The benchmark indices suffered heavy losses on Monday amid a major sell-off in IT, banks and financial service scrips. Infosys slumped on reporting lower-than-expected Q4 results. HDFC twins were also under pressure after HDFC Bank's Q4 earnings fell short of expectations. Firm crude oil prices and a steep rise in fresh COVID-19 cases in India also dampened investors sentiment.
As per provisional closing basis, the barometer index, S&P BSE Sensex slumped 1,172.19 points or 2.01% at 57,166.74. The Nifty 50 index tumbled 302 points or 1.73% at 17,173.65.
The S&P BSE Mid-Cap index declined 0.95%. The S&P BSE Small-Cap index fell 1.01%.
The market breadth, indicating the overall health of the market, was negative. On the BSE, 1,474 shares rose while 2,051 shares fell. A total of 145 shares were unchanged.
Oil prices rose on Monday as concerns grew about tighter global supply, with the deepening crisis in Ukraine raising the prospect of heavier sanctions by the West on top exporter Russia. The International Energy Agency had warned that roughly 3 million barrels per day (bpd) of Russian oil could be shut in from May onwards due to sanctions, or buyers voluntarily shunning Russian cargoes. In the commodities market, Brent crude for June 2022 settlement fell 15 cents or 0.13% at $111.55 a barrel.
COVID-19 Update:
India recorded 2,183 new COVID-19 cases and 214 deaths in the 24 hours ending 8 AM on Monday, according to the Union Ministry of Health and Family Welfare. The active cases currently stand at 11,542 and comprise 0.03% of the total infections. The recovery rate remained unchanged at 98.76% and 1,985 recoveries were reported on Sunday.
Delhi is registering an uptick in cases; daily cases breached the 500 mark on Sunday, with the city recording 517 cases in 24 hours. The positivity rate in the national capital has jumped from 0.5% to 5.33% in two weeks. Amid the increase in infections, the Delhi Disaster Management Authority (DDMA) will take stock of the situation and meet on 20 April 2022.
Economy:
India's inflation based on wholesale price index (WPI) stood at 14.55% in March 2022 compared with 7.89% in March 2021.
"The high rate of inflation in March, 2022 is primarily due to rise in prices of crude petroleum & natural gas, mineral oils, basic metals, etc owing to disruption in global supply chain caused by Russia-Ukraine conflict," the Ministry of Commerce & Industry said in a statement today.
WPI grew 13.11% in February 2021, while the figure for January was 13.68%.
Meanwhile, the poverty in India is 12.3% lower in 2019 compared with 2011. The poverty headcount rate has declined from 22.5% in 2011 to 10.2% in 2019. According to policy research working paper of World Bank, poverty reduction was higher in rural areas as against urban India. Rural poverty dropped by 14.7% while urban poverty declined by 7.9% during 2011 to 2019.
Monsoon Update:
India is likely to witness normal rainfall during the southwest monsoon season this year, the India Meteorological Department (IMD) said on Thursday.
The rainfall during the 2022 monsoon season (June to September) averaged over the country as a whole is likely to be normal (96-104% of Long Period Average (LPA)). Quantitatively, the monsoon seasonal (June to September) rainfall is likely to be 99% of the LPA with a model error of 5%. The LPA of the season rainfall over the country as a whole for the period 1971-2020 is 87 cm, IMD noted.
Buzzing Index:
The Nifty Media fell 1.46% to 2,354.85. The index lost 3.70% in three trading sessions.
Among the components of the Nifty Media index, Hathway Cable & Datacom (down 0.26%), Saregama India (down 0.41%), Sun TV Network (down 0.67%), Nazara Technologies (down 1.43%) and Zee Entertainment Enterprises (ZEEL) (down 1.88%) were the top losers.
Among the other losers were Inox Leisure (down 2.75%), PVR (down 4.17%), Dish TV India (down 4.55%).
On the other hand, Network 18 Media & Investments (up 9.12%) advanced.
Stocks in Spotlight:
HDFC Bank dropped 4.53%. The private lender's net profit rose 22.83% to Rs 10,055.18 crore on 8.07% increase in total income to Rs 41,085.78 crore in Q4 March 2022 over Q4 March 2021. The bank's profit before tax (PBT) rose 20.35% year-on-year to Rs 13,044.66 crore in Q4 March 2022. The bank's provisions and contingencies (excluding tax provisions) fell 29.43% to Rs 3,312.35 crore in Q4 March 2022 over Q4 March 2021.
The bank's gross non-performing assets (NPAs) stood at Rs 16,140.96 crore as on 31 March 2021 as against Rs 15,086 crore as on 31 December 2021 and Rs 16,013.55 crore as on 31 March 2020. The ratio of gross NPAs to gross advances stood at 1.17% as on 31 March 2021 as against 1.32% as on 31 December 2021 and 1.26% as on 31 March 2020. The ratio of net NPAs to net advances stood at 0.32% as on 31 March 2021 as against 0.40% as on 31 December 2021 and 0.37% as on 31 March 2020.
