Everyone’s given up on the market, it appears after interacting with so many people in last few days.
Everyone seemed to be agreeing that we are in the bear market & even high interest rates will lead world to recession.
Plus, govt steps in last few days to contain inflation has made things worse – no one bothers to understand the impact or not – but everyone is painting everything with same brush – red colour. Classic signs of a bottom formation soon hopefully.
Yesterday, clearly panic was not due to FIIs selling – as DIIs bought more than FIIs in cash market. VIX did not see rise yesterday which was good. But it was retailers and HNIs who sold in panic & how they sold – ruthless in some stocks.
But, after a long time I saw delivery picking up in the cash market – Balrampur nearly 35 lakh shares delivery in last 2 days… nearly 125 cr delivery. Mindtree, Mphasis, Ashok Leyland, InfoEdge, BoB all saw delivery value above 100 crore yesterday. Are smart hands coming back to buy selectively? Looks like.
Globus Spirits was classic case yesterday. Stock Analysiswent down 20%. EBITDA margins came at 17.6% vs expected 18-19% due to significant rise in broken rice price and power costs and lower IMIL revenue share in overall mix. Concall was fine and management reiterated that capacity expansion plans remain on track to 1325KLPD (40cr ltrs) from 665KLPD now (20cr ltrs). Cost escalation in part of business and they are sourcing from FCI as well to reduce cost. Even if you have to be very conservative – with new capacity & Q4 gross margins - revenue would grow from 1579crs in FY22 to 1919/2273crs in FY23e/FY24e, EBITDA from 329crs in FY22 to 408crs in FY24 and PAT from 187crs to 260crs – so stock is at 10x TTM PE.
There are many chances of surprise in earnings on the upside which let us not even consider.
Yday delivery in Globus was highest ever in almost a year or so.
There can be many case studies like these – where irrational dumping happening with no focus on earnings.
Nifty 50, 100 - The importance of 15980
We are giving a lot of importance to the 15980 number in the recent morning updates. This has a lot of logic to it. There are a number of historic pivot point hits around this number. This makes it an important inflection level. For the bears to take over Nifty will have to break the same on a closing basis. Once confirmed, the bulls just don’t have a chance.