February 10, 2023

Another Week Draws To An End

Tale of the Tape

Happy Weekend everyone. 🕺

Markets closed barely down as investors booked profits at the upper end of the range. Midcaps (+0.2%) and Smallcaps (+0.5%) fared much better. The advance-decline ratio was split evenly. 🤼

Most sectors ended higher but the gains were minor. Real Estate (+1.4%) pulled back. PSU Banks and Autos were up 0.4% each. Metals (-1.8%) were back in the red. 📉

Zomato’s (-3%) Q3 results failed to excite investors. More details below. 👎

Paytm (-8%) was the top loser on the Nifty 500 after 2.1 cr shares (3.4% equity) changed hands in a block deal. 🔍

Bank of Baroda (+1%) and CG Power (+3%) will become a part of the MSCI Index by end of the month. On the other hand, Adani Group stocks’ weightage will go down to 1.67% (vs 2.83% currently); resulting in $827 million of selling pressure. 🚨

Tata Motors increased the Tiago EV price by Rs 20,000, according to media reports. 💸

M&M will invest Rs 1,000 cr to set up an EV manufacturing unit in Telangana. 🏭

Earnings reaction. Aurobindo Pharma (+6%) hit a 2-month high. UBL (-5%) hit the lowest level since July. 💰

Cryptos were down big. Bitcoin slipped over 3%. Ethereum crashed by 5%. Solana, Cardano and Dot were down between 6%-8% each. 🙈

Here are the closing prints:

Nifty	17,856	-0.2%
Sensex	60,682	-0.2%
Bank Nifty	41,559	+0.1%

Earnings Roundup

Zomato’s Q3 results were honestly meh. Their core food delivery business (83% of overall revenue) slowed in the previous quarter. The Gross Order Value (GOV) grew ONLY 1% over the previous quarter to Rs 6,700 cr. The total number of orders fell by -3% to 16 cr but Average Order Value (AOV) improved. Moreover, the average monthly transacting customer remained flat at 17.4 million in Q3. 📊

Zomato said the industry-wide slowdown is a result of temporary factors like – macro slowdown for the mid-market segment, boom in dining out for the premium-end, and boom in travel at the premium-end. 😮‍💨

Here are its key stats:

Revenue: Rs 1,948 cr; +17% QoQ
EBITDA Loss: Rs 366 cr; (vs EBITDA Loss of Rs 311 cr QoQ)
Net Loss: Rs 347 cr; (vs Net Loss of Rs 251 cr QoQ)

But there are some bright spots (depending on who you ask). Blinkit and Hyperpure reported strong growth (+25% QoQ) while losses stayed flat. In classic Zomato style of inventing new financial metrics, the startup reported that they turned Adjusted EBITDA positive (ex-Blinkit) in January. 🤯

Honestly, we don’t know what that means, but it seems like the company is trying to tell us that they are focused on profitability. This is confusing because on one hand Zomato aims to break even on an operational level and on the other they continue to dole out freebies (Zomato Gold). Let’s see how this goes. 👍

Movers and Shakers

Here’s a look at this week’s top Nifty 500 movers. Paytm took the pole position after gaining +25%. 🥇 Policybazaar (+22%) had its best-ever week since listing. Adani Group stocks continued to remain under pressure. Adani Total Gas and Adani Green were locked in a 5% lower circuit all 5 days of the week. 📉 Check out their charts below:

Earnings Highlights

Mahindra & Mahindra: Revenue: Rs 21,654 cr; (+41% YoY) | Net Profit: Rs 1,528 cr; (+15% YoY)
Life Insurance Corporation of India: Net Premium Income: Rs 1,11,788 cr; (+15% YoY) | Net Profit: Rs 8,344 cr; (+34X YoY)
Aurobindo Pharma: Revenue: Rs 6,407 cr; (+7% YoY) | Net Profit: Rs 491 cr; (-19% YoY)
United Breweries: Revenue: Rs 1,611 cr; (+2% YoY) | Net Loss: Rs 2 cr;