Shares hit day's low; breadth negative

Key domestic benchmarks extended losses and hit fresh intraday low in morning trade. A weak economic outlook by the US Fed weighed on global stock markets. Worries about a second wave of coronavirus infections also impacted trading sentiment. Investors shrugged off a number of measures announced by the Indian government to support MSMEs and NBFCs.

At 10:28 IST, the barometer index, the S&P BSE Sensex, was down 636.47 points or 1.99% at 31,372.14. The Nifty 50 index was down 177.50 points or 1.89% at 9,206.05.

In the broader market, the S&P BSE Mid-Cap index added 0.10% while the S&P BSE Small-Cap index lost 1.27%.

The market breadth, indicating the overall health of the market, was negative. On the BSE, 702 shares rose and 1009 shares fell. A total of 90 shares were unchanged. In the Nifty 50 index, 9 shares advanced while 41 stocks declined.

Q4 Results Today:

AAVAS Financiers (up 2.26%), Biocon (up 0.50%), Indiabulls Real Estate (up 2.22%), Mahindra Lifespace Developers (up 0.46%), Escorts (down 2.49%), Indian Energy Exchange (down 0.16%), Manappuram Finance (up 0.99%), Oracle Financial Services Software (down 0.28%), Tata Consumer Products (up 1.21%), TV Today Network (down 1.04%) Mahindra EPC Irrigation (up 2.11%) and Zensar Technologies (up 1.4%) are some of the companies that will announce their quarterly results today.

Earnings Impact:

Godrej Consumer Products added 5.70% to Rs 565. On a consolidated basis, Godrej Consumer Products reported a 75.42% drop in net profit to Rs 229.90 crore on a 12.2% drop in net sales to Rs 2132.69 crore in Q4 March 2020 over Q4 March 2019.

Consolidated profit before tax (PBT) fell 32.54% to Rs 337.30 crore in Q4 March 2020 over Q4 March 2019. Consolidated business EBITDA declined 18% year on year (YoY) in Q4 March 2020 while consolidated constant currency EBITDA declined by 15% year-on-year in the same period. The company said consolidated EBIDTA margins declined to 22.3%.

The company said it has temporarily deferred its outlook for FY21 driven by progression of COVID-19 and related uncertainties. The company said complete pause on sales due to disruption of both back end and front end supply chain took a hit.

ABB India slipped 0.86% to Rs 848.70 after it reported 25.84% fall in profit after tax to Rs 66 crore on a 17.73% decline in revenues to Rs 1,522 crore in Q1 March 2020 over Q1 March 2019. Orders rose 9.72% to Rs 1,953 in Q1 CY2020 from Rs 1,780 in Q1 CY2019.

Operational EBITA contracted by 65.87% to Rs 43 crore in Q1 March 2020 from Rs 126 crore in Q1 March 2019. Operational EBITA margin stood at 2.8% in Q1 CY2020 as compared to 6.8% in Q1 CY2019. Profit before tax in the first quarter of CY2020 fell to Rs 87 crore, down by 37.41% from Rs 139 crore reported in the corresponding period last year.

Offering comments on the short term outlook, the company said that the impact of COVID-19, as well as the fall in oil prices, has significantly impacted the short-term outlook. While the company is taking prompt action to adapt its operations and cost base to safeguard profitability, it expects the results in the coming quarter to be impacted due to the loss of volumes. Despite short-term disruptions, ABB is confident in the underlying resilience of its businesses and operating model. The company has a strong balance sheet and is confident that its liquidity needs will be well covered.

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