Infosys slumped 7.16%. The IT firm's consolidated net profit fell 2.1% to Rs 5,686 crore on a 1.3% increase in revenues to Rs 32,276 crore in Q4 FY22 over Q3 FY22. Meanwhile, on a year-on-year basis, Infosys' net profit and revenue in Q4 FY22 increased 12% and 22.7%, respectively. In dollar terms, the company reported revenues of $4,280 million, registering a growth of 18.5% YoY for the quarter ended 31 March 2022.
Revenues in constant currency terms grew by 20.6% YoY and 1.2% QoQ. Operating margin for the quarter stood at 21.5%, a decline of 3% YoY and 2% QoQ. For the quarter ended 31 March 2021, Free cash flow (FCF) was Rs 5,769 crore, registering a YoY decline of 0.9% while FCF conversion was at 101.3% of net profit. Infosys said growth was broad-based, supported by continued momentum in large deal wins with total contract value (TCV) of large deal wins was $2.3 billion in Q4 FY22.
ICICI Prudential Life Insurance Company rose 0.95%. The company recorded a net profit of Rs 184.67 crore in Q4 FY22, which is higher 189.5% as compared with the same period last year. The company had reported a net profit of Rs 63.78 crore in Q4 FY21. Net premium income declined by 4.4% to Rs 11,358.91 crore in Q4 FY22 from Rs 11,879.28 crore in Q4 FY21.
The life insurer reported 21.5% fall in net profit to Rs 754.13 crore despite a 3.9% rise in net premium income to Rs 36,321.27 crore in FY22 over FY21. The life insurer's claims and benefit payouts increased by 29.7% to Rs 29,359 crore in FY22 from Rs 22,641 crore in FY21 primarily on account of increase in surrenders and withdrawals and death claims. The company had COVID-19 claims (net of reinsurance) of Rs 1,017 crore.
Maruti Suzuki India gained 1.33%. Shares of car manufacturer gained in a weak market after the company announced increase in prices across models owing to increase in various input costs. The weighted average increase across models is in ex showroom prices for Delhi will be around 1.3%. The new prices will come into effect from 18 April 2022.
Jubilant Ingrevia jumped 5.89%. The company bagged a CDMO contract for an estimated value of Rs 270 crore in the specialty chemicals business, spanning over a period of three years, from one of its international customers. The company's international customer is among the top 10 leading innovator pharmaceutical companies globally.
Through the contract, the company will supply two key GMP intermediates for one of the 'patented drugs' of the innovator pharmaceutical customer. Both these products involve seven steps specialised chemistry. Commercial supplies of both these products will start from FY23 onwards. The company will use GMP facility to service this contract.
Tata Steel advanced 2.28%. The steel major's board will consider a stock split proposal on 3 May 2022. On 3 May 2022, the board will also consider Q4 March 2022 results and recommend dividend, if any, for the financial year ended 31 March 2022. Tata Steel group is among the top global steel companies with an annual crude steel capacity of 34 million tonnes per annum.
Tata Power Company added 1.57%. The company, along with BlackRock Real Assets-led consortium, including Mubadala Investment Company, have entered into a binding agreement to invest in Tata Power Renewable Energy, the company's renewable energy subsidiary. BlackRock Real Assets, together with Mubadala, shall invest Rs 4,000 crore (approximately $525 million) by way of equity / compulsorily convertible instruments for a 10.53% stake in Tata Power Renewables, translating to a base equity valuation of Rs 34,000 crore. The final shareholding will range from 9.76% to 11.43% on final conversion.
The newly created platform will consist of five distinct businesses delivering long-term, customer oriented solutions. It will house all renewable energy businesses of Tata Power including those in utility scale solar, wind & hybrid generation assets; solar cell & module manufacturing; engineering, procurement and construction (EPC) contracting; rooftop solar infrastructure; solar pumps and electric vehicle charging infrastructure. The broad-based portfolio of assets ensures diversified yet stable revenue sources including 25-year fixed-price PPAs for grid connected utility scale projects.
Global Markets:
The Dow Jones Futures were down 95 points, indicating a negative start to the US market.
Asian stocks settled on a mixed note on Monday, with investors reacting to the release of Chinese economic data, including first-quarter gross domestic product figures. China has reported gross domestic product of 4.8% in the first quarter of 2022, as against 4% in the fourth quarter. Markets in Australia and Hong Kong were closed on Monday for a holiday.
In Europe, the European Central Bank (ECB) kept its monetary policy unchanged last Thursday but confirmed it will end its bond buying in the third quarter. Once the bond buying program is completed, the ECB is expected to begin hiking interest rates, following the same path as the other major central banks across the globe.
Powered by Capital Market - Live News
Disclaimer: No Business Standard Journalist was involved in creation of this content
