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Informist, Monday, Nov. 4, 2024

By Anjana Therese Antony

MUMBAI – Ahead of Titan Co.'s quarterly earnings on Tuesday, investors chose to be cautious. This was evident from its options chain, with premiums on deep out-of-the-money call options of the company falling around 25% and those on puts rising by a similar percentage. Shares of the company Monday closed 2.2% lower at INR 3,222 on the National Stock Exchange. The stock has fallen nearly 2% in the last seven days as well as in 52 weeks. 

Premiums on INR 3,250-3,900 put options of Titan expiring Nov. 28 fell 17-27% and those on INR 3,200-2,700 put options increased 34-37%. The maximum open interest addition was at INR 3,300 call and INR 2,900 put options. 

According to analysts, revival in demand for jewellery is expected to drive the Bengaluru-based company's financial growth across segments. Titan Co. is expected post 8% on-year growth in its net profit for the September quarter to 10.17 billion and revenue is seen up nearly 19% at INR 138.38 billion, according to the average of estimates from eight broking firms. Sequentially, this translates to a 32% growth in the bottom line and nearly 15% increase in top line.

Demand for jewellery remained robust after the customs duty cut as some marriage shopping was brought forward, broking firm Prabhudas Lilladher said in its earnings preview report on Titan Co. "As per our interactions, we understand there was a moderation in demand during September due to a spike in gold prices," Antique Stock Broking said in its pre-earnings report.

When it comes to the overall equity market, analysts believe it may extend losses on Tuesday on persistent selling by foreign investors and as the September quarter earnings have failed to give a positive trigger, analysts said. Also, there will be some caution ahead of the US presidential election on Tuesday. Investors will focus on whether the Democratic Party's Kamala Harris will become the first female president or the Republican Party's Donald Trump will get a second term after Joe Biden. 

On Monday, the Nifty 50 ended 1.3% lower at 23995.35 points and the BSE Sensex closed 1.2% lower at 78782.24 points. Both the indices closed below their respective psychologically important levels of 24000 points and 79000 points for the first time in three months. The near-term support for the 50-stock index is pegged at 23900-23850 points and resistance is at 24100-24150 points, according to technical and derivatives analysts at two broking firms.

Premiums on 24000-24500 call options of the Nifty 50 expiring Thursday declined 50-72% and those on 24000-23000 increased 71-86%. The maximum open interest addition was at 24000-point call option and 22450-point put option. The highest concentration of open interest was at 27000-point call and 22450-point put contracts

--Nifty 50 Nov closed at 24100.00, down 283.65 points; 104.65-point premium to spot index

--Nifty 50 Dec closed at 24247.10, down 277.95 points; 385.25-point premium to spot index

--Nifty 50 Jan closed at 24380.60, down 271.00 points; 251.75-point premium to spot index

Reliance Industries, State Bank of India, HDFC Bank, Mahindra & Mahindra, ICICI Bank, Larsen & Toubro, Infosys, Punjab National Bank, Dixon Technologies India, Bajaj Auto, Hero MotoCorp, Axis Bank, Bharti Airtel, Tata Motors, and Federal Bank were the most actively traded contracts.  End

Edited by Ashish Shirke

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