Live Markets Commentary
Sify Editors @ 14:05 PM
Buy Tech Mahindra despite the steep fall in share price on Monday?
As we reported earlier, Tech Mahindra delivered a weak performance on both revenue and margin fronts and the stock registered its biggest fall in nine years. But HDFC Securities maintains a buy rating on the stock with a Target Price of Rs 500 based on 13x FY19 EPS. Says growth will be challenged in first quarter, owing to LCC restructuring and seasonally weak Comviva. Margins will be under pressure, owing to the full quarter impact of wage hike and visa costs. Expects margins to improve from second quarter.
Sify Editors @ 13:45 PM
India seen staying fastest growing major economy in Jan-March quarter
India remained the fastest growing major economy in the world last quarter, with growth buoyed by an improved performance in manufacturing and services, a Reuters poll of economists found.
The median forecast from a poll of 35 economists showed the economy grew 7.1 percent annually in the first three months of this year. Forecasts ranged from 6.5 to 7.8 percent.
Annual growth was 7.0 percent in the quarter ending December, and 7.9 percent in the January-March quarter last year.
"The demonetization drive barely impacted the economic momentum in the second half of FY'17. Most of the high-frequency indicators showed only a marginal slowdown and were quick to recover," said Tushar Arora, senior economist at HDFC Bank.
Sify Editors @ 13:00 PM
HPCL reports 31% jump in Q4 net, announces 1:2 bonus; stock down 3%
Hindustan Petroleum Corporation Limited shares are down more than 3% despite the company reporting pretty strong numbers for the quarter ended March 2017 and announcing a bonus issue in the ratio of 1:2.
The stock declined to a low of Rs 543.80 on the National Stock Exchange, losing about 4.3% in the process, and is currently at Rs 549.80, down 3.1% from previous closing price.
Hindustan Petroleum Corporation Ltd reported a 31% jump in net profit in the March 2017 quarter, over the year-ago quarter. The company said it posted a net profit of Rs 1818.79 crore in the fourth quarter, compared to Rs 1387.91 crore in the corresponding quarter of the previous year.
The company realised an inventory gain of Rs 743 crore in the March quarter of 2016-17 as compared to Rs 37-crore gain made in the same period of the previous financial year.
HPCL has announced a bonus issue of one equity share for every two equity shares held by its members. It had issued bonus shares in the ratio of 2:1 (two shares for every one share held) in 2016-17.
"Profit was higher as a result of better operating efficiencies, higher sales and inventory gains," said the company's Chairman and Managing Director Mukesh Surana said.
HPCL has also announced that it has signed a revised memorandum of understanding with the Rajasthan Government for setting up an Integrated Petroleum-cum-Petrochemical Refinery at a revised capital cost of Rs 43,129 crore.
The company expects to commission this project in four years from the date all clearances are in place. All the marketing rights for the products will be with HPCL.
Indian Oil Corporation is up 1.25% at Rs 421, coming off the day's low of Rs 419. The stock had posted notable gains in the previous week, riding on strong quarterly results.
Meanwhile, shares of the other state-run oil marketing company BPCL are up 0.77% from previous closing price on modest support.
Sify Editors @ 11:40 am
Tech Mahindra records steepest single session slide in 9 years
Tech Mahindra shares registered their steepest single session slide in about nine years on Monday morning, as the counter witnessed heavy selling after the company reported a 31.2% decline in consolidated net profit in the fourth quarter ended March 2017, compared to year ago quarter.
Tech Mahindra shares declined to Rs 356.65 on the National Stock Exchange (Rs 357.60 on BSE), and are currently at Rs 382.50, down nearly 11% from previous closing price.
The stock has plunged on heavy volumes, with the counter on the National Stock Exchange clocking a volume of nearly 23 million shares so far in the session.
On BSE, over 1.6 million shares have been traded so far at the counter, almost eight times the average daily volume.
Tech Mahindra reported consolidated net profit of Rs 590 crore for the quarter. EBITDA margin was down 420 basis points (q-o-q) to 8.2%. The company attributed the decline in margin to one off restructuring and pricing cuts in a large account.
Consolidated revenue, in rupee terms, was Rs 7495 crore, as compared to Rs 7557.5 crore in the preceding quarter. The company's dollar revenue was higher by over 1% at Rs $1131.1 million, against $1116.1 million posted during the previous quarter.
Tech Mahindra's board of directors have recommended a dividend of Rs 9 per share on par value of Rs 5 (180%) for the financial year ended March 31, 2017.
