Metal, PSU Bank, realty stocks rule Samvat 2077—Experts decode what worked for these sectors

The Indian share market has been on a dream run. Despite a few minor corrections recently, the stock market has given unprecedented returns in the last one year. The same was reflected in the indices that outperformed equity benchmarks Nifty 50 and S&P BSE Sensex. The maximum rally was witnessed in metal, PSU bank and realty space. During the last one year as on November 2, 2021, the Nifty indices belonging to these sectors surged over 100 per cent.

Nifty Metal soared 141 %, Nifty Realty 127, while Nifty PSU Bank clocked 128 per cent during this period, outperforming benchmark indices by a wide margin, showed data with Stock Edge, an app to analyse NSE and BSE data. Similarly, S&P BSE Metal, S&P BSE Realty and BSE-PSU indices too yielded 147%, 129% and 91 %return as on November 2, 2021, as per the same data. The Nifty gained 53% and Sensex saw 51% jump in the same time period.  

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Clearly, the Samvat 2077 belonged to metal, PSU bank and realty stocks.  

What expert makes of rally in these sectors

However, it was the metal stocks that stole the show with massive return in the past one year. Adani Enterprises, SAIL, NALCO, Tata Steel and Vedanta all supported Nifty Metal with over 200 per cent returns. Adani Enterprises led the pack with 332% return till November 2.  

Talking about the stellar show by metal stocks, Gaurav Garg, Head of Research at CapitalVia Global Research, said, "The metal sector seems to have entered the positive phase of the cycle, aided by positive stimulus across the economies and reviving economic activities also has impacted infrastructure and therefore, the overall sector outperformed after a lackluster phase," observed Gaurav Garg.  

Talking about good show by PSU banks, CapitalVia Head of Research said, PSU Banks were heavily burdened with NPAs, however, in the past Samvat (2077), the trend of bad loans seems to have at least stalled if not declined. "The good quarterly results and the relief for telecom sector seems to have worked well for PSU Banks," he said. Among the PSU banks, The Jammu & Kashmir Bank emerged as lead gainer with 207% return till November 2,2021. Others that pushed the PSU bank index were Indian Bank, State Bank of India, Canara Bank and Indian Overseas Bank with return of 135% to 196%  

Meanwhile, in realty sector, stocks such as Indiabull real estate, Soha Ltd, Brigade Enterprise, DLF Ltd and Oberoi Realty were top gainers, which yielded return between 120% to 270% in the same duration. "Realty sector has also seen a great deal of interest with increased activity in infra and favourable valuations of properties. In the upcoming Samvat, we expect these sectors to be in limelight and we expect these sectors to go further north," said the market expert.  

What worked for markets since last Diwali ?

Talking about top reasons that lifted the market sentiment from last Diwali, Aishvarya Dadheech, Fund Manager, Ambit Asset Management, said, "The market has delivered broad-based return since Diwali 2020, with Nifty 50 climbing 41% and Nifty 500 witnessing 47% jump." 

He said this movement has been supported by built in earning traction as the economy gradually recovers from the lows of Covid induced lockdown. 
"Abundant liquidity, alongside lower interest rate was the enablers for market optimism. We also witnessed increased retail participation in the market, which supported the broader market in a big way. FIIs also invested heavily over the last one year, as India seems to be better positioned from growth and recovery perspective, among all the developing markets," said Aishvarya Dadheech.