Sensex, Nifty Log Second Weekly Decline, But End July Higher
India's equity benchmarks logged their second weekly drop as companies continued to report lackluster earnings for the latest quarter amid the pandemic and rising commodity inflation.
The S&P BSE Sensex lost 0.13% to 52,586.84, down 0.7% for the week. The NSE Nifty fell by a similar magnitude to 15,763.05.
Sun Pharmaceuticals Industries was the top performer on the Sensex today, rising 10%, after its June quarter earnings were ahead of consensus estimates. Bajaj Finance and State Bank of India contributed the most to the index’s decline.
The broader markets outperformed their larger peers. The S&P BSE Midcap rose 0.52% while the S&P BSE Smallcap added 0.69%. Eleven of the 19 sector sub-indices compiled by BSE Ltd. climbed, led by healthcare companies.
Most quarterly earnings so far have failed to impress the market. Of those companies that have reported results, 18 of the 27 Nifty firms have missed analyst estimates.
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Marico Gains On In-Line June Quarter
Shares of Marico Ltd gained 3.44% to Rs 546.00 apiece after the company reported June quarter numbers in-line with average analyst estimates.
June Quarter Results (Consolidated, QoQ)
Net Income at Rs 365 crore vs estimate of Rs 363 crore (Bloomberg consensus)
Revenue from operations at Rs 2,525 crore vs estimate of Rs 2,501 crore
Total expenses at Rs 2,085 crore vs Rs 1,739 crore
Other income at Rs 27 crore vs Rs 29 crore
Ebitda at Rs 481 crore vs estimate of Rs 496 crore
Out of the 41 analysts tracking the company, 33 maintained ‘buy’, 7 maintained ‘hold’ and 1 analyst maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg hinted at a downside of 8.4%.. Shares of Marico have added 35.3% in 2021 so far.
COMMENTARY AND CONTEXT
Company says it holds its aspiration to deliver 13%-15% revenue growth over the medium term on the back of 8%-10% domestic volume growth and double-digit constant currency growth in the international business
Resurgence of Covid-19 in Bangladesh and Vietnam, and political unrest in South Africa have affected business in July and could soften the performance of the international business in the immediate near term
India demand trends have improved as positivity rates are back to pre-second Covid wave levels
Rural consumption moderated due to the second wave, but company expects it to grow ahead of urban.
Indian Oil Q1: Net Income Beats Estimates
Shares of Indian Oil Corporation Ltd. gained 2.31% to Rs 106.30 apiece after it reported net income for the June quarter that beat average analyst estimate.
June Quarter (Standalone, QoQ)
Revenue down 4.1% at Rs 1,18,670.52 crore vs Rs 1,23,714.04 crore (Bloomberg Consensus Estimate of Rs 1,27,900 crore)
Net profit down 32.3% at Rs 5,941.37 crore vs Rs 8,781.3 crore (Estimate Rs 3,547.4 crore)
EBITDA down 17.6% at Rs 11,126.08 crore vs Rs 13,501.79 crore (Estimate Rs 8,606.3 crore)
EBITDA margins at 9.4% vs 10.9% (Estimate 6.7%)
Sun Pharma Jumps After Q1 Beats Estimate
Sun Pharmaceutical Industries Ltd. recovered from a surprise quarterly loss last year and swung back into profit as the U.S., its largest overseas market, started reopening after curbing its Covid-19 outbreak.
The firm headed by billionaire Dilip Shanghvi posted a net income of Rs 1,440 crore ($193.7 million) for the quarter ended June 30 compared to an average profit estimate of Rs 1,413 crore based on a Bloomberg survey of analysts.
Revenue rose 28% to Rs 9,720 crore, according to an exchange filing Friday. It also took a much smaller one-time charge of Rs 631 crore in the latest quarter.