Sensex Snaps 2-Day Decline, Nifty Ends Flat As Investors Reward Earnings Beat
Asian shares declined this morning, following a mixed batch of earnings reports.
Closing Bell
Indian shares closed little changed, but off the day’s low, as investors assessed a flurry of earnings from India Inc., while the Tata Group stocks weighed down by the boardroom tussle at the nation’s biggest conglomerate extended losses.
The S&P BSE Sensex gained 0.3 percent to 27,915 while the NSE Nifty unchanged at 8,615. The market breadth was abysmal at 540 advances, 1,076 declines and 271 stocks remaining unchanged on the NSE.
ICICI Bank helped a 10-member sectoral gauge to eke out gains after hitting a 52-week low earlier in the day.
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No doubt, it’s a tough market phase to deal in, where global jitters every now and then is adding to the domestic chaos. Besides, earning season so far has also failed to trigger any directional move in index. Amid all, our positive bias is intact and it’ll remain so till 8,500 is intact in Nifty. However, excessive volatility on stock-specific front requires special attention. In short, maintain positive yet cautious approach and wait for further clarity.Jayant Manglik, president (retail distribution), Religare Securities wrote in a note.
ONGC Profit Beats Estimate as Rupee Helps Counter Oil’s Slump
The state-run oil explorer’s quarterly profit rose 6.3 percent beating estimates as a weaker local currency and absence of discounts to state-run oil refiners countered a slump in oil and gas prices.
Net income at India’s biggest energy explorer rose to Rs 4,970 crore in the three months ended September 30 from Rs 4,680 crore, the New Delhi-based company said in a statement. That compares with a Rs 4,310 crore mean of 19 analyst estimates compiled by Bloomberg. Sales dropped 3.4 percent sequentially to Rs 18,395 crore.
Full report HERE
Maruti Profit Beats Street on Demand for its Compact Vehicles
Shares of the country’s largest car maker fluctuated between gains and losses after beating street estimates with its second quarter earnings.
Net profit rose to Rs 2,400 crore in the quarter-ended September from Rs 1,500 crore a year earlier, the New Delhi-based unit of Suzuki Motor Corp. said in a statement. That compares with the Rs 1,770 crore average of 31 analysts’ estimates compiled by Bloomberg.
More details HERE
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Ramco Systems Erases Losses After Wining New Order
Shares of the software services firm erased losses and gained 1.3 percent to Rs 470 after announcing an order win. The Chennai-based firm bagged a contract from Malaysia’s Nationwide Express to implement software solutions across 180 locations.
We have also entered into partnership with leading Bumiputera players and Malaysia- based IT Consulting organizations to further expand and serve local businesses”.Virender Aggarwal, CEO, Ramco Systems Press Release.
PNB Housing Finance IPO Fully Subscribed
The initial public offering of housing finance unit of Punjab National Bank received bids for 1.39 times shares offered, according to Bloomberg News.
Escorts Slumps After Q2 Earnings Disappoint Street
Shares of the tractor maker dropped as much as 7.5 percent to Rs 371 after its second quarter earnings missed street estimates.
It made a profit of Rs 31.29 crore for quarter-ended September, compared to Rs 49.80 crore estimated by Bloomberg consensus of analysts’ estimates. It clocked a revenue of Rs 995 crore for the three-month period, which was also lower than the Rs 1,010 crore poll estimate.
