Indices at day's high; Media stocks in demand

The Sensex and the Nifty continued to trade with robust gains in mid-afternoon trade, supported by firmness in Reliance Industries (RIL) and HDFC twins. At 12:25 IST, the barometer index, the S&P BSE Sensex, rallied 615.74 points or 1.67% at 37,555.31. The Nifty 50 index added 161.65 points or 1.48% at 11,053.60.

RIL (up 5.42%), HDFC Bank (up 4.19%) and HDFC (up 1.65%) advanced.

In broader market, the S&P BSE Mid-Cap index added 0.99% while the S&P BSE Small-Cap index added 1.26%.

The market breadth was strong. On the BSE, 1637 shares rose and 902 shares fell. A total of 142 shares were unchanged.

Foreign portfolio investors (FPIs) bought shares worth Rs 7,818.49 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 135.55 crore in the Indian equity market on 3 August, provisional data showed.

COVID-19 Update:

Total COVID-19 confirmed cases worldwide stood at 18,224,253 with 692,679 deaths. India reported 5,86,298 active cases of COVID-19 infection and 38,938 deaths while 12,30,509 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.

Numbers to Track:

The yield on 10-year benchmark federal paper fell to 5.826% compared with previous closing of 5.837% in the previous trading session.

In the foreign exchange market, the partially convertible rupee edged lower to 75.045 compared with its previous closing 75.01.

In the commodities market, Brent crude for October 2020 settlement fell 48 cents to $43.67 a barrel. The contract rose 1.45% to end at $44.15 in the previous trading session.

MCX Gold futures for 5 August 2020 settlement fell 0.36% to Rs 53,800.

Buzzing Index:

The Nifty Media index jumped 3.66% to 1,318.45, snapping its seven days losing streak. The index had lost 7.2% in last seven trading sessions from its previous closing low of 1271.95 posted on 3 August 2020.

TV 18 Broadcast (up 7.59%), Zee Entertainment (up 6.6%), Hathway Cable (up 4.99%), Dish TV (up 4.64%), Inox Leisure (up 3.75%), Sun TV (up 1.49%) and Jagran Prakashan (up 1.22%) advanced.

Earnings Impact:

Dixon Technologies (India) shed 0.77% to Rs 7914.50 after the company's consolidated net profit slumped 93% to Rs 1.60 crore on a 55% decline in revenue from operations to Rs 516.94 crore in Q1 FY21 over Q1 FY20. EBITDA fell 68% to Rs 17.10 crore in Q1 June 2020 from Rs 53.15 crore in Q1 June 2019. EBITDA margin was at 3.3% as on 30 June 2020 as against 4.6% as on 30 June 2019.

Varun Beverages gained 4.64%. The company's consolidated net profit slumped 64.69% to Rs 142.97 crore on 41.58% drop in revenue from operations to Rs 1,665.69 crore in Q2 June 2020 over Q2 June 2019. Post lockdown restriction imposed by the Government of India due to the COVID-19 pandemic, sales volumes got severely impacted in the last 10 days of March 2020 and through-out the second quarter. Profit before tax (PBT) tumbled 68.76% to Rs 181.86 crore in Q2 June 2020 as against Rs 582.30 crore in Q2 June 2019. EBITDA tumbled 52.1% to Rs 377.70 crore in Q2 June 2020 from Rs 787.90 crore in Q2 June 2019. While, gross margins improved by 300 bps during Q2 2020 primarily due to favorable PET chips prices and higher mix of CSD. EBITDA margin fell 501 bps in Q2 FY2020 compared with Q2 FY2019.

VST Industries jumped 6.48% after standalone net profit rose 0.03% to Rs 75.71 crore on 19.4% decline in net sales to Rs 245.39 crore in Q1 June 2020 over Q1 June 2019. Standalone profit before tax (PBT) dropped 13.2% to Rs 102.02 crore in Q1 June 2020 as against Rs 117.54 crore in Q1 June 2019. Current tax expense for the quarter tumbled 35.4% at Rs 27.11 crore as against Rs 41.99 crore in Q1 June 2019.

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