A rapidly rising number of Covid-19 infections in India and the resultant deaths also put pressure on bourses. India reported over 14,759 cases of COVID-19 infection and over 590 deaths, according to the data from the Ministry of Health and Family Welfare, Government of India.
The barometer S&P BSE Sensex slumped 1011.29 points or 3.20% to 30,636.71. The Nifty 50 index lost 280.40 points or 3.03% at 8,981.45.
In the broader market, the S&P BSE Mid-Cap index declined 2.73% while the S&P BSE Small-Cap index slipped 2.96%. The decline in both these indices was lower than the decline in the Sensex.
Dr. Reddy's Laboratories (up 4.38%), Bharti Infratel (up 2.89%), Bharti Airtel (up 2.18%), Hero MotoCorp (up 1.61%) and Britannia Industries (up 0.95%) were the top Nifty gainers.
IndusInd Bank (down 12.25%), Bajaj Finance (down 9.07%), ICICI Bank (down 8.72%), Hindalco Industries (down 8.07%) and Axis Bank (down 7.96%) were the top Nifty losers.
Sellers outpaced buyers. On the BSE, 738 shares rose and 1674 shares fell. A total of 153 shares were unchanged. In Nifty 50 index, only 8 stocks advanced while 42 stocks declined.
Buzzing Index:
The Nifty IT index fell 3.64% to 12,380.30, amid profit booking. The index has added 3.08% in two sessions.
MphasiS (down 9.55%), MindTree (down 5.74%), Hexaware Technologies (down 3.78%), HCL Technologies (down 3.21%), Persistent Systems (down 3.03%), Tech Mahindra (down 2.4%) and Wipro (down 1.52%) declined.
IT stocks came under pressure after US President Donald Trump said that he will suspend all immigration into the United States temporarily through an executive order in response to the coronavirus outbreak and to protect American jobs. The Indian information technology services industry is a big beneficiary of US work visas.
"In light of the attack from the Invisible Enemy, as well as the need to protect the jobs of our GREAT American Citizens, I will be signing an Executive Order to temporarily suspend immigration into the United States," Trump said in a tweet.
In response to the President's tweet, India's IT services industry body NASSCOM tweeted: "NASSCOM seeks details on the Executive Order of the President of the United States suspending immigration temporarily."
Index major TCS fell 4.61%. TCS and Amway, a global leader in direct selling, have entered into a strategic partnership to transform the latter's global technology operations. Amway was looking to transform its IT infrastructure and operations and its global service desk in order to improve agility, accelerate speed to market, and enhance customer experience.
Earnings Impact:
Infosys slipped 3.05% to Rs 633. The IT major said its consolidated net profit (after minority interest) fell 3.1% to Rs 4,321 crore on 0.8% rise in revenues to Rs 23,267 crore in Q4 March 2020 over Q3 December 2019. Consolidated operating profit fell 2.7% to 4,927 crore in Q4 March 2020 over Q3 December 2019. Operating margin stood at 21.2% in Q4 March 2020 lower than 21.9% in Q3 December 2019. The result was announced after trading hours on Monday, 20 April 2020.
"Considering the business uncertainty emanating from COVID-19, the company is unable to provide guidance on revenues and margins for FY 21 at this stage. The company will provide guidance after visibility improves," Infosys said in a release.
Digital revenues stood at $1,341 million (41.9% of total revenues) in Q4 March 2020, year-on-year growth of 31.7% and sequential growth of 2.6% in constant currency.
Infosys' consolidated net profit (after minority interest) rose 7.7% to Rs 16,594 crore on 9.8% rise in revenues to Rs 90,791 crore in the year ended March 2020 (FY20) over the year ended March 2019 (FY19). Operating margin stood at 21.3% in FY20, lower than 22.8% in FY19. Infosys announced final dividend of Rs 9.50 per share.
The company had approximately $3.605 billion (Rs 27,276 crore) in cash and cash equivalents including investments with zero debt as of 31 March 2020.
In its update on whistleblower matters, Infosys said it is presently unable to predict the scope, duration or the outcome of these matters.
Tata Elxsi slipped 0.72% to Rs 724.50 after the company announced decent number for Q4 March 2020 after market hours yesterday. Net profit rose 8.9% to Rs 82.08 crore on 3.65% rise in net sales to Rs 438.89 crore in Q4 March 2020 over Q3 December 2019. The company has also declared a final dividend of Rs 16.50 per share.
