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Benchmarks end near the day`s low; auto stocks outperform

Published on May 13, 2022 16:55

The domestic equity indices ended near the day`s low after a volatile session on Friday. Sharp sell-off in the last hour of trade forced the equity benchmarks to pare all gains and edge lower. The Nifty closed below 15,800 level. Auto, FMCG and pharma shares rose while metal, financial services and bank stocks corrected.

The barometer index, S&P BSE Sensex fell 136.69 points or 0.26% at 52,793.62 . The Nifty 50 index lost 25.85 points or 0.16% at 15,782.15.

The key equity barometers extended losses for sixth consecutive session. The Nifty has fallen 5.40% in six days while the Sensex has declined by 5.22% during the period.

In the broader market, the S&P BSE Mid-Cap index rose 0.79% while the S&P BSE Small-Cap index gained 1.28%.

The market breadth, indicating the overall health of the market, was strong. On the BSE, 2166 shares rose while 1169 shares fell. A total of 137 shares were unchanged.

Economy:

India`s retail inflation, which is measured by the Consumer Price Index (CPI), rose to 7.79% in the month of April 2022. The retail inflation for the month of March was 6.95%. This is the fourth consecutive month that the CPI data has breached the Reserve Bank of India`s (RBI) upper margin of 6%.

India`s factory output, measured in terms of Index of Industrial Production (IIP), witnessed a growth of 1.9% in March 2022. Industrial production grew 1.7% in February 2022. The IIP soared 24.2% in March 2021, the data showed. The manufacturing sector`s output grew 0.9% in March 2022. Mining output rose 4% and power generation increased 6.1%.

India`s merchandise exports moved up 30.7% to $40.19 billion in the month of April, data from the commerce ministry showed on Friday. The trade deficit, although, widened to $20.11 billion, as compared to $15.29 in April 2021. After a record performance in the last financial year, the exports continued robust growth in April, 2022 with merchandise exports scaling a new high by crossing USD 40 billion, the commerce ministry said. Petroleum and crude oil imports during the month gained by 87.54% to $20.2 billion.

Numbers to watch:

The yield on India`s 10-year benchmark federal paper rose to 7.318% as compared with 7.244% at close in the previous trading session.

In the foreign exchange market, the rupee was higher against the dollar. The partially convertible rupee was hovering at 77.49, compared with its close of 77.50 during the previous trading session.

MCX Gold futures for 3 June 2022 settlement fell 0.29% to Rs 50,029.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, fell 0.11% to 104.73.

In the commodities market, Brent crude for July 2022 settlement rose $1.95 or 1.81% at $109.40 a barrel. The contract fell 6 cents or 0.06% to settle at $107.45 a barrel during the previous trading session.

Global Markets:

The Dow Jones futures were up 242 points, indicating a positive opening in the US stock market today.

Shares in Europe and Asia advanced across the board on Friday as global markets looked to regain some ground after a bruising week, with investors assessing the outlook for inflation and interest rates.

U.S. Federal Reserve Chairman Jerome Powell said Thursday that he could not guarantee a so-called �soft landing� that tempers inflation without pushing the economy into recession.

In China, Beijing officials denied the city will be locked down. Residents flocked to grocery stores amid growing concern the Chinese capital will step up curbs to fight a persistent Covid outbreak.

Investors are also monitoring the geopolitical fallout from the war in Ukraine. Russia on Thursday threatened retaliation against Finland after Finnish leaders said the northern European nation must apply to join NATO �without delay.�

European leaders are also facing a race to secure alternative gas suppliers after Moscow announced sanctions on European subsidiaries of its majority state-owned corporation Gazprom. The move came after Ukraine`s state-owned grid operator suspended Russian flows into Europe through a key entry point.

On the data front, French and Spanish inflation figures for April and euro area industrial production readings for March are due on Friday.

In the US, the S&P 500 and the Dow Jones bounced off the day`s low to end slightly lower, but the Nasdaq eked out a modest gain on Thursday. Investors weighed signs of peaking inflation with fears that it could remain elevated. All three major U.S. stock indexes seesawed and the S&P 500 came within striking distance of confirming it entered a bear market.

Buzzing Index:

The Nifty Auto index rose 2.44% to 10,412.35. The index had declined 5.06% in the past five session.

TVS Motor Company (up 5.38%), Ashok Leyland (up 4.38%), Bharat Forge (up 4.15%), Mahindra & Mahindra (up 2.80%), Eicher Motors (up 2.01%), Hero MotoCorp (up 2%), Bajaj Auto (up 1.59%) advanced while Maruti Suzuki declined 2.09%.

