Equity indices witnessed volatile trading and ended with modest losses on Thursday. Sentiment was weak as surging Covid-19 infections in US and Europe clouded the global economic outlook. Uncertainty over next week's U. S. Presidential elections also worried investors. Barring the Nifty IT index, all other sectoral indices on the NSE ended in the red. The Nifty closed below 11,700 mark.
As per provisional closing data, the barometer index, the S&P BSE Sensex slumped 172.61 points or 0.43% at 39,749.50. The Nifty 50 index lost 58.8 points or 0.5% at 11,670.10.
In broader market, the S&P BSE Mid-Cap index declined 0.01% while the S&P BSE Small-Cap index fell 0.55%.
The market breadth was weak. On the BSE, 1043 shares rose and 1554 shares fell. A total of 179 shares were unchanged.
Total COVID-19 confirmed cases worldwide stood at 4,44,83,775 with 11,74,053 deaths.
India reported 6,03,687 active cases of COVID-19 infection and 1,20,527 deaths while 73,15,989 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
Canara Bank (down 1.67%), Blue Dart Express (up 1.2%), InterGlobe Aviation (up 3%), JK Paper (down 1.32%), MRPL (down 0.18%), Tata Chemicals (up 1.12%), TVS Motor Company (down 1%), Vodafone Idea (down 2.88%) and Zensar Technologies (down 0.45%) are some of the companies that will announce quarterly earnings today.
Hero MotoCorp fell 1.82%. The two-wheeler major's standalone net profit jumped 9% to Rs 953.45 crore on 23.7% increase in net sales to Rs 9,367.34 crore in Q2 September 2020 over Q2 September 2019. Volumes grew 7.7% to 18.22 lakh units sold in Q2 FY21 over Q2 FY20. EBITDA jumped 16.80% to Rs 1,286 crore in Q2 September 2020 as against Rs 1,101 crore in Q2 September 2019. EBITDA margin stood at 13.7% in Q2 FY21, higher than 3.6% in Q1 FY21 and lower than 14.5% in Q2 FY20.
L&T dropped 5%. On a consolidated basis, Larsen & Toubro (L&T)'s net profit surged 118.43% to Rs 5,520.27 crore on 12.15% decline in net sales to Rs 31,034.74 crore in Q2 September 2020 over Q2 September 2019. Profit was boosted due to divestment of Electrical & Automation (E&A) business to Schneider Electric SE on 31 August 2020. Profit after tax from discontinued operations for the quarter and six months ended 30 September 2020 includes gain on divestment Rs 8,101.04 crore (net of tax). During the quarter, with the labour at various project sites reaching near pre-covid levels, the businesses saw a pickup in execution momentum compared to Q1 FY21 and achieved a sequential growth of 46%. The revenue, however, declined by 12% y-o-y due to the lingering impact of the pandemic during the quarter under review. International revenue during the quarter at Rs 12,148 crore constituted 39% of the total revenue, L&T said in a statement.
Axis Bank declined 2.35%. The private lender reported a net profit of Rs 1,683 crore in Q2 September 2020 as against net loss of Rs 112 crore in Q2 September 2019. Total income during the quarter rose 2.8% year-on-year (YoY) to Rs 19,870.07 crore in Q2FY21.
Net interest income (NIM) jumped 20% to Rs 7,326 crore in Q2FY21 over Q2FY20. Net interest margin in Q2FY21 was 3.58% as against 3.51% for Q2FY20. The bank's provisions and contingencies increased by 30.2% to Rs 4,580.65 crore in Q2 FY21 from Rs 3,518.39 crore in Q2 FY20. As on 30 September 2020, the bank's provision coverage, as a proportion of gross NPAs, stood at 77%, as compared to 62% as at 30 September 2019 and 75% as at 30 June 2020. Specific loan loss provisions for Q2FY21 were Rs 588 crore, compared to Rs 2,701 crore in Q2 last year. The bank held additional provisions of around Rs 6,898 crores towards various contingencies at the end of Q1FY21. The bank has made incremental provisions of Rs 1,279 crores towards loans under moratorium and Rs 1,864 crores towards probable restructuring, aggregating to Rs 3,143 crores. As at 30 September, 2020, the bank held in aggregate additional provisions of Rs 10,839 crore.
Glaxosmithkline Pharmaceuticals slipped 1.17% after the company reported 84.8% fall in consolidated net profit to Rs 76.47 crore on a 0.3% decline in net sales to Rs 879.32 crore in Q2 FY21 over Q2 FY20. The company incurred an exception expenditure of Rs 64.13 crore during the quarter, due to the decision to initiate a global voluntary recall (pharmacy/retail level) of ranitidine products including Zinetac in India.
Navin Fluorine International jumped 7.17% after the chemical maker posted a 43% jump in consolidated net profit to Rs 67.81 crore in Q2 September 2020 from Rs 47.34 crore in Q2 September 2019. Consolidated net sales for Q2 September 2020 stood at Rs 318.92 crore, rising 17% from Rs 272.94 crore in Q2 September 2019. The company said total revenue is returning back to normal in Q2.
PI Industries rose 2.31% after the company's net profit surged 77% to Rs 217.60 crore on 27.6% increase in net sales to Rs 1,157.70 crore in Q2 FY21 over Q2 FY20. EBITDA rose by 45% to Rs 280 Q2 September 2020 from Rs 193 crore in Q2 September 2019. EBITDA margin stood at 24% as on 30 September 2020 as against 21% as on 30 September 2019. Profit before tax in the second quarter stood at Rs 262.70 crore, up by 55.2% from Rs 169.30 crore in the same period last year. Current tax expense declined 13.5% year-on-year (YoY) to Rs 36.60 crore during the quarter.
Stocks in Spotlight:
Pidilite Industries jumped 5% after the company signed a definitive agreement with Huntsman Group (USA) for acquiring a 100% stake in one of its subsidiaries in India, Huntsman Advanced Materials Solutions (HAMSPL), for Rs 2,100 crore. In 2019, business revenue for HAMPSL was approximately Rs 400 crore. In addition to the Indian sub-continent business, the acquisition includes a trademark licence for Middle East, Africa and ASEAN countries.
Ajanta Pharma advanced 3.2% after the company said its board will consider share buyback on Tuesday, 3 November 2020.
Housing and Urban Development Corporation (HUDCO) rose 0.16%. HUDCO said it has achieved loan sanctions of Rs 2,628.23 crore and loan releases of Rs 3,411.79 crore, as on 30 September 2020, for the financial year 2020-21.
European shares were trading higher, recovering from a sharp drop on Wednesday as the new wave of COVID-19 cases sweep through Europe.
German officials agreed to a four-week partial lockdown, while the French government imposed new nationwide restrictions until December 1. In the US, the state of Illinois has ordered Chicago to shut down indoor dining. The British government is also under pressure to tighten restrictions with cases doubling every nine days.
Most Asian indices declined on Thursday following an overnight plunge on Wall Street as coronavirus cases continued to surge in the West. Worsening matters for investor enthusiasm were dwindling hopes for any imminent US economic relief package with a presidential election less than a week away.
Japan's retail sales fell 8.7% in September as compared to a year earlier, according to the Ministry of Economy, Trade and Industry's Preliminary Report on the Current Survey of Commerce released Thursday.
In US, stocks tumbled on Wednesday, amid concerns over the latest increase in coronavirus infections and its potential impact on the global economy. The Dow Jones Industrial Average fell 943.24 points, or 3.43%, to 26,519.95, the S&P 500 lost 119.65 points, or 3.53%, to 3,271.03 and the Nasdaq Composite dropped 426.48 points, or 3.73%, to 11,004.87.
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