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Nifty hovers below 11,850; IT shares correct

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Key benchmark indices were trading near the day's low in morning trade, mirroring weakness in other Asian peers. The Nifty slipped below the 11,850 mark after rising in the past nine sessions. Profit booking emerged after International Monetary Fund (IMF) slashed India's economic growth forecast in the wake of the coronavirus pandemic. IT shares corrected on profit booking.

At 10:28 IST, the barometer index, the S&P BSE Sensex, was down 249.39 points or 0.61% at 40,376.12. The Nifty 50 index lost 87.50 points or 0.73% to 11,847.

In the broader market, the S&P BSE Mid-Cap index declined 0.09% while the S&P BSE Small-Cap index fell 0.39%.

The market breadth was weak. On the BSE, 780 shares rose and 1315 shares fell. A total of 105 shares were unchanged.


The International Monetary Fund (IMF) on Tuesday said it expects India's gross domestic product (GDP) to decline by 10.3% in FY21. It is expected to rebound by 8.8% in 2021. The IMF has revised India's GDP growth, since its June forecast of a 4.5% drop, while reflecting a severe-than-anticipated contraction in economic activities in Q1 FY21, amid the nationwide lockdown due to the COVID-19 pandemic.

Q2 Earnings:

Among the Nifty stocks, Infosys was down 1.16% ahead of its quarterly earnings today.

Aditya Birla Money (down 2.65%), Den Networks (down 2.48%), Goa Carbon (down 1.97%), Tata Elxsi (down 0.75%), Tata Steel BSL (up 0.68%) and Titagarh Wagons (up 0.23%) will also announce quarterly earnings today.

Buzzing Segment:

The Nifty IT index slipped 1.10% to 22,245.15. The index had gained 18.55% in the past twelve sessions.

Coforge (down 4.40%), HCL Tech (down 1.44%), MindTree (down 1.37%), Tech Mahindra (down 1.27%) and TCS (down 0.74%) declined.

Mphasis (up 2.5%), Larsen & Toubro Infotech (up 2.39%) and Info Edge India (up 1.45%) advanced.

Wipro dropped 6.19% to Rs 352.60 after the IT major's consolidated net profit declined 3.4% to Rs 2,465.70 crore on 0.1% fall in net sales to Rs 15,114.50 crore in Q2 September 2020 over Q2 September 2019. Sequentially, consolidated net profit rose 3.02% and revenue increased 1.35% in Q2 September 2020 (Q2FY21) over Q1 June 2020 (Q1FY21).

Wipro's IT services segment revenue for the September quarter came in at $1,992.4 million, an increase of 3.7% quarter-on-quarter (QoQ). IT services operating margin for the quarter was at 19.2%, an expansion of 0.2% QoQ and 1.1% year-on-year (YoY).

Wipro expects revenue from its IT services business to be in the range of $2,022 million to $2,062 million in Q3 December 2020, a sequential growth of 1.5% to 3.5%.

Meanwhile, the board of IT services company approved a plan to buyback 23.75 crore shares at Rs 400 per equity share for an aggregate amount not exceeding Rs 9,500 crore. This represents 4.16% of total paid-up equity share capital of the company as on 30 September.

Further, Wipro announced that it has signed a definitive agreement to acquire Eximius Design, a leading engineering services company with strong expertise in semiconductor, software and systems design.

Stocks in news:

Tata Steel Long Products hit an upper circuit of 20% at Rs 403.20 after the company reported a consolidated net profit of Rs 59.06 crore in Q2 FY21 as against a net loss of Rs 188.48 crore in Q2 FY20. Net sales during the quarter jumped 52.5% year-on-year (YoY) to Rs 1185.86 crore in Q2 FY21.

NTPC fell 3.33% to Rs 79.95. The state-run power major has decided to raise Rs 4,000 crore on 15 October 2020, through private placement of unsecured non-convertible bonds in the nature of debentures at a coupon of 5.45% per annum with a door to door maturity of 5 years on 15 October 2025. The proceeds will be utilized for, inter alia, funding of capital expenditure, refinancing of existing loans and other general corporate purposes. The bonds are proposed to be listed on both NSE & BSE.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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First Published: Wed, October 14 2020. 10:29 IST