Sensex ends 88 points lower; Tata Group shares weigh

Tata Group shares were among the top losers while Adani Ports emerged as the top gainer

Benchmark share indices ended lower on Tuesday with Tata Group leading the decline after the sudden exit of Cyrus Mistry as chairman of Tata Sons weighed on investor sentiment.

The S&P BSE Sensex ended down 88 points at 28,091 and the Nifty50 settled 18 points lower at 8,691. In the broader market, the BSE Midcap ended down 0.3% while the BSE Smallcap index ended flat. Market breadth ended weak with 1451 losers and 1293 gainers on the BSE.

"The market languished in a negative zone due to unfavorable winds from earnings and ambiguity over TATA Group issue. Investors are eyeing more cues from earnings season and at the same time expecting more volatility as expiry get nearer." Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services

Foreign institutional investors were net sellers in equities worth Rs 325 crore on Monday, as per provisional stock exchange data.

Meanwhile, PNB Housing Finance which launched its initial public offer today raised over Rs 890 crore from allotment of shares to anchor investors such as SBI Life Insurance, HDFC, Axis Mutual Fund and Franklin Templeton Mutual FUnd among others.

Corporate Buzz

In a surprise move, Tata Sons said its board has removed Cyrus Pallonji Mistry as chairman of the conglomerate and named Ratan Tata as interim chairman for four months.

Tata Steel eased over 2.5% while TCS slipped 1% and Tata Motors settled over 1% lower. Among others, Tata Coffee, Tata Global Beverages and Tata Metaliks ended down 2%-4.5% each.

Earnings Impact

HDFC Bank ended down 1.2%. Net revenue at Rs 9,233 crore expanded by 18 per cent year-on-year, slightly below Bloomberg estimates at Rs 10,144 crore. However, net profit stood at Rs 3,455 crore, 20.4 per cent year-on-year growth in quarter ended September’16. This was in line with Bloomberg estimates of Rs 3,456 crore.

Dr Reddy's Labs ended up 1.7% after the company said that all major businesses have shown sequential improvement over the previous quarter with revenues up 11% and EBITDA 61%. However, the pharma major reported a decline of 60% in consolidated net profit for the September quarter at Rs 31 crore, mainly because of drop in sales in Venezuela and North America.

Adani Ports and Special Economic Zone surged over 9% after the company reported a better-than-expected 61% year on year (YoY) jump in its consolidated net profit at Rs 1,091 crore for the quarter ended September 30, 2016 (Q2FY17), on back of strong volume growth. Adani Group Company had profit of Rs 836 crore in the same quarter last fiscal.

Asian Paints ended nearly 2% higher after the company posted a net profit of Rs 435 crore for the quarter ended September 2016 compared with Rs 371 crore for the same quarter last fiscal.

FMCG majors ITC and Hindustan Unilever ended down 1%-2% each ahead of their second quarter earnings on Wednesday.

Among other index heavyweights HDFC and Infosys ended down 1% each.

Broader Markets

Arvind jumped nearly 13% after the company announced dilution of 10% stake in Arvind Fashions to private equity (PE) firm founded by Renuka Ramnath for Rs 740 crore.

Symphony zoomed 20% after the company reported a net profit of Rs 39 crore for the quarter ended September 2016 compared to Rs 29 crore in the same quarter last fiscal.

Bharti Infratel ended up 2% on the back of heavy volumes after the company reported 31% year on year (YoY) jump in consolidated net profit at Rs 774 crore for the quarter ended September 2016 (Q2FY17).

Federal Bank ended at its lifetime high of Rs 81, up 8% on BSE after the bank reported 25% year on year (YoY) growth in net profit at Rs 201 crore for the quarter ended September 30, 2016 (Q2FY17).