Sensex tanks 600 pts, Nifty ends at 11,730 amid global rout; Bharti Airtel shines13 min read . Updated: 28 Oct 2020, 03:41 PM IST Devansh Sharma
- Indian stocks settled over 1% lower on Wednesday led by heavy selloff in HDFC twins, ICICI Bank, RIL, Infosys and Kotak Bank
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Indian stocks settled over 1% lower on Wednesday led by heavy selloff in HDFC twins, ICICI Bank, RIL, Infosys and Kotak Bank. Markets fell globally amid concerns about rising covid-19 infections in the US, Europe and uncertainty over next week's US elections.
Sensex settled at 39,922.46, down 599.64 or 1.48%, while Nifty declined 159.80 points or 1.34% to end at 11,729.60.
Bharti Airtel, M&M, L&T, Maruti and Bajaj Finserv were the only gainers in the 30-share Sensex.
Crude oil futures decline on low demand
Crude oil futures on Wednesday fell by 3.51% to ₹2,831 per barrel as participants reduced their positions on low demand.
On the Multi Commodity Exchange, crude oil for November delivery eased by ₹103, or 3.51%, to ₹2,831 per barrel with a business volume of 3,319 lots.
Globally, West Texas Intermediate crude oil was trading 2.98% lower at USD 38.39 per barrel, while Brent crude declined 2.43% to USD 40.20 per barrel in New York.
ICICI Securities on Bharti Airtel
ICICI Securities said Bharti Airtel's second quarter numbers underlined "superior execution" in India mobile and other segments. "Bharti's India mobile print shows marked improvement in many areas such as growth in total subs without ARPU dilution which shows quality of customer addition; lower churn rate increasing life-time value of customers and continued delivery of 4G net add, which has now likely matched the market leader," it said in a report on Tuesday.
ICICI Securities believes that higher 4G subscriber base will enable the telco to better transfer tariff hike into Average Revenue Per User (ARPU), whenever such hike happens.
Amara Raja Batteries down 5.5%
Amara Raja Batteries Ltd on Tuesday reported a 7.93 per cent fall in consolidated profit after tax at ₹201.27 in the second quarter ended on September 30. The company had posted a consolidated profit after tax of ₹218.61 crore in the July-September period a year ago. However, its revenue from the operations was up 14.16 per cent to ₹1,935.52 crore during the quarter under review, compared with ₹1,695.31 crore in the year-ago period.
Top laggards on Nifty Bank
Sanofi India down 1.5%
Drug firm Sanofi India reported a net profit of ₹132.9 crore for the quarter ended September 30, 2020. The company had posted a net profit of ₹126.6 crore in the corresponding period of the previous fiscal.
ICICI Prudential Life Insurance falls 1%
Leading private sector life insurer ICICI Prudential Life Insurance Co on Tuesday reported a flat net profit of ₹303.22 crore in the September quarter, weighed down by higher tax outgo which offset the high underwriting profit and record margin from new premium income. The company had posted a net profit of ₹301.86 crore in the year-ago quarter, it said in a statement.
Shares of JM Financial little changed at ₹80.70 apiece on the BSE
The company reported a consolidated net profit of ₹139.06 crore for the September quarter, a growth of 7.31% over the same period last fiscal, despite a 5.6% decline in revenue due to the pandemic.
Nippon Life India Asset Management down 0.15%
Nippon Life India Asset Management Ltd (NAM India) on Tuesday reported a 6% growth in profit after tax (PAT) at ₹145 crore for the quarter ended September 30. It had posted a PAT of ₹137 crore in the same quarter of previous fiscal.
Radico Khaitan September quarter profit falls
Consolidated net profit dropped 6.5% y-o-y to 74.67 crore from ₹79.94 crore on the year ago period.
Total income stood at ₹2744 crore, up 8% from ₹2521.9 crore in the same quarter of the previous fiscal.
