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Informist, Wednesday, Apr. 23, 2025

By Akash Mandal

MUMBAI – Benchmark Indices are expected to remain in a thin range Thursday, but there might be profit booking ahead of the weekly expiry of derivatives contracts of the Nifty 50, analysts said. With Thursday being a heavy day on the earnings front as five Nifty 50 constituents are set to report their March quarter results, market direction over the next couple of days may depend on stock-specific movements.

Thursday, the market will consolidate and gains will be capped by profit-taking as the Nifty 50 tests higher levels, Jatin Gedia, technical research analyst at Mirae Asset Sharekhan, said. "We might see some profit booking either before or immediately after weekly expiry...the levels currently are good for booking some profit," Gedia said. Analysts pegged the support for the 50-stock index at 24100-24050 and resistance at 24450-24500.

On Wednesday, the Nifty 50 ended at 24328.95 points, up 161.70 points, or 0.7%. The BSE Sensex closed at 80116.49 points, up 520.90 points, or 0.7%. Banking and financial services stocks took a breather after several days of gains. These were the biggest drag on the Nifty 50. At the same time, information technology stocks rose, contributing to most of the gains in the Nifty 50.

After the Nifty Bank's six-session winning run came to a halt Wednesday, the index might see more profit booking ahead of the weekly expiry, Kshitija Salvi, technical analyst at IDBI Capital Markets & Securities, said. "...the index has moved sharply and is now positioned far from the value of short-term moving averages. Following the monthly expiry, a profit booking of around 1000 points is likely. The overall bias remains cautious," Salvi said.

While concerns regarding tariffs have cooled off, local geopolitics and political developments may hurt sentiment in the near term, especially after the terrorist attack in Jammu and Kashmir Tuesday, Alok Churiwala, managing director at Churiwala Securities, said. The attack was in the Pahalgam region and killed at least 26 people and left several others injured. "We cannot follow global markets blindly...local events will also be important, Churiwala said.

On the earnings front, shares of Tata Consumer Products will be in focus after the company reported a consolidated net profit of INR 3.45 billion for the March quarter, beating analysts estimates of INR 3.11 billion. While the company reported a 59% on-year rise in its bottom line, its margins shrunk by 250 basis points on year to 13.6%. LTIMindtree will also be in focus after the company's consolidated net profit rose 4% sequentially to INR 11.29 billion, but fell short of analysts' expectations of INR 11.55 billion.

Five companies which are a part of the Nifty 50 will report their earnings Thursday--Hindustan Unilever, Nestle India, Tech Mahindra, SBI Life Insurance Co., and Axis Bank. Hindustan Unilever's top line for the March quarter is expected to contract 1% on year due to sluggish demand in urban areas, which will not be fully offset by a recovery in rural demand. The company's bottom line is expected to rise 3% during the quarter. Another fast-moving consumer goods major, Nestle India, is also expected to report sluggish earnings for the March quarter due to poor demand and high input costs. The net profit is expected to be INR 8.70 billion for the March quarter, down 7% on year, as per the average of 13 analyst estimates. Its revenue is seen rising 4%.

Technology major Tech Mahindra is likely to report a consolidated net profit of INR 10.63 billion, up 8% sequentially, according to the average of the estimates of 20 brokerage firms. The consolidated revenue is estimated at INR 134.36 billion, up only 1.1% on quarter. These muted numbers are due to weakness in the hi-tech industry and low demand in the business process outsourcing segment.

Axis Bank may buck the trend of strong earnings by banks so far in the quarter, as the private  lender is expected to report a 6% on-year fall in net profit to INR 67.13 billion, according to estimates from 17 brokerages. Adani Energy Solutions, Macrotech Developers, ACC, SBI Cards and Payment Services, Supreme Industries, Mphasis, and Persistent Systems are some of the other major companies which will report their earnings for the quarter.  End

Edited by Deepshikha Bhardwaj

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