Dear Trader…
Indian equities continued their firm trade in the today session on back of sustained buying in frontline counters. The sentiments in the market were supportive on report that showed foreign institutional investors remained net buyers of Indian stocks on July 28. FIIs have net bought shares worth Rs 1,637.69 crore, as per provisional data available on the NSE. Additional support came in with RBI’s data showing that bank credit rose by 12.89 per cent to Rs 122.81 lakh crore and deposits by 8.35 per cent to Rs 168.09 lakh crore in the fortnight ended July 15, 2022.
On the global front, Asian markets were trading mixed as traders were focused on a possible slowdown in the pace of rate hikes rather than a US recession after data showed its economy shrinking for a second straight quarter.
Nifty futures opened at 17095.00 points against the previous close of 16955.20 and opened at a low of 17055.90 points. Nifty Future closed with an average movement of 167.05 points and a rise of around 252.25 points and 17207.45 points...!!
On the NSE, the midcap 100 index will rise 1.42% and smallcap 100 index is closing rise 1.70%. Speaking of various sectoral indices only PSU Bank stocks were seen selling on the NSE, while all other sectoral indices closed higher.
At the start of intra-day trading, August gold opened at Rs.51490, fell from a high of Rs.51501 points to a low of Rs.51159 with a decline of 98 points, a trend of around Rs.51206 and September Silver opened at Rs.57830, fell from a high of Rs.58239 points to a low of Rs.57560, with a rise of 119 points, a trend of around Rs.57738.
Meanwhile, Credit Rating Agency ICRA in its latest report has revised retail sector outlook to stable from negative. It said the retail sector is coming out of the woods and is expected to surpass its pre-pandemic levels of revenues and earnings in FY2023, following two years of sub-par financial performance. It stated retail firms in its sample set will see an increase in sales of 12-13% year over year in FY2023, which is a 5–6% increase above pre-pandemic levels. Their operational profit margins (OPMs), driven by the advantages of operating leverage, are anticipated to increase YoY by 150 bps to 8.2% (comparable to FY2020).
The report further said the level of discounting by the retail industry remained low during FY2021 and FY2022 (compared to FY2020) as retailers attempted to protect their gross margins against the backdrop of reduced sales. With footfalls and revenues surpassing the pre-pandemic levels in FY2023, it expects the level of discounting to go up as retailers compete to grab a higher share of the consumer’s wallet. Besides material costs, rental, employee costs, and selling/promotional expenses are the other key cost heads of a retail entity, typically accounting for 29-30% of its total cost.
ICRA said after the strict cost rationalization seen in FY2021, retailers largely rolled back the cuts on employee expenses and advertising expenses in FY2022. Retailers undertook rental negotiations in FY2022, following the sporadic restrictions on mobility. However, it said the extent of concessions received was markedly lower vis-a-vis FY2021. While these costs will rise further in FY2023, the OPM will expand as a result of healthy revenue growth and the benefits of economies of scale.
Technically, the important key resistances are placed in Nifty future are at 17303 levels, which could offer for the market on the higher side. Sustainability above this zone would signal opens the door for a directional up move with immediate resistances seen at 17373 – 17404 levels. Immediate support is placed at 17170 – 17077 levels.
Note :- Before Act please refer & agree Terms & conditions, Disclaimer, privacy policy & agreement on www.nikhilbhatt.in