Earnings Reaction
- Cummins India gained 1.1 percent; Q2 net Rs 197 crore versus estimate Rs 193 crore
- Deepak Nitrite declined 2.6 percent; Q2 net Rs 15.41 crore versus Rs 67.86 crore YoY
- Forbes & Company down 2.1 percent; Q2 net Rs 26.79 crore versus Rs 5.96 crore YoY
- Hero MotoCorp jumped 1.9 percent; Q2 net Rs 1004 crore versus est. Rs 931 crore
*Company approves investing Rs 205 crore in Ather Energy to take 26-30 percent stake
- Exide Industries down 0.5 percent; Q2 net Rs 181 crore versus est. Rs 180 crore
*Stock cut to neutral versus outperform at Credit Suisse; cut to hold from buy at Karvy Stock
- Hindustan Unilever gained 1.2 percent; Q2 sales volume shrank 1 percent
*HUL CFO Balaji says: Q2 net Rs 1,096 crore versus est. Rs 1050 crore
- IIFL Holdings down 0.8 percent; Q2 net jumps 31 percent YoY to Rs 183 crore
- JK Lakshmi Cement down 2.4 percent; Q2 net Rs 24.91 crore versus loss Rs 8.38 crore YoY
*Cement maker approves plan to raise up to Rs 500 crore via NCDs
- Just Dial gained 0.4 percent; Q2 net drops 27 percent YoY to Rs 29.62 crore
- Lakshmi Machine declined 2.1 percent; Q2 net drops 32 percent YoY to Rs 37.92 crore
- Motilal Oswal down 4 percent; Q2 net Rs 102 crore versus Rs 43.41 crore YoY
- Smartlink Network jumped 3.3 percent; Q2 net Rs 3.19 crore versus Rs 1.11 crore YoY
- Raymond down 2 percent; Q2 net Rs 26.59 crore versus Rs 5.69 crore YoY
- Religare Enterprises down 0.5 percent; Q2 loss Rs 39.54 crore versus loss Rs 13.9 crore YoY
- Thomas Cook down 2.9 percent Q2 net down 46 percent YoY to Rs 3.61 crore
- Torrent Pharma down 2.1 percent; Q2 net Rs 207 crore versus estimate of Rs 279 crore
*Pharma firm lowered to neutral from buy at Nomura, cut to hold from buy at Deutsche
Tata Steel Clarifies On Writedowns Warning
Tata Steel Ltd. stock recovered after the company clarified to the exchanges that the value of its assets were tested for impairment as per accounting norms. The BSE and NSE had sought Tata Group companies' response on the ousted Tata Sons Chairman Cyrus Mistry warning that the group could potentially face writedowns totalling $18 billion.
Shares of the company fell as much as 4.42 percent to Rs 381 only to recover its losses. As of 10 a.m., they are priced at Rs 398 per share, down 0.15 percent.
Opening Bell
Indian shares declined for a third day running, led by Tata Group shares after its ousted Chairman Cyrus Mistry warned that the salt-to-steel conglomerate may face $18 billion in writedowns because of five unprofitable businesses he inherited.
The S&P BSE Sensex dropped 0.3 percent to 27,732 while the NSE Nifty lost 0.4 percent to 8,581. The market breadth was skewed in favour of sellers at 791 declines, 641 advances and 435 stocks remaining unchanged.
Axis Bank Ltd. extend its losses after it reported a five-fold increase in provisions, dragging down a gauge of lenders for a second day.
Tata Motors, Tata Steel and Tata Power tumbled more than 3 percent each, while Indian Hotels Ltd. fell 11.4 percent, the most in five years.
Mistry in an e-mail on Tuesday to the board of group holding company Tata Sons Ltd. said he inherited a debt-laden enterprise saddled with losses. He singled out Indian Hotels, Tata Motor’s passenger-vehicle operations, Tata Steel’s European business as “legacy hotspots."
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Market Movers: Maruti Suzuki, Hero Motocorp, Sun Pharma, IOC And More
Stocks to Watch
- Tata Group companies including Tata Steel, Tata Motors after NSE asks for clarification on possible writedowns
- Bajaj Auto, Gulf Oil: Gulf Oil to make and distribute Bajaj Auto oil product under an agreement
- Balmer Lawrie: To consider free share issue on November 10
- Dr. Reddy’s: To work with Gland Pharma in selling, distributing drugs in the U.S.
