Capital Goods Stocks Outlook
Seen up next wk as govt orders likely to rise
This story was originally published at 18:11 IST on 6 December 2024
Register to read our real-time news.Informist, Friday, Nov. 6, 2024
MUMBAI – Shares of capital goods companies are expected to continue to move higher next week amid expectations of a pickup in orders from the government. However, investors may book profits in select stocks as valuations are still not at comfortable levels, analysts said.
The BSE Capital Goods index has risen over 10% in the last three weeks. Investors turned to these stocks after the landslide victory of the alliance led by the Bharatiya Janata Party in Maharashtra gave market participants confidence over policy continuity. Sentiment is also positive amid expectations that the government will begin spending significantly going ahead, which is likely to aid earnings of capital goods companies in Oct-Dec and Jan-Mar.
Finance Minister Nirmala Sitharaman on Friday expressed confidence that the pickup in economic activity in Oct-Dec due to better public expenditure will likely compensate the slowdown in growth in the first two quarters of 2024-25 (Apr-Mar). While the government capital expenditure is expected to pick up, analysts said the government is likely to miss its capex target of this financial year, considering disruptions caused by the General Election. The government's capital expenditure was at INR 4.67 trillion in Apr-Oct, down 15% from the same period a year ago.
Brokerage Elara Securities said the order inflows for defence companies are likely to increase sharply after the Defence Acquisition Council approved five capital acquisition proposals worth INR 217.72 billion earlier this week. The brokerage said defence capital outlay for this financial year so far till October was 36% of tge budgeted amount of 1.72 trillion, which it said was significantly lower than the levels seen in the past six years.
TOP HEADLINES
* RITES named project mgmt consultant by IIM Raipur for INR-1.48-bln project
* Cummins India's CFO Ajay Shriram Patil resigns with effect from Jan 9
* L&T completes acquisition of 15% stake in E2E Networks via pref allotment
* AIA Engg says US OKs 4.3% anti-dumping duty on some cast iron grinding media
* Suzlon Energy gets additional wind power order from Jindal Renewable arm
* IPO Alert: Concord Enviro gets SEBI approval for fresh issue of shares, OFS
* Ministry of Defence, Cochin Shipyard in pact for INR 12.08-bln project
* KEC International's T&D business gets orders worth INR 10.40 bln
* GST authority levies INR-1.73-bln penalty on L&T for discrepancies
Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:
| Company | Price | Week-on-week change in % | Resistance | Support |
| Bharat Heavy Electricals | 249.05 | (-)0.80 | 254.70 | 245.50 |
| CG Power and Industrial Solutions | 782.50 | 6.90 | 798.00 | 757.40 |
| Larsen & Toubro | 3866.70 | 3.80 | 3934.20 | 3766.30 |
| Siemens | 7787.60 | 3.00 | 7958.50 | 7666.70 |
| Thermax | 4655.00 | 1.40 | 4758.10 | 4588.40 |
| Bharat Electronics | 313.75 | 1.90 | 317.00 | 311.50 |
| S&P BSE Capital Goods | 72814.68 | 3.00 | 73375.80 | 72088.60 |
| Nifty 50 | 24677.80 | 2.30 | 24813.70 | 24552.60 |
| S&P BSE Sensex | 81709.12 | 2.40 | 82133.50 | 81294.00 |
End
Reported by Anshul Choudhary
Edited by Saji George Titus
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (22) 6985-4000/+91 (11) 4220-1000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2024. All rights reserved.
To read more please subscribe
Share this Story:
