Almost every index heavyweight, be it Reliance Industries, Infosys, TCS, ITC put their hand up on Friday to take the Nifty to a new record high of 24,861. The index began the August F&O series with a 400-point surge, something it gained through an entire series in July. And unlike previous instances, the index has also managed to end close to the day’s high, which will give the bulls some comfort.
While IT and Reliance have been contributors through and through, what further aided Friday’s move was a recovery in banks. The Nifty Bank index recovered nearly 900 points from the lows of the day and barring HDFC Bank, most of the index constituents contributed to the rally on the upside. Infosys, trading at the highest level in two years, is also nearing a record high.
August has historically been a good series for the Nifty as barring a 400-point drop last year, the index gained nearly 600 points in 2022 and an even better 850 points in 2021. With Friday’s move, the index is now within 165 points of scaling the 25,000 mark. In case that does happen on Monday, it would have taken the index 21 sessions from June 27, which is when it had crossed the mark of 24,000, to scale another 1,000 points.
A slew of earnings reactions will be seen during Monday’s trading session. Stocks like IndusInd Bank, Bandhan bank, Power Grid, KEC International, Kaynes Tech among others will react to results reported after market hours on Friday. But the reaction to ICICI Bank, who reported results on Saturday, will be the key in determining whether the Nifty manages to scale the 25,000 mark or not. Besides ICICI Bank, stocks like PNB, Anant Raj, MCX, Spandana Sphoorty, Dr Reddy’s Laboratories, Genus Power, among others will also react to results.
Monday’s session will see stocks like ACC, BEL, Adani Total Gas, CSB Bankk, Data Patterns, HPCL, Kansai Nerolac, Strides Pharma, Kalpataru projects etc. reporting results.
Both foreign and domestic institutions were net buyers in the cash market on Friday. The numbers may also be skewed due to the block deal that took place in Sobha on Friday morning.
Amol Athawale expects 25,000 to be a key hurdle for the bulls but crossing that can take the Nifty to 25,150 levels. 24,675 – 24,600 on the downside now becomes an important support, below which, the sentiment could change.
Angel One’s Rajesh Bhosale says that momentum indicators are still in overbought territory and advises avoiding complacency. He sees support on the downside at 24,600, while 25,000 on the downside will be the first barrier. In case, the Nifty does cross 25,000, it can lead to upside levels of 25,340.
The short term trend of the Nifty turns positive with the next upside level seen between 25,000 – 25,100, said Nagaraj Shetti of HDFC Securities. Immediate support on the downside is at 24,650.
As we highlighted earlier, the recovery in the Nifty Bank also contributed to the Nifty hitting a record high on Friday. ICICI Bank’s will be a key reaction to monitor and that will be the key determinant of how the Nifty Bank moves on Monday. The index also closed back above the 51,200 mark and will have its sights on scaling the 51,500 mark on Monday, which has been a key resistance in recent times.
The Nifty Bank has formed a bullish belt hold pattern on the daily charts and closed above 51,100 on a weekly basis, signalling strength, said Hrishikesh Yedve of Asit C Mehta Investment Interrmediates. In the short-term, 51,800 – 52,000 will be the key resistance levels for the index.
Om Mehra of SAMCO Securities said that the Nifty Bank rebounded from lower levels, maintaining its position above the mark of 50,000 and above the 50-Day Moving Average. Support on the downside remains at 50,900 and any correction towards 51,000 could be a buying opportunity for the 51,800 – 51,900 target on the upside.
What Are the F&O Cues Indicating?
These stocks added fresh long positions on Friday, meaning an increase in both price and Open Interest:
| Stock | Price Change | OI Change |
| India Cements | 3.01% | 40.33% |
| Apollo Tyres | 1.71% | 28.86% |
| Manappuram Finance | 4.16% | 16.10% |
| TVS Motor | 2.55% | 13.30% |
| Escorts Kubota | 1.73% | 9.83% |
These stocks saw fresh short positions added on Friday, meaning a decline in price but an increase in Open Interest:
| Stock | Price Change | OI Change |
| Navin Fluorine | -0.08% | 8.79% |
| ONGC | -1.01% | 4.56% |
| IDFC First Bank | -0.05% | 4.07% |
| Indian Oil | -0.28% | 2.82% |
| Federal Bank | -3.21% | 2.47% |
Short covering was seen in these stocks on Friday, meaning an increase in price but a decline in Open Interest:
| Stock | Price Change | OI Change |
| Ashok Leyland | 6.13% | -14.39% |
| Tech Mahindra | 0.46% | -12.09% |
| Syngene | 2.40% | -10.90% |
| Petronet LNG | 1.78% | -9.40% |
| JSPL | 3.57% | -8.51% |
These are the stocks to watch out for ahead of Monday’s trading session:
- ICICI Bank: Deposit growth at 15.1% year-on-year to ₹14.2 lakh crore. Advances growth up 15.7% year-on-year to ₹12.23 lakh crore. Net Interest Income up 13.1% year-on-year to ₹23,460 crore. Net profit up 10% to ₹11,696 crore. Gross NPA at 2.15% from 2.16% in March, Net NPA at 0.43% from 0.42% in March. Slippages up 15.1% sequentially to ₹5,916 crore. Watchlist down 4.4% to ₹5,286 crore. Profitions up 88.6% sequentially to ₹1,316 crore.