Profit before tax (PBT) rose 2.8% year-on-year (YoY) to Rs 109.76 crore, due to higher total expenditure (up 7.7% YoY). Tax expenses fell 25.6% to Rs 25.79 crore in Q4 March 2020 over Q4 March 2019.
Linde India fell 2.77% to Rs 523. The company's consolidated net profit rose 9.7% to Rs 39.03 crore in Q1 March 2020 over Q1 March 2019. Net sales, however, declined 14.5% to Rs 377.26 crore during the period under review.
The company's profit before tax (PBT) rose 8.7% year-on-year (YoY) to Rs 56.59 crore in Q1 March 2020, due to lower total expenditure (down 11.6% YoY) and lower interest payments (down 87.2% YoY). In view of the unprecedented COVID-19 pandemic and economic forecasts, the management has evaluated the impact on its financial results for the current quarter and made appropriate adjustment to revenue, debtors provisioning and actuarial assumptions.
Stocks in Spotlight:
ICICI Bank tumbled 8.28% to Rs 331.55 after the media reported that the bank has an exposure of $100 million to Ocean Tankers, a unit of Singapore oil-trading firm Hin Leong Trading (HLT), that has filed for bankruptcy in Singapore.
The media reported that HLT and its sister company Ocean Tankers both filed for bankrutpcy on Friday (17 April) which will give 30 days to restructure debt. HLT, one of Singapore's largest independent oil traders, has total debt of close to $4 billion.
According to media reports, ICICI Bank has lent $100 million to Ocean Tankers, out of which $75 million is secured through inventory. ICICI Bank has reportedly issued notices to impound two vessels operated by Ocean Tankers.
Meanwhile, ICICI Bank clarified to the bourses on Tuesday, 21 April 2020, that the bank, in the normal course of its business, has exposure to the borrower group in question, is taking due steps to protect its interests, and will appropriately reflect the same in its financial statements, as it would do in respect of all its banking exposures.
Bandhan Bank tumbled 9.25% to Rs 196.10. The latest shareholding pattern showed that Caladium Investment, an affiliate of GIC, Singapore's Sovereign Wealth Fund hiked its stake in Bandhan Bank to 4.49% in March quarter from 3.39% in December quarter.
Aurobindo Pharma spurted 19.73% to Rs 647.20 after the pharmaceutical major informed the exchanges that the USFDA inspection conducted last year on Unit IV facility, has been given a 'Voluntary Action Indicated' (VAI) classification.
Morepen Laboratories was locked in an upper circuit of 10% at Rs 16.07 after the company said it has received license to manufacture Hydroxychloroquine (HCQ) from State Drug Controller, (HP) last week for its Baddi plant in Himachal Pradesh. The company said it is working to commercialize the production of Hydroxychloroquine in both API as well as tablets form. HCQ is a prescription based drug commonly being recommended to Corona patients under treatment for the disease.
Larsen & Toubro (L&T) fell 5.03% to Rs 870. The company said that its construction arm has secured orders from clients for its varied businesses. As per the L&T's classification, the valuation of the 'significant' order stands between Rs 1,000 crore and 2,500 crore.
Shriram Transport Finance Company slumped 13.91% to Rs 590. The company said its board approved issuing redeemable non-convertible debentures/subordinated debentures on private placement basis for purpose of business of the company. The company has sought shareholders' approval for the renewal of limits to issue debentures on private placement basis by the board upto Rs 35,000 crore for the purpose of the business of the company.
JMC Projects (India) hit a lower circuit of 5% at Rs 42.55. The construction company said that as per the directions received from the government, all four road project special purpose entity vehicles (SPVs) of the company have resumed collecting user fee at all toll plazas on National Highways with effect from 20 April 2020.
Global Markets:
Markets in Europe and Asia fell across the board on Tuesday as coronavirus concerns and the oil market volatility weighed on the investor sentiment.
In US, stocks finished near session lows Monday as investors watched oil futures crash, overshadowing optimism about plans for a staggered easing of global lockdowns in the wake of the COVID-19 pandemic.
The futures contract for US crude prices crashed and turned negative for the first time in history on Monday, amid a demand collapse due to the coronavirus pandemic. On 20 April, West Texas Intermediate (WTI) settled at -$37.63 a barrel, after going as low as -$40.32. This negative price has never happened before for an oil futures contract.
The June WTI contract, which expires on 19 May, fell about 18% to settle at $20.43 per barrel. Meanwhile, the international benchmark, Brent crude, which has already rolled to the June contract, fell 8.9% to $25.57 per barrel.
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