Tale of the Tape 

Good evening everyone!

Markets were back in the green with the Nifty and Sensex gaining +0.7% each. On the other hand, Midcaps (-0.5%) and Smallcaps (-1.8%) continued to decline. PS - Smallcaps slipped into the bear territory after falling -20% from their September highs. The advance-decline ratio was in favour of the bears (3:2).

Most sectors ended in the red. Pharma (-2%) and Energy (-1.4%) were the top losers. Real Estate (+2.1%) and NBFCs (+1.9%) saw the most buying.

China’s DeepSeek is causing ripples world over; including Indian AI stocks. Read our top story to find out why and if this is justified.

Kaynes Technology (-11%) nosedived after its Q3 missed estimates. Cipla (+2%) on the other hand had a solid Q3 show. More details below.

Banking and NBFC stocks killed it today after the RBI came out with its liquidity hammer. Check out their charts below.

Brokerage reactions. DLF (+3%) gained after HSBC upped its target price to Rs 1,050 p/sh vs Rs 1,010 earlier. Balkrishna Industries was up +6% after Nomura upgraded the stock.; the company also reported in-line Q3 results.

360 One WAM (-5%) and IIFL Finance (-2%) were in focus after reports said tax officials raided their offices.

Q3 reactions. Hyundai Motor India (-1%) reported a -19% YoY drop in profit. Apar Industries cracked -19% after a surprising 250 bps drop in EBITDA margins.

Paytm (-2%) closed down after its subsidiary Paytm Payments Bank CEO Nakul Jain resigned abruptly.

Swiggy dipped below its IPO price of Rs 390 p/sh intraday before recovering.

Greenlam Industries (+2%) will consider the proposal of a bonus issue on Jan 30.

Here are the closing prints:

Market
DeepSeek Causes Deep Trouble

AI-related stocks in India CRASHED after Chinese start-up DeepSeek’s new model triggered a global rout in tech stocks. FYI - Anantraj, Netweb Technologies and Hitachi Energy cracked upto -20%. It’s tough to separate substance from fluff here, so here’s what you need to know.

Recap time: DeepSeek stunned Silicon Valley last week after it said it took only 2 months and less than $6 million to build a bleeding-edge model. It got around US export restrictions by making its code super efficient, which allowed it to run on old-ass Nvidia chips. 

Why it's a big deal: Until now, most people assumed that more money = better AI models. Specifically, if you bought better chips and built more data centres, you would get better results. Billions of dollars have poured into this around the world as a result.  This assumption is now being challenged BIG time and has huge implications. 

Anant Raj (-20%) for instance is planning to scale up its data centre business. Netweb Tech (-10%) has tied-up with Nvidia to make chips. Smaller companies like E2E Networks (-5%) are betting on GPU computing solutions. All of this has partly depended on the AI boom in some way, which is why investors are freaking out now.

Big Picture: Everyone needs to take a deep breath. Yes, there are concerns for the AI supply chain. But it’s important to understand the actual impact. For instance, Anant Raj’s data centre operations account for just 8% of operating profit and its planned infra can also be used for MANY other customers. Firms like Netweb require more careful analysis. Efficiency & cost savings were always gonna hit the AI race. Having it happen now, rather than later, is better for the health of the industry.

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Budget 2025 Stock Picks

Budget week is here!!! Check out our latest video where we discuss top 5 investment ideas by SEBI RAs that can gain big time from this year’s budget.