On Tuesday, Indian share markets traded on a positive note throughout the session and ended marginally higher.Benchmark indices staged a sharp rebound with the Sensex surging over 1,000 points in intraday trade, rebounding after seven consecutive days of decline amid ongoing foreign selling and lackluster corporate earnings.However, as the session progressed, some gains were erased. Indian markets came under pressure during the last hour of trade as Reliance shares fell 2% while other heavyweights like Tata Steel, SBI, and L&T also dragged.At the closing bell on Tuesday, the BSE Sensex stood higher by 239 points (up 0.3%).Meanwhile, the NSE Nifty closed up by 65 points (up 0.3%).HDFC Bank, Tech Mahindra, and M&M were among the top gainers today.Reliance, SBI, and Tata Steel, on the other hand, were among the top losers today.Both, the BSE MidCap index and the BSE SmallCap index ended higher by 0.9%.Shares of Coforge, Pix Trans, and Aditya Birla Sun Life AMC hit their respective 52-week highs on Tuesday.
Why the Indian Share Market is Rising TodayHere are some reasons why Indian markets staged a sharp rebound today –# Global Eyes Turn to IndiaAfter continuous FII outflows from the Indian markets, global brokerages like CLSA, Citi, and HSBC have shifted their focus from China to India due to contrasting economic conditions.CLSA recently decided to reverse its earlier move from India to China, citing growing concerns over China’s economy and investor sentiment.# China Ends Export Tax RebatesChina has announced sweeping changes to its export tax rebates for key commodities, including aluminum, copper, and oil products, effective from 1 December 2024.This development has buoyed sentiment in the Indian commodity market, driving metal stocks in India higher.# Strong Global CuesStrong global markets have supported Indian markets surged alongside.For instance, Asian stocks advanced today as US bond yields and the dollar retreated from multi-month highs.# Maharashtra ElectionsApart from the above reasons, markets also gained momentum ahead of the state elections. Market participants are projecting the outcome of the Maharashtra election, voting for which is scheduled for tomorrow.# Looking for Value Amid this CorrectionOne more reason could be value buying. Indian share markets have corrected from their peaks and a lot of good quality stocks are now available at decent valuations.
Monthly Payment Plans for Gold LoansIn news from the finance sector, after the Reserve Bank of India (RBI) pointed out deficiencies in gold loan disbursals by banks and gold loan companies, the industry is now planning to introduce monthly amortization plans.According to reports, regulated entities could ask consumers to begin paying interest and principal in equated monthly installments as soon as the loan resumes. Lenders are also exploring the term loan route to give loans against gold.In a September circular, the regulator had pointed out irregularities in granting loans against gold ornaments and jewelry. This was after the central bank found issues in the sourcing of gold loans, valuation, due diligence, end-use monitoring, auction transparency, loan-to-value (LTV) ratio monitoring, and the application of risk weights.The regulator also found that rolling over gold loans with only part payment was a deficient practice.The circular came following high growth in the gold loan portfolio of both banks and NBFCs over the past few quarters.According to rating agency Crisil, retail loans against gold jewelry increased by 37% for banks between April 2024 and August 2024 even as gold prices rose.For gold-loan-focused NBFCs, growth in assets under management in the first quarter of FY25 was 11%.Note that the price of gold has been volatile recently.Since August this year, the gold price has moved up from close to Rs 70,300 per 10 gm to 81,800 per 10 gm in October 2024.This move in less than 3 months was in line with global trends. Internationally, the gold price, measured in US dollars, has been on a steady rise since early 2024.At Equitymaster, we recommend holding at least 5-10% of one’s total investments in gold.It makes sense to hold some gold in one’s long-term portfolio, but it doesn’t make sense to speculate on gold’s short-term price movements.Also, while considering an investment in gold, have a time horizon well beyond 2025. Just because prices have gone up or down recently, doesn’t automatically make gold a good or bad investment.
Why PG Electroplast Share Price is RisingMoving on to news from the electronics space, share price of PG Electroplast soared today following its EV and battery assembly venture.The company’s wholly owned subsidiary has signed an agreement with Spiro Mobility for an exclusive partnership for manufacturing Spiro’s EV in India.The company informed that its primary responsibility includes setting up and managing the manufacturing facilities for electric vehicles, lithium-ion batteries and related components and for procurement of parts and raw materials for the same as specified by Spiro.Spiro, meanwhile, will be responsible for the research and development, marketing, sale, and distribution of the EV products manufactured by PG Technoplast.PG Electroplast, the flagship company of the PG Group, established in 2003, is a prominent player in India’s electronic manufacturing services (EMS) industry.The company has positioned itself as a significant player in India’s Electronic Manufacturing Services sector, boasting a diversified client portfolio across multiple industries.In line with its long-term strategy, the company is working to reduce its reliance on Chinese imports by increasing domestic value addition over the next 2-3 years.This aligns with the broader confidence in India’s growth prospects, particularly given the low penetration of products such as air conditioners and washing machines, which are expected to fuel future demand.Moreover, the company is aiming to secure a PLI incentive of Rs 300 m and an additional state benefit of Rs 6 m for the current financial year.To support future growth, PGEL is planning a significant capacity expansion, targeting 350,000 indoor units, 300,000 outdoor units, and 50,000 window ACs by the year-end. The company expects peak season utilization to reach 80-90%.While recognizing the rising competitive intensity, PGEL remains confident in sustaining demand through its cost-efficient structure and alignment with industry trends.Looking forward, the company expects revenue growth of 20-25% over the next few years and is open to scaling with debt if opportunities arise that align with its return targets.For more, check out our research on where will the stock of PG Electroplast be in 3 years.
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