Tale of the Tape 

Good evening everyone. Markets recovered slightly after yesterday’s horror show!

Nifty (+0.4%) and Sensex (+0.3%) ended in the green on broad-based buying. Midcaps (+0.9%) and Smallcaps (+1.4%) pulled back sharply. 380 stocks in the NSE 500 ended higher.

Except IT (-0.7%) all sectors ended in the green or flat. Oil & Gas (+1.6%) and Metals (+1.25%) saw the most buying.

Zomato and Swiggy have cracked over -10% from their December highs. Read our top story on how competition is heating up in the quick commerce space.

Quadrant Future Tek IPO kicked off today. Check out our analysis below to help you decide whether to subscribe.

Mobikwik, ONGC and Paras Defence made big moves today. Look at their charts below to find out why.

Akzo Nobel India rallied +6% after reports said Berger Paints was looking to buy its promoter’s stake in the firm.

Market debut. Indo Farm Equipment ended the day at Rs 275 p/sh; +28% higher than its IPO price.

Info Edge fell -4% after nervousness over Zomato rubbed off on the stock.

Hyundai Motor India (+1%) was in focus after Citi initiated coverage on the stock; the brokerage sees +25% upside from current levels.

Arkade Developers gained +6% after adding three new redevelopment projects in Mumbai to its portfolio.

Zydus Lifesciences was up +4% after signing a sales deal with US-based CVS Caremark.

Here are the closing prints:

Stock
The War Is On

Swiggy and Zomato are down 17%-18% from their all-time highs! From putting the pressure on big retailers, their quick commerce arms now find themselves in the boiling pot. So WTF changed in the last few months?

1) The biggest issue is rising competition. DMart ‘Ready’, Flipkart’s ‘Minutes’ and BigBasket’s ‘BB Now’ all either launched or scaled up quickly in late 2024. On top of that, Amazon’s Tez has launched 15-min pilot deliveries and Mukesh Ambani’s Reliance Retail is pivoting towards quick commerce.

2) With more players, there are ALWAYS price wars. Discounts are being handed out like candy. Jefferies estimates that Zepto Super Saver and Flipkart Minutes are offering the most at 22% (for certain categories), followed by DMart Ready (21%), Blinkit (15%) and Big Basket (9%). Higher discounting levels will eventually start taking a bite out of Swiggy and Zomato margins from Q3 onwards, which is a big negative!

Big Picture: Nobody knows how many players can comfortably fit into the $6 billion market; whether the pie is big enough for all 8-9 companies to thrive. What we do know is they are readying their war chests for future cash burn. Swiggy of course has its IPO money, Zomato raised Rs 8,500 cr via QIP recently and Zepto just raised $350 million.

Tl;DR: Higher competition and rising discounts indicate the party is just getting started. FYI - Jefferies is the big bear here, saying 2025 will be a year of ‘consolidation’. The brokerage has downgraded Zomato and cut its target price to Rs 275 p/sh (vs Rs 335 p/sh earlier).

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We’re back with Part 2 of our New Year Stock Picks series. This time we take a look at hot investment ideas from India’s leading broking houses - with up to 60% potential upside!!! The perfect cure for your underperforming portfolio. Do not miss it folks!