Markets Struggle for Direction as IT Slips; Nifty Holds Steady Above 25,500

Market Overview

The markets opened on a positive note but struggled to maintain momentum as the session progressed. Nifty 50 managed to close slightly higher, supported by select banking and financial stocks. However, the real drag came from the IT sector. After showing early strength, tech stocks reversed course, pulling the market down. The IT drag market theme clearly defined today’s trading mood, with the Nifty IT index slipping by over 149 points.

While Bank Nifty showed relative strength and midcaps were largely flat, smallcaps experienced mild profit booking after last week’s rally.

In today’s newsletter, we cover:

• Nifty Outlook – Key support and resistance levels, plus potential setups
• News Spotlight – Detailed coverage of the Textile PLI Scheme news and its impact on textile-linked stocks
• Top News Events – From Raymond Realty’s stock market debut to Alembic Pharma’s USFDA approval
• High-Risk, High-Reward Trade – Technical setup for RTNPower with strategy breakdown
• IPO Tracker – Subscription status, GMP trends, and major upcoming listings
• Smallcap of the Day – Business deep dive into Signpost India Ltd
• Wrap-Up & Strategy View – Key takeaways from the session and what to watch next

Let’s break it down section by section.

Nifty Outlook: IT Drag Market Stalls Index Move

Market Context:
NIFTY 50 remains firmly in its primary uptrend, continuing the strong bullish momentum seen over recent weeks. The index broke above its previous consolidation range of 25,200–25,300 and has sustained this breakout, a key signal of strength. However, today’s session reflected some hesitation as the IT drag market narrative played out. While financials held ground, weakness in IT stocks capped further gains for the index.

Current Price Action Snapshot:

• Last Close: 25,541.80 (+0.10%)
• Day’s High / Low: 25,593.40 / 25,501.80
• Short-Term EMA (9-period): 25,220.73
• Volume: ~260 million (slightly below 20-day average)
• Structure Insight: Mild upper wick on the daily candle suggests selling pressure emerging near the highs.

Technical Breakdown:

1. Trend & Momentum

• Trend: The long-term trend is intact with consistent higher highs and higher lows.
• Momentum: Bullish, though slightly fading near the resistance around 25,670. Price is still comfortably above the 9-day EMA, a sign of ongoing strength.

2. Support Levels

• Immediate Support: 25,220 – aligned with the short-term EMA and the recent breakout zone.
• Secondary Support: 25,050 – marks the lower boundary of the consolidation structure.
• Major Support: 24,460 – mid-June swing low and a crucial structural demand area.

3. Resistance Levels

• Immediate Resistance: 25,670 – recent rejection zone.
• Psychological Resistance: 26,000 – round number and sentiment level.
• Major Target: 26,260 – projected target from the breakout structure.

4. Volume Observation

• Volume has slightly declined despite price pushing higher, hinting at caution among buyers.
• No reversal patterns are present yet, keeping the bullish structure valid.

Trade Setups & Scenarios:

Bullish Continuation (Base Case):
If NIFTY sustains above 25,670 with stronger volume:

• Target 1: 26,000
• Target 2: 26,260
• Invalidation: Close below 25,220

Pullback Scenario (Alternate View):
If the index faces rejection and cannot close above 25,670:

• Pullback Zone: 25,220–25,050
• Trend Bias: Still positive above 24,460
• Opportunity: Buy-on-dip setups into support zones

Institutional Perspective:

Despite today’s IT drag market impact, the broader setup remains intact. Institutions are likely watching the 25,200 zone for support, with a preference to accumulate on dips or breakouts above 25,700 with volume.

Final Word:

The NIFTY 50 continues to exhibit strength, but the upside is currently tempered by sectoral rotation, particularly the underperformance in IT. Traders should remain cautiously optimistic, using the 25,200–25,250 zone as a key retest level. A decisive breakout above 25,670 will confirm momentum toward 26,260. Manage risk below 25,050.

Sectoral News: Resilience Beyond IT Drag Market

1. Hindustan Power Wins 100 MW Solar + 200 MWh Battery Storage Project

What Happened:
Hindustan Power secured a prestigious inter-state transmission system (ISTS) project from SJVN Ltd. This includes a 100 MW solar PV project and a 200 MWh battery energy storage system (BESS), enabling backup supply for up to 4 hours. This marks a step towards stabilizing India’s renewable energy grid.

Why It Matters:

• Battery storage is vital for managing peak demand and ensuring grid reliability during non-sunny hours.
• The project is part of a larger 1,200 MW capacity rollout, emphasizing India’s transition to clean energy.
• It strengthens Hindustan Power’s leadership in renewable energy and positions it well for future government-linked clean energy contracts.