Sify Editors @ 11:05 am
Power equipment maker CG Power and Industrial Solutions Ltd falls as much as 14.2% to Rs 80.10, its biggest intraday percentage loss in nearly seven months. It is trading down 11.73% now at Rs 82.40. The company's March-quarter net loss had widened to Rs 4.44 billion ($68.76 million) from Rs 929 million a year earlier.
Sify Editors @ 10:25 am
PSP Projects Ltd shares down 5% on debut. The shares opened at Rs 190, a nearly 10% fall from the issue price of Rs 210per share. Management's lack of experience in diverse geographies and lack of visibility of future order book may become a cause of concern for growth strategy," analysts at Angel Broking wrote in a note.
Sify Editors @ 10:15 am, May 29
Good morning and welcome to the live market coverage on a day when the stock markets are trading almost flat after hitting an all-time high last week.
The headline news on the day is the fall of Anil Ambani's Reliance Communications after it reported a $150 million fourth-quarter loss and worries about its heavy debt load resurfaced.
The company, controlled by billionaire Anil Ambani, over the weekend posted its second straight quarterly loss, dragged down by a price war in what is the world's second-biggest mobile market by number of users.
The shares have recouped some of the lost ground after falling as much as 20%Sify Editors @ 1:00 PM, May 28
Week Ahead: Market to corporate news, economic data for direction
Amid expectations of good monsoon rains, progress on the reforms front and fairly positive global cues, the Indian stock indices Sensex and the Nifty50 scaled new all-time highs last week, and the mood is expected to stay fairly upbeat in the coming week as well.
Some profit taking, however, is not ruled out. Economic data, the trend in crude oil prices and movements of the rupee against the U.S. dollar will be eyed.
Coal India, NTPC, Hindalco, Larsen & Toubro, Mahindra & Mahindra, Power Grid Corporation, BPCL and Power Finance Corporation are among the companies scheduled to announce quarterly results next week.
During the later part of the week, automobile and cement stocks will see plenty of action, with May sales and shipments data from leading players in the sectors setting the trend.
Shares of state-run oil marketing companies will be in focus too. Airlines stocks will track aviation fuel prices for direction.
The market will be tracking the progress of the southwest monsoon. A recent report from India Meteorological Department had said that monsoon rains will arrive over South Kerala by May 30-31.
On the economic front, the data on fourth quarter Gross Domestic Product will be announced by the government on Wednesday (31 May 2017). In the October - December 2017 quarter, GDP had grown at 7%, lower than the 7.4% growth it had registered in the preceding quarter.
The data on India's manufacturing activity in May 2017, will be released by Markit Economics on Thursday (June 1). In April 2017, the Nikkei Manufacturing PMI came in with a reading of 52.5, unchanged from its score of the preceding month.
Data from China, Europe and the U.S. will be eyed as well for direction.
Sify Editors @ 11:00 AM
Weekly Wrap: Sensex, Nifty record new all-time highs
The Indian stock market saw some strong spells in positive territory during the week ended 26 May 2017, amid easing concerns over U.S. interest rate hikes, and on expectations aboout good monsoon rains and reforms.
Stocks had a tough time during the first three sessions, however, due to rising tensions at the border that prompted the Indian army to conduct artillery raids on Pak military posts across the Line of Control.
There were a few volatile spells with s0me front line counters witnessing wild swings due to expiry of May series derivatives contracts.
The BSE benchmark Sensex hit a new all-time high of 31,074.07 on Friday and eventually ended the week with a gain of 563.29 points or 1.85% at 31,028.21. The Nifty50 of the National Stock Exchange ended up 167.20 points or 1.77% at 9595.10, after hitting a record high of 9604.90 on the final session.
Midcap and smallcap stocks declined on profit taking. The BSE Midcap index ended the week lower by about 0.85%, while the Smallcap index declined by about 0.9%.
The market opened the week on a firm note, with a steady trend in Asian and European markets amid easing concerns about U.S. interest rates aiding sentiment. Optimism about growth, encouraging monsoon forecast, the roll-out of GST from July, expectations of a rate cut after recent data showed a significant drop in retail inflation aided sentiment. The Sensex ended up 106.05 points and the Nifty50 gained 10.35 points.
After edging up slightly at the start, the market retreated into negative territory on Tuesday, and after staying sideways for about three hours, staged a modest recovery but plunged again on selling pressure and eventually ended the session notably lower. Reports about the Indian Army conducting punitive artillery assaults to destroy Pakistan military posts across the Line of Control near Rajouri raised geopolitical worries and prompted investors to stay cautious. The Sensex and the Nifty50 ended lower by 205.72 points and 52.10 points, respectively.
