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| One of four BSE-500 stocks hit 52-week lows | | Rs 250,000 cr of investor wealth lost in three days on poor quarterly results |
| Deepak Korgaonkar / Mumbai Nov 18, 2011, 00:19 IST |
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One of every four stocks from the Bombay Stock Exchange-500 index have hit 52-week lows on poor quarterly results and renewed worries about euro zone debt. Maruti Suzuki, Bharat Heavy Electricals, Larsen and Toubro and Tata Power from the benchmark Sensex, along with as many as 151 stocks from the BSE-500 index, have touched one-year lows in the past three days.
The BSE’s benchmark index has lost four per cent or 657 points in three days to close at 16,462 points on Thursday. Foreign funds reported a net outflow of Rs 1,094 crore from the Indian market, according to data released by the stock exchanges.
Adani Enterprises, Steel Authority of India, Shree Renuka Sugars, Indian Hotels, and Shipping Corporation of India are among notable stocks to hit two-year lows, while SKS Microfinance, Mahanagar Telephone Nigam, GTL, Suzlon Energy, Punj Lloyd and Adani Power hit lifetime lows on the BSE.
In the sectoral classification, the BSE’s capital goods, power and PSU indices hit a 52-week low on Thursday. So did the mid-cap and small-cap indices. The poor financial results for the quarter ended September impacted small-cap and mid-cap companies the most.
“The overall quality of earnings was relatively lower, as profits of oil & gas companies (partly driven by non-core reasons) offset the dip in profitability of metal companies. On a sectoral basis, profit growth was better than expected for oil & gas, financials, FMCG (fast moving consumer goods) and the power sector. Earnings of pharma companies were considerably below expectation and declined sharply even on a yyear-on-year basis,” said Vaibhav Agrawal, vice-president, research, with Angel Broking.
The three state-owned oil marketing companies (BPCL, HPCL and Indian Oil) touched a one-year low after reducing the price of petrol for the first time in 33 months, by Rs 1.85 a litre. These three companies had reported a loss of Rs 14,079 crore during the quarter ended September, as compared to a net profit of Rs 9,526 crore a year before, due to selling fuel at subsidised rates and with the rupee weakening.
The capital goods space faced intense selling pressure, on concern of a slowing in order inflow and lower profit growth. The BSE capital goods index lost nine per cent or 916 points down at 9,584, its lowest level since May 15, 2009.
“The profitability for capital goods companies continued to be muted, as higher interest rates and government policy paralysis hampered new order inflows,” added Vaibhav Agrawal. Investors’ stock market wealth has plunged by around Rs 250,000 crore in three days, after the Sensex hit five-week lows. The total investor wealth, measured in terms of cumulative market value of all listed companies, has plummeted by Rs 241,386 crore to Rs 57,81,537 crore at the end of Thursday’s session.
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