All sectoral indices on NSE in the red
Tata group to set up ₹5000 crore phone component making unit in TN
The Tata group is investing ₹5,000 crore to set up a phone component manufacturing plant in Tamil Nadu, according to a report by The Hindu BusinessLine.
The paper said Tata Sons company, Tata Electronics, has been allotted 500 acres by TIDCO (Tamil Nadu Industrial Development Corporation) and that group firm Titan Co Ltd’s precision engineering division, Titan Engineering and Automation Ltd, will provide the expertise for this project. (Full report)
Rupee settles 16 paise lower at 73.87 against US dollar.
Dr. Reddy's Laboratories announces appointment of new CFO
Dr. Reddy's Laboratories has announced that Parag Agarwal will be joining the Company as Chief Financial Officer (Designate)
on 2 November 2020. The Board of Directors at their meeting held today, has approved his appointment as a Chief Financial Officer (KMP*) of the Company effective 1 December 2020.
Dr. Reddy's Q2 profit dives 30%
Hyderabad-based pharma major Dr Reddy's Laboratories (DRL) reported a net profit of ₹762.3 crore in the second quarter of FY21, down 30% percent from ₹1,092.5 crore in the year-ago period. Q2FY21 revenue increased 2% to ₹4,897 crore from ₹4,800.1 crore in same quarter of the previous fiscal.
Sensex at day's low
DGCA extends international flight suspension till 30 November
International flights to and from India will remain suspended till 30 November, the Directorate General of Civil Aviation (DGCA) said, extending the suspension that was to end on 31 October.
However, international all-cargo operations and flights specifically allowed to operate by the aviation regulator, such as repatriation flights, charter flights, and flights under the Vande Bharat Mission, will continue to operate, a DGCA circular said. International scheduled flights may be allowed on select routes by the competent authority on a case-to-case basis, it added.
Titan Company’s September quarter consolidated profit slides
September quarter consolidated profit stood at ₹1.75 billion versus profit ₹3.15 billion year ago.
Consolidated sale of products/services in the period under review stood at ₹41.27 billion versus ₹46 billion year ago.
After a positive start, equity indices spiralled lower on Wednesday during the afternoon trade dragged by HDFC twins, ICICI Bank and Infosys.
Globally, shares slipped amid concerns about rising covid-19 infections in the US, Europe and uncertainty over next week's US elections.
At 13:24pm, Sensex was at 40,050.22, down 471.88 points or 1.16%, while Nifty declined 132.10 points or 1.11% at 11,757.30.
Bharti Airtel, M&M and Maruti were the only gainers in the 30-share Sensex.
Castrol India up 8%
Shares of Castrol India soared 8% to ₹118 apiece on the BSE on strong September quarter results. The profit after tax (PAT) grew 8.6% to ₹205 crore y-o-y in the period under review. Revenue increased 4% y-o-y to ₹883 crore. Ebitda rose 17.9% y-o-y to ₹288 crore.
Geojit Financial Services puts 'buy' on Tech Mahindra
Geojit Financial Services has put 'buy' rating on Tech Mahindra with a target price of ₹923. "In Q2FY21, revenue rose 2.9% QoQ (+3.3% YoY), owing to recovery in demand. In USD terms, on constant currency (CC) basis, revenue came in as mixed bag +2.9%/-3.0% on QoQ/YoY. EBIT margin expanded by ~410bps QoQ, led by demand/supply improvement (+160bps), prudent cost management (+160bps) and seasonality benefit (+160bps). The improved demand/supply scenario, margin expansion and increase in deal wins should support the company’s steady recovery. Hence, we retain our BUY rating on the stock with a revised TP of Rs. 923 on 17x FY22E adj. EPS," the brokerage said.
Vedanta up 3%
Mining mogul Anil Agarwal-led Vedanta Resources Ltd's (VRL) failed attempt to take full ownership of its profitable operating subsidiary Vedanta Ltd will weaken liquidity, Moody's Investors Service said on Tuesday giving reasons for it placing VRL's rating under review for downgrade.
