Sunday, July 31, 2016
Saturday, July 30, 2016
THE WEEK AHEAD
Progress on GST bill to dictate trend
Next batch of Q1 June 2016 corporate results, progress of monsoon rains, the outcome of the monthly surveys on India's manufacturing and services sectors, trend in global markets, investment by foreign portfolio investors (FPIs) and domestic institutional investors (DIIs), the movement of rupee against the dollar and crude oil price movement will dictate market trend in the near term.
Meanwhile, investors are awaiting the progress on the Goods and Services Tax (GST) constitutional amendment bill in parliament. According to reports, the government on Friday, 29 July 2016, listed the much-awaited GST bill for consideration and passage in Rajya Sabha's agenda for the next week. Minister of state for parliamentary affairs Mukhtar Abbas Naqvi, while making a statement regarding government business for the week starting 1 August in the Upper House, reportedly said that the GST constitutional amendment bill will be taken up for consideration and passage in the Rajya Sabha. The government is keen to get the GST Bill approved during the Monsoon Session of Parliament ending on 12 August 2016.
The GST bill, which has been approved by the Lok Sabha, is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax.
Select companies are scheduled to announce their Q1 June 2016 results in the first week of August 2016. HCL Infosystems will announce its April-June 2016 results on Saturday, 30 July 2016. Hotel LeelaVenture, InterGlobe Aviation, Piramal Enterprises, Tata Communications and Tech Mahindra will announce their April-June 2016 results on Monday, 1 August 2016. Indian Bank and Voltas will announce their April-June 2016 results on Tuesday, 2 August 2016. Bata India, Berger Paints India, Cadila Healthcare and HCL Technologies will announce their April-June 2016 results on Wednesday, 3 August 2016. Tata Power Company will announce its April-June 2016 results on Thursday, 4 August 2016. Bharat Electronics, Bharat Forge, GlaxoSmithkline Consumer Healthcare and Pfizer will announce their April-June 2016 results on Friday, 5 August 2016.
The performance of the monsoon rains is being keenly watched. In its monsoon update issued on Thursday, 28 July 2016, the India Meteorological Department (IMD) said that for the country as a whole, cumulative rainfall during this year's monsoon as on 27 July 2016, was at 0% above the Long Period Average (LPA).
Stocks of auto companies will be in focus as companies start unveiling monthly sales volume data for June 2016 from Monday, 1 August 2016.
Stocks of public sector oil marketing companies (PSU OMCs) will be in focus as a fuel price review is due at the end of the month. PSU OMCs undertake fuel price review twice during the month based on the trend in international oil market. The first price review takes place during the middle of the month and the second on the last day of the month. Aviation stocks will be in focus as a monthly review of jet fuel prices is due at the end of the month. PSU OMCs review jet fuel prices on the last day every month based on the average imported crude oil price for the month. Jet fuel prices are directly linked to crude oil price.
Among domestic macro economic data, Markit Economics will announce the India Manufacturing PMI for July 2016 on Monday, 1 August 2016. The Nikkei India Services PMI will be declared on Wednesday, 3 August 2016.
On the global front, China will unveil Manufacturing Purchasing Managers Index (PMI) data and Caixin Manufacturing PMI data for July 2016 on Sunday, 31 July 2016.
Germany Manufacturing PMI data and UK Manufacturing PMI data for July 2016 will be unveiled on Monday, 1 August 2016. US Institute of Supply Management (ISM) Manufacturing PMI report for July 2016 will also be unveiled on Monday, 1 August 2016.
UK Construction PMI for July 2016 will be unveiled on Tuesday, 2 August 2016.
UK Services PMI data for July 2016 will be unveiled on Wednesday, 3 August 2016. US ADP Nonfarm Employment Change for July 2016 will be unveiled on Wednesday, 3 August 2016. US ISM Non-Manufacturing PMI report for July 2016 will be unveiled on Wednesday, 3 August 2016.
Bank of England (BOE) monetary policy committee members vote on where to set the rate on Thursday, 4 August 2016.
US Nonfarm Payrolls data for July 2016 will be unveiled on Friday, 5 August 2016.
US Unemployment Rate data for July 2016 will be unveiled on Friday, 5 August 2016
Meanwhile, investors are awaiting the progress on the Goods and Services Tax (GST) constitutional amendment bill in parliament. According to reports, the government on Friday, 29 July 2016, listed the much-awaited GST bill for consideration and passage in Rajya Sabha's agenda for the next week. Minister of state for parliamentary affairs Mukhtar Abbas Naqvi, while making a statement regarding government business for the week starting 1 August in the Upper House, reportedly said that the GST constitutional amendment bill will be taken up for consideration and passage in the Rajya Sabha. The government is keen to get the GST Bill approved during the Monsoon Session of Parliament ending on 12 August 2016.
The GST bill, which has been approved by the Lok Sabha, is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax.
Select companies are scheduled to announce their Q1 June 2016 results in the first week of August 2016. HCL Infosystems will announce its April-June 2016 results on Saturday, 30 July 2016. Hotel LeelaVenture, InterGlobe Aviation, Piramal Enterprises, Tata Communications and Tech Mahindra will announce their April-June 2016 results on Monday, 1 August 2016. Indian Bank and Voltas will announce their April-June 2016 results on Tuesday, 2 August 2016. Bata India, Berger Paints India, Cadila Healthcare and HCL Technologies will announce their April-June 2016 results on Wednesday, 3 August 2016. Tata Power Company will announce its April-June 2016 results on Thursday, 4 August 2016. Bharat Electronics, Bharat Forge, GlaxoSmithkline Consumer Healthcare and Pfizer will announce their April-June 2016 results on Friday, 5 August 2016.
The performance of the monsoon rains is being keenly watched. In its monsoon update issued on Thursday, 28 July 2016, the India Meteorological Department (IMD) said that for the country as a whole, cumulative rainfall during this year's monsoon as on 27 July 2016, was at 0% above the Long Period Average (LPA).
Stocks of auto companies will be in focus as companies start unveiling monthly sales volume data for June 2016 from Monday, 1 August 2016.
Stocks of public sector oil marketing companies (PSU OMCs) will be in focus as a fuel price review is due at the end of the month. PSU OMCs undertake fuel price review twice during the month based on the trend in international oil market. The first price review takes place during the middle of the month and the second on the last day of the month. Aviation stocks will be in focus as a monthly review of jet fuel prices is due at the end of the month. PSU OMCs review jet fuel prices on the last day every month based on the average imported crude oil price for the month. Jet fuel prices are directly linked to crude oil price.
Among domestic macro economic data, Markit Economics will announce the India Manufacturing PMI for July 2016 on Monday, 1 August 2016. The Nikkei India Services PMI will be declared on Wednesday, 3 August 2016.
On the global front, China will unveil Manufacturing Purchasing Managers Index (PMI) data and Caixin Manufacturing PMI data for July 2016 on Sunday, 31 July 2016.
Germany Manufacturing PMI data and UK Manufacturing PMI data for July 2016 will be unveiled on Monday, 1 August 2016. US Institute of Supply Management (ISM) Manufacturing PMI report for July 2016 will also be unveiled on Monday, 1 August 2016.
UK Construction PMI for July 2016 will be unveiled on Tuesday, 2 August 2016.
UK Services PMI data for July 2016 will be unveiled on Wednesday, 3 August 2016. US ADP Nonfarm Employment Change for July 2016 will be unveiled on Wednesday, 3 August 2016. US ISM Non-Manufacturing PMI report for July 2016 will be unveiled on Wednesday, 3 August 2016.
Bank of England (BOE) monetary policy committee members vote on where to set the rate on Thursday, 4 August 2016.
US Nonfarm Payrolls data for July 2016 will be unveiled on Friday, 5 August 2016.
US Unemployment Rate data for July 2016 will be unveiled on Friday, 5 August 2016
THE WEEK THAT WAS
Market gains on GST-fuelled optimism
The market edged higher last week on hopes that the Goods & Services Tax (GST) bill inched closer to becoming a reality after media reports suggested that the Union Cabinet approved amendments to the constitutional amendment bill, incorporating suggestions by some of the states and opposition parties. Market sentiment was also boosted after the US Federal Reserve has opted to keep interest rates at ultra-low level after the conclusion of a two-day monetary policy meeting. The ultra-loose monetary policy in the US has encouraged heavy investment in higher-yielding emerging markets. The barometer index, the S&P BSE Sensex, moved past the psychologically important 28,000 mark.
The Sensex rose 248.62 points or 0.89% to settle at 28,051.86, in the week ended 29 July 2016. The Nifty 50 index gained 97.30 points or 1.14% to settle at 8,638.50. The BSE Mid-Cap index gained 3.13%. The BSE Small-Cap index rose 1.67%. Both these indices outperformed the Sensex.
According to reports, the government on Friday, 29 July 2016, listed the much-awaited GST bill for consideration and passage in Rajya Sabha's agenda for the next week. Minister of state for parliamentary affairs Mukhtar Abbas Naqvi, while making a statement regarding government business for the week starting 1 August in the Upper House, reportedly said that the GST constitutional amendment bill will be taken up for consideration and passage in the Rajya Sabha. The government is keen to get the GST Bill approved during the Monsoon Session of Parliament ending on 12 August 2016.
The GST bill, which has been approved by the Lok Sabha, is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax. The month-long monsoon session of the parliament will conclude on 12 August 2016.
