Stock Market: Stock picking gains pace; population theme plays out

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By S Jha

New Delhi, April 20: A day after the United Nations in its mid-2023 assessment stated that India marginally edges past China in population, the theme played out on the Dala Street. More population, as projected by the UN, would need additional demands for basic necessities, and the investors chased stocks which could gain from India’s rising population.

The two sectors which reacted strongly on a day when the indices stayed in the sideways mode were footwear and textile. Both the segments had been beaten down in the recent months. Textile sector has in particular been severely punished after China reopened its economy.

Mirza International remained locked in the upper circuit. The company, which besides own brands, is also a contract manufacturer for several international brands, had come down to the level of Rs 35 a few days ago after the demerger with Red Tape. Now Mirza International is locked in the upper circuit at about Rs 56.

The likes of Liberty Shoes and Khadim raced to hit almost 20 per cent circuit. There are several listed footwear companies and they all reacted positively on Thursday. Campus Activewear, the most recent IPO from the footwear industry, which has way down from its peak, marginally rose during the secular rally.

Among the textile companies Lux Industries and Rupa reacted with handsome gains. For the footwear and textile, particularly the innerwear manufacturers, the business model is simple – more the people, more is the revenue. Even Lovable Lingerie gained big on Thursday. The rally in the textile sector was clearly showing bias for the innerwear manufacturers, which are known to have high margins and low cost.

But the investors were picking the smallcaps and midcaps in a big way, which was evident from the price action. Mastek, a midcap IT company, reacted positively to its quarterly result to make strong gains.

Rally in the smallcaps such as KPI Energy, playing out on renewable energy theme, as G7 in its Japan meeting reiterated commitment for the energy transition. Data Patterns, the private defence player, made strong gains to even hit the mark of Rs 1748 during the day to close at Rs 1692 a piece.

Marine Electrical, which broke out from the level of Rs 41 a few days ago maintained its bullish run amid the anticipation that the company is gaining from the orders from the PSU shipyard companies.