- UltraTech / India Cements: UltraTech Cements to acquire 28.42% stake from promoters and another 4.3% from other associates of India Cements at ₹390 per share for ₹3,954 crore. UltraTech also announces Open offer for 26% stake in India Cements at ₹390 per share. Open Offer for India Cements at a 4% premium to Friday’s closing. UltraTech had acquired a 22.7% stake in India Cements in June via block deals.
- PNB: Deposit growth of 8.5% year-on-year to ₹14.08 lakh crore. Advances growth of 14% year-on-year to ₹9.83 lakh crore. Net Interest Income up 10.2% year-on-year to ₹10,476 crore. Net profit up 159% from last year to ₹3,251 crore. Gross NPA at 4.98% from 5.73% in March. Net NPA at 0.6% from 0.73% in March. Slippages down 20.4% sequentially to ₹1,755 crore. Gross NPA guidance revised to ~4% from 5% in financial year 2025. Credit cost guidance for the year revised to below 0.5% from below 1% earlier.
- Dr. Reddy’s Laboratories: Revenue up 14% to ₹7,672.7 crore, better than estimates. EBITDA margin at 28.2%, better than estimate of 27.4% but lower than 31.7% from last year but improve sequentially. US sales up 20% year-on-year and 18% sequentially to ₹3,846.2 crore. Europe sales up 4% year-on-year but flat sequentially. India sales up 15% year-on-year and 18% sequentially to ₹1,325.2 crore. Nicotinell transaction to close in early part of Q4 2024. JV with Nestle India to become operational by Q2 FY25. To also split one share of face value of ₹5 into five shares of face value of ₹1.
- REC: Sanctions up 48.5% from last year to ₹1.12 lakh crore. Disbursals up 18.2% to ₹43,652 crore. AUM up 21.8% from last year to ₹5.29 lakh crore. Net Interest Income up 31.5% from last year to ₹4,479.2 crore. Net profit at ₹3,442.5 crore, aided by higher other income which more than doubled from last year. Provisions of ₹472.6 crore compared to provision write-back of ₹711.9 crore in March and write-back of ₹319.65 crore last year. Gross NPA at 2.61% from 2.71% last year. Net NPA at 0.82% from 0.86% last year.
- RITES: Board meet on July 31 to consider a bonus issue of shares. Had earlier announced a 1:4 bonus in 2019.
- IDFC First Bank: Deposits up 41.2% year-on-year to ₹2.09 lakh crore. Advances up 24.5% year-on-year to ₹2.02 lakh crore. Net Interest Income up 25.4% year-on-year to ₹4,694.9 crore. Net profit down 11% to ₹680.7 crore. Gross NPA at 1.9% from 1.88%. Net NPA at 0.59% from 0.6%. Retail gross NPA at 1.46% from 1.38%. Retail Net NPA at 0.46% from 0.44%. Slippages up 23% from March to ₹1,657 crore.
- KEC International: Revenue up 6.3% year-on-year to ₹4,511.9 crore. EBITDA up 10.6% to ₹270.4 crore. EBITDA margin at 6% from 5.9%. EBITDA also includes ₹24 crore received towards an arbitration award. Year-to-Date order intake at ₹7,664 crore. L1 in orders of over ₹9,500 crore. Board has approved fund raise via QIP and other methods worth up to ₹4,500 crore. It will also raise ₹1,500 crore via Non-Convertible Debentures. Approves transfer of its cables business to its subsidiary. To explore avenues of organic and inorganic growth.
- Power Grid: Revenue of ₹10,068.1 crore, lower than CNBC-TV18 poll of ₹11,278 crore. EBITDA of ₹8,744.1 crore also lower than estimate of ₹9,743.2 crore. EBITDA margin of 86.9% lower than poll of 86%. Net profit of ₹3,412.2 crore lower than estimate of ₹3,856 crore. FY25 capex fixed at ₹15,000 crore with the possibility of an upside to ₹17,000 crore. Capitalisation likely to double to between ₹15,000 crore to ₹16,000 crore.
- NTPC: Revenue up 13.5% to ₹44,419.2 crore, higher than poll of ₹42,012 crore. EBITDA up 9.5% to ₹12,466.7 crore, higher than poll of ₹11,922 crore. EBITDA margin at 28% versus poll of 28.4%. Installed capacity of NTPC group increased by 3 GW to 76 GW. Average tariff increased 3.3% to ₹4.6.
- Glenmark Life: Gujarat Pollution Control Board has asked not to carry out production activity at Ankleshwar. Sample collected from GIDC storm water drain was found to be contaminated and had high COD levels and other parameters. GPCB has asked to submit a bank guarantee worth ₹15 lakh for compliance assurance at the time of revocation. Company said this may be due to incessant rains in the entire Bharuch district. Believe that the order is subject to reconsideration.
Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.