In overseas stock markets, the US Federal Open Market Committee (FOMC) decided not to raise interest rates, maintaining the ultra-low level they have been at since December 2015. The US central bank opted to keep rates between 0.25% and 0.5% after the conclusion of two-day monetary policy on Wednesday, 27 July 2016. The Fed said near-term risks to the economic outlook have diminished but inflation remained below the bank's target.
Meanwhile, the Bank of Japan (BOJ) kept interest rates and government bond buying unchanged after the conclusion of a two-day monetary policy meeting. The Japan's central bank said it would buy 6 trillion yen worth of exchange-traded funds annually, up from 3.3 trillion yen previously, in an attempt to stoke inflation and growth by pumping money into the economy. BOJ said it would leave its asset-purchase target at 80 trillion yen a year.
Back home, trading for the week started on a strong note. Banking sector stocks, shares of state-run oil companies and index heavyweight HDFC led the upmove on the domestic bourses on Monday, 25 July 2016, as investors awaited progress on the passage of the Goods and Services Tax (GST) constitutional amendment bill in parliament. The Sensex rose 292.10 points or 1.05% to settle at 28,095.34, its highest closing level since 10 August 2015.
Disappointing first quarter results from passenger car major Maruti Suzuki India (MSIL) and weak results from Dr Reddy's Laboratories (DRL) pulled the market lower towards the fag end of the trading session on Tuesday, 26 July 2016. The Sensex fell 118.82 points or 0.42% to settle at 27,976.52, its lowest closing level since 22 July 2016.
Amid hopes for the passage of the GST constitution amendment bill during the ongoing monsoon session of parliament, the two benchmark indices eked out small gains on Wednesday, 27 July 2016. The Sensex rose 47.81 points or 0.17% to settle at 28,024.33, its highest closing level since 25 July 2016.
Key benchmark indices registered decent gains on Thursday, 28 July 2016 amid hopes that the GST bill inched closer to becoming a reality after media reports suggested that the Union Cabinet approved amendments to the constitutional amendment bill, incorporating suggestions by some of the states and opposition parties. The Sensex rose 184.29 points or 0.66% to settle at 28,208.62, its highest closing level since 7 August 2015.
Losses in telecom stocks and index heavyweights HDFC and Reliance Industries led losses for key benchmark indices on the last trading session of the week on Friday, 29 July 2016. The barometer index, the S&P BSE Sensex lost 156.76 points or 0.56% to settle at 28,051.86. Weakness in Asian stocks weighed on sentiment on the domestic bourses.
Among the 30-shares in the Sensex pack, 19 rose and the remaining shares fell.
Car major Maruti Suzuki India was the biggest gainer in the Sensex pack last week. The stock rose 7.74% to Rs 4755.20. The company's net profit rose 23.01% to Rs 1486.20 crore on 13.45% rise in total income to Rs 15410.60 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours on Tuesday, 26 July 2016.
Maruti Suzuki India said that higher profit in Q1 June 2016 was helped by a higher turnover, material cost reduction, higher non-operating income and lower depreciation. Adverse foreign exchange movement reduced profits to some extent.
The company said that the unfortunate incident of fire at a key vendor of the company resulted in lower sales in June 2016. The company hopes to recover the lost sales during the course of the year.
In a separate announcement on Wednesday, 27 July 2016, Maruti Suzuki India announced that it will start sales of its first Light Commercial Vehicle (LCV) "Super Carry" towards the end of August.
Two-wheelers major Hero MotoCorp fell 1.65% to Rs 3,206.45 after the company announced that the members of the company's promoter family decided to realign their businesses to achieve future growth and expansion. The announcement was on Thursday, 28 July 2016.
Hero MotoCorp (HMCL) announced that keeping with the core values of the Hero Group as established by the late Dr. Brijmohan Lall Munjal, the company's promoter members of the BML Munjal family have decided to realign their businesses to achieve future growth and expansion. With the blessings of Santosh Munjal, the matriarch of the Munjal family, Sunil Kant Munjal, Joint Managing Director, HMCL and Chairman, Hero Corporate Service, intends to focus his time and energy on his independent and core businesses, and to pursue new business interests, HMCL said. He has, therefore, expressed his desire to step down from the Board of Directors of HMCL once his tenure as the Joint Managing Director of the company comes to an end on 16 August 2016, HMCL said. This realignment will not impact the overall promoter shareholding, strategic direction or operational management of the company, HMCL said. On this occasion, Pawan Munjal, Chairman, Managing Director & Chief Executive Officer of HMCL, and the senior leadership team at HMCL reiterated their commitment to continue to build the company into a truly world class enterprise in all respects.
As per the shareholding pattern, promoters hold 34.64% stake in the company as on 30 June 2016.
Asian Paints jumped after the company reported strong Q1 results. The stock rose 6.64% at Rs 1,114.70. The company's consolidated net profit after minority interest rose 17.9% to Rs 535 crore on 10.2% increase interest from operations to Rs 4082.10 crore in Q1 June 2016 over Q1 June 2015. Profit before depreciation, interest, and taxes (PBDIT) rose 20.9% to Rs 820.30 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours on Wednesday, 27 July 2016.
Sun Pharmaceutical Industries (Sun Pharma) rose 5.33% to Rs 829.75. The company said it signed an agreement with RPG Life Sciences on 27 July 2016 to divest seven prescription brands in India, owned by Sun Pharma and its subsidiary, for a consideration of Rs 41 crore. The seven divested brands include brands used for treatment of respiratory-track infections, urological disorders, cardiovascular diseases and brands in health supplements segment. This divestment is subject to receipt of Competition Commission of India's (CCI) approval. The announcement was made on Wednesday, 27 July 2016.
Separately, Sun Pharma before market hours on Thursday, 28 July 2016, announced a licencing agreement with Almirall on the development and commercialization of Tildrakizumab for psoriasis in Europe. Tildrakizumab is an investigational IL-23p19 inhibitor currently being evaluated in patients with moderate-to-severe plaque psoriasis. Under the terms of the licence agreement, Almirall will pay Sun Pharma an initial upfront payment of $50 million. Phase-3 studies of Tildrakizumab have recently been completed. Sun Pharma will be eligible to receive development and regulatory milestone payments and, additionally, sales milestone payments and royalties on net sales, the terms of which are confidential. Almirall will be able to lead European studies, and participate in larger global clinical studies for psoriasis indication subject to the terms of the Sun Pharma-Merck agreements, as well as certain cost sharing agreements. Sun Pharma will continue to lead development of Tildrakizumab for other indications, where Almirall will have right of first negotiation for certain indications in Europe. Additionally, the license agreement has a provision for possible co-promotion agreement at some point in the future, subject to certain conditions, Sun Pharma said in a statement.
IT pivotals rose. TCS (up 4.36%), Wipro (up 1.59%) and Infosys (up 0.12%), edged higher.
Most banking pivotals edged higher. State Bank of India (up 2.51%), Axis Bank (up 1.58%) and HDFC Bank (up 1.23%), edged higher.
Private sector lender ICICI Bank fell 0.27% to Rs 262.85.
Housing finance major HDFC rose 1.38% to Rs 1,374.35. The company's net profit rose 37.45% to Rs 1870.73 crore on 19.4% growth in total income to Rs 8393.33 crore in Q1 June 2016 over Q1 June 2015. Housing Development Finance Corporation (HDFC)'s loan book increased to Rs 2.65 lakh crore as on 30 June 2016, from Rs 2.31 lakh crore as on 30 June 2015. This is after considering the loans sold during the preceding 12 months amounting to Rs 14011 crore. During Q1 June 2016, HDFC sold loans amounting to Rs 5108 crore of which Rs 3296 crore was sold to HDFC Bank and the balance to other banks.
There was a pre-tax gain of Rs 921.61 crore in Q1 June 2016 from sale of 12.33 crore shares of HDFC ERGO General Insurance Company to Ergo International AG. HDFC made an additional one time provision of Rs 275 crore in Q1 June 2016 towards standard assets and other contingencies.
On consolidated basis, HDFC's net profit rose 26.88% to Rs 2796.92 crore on 18.67% growth in total income to Rs 13531.48 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours on Wednesday, 27 July 2016.
L&T fell 1.01% at Rs 1,558. The company's consolidated net profit rose 46% to Rs 610 crore on 9.1% growth in gross revenue to Rs 21874 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours on Friday, 29 July 2016.
L&T's consolidated order book increased by 8% on year-on-year (YoY) basis to Rs 2.57 lakh crore as on 30 June 2016. International order book constituted 29% of the total order book.
On future business outlook, L&T said that on the international front, the company will continue to target select prospects in the space of core infrastructure and oil & gas sector in the Middle East, Africa and other neighboring countries. The company said it has recently finalised its strategic plan for five years with a focus on profitable growth. L&T said it remains well placed to benefit from emerging opportunities with its execution capabilities and leadership position in various sectors.
Bharti Airtel fell 1.50% to Rs 362.05 after consolidated net profit fell 30.8% to Rs 1462 crore on 7.9% increase in total revenues to Rs 25546 crore in Q1 June 2016 over Q1 June 2015. The company's consolidated revenues grew 8.4% to Rs 25546 crore in Q1 June 2016 over Q1 June 2015 on an underlying basis, adjusted for Africa divested operating unit and tower assets sale.
Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 16.4% to Rs 9591 crore in Q1 June 2016 over Q1 June 2015. The EBITDA margin edged up to 37.5% in Q1 June 2016 from 34.8% in Q1 June 2015.
The company has adopted Indian Accounting Standards (Ind-AS) for its consolidated results effective 1 April 2016 with periods reinstated for like to like comparison.
Consolidated mobile data revenues grew by 34.1% to Rs 4640 crore in Q1 June 2016 over Q1 June 2015.
India revenues grew by 10.3% to Rs 19155 crore in Q1 June 2016 over Q1 June 2015. This was led by healthy growth of 9.1% in Mobile, 11.0% in Homes, 22.2% in Digital TV and 10.4% in Airtel Business on year-on-year (Y-o-Y) basis. The result was announced on Wednesday 27 July 2016.
Dr Reddy's Laboratories slumped 18.53% to Rs 2,937.25. It was the biggest Sensex loser last week. The selling in the counter was triggered by a slew of brokerages cut their ratings on the stock following weaker-than-expected Q1 earnings. The company's consolidated net profit fell 77.2% to Rs 146.20 crore on 14.1% decline in total income to Rs 3289.50 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours on Tuesday, 26 July 2016.
At the time of announcing Q1 June 2016 results, DRL said that its top and bottom lines were impacted by a decline in volume growth, particularly in the US market and the loss of business in Venezuela. The company also faced a number of challenges in Q1 June 2016 including price erosion and delayed launches as a result of the warning letter, which significantly impacted its earnings.
In a conference call held after market hours on Tuesday, 26 July 2016, DRL's executives reportedly indicated a tough Q2 September 2016, as price and volume erosion of some key products is expected to continue in the absence of any significant new generic approvals. Also there are concerns that competitive pressures in the US, may linger for the balance of the year, reports indicated. The company is losing a key contract supply account of McNeil Consumer Healthcare from its Shreveport facility, Louisiana, which is set to have an impact of $25 million on net profits of the company in coming quarters, reports said.
The Sensex rose 248.62 points or 0.89% to settle at 28,051.86, in the week ended 29 July 2016. The Nifty 50 index gained 97.30 points or 1.14% to settle at 8,638.50. The BSE Mid-Cap index gained 3.13%. The BSE Small-Cap index rose 1.67%. Both these indices outperformed the Sensex.
According to reports, the government on Friday, 29 July 2016, listed the much-awaited GST bill for consideration and passage in Rajya Sabha's agenda for the next week. Minister of state for parliamentary affairs Mukhtar Abbas Naqvi, while making a statement regarding government business for the week starting 1 August in the Upper House, reportedly said that the GST constitutional amendment bill will be taken up for consideration and passage in the Rajya Sabha. The government is keen to get the GST Bill approved during the Monsoon Session of Parliament ending on 12 August 2016.
The GST bill, which has been approved by the Lok Sabha, is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax. The month-long monsoon session of the parliament will conclude on 12 August 2016.
In overseas stock markets, the US Federal Open Market Committee (FOMC) decided not to raise interest rates, maintaining the ultra-low level they have been at since December 2015. The US central bank opted to keep rates between 0.25% and 0.5% after the conclusion of two-day monetary policy on Wednesday, 27 July 2016. The Fed said near-term risks to the economic outlook have diminished but inflation remained below the bank's target.
Meanwhile, the Bank of Japan (BOJ) kept interest rates and government bond buying unchanged after the conclusion of a two-day monetary policy meeting. The Japan's central bank said it would buy 6 trillion yen worth of exchange-traded funds annually, up from 3.3 trillion yen previously, in an attempt to stoke inflation and growth by pumping money into the economy. BOJ said it would leave its asset-purchase target at 80 trillion yen a year.
Back home, trading for the week started on a strong note. Banking sector stocks, shares of state-run oil companies and index heavyweight HDFC led the upmove on the domestic bourses on Monday, 25 July 2016, as investors awaited progress on the passage of the Goods and Services Tax (GST) constitutional amendment bill in parliament. The Sensex rose 292.10 points or 1.05% to settle at 28,095.34, its highest closing level since 10 August 2015.
Disappointing first quarter results from passenger car major Maruti Suzuki India (MSIL) and weak results from Dr Reddy's Laboratories (DRL) pulled the market lower towards the fag end of the trading session on Tuesday, 26 July 2016. The Sensex fell 118.82 points or 0.42% to settle at 27,976.52, its lowest closing level since 22 July 2016.
Amid hopes for the passage of the GST constitution amendment bill during the ongoing monsoon session of parliament, the two benchmark indices eked out small gains on Wednesday, 27 July 2016. The Sensex rose 47.81 points or 0.17% to settle at 28,024.33, its highest closing level since 25 July 2016.
Key benchmark indices registered decent gains on Thursday, 28 July 2016 amid hopes that the GST bill inched closer to becoming a reality after media reports suggested that the Union Cabinet approved amendments to the constitutional amendment bill, incorporating suggestions by some of the states and opposition parties. The Sensex rose 184.29 points or 0.66% to settle at 28,208.62, its highest closing level since 7 August 2015.
Losses in telecom stocks and index heavyweights HDFC and Reliance Industries led losses for key benchmark indices on the last trading session of the week on Friday, 29 July 2016. The barometer index, the S&P BSE Sensex lost 156.76 points or 0.56% to settle at 28,051.86. Weakness in Asian stocks weighed on sentiment on the domestic bourses.
Among the 30-shares in the Sensex pack, 19 rose and the remaining shares fell.
Car major Maruti Suzuki India was the biggest gainer in the Sensex pack last week. The stock rose 7.74% to Rs 4755.20. The company's net profit rose 23.01% to Rs 1486.20 crore on 13.45% rise in total income to Rs 15410.60 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours on Tuesday, 26 July 2016.
Maruti Suzuki India said that higher profit in Q1 June 2016 was helped by a higher turnover, material cost reduction, higher non-operating income and lower depreciation. Adverse foreign exchange movement reduced profits to some extent.
The company said that the unfortunate incident of fire at a key vendor of the company resulted in lower sales in June 2016. The company hopes to recover the lost sales during the course of the year.
In a separate announcement on Wednesday, 27 July 2016, Maruti Suzuki India announced that it will start sales of its first Light Commercial Vehicle (LCV) "Super Carry" towards the end of August.
Two-wheelers major Hero MotoCorp fell 1.65% to Rs 3,206.45 after the company announced that the members of the company's promoter family decided to realign their businesses to achieve future growth and expansion. The announcement was on Thursday, 28 July 2016.
Hero MotoCorp (HMCL) announced that keeping with the core values of the Hero Group as established by the late Dr. Brijmohan Lall Munjal, the company's promoter members of the BML Munjal family have decided to realign their businesses to achieve future growth and expansion. With the blessings of Santosh Munjal, the matriarch of the Munjal family, Sunil Kant Munjal, Joint Managing Director, HMCL and Chairman, Hero Corporate Service, intends to focus his time and energy on his independent and core businesses, and to pursue new business interests, HMCL said. He has, therefore, expressed his desire to step down from the Board of Directors of HMCL once his tenure as the Joint Managing Director of the company comes to an end on 16 August 2016, HMCL said. This realignment will not impact the overall promoter shareholding, strategic direction or operational management of the company, HMCL said. On this occasion, Pawan Munjal, Chairman, Managing Director & Chief Executive Officer of HMCL, and the senior leadership team at HMCL reiterated their commitment to continue to build the company into a truly world class enterprise in all respects.
As per the shareholding pattern, promoters hold 34.64% stake in the company as on 30 June 2016.
Asian Paints jumped after the company reported strong Q1 results. The stock rose 6.64% at Rs 1,114.70. The company's consolidated net profit after minority interest rose 17.9% to Rs 535 crore on 10.2% increase interest from operations to Rs 4082.10 crore in Q1 June 2016 over Q1 June 2015. Profit before depreciation, interest, and taxes (PBDIT) rose 20.9% to Rs 820.30 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours on Wednesday, 27 July 2016.
Sun Pharmaceutical Industries (Sun Pharma) rose 5.33% to Rs 829.75. The company said it signed an agreement with RPG Life Sciences on 27 July 2016 to divest seven prescription brands in India, owned by Sun Pharma and its subsidiary, for a consideration of Rs 41 crore. The seven divested brands include brands used for treatment of respiratory-track infections, urological disorders, cardiovascular diseases and brands in health supplements segment. This divestment is subject to receipt of Competition Commission of India's (CCI) approval. The announcement was made on Wednesday, 27 July 2016.
Separately, Sun Pharma before market hours on Thursday, 28 July 2016, announced a licencing agreement with Almirall on the development and commercialization of Tildrakizumab for psoriasis in Europe. Tildrakizumab is an investigational IL-23p19 inhibitor currently being evaluated in patients with moderate-to-severe plaque psoriasis. Under the terms of the licence agreement, Almirall will pay Sun Pharma an initial upfront payment of $50 million. Phase-3 studies of Tildrakizumab have recently been completed. Sun Pharma will be eligible to receive development and regulatory milestone payments and, additionally, sales milestone payments and royalties on net sales, the terms of which are confidential. Almirall will be able to lead European studies, and participate in larger global clinical studies for psoriasis indication subject to the terms of the Sun Pharma-Merck agreements, as well as certain cost sharing agreements. Sun Pharma will continue to lead development of Tildrakizumab for other indications, where Almirall will have right of first negotiation for certain indications in Europe. Additionally, the license agreement has a provision for possible co-promotion agreement at some point in the future, subject to certain conditions, Sun Pharma said in a statement.
