Shares of the country's largest telecom firm Bharti Airtel today nosedived by nearly 7%, after the company posted a 22% decline in its third-quarter net profit.
The stock closed at Rs 354 a share at the BSE, posting a decline of 6.58% from its previous close. In the intra-day trade, the stock had plunged by 7.11% to a low of Rs 352.
Similar movement was seen on the National Stock Exchange, where the stock plunged by 6.81% to finish the trade at Rs 352.95. During the day's trade, the stock had touched a low of Rs 351.40, and a high of Rs 370.
"The counter of Bharti Airtel turned weak as the earnings fell short of market expectations. Besides, the stock is overbought, so a correction was needed," CNI Research CMD Kishor Ostwal said.
Another analyst, Alex Mathew, Head Research at Geojit BNP Paribas Financials, said, "Shares of the telecom player tumbled as the quarterly earnings were below the street expectations. We were expecting a decline in net profit the range of 15-18%."
"The company is in huge debt, as it had a net debt of $12.72 billion as of December 2011," he added.
Bharti Airtel shares also underperformed the broader market trend, as the benchmark Sensex ended the day with a gain of 85 points to close at 17,707.32 points.
Bharti Airtel this morning posted its eighth consecutive quarter of declining profit, as its third-quarter net fell by 22% to Rs 1,011 crore in the October-December period of the current fiscal.
The profits declined in the latest quarter mainly due to higher interest outgo and costs related to launch of its third generation services.
