Sensex, Nifty Drop The Most In A Week As IT, Telecom Drag
India's equity benchmarks dropped the most in a week, dragged by software companies and top private sector banks, after a series of record highs set earlier this month.
The S&P BSE Sensex Index dropped 0.7% to 59,667.60 at close, while the NSE Nifty 50 Index fell 0.7% as well. Bharti Airtel Ltd was the biggest drag on both measures, decreasing 3.6%, followed by Tech Mahindra Ltd. and Bajaj Finance Ltd. Of 30 shares in the Sensex, 20 fell and 10 rose.
Thirteen of the 19 sectoral indexes compiled by BSE Ltd. slipped, led by a measure of realty stocks. The S&P BSE Utilities index was the best performer, up 1.7%.
Indian stocks are expected to move in a “calibrated manner” after the benchmark index more than doubled since March last year, driving up the valuations, according to Girish Pai, head of research at Nirmal Bang Equities Pvt. [catch the interview here]
Sensex index had touched the 60,000 mark for the first time on Friday, driven by optimism for recovery in businesses as Asia’s third-largest economy administers record Covid-19 vaccinations. The index has risen about 25% this year and is one of the best-performing benchmarks among major global markets.
Godrej Consumer Shares Advance On Growth Prospects, Indonesia Recovery
Shares of Godrej Consumer Products Ltd. rose 6.14% in intraday trade to Rs 1,102.45 apiece, after the company said it was on track to post double-digit sales growth in the medium term.
“In FY21, the performance in Indonesia was disappointing. But the business is seeing gradual recovery after the significant second wave [Covid-19] impact,” Akhil Chandra, business head (Asean) at the owner of Good Knight and Cinthol brands, told analysts on a conference call. “Cost inflation and subsequent margin pressure aside, we are confident of growing in double-digits [overall and in Indonesia] with sustenance of margin profile in the medium term.”
Of the 37 analysts tracking the company, 25 maintained 'buy', 11 maintained 'hold' and one maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside off 4.1%. Trading volume was 3.8 times the 30-day average volume for this time of the day.
Over the past three days, the stock has been upgraded by Nomura and Haitong International.
CESC Approves Issue Of Rs 400 Crore Via Non-Convertible Debentures
CESC Ltd. has approved the issue of 4,000 redeemable, rated, senior, secured, unlisted non-convertible debentures having a face value of Rs 10 lakh each for a cash aggregating to Rs 400 crore, on a private placement basis.
In an exchange filing, CESC said that the deemed date of allotment will be September 20, 2021 and the final redemption date will be September 30, 2026.
Of the 18 analysts tracking the company, 16 maintained ‘buy’ and two maintained ‘hold’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 15.5%.
Indian Oil Corporation Advances The Most In 18 Weeks; RSI Above 70
Shares of Indian Oil Corporation Ltd. rose 4.42% in intraday trade, the most in 18 weeks, to Rs 123.9 apiece, higher than any close since January 16, 2020.
Trading volume was 100% above the 20-day average for this time of the day.
The relative strength index on the stock was above 70, indicating it may be overbought.
Indian Oil trades at 6.9 times its estimated earnings per share for the coming year.
Analysts have 31 ‘buy’, four ‘hold’ and one ‘sell’ recommendations on the stock. The overall consensus price of analysts tracked by Bloomberg implied an upside of 9%.
Speaking at Platts’ APPEC 2021 event on Monday, Chairman of Indian Oil, Shrikant Madhav Vaidya said that India will need an additional 100 million tonnes per year crude oil refining capacity.