Trade Setup | Positive cues fueling hopes of a gap-up opening for #Nifty. #BQLive
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00:00 me Tamanna and Amdar. As we get into the festive week celebrations, the hopes are up that we will
00:07 see a good festive opening to the markets today as well. Let's tell you what's happening. Let's
00:12 start with the global news flow which has continued the party after Friday's markets
00:17 are shut in the grain. So you have seen a great closing on Wall Street as well and this is what's
00:25 been happening. Fewer jobs, higher unemployment has driven down US bond yields and back this up
00:32 with what the Fed said last week where it gave indications that there was no immediate need to
00:39 increase interest rates. There was a pause on. In fact, hopes are now growing that you will see the
00:45 reverse perhaps even as early as June. So the jobs report which came in in the US is an important
00:52 trigger of what we saw in the US markets, in global markets and you saw that happening in
00:56 European markets and in Asian markets this morning. US jobs saw 150,000 increases for the month
01:04 versus 170,000 which was expected. Unemployment was at 3.9% which was the highest since Jan 2022.
01:12 This is giving hopes that there would be no real need for the Fed to increase rates any further.
01:19 US stocks rose on the back of this. Bond yields fell and this is bolstered hope that the Fed is
01:24 done with hikes for now. The US 10-year treasury was in fact at 4.57%. As per Bloomberg, hopes of
01:32 a cut have now emerged even as early as June. European and Asian markets also largely closed
01:40 higher in Friday trade and like we said the party is continuing in Asian markets. Hang Seng, Nikkei,
01:46 Kaspi all trading over 2-3%. The Kaspi in fact almost up 4% on a rule by the government,
01:54 the Korean government that short selling will be banned till June of 2024 and that has bolstered
02:02 the Kaspi. Brent futures have also cooled off to 84-89 as the geopolitical risk fears ease. So,
02:10 we are going into trade today with an expectation of bond yields cooling off, Brent cooling off,
02:17 interest rate hikes scares on the back burner. So, the global news flow largely positive. Let's
02:23 see what's happening domestically and really the trigger here continues to be quarterly results,
02:28 Q2 results. A mixed bag but overall so far with the numbers we have pointing to the positive side.
02:35 So, all of these positive cues are fueling the hope of a gap up opening. That's the large
02:42 consensus and we hope that follows through that we will go into trade today with a gap up opening.
02:48 But the real party will begin truly once FBIs turn tide. Now, look at what's happening with
02:54 foreign investors. Just in November so far, in the first three days of trade in November,
03:00 they pulled out 3,400 crore rupees. Foreign investors were net sellers on Friday as well.
03:06 It's the domestic investors which are continuing to buy. And over the last couple of months,
03:12 we've seen that trend. Now, the hopes are to really push this positive mood into a bull market.
03:20 We need to see if the foreign investors and FBIs come back to the table. Now, a weekly trading
03:26 range is expected between 19,000 and 19,550. That's where the resistance levels are being
03:32 looked at at 19,500 or 19,550. But a great column on the side from CK Narayan over the weekend,
03:38 who's recommended stops at 19,000 and 19,145. You should go back and read that on bqprime.com
03:46 if you've missed it. Let's just quickly tell you what was happening on Friday. Markets ended in a
03:52 good mood on Friday, the second consecutive day. On November 3rd, BSE Sensex was up 283 points
03:58 to 64,364, while the Nifty was up 97 points at 19,231. And we're hoping that continues.
04:08 Let's just tell you another factor to look at today since quarterly results is the big driver
04:16 in terms of domestic news right now. Divi's Laboratory, Bharat Forge, Hindustan Petroleum,
04:22 HPCL, that's a big one, FSN E-commerce Ventures, the company that runs the brand, Nika, Adani
04:29 Energy Solutions, Bajaj Electricals, Imami, Exide, Glant Pharma, NHPC, Sobha, some of the numbers
04:36 that we will be looking at. Varun Beverages as well, one to keep an eye out on. But it was a
04:43 very, very busy weekend because we've had a slew of numbers coming in. And I'm going to talk about,
04:49 I would say, the big one, SBI, State Bank of India. Everyone was waiting for that. Overall,
04:55 good numbers. And that is the commentary coming in this morning from brokerage reports as well.
05:00 I'll quickly take you through what happened. Net profit for the quarter rose to 14,330 crores in
05:06 the July-September quarter compared to 13,625 crores a year ago. So year-on-year about 8%.
05:13 We also saw net interest income rising 12% from a year ago. Other income too rose by about 21%.
05:22 Operating profit fell 8.07% year-on-year for that quarter. And NIMS also slipped by 12 basis points.
