The headline equity indices ended with decent gains after a volatile session on Monday. The Nifty closed around the 17,650 level after hitting the day's low of 17,405.55 in mid-afternoon trade. IT, PSU bank and consumer durables scrips were in demand. On the flip side, oil & gas, FMCG and media shares declined.
As per provisional closing data, the barometer index, the S&P BSE Sensex advanced 169.51 points or 0.29% to 59,500.41. The Nifty 50 index added 44.60 points or 0.25% to 17,648.95.
The broader market underperformed the frontline indices. The S&P BSE Mid-Cap index fell 0.22% while the S&P BSE Small-Cap index declined 0.10%.
The market breadth was negative. On the BSE, 1,566 shares rose and 2,035 shares fell. A total of 162 shares were unchanged.
The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, rose 2.25% to 17.71.
Investors turned cautious ahead of the U.S. Federal Reserve meeting that begins Tuesday, post which the US FOMC will announce its latest interest rate decision. Further, the Union Budget 2023, to be presented on February 1, will keep the market buzzing throughout this week.
Adani Group stocks mixed after clarification:
Stocks of the nine listed Adani Group companies displayed a mixed trend after Adani Group issued a detailed riposte on Sunday (29 January) to a Hindenburg Research report that sparked sharp selloff in its stocks.
Adani Enterprises (up 3.87%), Ambuja Cements (up 1.50%) and ACC (up 1.44%) rose.
Adani Ports and Special Economic Zone (down 0.29%), Adani Transmission (down 15.06%), Adani Wilmar (down 5%), Adani Power (down 5%), Adani Total Gas (down 20%), Adani Green Energy (down 20%) slumped.
Last week, US-based Hindenburg Research LLC said it shorted Adani Group companies due to brazen market manipulation and accounting fraud. Hindenburg, an US-based investment research firm that specializes in activist short-selling, made wide-ranging allegations of corporate malpractice following a two-year investigation into the Adani group companies.
"We hold short positions in Adani Group Companies through U.S.-traded bonds and non-Indian-traded derivatives, along with other non-Indian-traded reference securities," Hindenburg disclosed in its research report published on 24 January 2023.
Adani Group stocks tanked on Friday, 27 January 2023, as the Hindenburg report spooked traders.
The conglomerate led by Asia's richest man, the Indian billionaire Gautam Adani, on Sunday (29 January) published a 413-page rebuttal to a short seller's allegations. The Adani Group said some 65 of the 88 questions raised by Hindenburg Research have already been addressed in public disclosures and called the US firm's conduct "nothing short of a calculated securities fraud under applicable law." It also repeated a threat of legal action.
"All transactions entered into by us with entities who qualify as 'related parties' under Indian laws and accounting standards have been duly disclosed by us," Adani said in its response.
"This is rife with conflict of interest and intended only to create a false market in securities to enable Hindenburg, an admitted short seller, to book massive financial gain through wrongful means at the cost of countless investors," it added.
The research report, Adani said, made "misleading claims around offshore entities" without any evidence whatsoever.
Hindenburg has not published this report for any altruistic reasons but purely out of selfish motives and in flagrant breach of applicable securities and foreign exchange laws," it said. "The report is neither 'independent' nor 'objective' nor 'well researched'."
In response to the Adani Group's rebuttal, Hindenburg Research on 29 January 2023 said that the Adani Group has failed to specifically answer 62 out of the 88 questions that the firm had posed to the group. "Adani's response largely confirmed our findings and ignored our key questions," it said.
"In terms of substance, Adani's '413 page' response only included about 30 pages focused on issues related to our report. The remainder of the response consisted of 330 pages of court records, along with 53 pages of high-level financials, general information, and details on irrelevant corporate initiatives, such as how it encourages female entrepreneurship and the production of safe vegetables," Hindenburg added.
Meanwhile, Adani Enterprise pushed ahead with its planned Rs 20,000 crore follow-on public offer. The FPO, which opened on 27 January, will conclude on 31 January. As on 15:27 IST on Monday (30 January), the issue received bids for 9,12,280 equity shares against the issue size of 4,55,06,791 equity shares. The FPO was subscribed 0.02 times.
Buzzing Index:
The Nifty IT index rose 1.10% to 30,094.85. The index lost 1.82% in two trading sessions.
