Sensex, Nifty Recover from Day's Low to End Marginally Higher; Divi's Lab & Tata Motors Top Gainers

Mon, 14 Jun Closing | Nandini Mehta, TM Team

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Indian share markets recouped early losses during afternoon deals and ended today's volatile session higher.

Benchmark indices bounced back from early losses and ended on a positive note today, tracking firm cues from global markets.

At the closing bell, the BSE Sensex stood higher by 77 points (up 0.2%).

Meanwhile, the NSE Nifty closed higher by 13 points (up 0.1%).

Divi's Lab and Tata Motors were among the top gainers today.

Adani Ports and Coal India, on the other hand, were among the top losers today.

The SGX Nifty was trading at 15,831, up by 9 points, at the time of writing.

The BSE Mid Cap index and the BSE Small Cap index ended down by 0.4% and 0.3%, respectively.

Sectoral indices ended on a mixed note with stocks in the energy sector and IT sector witnessing most of the buying interest.

Power stocks, on the other hand, witnessed selling pressure.

Shares of Lux Industries and Godrej Consumer hit their respective 52-week highs today.

Asian stock markets ended on a mixed note today in holiday-thinned trading as investors prepared for a key Federal Reserve meeting later in the week.

While most Asian markets were closed, Japan's Nikkei ended up by 0.7% in today's session.

US stock futures are trading on a flat note today with the Dow Futures trading up by 31 points.

The rupee is trading at 73.27 against the US$.

Gold prices for the latest contract on MCX are trading down by 1% at Rs 48,432 per 10 grams.

Speaking of the stock markets, Brijesh Bhatia, Research Analyst at Fast Profits Report shares how you can profit from the next leg of the metals rally, in his latest video for Fast Profits Daily.

Tune in to the video below to find out more:

In news from the engineering sector, BHEL was among the top buzzing stocks today.

Shares of Bharat Heavy Electricals (BHEL) slipped 18% to Rs 62.6 apiece on the BSE in intra-day trade today after the company reported a lower-than-expected set of numbers for the quarter ended March 2021.

In the fourth quarter of 2021, BHEL reported a net loss of Rs 10.4 bn against a loss of Rs 15.3 bn in the year-ago quarter.

During the full financial year 2020-21, the company's consolidated net loss widened to Rs 27 bn as compared with Rs 14.7 bn in the last year.

Revenues grew 42% year-on-year (YoY) at Rs 71.7 bn on a low base, with some impact of execution headwinds and pandemic.

It was Rs 50.2 bn in the same period last year.

For the full year 2021, the company's revenue from operations stood at Rs 173.1 bn, down 19% compared to Rs 214.6 bn in the previous year.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) level loss came in at Rs 12.6 bn against a loss of Rs 5.6 bn in the same quarter a year ago owing to lower-than-expected execution and higher-than-expected operating expenses.

In a statement the company said, the nationwide lockdown, consequent to the spread of the Covid-19 pandemic globally, caused disturbance and slowdown in the economic activities.

It impacted the group operations during 2020-21, which recouped progressively.

Based on internal and external information up to the date of approval of these financial statements, the company expects to recover the carrying amount of its assets, investments, trade receivables, contract assets and inventories, it added.

BHEL share price ended the day down by 11.6% on the BSE.

Speaking of the capital goods sector, here's an interesting data point:

Had you instead invested in the BSE Capital Goods index in 2002, you would have made a return of over 3,000% - a whopping 83% CAGR (compound annual growth rate) - over the next six years.

Here's what Aditya Vora, Financial Writer at Equitymaster, wrote about the capital goods sector in one of the editions of Profit Hunter:

• I'm a firm proponent of the economic revival theme in the stock market. I'm bullish on capital goods and infrastructure stocks.
  
  These sectors have emerged stronger from an elongated down cycle. There is also a strong momentum in economic indicators which is in favour of these stocks.
  
  Indicators like rising construction equipment sales, record highway construction run rate, capacity expansion by private players in the cement, metals, and consumer durables gives us confidence of a strong capex cycle ahead.
  
  There may be a near term speed bump to the economic recovery due to the rising covid cases and lockdowns. However, I believe we are at an inflection point with regards to the capex cycle.
  
  The cycle has turned up.

The recent Hidden Treasure recommendation is a fundamentally strong business in the capital goods space that is 'essential' to the infrastructure revival.

You can read the report here. (requires subscription)

If you're not a subscriber, here's where you can sign up.

BREAKING: It's Good Time to Invest in Gold, but Just Don't Go Blindfolded

Moving on to news from the auto ancillaries sector...

Amara Raja Batteries Announces Energy and Mobility Playbook

Amara Raja Batteries (ARBL) announced energy and mobility as its strategic focus going forward to capitalise on emerging opportunities.

It announced expansion of lead acid batteries business and establishment of a new energy strategic business unit encompassing lithium cell and battery pack, EV chargers, energy storage systems, advanced home energy solutions and related products and services.

This move by Amara Raja Batteries comes against the backdrop of some of India's top conglomerates, renewable energy firms and battery makers seeking to take advantage of the government's Rs 181 bn production linked incentive (PLI) scheme to make lithium-ion cells.

Through the scheme, the government is looking to attract investments worth Rs 450 bn.

The ACC (advanced chemistry cell) PLI scheme announced recently by government of India provides a significant impetus for building a domestic supply chain for lithium and other advanced cell chemistries to serve the fast-growing electric vehicle (EV) and renewable energy sectors.

The lead acid battery major, among other companies such as BHEL, Exide Industries, Greenko Group, Renew Power, Reliance Industries, Adani Group, Tata Chemicals, Larsen & Toubro, and a joint venture (JV) led by Japan's Suzuki Motor Corp. have shown interest in building lithium-ion cell manufacturing plants in India.

How this pans out remains to be seen. Meanwhile, we will keep you updated on the latest news from this space.

Amara Raja Batteries share price ended the day up by 1.9% on the BSE.

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