A range-bound movement was witnessed as key benchmark indices hovered in negative zone in early afternoon trade. At 12:15 IST, the barometer index, the S&P BSE Sensex was down 133.57 points or 0.47% at 27,996.27. The Nifty 50 index was currently down 35.50 points or 0.41% at 8,663.90. The Sensex was currently trading below the psychologically important 28,000 level. The index swung above and below that level in intraday trade so far. The market breadth indicating the overall health of the market was positive. On BSE, 1,242 shares rose and 1,182 shares declined. A total of 200 shares were unchanged. The BSE Mid-Cap index was currently down 0.11%. The decline in this index was lower than Sensex's decline in percentage terms. The BSE Small-Cap index was currently up 0.1%, outperforming the Sensex.
In overseas stock markets, Asian stocks edged lower after the European Central Bank (ECB) left its policy rate unchanged after the conclusion of a monetary policy meeting. US stocks registered small losses yesterday, 20 October 2016, after a sharp fall in oil prices, while investors parsed through key US economic data.
In Europe, as widely expected, the ECB kept its policy rate unchanged after a meeting yesterday, 20 October 2016. Though ECB left its ultra-loose monetary policy unchanged, President Mario Draghi said the European region's central bank had left the door open to more monetary stimulus.
Stocks of public sector banks edged lower. Bank of Baroda (down 1.68%), Indian Bank (down 1.46%), Bank of India (down 1.4%), Union Bank of India (down 1.01%), State Bank of India (down 0.87%) and Punjab National Bank (down 0.55%) declined. IDBI Bank (up 0.14%) edged higher.
Stock of private sector banks were mixed. Axis Bank (down 2.28%), ICICI Bank (down 0.5%) and Yes Bank (down 0.26%) edged lower. IndusInd Bank (up 0.61%), Kotak Mahindra Bank (up 0.32%), RBL Bank (up 0.67%) and HDFC Bank (up 0.1%) edged lower.
IT stocks were mixed. Tech Mahindra (up 1%) and TCS (up 0.55%) edged higher. Infosys (down 0.31%) and Oracle Financial Services Software (down 0.14%) edged lower.
Wipro rose 0.45%. The company is slated to announce Q2 September 2016 results today, 21 October 2016. Wipro after market hours yesterday, 20 October 2016 said it has signed a definitive agreement to acquire Appirio, a global cloud services company that creates next generation worker and customer experiences for a purchase consideration of $500 million. The acquisition is subject to customary closing conditions and regulatory approvals and is expected to be closed in Q3 December 2016.
HCL Technologies edged higher after the company retained revenue growth guidance for the year ending 31 March 2017 (FY 2017) at the time of announcing Q2 September 2016 results before market hours today, 21 October 2016. The stock rose 2.05% at Rs 832. HCL Technologies expects revenue growth between 12% to 14% in constant currency terms in FY 2017. This translates into 11% to 13% growth in dollar terms based on 30 September 2016 exchange rates. HCL Technologies expects its operating margin (EBIT) to be in the range of 19.5% to 20.5% for FY 2017.
The company's consolidated net profit fell 1.6% to Rs 2014 crore on 1.6% growth in revenue to Rs 11519 crore in Q2 September 2016 over Q1 June 2016. Revenue in constant currency rose 2.8% in Q2 September 2016 over Q1 June 2016.
HCL Technologies' CFO Anil Chanana said the conversion of net income to operating cash flow has been in excess of 100% for last twelve months ended 30 September 2016 while the return on equity continues to be robust at 28%.
HCL Technologies announced that C. Vijayakumar, Chief Operating Officer of the company has been elevated to the position of the President and Chief Executive Officer of the company with effect from 20 October 2016. Anant Gupta has decided to leave the company to pursue personal interests outside of HCL.
Separately, HCL Technologies before market hourst today, 21 October 2016 announced that it has entered into an agreement to acquire Butler America Aerospace, LLC (Butler Aerospace), a provider of engineering, design services and aftermarket engineering services to US Aerospace and Defense customers. Butler Aerospace is a wholly owned subsidiary of Butler America LLC. The proposed acquisition will exclude the staffing business of Butler America Inc. The consideration for the proposed transaction is $85 million to be paid in cash. The acquisition is subject to regulatory approvals including CFIUS approval in the US, along with other customary closing conditions. It is expected to be completed by 31 December 2016.
Butler Aerospace had revenues of $85.4 million for the year ended 31 December 2015 at EBIT of 12.2%. The acquisition when consummated is likely to be EPS accretive, HCL Technologies said.
Biocon rose 2.58% at Rs 1,005.50 after the company reported consolidated net profit of Rs 146.70 crore in Q2 September 2016 as compared with net loss of Rs 10.60 crore in Q2 September 2015. The result was announced after market hours yesterday, 20 October 2016.
Biocon's consolidated total income rose 21.2% to Rs 992.50 crore in Q2 September 2016 over Q2 September 2015. Consolidated earnings before interest, taxation, depreciation and amortization (EBITDA) rose 45% to Rs 277 crore in Q2 September 2016 over Q2 September 2015. EBITDA margin improved to 28% in Q2 September 2016 from 23% in Q2 September 2015.
Biocon said that the company reported robust performance led by a strong growth of Small Molecules, Biologics and Syngene. Licensing income stood at Rs 32 crore while other income reported was Rs 52 crore in Q2 September 2016.
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