Watchlist Stocks:

• SJVN Ltd. – Key client and government-linked execution partner.
• Reliance Industries – Active in solar module manufacturing.
• Tata Power, NTPC, JSW Energy – Renewable-focused utilities likely to benefit from battery+solar deployments.

2. Shadowfax Technologies Files for ₹2,500 Cr IPO

What Happened:
Logistics tech firm Shadowfax Technologies confidentially filed draft papers for a ₹2,000–2,500 crore IPO with SEBI. The issue will comprise both fresh equity and offer-for-sale by existing investors. It was last valued at ₹6,000 crore and is targeting ₹8,500 crore for this IPO round.

Why It Matters:

• Shadowfax is a key last-mile delivery player in India’s growing e-commerce logistics space.
• Proceeds will help boost capacity and expand network coverage.
• This IPO reflects renewed investor appetite for tech-enabled logistics plays after a pause in startup listings in 2023–24.

Watchlist Stocks:

• Delhivery, Blue Dart, Mahindra Logistics – Existing logistics players that may re-rate post-IPO activity.
• TCI Express – Strong performer with lower risk exposure.

3. Skyways Air Services Files IPO to Raise Funds & Cut Debt

What Happened:
Skyways Air Services, a key air cargo and supply chain provider, filed draft IPO papers for a fresh issue of 32.9M shares and an OFS of 13.3M shares. Proceeds will be used for debt repayment and capital expenditure.

Why It Matters:

• Rising global and domestic air freight demand is pushing players to expand their fleets and warehousing capacity.
• Skyways is eyeing debt reduction and capex — a growth strategy that could reflect well in earnings over time.
• A successful IPO could lead to valuation rerating in the logistics and air freight segment.

Watchlist Stocks:

• Blue Dart, SpiceJet (cargo arm), Gati, Container Corporation of India – Beneficiaries of logistics sector growth.
• Tata Steel Long Products – Indirect benefit from freight-driven infrastructure expansions.

4. Nuvama Ups Target for RIL to ₹1,801 on Solar Module Push

What Happened:
Nuvama has issued the highest target yet on Reliance Industries at ₹1,801, citing its solar ambitions. RIL recently inaugurated a 1 GW HJT module facility, scalable to 10 GW by early 2026. Analysts see this as a repeat of the Jio-led rerating that propelled RIL post-2017.

Why It Matters:

• Entry into solar modules could make RIL a dominant player in India’s renewable supply chain.
• Government support for local manufacturing may give it an edge amid import substitution policies.
• Solar and clean energy is becoming a significant leg in RIL’s new business portfolio.

Watchlist Stocks:

• Reliance Industries, Adani Green, Tata Power, Waaree Renewables
• Inox Wind, Borospan Solar – Players in module and EPC space.

5. CG Power Plans ₹3,000 Cr QIP Amid Large Order Wins

What Happened:
CG Power is planning to raise ₹3,000 crore via Qualified Institutional Placement (QIP). The price band is expected around ₹660/share. This comes after a ₹641 crore order from Power Grid Corp.

Why It Matters:

• Fresh capital through QIP strengthens balance sheet for future growth.
• Recent large orders show strong execution pipeline.
• Part of broader capex cycle in the Indian electrical equipment sector, benefiting from infra push.

Watchlist Stocks:

• CG Power, KEC International, ABB India, Siemens, BHEL

6. EMS Sector Poised for Explosive Growth: Dixon, Kaynes in Focus

What Happened:
According to market expert Narendra Solanki, the Electronic Manufacturing Services (EMS) sector in India will be a multiyear growth story. Companies like Kaynes Technology, Dixon, and CG Power are direct beneficiaries, while PG Electroplast and Epack Durable are key ancillaries.

Why It Matters:

• High government focus via PLI schemes is driving capex in this segment.
• Shift from low-margin to high-margin electronics (like EV components, LED, IoT) may significantly expand profitability.
• Domestic production substitution also boosts volumes.

Watchlist Stocks:

• Dixon Technologies, Kaynes Technology, PG Electroplast, Epack Durable, Syrma SGS

7. Govt Approves ₹1,853 Cr Road Project + ₹1L Cr Innovation Scheme

What Happened:
The Union Cabinet cleared:

1. ₹1,853 crore for 4-laning of Paramakudi–Ramanathapuram highway
2. ₹1 lakh crore Research Development and Innovation Scheme
3. A ₹1 lakh crore employment-linked incentive scheme

Why It Matters:

• National highways boost logistics and connectivity in Tamil Nadu’s industrial hubs.
• Innovation scheme aims to stimulate tech R&D, startups, and new product creation.
• Employment-linked incentives could benefit large-scale manufacturers.

