Following a nearly 3.5% loss in September, Indian equity benchmarks recovered in the first week of the third quarter. The Nifty finished the week with a gain of 1.29%, while the Sensex gained 1.33%.
On Friday, the Indian rupee extended its selling pressure to reach another record low level of 82.2 against the dollar and settled above 82 for the second day in a row. The Indian rupee fell by 1.61% in the last week. The RBI's attempts to support the currency failed to stop the rupee's sharp depreciation.
Crude oil prices rose nearly 4% on Friday and 15% last week, marking it the single largest weekly gain since March. Oil prices began to rise after OPEC+ members agreed to reduce oil production by 2 million barrels per day, the largest reduction since the pandemic began. This is the second output cut by OPEC since September when the members of OPEC+ reduced output to 100,000 barrels per day in last month.
On the back of rising crude oil prices and the fall in the rupee, India's 10-year government bond yield rose to a 15-week high of 7.49%. Earlier this week, JP Morgan decided not to include the country's local debt in its emerging market index, citing the lengthy investor registration process and the operational readiness required for onshore trading, settlement, and custody of assets.
Meanwhile, five stocks in the BSE 500 index returned 15-28% this week, while 12 stocks gained 10-15%.
In just six trading sessions, Mazagon Dock shipbuilders' stock jumped 47.63% and 28.3% this week. The stock has generated a multi-bagger return of 145% over the past one year and 127% on a year-to-date basis. The stock price increased from ₹408.60 to ₹633 in the last month, representing a 55.14% return on the strong business outlook.
Cochin Shipyard was another bigger mover this week, rallying 19.1%. The stock hit an all-time high of ₹529.5 on the BSE in Friday's trade.
Mishra Dhatu Nigam, this PSU metal stock reached a 52-week high of ₹247.8 on Friday. During Friday's intraday, the stock recorded a volume of 4.5 million, a 1.90x surge over its average weekly volume of 2.3. The stock's volume has been steadily increasing during the week.
Since the first week of July, stockholders of the company have seen a return of about 49 per cent to date. The stock saw the majority of its gains after it secured an order worth ₹185 crore in September.
Mishra Dhatu Nigam Ltd., or MIDHANI for short, is a manufacturer of specialty metals such as superalloys, titanium, special-purpose steel, and more.
Mahindra CIE Automotive increased 15% this week, from ₹273.95 to ₹317.25. On Friday, the stock recorded a new 52-week high of ₹324. Over the last six months, the stock has delivered a return of 62.87% to its shareholders.
Poly Medicure, JSW Energy, Delta Corp, Godfrey Phillips, Indiabulls housing finance, Vakrangee ,Angel One, Rites, and Zomato are among the other stocks that have gained 10% to 15% this week.
Top Losers
This week, two major FMCG stocks—Godrej Consumer Products and Dabur India—saw declines of 8.9% and 5.7%, respectively, following their quarterly updates. Dabur warned that rising inflation during the second quarter of FY23 could lower its operating margin by around 150-200 bps YoY, and it expects revenue to grow in the mid-single digits.
Godrej Consumer Products posted a muted update for the September quarter. "We expect a mid-single-digit volume drop, with a low single-digit 3-year volume CAGR." Personal Care sustained its strong double-digit growth trajectory, while Home Care witnessed close to mid-single-digit growth," the company said.
India's retail inflation in August surged to 7% on an annual basis, up from 6.71% in July 2022. It remained above the Reserve Bank's comfort level of 6% for the eighth consecutive month.
While other FMCG majors like HUL, Marico, Colgate-Palmolive, Tata Consumer Products, and Britannia Industries saw declines between 4.5% and 1.5% this week.
FMCG sales in September, fell 14.3% in rural India, while urban areas saw moderate growth of 1.1%. Overall FMCG sales fell by 9.6 per cent in September as compared to August. Rural sales form 65-70 per cent of FMCG sales, Business standard reported quoting Bizom data.
Commodity products (wheat, rice, edible oil, etc.) experienced the greatest month-over-month sales decline of all categories at 14.5 percent, followed by home care products at 8.6 percent.
On a year-on-year basis, FMCG sales were up 8.1 per cent in September, while for the July-September quarter, the increase was 12.3 percent, according to Bizom’s data.
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