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Bourses remain positive in late morning deals

09 Jul 2020 Evaluate

Indian equity benchmarks remained positive in late morning deals, on the back of firm cues from other Asian markets. In line with the larger peers, the broader indices were too trading in green terrain in late morning deals. Traders were positive, as the Cabinet approved a proposal to extend distribution of free foodgrains and pulses under the Pradhan Mantri Garib Anna Yojana (PMGKAY) to 81 crore PDS beneficiaries for five months till November. The scheme was initially rolled out for three months till June to ensure no poor goes hungry during the COVID-19 crisis.

On the global front, Asian markets were trading mostly in green, after China's producer prices declined for the fifth straight month in June, but the pace of deflation eased as the economy showed signs of recovery from the coronavirus driven downturn. Producer prices dropped 3 percent on a yearly basis, slower than the 3.7 percent fall seen in May. Although this was the fifth consecutive decrease in prices, the pace of fall slowed in June.

The BSE Sensex is currently trading at 36591.75, up by 262.74 points or 0.72% after trading in a range of 36422.30 and 36636.48. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.07%, while Small cap index was up by 0.41%.

The top gaining sectoral indices on the BSE were Metal up by 2.48%, Basic Materials up by 1.19%, Bankex up by 1.10%, Healthcare up by 0.49% and Energy up by 0.42%, while Capital Goods down by 0.45%, FMCG down by 0.44%, Consumer Durables down by 0.35%, Power down by 0.17% and Auto down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Finance up by 4.10%, Tata Steel up by 3.25%, Bajaj Finserv up by 2.83%, HDFC up by 2.59% and Axis Bank up by 2.11%. On the flip side, Tech Mahindra down by 1.67%, Titan Company down by 0.79%, ITC down by 0.74%, TCS down by 0.71% and ONGC down by 0.61% were the top losers.

Meanwhile, ratings agency Crisil in its latest report has said that two consecutive years of double-digit decline in sales volume and a 50-100 basis points moderation in already thin operating profitability are expected to materially dent the credit metrics of automotive dealers this fiscal. In a report based on the analysis of 2,051-Crisil-rated dealers, it said vehicles sales, which dropped 18% in 2019-20, are likely to shrink by around a quarter this fiscal owning to COVID-19 pandemic coupled with weak business environment amid restricted mobility and curtailed discretionary spending.

Also, the ability of automotive dealers to withstand such demand contraction has reduced because of lower sales volume per dealer, given the aggressive dealership expansions adopted by the Original Equipment Manufacturers (OEMs) over the past six fiscals. It said in fiscal 2021, a sharp decline in vehicle sales volume and ancillary income will lead to a 50-100 basis points moderation in operating profitability because of sub-optimal coverage of fixed costs. This drop is substantial, considering the thin operating margin of 3-4% of dealers and around 50 basis points moderation already seen last fiscal.

The report said dealers with own showrooms and those with higher mix of the more profitable ancillary services will be better placed to withstand the shock. As per Crisil Ratings, the ancillary revenue, comprising spare parts and insurance, amounts to 10-12 per cent of the total revenue. It said commercial vehicle (CV) dealers are expected to be the most impacted due to the sharpest drop expected in sale volumes and lower profitability of 2-3%, compared with passenger vehicle (PV) and two-wheeler (2W) dealers. Tepid sales, carry-over stocks of BS-IV vehicles (mainly 2Ws and PVs), and squeeze in profitability will lead to net losses in the first half of the fiscal, increasing their reliance on working capital lines, and impacting liquidity position for most dealers.

The CNX Nifty is currently trading at 10772.60, up by 66.85 points or 0.62% after trading in a range of 10733.00 and 10792.10. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 4.65%, Bajaj Finance up by 4.03%, GAIL India up by 3.46%, Tata Steel up by 3.29% and Vedanta up by 3.08%. On the flip side, Bharti Infratel down by 1.91%, Tech Mahindra down by 1.53%, Hero MotoCorp down by 1.27%, Wipro down by 1.23% and UPL down by 0.93% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 202.23 points or 0.9% to 22,640.88, Hang Seng increased 123.18 points or 0.47% to 26,252.36, Taiwan Weighted strengthened 45.28 points or 0.37% to 12,215.47, Shanghai Composite gained 35.17 points or 1.03% to 3,438.61, KOSPI rose 20.28 points or 0.94% to 2,179.16 and Jakarta Composite soared 16.36 points or 0.32% to 5,092.53. On the flip side, Straits Times trembled 8.54 points or 0.32% to 2,660.95.

SEBI Registered: Investment Adviser - INA000013323

Name of the IA registered with SEBI:	The Alchemists Ark Pvt. Ltd.
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Trade/Brand Name of IA:	MoneyWorks4Me Investment Advisers
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SEBI Registration Number:	INA000013323 Validity - May 16, 2019 - Perpetual
Registration:	Non-Individual
BSE Enlistment No:	1187
Address:	B-101, Signet Corner Building, Balewadi Phata, Baner, Pune, Maharashtra 411045
Compliance officer Details:	Name: Shrikant Jagtap Email: shrikant.jagtap@moneyworks4me.com Telephone: +919860359463 Address: Same as IA
Grievance Officer Details:	Name: Mukta Vaze Email: mukta.vaze@moneyworks4me.com Telephone: +91 98609 19463 Address: Same as IA
Principal Officer Details:	Name: Atharva Bhide Email: atharva.bhide@moneyworks4me.com Telephone: +91 91758 99463 Address: Same as IA
Standard Warning:	Investment in securities market are subject to market risks. Read all the related documents carefully before investing.
Disclaimer:	Registration granted by SEBI, enlistment with exchange and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

Warning: Investment in securities market are subject to market risks. Read all the related documents carefully before investing.

Disclaimer: Registration granted by SEBI, membership of BASL (in case of IAs) and certification from NISM in no way guarantee performance of the intermediary or provides any assurance of returns to investors.

Compliance Officer:

Name: Shrikant Jagtap

Email: shrikant.jagtap@moneyworks4me.com

Mobile No: +91 97638 00745

Grievance Officer:

Name: Mukta Vaze

Email: mukta.vaze@moneyworks4me.com

Mobile No:+91 98609 19463

Principal Officer:

Name: Atharva Bhide

Email: atharva.bhide@moneyworks4me.com

Mobile No:+91 91758 99463

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Plot No. C 4-A , G Block, Near Bank of India, Bandra Kurla Complex, Bandra East, Mumbai, Maharashtra 400051

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The Alchemists Ark Pvt. Ltd., B-101, Signet Corner Building, Balewadi Phata, Baner, Pune, Maharashtra 411045

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