Watchlist Stocks:

• IRB Infra, PNC Infratech, L&T, HG Infra – Infra beneficiaries
• Tata Elxsi, LTTS, Persistent Systems – Innovation-linked R&D plays
• Maruti Suzuki, Hero MotoCorp, M&M – Job-creating manufacturing players

8. Platform Fees Surge Across Zomato, Swiggy, BigBasket, Zepto

What Happened:
Handling and platform fees across food delivery and quick-commerce platforms are quietly rising. Fees now range from ₹9 to ₹15 per order, up from ₹2–₹5 a year ago. Companies claim minimal user churn despite the hikes.

Why It Matters:

• Indicates platforms are transitioning from growth to monetization mode.
• Could improve margins and profitability in next 2–3 quarters.
• Raises questions about consumer stickiness and potential regulatory oversight.

Watchlist Stocks:

• Zomato, Info Edge, Delhivery, Jubilant FoodWorks, Nestle – Consumer tech & food delivery ecosystems

Stock on Technical Radar – IDFCFIRSTB

IDFCFIRSTB – Technical Analysis Overview

Closing Price: ₹77.24
Volume: 129 million shares (vs 20-day avg ~35 million) – a major surge indicating strong breakout momentum.

Chart Structure & Breakout Insight

Despite broader index-level resistance due to the IT drag market, IDFCFIRSTB has displayed relative strength. It decisively broke out of a long-standing horizontal resistance between ₹75.90–₹76.00, which had capped prices since May 2024.

The stock also retested and bounced off a downtrend line stretching from the November–March series, completing a classic breakout structure with bullish continuation potential.

Volume Analysis

• Today’s breakout occurred on the highest volume in over a year.
• Indicates strong institutional or high-conviction buying – a hallmark of genuine breakouts.
• Volume spike supports sustainability of the move even amidst sector-specific drags elsewhere in the market.

Key Technical Levels

Zone	Level (₹)	Significance
Immediate Support	75.90–76.00	Previous resistance turned into support
Minor Support	74.70	Last swing high and structural pivot
Confluence Support	71.40–69.80	9 EMA + trendline zone
Immediate Resistance	84.50–84.80	Supply zone from previous consolidation highs
Swing Target Zone	83.50–84.80	Based on pattern height and prior resistance
Suggested Stop Loss	74.00	Structural invalidation below this point

Trading Playbook

Short-Term Strategy (1–5 Days)

• Approach: Momentum breakout
• Entry Zone: 76.00–77.00 (preferably on intraday dips)
• Target: ₹80.00
• Stop Loss: ₹74.70
• Risk-Reward: ~1:2

Swing Strategy (1–3 Weeks)

• Approach: Volume-backed breakout
• Entry: Current levels or dips to ₹75.90
• Targets: ₹80.00 (short-term), ₹84.50–₹84.80 (extended)
• Stop Loss: ₹74.00
• Risk-Reward Potential: >1:3 on extended holding

Technical Indicator Summary

Indicator	Status
Trend (9 EMA)	Bullish – price trading well above EMA
Volume	Extremely bullish – breakout confirmed
RSI Estimate	Likely above 70 – typical in fresh breakouts
Chart Structure	Combination of ascending triangle and cup-with-handle base

Professional Take

Amidst market-wide hesitations led by the IT drag market, IDFCFIRSTB stands out with strength. It has broken through a year-long resistance with conviction-backed volume, suggesting a bullish continuation toward ₹80–₹84.

A pullback to ₹75–₹76 remains a favorable entry point for both short-term and swing traders. With clear structure, trend strength, and confirmation from volume, this trade setup presents a high-probability opportunity — especially in contrast to sectors showing fatigue.

Note: This is not investment advice. Please do your own research. We are not SEBI-registered advisors.

IPO Update: Amid IT Drag Market, Broader Investor Appetite Remains Resilient

While the broader markets faced hesitation due to the IT drag market, the IPO scene—especially in the SME segment—continued to attract robust investor interest. Below is a snapshot of recent and ongoing IPOs along with their estimated listing gains based on the latest GMP data:

Mainboard & SME IPOs – GMP Snapshot & Listing Outlook

IPO Name	GMP (₹)	Issue Price (₹)	Est. Listing Price (₹)	Listing Gain (%)
Adcounty Media India	50	85	135	58.82%
Ace Alpha Tech	26	69	95	37.68%
Neetu Yoshi	25	75	100	33.33%
Moving Media Entertainment	25	70	95	35.71%
Suntech Infra Solutions	33	86	119	38.37%
Sambhv Steel (Mainboard)	13	82	95	15.85%
Pushpa Jewellers	25	147	172	17.01%
Silky Overseas	25	161	186	15.53%
Marc Loire	15	100	115	15.00%
Vandan Foods	25	115	140	21.74%
Cedaar Textile	17	140	157	12.14%
Indogulf Cropsciences (Mainboard)	12	111	123	10.81%
HDB Financial (Mainboard)	76	740	816	10.27%
Cryogenic OGS	20	47	67	42.55%
PRO FX Tech	8	87	95	9.20%

Note: Some IPOs such as Anthem Biosciences, Travel Food Services, and Crizac are currently showing neutral GMP, reflecting either muted sentiment or undisclosed grey market demand.

