The first week of this earnings season was a mixed bag. While the two big names, Infosys and Bajaj Auto, expectedly delivered lukewarm news, some mid-caps sparkled. The second week, starting on Monday, is a much bigger week on the earnings calendar.
Perched at these lofty levels, the news flow this week has to be good to keep the market firing on all cylinders.
Sector bellwethers like DLF, Larsen & Toubro and ACC are due with their numbers. DLF’s figures will be crucial to whether this sector can continue to be re-rated upwards by the market.
This is the company’s first quarterly reporting post listing; if the management can declare a set of earnings that justifies the street’s expectation of close to Rs 6,000 crore of profit this year, the stock could run up even from here and take the sector with it.
Infrastructure is the sweetest spot in the market now and Larsen & Toubro is the bellwether here. Any positive surprise will be lapped up to further fuel the frenzy in this sector.
Cement stocks have come out of their shell in the last fortnight, particularly ACC, and investors would want to see a thumping set of numbers and confident business outlook from the company.
Most major information technology companies will deliver their results this week. Since expectations for this quarter are muted and TCS and Wipro do not give any specific annual guidance, there may not be any great surprises lurking here. However, the street will be watching the numbers from mid-cap infotech closely--the likes of Polaris, Sonata, Geometric and KPIT--to decide whether there can indeed be a case for mid-caps to outperform large-caps in this sector.
As has been the case so far. Finally, a word on mid-caps. In the current market scenario they are every bit as important as index stocks. Do keep an eye out for the likes of Voltas, IDBI Bank and HOEC this week, as the traders’ antennae will be up for any surprises in this space.
The primary market has livened up, too, and the oversubscription in recent issues like Everron and Allied Digital has been staggering.
IPO investors and traders will be waiting for Spice Tele’s listing this week with bated breath. It was subscribed 37 times and there could be some fireworks on listing.
It is shaping up like an interesting week ahead: all-time highs, lots of earnings and stock-specific news. What more can one ask for?
(The writer is Executive Editor, CNBC-TV 18)