- Everonn Education: Shares to be suspended from November 4
- Hinduja Ventures: To divest 1.35 percent stake in Indusind Media at Rs 466 per share
- Indian Hume: To issue 1 free share for every 1 held
- Mahindra CIE: Completes purchase of Bill Forge
- Sagar Cements: To expand Andhra unit, set up captive power plant
- State Bank of India: To consider preference share issue on October 29
- Sun Pharma: Auven Therapeutics will sell global Seciera rights to Sun Pharma
- Union Bank: To raise up to Rs 2,900 crore via various debt options
- Federal Bank: Expects Rs 160 crore of steel sector loan to turn sour
- HDFC: HDFC Fund exits Lodha’s World Towers project for Rs 1500 crore
IPO Watch
- Varun Beverages: IPO subscribed 34 percent on first day of bidding.
- PNB Housing Finance: IPO subscribed 57 percent on second day of bidding.
Earnings to Watch (net income adjusted estimates where available)
- ABB India Q3 (Rs 84.6 crore)
- Bajaj Finance Q2 (Rs 407 crore)
- Bajaj Finserv Q2 Rs 412 crore
- Castrol India Q3 Rs (166 crore)
- Glenmark Pharmaceuticals Q2 (Rs 255 crore)
- Indian Oil Q2 (Rs 3,150 crore)
- JSW Steel Q2 (Rs 852 crore)
- Karur Vysya Bank (Rs 154 crore)
- Maruti Suzuki Q2 (Rs 1,720 crore)
- MRF Q2 (Rs 435 crore)
- Oil & Natural Gas Q2 (Rs 433 crore)
- PVR Q2 (Rs 28.6 crore)
- Tech Mahindra Q2 (Rs 700 crore)
- United Spirits Q2 (Rs 135 crore)
Talking Points
- E-auction starts for India private FM radio phase III channels
- Modi asks states to align plans with budget date change
- Centre may announce 2 percent dearness allowance for staff, pensioners (PTI)
- Delhi-Noida-Direct flyway becomes toll free
- Indian lentil buyers renegotiate as price slumps on crop
- Airbus scraps pending Jet order from India’s failed Kingfisher
- BSE revises fair usage charges on equity, equity derivatives, currency derivatives
- Global funds sell Rs 1,451 crore of local stocks; domestic funds buy Rs 989 crore: Provisional data
- India may not impose additional tax on cigarettes in GST (CNBC-TV18)
- Shoigu sees progress in Russia, India S-400 talks: RIA
- RBI said to likely name new deputy governor by November end (BTVI)
- Pearson said to be in talks to sell TutorVista (Economic Times)
- Former Deutsche Bank Asia CEO Chadha to head Everstone NBFC (Economic Times)
Ousted Tata Boss Warns Group Faces $18 Billion In Writedowns
Ousted Tata Group Chairman Cyrus Mistry accused directors at India’s largest conglomerate of wrongfully dismissing him and warned that the tea-to-software giant may face 1.18 trillion rupes ($18 billion) in writedowns because of five unprofitable businesses he inherited. (Read full copy here)
Here are some must-reads on the Tata-Mistry boardroom tussle:
- Does The Law Allow For A Boardroom Coup?
- Five Amendments That Made Cyrus Mistry A ‘Lame Duck Chairman’
- A Full Reproduction Of Cyrus Mistry’s October 25 Letter To The Tata Sons Board
- ‘My Pushback Was Hard But Futile’ Says Cyrus Mistry On Tata’s Entry Into The Aviation Business
- SEBI Looking Into Tata-Mistry Saga; Bourses Seek Clarification
Day 2 Full Coverage: Mistry’s Explosive Letter, Alleged Fraud In Air Asia India And More
Good Morning!
The Nifty Futures on the Singapore Exchange, an early indicator of Nifty’s performance in India, declined 0.3 percent to 8,585.
Asian shares declined this morning, following a mixed batch of earnings reports even as oil steadied near a three-week low. Samsung Electronics Co.’s third quarter profit fell 17 percent to 4.41 trillion won ($3.9 billion) in the September quarter on the back of the Galaxy Note-7 crisis.
Meanwhile, the dollar strengthened versus the bulk of its peers amid growing confidence that the Federal Reserve will raise interest rates this year.
On Wednesday, U.S. stocks declined, after swinging between gains and losses, as traders grapple with uninspiring outlooks from bellwethers including Apple Inc., Bayer AG and Intel Corp amid uneven economic data.
