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MOSL: INDIA STRATEGY – NOV’21 | The Eagle Eye: Nifty takes a pause; Macros/Micros show strong traction

INDIA STRATEGY – NOV’21 | The Eagle Eye: Nifty takes a pause; Macros/Micros show strong traction

 

In this version of ‘The Eagle Eye’, we highlight (a) PSU Banks, Real Estate etc. showing outperformance in Oct’21 while margin pressures impacting Consumer Staples b) Nifty companies which have remain unchanged since Dec-10 have driven Index rally, c) Defensives and Global cyclicals driving Nifty performance since Dec’19, d) Earnings revision driving market cap for BSE 200 companies and e) Consumer Discretionary outperforming Staples post second wave.

• India underperformed EM in Oct’21 as rising Energy prices and yields led to outflows from FII.
• Average Daily turnover increased to INR880b which is the second highest since Feb’21.
• Nifty companies which were part of the index in Dec’10 and presently have outperformed the Nifty by 24% on an aggregate basis.
• Consumer Discretionary companies have outperformed Staples post second wave in May’21.
• Ownership Analysis: DII stake in Nifty 500 falls to a 12 quarter low. FII-DII ratio remains steady at 1.6x
• Macro Trends- Improvement in high frequency indicators as GST receipts are up 11% MoM, exports up 6% MoM, NETC collection at highest ever levels of INR 1.1b/day.
• Active COVID-19 cases declined below 159K in Oct’21. India has administered more than 1.08b vaccine doses cumulatively. Pace of vaccination has slowed down from 7.9m/day in Sep’21 to 5.6m/day in Oct’21.