Domestic shares declined for a second straight session on Tuesday amid weak global sentiment. Global stock markets were under pressure after the death toll and incidence rate of the Chinese coronavirus escalated over the weekend. Investors also turned cautious ahead of the Union Budget on Saturday, 1 February 2020.
The barometer BSE S&P Sensex fell 188.26 points or 0.46% to 40,966.86. The index rose as much as 0.43% to hit the day's high of 41,333.25 in morning trade. It fell as much 0.69% to hit the day's low of 40,869.75 in late trade.
The Nifty 50 index lost 58.75 points or 0.48% to 12,060.25. The index rose as much as 0.37% to hit the day's high of 12,163.55 in morning trade. It fell as much 0.78% to hit the day's low of 12,024.50 in late trade.
In the wider market, the BSE Mid-Cap index fell 0.52% and the BSE Small-Cap index fell 0.19%.
The market breadth was weak. On the BSE, 990 shares rose and 1542 shares fell. A total of 174 shares were unchanged.
Numbers to Watch:
The yield on 10-year benchmark federal paper rose to 6.567% at 16:45 IST compared with 6.551% at close in the previous trading session.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 71.35, compared with its close of 71.435 during the previous trading session.
In the commodities market, Brent crude for April 2020 settlement fell 46 cents to $58.12 a barrel. The contract fell $2.52 or 4.15% to settle at $58.17 a barrel during the previous trading session.
Foreign Markets:
Most shares in Europe and Asia edged lower on Tuesday. The continued spread of the coronavirus in Asia fed risk-off sentiment among traders. Markets in China and Hong Kong were closed on Tuesday for holidays.
China took more drastic steps to combat the coronavirus. As of Tuesday morning, Chinese health authorities have reportedly confirmed that 106 people have died with 4,515 now infected, with cases reported in multiple countries around the world.
US markets on Monday closed sharply lower, with all three indexes posting their worst daily losses in months, while U.S. 10-year Treasury yields hit a three-month low as investors flocked to traditional safe-haven assets. This happened amid growing worries about the economic implications of a rising death tolls and growing infections from a fast-moving virus in China.
Back in Europe, Brexit is back in focus with the U.K. set to leave the European Union on Friday, beginning a transitional period in which both sides work toward the ambitious target of agreeing a new free trade agreement this year.
Buzzing Indian Segment:
The Nifty Metal index fell 2.39% to 2,645.05, extending losses for second session. The index has corrected 5.41% in two days. The China virus outbreak could sap demand for industrial metals if it spreads far enough to make an impact on China's construction season, which tends to start in earnest after the Lunar New Year break.
Vedanta (down 4.5%), SAIL (down 3.59%), Tata Steel (down 3.49%), JSW Steel (down 2.85%), JSPL (down 1.87%), NALCO (down 1.43%), Hindalco Industries (down 1.14%), Hindustan Copper (down 1%), Hindustan Zinc (down 0.87%) and NMDC (down 0.84%) declined.
The S&P BSE Telecom fell 4.11% to 1,161.62. Bharti Airtel (down 4.55%), Bharti Infratel (down 1.43%) and Vodafone Idea (down 7.57%) declined.
Index heavyweight Reliance Industries, which controls Reliance Jio, fell 2.34% to Rs 1471.35.
The media reported that a consumer forum called Save Consumer Rights Foundation filed a public interest litigation (PIL) with the Supreme Court, which sought action against the Department of Telecommunications (DoT). The PIL sought action against an order by the DoT which said that no coercive action will be taken against telcos for missing the 23 January deadline to file their Adjusted Gross Revenue (AGR) dues.
The Supreme Court is set to hear on the telecom operators' plea on their AGR outstandings this week. In light of the modified application moved before the Apex Court by the telecom operators, DoT decided to hold out on any further action until the hearing for the application has taken place sometime during the coming week.
Stocks in focus:
Maruti Suzuki India slipped 2.05%. The car major's consolidated net profit grew by 4.13% to Rs 1587.4 crore in Q3 December 2019 as against Rs 1525 crore reported in Q3 December 2018. Consolidated Profit before tax (PBT) for Q3 December 2019 stood at Rs 2026.3 crore, down by 3.31% against Rs 2095.7 crore reported in Q3 December 2018. Tax expenses declined 23.16% to Rs 439 crore in Q3 FY20 from Rs 571.2 crore posted in Q3 FY19.
The company clarified that rise in net profit is on backdrop of cost reduction efforts taken, lower operating expenses, lower commodity prices and reduction in corporate tax rate. Higher sales promotion expenses, higher depreciation and lower fair value gains on invested surplus dented net profit. Total Revenue from Operations rose 5.29% to Rs 20721.8 crore in Q3 2019 as compared to Rs 19680.7 crore reported in Q3 2018.
The company sold a total of 437,361 vehicles during the quarter, higher by 2% compared to the same period previous year. Sales in the domestic market stood at 413,698 units, higher by 2%. Exports were at 23,663 units.
The car major announced a price change for select models owing to increase in input costs. The company said that the price change varies across models and ranges from 0% to 4.7% (ex-showroom - Delhi). The new prices are effective from 27 January 2020.
