is always another trade. 10)The big money is made waiting for the right set-ups. 11)Waiting for the right trade is the most powerful strategy. 12)It is better to cut a loss than to wait to be proven right. 13)Position sizing can make or break you. 14)Worry about the downside before you even think about the upside. 15)Don’t listen to headlines

..BANKING TERMINOLOGY

There are various types of Banks: PSU Banks, Private Banks, Co-operative/Regional Banks, Small Finance Banks and Foreign Banks. When you deposit money in a bank, let's say the bank gives you an interest rate of 4%. But when the bank lends out this money, they lend it out at say, 12%. The difference of 8% in the above scenario is effectively the profit of the bank! The loans that do not pay interest for 90 days are known as Non-performing Assets. Banks have to provide for such bad loans. Structure of a Bank Asset for a Bank: The asset portion of a bank's capital includes cash, government securities, and interest-earning loans (e.g., mortgages, letters of credit, and inter-bank loans). Liabilities for a Bank: The bank's main liabilities are its capital (including cash reserves and, often, subordinated debt) and deposits. The latter may be from domestic or foreign sources (corporations and firms, private individuals, other banks, and even governments). Banks are required to maintain Liquidity with the Reserve Bank of India: SLR (Statutory Liquidity Ratio): It is the money a bank needs to preserve in the form of cash, gold or government Bonds before providing credit customers. This limitation is added by RBI on banks to make funds available to customers on-demand at your earliest convenience. Banks are required to maintain SLR at 18%. CRR (Cash Reserve Ratio): Banks are required to hold a certain proportion of their deposits in the form of cash. Banks don’t hold these as cash with themselves, but deposit such amounts with RBI / currency chests. CRR rate is at 4.5% currently. Repo Rate: The rate at which the RBI lends short-term money to the banks. The RBI through its Monetary Policy committee changes the repo rate to balance growth and Inflation. Reverse Repo rate: The rate at which banks park their short-term excess liquidity with the RBI. Now let us understand various terminologies for Banks Net Interest Income (NII): This is the spread the bank makes on its lending. It is calculated as Interest Income – Interest Expended Net Interest Margin (NIM): This is the spread the bank makes on its lending. It is the earning which is left after deducting the cost paid to depositors from its yields on Loans. This is denoted in % terms. The formula is Yield on Loans – Cost of funds Capital Adequacy Ratio (CAR): The capital adequacy ratio (CAR) is a measure of a bank's available capital expressed as a percentage of a bank's risk-weighted credit exposures. Essentially, it is the Capital that is available to lend. Tier I Capital – In simple words this capital is freely available with the bank to lend out. Tier II Capital- This is the capital tied up somewhere and is less freely available to lend. In case of an adverse event, the bank can use this capital to lend. Under Basel III norms, a bank’s tier 1+tier 2 capital must be a minimum of 8% of its risk-weighted holdings. The minimum capital adequacy ratio, also including the capital conservation buffer, is 10.5%. Current Account Saving Account (CASA)- There is no interest paid on the Current Account and a small interest rate is paid on a savings account. The combination of both is called CASA which shows the liabilities of the bank on which it pays relatively less interest. Deposits: Bank deposits are a savings product that customers can use to hold an amount of money at a bank for a specified length of time. In return, the financial institution will pay the customer the relevant amount of interest, based on how much they choose to deposit and for how long. Now let us come to NPA. Gross NPA (GNPA): It is the total loans on which no payment has been paid for 90 days or more. GNPA % is usually shown in each Bank’s quarterly results. The percentage is basically the GNPA amount as a % of the total advances. Slippages: Slippages denote the fresh amount of loans that have turned bad in a year. The slippage ratio of a bank is calculated as Fresh accretion of NPAs during the year /Total standard assets at the beginning of the year multiplied by 100. Provisioning Coverage Ratio (PCR): This is the ratio of provisioning to GNPA and indicates the extent of funds a bank has kept aside to cover loan losses. For Instance, a company has GNPAs of Rs 100 and they have set aside 50 Rs, then the PCR is 50%. Net NPA (NNPA): The total figure left after deducting provisions made for bad loans from GNPA. (GNPA – Provisions+upgrades/writeoffs = NNPA) Special Mention Account (SMA) SMA-0 is a category in which stress with respect to the principal and interest has remained overdue for a period of 0 to 30 days. SMA-1 is a category in which stress with respect to the principal and interest has remained overdue for a period of 30-60 days. SMA-2 is a category in which stress with respect to the principal and interest has remained overdue for a period of 60-90 days

..... . VALI disclosures . .....

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Wednesday, January 22, 2025

22/01/25, Nifty Levels/BIZnews /

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