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Informist, Monday, Apr. 21, 2025

By Akash Mandal

MUMBAI – Benchmark indices ended sharply higher Monday, extending gains for the fifth straight session. The gains were led by banks and information technology stocks. Shares of heavyweights ICICI Bank and HDFC Bank rose after they reported robust earnings for the March quarter. Shares information technology stocks rose after the management of Infosys said it did not see any major change in discretionary spending. This lifted IT stocks as many of them had fallen on concerns over US tariffs denting spending on IT.

The Nifty 50 closed at 24125.55 points, up 273.90 points or 1.2%, and the BSE Sensex ended at 79408.50 points, up 855.30 points or 1.1%. The indices ended at their highest levels since Jan. 2. They have gained around 8% in the past five sessions. Broader market indices outperformed the benchmarks, with small- and mid-cap indices closing 2.0-2.5% higher.

HDFC Bank ended 1% higher after several brokerages raised their target prices on the stock by 7-13% after the Jan-Mar results, while maintaining a 'buy' rating on improved asset quality and higher net interest margins. The bank's bottom line for the March quarter was up nearly 7% on year at INR 176.16 billion, beating analysts' estimates of INR 171.07 billion. The stock was the top contributor to the Nifty 50's rise.

Infosys rose over 2% despite several brokerages cutting the target price on the stock after the March quarter earnings. The company has guided for revenue growth of 0-3% in constant currency terms for 2025-26 (Apr-Mar), which "exudes management confidence in trying to mitigate the weak macro", Nuvama Institutional Equities said. Other IT stocks also gained, with Tech Mahindra, Coforge, and Mphasis ending around 5% higher.

Alongside HDFC Bank, other banking and financial services stocks also gained and the Nifty Bank ended at a fresh closing high of 55304.50 points, up nearly 2%. "Investors are positive on the banking and financial services sector as it provides them protection from the uncertainty around tariffs," said Bunty Chawla, assistant vice-president of banking, financial services, and insurance at IDBI Capital Markets & Securities. The gains seen in the sector in recent times may also be due to foreign investors resuming their purchases of bank stocks.

"Historically, FIIs have loved the banking sector due to protection from uncertainty...they will slowly rebuild their positions in private banks now (after heavy FII-led selloff last month). The financial sector is thus better-off than other sectors," Chawla said. Earnings of companies in the sector have also been robust, which has also boosted sentiment, he said.

Barring Nifty FMCG, all other sectoral indices ended in the green. The Nifty PSU Bank index ended over 2% higher and was the top gainer among all the sectoral indices.

Shares oil and gas companies also ended higher, with heavyweight Reliance Industries gaining around 2%, as prices of crude oil fell sharply. GAIL (India), Petronet LNG, and Indian Oil Corp. ended higher by 3-5%. at 1549 IST, Brent crude oil futures traded nearly 3% lower at $66.08 per barrel as talks between the US and Iran over a nuclear deal showed progress, which raised hopes that crude oil from Iran could return to global markets, leading to higher supply.

Nifty FMCG index ended 1% lower, snapping a six-session winning run during which the index had gained over 6%. "Among domestic facing sectors, sectors like defence and railways are preferred to FMCG as there is no pickup in demand visible...demand will recover in the next 2-3 quarters, till then its wait-and-watch (for Nifty FMCG)," Prashanth Tapse, senior vice-president of research at Mehta Equities, said.

Several stocks reacted to their March quarter earnings. Just Dial ended 11.5% higher and was the top gainer in the Nifty 500 after the company reported better-than-expected net profit for the March quarter with its bottom line rising 20% sequentially to INR 1.58 billion. International Gemmological Institute (India) gained 4.5% after its net profit for the March quarter rose 11% on year to INR 1.39 billion and sales rose 12% to INR 2.34 billion.

Tata Elxsi rose 9% after the company announced robust deal wins for the March quarter even though earnings for the quarter were muted. The company reported a net profit of INR 1.72 billion, down 13.4% sequentially and missed analysts' estimates of INR 1.79 billion.

Among other stocks, Muthoot Finance extended intraday gains and ended 4% higher after the company's board approved an interim dividend of INR 26 per equity share for 2024-25 (Apr-Mar). Wind turbine makers Suzlon Energy and Inox Wind rose around 9% and 3%, respectively, after the ministry of new and renewable energy released a new draft notification for revised list of models and manufacturers for wind turbine models, as reported by CNBC-TV18. This new draft notification mandates local sourcing of key components used in the manufacturing of wind turbines.

Shares of Vodafone Idea closed over 10% higher after the company cleared dues worth INR 5 billion to Indus Towers, raising hopes that the telecom company may be in a better position to clear debts, an analyst at a Mumbai-based brokerage said.

On the other hand, Adani Ports and Special Economic Zone ended more than 1% lower and was the worst-hit in the Nifty 500. An analyst said the company's deal to acquire Abbot Point Port Holdings Pte. from Carmichael Rail and Port Singapore Holdings was slightly expensive. After market hours on Thursday, Adani Ports had said it will buy Abbot Point Port Holdings for over INR 26 billion from Carmichael Rail and Port Singapore Holdings.

* Of the Nifty 50 stocks, 39 rose and 11 fell

* Of the Sensex stocks, 23 rose and 7 fell

* On the NSE, 2,251 stocks rose, 683 fell, and 80 were unchanged

* On the BSE, 1,689 stocks rose, 783 fell, and 124 were unchanged

* Nifty PSU Bank: up 2.5%; Nifty Oil & Gas: up 2.4%; Nifty FMCG: down 1%

BSE                                               NSE

Sensex: 79408.50, up 855.30 points or 1.1%        Nifty 50: 24125.55, up 273.90 points or 1.2%

End

US$1 = INR 85.36

Edited by Ashish Shirke

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