Sensex drops 581 pts, Nifty holds 17,100; IT shares drag

The benchmark indices ended with modest losses on Thursday, dragged by IT, consumer durables and pharma stocks. On the other hand, banks and auto shares bucked the weak market trend. The Nifty managed to close above 17,100 mark after hitting the day`s low of 16,866.75 in afternoon trade. Trading was volatile due to expiry of January derivatives contracts on the NSE.

The barometer index, the S&P BSE Sensex, dropped 581.21 points or 1% at 57,276.94. The Nifty 50 index fell 167.80 points or 0.97% at 17,110.15.

In the broader market, the S&P BSE Mid-Cap index fell 1.25% while the S&P BSE Small-Cap index lost 0.82%.

The market breadth was negative. On the BSE, 1,480 shares rose and 1,884 shares fell. A total of 91 shares were unchanged.

The Budget session of Parliament is set to commence on 31 January 2022 and will conclude on 8 April 2022. The government will present the Budget for fiscal 2022-23 on 1 February 2022. The Economic Survey is likely to be tabled on 31 January 2022 after the president`s address.

On the political front, developments in the upcoming assembly polls in Uttar Pradesh, Uttarakhand, Goa, Punjab, and Manipur will be closely watched. Polls in all the five states will be held between 10 February 2022 and 7 March 2022 in seven phases. The counting of votes and the result will be declared on 10 March 2022.

COVID-19 Update:

In the last 24 hours, India saw a marginal rise in fresh cases, reporting over 2.86 lakh (2,86,364) on Thursday. With around 3.06 lakh (3,06,357) recoveries, the number of active cases has declined to 22 lakh (22,02,472). The daily positivity rate has increased slightly to 19.59%, while the weekly positivity rate is now 17.75%.

Economy:

The International Monetary Fund (IMF) raised its forecast for growth in India`s gross domestic product (GDP) in FY23 by 50 basis points (bps) to 9%. India`s GDP growth forecast for FY24 was also raised by 50 bps to 7.1%. Explaining the upward revision in an update to its World Economic Outlook report, the IMF said it expects an improvement in India`s credit growth which would boost consumption and investment and "better-than-anticipated performance of the financial sector."

Numbers to Track:

The yield on 10-year benchmark federal paper rose to 6.749% as compared with 6.662% 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 75.08, compared with its close of 74.7850 during the previous trading session.

MCX Gold futures for 4 February 2022 settlement fell 1.12% to Rs 48,303.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, rose 0.46% to 96.835.

In the commodities market, Brent crude for March 2022 settlement rose 16 cents or 0.18% at $88.90 a barrel.

Global Markets:

Most shares in Europe and Asia declined on Thursday as global markets react badly to the latest monetary policy decision from the U.S. Federal Reserve.

The Federal Reserve on Wednesday said it is likely to hike interest rates in March and reaffirmed plans to end its bond purchases that month in what U.S. central bank chief Jerome Powell pledged will be a sustained battle to tame inflation.

"The committee is of a mind to raise the federal funds rate at the March meeting assuming that the conditions are appropriate for doing so," Powell said in a news conference, pinning down a policy statement from the central bank`s Federal Open Market Committee that only said rates would rise "soon."

Buzzing Segment:

The Nifty PSU Bank index rallied 5.07% to 2,907.30. The index has rallied 9.52% in two sessions.

Union Bank of India (up 9.26%), Canara Bank (up 8.65%), Indian Bank (up 7.68%), Bank of India (up 6.02%), Punjab & Sind Bank (up 5.50%), Jammu & Kashmir Bank (up 5.36%), Bank of Baroda (up 5.13%), Punjab National Bank (up 4.44%), Bank of Maharashtra (up 4.21%), Central Bank of India (up 4.08%), Indian Overseas Bank (up 3.21%), UCO Bank (up 3.09%) and State Bank of India (up 2.79%) surged.

Stocks in Spotlight:

Laurus Labs fell 2.29% after the company`s consolidated net profit declined 44% to Rs 154 crore in Q3 FY22 from Rs 273 crore in Q3 FY21. Revenues contracted by 20% YoY to Rs 1,029 crore during the quarter, due to lower demand of ARV APIs and formulations due to transient inventory correction. EBITDA in Q3 FY22 stood at Rs 290 crore, down by 33% from Rs 433 crore in Q3 FY21. EBITDA margin was 28.2% in Q3 FY22 as against 33.6% in Q3 FY21.

