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Benchmarks pare losses; breadth remains weak

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Capital Market
Last Updated : Jul 20 2021 | 1:50 PM IST

The benchmark indices pared losses in the afternoon trade as buying emerged at lower levels. The Nifty regained 15,650 mark. Global cues were weak amid mounting concerns about the rapidly surging delta variant of the COVID-19 in several countries.

At 13:20 IST, the barometer index, the S&P BSE Sensex, dropped 237.31 points or 0.45% at 52,316.09. The Nifty 50 index slipped 93.45 points or 0.59% at 15,658.95.

Asian Paints (up 1.99%), Hindustan Unilever (up 1.92%), UltraTech Cement (up 1.88%) and Infosys (up 0.46%) supported the indices.

HDFC Bank (down 1.64%), ICICI Bank (down 1.81%) and Bharti Airtel (down 2.22%) were major drags.

The broader indices traded lower. The S&P BSE Mid-Cap index lost 1.05%. The S&P BSE Small-Cap index skid 1.07%.

Sellers outnumbered buyers. On the BSE, 1,011 shares rose and 2,125 shares fell. A total of 133 shares were unchanged.

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Foreign portfolio investors (FPIs) sold shares worth Rs 2,198.71 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 1,047.66 crore in the Indian equity market on 19 July 2021, provisional data showed.

COVID-19 Update:

Total COVID-19 confirmed cases worldwide stood at 19,09,23,535 with 40,96,272 deaths. India reported 4,06,130 active cases of COVID-19 infection and 4,14,482 deaths while 3,03,53,710 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.

In the past 24 hours, India recorded 30,093 new cases in the last 24 hours - the lowest in 125 days, as per Health Ministry's recent data.

Politics:

Lok Sabha has been adjourned till 2 PM. Opposition MPs disrupted proceedings over Pegasus snooping controversy. Rajya Sabha was adjourned for the second time on Tuesday, with a session beginning from 1 PM as all leaders met with the chairman to discuss the COVID-19 situation.

Gainers & Losers:

Shree Cement (up 0.96%) and Bajaj Auto (up 0.75%) were major gainers in Nifty 50 index.

Hindalco Industries (down 2.76%), IndusInd Bank (down 2.45%), Oil & Natural Gas Corporation (ONGC) (down 2.27%) and Mahindra & Mahindra (M&M) (down 2.22%) were major losers in Nifty 50 index.

Nifty Results Today:

Bajaj Finance (down 0.60%) and Asian Paints (up 2.35%) will announce their quarterly results today.

Earnings Impact:

HCL Technologies skid 2.01%. On a consolidated basis, the IT firm's net profit jumped 8.5% to Rs 3,214 crore on 2.2% increase in revenues to Rs 20,068 crore in Q1 FY22 over Q4 FY21. On a year-on-year (Y-o-Y) basis, the company's consolidated net profit surged 9.9% while revenue from operations soared 12.5% in Q1 FY22 over Q1 FY21. EBITDA stood at Rs 4,908 crore in Q1 FY22, falling 3.7% over Q4 FY21 and rising 7.5% over Q1 FY21.

During the quarter ended June 2021, EBITDA margin stood at 24.5% while EBIT margin was at 19.6%. In dollar terms, revenue stood at $2,720 million, up 0.9% Q-o-Q and up 15.5% Y-o-Y. Revenue in constant currency terms rose 0.7% Q-o-Q and up 11.7% Y-o-Y. In its guidance, the company said its revenue is expected to grow in double digits in constant currency for FY22. EBIT margin is expected to be between 19.0% and 21.0% for FY22.

Mastek gained 0.84%. The company's consolidated net profit rose 6% to Rs 80.20 crore on 6.9% increase in total revenue from operations to Rs 516.50 crore in Q1 June 2021 (Q1 FY22) over Q4 March 2021 (Q4 FY21). Consolidated total EBITDA grew 7.6% to Rs 117.50 crore in Q1 FY22 as against Rs 109.20 crore in Q4 FY21. EBITDA margin improved to 22.5% during the quarter compared with 22.4% during Q4 March 2021. In constant currency, revenue from operations rose 4.3% Q-o-Q (quarter-on-quarter) and 27.2% Y-o-Y (year-on-year) to $70.2 million in Q1 FY22. Mastek added 40 new clients in Q1 FY22. The total client count as of 30 June 2021 stood at 651 (LTM) as compared to 639 (LTM) in Q4 FY21.

Allsec Technologies tumbled 11.77% after the company reported consolidated net loss of Rs 7.97 crore in Q1 FY22 compared with net profit of Rs 6.03 crore in Q1 FY21. Revenue from operations jumped 12% to Rs 71.49 crore in Q1 FY22 over Q4 FY21. Profit before tax soared 30% to Rs 10.52 crore in Q1 FY22 as against Rs 8.07 crore in Q1 FY21. EBITDA grew 22% to Rs 15.81 crore in Q1 FY22 as against Rs 12.99 crore in Q4 FY21. EBITDA margin improved to 22.1% during the quarter as compared to 20.3% during Q4 March 2021.

Astron Paper & Board Mill dropped 5.43%. On a consolidated basis, Astron Paper & Board Mill's net profit rose 0.26% to Rs 1.83 crore on 67.16% surge in revenue from operations to Rs 112.45 crore in Q1 June 2021 over Q1 June 2020.

Global Markets:

European shares opened higher while Asian shares declined across the board on Tuesday, 20 July 2021, following an overnight tumble for stocks on Wall Street and concerns about the spread of the delta coronavirus variant. Markets in Indonesia, Malaysia and Singapore are closed on Tuesday for holidays.

On Tuesday, China kept unchanged its benchmark lending rate for corporate and household loans - the one-year Loan Prime Rate (LPR) held steady at 3.85% while the five-year LPR was also left at 4.65%.

Geopolitical jitters also resurfaced on Monday after the U.S., the U.K. and their allies said the Chinese government has been the mastermind behind a series of malicious ransomware, data theft and cyber-espionage attacks against public and private entities - including the sprawling Microsoft Exchange hack earlier this year.

U.S. stocks dropped sharply on Monday on concern a rebound in COVID-19 cases would slow global economic growth. COVID-19 cases have rebounded in the U.S. this month, with the delta variant spreading among the unvaccinated. Cases were already flaring up around the world because of the delta variant.

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First Published: Jul 20 2021 | 1:30 PM IST

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