Sensex, Nifty register heavy losses for the 5th day; India VIX up 21%
Published on Jan 24, 2022 16:48
The benchmark indices logged substantial losses on Monday as a result of weak global cues ahead of the Federal Open Market Committee meet. Sectoral indices declined across the board. The Nifty closed tad below 17,150 mark.
The barometer index, the S&P BSE Sensex, tumbled 1,545.67 points or 2.62% to 57,491.51. The Nifty 50 index slumped 468.05 points or 2.66% to 17,149.10.
The Nifty fell over 6% to extend its 5-day fall to trade below its 50 DMA and 200 DMA at 17485.95 and 16603.32 respectively. The NSE`s VIX index, a gauge of the market`s expectation of volatility over the near term, soared 20.84% to 22.83.
The BSE Mid-Cap index declined 3.82% and the BSE Small-Cap index dropped 4.43%.
The market breadth was weak. On the BSE, 511 shares rose and 3,072 shares fell. A total of 123 shares were unchanged.
In last 24 hours, India added 3,06,064 new cases. The country`s daily positivity rate stood at 20.75%. India`s Active caseload currently stands at 22,49,335. Meanwhile, India reported 439 deaths linked to COVID-19.
Numbers to Watch:
The yield on 10-year benchmark federal paper rose to 6.655% as compared with 6.620% at close in the previous trading session.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 74.62, compared with its close of 74.4325 during the previous trading session.
MCX Gold futures for 4 February 2022 settlement rose 0.58% to Rs 48,530.
The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, rose 0.21% to 95.84.
In the commodities market, Brent crude for March 2022 settlement fell 11 cents at $87.78 a barrel. The contract fell 49 cents, or 0.55% to settle at $87.89 a barrel in the previous trading session.
European stocks declined across the board on Monday as investors braced themselves for the next meeting of the U.S. Federal Reserve this coming week, and watched for developments in Ukraine as tensions with Russia grow.
The Federal Open Market Committee is due to meet on Tuesday and Wednesday to decide on the next steps for U.S. monetary policy. Meanwhile, the Wall Street`s main indexes ended sharply lower on Friday as Netflix shares plunged after a weak earnings report.
Asian stocks traded mixed as investors looked ahead to the U.S. Federal Reserve`s monetary policy meeting this week.
China has delivered another rate cut with the People`s Bank of China cutting the rate on 14-day reverse repo by 10 bps. China`s recent cut of two key policy interest rates opened the door to more monetary easing actions ahead. This is despite the sentiment that the Federal Reserve will probably hike rates from March.
The Nifty FMCG index declined 2.37% to 35,941.35. The index rose 0.36% in the past trading session.
United Spirits (down 5.32%), Proctor & Gamble Hygiene and Healthcare (down 5.28%), Radico Khaitan (down 5.18%), Tata Consumer Products (TCPL) (down 4.82%) and Godrej Consumer Products (down 3.52%) were the top losers in the FMCG segment.
Stocks in Spotlight:
Reliance Industries (RIL) dropped 4.06%. On a consolidated basis, India`s largest conglomerate RIL reported a 37.9% jump in net profit to Rs 20,539 crore on a 57% rise in net sales to Rs 185,027 crore in Q3 FY22 over Q3 FY21. Consolidated profit before tax stood at Rs 25,227 crore in Q3 FY22, rising 68.4% from Rs 14,982 crore posted in Q3 FY21. EBITDA for the quarter was at Rs 33,886 crore ($ 4.6 billion), higher by 29.9% year on year. EBITDA growth was driven by robust operating performance across businesses.
Finance cost decreased by 11.9% to Rs 3,812 crore in Q3 FY22 as against Rs 4,326 crore posted in the corresponding quarter of the previous year. Lower finance costs reflected large paydown of debt, other liabilities and stabilization of exchange rates. Outstanding debt as on 31 December 2021 was Rs 244,708 crore in Q3 FY22. Cash and cash equivalents as on 31 December 2021 were at Rs 241,846 crore. The company posted an exceptional item (gain) of Rs 2,872 crore on account of divestment of shale gas assets, partially offset by provisions for liabilities pertaining to GAPCO amounting to Rs 36 crore.
ICICI Bank fell 0.80%. The bank advanced 1.04% to Rs 813 after the bank`s standalone net profit grew by 25% to Rs 6,194 crore in Q3 FY22 from Rs 4,940 crore in Q3 FY21. Total income during the quarter rose by 11% YoY to Rs 27,070 crore. The profit before tax increased by 34% to Rs 8,141 crore in Q3 FY22 from Rs 6,078 crore in Q3 FY21. The core operating profit (profit before provisions and tax, excluding treasury income) increased by 25% to Rs 10,060 crore in the quarter ended 31 December 2021 from Rs 8,054 crore in the quarter ended 31 December 2020.
Net interest income (NII) in Q3 FY22 stood at Rs 12,236 crore, up by 23% from Rs 9,912 crore in Q3 FY21. The net interest margin was 3.96% in the quarter ended 31 December 2021 as against 3.67% in the quarter ended 31 December 2020 and 4% in the quarter ended 30 September 2021. Provisions (excluding provision for tax) declined by 27% to Rs 2,007 crore in Q3 FY22 from Rs 2,742 crore in Q3 FY21. Provision coverage ratio was 79.9% at 31 December 2021. The bank continues to hold COVID-19 provisions of Rs 6,425 crore as of 31 December 2021.