Stocks in Spotlight:

Larsen & Toubro (L&T) rose 0.67%. The company`s construction arm secured `significant` contract for its water & effluent treatment business. As per L&T`s classification, the value of the `significant` contract lies between Rs 1,000 crore to Rs 2,500 crore.

L&T had announced its earnings for the quarter and the year ended on 31 March 2022 after market hours yesterday. The engineering and construction major`s consolidated net profit rose 10% to Rs 3620.69 crore on 9.9% increase in revenues to Rs 52850.67 crore in Q4 March 2022 over Q4 March 2021.

Tata Motors surged 8.67%. The company reported a consolidated net loss of Rs 1,032.84 crore in Q4 FY22 as against a net loss of Rs 7,605.40 crore in Q4 FY21.

Siemens added 1.07%. The company reported a standalone net profit of Rs 328.90 crore in Q2 FY 2022, which is marginally higher as compared with a net profit of Rs 328.30 crore recorded in Q2 FY 2021. Net sales during the quarter increased by 8.2% YoY to Rs 3,568.10 crore.

Honeywell Automation India tumbled 7.97%. The company reported 30.1% fall in net profit to Rs 72.67 crore in Q4 FY22 from Rs 104.02 crore in Q4 FY21. Net sales during the quarter declined by 0.7% YoY to Rs 667.98 crore.

State Bank of India (SBI) fell 3.76%. The PSU bank reported 41.28% rise in standalone net profit to Rs 9,114 crore on a 1.58% increase in total income to Rs 82,613 crore in Q4 FY22 over Q4 FY21. Provisions and contingencies declined by 34.51 % to Rs 7,237.45 crore in Q4 FY22 over Q4 FY21. Of this, provision for NPAs were at Rs 3,261.69 crore (down 67.10% YoY) in the fourth quarter.

CreditAccess Gramen jumped 5.93%. The company`s consolidated net profit soared 104.41% to Rs 157.13 crore on 13.5% increase in total income to Rs 824.48 crore in Q4 FY22 over Q4 FY21. On consolidated basis, net interest income (NII) increased by 12.1% YoY to Rs 519.6 crore in Q4 FY22 as against Rs 463.7 crore in Q4 FY21. Net interest margin (NIM) stood at 10.9%.

Emami tumbled 4.93%. The company reported a consolidated net profit of Rs 356.45 crore in Q4 FY22 as against a net profit of Rs 87.73 crore in Q4 FY21. Revenue from operations rose by 5.4% YoY during the quarter to Rs 770.40 crore.

Bandhan Bank advanced 4.34% to Rs 318.20. The bank reported a net profit of Rs 1,902.3 crore in Q4 FY22 as against a net proft of Rs 103 crore in Q4 FY21. Total income increased by 42.6% to Rs 3,504.2 crore in Q4 FY22 from Rs 2,457.4 crore in Q4 FY21.

TV Today Network fell 12.43% to Rs 280.90 after the company`s consolidated net profit fell 1.41% to Rs 35.69 crore on 13.06% rise in net sales to Rs 242.26 crore in Q4 March 2022 over Q4 March 2021.

RBL Bank gained 8.94% to Rs 110.35 after the company reported 162.6% surge in net profit to Rs 197.83 crore on a 5.1% rise in total income to Rs 2,642.31 crore in Q4 FY22 over Q4 FY21.

Matrimony.com zoomed 15.39% to Rs 776.85 after the company`s board approved share buyback worth Rs 75 crore at price not exceeding Rs 1,150 per share.

Matrimony.com recorded 15.6% rise in consolidated net profit to Rs 11.7 crore on a 9.4% increase in revenue to Rs 110.6 crore in Q4 FY22 over Q4 FY21. Consolidated billing during the quarter was at Rs 115.1 crore, up 7.9% YoY.

IPO Update:

The initial public offer (IPO) of Delhivery received bids for 10.16 crore shares as against 6.25 crore shares on offer, according to stock exchange data at 16:45 IST on Friday (13 May 2022). The issue was subscribed 1.63 times

The issue opened for bidding on Wednesday (11 May 2022) and it will close on Friday (13 May 2022). The price band of the IPO is fixed at Rs 462-487 per share. An investor can bid for a minimum of 30 equity shares and in multiples thereof.

The initial public offer (IPO) of Venus Pipes and Tubes received bids for 5.77 crore shares as against 35.51 lakh shares on offer, according to stock exchange data at 16:45 IST on Friday (13 May 2022). The issue was subscribed 16.27 times.

The issue opened for bidding on Wednesday (11 May 2022) and it will close on Friday (13 May 2022). The price band of the IPO is fixed at Rs 310-326 per share. An investor can bid for a minimum of 46 equity shares and in multiples thereof.

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