Benchmarks continue to trade higher in morning deals

Indian equity benchmarks continued to trade higher in morning deals, led by gains in Realty, Metal and Utilities stocks. Sentiments remained up-beat with India's executive director at International Monetary Fund (IMF) Krishnamurthy Venkata Subramanian stating that Indian economy can grow at 8 per cent till 2047, if the country can redouble the good policies that it has implemented over the last 10 years and accelerate reforms. Some support also came with provisional data from the NSE showing that foreign institutional investors (FIIs) net bought shares worth Rs 188.31 crore on March 28. Additional support came with domestic rating agency Care Ratings’ report that the gross non-performing assets (GNPAs) of the Indian banking system are set to improve further to up to 2.1 per cent by the end of FY25. It mentioned GNPAs are likely to come at 2.5-2.7 per cent in FY24 and will improve further to 2.1-2.4 per cent by the end of FY25. On the global front, Asian markets are trading mixed amid a highly anticipated report on personal income and spending released on Friday showed U.S. consumer prices increased by slightly less than expected in February. Consumer prices rose by 0.3 percent in the month after climbing by an upwardly revised 0.4 percent in January. 

The BSE Sensex is currently trading at 74167.66, up by 516.31 points or 0.70% after trading in a range of 73943.15 and 74254.62. There were 25 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.32%, while Small cap index was up by 2.13%.

The top gaining sectoral indices on the BSE were Realty up by 3.72%, Metal up by 2.61%, Utilities up by 2.20%, Basic Materials up by 2.11% and Industrials up by 1.79%, while there were no losing sectoral indices on the BSE. 

The top gainers on the Sensex were JSW Steel up by 4.80%, Tata Steel up by 2.76%, Mahindra & Mahindra up by 1.64%, Larsen & Toubro up by 1.64% and HCL Technologies up by 1.64%. On the flip side, Titan Company down by 0.75%, Bharti Airtel down by 0.41%, Nestle down by 0.32% and Maruti Suzuki down by 0.06% were the top losers.

Meanwhile, Domestic rating agency Care Ratings in its latest report said that the gross non-performing assets (GNPAs) of the Indian banking system are set to improve further to up to 2.1 per cent by the end of FY25. It mentioned GNPAs are likely to come at 2.5-2.7 per cent in FY24 and will improve further to 2.1-2.4 per cent by the end of FY25. It can be noted that the Reserve Bank of India (RBI) began the comprehensive exercise in the middle of the last decade by instructing banks to classify certain stressed assets as NPAs so that the balance sheets represent a true picture. It also flagged a list of downside risks, which may result in its estimate not coming true, including a material weakening in asset quality due to the elevated interest rates, the impact of regulatory changes, a tighter liquidity environment and global issues.

It said GNPAs surged to 11.2 per cent in FY18 from 3.8 per cent in FY14 due to the AQR process of 2015-16, which pushed banks to recognise NPAs and reduce unnecessary restructuring and added that the stress was emanating from the exposure to big-ticket wholesale advances. Starting from FY19, GNPAs have been seeing an improvement and touched a decadal low of 3.9 per cent in FY23 and were at 3 per cent in the December quarter of FY24. The asset quality has improved due to recoveries, higher write-offs by banks and much lower slippages, the report said, adding that selling dud assets to asset reconstruction companies has also helped.

Besides, it stated from a sectoral perspective, the agriculture sector's GNPA ratio reduced to 7 per cent in September 2023 compared to 10.1 per cent reported in March 2020, while the industrial sector reported a 4.2 per cent GNPA ratio in September 2023 against 14.1 per cent in March 2020 and 22.8 per cent in March 2018. The industrial GNPAs were down on corporate deleveraging, resolutions, and write-offs. However, it continues to remain elevated in gems and jewellery and construction sub-sectors.

The CNX Nifty is currently trading at 22508.55, up by 181.65 points or 0.81% after trading in a range of 22443.35 and 22529.95. There were 44 stocks advancing against 6 stocks declining on the index.

The top gainers on Nifty were JSW Steel up by 5.03%, Tata Steel up by 2.79%, Apollo Hospital up by 2.54%, Adani Ports &SEZ up by 2.15% and Larsen & Toubro up by 1.96%. On the flip side, Titan Company down by 0.54%, Hero MotoCorp down by 0.40%, Bharti Airtel down by 0.29%, Nestle down by 0.29% and LTIMindtree down by 0.28% were the top losers.

Asian markets are trading mixed; Straits Times rose 20.24 points or 0.63% to 3,244.25, KOSPI increased 6.46 points or 0.24% to 2,753.09 and Shanghai Composite strengthened 31.12 points or 1.01% to 3,072.29.

On the flip side, Nikkei 225 slipped 431.86 points or 1.07% to 39,937.58, Taiwan Weighted lost 46.87 points or 0.23% to 20,247.58 and Jakarta Composite plunged 115.75 points or 1.59% to 7,173.06.