IT pivotals rose. TCS (up 4.36%), Wipro (up 1.59%) and Infosys (up 0.12%), edged higher.
Most banking pivotals edged higher. State Bank of India (up 2.51%), Axis Bank (up 1.58%) and HDFC Bank (up 1.23%), edged higher.
Private sector lender ICICI Bank fell 0.27% to Rs 262.85.
Housing finance major HDFC rose 1.38% to Rs 1,374.35. The company's net profit rose 37.45% to Rs 1870.73 crore on 19.4% growth in total income to Rs 8393.33 crore in Q1 June 2016 over Q1 June 2015. Housing Development Finance Corporation (HDFC)'s loan book increased to Rs 2.65 lakh crore as on 30 June 2016, from Rs 2.31 lakh crore as on 30 June 2015. This is after considering the loans sold during the preceding 12 months amounting to Rs 14011 crore. During Q1 June 2016, HDFC sold loans amounting to Rs 5108 crore of which Rs 3296 crore was sold to HDFC Bank and the balance to other banks.
There was a pre-tax gain of Rs 921.61 crore in Q1 June 2016 from sale of 12.33 crore shares of HDFC ERGO General Insurance Company to Ergo International AG. HDFC made an additional one time provision of Rs 275 crore in Q1 June 2016 towards standard assets and other contingencies.
On consolidated basis, HDFC's net profit rose 26.88% to Rs 2796.92 crore on 18.67% growth in total income to Rs 13531.48 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours on Wednesday, 27 July 2016.
L&T fell 1.01% at Rs 1,558. The company's consolidated net profit rose 46% to Rs 610 crore on 9.1% growth in gross revenue to Rs 21874 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours on Friday, 29 July 2016.
L&T's consolidated order book increased by 8% on year-on-year (YoY) basis to Rs 2.57 lakh crore as on 30 June 2016. International order book constituted 29% of the total order book.
On future business outlook, L&T said that on the international front, the company will continue to target select prospects in the space of core infrastructure and oil & gas sector in the Middle East, Africa and other neighboring countries. The company said it has recently finalised its strategic plan for five years with a focus on profitable growth. L&T said it remains well placed to benefit from emerging opportunities with its execution capabilities and leadership position in various sectors.
Bharti Airtel fell 1.50% to Rs 362.05 after consolidated net profit fell 30.8% to Rs 1462 crore on 7.9% increase in total revenues to Rs 25546 crore in Q1 June 2016 over Q1 June 2015. The company's consolidated revenues grew 8.4% to Rs 25546 crore in Q1 June 2016 over Q1 June 2015 on an underlying basis, adjusted for Africa divested operating unit and tower assets sale.
Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 16.4% to Rs 9591 crore in Q1 June 2016 over Q1 June 2015. The EBITDA margin edged up to 37.5% in Q1 June 2016 from 34.8% in Q1 June 2015.
The company has adopted Indian Accounting Standards (Ind-AS) for its consolidated results effective 1 April 2016 with periods reinstated for like to like comparison.
Consolidated mobile data revenues grew by 34.1% to Rs 4640 crore in Q1 June 2016 over Q1 June 2015.
India revenues grew by 10.3% to Rs 19155 crore in Q1 June 2016 over Q1 June 2015. This was led by healthy growth of 9.1% in Mobile, 11.0% in Homes, 22.2% in Digital TV and 10.4% in Airtel Business on year-on-year (Y-o-Y) basis. The result was announced on Wednesday 27 July 2016.
Dr Reddy's Laboratories slumped 18.53% to Rs 2,937.25. It was the biggest Sensex loser last week. The selling in the counter was triggered by a slew of brokerages cut their ratings on the stock following weaker-than-expected Q1 earnings. The company's consolidated net profit fell 77.2% to Rs 146.20 crore on 14.1% decline in total income to Rs 3289.50 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours on Tuesday, 26 July 2016.
At the time of announcing Q1 June 2016 results, DRL said that its top and bottom lines were impacted by a decline in volume growth, particularly in the US market and the loss of business in Venezuela. The company also faced a number of challenges in Q1 June 2016 including price erosion and delayed launches as a result of the warning letter, which significantly impacted its earnings.
In a conference call held after market hours on Tuesday, 26 July 2016, DRL's executives reportedly indicated a tough Q2 September 2016, as price and volume erosion of some key products is expected to continue in the absence of any significant new generic approvals. Also there are concerns that competitive pressures in the US, may linger for the balance of the year, reports indicated. The company is losing a key contract supply account of McNeil Consumer Healthcare from its Shreveport facility, Louisiana, which is set to have an impact of $25 million on net profits of the company in coming quarters, reports said.
THE END SESSION ( 29 - 07 - 2016 )
Key indices snap two-day winning streak
Losses in telecom stocks and index heavyweights HDFC and Reliance Industries led losses for key benchmark indices on the last trading session of the week. The barometer index, the S&P BSE Sensex lost 156.76 points or 0.56% to settle at 28,051.86. The decline in the Nifty 50 index was lower than the Sensex's fall in percentage terms. The Nifty shed 27.80 points or 0.32% to settle at 8,638.50. Weakness in Asian stocks weighed on sentiment on the domestic bourses. The Sensex and the Nifty snapped two-day winning streak.
In its monsoon update issued yesterday, 28 July 2016, the India Meteorological Department (IMD) said that for the country as a whole, cumulative rainfall during this year's monsoon as on 27 July 2016, was at 0% above the Long Period Average (LPA).
Stocks of public sector banks declined. Stocks of private sector banks were mixed. ICICI Bank edged lower ahead of its Q1 June 2016 results today, 29 July 2016. Eicher Motors (EML) surged after the company reported strong Q1 earnings. Tata Power Company edged higher after the company's equal joint venture with Exxaro Resources achieved commercial operations for its 134 megawatts wind power project in South Africa.
In overseas stock markets, most European stocks edged higher helped by a rally in bank stocks. Asian stocks edged lower after the Bank of Japan's (BOJ) modest easing action dissapointed investors. In Japan, the Nikkei 225 Average ended 0.56% higher. The Japan's central bank BOJ kept interest rates and government bond buying unchanged after the conclusion of a two-day monetary policy meeting. The Nikkei 225 Average was currently up 0.04%. The Japan's central bank said it would buy ¥6 trillion worth of exchange-traded funds annually, up from ¥3.3 trillion previously, in an attempt to stoke inflation and growth by pumping money into the economy. BOJ said it would leave its asset-purchase target at ¥80 trillion a year. US stocks closed slightly higher yesterday, 28 July 2016 amid declines in oil prices, as major tech stocks gained.
The Sensex lost 156.76 points or 0.56% to settle at 28,051.86, its lowest closing level since 27 July 2016. The index rose 24.85 points or 0.08% at the day's high of 28,233.47. The index lost 170.75 points or 0.6% at the day's low of 28,037.87.
The Nifty shed 27.80 points or 0.32% to settle at 8,638.50, its lowest closing level since 27 July 2016. The index rose 4.05 points or 0.04% at the day's high of 8,670.35. The index lost 35.15 points or 0.4% at the day's low of 8,631.15.
The BSE Mid-Cap index rose 0.7%. The BSE Small-Cap index was up 0.23%. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was negative. On BSE, 1,223 shares rose and 1,458 shares declined. A total of 214 shares were unchanged.
The total turnover on BSE amounted to Rs 3657 crore, lower than turnover of Rs 4042.79 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE Telecom index (down 1.64%), the BSE Bankex index (down 0.63%), the BSE Capital Goods index (down 0.73%) and the BSE Metal index (down 0.63%) underperformed the Sensex. The BSE Healthcare index (up 0.72%), the BSE Auto index (up 0.79%) and the BSE Oil & Gas index (up 0.51%) outperformed the Sensex.
Stocks of public sector banks declined. Punjab National Bank (down 4.3%), Canara Bank (down 2.73%), Union Bank of India (down 1.54%), Bank of Baroda (down 1.42%), State Bank of India (down 0.82%) and IDBI Bank (down 0.71%) edged lower. Indian Bank (up 1.96%) and Bank of India (up 0.41%) edged higher.
Stocks of private sector banks were mixed. Kotak Mahindra Bank (up 1.7%), IndusInd Bank (up 0.86%) and Axis Bank (up 0.51%) edged higher. Yes Bank (down 0.27%) edged lower.
Index heavyweight HDFC Bank was down 0.11%.
ICICI Bank was down 3.4%. The bank is scheduled to announce Q1 June 2016 results today, 29 July 2016.
L&T was down 1.2% at Rs 1,558. The company's consolidated net profit rose 46% to Rs 610 crore on 9.1% growth in gross revenue to Rs 21874 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours today, 29 July 2016.
L&T's consolidated order book increased by 8% on year-on-year (YoY) basis to Rs 2.57 lakh crore as on 30 June 2016. International order book constituted 29% of the total order book.
On future business outlook, L&T said that on the international front, the company will continue to target select prospects in the space of core infrastructure and oil & gas sector in the Middle East, Africa and other neighboring countries. The company said it has recently finalised its strategic plan for five years with a focus on profitable growth. L&T said it remains well placed to benefit from emerging opportunities with its execution capabilities and leadership position in various sectors.
