Photo by Naveed Ahmed on Unsplash

Indian share markets extended gains as the session progressed and ended on a strong note.

Benchmark indices extended its rally for the third day aided by strong global cues and positive RBI policy.

The Reserve Bank of India's (RBI) first monetary policy for the calendar year 2022 kept key policy rates unchanged and continued with its accommodative stance to support growth.

This was the tenth straight policy when the repo rate was left unchanged at 4% and the reverse repo rate at 3.35%.

While the RBI decided to roll back some of the operational measures pertaining to the liquidity framework - announced when the coronavirus (Covid-19) pandemic struck two years ago - the tone of the policy remained more dovish than what was expected resulting in bond and stock prices surging.

At the closing bell, the BSE Sensex stood higher by 460 points (up 0.8%).

Meanwhile, the NSE Nifty closed higher by 142 points (up 0.8%).

Tata Steel and ONGC were among the top gainers today.

Maruti Suzuki and IOC, on the other hand, were among the top losers today.

The SGX Nifty was trading at 17,604, up by 120 points, at the time of writing.

The BSE Mid Cap index and the BSE Small Cap index ended up by 0.3% and 0.1%, respectively.

Sectoral indices ended on a positive note with stocks in the metal sector, banking sector and power sector witnessing buying interest.

Shares of GMDC and Gujarat Narmada hit their respective 52-week highs today.

Asian stock markets ended on a positive note today.

Both, the Hang Seng and the Nikkei ended up by 0.4% in today's session, while the Shanghai Composite ended up by 0.2%.

US stock futures are trading on a flat note today with the Dow Futures trading up by 17 points.

The rupee is trading at 74.94 against the US$.

Gold prices for the latest contract on MCX are trading up by 0.1% at Rs 48,684 per 10 grams.

In news from the auto sector, M&M was among the top buzzing stocks today.

Auto major Mahindra and Mahindra (M&M) reported a 57% surge in third-quarter profit, boosted by higher demand for the automaker's commercial vehicles and farm equipment that offset an increase in costs due to supply chain disruptions.

Consolidated net profit from continuing operations was Rs 19.9 bn for the quarter ended 31 December 2021, up from Rs 12.7 bn a year ago.

Revenue from operation increased 9% to Rs 235.9 bn for the third quarter against Rs 216.3 bn in same quarter of last year.

'We have seen improved performance across multiple businesses as reflected in our consolidated performance. Our auto business has done well despite supply side challenges while our farm business has shown market share increase despite a slowdown in the market,' said M&M MD and CEO Anish Shah.

On a standalone basis, M&M's net profit rose over two-fold at Rs 13.5 bn for the December quarter.

The company said commodity inflation, shortage of semi-conductors has impacted the operating margin which stands at 11.9%.

Mahindra said there is continued growth in exports both for auto and farm and the quarter saw improved group company performances at Mahindra Finance and Mahindra Lifespaces.

Meanwhile, the volumes in terms of total vehicles sold during the quarter fell 2% to 1,18,174, while the tractor volumes declined 9% to 91,769.

M&M share price ended the day up by 1.5% on the BSE.

Moving on to news from the energy sector...

Reliance Industries to Acquire Stake in EV Technology Firm Altigreen

Reliance Industries today announced the acquisition of a stake in electric vehicle (EV) technology and solutions company Altigreen Propulsion Labs for Rs 501.6 m.

'Reliance New Energy (RNEL), a wholly-owned subsidiary of the company, has entered into an agreement with Altigreen for the subscription of 34,000 Series-A Compulsorily Convertible Preference Shares of face value Rs 100 each for an aggregate consideration of Rs 501.6 m,' Reliance said in a stock exchange filing.

The company did not say how much equity shareholding will it get against the investment.

The transaction is proposed to be completed before March 2022.

Based out of Bengaluru, Altigreen is an electric vehicle technology and solutions company for commercial last-mile transportation through 2/3/4 wheeled vehicles.

It has developed an electric 3-wheeler vehicle, and its vehicles are built in-house in Bangalore on a mobility platform that is 100% indigenous.

Its current patent portfolio spans 60 countries with 26 global patents, the firm said, adding some of Altigreen's current technologies include electric motors and generators, vehicle controls, motor controls, EV transmissions, telematics & IoT and battery management.

'The investment is part of our company's strategic intent of collaborating with innovative companies in new energy and new mobility ecosystems,' it said.

Altigreen is a private limited company incorporated in India on 8 February 2013. It had a turnover of Rs 10.4 m in 2020-21.

The transaction will not require any government or regulatory approval, the firm added.

Reliance Industries share price ended the day down by 0.4% on the BSE.

Speaking of EVs, have a look at the chart below which shows the massive opportunity in the two-wheeler EVs.

(Click on image to enlarge)

Here's what lead Smallcap Analyst at Equitymaster, Richa Agarwal wrote about this in a recent edition of Profit Hunter:

• In the last five years, two-wheeler sales in India were around 2 crore units per year. Now the sector is cyclical and has been in the downturn for some time. So let's consider a moderate 5% growth for the next 10 years.
• By 2030, we are looking at 2-wheeler sales of 3 crore units. Even if one third of this is EV sales, that's 1 crore electric 2-wheelers per year.
• In the last 2 years, average electric 2-wheeler sales were 1.5 lakh units. From 1.5 lakh to 1 crore, that's a 66x opportunity in 2-wheeler EVs.
• This is an annual growth rate of 52% over next 10 years. It's an almost vertical growth opportunity.

As per Richa, this is like a gold rush. But like in any gold rush, the winners will just be a few.