HDFC rose 1.53%. The housing finance major's standalone net profit surged 296.1% to Rs 8,372.49 crore in Q3 December 2019 from Rs 2113.80 crore in Q3 December 2018. The reported profit before tax for the quarter ended on 31 December 2019 stood at Rs 9142.99 crore, up by 218.7% from Rs 2,869 crore in the corresponding quarter of the previous year. Merger of GRUH Finance with Bandhan Bank resulted in a fair value gain of Rs 9,019.81 crore in Q3 December 2019.
Net interest income (NII) rose 9% to Rs 3,239.92 crore in Q3 December 2019 from Rs 2,983.89 crore in Q3 December 2018. Net interest margin stood at 3.3% as on 31 December 2019 as compared to 3.4% as on 31 December 2018.
Assets Under Management (AUM) rose 13.59% to Rs 505,401 crore as on 31 December 2019 as compared to Rs 444,923 as on 31 December 2018. The gross non-performing loans as at 31 December 2019 stood at Rs 5,950 crore. This is equivalent to 1.36% of the loan portfolio. The non-performing loans of the individual portfolio stood at 0.75% while that of the non-individual portfolio stood at 2.91%.
Torrent Pharmaceuticals fell 5.77%. The company's consolidated net profit rose 2% to Rs 251 crore in Q3 December 2019 from Rs 246 crore in Q3 December 2018. Adjusted for one-time impact of patent related settlement and litigation cost in December 2018 quarter, net profit is up by 17%. Profit before tax (PBT) stood at Rs 319 crore in Q3 December 2019, up by 16% from Rs 275 crore in Q3 December 2018. Net sales declined by 1.2% to Rs 1924 crore in Q3 December 2019 from Rs 1948 crore in Q3 December 2018.
Coal India fell 2.17%. CIL's production stood at 54.17 million tonnes (MTs) till 27 January 2020, was ahead by 5.23 MTs in absolute terms on a like-to-like comparison of last year, registering a growth of 10.7% - the first double digit growth so far during the current fiscal. CIL as whole has been averaging close to 2 MTs per day coal output during the month. Coal off-take at 48.07 MTs, as of 27 January 2020, registered a growth of 6.2% compared to same date last January, the increase in volume terms being 2.82 MTs.
Navin Fluorine International soared 9.21% after consolidated net profit rose 16.8% to Rs 45.13 crore in Q3 December 2019 as against Rs 38.63 crore reported in Q3 December 2018. Net sales of the company grew 11.4% year-on year (YoY) to Rs 260.50 crore. Profit before tax (PBT) for Q3 December 2019 (Q3 FY20) stood at Rs 67.29 crore, up by 20.4% against Rs 55.89 crore in Q3 December 2018 (Q3 FY19). Tax expenses rose 24.3% to Rs 20.33 crore in Q3 FY20 from Rs 16.36 crore reported in Q3 FY19.
United Spirits surged 14% after the company announced robust Q3 numbers after market hours on Monday, 27 January 2020. On consolidated basis, United Spirits' net profit rose 15.3% to Rs 235.30 crore in Q3 December 2019 (Q3 FY20) as against net profit of Rs 202.99 in Q3 December 2018 (Q3 FY19). Profit before tax (PBT) for Q3 December 2019 stood at Rs 314 crore, up by 8.2% against Rs 290.30 crore in Q3 December 2018. Tax expenses declined 26.2% to Rs 94.90 crore in Q3 FY20 from Rs 128.60 crore in Q3 FY19.
KRBL jumped 6.26%. On a consolidated basis, KRBL's net profit jumped 48.29% to Rs 159 crore in Q3 December 2019 as against Rs 107.22 crore posted in Q3 December 2018. Revenue from Operations soared 42.02% to Rs 1328.98 crore in Q3 December 2019 over Q3 December 2018.
Aptech tumbled 6.66% after the media reported that billionaire investor Rakesh Jhunjhunwala is being probed by Sebi for alleged insider trading in the shares of Aptech. As per the Aptech shareholding pattern, Rakesh Radheshyam Jhunjhunwala held 12.76%, Rekha Rakesh Jhunjhunwala held 11.46% stake, Rajeshkumar Radheshyam Jhunjhunwala held 0.62% stake and Rare Equity held 21.16% stake as on 31 December 2019.
Alembic Pharmaceuticals rose 2.94% after the company received final US drug regulator's final approval for Azithromycin tablets USP, 600 mg. The approved ANDA is therapeutically equivalent to the reference listed drug product (RLD) Zithromax Tablets, 600 mg, of Pfizer, Inc. (Pfizer). Azithromycin tablet is a macrolide antibacterial drug indicated for mild to moderate infections caused by designated, susceptible bacteria in acute bacterial exacerbations of chronic bronchitis in adults; acute bacterial sinusitis in adults
Infosys ended flat at Rs 777.90. The IT major said that it divested its stake in Unsilo A/S for approximately $0.8 million on 28 January 2020. In November 2016, Infosys had announced an investment of 14,920,000 Danish Krone from its Innovation Fund in an artificial intelligence startup Unsilo.
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