Market Interpretation

Even as frontline indices react to headwinds from the IT drag market, IPO investors continue to bet big on high-growth SME names. Strong oversubscriptions and aggressive GMPs in companies like Adcounty Media and Suntech Infra show capital appetite remains robust in niche segments.

This divergence underscores a broader market theme: selective risk-taking by retail and HNI investors even when large-cap sectors underperform.

Smallcap of the Day: Zinka Logistics Solutions Ltd

CMP- ₹435 | Digital Trucking Platform | Asset-Light Freight Model

Zinka Logistics Solutions Ltd (ZLSL), better known for operating the Blackbuck platform, is fast becoming a cornerstone in India’s digital logistics ecosystem. Despite broader market softness, including the recent IT drag market, ZLSL’s differentiated asset-light logistics play and digital-first model has kept investor interest alive in this emerging smallcap.

Business Model Snapshot

Incorporated in 2015, ZLSL began as a full truckload (FTL) logistics player, operating with an asset-light philosophy. Over the years, it has diversified into adjacent high-margin digital services for truck operators and fleet owners:

• Freight: Inter-city, long-haul, open truck transport.
• Truck Operator Services: Includes FASTags, fuel cards, GPS tracking, load boards, and subscription-based tools.
• Vehicle Financing: Through its NBFC arm Blackbuck Finserve, offering financing for used trucks.
• Digital Touchpoints: 9,374 digital points across India for user onboarding and servicing.

The company’s online platform now serves over 9.6 lakh truckers, covering 27.5% of India’s trucking community.

Group Strategy & Structural Shift

To sharpen its focus on core digital logistics services, ZLSL has signed a binding agreement for the slump sale of its corporate freight business for ₹133.25 crore. This exit, expected to complete in FY25, is designed to de-leverage and pivot entirely toward high-margin digital products and financial services.

Revenue Mix (FY24)

ZLSL has a well-diversified topline:

• Commission Income: 40%
• Subscription Fees: 38%
• Service Fees: 16%
• Interest Income (FinServe arm): 6%

This balanced mix ensures recurring revenue visibility and insulation from freight rate volatility.

Financial Snapshot

Metric	Value
Market Cap	₹7,785 Cr.
Current Price	₹435
EPS (FY24)	₹18.5
P/E Ratio	23.5
ROE (FY24)	43.0%
ROCE	10.7%
Debt/Equity	0.01
Cash Reserves	₹662 Cr.
PAT (FY24)	₹332 Cr.
NPM (FY23)	-56.5% → Profitable in FY24 turnaround
EV/EBITDA	56.4

The sharp turnaround from losses in FY23 to ₹332 Cr PAT in FY24 reflects operating leverage at scale and successful cost controls.

IPO Fund Use & Growth Path

With a ₹550 Cr IPO launched, the proceeds will support:

• ₹200 Cr: Marketing and user acquisition
• ₹140 Cr: Capital infusion into Blackbuck Finserve (NBFC arm)
• ₹75 Cr: Product development and tech stack upgrades
• Remaining: General corporate purposes

Analyst View

Zinka’s platform-first model, sticky user base, and transition away from corporate freight points toward strong margin visibility and scalable revenue growth. The ultra-low debt, high ROE, and dominant market share in a fragmented sector position it as a potential re-rating candidate.

Conclusion

Despite the headline indices managing to stay afloat, the IT drag market continues to temper bullish momentum as sector-specific pressures hold back Nifty’s breakout potential. However, strength from banking, logistics, and energy-linked counters signals a healthy rotational play in the broader market.

This week’s technical readings and stock breakouts—such as in IDFC First Bank—highlight that while IT may be a temporary laggard, opportunities are actively shifting toward smallcap and midcap spaces.

New IPOs, government reforms, and structural growth in digital logistics (Zinka Logistics) and energy (Hindustan Power) suggest that sectoral rotation, not index direction, will define alpha going forward.

Stay selective, focus on volumes and sector leadership, and position wisely as the market navigates through the IT weight and eyes the next leg higher.

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