Earlier this month, VRL did not get the mandatory shares from the public to delist Mumbai-listed Vedanta Ltd (VDL).
"Without operations of its own, VRL – as the holding company – needs to refinance debt maturities at a time of tight capital market liquidity, putting undue pressure on key subsidiaries to upstream cash," says Kaustubh Chaubal, Moody's Vice President and Senior Credit Officer.
Motilal Oswal puts 'buy' on HDFC Bank with a target price of ₹1,500
"HDFCB (HDFC Bank) continues to deliver strong growth in a challenging macro environment, and the business momentum has swiftly moved toward pre-COVID levels. Furthermore, the bank’s operating performance remains strong despite margin pressure and lower fee income trends. However, we expect the margin trajectory to now stabilize, and an uptick in unsecured retail would support fee income trends. Also, HDFCB continues to make healthy provisions to further strengthen the balance sheet. Thus, a higher provision buffer would limit the damage on asset quality and enable the bank to quickly recover to a normal growth run-rate. We estimate a 19% PAT CAGR over FY20–23E, with ROA/ROE of 2.0%/17.8% for FY23E. Maintain Buy, with revised TP of INR1,500 (3.3x Sep’22E ABV)," the brokerage said.
Lakshmi Vilas Bank down nearly 4%
The proposed merger between Clix Capital and Lakshmi Vilas Bank (LVB) has run into delays over the provisioning of the bank’s contingent liability of ₹720 crore related to transactions involving former Religare promoters Malvinder and Shivinder Singh, according to a Mint report.
Aditya Birla Fashion and Retail down 2.3%
Traders' body CAIT has raised objections over Aditya Birla Fashion and Retail's (ABFRL) plans to raise ₹1,500 crore by issuing 7.8% stake to Walmart-owned Flipkart Group, alleging that the proposed deal violates the government's FDI policy.
Gold steady as coronavirus, US elections uncertainty loom
Gold prices were little changed on Wednesday, staying above the $1,900-mark, as uncertainties about US elections and surging global covid cases countered pressure from a firmer dollar and fading hopes of an immediate US stimulus package.
Spot gold was steady as $1,906.15 per ounce by 0329 GMT. U.S. gold futures were down 0.3% at $1,907.10.
TCS selected strategic partner for Belgian insurer AG's digital transformation
Tata Consultancy Services (TCS) has been selected as a strategic
partner for managed IT services by AG, a leading Belgian insurer, to help enhance the latter’s digital channels and modernize its IT systems, leveraging TCS’ Machine First approach.
With over 2.7 million customers, AG is a market leader in the Belgian insurance sector.
L&T’s special dividend proposal raises hopes of better capital allocation
Engineering and construction major Larsen & Toubro (L&T) will announce its September quarter earnings on Wednesday. But investors are more eager about a proposed special dividend than the quarterly result. The stock up around 5% since the company said it will consider a special dividend on 28 October.
A part of Rs14,000 crore from its recently concluded deal with Schneider Electric would be distributed to shareholders. Adjusted for tax, analysts estimate net sale proceeds to be around ₹12,000 crore or around ₹86 on a per share basis. (Full report)
HDFC down 2.5%
All Sectoral Indices in the red, barring pharma, metal and auto
Nifty Bank weak
Rupee rose 6 paise to 73.65 against US dollar in early trade. On Tuesday, the Indian currrency closed at 73.71
Cognizant appoints Rajesh Nambiar as India CMD
Cognizant Technology Solutions Corp. has appointed Rajesh Nambiar as the chairman and managing director of India and a member of its executive committee, effective 9 November.
Cognizant has been scouting for a new chief to head its India operations ever since Ramkumar Ramamoorthy left the company on 17 July after spending 23 years in the company.
Hero MotoCorp up 3.5%
The country's largest two-wheeler maker Hero MotoCorp and Harley-Davidson has announced a wide-ranging partnership for the Indian market, days after the US cult bike manufacturer announced its exit from the country.