Telecom stocks edged lower. Bharti Airtel (down 2.7%) and Idea Cellular (down 0.57%) declined. Reliance Communications (up 2.14%) edged higher.
Bharti Infratel was off 0.8%. Bharti Infratel is a telecom tower arm of Bharti Airtel.
Index heavyweight Reliance Industries was down 1.03% at Rs 1,015.50.
Index heavyweight and housing finance major HDFC was down 1.92%. HDFC announced during market hours today, 29 July 2016 that it intends to raise Rs 1500 crore through issue of secured redeemable non-convertible debentures (NCDs) on private placement basis. The debentures have a tenor of 1 year 166 days and carry a coupon rate of 8% per annum. The issue opens and closes on the same day on 2 August 2016. The company intends to utilize the proceeds from the issue for financing/refinancing its housing finance business requirements.
Eicher Motors (EML) surged after the company reported strong Q1 earnings. The stock was up 6.6%. The stock hit a record high of Rs 22,567 in intraday trade. EML's consolidated net profit surged 58.6% to Rs 376 crore on 42% growth in total income from operations to Rs 1556 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 28 July 2016.
The company's earnings before interest, taxation, depreciation and amortization (EBITDA) surged 64.6% to Rs 470 crore in Q1 June 2016 over Q1 June 2015. EBITDA margin expanded to 30.2% in Q1 June 2016 from 26.1% in Q1 June 2015.
EML's Managing Director & CEO Siddhartha Lal said that the management's immediate business outlook for Royal Enfield business remains strong and it continues to grow consistently, competitively and profitably towards leading and expanding the mid-sized motorcyle segment globally.
Commenting on VE Commercial Vehicles' (VECV) performance, Siddhartha said that VECV demonstrated an impressive performance in Q1 June 2016 with sales of 16,071 units recording a growth of 32.5% over Q1 June 2015. VECV also increased its overall market share to 15.1% in Q1 June 2016, as compared to 13.2% recorded in Q1 June 2015. VECV continues to do well in the sub 5-ton category with the introduction of Pro 1049 where it is currently selling more than 100 trucks every month since its launch in the last quarter. Eicher Motors' 50:50 joint venture with Polaris Industries, Eicher Polaris Private Ltd., through its product Multix is generating a lot of interest among its target customers. Multix is now present in 50 locations across 8 states and it continues to gain momentum in its target markets, he further added.
Tata Power Company edged higher after the company's equal joint venture with Exxaro Resources achieved commercial operations for its 134 megawatts wind power project in South Africa. The stock was up 1.77%. The wind power project is being implemented by Cennergi (Pty) Ltd. Tata Power further said that Cennergi's second wind power project in South Africa is also expected to go into commercial operations shortly. Cennergi, an equal joint venture between Tata Power Company and Exxaro Resources, is focusing on the development, ownership, operation, maintenance, acquisition and management of electricity generation projects in South Africa, Botswana and Namibia. Cennergi's initial project pipeline focuses on renewable energy projects in South Africa. The company's strategy is to create a balanced portfolio of power generation assets. The announcement was made during market hours today, 29 July 2016.
The Sensex and the Nifty snapped two-day winning streak. The Sensex had risen 232.10 points or 0.83% in the preceding two trading sessions to settle at 28,208.62 yesterday, 28 July 2016, from its close of 27,976.52 on 26 July 2016. The Sensex has risen 1,052.14 points or 3.89% in July 2016. The Sensex has risen 1,934.32 points or 7.4% in calendar year 2016 so far (till 29 July 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 5,557.25 points or 24.7%. The Sensex is off 365.73 points or 1.28% from a 52-week high of 28,417.59 hit on 10 August 2015. The Sensex is off 1,972.88 points or 6.57% from a record high of 30,024.74 hit on 4 March 2015.
According to reports, the government today, 29 July 2016, listed the much-awaited Goods and Services Tax (GST) bill for consideration and passage in Rajya Sabha's agenda for the next week. Minister of state for parliamentary affairs Mukhtar Abbas Naqvi, while making a statement regarding government business for the week starting 1 August in the Upper House, reportedly said that the GST constitutional amendment bill will be taken up for consideration and passage in the Rajya Sabha.
The GST bill, which has been approved by the Lok Sabha is pending in the Rajya Sabha. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax. The month-long monsoon session of the parliament will conclude on 12 August 2016.
In its monsoon update issued yesterday, 28 July 2016, the India Meteorological Department (IMD) said that for the country as a whole, cumulative rainfall during this year's monsoon as on 27 July 2016, was at 0% above the Long Period Average (LPA).
Stocks of public sector banks declined. Stocks of private sector banks were mixed. ICICI Bank edged lower ahead of its Q1 June 2016 results today, 29 July 2016. Eicher Motors (EML) surged after the company reported strong Q1 earnings. Tata Power Company edged higher after the company's equal joint venture with Exxaro Resources achieved commercial operations for its 134 megawatts wind power project in South Africa.
In overseas stock markets, most European stocks edged higher helped by a rally in bank stocks. Asian stocks edged lower after the Bank of Japan's (BOJ) modest easing action dissapointed investors. In Japan, the Nikkei 225 Average ended 0.56% higher. The Japan's central bank BOJ kept interest rates and government bond buying unchanged after the conclusion of a two-day monetary policy meeting. The Nikkei 225 Average was currently up 0.04%. The Japan's central bank said it would buy ¥6 trillion worth of exchange-traded funds annually, up from ¥3.3 trillion previously, in an attempt to stoke inflation and growth by pumping money into the economy. BOJ said it would leave its asset-purchase target at ¥80 trillion a year. US stocks closed slightly higher yesterday, 28 July 2016 amid declines in oil prices, as major tech stocks gained.
The Sensex lost 156.76 points or 0.56% to settle at 28,051.86, its lowest closing level since 27 July 2016. The index rose 24.85 points or 0.08% at the day's high of 28,233.47. The index lost 170.75 points or 0.6% at the day's low of 28,037.87.
The Nifty shed 27.80 points or 0.32% to settle at 8,638.50, its lowest closing level since 27 July 2016. The index rose 4.05 points or 0.04% at the day's high of 8,670.35. The index lost 35.15 points or 0.4% at the day's low of 8,631.15.
The BSE Mid-Cap index rose 0.7%. The BSE Small-Cap index was up 0.23%. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was negative. On BSE, 1,223 shares rose and 1,458 shares declined. A total of 214 shares were unchanged.
The total turnover on BSE amounted to Rs 3657 crore, lower than turnover of Rs 4042.79 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE Telecom index (down 1.64%), the BSE Bankex index (down 0.63%), the BSE Capital Goods index (down 0.73%) and the BSE Metal index (down 0.63%) underperformed the Sensex. The BSE Healthcare index (up 0.72%), the BSE Auto index (up 0.79%) and the BSE Oil & Gas index (up 0.51%) outperformed the Sensex.
Stocks of public sector banks declined. Punjab National Bank (down 4.3%), Canara Bank (down 2.73%), Union Bank of India (down 1.54%), Bank of Baroda (down 1.42%), State Bank of India (down 0.82%) and IDBI Bank (down 0.71%) edged lower. Indian Bank (up 1.96%) and Bank of India (up 0.41%) edged higher.
Stocks of private sector banks were mixed. Kotak Mahindra Bank (up 1.7%), IndusInd Bank (up 0.86%) and Axis Bank (up 0.51%) edged higher. Yes Bank (down 0.27%) edged lower.
Index heavyweight HDFC Bank was down 0.11%.
ICICI Bank was down 3.4%. The bank is scheduled to announce Q1 June 2016 results today, 29 July 2016.
L&T was down 1.2% at Rs 1,558. The company's consolidated net profit rose 46% to Rs 610 crore on 9.1% growth in gross revenue to Rs 21874 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours today, 29 July 2016.
L&T's consolidated order book increased by 8% on year-on-year (YoY) basis to Rs 2.57 lakh crore as on 30 June 2016. International order book constituted 29% of the total order book.
On future business outlook, L&T said that on the international front, the company will continue to target select prospects in the space of core infrastructure and oil & gas sector in the Middle East, Africa and other neighboring countries. The company said it has recently finalised its strategic plan for five years with a focus on profitable growth. L&T said it remains well placed to benefit from emerging opportunities with its execution capabilities and leadership position in various sectors.
Telecom stocks edged lower. Bharti Airtel (down 2.7%) and Idea Cellular (down 0.57%) declined. Reliance Communications (up 2.14%) edged higher.
Bharti Infratel was off 0.8%. Bharti Infratel is a telecom tower arm of Bharti Airtel.
Index heavyweight Reliance Industries was down 1.03% at Rs 1,015.50.
Index heavyweight and housing finance major HDFC was down 1.92%. HDFC announced during market hours today, 29 July 2016 that it intends to raise Rs 1500 crore through issue of secured redeemable non-convertible debentures (NCDs) on private placement basis. The debentures have a tenor of 1 year 166 days and carry a coupon rate of 8% per annum. The issue opens and closes on the same day on 2 August 2016. The company intends to utilize the proceeds from the issue for financing/refinancing its housing finance business requirements.
Eicher Motors (EML) surged after the company reported strong Q1 earnings. The stock was up 6.6%. The stock hit a record high of Rs 22,567 in intraday trade. EML's consolidated net profit surged 58.6% to Rs 376 crore on 42% growth in total income from operations to Rs 1556 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 28 July 2016.
