M&M, VW Deal Delayed

Aaj Ka Bazaar

After last Friday's sell-off, the US market rebounded during trading on Monday. The Nasdaq and S&P 500 ended higher on Monday, recovering some losses as investors looked forward to upcoming quarterly earnings from AI leader Nvidia. Tesla saw an increase in its stock price based on the potential for favorable policy changes from the incoming Trump administration. In the Asia-Pacific region, markets rose on Tuesday, following the gains seen on Wall Street, even as investors analyzed discussions with Chinese financial policymakers at an investment summit in Hong Kong. The Indian market is expected to open higher on Tuesday morning, mirroring cues from Wall Street, where stocks experienced an upswing due to bargain hunting after last week's significant drop. However, with the close of the Q2 earnings season and ongoing selling by foreign institutional investors, the market will consolidate within a broad range without positive triggers. Additionally, the Rs. 10,000 crore IPO of NTPC Green Energy is set to open for subscription later today.

Markets Around Us?

BSE Sensex - 78,076.27 (0.95%)

Nifty 50 - 23,737.85 (1.21%)

Bank Nifty - 50,881.10?(1.03%)

Dow Jones - 43,494.36 (0.25%)

Nasdaq - 18,782.89 (0.55%)

FTSE - 8,109.32 (0.56%)

Nikkei 225 - 38,496.86 (0.69%)

Hang Seng - 19,640.74 (0.33%)

Sector: Automobiles

JV talks between M&M and Skoda-VW hits road bump

Talks between Mahindra & Mahindra (M&M) and Skoda Auto Volkswagen India for a potential 50:50 joint venture have hit a roadblock, with disagreements over key matters. Both companies had signed nonbinding agreements earlier and planned to finalize crucial ones by this month, but discussions have slowed. The joint venture, if it materializes, would focus on the Skoda and Volkswagen brands, helping VW leverage M&M’s cost-effective development and sourcing capabilities. The partnership could provide synergies and potentially capture nearly 20% of the Indian passenger vehicle market. For M&M, known for its SUVs like XUV700 and Scorpio N, the deal offers access to advanced VW technologies and additional manufacturing capacity, including Skoda-VW’s 200,000-unit facility in Pune. However, M&M, now financially strong with ?19,000 crore in cash, is cautious about compromising on costs and sourcing. Skoda-VW India is also seeking more capital from its parent to strengthen its position in the Indian market.

Why it Matters:

For M&M, a failure to secure the partnership may limit short-term technology access, while for VW, it could mean continued struggles in gaining a significant foothold in India’s growing auto market. Investors will keenly watch for updates on the JV and its potential synergies to gauge future growth trajectories.

NIFTY 50 GAINERS

ONGC - 252.35?(3.15%)

ADANIPORTS - 1,319.25?(3.12%)

M&M - 2,934.80?(3.09%)

NIFTY 50 LOSERS

HDFCLIFE - 683.95 (-0.95%)

RBAJAJFINSV - 1,607.90 (-0.50%)

HINDALCO - 647.90?(-0.48%)

Sector: Animal Feed

Godrej Agrovet to provide sustainable crop solutions with Provivi

Provivi, a global crop protection firm, has partnered with Godrej Agrovet Limited (GAVL) to introduce sustainable pest control solutions for Indian rice and corn farmers. GAVL will exclusively commercialize Provivi’s YSB Eco-Dispenser to combat Yellow Stem Borer in rice and FAW Eco-Dispenser for Fall Armyworm in corn, both leveraging eco-friendly pheromone-based technology. These tools aim to reduce pests while being environmentally sustainable. Highlighting the collaboration, the management emphasized the importance of innovative pest solutions amid rising challenges due to climate change. Provivi management highlighted India’s agricultural growth as a key opportunity for expansion. The products, developed using biodegradable materials for long-lasting efficacy, will launch in 2029. With a robust presence across agriculture, dairy, and animal feed segments, GAVL aims to leverage its extensive network to deliver advanced solutions for rice and corn crops, vital to India’s food security and economy.

Why it Matters:

From an investor's perspective, the partnership reflects GAVL's commitment to addressing the challenges of climate change and increasing agricultural productivity. This could translate into greater market penetration, improved revenue streams, and a bolstered brand image, positioning GAVL as a resilient and future-ready player in the agribusiness sector.?

Around the World

Most Asian markets gained on Tuesday, driven by strong performance in local tech stocks following a rally in U.S. tech giants like Tesla. However, Chinese shares lagged as investors awaited the People’s Bank of China’s decision on its loan prime rate later this week, which is expected to remain unchanged after October’s cut. Recent Chinese stimulus measures and economic data have disappointed, with inflation showing weak growth. Hong Kong’s Hang Seng index rose 0.4%, led by tech, though Xiaomi dipped 2% on EV losses. Japanese markets were supported by tech gains and a weaker yen, with inflation data due later this week. South Korea’s KOSPI rose 0.2%, while Australia’s ASX 200 led with a 1.1% jump on strong mining and energy stocks. Indian markets are expected to open higher, recovering from recent steep losses that saw the Nifty 50 enter correction territory after dropping over 10% from record highs.

Option Traders Corner

Max Pain

Nifty 50 - 23,700

Bank Nifty - 51,000

Nifty 50 - 23,470 (Pivot)

Support - 23,333, 23,213, 23,077

Resistance - 23,590, 23,726, 23,846

Bank Nifty - 50,294 (Pivot)

Support - 50,143, 49,922, 49,771

Resistance - 50,515, 50,666, 50,886

Have you checked our latest Brand Ad

Did you know?

Merchandise exports head north

India’s merchandise exports in October 2024 stood at $39.2 B, up from $34.58 billion in September, and $33.43 billion a year earlier, led by pharma, electronics and engineering goods.

Disclaimer