On Wednesday, the market ended lower as investors chose to lighten commitments amid none too encouraging global cues and on lingering concerns about the tensions at the border. The Sensex ended 63.61 points down and the Nifty50 declined 25.60 points.
With the bulls staging a strong comeback, the market rebounded on Thursday, after two successive days of losses. The mood was quite upbeat thanks to a positive lead from Asian markets where shares moved higher after the minutes of the US Federal Reserve's monetary policy meeting signalled a cautious approach to future interest rate hikes and hinted at trimming its balance sheet.
Recent encouraging forecast on monsoon rains, the GST rollout from July and hopes that the government will speed up other reforms triggered the buying spree. The Sensex ended up 448.39 points and the Nifty50 gained 149.20 points.
The Sensex and the Nifty50 scaled fresh all-time highs on Friday as stocks across the board saw some strong buying. The Sensex ended up 278.18 points and the Nifty50 gained 85.35 points.
Tata Motors gained more than 8.5% on better than expected fourth quarter results. The company reported a 16.8% decline in consolidated net profit at Rs 4336 crore for the quarter ended March 2017, compared to year-ago quarter. Revenues were down 2.86% in the quarter. Tata Motors launched its new BS IV compliant medium and heavy duty trucks with 'exhaust gas recirculation' and 'selective catalytic reduction' technologies in Tamil Nadu last weekend.
FMCG heavyweight ITC (up nearly 8%) ended sharply higher. The company reported a 12.13% jump in net profit for the quarter ended March 2017, over the year-ago quarter. Total income increased 6.2% to Rs 15,410.92 crore in the fourth quarter.
Shares of carmaker Maruti Suzuki Limited rallied 4.3% thanks to a rating upgrade by a foreign brokerage.
IT bellwether Infosys, engineering sector major Larsen & Toubro and private sector bank majors ICICI Bank and HDFC Bank were among the other top gainers in the Sensex last week, moving up 3.7% - 4.75%.
Sun Pharmaceutical Industries ended nearly 13% down, with disappointing results of its subsdiary Taro Pharmaceuticals triggering heavy selling at the counter. Taro reported a 27.82% decline in net profit in the fourth quarter.
Lupin ended 15.4% down. The pharma major reported a more than 49% decline in consolidated net profit and Cipla ended 12.75% down after reporting consolidated net loss of Rs 61.79 crore in the fourth quarter. Dr Reddy's Laboratories ended weak too, losing about 9.2%.
State Bank of India declined 6.3% and Bajaj Auto shed 5.4%, while Coal India ended 3.1% down.
GAIL India saw some heavy selling midway through the week on disappointing results, but bounced back well to end marginally up. The company reported a sharp 68.7% decline in net profit in the fourth quarter. The fall in bottomline was due to accounting of impairment of investments in Ratnagiri Gas and Power of Rs 783 crore in the March 2017 quarter. The net profit without the impact of impairment rose 25% to Rs 1043 crore in the fourth quarter over the corresponding quarter of the previous year.
Mahindra & Mahindra edged up marginally. The comapny announced that it has plans to invest directly and/or through its subsidiaries in high-end electric powertrain technology as part of its plan for the future of mobility and electrification of some of its existing and future products. The investments will also be utilised towards increasing the capacity for electric powertrains and electric vehicles.
Adani Ports and Special Economic Zone edged down marginally, regaining most of the ground it had lost earlier in the week. The company reported a 27% rise in consolidated net profit for the quarter ended March 2017.
Voltas, Jain Irrigation Systems, Indian Oil Corporation, Bosch, GE T&D, Venky's India, Federal Mogul Goetze, Pincon Spirit, APL Apollo Tubes and Shaily Engineering Plastics saw strong buying last week thanks to upbeat results.
Sintex Industries, trading ex-demerger, rose sharply on huge volumes, on Thursday.
United Spirits rallied sharply following the Chief Executive Officer of the company making a positive pitch on the company’s performance. The company has set out the medium-term goal to grow top-line by double digit and improve operating margin to mid-high teens, he said.
According to reports in a section of the media, the Enforcement Directorate has taken possession of Vijay Mallya's stake in United Breweries and other listed companies. Reports pegged Mallya's dues to lenders at nearly Rs 8200 crore as on December 31, 2016.
Technofab Engineering, Sunil Hitech, CCL Products, SRF, Banco Products, GATI, Den Networks and Sharda Cropchem declined sharply on weak results. Videocon Industries down 20% as Dena Bank declares co's account as NPA.