The company's earnings before interest, taxation, depreciation and amortization (EBITDA) surged 64.6% to Rs 470 crore in Q1 June 2016 over Q1 June 2015. EBITDA margin expanded to 30.2% in Q1 June 2016 from 26.1% in Q1 June 2015.
EML's Managing Director & CEO Siddhartha Lal said that the management's immediate business outlook for Royal Enfield business remains strong and it continues to grow consistently, competitively and profitably towards leading and expanding the mid-sized motorcyle segment globally.
Commenting on VE Commercial Vehicles' (VECV) performance, Siddhartha said that VECV demonstrated an impressive performance in Q1 June 2016 with sales of 16,071 units recording a growth of 32.5% over Q1 June 2015. VECV also increased its overall market share to 15.1% in Q1 June 2016, as compared to 13.2% recorded in Q1 June 2015. VECV continues to do well in the sub 5-ton category with the introduction of Pro 1049 where it is currently selling more than 100 trucks every month since its launch in the last quarter. Eicher Motors' 50:50 joint venture with Polaris Industries, Eicher Polaris Private Ltd., through its product Multix is generating a lot of interest among its target customers. Multix is now present in 50 locations across 8 states and it continues to gain momentum in its target markets, he further added.
Tata Power Company edged higher after the company's equal joint venture with Exxaro Resources achieved commercial operations for its 134 megawatts wind power project in South Africa. The stock was up 1.77%. The wind power project is being implemented by Cennergi (Pty) Ltd. Tata Power further said that Cennergi's second wind power project in South Africa is also expected to go into commercial operations shortly. Cennergi, an equal joint venture between Tata Power Company and Exxaro Resources, is focusing on the development, ownership, operation, maintenance, acquisition and management of electricity generation projects in South Africa, Botswana and Namibia. Cennergi's initial project pipeline focuses on renewable energy projects in South Africa. The company's strategy is to create a balanced portfolio of power generation assets. The announcement was made during market hours today, 29 July 2016.
The Sensex and the Nifty snapped two-day winning streak. The Sensex had risen 232.10 points or 0.83% in the preceding two trading sessions to settle at 28,208.62 yesterday, 28 July 2016, from its close of 27,976.52 on 26 July 2016. The Sensex has risen 1,052.14 points or 3.89% in July 2016. The Sensex has risen 1,934.32 points or 7.4% in calendar year 2016 so far (till 29 July 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 5,557.25 points or 24.7%. The Sensex is off 365.73 points or 1.28% from a 52-week high of 28,417.59 hit on 10 August 2015. The Sensex is off 1,972.88 points or 6.57% from a record high of 30,024.74 hit on 4 March 2015.
According to reports, the government today, 29 July 2016, listed the much-awaited Goods and Services Tax (GST) bill for consideration and passage in Rajya Sabha's agenda for the next week. Minister of state for parliamentary affairs Mukhtar Abbas Naqvi, while making a statement regarding government business for the week starting 1 August in the Upper House, reportedly said that the GST constitutional amendment bill will be taken up for consideration and passage in the Rajya Sabha.
The GST bill, which has been approved by the Lok Sabha is pending in the Rajya Sabha. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax. The month-long monsoon session of the parliament will conclude on 12 August 2016.
Thursday, July 28, 2016
THE END SESSION ( 28 - 07 - 2016 )
Nifty settles at over 15-months high
Key benchmark indices registered decent gains on hopes that the Goods & Services Tax (GST) bill inched closer to becoming a reality after media reports suggested that the Union Cabinet approved amendments to the constitutional amendment bill, incorporating suggestions by some of the states and opposition parties. The barometer index, the S&P BSE Sensex, rose 184.29 points or 0.66% to settle at 28,208.62. The Nifty 50 index rose 50.50 points or 0.59% to settle at 8,666.30. Market sentiment was also boosted after the US Federal Reserve has opted to keep interest rates at ultra-low level after the conclusion of a two-day monetary policy meeting. The ultra-loose monetary policy in the US has encouraged heavy investment in higher-yielding emerging markets. The Sensex and Nifty extended intraday gains in late trade after hovering in positive zone throughout the trading session. The Sensex settled at its highest level in almost 12 months. The Nifty settled at its highest level in more than 15 months.
According to reports, the Union Cabinet yesterday, 27 July 2016, cleared changes in the constitutional amendment bill on Goods and Services Tax (GST) including doing away with the additional 1% tax by producing states and compensating all states for any revenue loss in the first five years post the GST rollout. The Cabinet, headed by Prime Minister Narendra Modi, decided not to accede to the Congress party's demand of specifying the GST rate in the Constitution itself, reports suggested. It is likely to be part of the GST bill that will be legislated separately by both the Centre and states, as per reports.
The GST bill is likely to be moved in the Rajya Sabha next week. The GST bill, which has been approved by the Lok Sabha is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax. The month-long monsoon session of the parliament will conclude on 12 August 2016.
The Sensex rose 184.29 points or 0.66% to settle at 28,208.62, its highest closing level since 7 August 2015. The index rose 215.87 points or 0.77% at the day's high of 28,240.20. The index rose 40.57 points or 0.14% at the day's low of 28,064.90.
The Nifty 50 index rose 50.50 points or 0.59% to settle at 8,666.30, its highest closing level since 16 April 2015. The index rose 58.40 points or 0.67% at the day's high of 8,674.20. The index rose 9.45 points or 0.1% at the day's low of 8,625.25.
The market breadth indicating the overall health of the market was positive. On BSE, 1,486 shares rose and 1,164 shares declined. A total of 228 shares were unchanged. The BSE Mid-Cap index rose 0.62%. The BSE Small-Cap index rose 0.60%. Both these indices underperformed the Sensex.
The total turnover on BSE amounted to Rs 4026 crore, higher than turnover of Rs 3487.26 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE Capital Goods index (down 0.84%), the S&P BSE Metal index (down 0.74%), the S&P BSE Industrials index (down 0.44%), the S&P BSE Oil & Gas index (down 0.12%), the S&P BSE IT index (up 0.10%), the S&P BSE Teck index (up 0.17%), the S&P BSE Bankex (up 0.25%), the S&P BSE Basic Materials index (up 0.26%), the S&P BSE Healthcare index (up 0.41%), the S&P BSE Finance index (up 0.48%), the S&P BSE Energy index (up 0.53%) and the S&P BSE Power index (up 0.56%), underperformed the Sensex. The S&P BSE Utilities index (up 0.66%), matching the Sensex's rise in percentage terms. The S&P BSE Telecom index (up 0.75%), the S&P BSE Auto index (up 0.81%), the S&P BSE Realty index (up 0.95%), the S&P BSE Consumer Discretionary Goods & Services index (up 1.49%), the S&P BSE FMCG index (up 1.50%) and the S&P BSE Consumer Durables index (up 2.30%), outperformed the Sensex.
In overseas stock markets, European and Asian stocks were mixed. In Japan, the Nikkei 225 Average ended 1.13% lower. Investors are hoping for further easing of monetary policy from the Bank of Japan (BOJ) after the conclusion of a two-day monetary policy meeting on 28-29 July 2016. Strength in the yen against the dollar post last month's Brexit vote and data showing a slowdown in the Japanese economy have triggered expectations of further easing of monetary policy from the BOJ. A stronger yen hurts the competitiveness of Japanese exporters.
US stocks closed mixed yesterday, 27 July 2016, after the Federal Reserve statement and major earnings reports. The Federal Open Market Committee (FOMC) has decided not to raise interest rates, maintaining the ultra-low level they have been at since December 2015. The US central bank opted to keep rates between 0.25% and 0.5%. The Fed said near-term risks to the economic outlook have diminished but inflation remained below the bank's target.
Automobiles maker Eicher Motors rose 3.64% to Rs 21,075.20. The company's consolidated net profit surged 58.61% to Rs 376.29 crore on 42.81% growth in total income to Rs 1602.51 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours today, 28 July 2016.
Bank stocks were mixed. Among public sector banks, Union Bank of India (down 0.84%) and IDBI Bank (down 2.36%) declined.
The Reserve Bank of India (RBI) yesterday, 27 July 2016 said that it has imposed monetary penalty on 13 banks for violation of regulatory directions/instructions/guidelines, among other things, on KYC norms.
Allahabad Bank rose 0.19%. The central bank imposed a penalty of Rs 2 crore on the bank.
Bank of India fell 1.34%. The central bank imposed a penalty of Rs 1 crore on the bank.
Bank of Baroda fell 0.19%. The central bank imposed a penalty of Rs 5 crore on the bank.
Canara Bank fell 1.11%. The central bank imposed a penalty of Rs 2 crore on the bank.
Punjab National Bank fell 2.82%. The central bank imposed a penalty of Rs 3 crore on the bank.
State Bank of Bikaner & Jaipur fell 0.94%. The central bank imposed a penalty of Rs 2 crore on the bank.
Syndicate Bank rose 1.32%. The central bank imposed a penalty of Rs 3 crore on the bank.
UCO Bank fell 0.58%. The central bank imposed a penalty of Rs 2 crore on the bank.
State Bank of Mysore fell 2.06%. The central bank imposed a penalty of Rs 1 crore on the bank.
