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Informist, Friday, Jan. 31, 2025

By Akash Mandal

MUMBAI – Benchmark indices ended higher Friday, extending their winning streak for the fourth straight session. The gains in the Nifty 50 were led by index-heavyweights such as Larsen & Toubro, Reliance Industries, and Infosys. Major fast-moving consumer goods stocks also ended with strong gains, with shares of Nestle India and Tata Consumer Products soaring on account of a positive outlook amid tepid demand, an analyst said. The rise was despite their bottom line for the December quarter missing the Streets' view. 

The Nifty 50 ended at 23508.40 points, up 258.90 points or 1.1%, and the BSE Sensex closed at 77500.57 points, up 740.76 points or 1%. The Nifty 50 closed above 23500 points after three weeks. Jatin Gedia, technical research analyst at Mirae Asset Sharekhan, attributed the rise in headline indices to investors covering their short positions across various sectors. Broader market indices outperformed benchmark indices, with the Nifty Smallcap and Nifty Midcap indices rising around 2% each. 

Large-cap FMCG stocks rose, despite big players such as Tata Consumer Products and Nestle India's bottom line growing in the mid-single digits, and falling short of analysts' expectations. However, Tata Consumer Products' management, in a post-earnings call Thursday, said it was hopeful that the pressure on its margins on account of high tea prices will ease over the next couple of quarters. Nestle India's lukewarm performance was on account of slowing urban consumption. 

FMCG companies were already expected to report a slowdown in their earnings for the December quarter, and the earnings are not a surprise, an analyst tracking the sector at a domestic brokerage said. However, these companies still managed to grow their topline and bottomline during the quarter, which was a positive, the analyst said. Nestle India and Tata Consumer Products ended nearly 4% and 6% higher, respectively, and were among the top performers in the Nifty 50. 

Following their quarterly results, shares of L&T closed more than 4% higher after the company's management said it expected to surpass the 10% order inflow growth guidance for 2024-25 (Apr-Mar), which would be supported by order inflow and pipeline. The market cheered this, despite the company's December quarter consolidated net profit of INR 33.59 billion falling short of the Street's view of INR 36.72 billion. 

IndusInd Bank's stock gained 3.7% after the bank's December quarter net profit came in above analysts' expectations. Bharat Electronics gained 5%, rising for the third consecutive session after its earnings, announced during market hours Thursday, comfortably beat estimates. The stock has gained over 13% over that period. 

UPL closed 6.5% higher at a 15-month high after the company posted a consolidated net profit after three consecutive quarters of losses, which also beat analysts' estimates by a wide margin, supported by recovery in volumes and pricing. Shares of IRB Infrastructure Developers ended nearly 7% higher ahead of its earnings due later in the day. 

All sectoral indices also ended in the green. Nifty Consumer Durables was among the top sectoral gainers, after ending Thursday as the worst hit in the pack. The rise in the index was led by Kalyan Jewellers, which soared more than 14% after its top line and bottom line for the December quarter rose 40% and 21%, respectively. Nifty Realty ended up for the fourth straight session, rising around 9% in that period. 

As investors shifted their focus to the Union Budget scheduled for Saturday; energy, defence, and capital goods stocks gained. These industries are closely tied to the government spending. Defence stocks such as Mazagon Dock Shipbuilders and Hindustan Aeronautics closed around 5% higher each. Nifty Energy was the top performer among the sectoral indices, with all 40 constituents ending higher. 

On other hand, Jindal Steel & Power fell almost 6% after its consolidated net profit for the quarter halved on year. Analysts said they expect the company to face headwinds in the near term after it increased its guidance for capital expenditure and delayed its capacity extension goal for crude steel. Whirlpool of India was down around 10% and was the worst hit on the Nifty 500 for the second straight session. On Thursday, the company had said its parent, Whirlpool Corp., planned to sell a 31% stake in the company by mid-2025 or later in the calendar year through market sales. 

* Of the Nifty 50 stocks, 43 rose and 7 fell

* Of the Sensex stocks, 24 rose and 6 fell

* On the NSE, 2,130 stocks rose, 711 fell, and 78 were unchanged

* On the BSE, 2,719 stocks rose, 1,203 fell, and 125 were unchanged

* Nifty Energy: up 2.6%; Nifty Consumer Durables: up 2.4%; Nifty Pharma: down 0.1%

BSE                                                 NSE

77500.57 points, up 740.76 points or 0.97%          23508.40 points, up 258.90 points or 1.11%

End

Edited by Akul Nishant Akhoury

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