The joint venture of Jio Financial Services and BlackRock to foray into India's asset management space could be disruptive but not disastrous for incumbent industry players, analysts said on Thursday. As an investment strategy, analysts suggest investors stay put in shares of those AMCs that consistently improve business metrics, and where market capitalisation-to-asset under management (AUM) valuation is not stretched. However, growth expectations of incumbent players may get trimmed in the medium-to-long term, analysts said, once the Jio-BlackRock JV unveils its plans, discounting the looming challenge as significant enough to dent their profitability.
Since UK referendum outcome to exit European Union last Friday, 32 companies have hit record highs.
Experts point to the higher contribution of rural from the north for the growth reported by the region, a point endorsed by companies who've been pushing their presence aggressively there.
There is positive correlation between crude oil prices and Indian equities and investors can expect more upside after the recent rally in Brent crude price.
While sales momentum from rural areas may last another three to six months, sales growth in urban areas could stage a comeback by next year's June quarter as people learn to live with the coronavirus and economic activity gradually improves in the cities.
Automobile company Tata Motors, metals and mining major Vedanta, oil marketing firm Bharat Petroleum Corporation (BPCL), private sector IndusInd Bank, and two-wheeler major Bajaj Auto have witnessed their market cap slip below the Rs 1-trillion mark this year.
Index heavyweights continue to be top losers with ICICI bank.
With markets expected to remain volatile, promoters and lenders exposed to the industrials and materials space can face brunt of the price erosion of the pledged shares.
While a little more than 140 penny stocks have doubled in value, 555 have given negative returns in the past year. Of these, 84 shed more than half their value.
While companies have not launched too many products in rural areas of late, easy financing has helped push up demand.
Shares of Motilal Oswal Financial Services, Edelweiss Financial Services and IIFL Holdings have all doubled in the past one year against the Sensex's 23 per cent gain.
The risk-reward ratio could turn adverse for foreign investors if corporate earnings disappoint by wide margins, or if crude oil prices spike in the international market, putting pressure on the rupee-dollar exchange rate.
Analysts attribute this fall to the recent moderation in energy (mainly crude oil) and commodity prices, lowering of input costs for companies in sectors such as FMCG, consumer durables, and automobiles, reports Krishna Kant.
The bourse's valuations may get a boost, as it gets set for its OFS of about Rs 10,000 crore.
A weaker rupee could aid corporate earnings through its positive impact on export intensive sectors such as information technology services, pharmaceuticals and commodity producers such as metal and mining, and oil and gas companies.
ICICI Bank was the top loser along with index heavyweights RIL, ITC and HDFC.
BSE PSU index rallies 10% in one month; nearly a third of the stocks on the index has gained 20% over the period
Financial shares were among the top Sensex gainers along with auto and pharma shares.
BJP loss could trigger a correction
'Kerala isn't as dependent on agriculture like Bihar or Odisha or even other southern states.' 'Economic losses would not be too intense, unlike other states.' 'The floods could, at best, impact India Inc's earnings for a quarter or two.'
The sentiment around Indian equities remains positive and unchanged.
From MRF to Shree Cement: 23 companies which delivered 30% CAGR in 15 years.
ICICI Bank was the top gainer after stable rating for its senior unsecured bonds by S&P Global Ratings.
Banking and real estate stocks rise up to 5% on further rate-cut hope.
Pharma stocks have performed well after Budget
Pharma shares extended losses after the government's ban on combination drugs.
In good times, analysts justify valuations giving interesting investment rationale.
IT exporters were the top gainers amid a weak rupee along with select index heavyweights.
The Indian indices also offer one of the lowest dividend yields.
Stock prices is due to valuation expansion
New strategy for Infosys by October, says Nandan Nilekani. New chairman's other priorities: Hiring CEO, reviewing Panaya probe reports.
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