Corporation Bank fell 0.82%. The central bank imposed a penalty of Rs 1 crore on the bank.
Eight other banks, namely, Axis Bank, Federal Bank, ICICI Bank, Kotak Mahindra Bank, OBC, Standard Chartered Bank, SBI and Union Bank of India have been advised by the central bank to put in place appropriate measures and review them from time to time to ensure strict compliance of KYC requirements and FEMA provisions on an ongoing basis.
Among private sector banks, ICICI Bank (up 0.82%) and Yes Bank (up 1.70%) edged higher. Kotak Mahindra Bank (down 0.63%) and Axis Bank (down 0.98%) edged lower.
Index heavyweight HDFC Bank rose 0.89%. The central bank imposed a penalty of Rs 2 crore on the bank.
IndusInd Bank fell 0.86%. The central bank imposed a penalty of Rs 2 crore on the bank.
Cement stocks edged higher on renewed buying. Shree Cement (up 2.35%), Ambuja Cements (up 1.36%), UltraTech Cement (up 0.16%) and ACC (up 0.81%) rose.
Grasim Industries fell 0.38%. Grasim has exposure to cement sector through its holding in UltraTech Cement.
Asian Paints jumped after the company reported strong Q1 results. The stock rose 6.14% at Rs 1,126.95. The stock hit a record high of Rs 1,152.65 in intraday trade. The stock hit a low of Rs 1,067.25 in intraday trade. The company's consolidated net profit after minority interest rose 17.9% to Rs 535 crore on 10.2% increase interest from operations to Rs 4082.10 crore in Q1 June 2016 over Q1 June 2015. Profit before depreciation, interest, and taxes (PBDIT) rose 20.9% to Rs 820.30 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 27 July 2016.
K.B.S. Anand, Managing Director & CEO, Asian Paints said that the decorative business segment India registered double digit growth during the quarter. Lower raw material prices led to improved margins. Industrial business registered good growth in the industrial liquid paints category for the company's joint venture (JV) AP-PPG while the other JV PPG-AP saw good demand in the auto original equipment manufacturers (OEM) and general industrial segment. The company's international business performed well, aided by good growth in markets like Nepal, UAE and Fiji. Both the segments in the home improvement category -- the Kitchen (Sleek) and Bath (ESS ESS) businesses -- delivered good topline growth in the quarter as compared to the previous year.
Bharti Airtel dropped 0.12% at Rs 372.10 after consolidated net profit fell 30.8% to Rs 1462 crore on 7.9% increase in total revenue to Rs 25546 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 27 July 2016.
The consolidated revenue grew 8.4% to Rs 25546 crore in Q1 June 2016 over Q1 June 2015 on an underlying basis, adjusted for Africa divested operating unit and tower assets sale.
Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 16.4% to Rs 9591 crore in Q1 June 2016 over Q1 June 2015. The EBITDA margin edged up to 37.5% in Q1 June 2016 from 34.8% in Q1 June 2015.
The company has adopted Indian Accounting Standards (Ind-AS) for its consolidated results effective 1 April 2016 with periods reinstated for like to like comparison.
Consolidated mobile data revenue grew by 34.1% to Rs 4640 crore in Q1 June 2016 over Q1 June 2015.
India revenues grew by 10.3% to Rs 19155 crore in Q1 June 2016 over Q1 June 2015. This was led by healthy growth of 9.1% in Mobile, 11.0% in Homes, 22.2% in Digital TV and 10.4% in Airtel Business on year-on-year (Y-o-Y) basis.
The company has realigned its India segment reporting in line with management reorganisation. Consequently, Airtel Business also now includes the erstwhile Corporate fixed line voice and fixed line data business which was hitherto reported with Telemedia segment. Mobile data revenues cross Rs 3500 crore and at Rs 3525 crore grew by 35.1% Y-o-Y, led by increase in the data customer base by 19.1% and traffic by 54.9%. Mobile broadband customers increased by 68.3% to 36.6 million from 21.7 million in the corresponding quarter last year. Data average revenue per user (ARPU) has moved up by Rs 21 Y-o-Y to Rs 202 in Q1 June 2016, led by 28.1% increase in usage per customer. Mobile Data revenues now contribute to 23.7% of Mobile India revenues vis-à-vis 19.2% in the corresponding quarter last year.
Passenger car major Maruti Suzuki India (MSIL) edged higher after the company said that it plans to expand the number of NEXA outlets to 250 by March 2017. The stock rose 4.47%. NEXA is expected to contribute 15% of Maruti's sales by 2020, the company said. MSIL during market hours today, 28 July 2016 said that NEXA, the new automotive sales channel of the company has completed one year of operations. Launched in July 2015, NEXA has enabled MSIL to attract new categories of customers to its fold. NEXA has rapidly grown to 150 showrooms across 94 cities. Over 1 lakh cars have been sold through NEXA. This is about 10% of MSIL's total domestic sales, the company said. At present, the cars sold through NEXA are premium cross-over, S-Cross and premium hatchback, Baleno.
Sun Pharmaceutical Industries (Sun Pharma) rose 1.99% after the company said it signed an agreement with RPG Life Sciences on 27 July 2016 to divest seven prescription brands in India, owned by Sun Pharma and its subsidiary, for a consideration of Rs 41 crore. The seven divested brands include brands used for treatment of respiratory-track infections, urological disorders, cardiovascular diseases and brands in health supplements segment. This divestment is subject to receipt of Competition Commission of India's (CCI) approval. The announcement was made after market hours yesterday, 27 July 2016.
Separately, Sun Pharma before market hours today, 28 July 2016, announced a licencing agreement with Almirall on the development and commercialization of Tildrakizumab for psoriasis in Europe. Tildrakizumab is an investigational IL-23p19 inhibitor currently being evaluated in patients with moderate-to-severe plaque psoriasis. Under the terms of the licence agreement, Almirall will pay Sun Pharma an initial upfront payment of $50 million. Phase-3 studies of Tildrakizumab have recently been completed. Sun Pharma will be eligible to receive development and regulatory milestone payments and, additionally, sales milestone payments and royalties on net sales, the terms of which are confidential. Almirall will be able to lead European studies, and participate in larger global clinical studies for psoriasis indication subject to the terms of the Sun Pharma-Merck agreements, as well as certain cost sharing agreements. Sun Pharma will continue to lead development of Tildrakizumab for other indications, where Almirall will have right of first negotiation for certain indications in Europe. Additionally, the license agreement has a provision for possible co-promotion agreement at some point in the future, subject to certain conditions, Sun Pharma said in a statement.
The Sensex and the Nifty edged higher for the second straight trading session. The Sensex has risen 232.10 points or 0.83% in two trading sessions from its close of 27,976.52 on 26 July 2016. The Sensex has risen 1,208.90 points or 4.48% in this month so far (till 28 July 2016). The Sensex has risen 2,091.08 points or 8.01% in calendar year 2016 so far (till 28 July 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 5,714.01 points or 25.40%. The Sensex is off 208.97 points or 0.74% from a 52-week high of 28,417.59 hit on 10 August 2015. The Sensex is off 1,816.12 points or 6.05% from a record high of 30,024.74 hit on 4 March 2015.
According to reports, the Union Cabinet yesterday, 27 July 2016, cleared changes in the constitutional amendment bill on Goods and Services Tax (GST) including doing away with the additional 1% tax by producing states and compensating all states for any revenue loss in the first five years post the GST rollout. The Cabinet, headed by Prime Minister Narendra Modi, decided not to accede to the Congress party's demand of specifying the GST rate in the Constitution itself, reports suggested. It is likely to be part of the GST bill that will be legislated separately by both the Centre and states, as per reports.
The GST bill is likely to be moved in the Rajya Sabha next week. The GST bill, which has been approved by the Lok Sabha is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax. The month-long monsoon session of the parliament will conclude on 12 August 2016.
The Sensex rose 184.29 points or 0.66% to settle at 28,208.62, its highest closing level since 7 August 2015. The index rose 215.87 points or 0.77% at the day's high of 28,240.20. The index rose 40.57 points or 0.14% at the day's low of 28,064.90.
The Nifty 50 index rose 50.50 points or 0.59% to settle at 8,666.30, its highest closing level since 16 April 2015. The index rose 58.40 points or 0.67% at the day's high of 8,674.20. The index rose 9.45 points or 0.1% at the day's low of 8,625.25.
The market breadth indicating the overall health of the market was positive. On BSE, 1,486 shares rose and 1,164 shares declined. A total of 228 shares were unchanged. The BSE Mid-Cap index rose 0.62%. The BSE Small-Cap index rose 0.60%. Both these indices underperformed the Sensex.
The total turnover on BSE amounted to Rs 4026 crore, higher than turnover of Rs 3487.26 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE Capital Goods index (down 0.84%), the S&P BSE Metal index (down 0.74%), the S&P BSE Industrials index (down 0.44%), the S&P BSE Oil & Gas index (down 0.12%), the S&P BSE IT index (up 0.10%), the S&P BSE Teck index (up 0.17%), the S&P BSE Bankex (up 0.25%), the S&P BSE Basic Materials index (up 0.26%), the S&P BSE Healthcare index (up 0.41%), the S&P BSE Finance index (up 0.48%), the S&P BSE Energy index (up 0.53%) and the S&P BSE Power index (up 0.56%), underperformed the Sensex. The S&P BSE Utilities index (up 0.66%), matching the Sensex's rise in percentage terms. The S&P BSE Telecom index (up 0.75%), the S&P BSE Auto index (up 0.81%), the S&P BSE Realty index (up 0.95%), the S&P BSE Consumer Discretionary Goods & Services index (up 1.49%), the S&P BSE FMCG index (up 1.50%) and the S&P BSE Consumer Durables index (up 2.30%), outperformed the Sensex.
