However, for the current upmove to end, Nifty should close below 6020.
The Indian equity market ended with smart gains on Tuesday. The Nifty ended just shy of hitting the 6,100 mark while the Sensex managed to surge past the 20,350 in mid-afternoon trades. The Sensex closed at 20,302, up 143 points, while the Nifty shut shop up at 6,077 over Monday's close of 6,031. The National Stock Exchange (NSE) reported marginally higher volume of 44.84 crore shares, when compared to yesterday, while advance to decline ratio was 593:566, indicating that the upmarket movement is not broad-based. On the Bombay Stock Exchange (BSE), 1,149 stocks advanced against 1,150 declines, while 173 remained unchanged.
In the morning, the Nifty opened 33 points higher at 6,064 and the Sensex started the day at 20,249, up 90 points from its previous close. And both indices went up from there. Nifty and Sensex touched their respective highs at 6,093.35 and 20,351.06.
Asian markets also ended with smart gains. The Shanghai Composite gained 2.89%; the Hang Seng rose 2.33%; the Nikkei 225 advanced 0.82%; the Straits Times climbed 0.60%; the Seoul Composite gained 1.27% and the Taiwan Weighted settled 1.35% higher.
The Indian market opened on a bullish note, on the back of strong sentiments in Asia, fuelled by optimism in Japan. However, as far as India is concerned, there are headwinds particularly earnings prospects as well as macro economy vis-a-vis inflation, rupee and current account deficit. The smart upswing was led by FMCG, energy, realty, PSU banking, metals and oil and gas (energy) stocks. Only infrastructure sector ended in the red. However, midcap and smallcap stocks struggled for direction, though both ended the day in the black.
Gains in PSU banking, metals, energy and realty sectors saw the benchmarks emerge into the positive terrain in the first hour itself. The market continued to gain momentum in morning trade on support from finance, information technology and commodities. Pharmaceutical and auto sectors showed downward bias, but still finished in the black.
Meanwhile, the rupee ended the day at 59.76 to the dollar versus 59.72 on Monday.
At the time of writing, two of the three key European markets were trading with minor gains while US stock futures indicates more gains ahead. Foreign institutional investors net sales were $64.08 million On 22 July.
Relatively lower gold prices and pick up in demand boosted net sales, but it wasn’t enough for Thangamayil Jewellery to stem the steady decline in operating profit
Thangamayil Jewellery saw its net sales rise 19% year-on-year (y-o-y) during the first quarter, helped by relatively lower gold prices and pick up in demand ahead of the wedding season. Net sales for the quarter ended 30 June 2013 stood at Rs425.16 crore compared to Rs358.41 crore for the corresponding period last year. Despite pick up in revenues, the company saw its Q1 net profit drop 9.12% y-o-y, to Rs13.75 crore. This is still better compared with a loss incurred in March quarter.
According to data collected by Moneylife, the company has been posting consistent sales growth quarter after quarter. Its net sales for the quarter grew by 19% which is lower than its three-quarter y-o-y growth average of 25%. Yet, we are concerned about its operating profit and net profit, which has shown a downward bias over the last three quarters. The average three-quarter operating profit growth rate is an abysmal -44% while operating profit for the June quarter fell 11%. Its market capitalisation is quoting at 2.47 times its operating profit, which is on the cheaper end. Its return on capital employed stood at 17%.
During the quarter, Thangamayil Jewellery opened its 30th and 31st branch, at Eral and Villupuram, on 10th July. The total area of both the branches collectively totalled 2555 square feet.
As of June 2013, the promoters hold 69.04% stake of the company while foreign institution investors (FIIs) hold 1.26% of the shares outstanding. The general public holds 29.24% of the shares outstanding.
On Tuesday, Thangamayil Jewellery dipped 4.62% to Rs190 on Bombay Stock Exchange (BSE) while the benchmark Sensex closed up 143 points up to end the day at 20,302.
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