Sensex Hits Record-High, Dow Futures Trade Flat

Thu, 12 Aug 12:30 pm

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Share markets in India are presently trading marginally higher.

The BSE Sensex is trading up by 242 points, up 0.4%, at 54,767 levels.

Meanwhile, the NSE Nifty is trading up by 66 points

Tech Mahindra and Power Grid Corporation are among the top gainers today. Eicher Motors and IndusInd Bank are among the top losers today.

The BSE Mid Cap index is trading up by 0.6%.

The BSE Small Cap index is trading up by 1.7%.

On the sectoral front, barring the consumer durables sector, all sectors are trading in green with stocks from the utilities sector witnessing most of the buying interest.

US stock futures are trading lower today, indicating a negative opening for Wall Street.

Nasdaq Futures are trading down by 32 points (down 0.2%) while Dow Futures are trading down by 5 points (flat).

The rupee is trading at 74.28 against the US$.

Gold prices are trading up 0.1% at Rs 46,452 per 10 grams.

Gold prices were trading lower in domestic markets today following a muted trend in international spot prices. On MCX, gold contracts were trading 0.1% lower at Rs 46,334 per 10 grams

In international markets, spot gold was flat at US$ 1,750.3 per ounce having recorded its biggest one-day percentage gain since 6 May on 11 August, a Reuters report said.

On 11 August, gold prices gained amid profit-taking in the dollar index after US CPI data.

To know more about gold, check out our article on how to invest in gold here: How to Invest in Gold?

Moving on to stock-specific news...

Among the buzzing stocks today is Indoco Remedies.

Shares of  HYPERLINK "https://www.equitymaster.com/result.asp?symbol=INDOCO&name=INDOCO-REMEDIES-Stock-Quote-Chart" Indoco Remedies zoomed 20% on the BSE in intra day trade today and hit a record high of Rs 529.7 after the company reported strong results for the June 2021 quarter.

The company reported a 40.2% year on year (YoY) rise in revenue at Rs 3.9 bn on the back of a healthy growth in domestic markets due to traction for its Covid-19 portfolio during the second wave.

The company's revenue from export formulations grew 60.5% YoY to Rs 1.5 bn driven by strong growth in regulated and emerging markets, while domestic formulations grew 46.3% YoY to Rs 2.2 bn.

EBITDA (earnings before interest, taxes, depreciation, and amortization) margins also expanded 1.1% YoY to 22.5% on account of lower employee expenses.

As a result, the company's net profit more than doubled at Rs 396 m from Rs 172 m in the June 2020 quarter.

After going through rough patches in the financial year 2020, where Indoco faced headwinds on the domestic front and exports front, the situation is returning to normalcy.

Indoco is expected to post strong top line growth in the financial year 2022 as domestic sales normalize and grow, amid opportunities arising out of post-Covid-19 complications.

Export formulations are also expected to post a robust growth on the back of a strong pipeline and visible launch schedule.

We will keep you posted on more updates from this space. Stay tuned.

At the time of writing, Indoco Remedies shares were trading up by 14.8% on the BSE.

Speaking of the stock markets, India's #1 trader, Vijay Bhambwani shares a simple hack to boost intraday profits, in his latest video for Fast Profits Daily.

Tune in here to find out more:

Moving on to news from the smallcap space...

VIP Industries Profitable Again, Stock Zooms 14%

Shares of VIP Industries vaulted 14% on the BSE in the intra-day trade today after the company posted turnaround numbers for the June 2021 quarter.

VIP Industries, which is the leading manufacturer of hard and soft luggage in Asia, reported a consolidated net profit of Rs 25.3 m compared to a net loss of Rs 513.2 m in the year ago period.

The company's consolidated revenue from operations, meanwhile, surged 411.4% year on year (YoY) to Rs 2.2 bn as against Rs 403.2 bn in the June 2020 quarter.

The overall expense skid 18% YoY due to a reduction in CSR spends, factory related costs and elimination of all discretionary spends.

Employee cost was almost in line with last year in the same period as well as a sequential quarter.

On the operational front, EBITDA (earnings before interest, tax, depreciation, and amortisation) was at Rs 270 m with margins at 12%.

Gross margins came in higher at 54%, mainly due to lower discounts and better mix in favor of higher margin products and a price increase.

How the company performs in the next quarter remains to be seen. Meanwhile, stay tuned for more updates from this space.

Speaking of smallcaps, note that the BSE smallcap index has surged 188% since the crash in March 2020.

Despite the index being up more than 1.8 times, Richa Agarwal, lead Smallcap Analyst at Equitymaster, believes smallcap stocks are set for a massive up move in 2021 and beyond.

Here's why...

The Smallcap to Sensex ratio, a metric referred to get a sense of relative valuations, currently stands at 0.48 times. To be sure, this is higher than a median of 0.43 times.

And yet, it's the lowest of all the peaks in the smallcaps so far. In the last cycle which peaked in January 2018, when the ratio touched 0.49, the peak was still 9 months away.

Here's what Richa wrote in a recent edition of Profit Hunter...

• When it comes to buying smallcap stocks, especially at this point in the rebound rally, you will need a bottom up approach, and a long term horizon.
  
  

  In fact, if you don't have the stomach to withstand a 20%-30% kind of corrections and volatility, this space may not be for you at all. And you should stop reading right here.

  As per Richa, smallcaps are a great opportunity to make some big returns. But you need to stay disciplined when it comes to allocating money. And you need to be sharp when picking the right stocks.

  To know what's moving the Indian stock markets today, check out the most recent share market updates here.

  For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

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