Coforge (up 2.89%), Mphasis (up 2.13%), HCL Technologies (up 1.74%), LTI Mindtree (up 1.39%) and Infosys (up 1.26%), Wipro (up 1.14%), Persistent Systems (up 0.77%), Tata Consultancy Services (up 0.68%), Tech Mahindra (up 0.61%) and L&T Technology Services (up 0.12%) edged higher.
Stocks in Spotlight:
Bajaj Finserv advanced 2.35%. The company reported 41.9% jump in consolidated net profit to Rs 1,782.02 crore on a 23.47% increase in total income to Rs 21,755.35 crore in Q3 FY23 over Q3 FY22.
Bajaj Finance rallied 4.67% after the NFBC's consolidated net profit surged 39.89% to Rs 2,973 crore on 26.31% jump in total income to Rs 10,785.95 crore in Q3 FY23 over Q3 FY22.
NTPC rose 1.86% after the state-run power major's consolidated net profit rose 6.18% to Rs 4,776.61 crore on 33.97% jump in revenue from operations to Rs 44,601.84 crore in Q3 FY23 over Q3 FY22.
Vedanta added 0.64%. On consolidated basis, the mining company's net profit declined 42.25% to Rs 3,092 crore in Q3 FY23 from Rs 5,354 crore posted in Q3 FY22. Revenue from operations fell marginally to Rs 33,691 crore in Q3 FY23 as against Rs 33,697 crore reported in the corresponding quarter last year.
Bharat Electronics (BEL) tumbled 5.36%. BEL reported 2.64% rise in standalone net profit to Rs 598.77 crore in Q3 FY23 as against Rs 583.37 crore in Q3 FY22. The PSU company's net sales increased 10.6% to Rs 4,046.11 crore for the quarter ended 31 December 2022 compared with Rs 3,656.22 crore in the same quarter a year ago.
GAIL (India) slipped 4.19% after the company's consolidated net profit slumped 89.06% to Rs 413.71 crore in Q3 FY23 from Rs 3,780.78 crore in Q3 FY22. However, net revenue from operations during the quarter rose by 37.25% YoY to Rs 35,884.51 crore in the quarter ended 31 December 2022.
Kajaria Ceramics fell 3.65% after the company's consolidated net profit tumbled 39.09% to Rs 74.32 crore in Q3 FY23 as against Rs 122.02 crore in Q3 FY22. Revenue from Operations was at Rs 1,091.13 crore in the quarter ended 31 December 2022, up 2.14% from Rs 1,068.23 crore reported in the same period last year.
CARE Ratings declined 2.48%. The company reported 44% rise in standalone net profit to Rs 21.40 crore on an 18% rise in total income to Rs 65.68 crore in Q3 FY23 over Q3 FY22. Operating profit rose by 49% to Rs. 22.25 crore in the third quarter from Rs. 14.93 crore in the same period last year. The board of directors have declared an interim dividend of Rs 10 per share for the third quarter of FY23.
Aarti Drugs rose 0.18% after the pharmaceutical company's consolidated net profit tumbled 37.1% to Rs 36.69 crore in Q3 FY23 as against Rs 58.29 crore posted in Q3 FY22. Net sales stood at Rs 663.96 crore in the quarter ended 31 December 2022, up 4.6% from Rs 634.80 crore reported in the corresponding quarter previous year.
Hi-Tech Pipes jumped 5.63% after the company's consolidated net profit zoomed 199.65% to Rs 13.02 crore in Q3 FY23 as against Rs 4.34 crore posted in Q3 FY22. Revenue from operations declined 4.89% YoY to Rs 569.28 crore in the quarter ended 31 December 2022.
Five-Star Business Finance rallied 3.72%. The NBFC reported 28% rise in net profit to Rs 151 crore on a 22% increase in total income to Rs 388.7 crore in Q3 FY23 over Q3 FY22. Net Interest Income (NII) for the period under review was Rs 325.6 crore, up 33% YoY. Net Interest Margin was 13.79% in Q3 FY23 as compared with 13.46% in Q3 FY22.
Global Markets:
The Dow Jones futures were down 179 points, indicating a negative opening in the US stock market today.
Markets in Europe declined across the board while Asian stocks traded mixed on Monday as investors focus on the next U.S. Federal Reserve meeting that begins Tuesday.
The two-day meeting will conclude with the central bank's Federal Open Market Committee announcing its latest interest rate decision.
The Fed is expected to hike rates by one-quarter of a percentage point. Investors will be looking for clues about how much higher the central bank will take rates in the fight against inflation.
US stocks ended higher on Friday, fueled by gains in Tesla shares and a better-than-expected GDP report on Thursday.
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