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Market at all-time highs: Takeaways from India Inc's Q3 performance so far

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Markets are at all-time highs and with two months of the third quarter behind us, CNBC-TV18’s Prashant Nair decided to put together the latest commentary and data points coming from the top corporates across eight sectors. The exercise avoids high-frequency macro data and sticks with corporate data points.

Markets are at all-time highs and with two months of the third quarter behind us, CNBC-TV18’s Prashant Nair decided to put together the latest commentary and data points coming from the top corporates across eight sectors. The exercise avoids high-frequency macro data and sticks with corporate data points.
To start with, the country top car maker - Maruti - is now back at 100 percent capacity utilization versus 77 percent in the last quarter. The management told CNBC-TV18 that retail sales are up 70 percent in November and that they grew faster than wholesale numbers.
On to tractors, which is indicative of rural demand. Sales in November grew 55 percent for Mahindra and Mahindra (M&M) and 31 percent for Escorts.
What about trucks and commercial vehicles? CNBC-TV18 reported yesterday that shortage of trucks is leading to increase in freight rates across many sectors like fast moving consumer goods (FMCG), food, infrastructure etc. The Ashok Leyland management has said that truck segment demand is coming back due to movement in sectors like cement and steel.
In aviation, the market leader Interglobe Aviation (IndiGo) has now reached 70 percent of its pre-COVID capacity with 1,000 daily commercial flights. IndiGo had guided for 60-70 percent pre-COVID capacity by Q3.
Real estate stocks have been on a tear. DLF claims to have sold out its newly launched plotted development in Gurgaon with the company recording pre sales of Rs 300 crore.
Old economy space cement has been tepid stock performance wise but the Shree Cements management told CNBC-TV18 that demand across India is very strong with stronger demand in rural India.
No such problems for steel companies which continue hikes into December. Cumulatively, since the bottom in June/July, hot-rolled coil (HRC) prices in India have moved up Rs 12,000-13,0000/tonne.
News reports suggest that festive demand for premium products was ahead of expectations. Also, while this data is two months old, smartphone sales in Q2 have recovered to pre-COVID levels, up 180 percent on a quarter-on-quarter (QoQ) basis.
The momentum in management commentary has been quite positive with two months of the quarter behind us but with price to earnings multiples for Nifty at new highs, the question and the trick is to figure out what is priced in.
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