Weekly: Markets end flat, broader markets underperform

Realty index top sectoral loser

Markets ended marginally lower for the week ended February 15 amid selling pressure in mid-caps, small-caps, realty and capital goods stocks.

The Sensex closed marginally down by 0.09% or 17 points to end at 19,468 and the 50-share Nifty slipped 16 points or 0.27% to 5,887, its lowest closing level since 27 December 2012.

However,  the broader markets continued to witness selling pressure underperforming the benchmark indices. The BSE mid-cap index fell 1.9% or 129 points to close at 6,626 and the small-cap index plunged 3.7% or 253 points to close the week at 6,540 levels.

Meanwhile, on the macro economic front, the wholesale price index (WPI)-based inflation fell to 6.62% in January, the lowest since December 2009, even as surging onion prices saw food inflation soaring to 11.88%, according to data released by the Ministry of Commerce and Industry on Thursday.

January was the fourth consecutive month when WPI inflation fell. In December 2012, it stood at 7.18%, while food inflation was 11.16%.

Realty stocks were amongst the hard hit stocks in this week's trade. The BSE realty index cracked 5.4% or 116 points to end at 2,036. Capital goods, power, metal, consumer durables, oil & gas, teck and FMCG indices also closed on a weak note. While, PSU, healthcare, bankex, auto and IT indices closed on a flat note with a positive bias.

Unitech from realty space was the top loser, the stock fell 13.5% to Rs 30 after the Central Bureau of Investigation (CBI) suspected that its own prosecutor of aiding Unitech, managing director Sanjay Chandra, one of the accused in the 2G case.

However, the company reported better than expected third quarter results. The net profit jumped 52.43% to Rs 84.17 crore for the third quarter ended December 2012 on higher sales realisation and lower finance cost. It had posted a net profit of Rs 55.22 crore in the same quarter previous year. Anant Raj Industries, DLF and HDIL from this space also fell 6-7% each.

On the earnings front, India's largest public sector lender, the State Bank of India disappointed the market as it posted a mere 4% rise in net profit at Rs 3,396 crore for the third quarter ended December 2012, as compared to Rs 3,263 crore in the December 2011 quarter, due to decline in net interest income (NII). Investors were also disappointed due to a Rs 8,175 crore rise in fresh slippages. The stock closed 2.3% lower at Rs 2,235 on the Bombay Stock Exchange on a weekly basis.

Net slippages (excluding upgradation and recovery) were Rs 4,256 crore. The SBI management says sectors such as pharmaceuticals and steel-related units in Karnataka (where the Supreme Court had banned the mining of iron ore but later partially lifted it) contributed to the slippage.

Tata Motors announced its December quarter results (Q3). The consolidated net profit of the India's largest vehicle maker plunged 52% to Rs 1,627 crore for the quarter ended December 2012, a huge fall considering that the figure was Rs 3,405 crore during the corresponding quarter in FY12. This is the lowest net profit for the company in three years.

Company's standalone performance recorded its first net loss in four years at Rs 458 crore for the quarter under review, compared with a net profit of Rs 173 crore recorded in the year-ago period.

Tata Motors said slowing demand and rising competition is mainly responsible for the dismal performance in the recently-concluded quarter. However, the stock was the top Sensex gainer of the week. It advanced 6.5% to close at Rs 304.

Tata Steel's consolidated net loss for the third quarter went up 27% to Rs 763 crore from Rs 602 crore in the corresponding period last year. The loss was the biggest quarterly one in more than three years.

Decreased demand in Europe and closure of a blast furnace affected the revenues, down 4% to Rs 32,163 crore from Rs 33,357 crore in the year-ago period. Europe deliveries for the quarter were lower at 3.02 million tonnes (mt) compared with 3.35 mt in the corresponding quarter last year. “Tata Steel posted disappointing results, with both sales and net profit below our expectations," said Bhavesh Chauhan, senior research analyst, Angel Broking.

Aditya Birla’s flagship company, Hindalco Industries, reported a 4% drop in net profit for the third quarter ended December 31. Its standalone profit stood at Rs 434 crore against Rs 451 crore in the corresponding quarter last year.

GAIL India reported rise of 17.72% in its net profit which came in at Rs 1284.86 crore on the back of 11.87% increase in total income to Rs 12,658.37 on a YOY basis.

Among the Sensex stocks, Maruti Suzuki was the top loser, down 7.3% to close at Rs 1,472. Jindal Steel, L&T, Bajaj Auto, Wipro, hero MotoCorp, Tata Steel and index heavyweight Reliance Industries were also among the major losers down 2-6% each. While, Sun Pharma, HDFC Bank, Coal India, ONGC, HUL, Mahindra & Mahindra, NTPC and TCS were among the notable gainers on the Sensex.