05:31 But the slippage in the NIMS, in the net interest margin, was actually less than what was expected.
05:37 Interesting insights from the CON calls also which took place. SBI is expecting a 12% to 14%
05:44 loan growth and FY24 can improve further. NIMS will remain largely stable. That's what the
05:51 management was saying. They expect an industry credit growth at 16% to 17% year-on-year.
05:56 And the important bit, 3.4 trillion of proposals in pipeline and 1.4 trillion rupees pending for
06:05 disbursement. So, a strong corporate pipeline over there, totaling 4.8 trillion. They also expect
06:12 growth to be 14% and expect a surprise on the higher side. A lot of brokerage reports out this
06:18 morning and most of them looking fairly positive, giving a target price between 700 and 710 for SBI.
06:25 So, that's definitely going to be a stock to watch. Bank of Baroda also had numbers out.
06:31 Just giving you some insights from the CON calls which took place. They say total advances growth
06:36 is expected to be 14% to 16% for FY24. The retail book is expected to grow at 20% to 22%.
06:43 Deposits growth to be 12% to 13% for FY24. The NIM guidance which they've given is at 3.15%.
06:52 The banking space will be one to look at, especially PSU banks.
06:57 Titan also had numbers out over the weekend. They've retained their margin guidance of 12%
07:02 to 13% for FY24, but have experienced a drop in diamond prices, particularly in higher carat
07:10 solitaires due to international demand and supply dynamics. That's actually happening all over the
07:15 world where diamond prices are losing their glitter. This might lead to margin dilution over
07:21 next 7 to 8 months. The carat lien story was the big one as far as Titan is concerned.
07:26 Zomato, again, numbers that have surprised on the positive side, at least Prima Facie,
07:32 it seems so. They've reiterated its goal of achieving 4% to 5% of their margins in food
07:37 delivery. Majority of long-term growth will be driven by an earning increase in monthly
07:43 transacting customers. And Zomato numbers will also be on the radar today. A lot of earnings
07:51 that came out post-market hours which we should look at. Interglobe Aviation revenue was up nearly
07:56 20% at 14,943 crores versus 12,497 crores. Their EBITDA was at 2,396 crores, so big jump there.
08:10 Margins at 16% versus 1%. Reported profits at 189 crores versus loss of 1,583 crores. This is the
08:20 leader in the domestic aviation market which is showing healthy profit. Thermax numbers were good.
08:26 Sudarshan Chemicals as well I would watch out for. Revenue up 14%. EBITDA up 66% for the quarter
08:34 versus 35.8 crores. Margins up 10% and reported profit at 17.86 crores. There were some companies
08:43 with not so great numbers as well. I'll just quickly go through them for you. JK Papers was one
08:49 where EBITDA was down over 24% at 408 crores versus 540 crores. Margins were at 24.69% versus
08:59 32.82%, so slip in margins as well. And reported profit was down 6.8% at 302 crores. SCI,
09:08 Shipping Corporation of India, also not a very great set of numbers. Revenue down 23%, EBITDA
09:14 down 27%. Margins have slipped as well. Reported profit down 42%. Gujarat Fluoro Chemicals revenues
09:24 down 35%. EBITDA down 69%. And margins at 17% versus 36%, so a big, big slip over there coming
09:34 in. Their reported profit was down 85%. So these are some stocks which will possibly react negatively
09:41 on the basis of weak quarterly numbers. IPO Watch, just to mention before we wrap up,
09:48 Seller World will be coming out with its listing today on November 6th. The final issue price was
09:54 fixed at 648 per share. So a lot to watch out in today's trade, but let's simply say, if you put it
10:02 in a nutshell, that we're looking at a good start perhaps to this week right now with the hope of a
10:09 gap up. And we are going to be taking you through all of that through the day. Remember, we're
10:14 talking about these companies in detail with their management. You have to tune in for that. Just
10:20 telling you what we have lined up on the shows for you today. Ashok Santalia, CFO of Titan,
10:26 will be joining us at a quarter to 10. 10.45, Amira Shah, Promoter and MD, Metropolis Healthcare.
10:33 Hemant Jalan, Chairman and MD, Indigo Paints, will be with us today at 1. And 1.30, you will have
10:39 Kavita Shirvaikar, CFO and whole-time Director, Patel Engineering. On Talking Point today at 10,
10:46 you will hear from Mihir Vohra, CIO of TrustMF. And of course, you'll have the F&O Show at 10.30.
10:54 Stocks in Focus at 11. So you have a full day up for you on BQ Prime. Don't forget to tune in.
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11:13 1.25.1 Presented by Hemant Jalan, Chairman and MD, Metropolis Healthcare.