United Spirits fell 3.89%. The company reported 26.6% rise in standalone net profit to Rs 291.1 crore on 15.9% increase in net sales to Rs 2,884.7 crore in Q3 FY22 over Q3 FY21. The company said that the growth in sales reflected a strong quarter driven by resilient consumer demand in the off-trade channel, continued premiumisation and recovery of the on-trade channel. Underlying net sales increased 14.3%, excluding the one-off sale of bulk scotch.

Colgate-Palmolive (India) fell 1.71%. The company reported 2% rise in net profit to Rs 252 crore on a 4% increase in sales to Rs 1,271 crore in Q3 FY22 over Q3 FY21. Total expenses during the quarter rose by 4% Y-o-Y to Rs 945 crore, due to higher raw material costs (up 6% Y-o-Y), higher employee expenses (up 16% Y-o-Y) and higher other expenses (up 8% Y-o-Y).

Cipla advanced 2.63%. The pharmaceutical major reported a 2.6% decline in consolidated net profit to Rs 729 crore in Q3 FY22 from Rs 748 crore posted in Q3 FY21. The drug maker`s total revenue from operations grew by 6% year on year to Rs 5,479 crore in Q3 FY22 over Q3 FY21. Consolidated profit before tax grew by 3.2% to Rs 1,054 crore in Q3 FY22 over same period last year. Consolidated EBITDA fell 3% to Rs 1,243 crore in Q3 FY22 from Rs 1,281 crore posted in the same quarter last year. EBITDA margin declined to 22.7% in Q3 FY22 from 24.8% in Q3 FY21.

SRF dropped 4.84%. The company`s consolidated net profit rose 55.68% to Rs 505.54 crore on 55.64% rise in net sales to Rs 3314.14 crore in Q3 December 2021 over Q3 December 2020. On a consolidated basis, profit before tax jumped 65% year-on-year to Rs 730.28 crore in Q3 December 2021. The company`s Earnings before Interest and Tax (EBIT) increased 66% to Rs 796 crore in Q3FY22 when compared with the same period last year. Total expenses jumped 52.22% to Rs 2626.26 crore with cost of materials consumed rising 55.39% to Rs 1739.73 crore during the period under review. Power and fuel expense rose 54.24% to Rs 300.18 during the period under review.

Torrent Pharmaceuticals slumped 14.92%. The company`s consolidated net profit fell 16% to Rs 249 crore on 6% increase in revenue from operations to Rs 2,108 crore in Q3 December 2021 over Q3 December 2020. On a consolidated basis, EBITDA fell 5% year-on-year to Rs 585 crore in Q3 December 2021 over Q3 December 2020. R&D spend rose 9% to Rs 123 crore during the period under review. Profit before tax was flat at Y-o-Y at Rs 357 crore in Q3 FY22.

Macrotech Developers slipped 1.31%. The company`s consolidated net profit jumped 23.6% to Rs 286.38 crore on a 36% jump in net sales to Rs 2,059.44 crore in Q3 FY22 over Q3 FY21. Adjusted EBITDA stood at Rs 698 crore, rising 55% Y-o-Y in Q3 FY22. Adjusted EBITDA margin was at 34% during the quarter.

TeamLease Services soared 7.71%. The company`s consolidated net profit rose 31.05% to Rs 29.97 crore on 38.16% increase in revenue from operations to Rs 1,762.08 crore in Q3 December 2021 over Q3 December 2020.

Canara Bank jumped 8.77%. The public sector bank posted a 115.8% jump in standalone net profit to Rs 1,502 crore in Q3 FY22 from Rs 696 crore posted in Q3 FY21. The bank`s total income stood at Rs 21,312.27 crore in Q3 FY22 as compared to Rs 21,365.39 crore in Q3 FY21. Operating profit before provisions and contingencies rose 10.1% year on year to Rs 5802.52 crore in Q3 FY22. Meanwhile, profit before tax zoomed 108% to Rs 2,202.7 crore in Q3 FY22 over Q3 FY21.

Primary Market:

The initial public offer (IPO) of Adani Wilmar received bids for 4,22,91,730 shares as against 12,25,46,150 shares on offer, according to stock exchange data at 16:48 IST on Thursday, (27 January 2022). The issue was subscribed 35%.

The issue opened for bidding on 27 January 2022 and it will close on 31 January 2022. The price band of the IPO is fixed at Rs 218-230. An investor can bid for a minimum of 65 equity shares and in multiples thereof. The IPO comprises a fresh issue of upto Rs 3,600 crore (including an anchor portions of 4,08,65,217 equity shares).

Powered by Capital Market - Live News