Tale of the Tape 

Good evening everyone. Markets took a beating today! 🤕

Nifty (-0.6%) and Sensex (-0.5%) fell after a selloff in key heavyweight stocks. Midcaps (-1.9%) and Smallcaps (-1.9%) got absolutely THRASHED. 416 stocks in the NSE 500 ended in the red! 🚨

Check out the Stocktwits Sentiment Meter:

Most sectors ended in the red. Real Estate (-3.5%), Metals (-2.4%) and PSU Banks (-2.3%) got beat up the most. FMCG (+2%) and IT (+0.8%) were the two lone bright spots. ⭐

Nifty FMCG Index saw its single-biggest gain in nearly two years. Read our top story below on the reasons behind the rally. 🚀

TBO Tek’s Rs 1,551 cr IPO opens for subscription tomorrow! Check out our analysis that will help you decide on whether to invest or not. 🔍

Titagarh Rail Systems rallied +9% intraday after Morgan Stanley initiated coverage on the stock; the brokerage sees a +19% upside from current levels. 🔥

BPCL and Hindustan Petroleum will consider issuing bonus shares on May 9. ✌️

Results reaction. Route Mobile cracked -5% after weak Q4 numbers. Lupin fell -4% despite a decent Q4 show. 📉

Happiest Minds Technologies (+2%) forecasts 35-40% revenue growth for FY25. 📊

Zee Entertainment hits over four-year low; tanks 52% so far this year. 😣

Indegene IPO was subscribed 4x on Day 2 of bidding. 👍

Here are the closing prints: 

Specials
5 Stocks To Buy In May - By SEBI RAs

Markets are near all-time highs but is it a good time to invest now? In this video, we cover 5 investment ideas by SEBI RAs which can deliver healthy returns even from current levels.

Stocks
2024: The FMCG Comeback Year

Marico rallied +9% intraday after reporting a solid set of Q4 results. Its topline FINALLY grew after three straight quarters of decline! Operating margins were also up 200 bps to hit 19.4% as inflation cooled off and other key commodity prices remained stable. Overall, a decent Q4 show that mostly met Street estimates. 💪

Marico isn’t alone though. Most FMCG stocks have been on a ROLL this last week: HUL, Dabur, Britannia and Godrej Consumer are up +6% to +8%. After an awful 2022-2023, things may have FINALLY started looking up again. 📈

Rewind time: The overall sector got its teeth kicked in back in 2022. Inflation soared after Russia invaded Ukraine. Rural consumer incomes never really recovered after Covid like urban India did. And to top it off, a rainfall deficit punched the rural economy while it was still down. Fun fact: India’s monsoon rainfall hit a 5-YEAR LOW in 2023. 🌧️

So what’s changed? A bunch of things:

1) Inflation: Overall inflation is down, including most commodities. Prices of edible oils & wheat, two key input costs for many FMCG firms, are stable which is a major POSITIVE. Global pressures around cocoa beans (a key ingredient for chocolate products) are still a concern but aren’t a red flag just yet. ✅

2) Monsoon: The IMD has predicted “above normal” rainfall for the June-Sept monsoon season; more precisely, it projects 106% of India's seasonal rainfall average. This is GREAT news for the rural economy. FYI- Dabur, a major rural FMCG player, reported HIGHER growth in its rural markets vs urban (8% vs 5%) in Q4. 😇

3) Local rivals falter: Most FMCG firms reported market share gains in Q4 across product categories. This is good news because it means competition posed by local unlisted players is finally starting to ease off. ⚔️

The management of most companies have been EXTREMELY bullish. Britannia has guided for “double-digit” volume growth in FY25. Dabur says “high single-digits” is possible. HUL has said the worst is over and volume recovery will happen in H2FY25. The long-awaited FMCG upturn may finally be here!

Contest

May I Have Your Attention Please

Join the Stocktwits League and stand a chance to win a trip to Goa + other exciting prizes! Predict the closing prices of selected stocks for each day and you could win a trip to Goa for 2 along with other fabulous prizes! Simply submit your predictions before the cutoff time each day!

IPO

New Day New IPO

TBO Tek IPO opens for subscription tomorrow! The price band is fixed at Rs 875-920 p/sh. The company aims to raise Rs 1,550 cr from the IPO. 💸

Founded in 2006, the company is an online B2B travel platform. Suppliers like hotels, airlines or car rental companies can connect with buyers like travel agencies, tour operators or independent travel advisors. For example, suppose you buy an air ticket on a third-party aggregator, it's likely that the aggregator purchased that ticket from TBO Tek’s platform. FYI - The company takes a cut from all transactions made on its platform. FYI - its ‘take rate’ is a LOT higher for hotels and ancillary (7%-8%) over airlines (2.5%). As of Dec 2023, it connects nearly 1.6 lakh buyers across 100 countries with more than 1 million suppliers. ✈️ 

FYI - the IPO’s fresh issue comes in at Rs 400 cr; the rest being an ‘Offer for Sale’ by promoters and other investors. Most of this money will be used to strengthen its tech platform, grow its international biz and boost marketing spend. 📊

9M FY24 snapshot:

• Revenue: Rs, 1024 cr; +31% YoY

• EBITDA: Rs 193 cr

• EBITDA Margin: 18.8% vs 18.6%

• PAT: Rs 154 cr; +28% YoY

Big Picture: Global travel & tourism is expected to grow at a CAGR of 8% over FY23-FY27. The company steadily increased buyers & suppliers. Its commission rate has also grown, although it may be hitting an upper limit;( PS - the segment is already nearly 50% of its platform’s gross transaction value). The only problem? Its valuations are slightly expensive. But, that may not matter as current grey market data suggests it may list at a cool 56% premium! 🤑

Links That Don’t Suck

💯 5 Stocks to Buy in May 2024 | 2024 Top Picks by SEBI RAs | Stocks to Buy Right Now

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