"The Index is still stuck in a range between 11650 and 12050. While choppy markets can test a trader's patience, one must exercise caution and avoid trading in rangebound markets. If we can get past 12050, the Nifty can achieve 12200-12300. If it breaks 11650, we could drop to 11400-11450," said Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments.
ICICI Bank down 0.7%
ICICI Bank on Tuesday said the US Securities and Exchange Commission (SEC) does not intend to take any enforcement action against the lender related to its investigation into the bank’s loan impairment provisions under US generally accepted accounting principles (GAAP).
“The bank has, via its legal counsel, received a communication from the US SEC that they have concluded their investigation into the bank’s loan impairment provisions under US GAAP, and that the SEC does not intend to take any enforcement action against the bank," it said in a regulatory filing.
Angel Broking on Bharti Airtel
"Overall, Company reported better numbers than street expectations.
Mobile ARPU improved significantly by 26.5% YoY to ₹162 due to tariff hikes and increase in data usage. We are bullish on the Bharti Airtel considering that industry dynamics are looking favorable, it is expected to gain revenue market share and stock has corrected ~30% from its high which provides valuation comfort," said Keshav Lahoti, Associate Equity Analyst, Angel Broking.
Bharti Airtel zooms 8%
The country's second largest telecom operator reported its highest-ever quarterly consolidated revenue on the back of a rise in data usage and higher realisations, helping it narrow losses in the July-September period. Consolidated revenue rose 22 % to ₹25,785 crore in the September quarter while net loss narrowed to ₹763 crore.
Airtel's losses were significantly lower than the year-ago period when it stood at ₹23,045 crore after the company had made provisions of ₹28,450 crore in the immediate aftermath of the Supreme Court ruling on statutory dues.
Indian benchmark equity indices opened higher on Wednesday even as global shares slipped amid concerns about rising covid-19 infections in the US, Europe and uncertainty over next week's US elections.
Sensex opened at 40,664.35 up 142.25 points or 0.35%, while Nifty advanced 33.20 points or 0.28% to open at 11,922.60.
Bharti Airtel, rising over 4%, was the top Sensex gainer followed by Infosys, TCS, Bajaj Finserv and HCL Tech. Kotak Bank, Power Grid, Nestle and HDFC among others opened in the red.
Indian stocks traded higher in the pre-opening session on Wednesday. At 9:03am, Sensex was at 40,724.93, up 202.83 points or 0.5%, while Nifty advanced 106.05 or 0.89% at 11,995.45.
Stocks to Watch
ICICI Bank, Bharti Airtel, Hero MotoCorp, Tata Motors and Vedanta are among the top ten stocks that may be in news in today's trade. (Full report)
Market at close on Tuesday
Indian shares ended higher on Tuesday, fuelled by hopes of higher foreign inflows into local markets after MSCI said it would revise its global indexes to reflect changes in the country's foreign ownership limits.
The NSE Nifty 50 index closed up 1.03% at 11,889.4, while the S&P BSE Sensex ended 0.94% higher at 40,522.1.
Asian shares sag on coronavirus, US election worries
Global shares slipped on Wednesday as coronavirus infections grew at an alarming pace in the United States and Europe, while uncertainty over next week's US elections added to a "risk off" tone.
Singapore's SGX Nifty was little changed.
Japan's Nikkei fell 0.3%.
China's Shanghai Composite dropped 0.17%, while Hong Kong's Hang Seng declined 0.3%.
Australia's ASX 200 was up 0.26%.
South Korea's KOSPI was down 0.13%.
Dow, S&P 500 end lower on disappointing earnings
Stocks on Wall Street closed little changed on Tuesday, with the Dow and S&P 500 slipping on disappointing earnings and little hope for a US coronavirus stimulus before Election Day, though the Nasdaq rose ahead of big technology company results.
The Dow Jones Industrial Average fell 222.19 points, or 0.8%, to 27,463.19 and the S&P 500 lost 10.29 points, or 0.30%, to 3,390.68. The Nasdaq Composite added 72.41 points, or 0.64%, to 11,431.35.