Shriram EPC, Kingfa Science, Jaiprakash Power Ventures among top stocks which rallied up to 65% last week

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More than 500 stocks on the BSE delivered double-digit returns to investors last week despite some selling in the domestic equity market. The benchmark BSE Sensex declined around 474 points or 0.96% to 48,732 for the week ended May 14. Likewise, the NSE Nifty index settled 145.35 points, or 0.98%, down at 14,678.

With a rally of 65%, Shriram EPC emerged as the top gainer on the exchange. Shares of the company jumped to Rs 6.76 on May 14 from Rs 4.10 on May 7. Aditya Consumer Marketing (up 59%), Ambalal Sarabhai Enterprises (up 47%), Kirloskar Electric Company (up 46%), Sagar Diamonds (up 41%) stood among other top gainers of the week.

Overall, market sentiment turned pessimistic last week on worries that accelerating US inflation could lead to interest rate hikes sooner than expected. Earnings in Q1FY22 will be lower than initial estimates due to extensions of lockdowns in many states, also weigh down sentiments. The Maharashtra government has extended the lockdown-like restrictions in the state till June 1 to break the chain of Covid-19.

Nandan Denim, Kingfa Science & Technologies, Chaman Lal Setia, Venky’s India, Vikas EcoTech, Gufic Biosciences, Siti Networks, Jaiprakash Power Ventures and Stovec Industries stood among other players which rallied more than 30% last week.

Nifty top gainers

UPL: Shares of UPL rallied 18% to Rs 743.30 last week. The company hogged the limelight after its reported 73.59% growth in consolidated net profit at Rs 1,361 crore for March quarter 2020-21. The company’s net profit stood at Rs 784 crore in the year-ago period.

Asian Paints: The paint major was another top gainer in the Nifty pack. The scrip jumped 8.73% to Rs 2774.50 last week. Brokerages have retained their bullish view on the company after it reported an 81.13% jump in its consolidated net profit to Rs 869.89 crore for the fourth quarter ended March 31, aided by volume growth in the domestic as well as in the international market. UBS has set a price target of Rs 3,350 for Asian Paints post Q4 results.

Analyst views

Vinod Nair, Head of Research at Geojit Financial Services:

Global equity markets traded low this week in anticipation of high inflation and future interest rate hike in the US, due to rising commodity prices. However, the US Fed Reserve officials eased interest rate jitters claiming there would be no imminent move to tighten the monetary policy. This has helped the global markets to regain its optimism and close the week on a positive note. The domestic sectoral front was impacted by a weak global market and metal stocks witnessed profit booking, snapping its upward rally. With the decline in food prices, April’s retail inflation eased to 4.29%, which is positive and can help in the movement of the banking sector, in the near term.

Factors to watch

In the coming week, the market is expected to have a stock-specific rally based on the forthcoming results. The effectiveness of vaccination in curbing Covid spread will be a key in determining the long-term trend in the market. International metal prices are high compared to actual economic activity, this can impact metals stocks.

Going ahead, market participants will be eyeing the important result announcements starting Bharti Airtel, Federal Bank, Rane Brake Lining, Manappuram Finance, Route Mobile, Tata Motors, Tata Motors, Indiabulls Housing Finance, SML Isuzu, PI Industries, Subex, Aarti Industries, Indian Oil Corporation, JK Tyre, Bosch, Havells India, Relaxo Footwears, Godrej Industries, Hindalco Industries and Shree Cement, among others.