Yes Bank declined 1.97%. The private sector bank`s net profit jumped 76.8% to Rs 266.43 crore in Q3 FY22 from Rs 150.71 crore posted in Q3 FY21. Meanwhile, the bank`s total income fell 12.1% to Rs 5,632 crore in Q3 FY22 over Q3 FY21. Profit before tax surged to Rs 356 crore in Q3 FY22 from Rs 86.7 crore reported in Q3 FY21. Meanwhile, the bank`s operating profit before provisions & contingencies fell 66.4% to Rs 730.68 crore in Q3 FY22 over Q3 FY21.
Net interest income (interest earned less interest expended) declined 31.1% to Rs 1,764 crore in Q3 FY22 from RS 2,560 crore posted in Q3 FY21. Net interest margin declined to 2.4% in Q3 FY22 from 3.4% in Q3 FY21. The bank`s provisions and contingencies (excluding tax provisions) sharply declined by 82% to Rs 375 crore in Q3 FY22 as compared to Rs 2,089 crore posted in the same quarter last year. Meanwhile, the bank`s provision coverage ratio slipped to 79.3% in Q3 FY22 from 81.5% posted in Q3 FY21.
Bandhan Bank rallied 4.19%. The microfinance bank reported a 35.8% rise in standalone net profit to Rs 858.97 crore on a 6.5% rise in total income to Rs 4,120.95 crore in Q3 FY22 over Q3 FY21. Profit before tax rose 35.4% to Rs 1,144 crore in Q3 FY22 over Q3 FY21. Operating profit before provisions and contingencies rose 1.4% to Rs 1950.14 crore in Q3 FY22 as compared to Rs 1,923.18 crore in Q3 FY21. Net Interest Income (NII) for the quarter grew by 2.6% to Rs 2,124.7 crore as against Rs 2,071.7 crore in the corresponding quarter of the previous year. Net interest margin (annualised) for the quarter ended 31 December 2021 stood at 7.8% as against 7.6% in Q2 FY22.
Gland Pharma tumbled 7.42%. The company`s consolidated net profit increased by 34% to Rs 273 crore in Q3 FY22 from Rs 204.1 crore in Q3 FY21. Revenue from operations during the third quarter of financial year 2022 grew by 24% to Rs 1063.3 crore as compared to corresponding quarter of the previous year. The growth in revenue was on account of launch of new products and volume growth in existing products, the company said. The company`s key market, USA, has seen a Y-o-Y revenue growth rate of 23% for the quarter, including the India sales for USA market. Its core markets, US, Canada, Europe, and Australia accounted for 63% of the revenue during Q3 FY22.
Vodafone Idea slumped 7.98%. The debt-ridden telecom company reported a consolidated net loss of Rs 7,230.9 crore in Q3 FY22 as against a net loss of Rs 4,532.1 crore in Q3 FY21. The telecom major had recorded a loss of Rs 7,132.3 crore in Q2 FY22. Revenue for the quarter was Rs. 9,720 crore, a Q-o-Q improvement of 3.3%, aided by several tariff interventions including the recent tariff hikes taken by all operators in November 2021. Cash & cash equivalents were Rs 1500 crore and net debt stood at Rs 1,97,480 crore. The subscriber base declined to 247.2 million in Q3 FY22 from 253 million in Q2 FY22, because of these tariff interventions.
CSB Bank lost 0.41%. The bank`s standalone net profit surged 179.5% to Rs 148.25 crore on a 5.6% decline in total income to Rs 579.81 crore in Q3 FY22 over Q3 FY21. In Q3 FY22, the NII stood at Rs 303.34 crore as against Rs 251.19 crore in Q3 FY21 and Rs 278.38 crore for the previous quarter, rising 21% Y-o-Y (year-on-year) and 9% Q-o-Q (quarter-on-quarter) respectively. The increase in NII was powered by the spread and volume effects combined with impressive interest income recoveries on Gold loan NPAs.
The operating profit Q3 FY22 stood at Rs 147.55 crore as against Rs 197.19 crore for Q3 FY21 and Rs 149.38 crore for Q2 FY22, mainly due to decrease in treasury profit and PSLC commission payout. On the asset quality front, the gross non-performing assets were at Rs 388.95 crore as of 31 December 2021 as against Rs 586.83 crore reported on 30 September 2021 and Rs 686.39 crore as of 30 June 2021. The gross NPA ratio was 2.62% as of 31 December 2021 as compared with 4.11% as on 30 September 2021 and 4.88% as of 30 June 2021. The net NPA ratio was 1.36% as of 31 December 2021 as against 2.63% reported on 30 September 2021 and 3.21% as of 30 June 2021.
Supreme Industries dropped 5.08%. The company`s consolidated net profit declined 21% to Rs 246 crore in Q3 FY22 from Rs 312 crore in Q3 FY21. Total consolidated income rose by 5% Y-o-Y to Rs 1,948 crore during the quarter. The overall turnover of value added products decreased to Rs. 665 crores during the current 3rd quarter as compared to Rs. 758 crores in the corresponding period of previous year resulting in a de-growth of about 12%, the company. EBIDTA fell by 19% to Rs 369 crore in Q3 FY22 from Rs 454 crore in Q3 FY21. EBIDTA margin was 19% in Q3 FY22 as against 25% in Q3 FY21. The company has cash surplus funds of Rs 148 crore as on 31 December 2021 as against cash surplus funds of Rs 331 crore as on 30 September 2021.
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