Tale of the Tape 

Howdy folks. Happy Friday! 

Markets closed down for a second straight week even after today’s big upmove. Nifty and Sensex jumped +1% each following the overnight rally in US stocks. Midcaps (+0.9%) and Smallcaps (+0.6%) had a good day too. The advance-decline ratio was in favour of the bulls (3:2).

It was a sea of green across sectors. PSU Banks (+1.9%), Auto (+1.7%) and IT (+1.6%) were the top winners.

Paytm has been on a roll for the last three months. Read our top story on how Vijay Shekhar Sharma is turning the ship around.

Eicher Motors (+6%) was the top Nifty gainer after a solid Q1 show. Trent (+12%) hit a record high after its Q1 numbers beat Street estimates.

Ola Electric had a solid market debut, locked in an upper circuit and ending the day +20% higher than its IPO price of Rs 76 p/sh.

NBCC soared +9% after bagging a Rs 15,000 cr Srinagar satellite township contract.

Results reaction. Info Edge (+4%) gained after its Q1 profit jumped +47% YoY. Bombay Burmah Trading was up +5% on a strong Q1 show.

Vedanta (+2%) was in focus after Bloomberg reported that they may postpone the sale of its steel business. The company has denied these reports.

Here are the closing prints:

Stock
Paytm Karo

Paytm is killing it!!! ICYMI - the stock is up a whopping +66% in JUST the last three months. Here’s what’s going on if you want to bet on Vijay Shekhar Sharma’s revival.

For starters, its business ops are starting to recover after RBI hammered its payments bank. Q1 numbers brought in some encouraging signs. New merchant sign-ups, which are basically Paytm’s lifeblood, are near all-time levels, which is good! Net device merchant additions are also on track to reach previous run rates by Q3FY25. Also, ‘per device subscription revenue’ has officially bottomed out.

There are also positive signs on the gross merchandise value (GMV) front. Daily average GMV, excluding disrupted verticals like wallets, is almost back to record highs. The company’s average ‘monthly transacting users’ have also stabilised at 7.8 cr, which means it’s unlikely to drop further.

Finally, two key developments have boosted sentiment. The first is Paytm planning to sell its ticketing & events to Zomato. If the deal goes through, it will give Paytm much-needed cash and allow it to focus on core verticals. Secondly, the GOI has reportedly granted FDI approval for its payment services arm. This will allow it to re-apply for a payments aggregator licence from the RBI and restart key operations!

Big Picture: Paytm is starting to turn around its ship, which is why the stock has been rocketing to the moon. Most of the RBI pain has already been priced in, so the only way forward is up from here! Key future triggers include its loan biz revival, adding new UPI users again and cutting costs.

Earnings
Earnings Roundup

Eicher Motors (+6%) Q1 results beat Street estimates! PS - this was the company’s highest-ever quarterly revenue, EBITDA and PAT. Domestic sales of 350cc+ models jumped 29% YoY. A greater uptick in higher-margin motorcycles helped bump up margins and boost the bottomline. Overall, a good show despite some worry around sales of the Hunter 350 and the Bullet 350, which will need to be monitored.

Here is its Q1 report card:

• Revenue: Rs 4,313 cr; +10% YoY (vs Est: Rs 4,307 cr)

• EBITDA: Rs 1,165 cr; +14% YoY (vs Est: Rs 1,127 cr)

• EBITDA Margin: 26.5% vs 25.6% YoY

• Net Profit: Rs 1,101 cr; +20% YoY (vs Est: Rs 1,016 cr)

The company has done well to maintain topline growth despite a small slump in some of its key models. Going forward, demand recovery, new products and the launch of its first EV bike are key triggers to watch out for.

Eicher Motors is +20% YTD.

Trent (+12%) hit a record high on strong Q1 results. Robust demand from its cheaper Zudio outlets helped supercharge the topline. FYI - the company’s ‘fashion concepts’ saw overall like-for-like growth of +10% YoY. The only sour point was that while its operating margins were up, they came slightly below expectations.

Chairman Noel Tata said: “The overall market sentiment remains subdued with increased competitive intensity. On our part, we continue to witness encouraging traction for our lifestyle offerings across brands, concepts, categories and channels. Focus on delivering consistent and improved value propositions keep us relevant for our customers.”

Trent is doing pretty well despite overall sluggish sentiment + weak growth seen in other lifestyle retail and apparel firms. Execution and diversification are carrying the day. 

Here are its Q1 stats:

• Revenue: Rs 4,104 cr; +56% YoY (vs Est: Rs 3,810 cr)

• EBITDA: Rs 613 cr; +67% YoY (vs Est: Rs 588 cr)

• EBITDA Margin: 15% vs 14% last year (vs Est: 15.4%)

• PAT: Rs 391 cr; +2x (vs Est: Rs 340 cr).

Trent is up +2x YTD

Charts

Movers and Shakers

Here’s a look at this week’s top NSE500 movers. Kfin Technologies took the pole position after rallying +25%. Cera Sanitaryware (+17%) hit a new all-time high. Lemon Tree Hotels tanked -18% on weak Q1 results. Syrma SGS Technology (-16%) hit a 3-month low. Check out their charts below:

Links That Don’t Suck

💬 Stocktwits is hosting a free AMA with SEBI RA Ashutosh Bhardwaj. Click to ask 

📈 Mark Mobius will invest 50:50 in US and India for next 6 months, 1 year and beyond 3 years. Here’s why 

🤑 Bhavish Aggarwal enters billionaire club as Ola Electric shares surge on market debut 

👀 OpenAI says its latest GPT-4o model is ‘medium’ risk 

🙏 Arshad Nadeem did not have a new javelin. Neeraj Chopra had urged Pakistan govt to help him

🍿 What To Watch This Weekend On OTT And Theatres; Exciting Releases You Can’t Miss

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