Tale of the Tape 

Good evening everyone! 👋

Nifty and Sensex were up +0.9% each, building on yesterday’s gains. Midcaps (+2.2%) and Smallcaps (+3.2%) also continued their recovery after Tuesday’s fall. 421 stocks in the NSE 500 ended in the green! 📈

Check out the Stocktwits Sentiment Meter:

Except for FMCG (-0.3%) and Pharma (-0.3%), all sectors ended in the green. Real Estate (+4.7%), PSU Banks (+2.9%) and IT (+2.9%) saw the most buying. 💸

Why are investors running to consumption stocks after the election? Read our story below to find out. 🎯

This pharma distributor stock could see +45% gains in one year. More details below. 🤑

ITC (+1%) was in focus after its shareholders approved the demerger of its hotel biz. 🏨

Zee Entertainment gained +6% after approving a Rs 2,000-cr fundraising plan. 💰

HAL was up +7% after opening a new rocket production facility in Bengaluru. 🏭

Bhagiradha Chemicals rallied +15% intraday after Radhakishan Damani bought a 3.5% stake. Yuken India was up +6% after Ashish Kacholia purchased nearly 2 lakh shares. 💯

PB Fintech was in focus after 33 lakh shares (0.7% equity) changed hands in a large deal; the buyers and sellers were not immediately known. 🤝

Here are the closing prints: 

Market
Opportunity In Adversity - Part 2

Yesterday, we discussed how the auto sector could benefit from the chaotic political environment. Today, we’re gonna take a look at 2 more pockets of opportunities. 🤑

First up, is the consumption sector. EVERYONE is predicting the GOI will do something to juice up consumers. Tax cuts, direct cash handouts, higher welfare subsidies; everything’s on the table but nothing’s confirmed. 👀

This is why FMCG and consumer durables, which are ‘defensive’ because they do OK no matter the state of the economy, have SOARED this week. Firms with a big rural exposure like Dabur, Emami and Colgate have seen solid gains. Jefferies also double-upgraded HUL and sees a +10% upside. Liquor stocks are also in high spirits. Tilaknagar Industries, Radico Khaitan and United Spirits are up 7-20% over the last couple of days. 🍻

And then there’s the Chandrababu Naidu stocks. These are all companies that are linked to Naidu’s family or Telugu Desam Party associates. Heritage Foods, Amara Raja and KCP are up 20-40% in the past 2 days. Perhaps a good way to make money, but also something that could crash down quickly. FYI - a stronger bet is looking at companies with big exposure to Andhra Pradesh -- power, infra etc. The state will likely get special status and Naidu wants to make Amaravathi a HUGE mega city. Experts say there will be a lot of money to be made there as well. 🚀

Specials

Election Special: 5 Stocks To Buy - By SEBI RAs 🚀 

Post-election results, markets have shown tremendous volatility. But there's still room to buy stocks at the current dips. Check out our latest video where we share 5 election special picks by SEBI RAs!

Stocks

Pink Of Health

Hey guys, today we’re gonna take a look at recently-listed Entero Healthcare. The stock hit a new all-time high in April before a sharp correction last month. Should you buy the dip or avoid it? Here’s what experts have to say: 🤓

For the unaware: Entero is a leading pharma & healthcare product distributor. It handles an INSANE 67,000 SKUs, which it uses to cater to over 81,000 pharmacies and over 3,000 hospitals. 🩺

What’s popping? For starters, the company has significantly improved its operational efficiency to boost processing & delivery rates. This means it can now deliver orders three times a day within Mumbai. This in turn has played a major role in FINALLY turning the company profitable in FY24! FYI - Entero reported a PAT of Rs 40 cr in FY24 vs a loss of Rs 11 cr in FY23. 📊

The company has never had a problem growing its topline. But it has struggled to improve margins. Entero’s EBITDA margins stood at 2.9% in FY24 (vs 1.95 YoY) and experts say it could hit 5% by FY27, which is a positive. ✅

Entero has also readied up a Rs 1,000- cr war chest for future acquisitions to boost its topline by another Rs 4,000-Rs 4,500 cr by FY27. It may raise up to Rs 200 cr through debt to help it carry out this aggressive expansion strategy. 💯

Big Picture: Entero’s financials look a LOT better, now that it’s proven it can grow its topline while still expanding margins. Its future success depends on how much of India’s unorganized pharmacy sector will start consolidating. Stiff competition from Apollo’s Keimed, which serves the same number of retailers as Entero but has more than double its revenues is another concern. FYI - Monarch Networth Capital is bullish on the stock and has a target price of Rs 1,515 p/sh; a whopping +45% upside from current levels! 🔥

Charts

Chartbusters

Here are three companies that saw big movements today.

1) Uno Minda hit a record high after signing a new EV license agreement with China’s Suzhou Inovance Automotive. FYI - this will let Uno make and sell high-voltage EV products for passenger vehicles in India, helping it make inroads into the 4-wheeler market. ⚡

2) Tech Mahindra was the top Nifty gainer after investors started taking another look at non-capex and infra stocks. The IT sector has very little to do with the Indian economy, which is uncertain AF right now. Most experts also believe the industry should start rebounding from H2FY25, which isn’t too far away! 📈

3) BHEL rallied +14% intraday after winning two key orders worth over Rs 7,000 cr! The first is a contract from Adani Power to set up a 2x800 MW thermal power plant in Chhattisgarh. The other is an order from Mirzapur Thermal Energy to set up a project in Uttar Pradesh. Both contracts are worth Rs 3,500 cr each. 💰

Check out their charts below:

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