Since this budget 💵 has been one amongst the finest 👌🏽 in our opinion, we have decided to make this and the next two Special Issues 💥. Let’s start preparing to transform the upcoming financial year into one of the most profitable ones by making the right decisions.
So take your first correct ✅ step by diving deeply into this Issue and comprehending Fundamental and Sectoral Analysis 📖 !
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India’s non-life insurance industry which comprises auto insurance, general insurance, etc. reported ₹ 25,542 Cr revenue in Jan 2023, the highest ever. Revenue rose 19% vs Jan 2022: General Insurance Council.
Monetary Policy 2023: RBI hiked the Repo Rate, the real GDP growth is estimated to be at 7% in 2023-23 and inflation is expected to roll above the 4% target.
India’s steel exports fell 52.2% to 53.3 lakh tonnes between April and Jan.
Repo Rate: Interest rate charged by RBI on commercial bank borrowings
Reverse Repo Rate: Interest rate paid by RBI on commercial bank deposits
An increase in the Repo rate makes the banks and NBFCs pay more and this trickles down to the customer in the form of increased loan interest and fixed deposit rates. A fall in the repo rate supplements through increased economic activity.
Sectoral Analysis of Insurance sector companies and Steel companies should be carried out.
Looking for stocks to invest in after Budget 2023? click here!
Nifty50 : This Week
Jal Jeevan Mission allocation in the union budget witnessed a growth of 17% to ₹ 700bn to achieve piped water supply for households in India. This will be beneficiary for plastic pipe manufacturers like Supreme Industries, Astral, Prince Pipes and Finolex Industries.
If you compare the financial performance of all four companies. Supreme Industries is the best placed among all the other four. Supreme Industries has the highest ROE and ROCE and the lowest debt in the segment.
For FY23, Supreme Industries has planned a CapEx of about ₹ 700 Cr. The CapEx has been funded from internal accruals. This will upgrade the manufacturing facility by 15% YoY to 8.3 lakh tonnes.
Moreover, the management has also guided for more than 25% YoY blended volume growth, a revenue of ₹ 9000 Cr and margins of 12.5% in FY23.
Fundamentally the company is strong!
The company is on the verge of breaking the resistance. One can buy if it breaks the resistance and retests.
Here are a few major announcements for the Budget 2023:
Relief to taxpayers: Income limit for the rebate of Income Tax now ₹ 7 Lakhs, new tax slabs as default.
₹ 10 Lakh Crores to be put into the development of new roads, bridges, ports etc. (Capital Expenditure).
Largest historical allocations to Ministry Education, Health and Family Welfare, Indian Railways.
New schemes launched by Govt- MISHTI (for mangrove plantation in coastal areas), PRANAM (goal of reduction of usage of chemical fertilizers), and SAPTRISHI.
A new investment instrument – Mahila Samman Saving Certificate, which offers a deposit of up to ₹ 2 Lakhs in the name of a woman or girl child, for a tenure of 2 years, at a fixed Interest Rate of 7.5%, with partial withdrawal available. (Must read for our subscribers who just have become parents).
Some exciting research coming up in the next issue…
Which among the following is the world’s largest derivative exchange?
Answer to Quiz Week #2 is 4
**Make sure you note your choices somewhere as we’ll covering the answers in our next issue…
CapEx: CapEx or Capital expenditure, means the amount utilised by an organization, firm or nation to upgrade its assets, or maintain or purchase physical assets. In simple words funds are used by the company to set up new plants, and install or maintain machinery, equipment or technology. For a nation, these assets are buildings, roads, railways, defence, metro, housing etc.
We have started this section specially for you, just to cater to your requirements!
This week: Devansh
Topic: Fundamental Analysis of EID Parry
After Shree Renuka Sugars Ltd., it is the second largest shareholder in the sector as per market cap and has expertise and experience in catering to customized needs.
Market Cap Segmentation of Sugar Sector
ROCE past 5 years > 14%.2. (14.2% is Annual CAGR return of Nifty50 from 30.06.99 – 15.12-21).
Free Cash Flow is present for the last 5 years.
The company has limited debt and repaid it consistently in the last 5 years to reduce the interest.
Promoter Holding is good, with Promoter shareholding greater than the public.
Stock PE < Segment PE and below 200 MA, thus undervalued.
The EPS trend is a little inconsistent but has positive values througout.