Six more trading sessions to go before the market starts looking for a fresh set of triggers. Smart money may be already looking beyond the elections. In a report last week, Morgan Stanley said that it likes India in the emerging markets space alongside Korea and Taiwan, but did not mention election results. “We continue to focus on strength in earnings growth over the forecast horizon in India,” said a line in the report.
In its GREED and Fear newsletter, broking firm Jefferies mentioned that domestic fund managers are worried that a revision in capital gains tax (for the worse) may be coming.
A Bloomberg report last week said that a large number of algo trading firms were loading up on options trades betting that the market was likely to move in a narrow range post-election results. This is in stark contrast to the expectations among a large section of small investors and high net-worth individuals that the market could either surge (if the BJP did better than expected) or crash (if the BJP fared poorly) after the election results are out.
What is better-than-expected or less-than-expected is a big question mark. The market is convinced that a 400-seat win for the NDA is highly improbable. As is the likelihood of a shock defeat for the BJP. What makes it difficult to predict the market reaction to the poll verdict is that there is a section of smart investors who feel that a small majority for the NDA is also a good outcome for the market, because a stronger mandate could create its own set of problems.
Interglobe Aviation (Rs 4251,-3.4%)
The stock fell despite announcing a strong set of Q4 earnings
Bull argument: Dominant share in the domestic market and stable crude prices. The carrier is working to increase its international presence through strategic partnerships and loyalty programs, according to broking firm MOSL.
Bear argument: Weak guidance for Q1FY25 has raised concerns, according to analysts at InCred Equities. While net profit gained year-on-year, it declined sequentially.
Bikaji Foods (Rs 552.9, 3.4%)
Bikaji Foods reported a 3x jump in net profit at Rs 116.3 crore
Bull view - The company is moving into newer geographies like Uttar Pradesh, Punjab, Haryana, and Delhi and trying to gain market share there. The company has strategically established its manufacturing units so it can target specific geographies, says Vikrant Kashyap of BOB Capital.
Bear argument: If Blackstone buys a majority stake in Haldirams it could impact Bikaji Foods' business by way of higher competitive intensity.
0 Comment