In overseas stock markets, European and Asian stocks were mixed. In Japan, the Nikkei 225 Average ended 1.13% lower. Investors are hoping for further easing of monetary policy from the Bank of Japan (BOJ) after the conclusion of a two-day monetary policy meeting on 28-29 July 2016. Strength in the yen against the dollar post last month's Brexit vote and data showing a slowdown in the Japanese economy have triggered expectations of further easing of monetary policy from the BOJ. A stronger yen hurts the competitiveness of Japanese exporters.
US stocks closed mixed yesterday, 27 July 2016, after the Federal Reserve statement and major earnings reports. The Federal Open Market Committee (FOMC) has decided not to raise interest rates, maintaining the ultra-low level they have been at since December 2015. The US central bank opted to keep rates between 0.25% and 0.5%. The Fed said near-term risks to the economic outlook have diminished but inflation remained below the bank's target.
Automobiles maker Eicher Motors rose 3.64% to Rs 21,075.20. The company's consolidated net profit surged 58.61% to Rs 376.29 crore on 42.81% growth in total income to Rs 1602.51 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours today, 28 July 2016.
Bank stocks were mixed. Among public sector banks, Union Bank of India (down 0.84%) and IDBI Bank (down 2.36%) declined.
The Reserve Bank of India (RBI) yesterday, 27 July 2016 said that it has imposed monetary penalty on 13 banks for violation of regulatory directions/instructions/guidelines, among other things, on KYC norms.
Allahabad Bank rose 0.19%. The central bank imposed a penalty of Rs 2 crore on the bank.
Bank of India fell 1.34%. The central bank imposed a penalty of Rs 1 crore on the bank.
Bank of Baroda fell 0.19%. The central bank imposed a penalty of Rs 5 crore on the bank.
Canara Bank fell 1.11%. The central bank imposed a penalty of Rs 2 crore on the bank.
Punjab National Bank fell 2.82%. The central bank imposed a penalty of Rs 3 crore on the bank.
State Bank of Bikaner & Jaipur fell 0.94%. The central bank imposed a penalty of Rs 2 crore on the bank.
Syndicate Bank rose 1.32%. The central bank imposed a penalty of Rs 3 crore on the bank.
UCO Bank fell 0.58%. The central bank imposed a penalty of Rs 2 crore on the bank.
State Bank of Mysore fell 2.06%. The central bank imposed a penalty of Rs 1 crore on the bank.
Corporation Bank fell 0.82%. The central bank imposed a penalty of Rs 1 crore on the bank.
Eight other banks, namely, Axis Bank, Federal Bank, ICICI Bank, Kotak Mahindra Bank, OBC, Standard Chartered Bank, SBI and Union Bank of India have been advised by the central bank to put in place appropriate measures and review them from time to time to ensure strict compliance of KYC requirements and FEMA provisions on an ongoing basis.
Among private sector banks, ICICI Bank (up 0.82%) and Yes Bank (up 1.70%) edged higher. Kotak Mahindra Bank (down 0.63%) and Axis Bank (down 0.98%) edged lower.
Index heavyweight HDFC Bank rose 0.89%. The central bank imposed a penalty of Rs 2 crore on the bank.
IndusInd Bank fell 0.86%. The central bank imposed a penalty of Rs 2 crore on the bank.
Cement stocks edged higher on renewed buying. Shree Cement (up 2.35%), Ambuja Cements (up 1.36%), UltraTech Cement (up 0.16%) and ACC (up 0.81%) rose.
Grasim Industries fell 0.38%. Grasim has exposure to cement sector through its holding in UltraTech Cement.
Asian Paints jumped after the company reported strong Q1 results. The stock rose 6.14% at Rs 1,126.95. The stock hit a record high of Rs 1,152.65 in intraday trade. The stock hit a low of Rs 1,067.25 in intraday trade. The company's consolidated net profit after minority interest rose 17.9% to Rs 535 crore on 10.2% increase interest from operations to Rs 4082.10 crore in Q1 June 2016 over Q1 June 2015. Profit before depreciation, interest, and taxes (PBDIT) rose 20.9% to Rs 820.30 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 27 July 2016.
K.B.S. Anand, Managing Director & CEO, Asian Paints said that the decorative business segment India registered double digit growth during the quarter. Lower raw material prices led to improved margins. Industrial business registered good growth in the industrial liquid paints category for the company's joint venture (JV) AP-PPG while the other JV PPG-AP saw good demand in the auto original equipment manufacturers (OEM) and general industrial segment. The company's international business performed well, aided by good growth in markets like Nepal, UAE and Fiji. Both the segments in the home improvement category -- the Kitchen (Sleek) and Bath (ESS ESS) businesses -- delivered good topline growth in the quarter as compared to the previous year.
Bharti Airtel dropped 0.12% at Rs 372.10 after consolidated net profit fell 30.8% to Rs 1462 crore on 7.9% increase in total revenue to Rs 25546 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 27 July 2016.
The consolidated revenue grew 8.4% to Rs 25546 crore in Q1 June 2016 over Q1 June 2015 on an underlying basis, adjusted for Africa divested operating unit and tower assets sale.
Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 16.4% to Rs 9591 crore in Q1 June 2016 over Q1 June 2015. The EBITDA margin edged up to 37.5% in Q1 June 2016 from 34.8% in Q1 June 2015.
The company has adopted Indian Accounting Standards (Ind-AS) for its consolidated results effective 1 April 2016 with periods reinstated for like to like comparison.
Consolidated mobile data revenue grew by 34.1% to Rs 4640 crore in Q1 June 2016 over Q1 June 2015.
India revenues grew by 10.3% to Rs 19155 crore in Q1 June 2016 over Q1 June 2015. This was led by healthy growth of 9.1% in Mobile, 11.0% in Homes, 22.2% in Digital TV and 10.4% in Airtel Business on year-on-year (Y-o-Y) basis.
The company has realigned its India segment reporting in line with management reorganisation. Consequently, Airtel Business also now includes the erstwhile Corporate fixed line voice and fixed line data business which was hitherto reported with Telemedia segment. Mobile data revenues cross Rs 3500 crore and at Rs 3525 crore grew by 35.1% Y-o-Y, led by increase in the data customer base by 19.1% and traffic by 54.9%. Mobile broadband customers increased by 68.3% to 36.6 million from 21.7 million in the corresponding quarter last year. Data average revenue per user (ARPU) has moved up by Rs 21 Y-o-Y to Rs 202 in Q1 June 2016, led by 28.1% increase in usage per customer. Mobile Data revenues now contribute to 23.7% of Mobile India revenues vis-à-vis 19.2% in the corresponding quarter last year.
Passenger car major Maruti Suzuki India (MSIL) edged higher after the company said that it plans to expand the number of NEXA outlets to 250 by March 2017. The stock rose 4.47%. NEXA is expected to contribute 15% of Maruti's sales by 2020, the company said. MSIL during market hours today, 28 July 2016 said that NEXA, the new automotive sales channel of the company has completed one year of operations. Launched in July 2015, NEXA has enabled MSIL to attract new categories of customers to its fold. NEXA has rapidly grown to 150 showrooms across 94 cities. Over 1 lakh cars have been sold through NEXA. This is about 10% of MSIL's total domestic sales, the company said. At present, the cars sold through NEXA are premium cross-over, S-Cross and premium hatchback, Baleno.
Sun Pharmaceutical Industries (Sun Pharma) rose 1.99% after the company said it signed an agreement with RPG Life Sciences on 27 July 2016 to divest seven prescription brands in India, owned by Sun Pharma and its subsidiary, for a consideration of Rs 41 crore. The seven divested brands include brands used for treatment of respiratory-track infections, urological disorders, cardiovascular diseases and brands in health supplements segment. This divestment is subject to receipt of Competition Commission of India's (CCI) approval. The announcement was made after market hours yesterday, 27 July 2016.
Separately, Sun Pharma before market hours today, 28 July 2016, announced a licencing agreement with Almirall on the development and commercialization of Tildrakizumab for psoriasis in Europe. Tildrakizumab is an investigational IL-23p19 inhibitor currently being evaluated in patients with moderate-to-severe plaque psoriasis. Under the terms of the licence agreement, Almirall will pay Sun Pharma an initial upfront payment of $50 million. Phase-3 studies of Tildrakizumab have recently been completed. Sun Pharma will be eligible to receive development and regulatory milestone payments and, additionally, sales milestone payments and royalties on net sales, the terms of which are confidential. Almirall will be able to lead European studies, and participate in larger global clinical studies for psoriasis indication subject to the terms of the Sun Pharma-Merck agreements, as well as certain cost sharing agreements. Sun Pharma will continue to lead development of Tildrakizumab for other indications, where Almirall will have right of first negotiation for certain indications in Europe. Additionally, the license agreement has a provision for possible co-promotion agreement at some point in the future, subject to certain conditions, Sun Pharma said in a statement.
The Sensex and the Nifty edged higher for the second straight trading session. The Sensex has risen 232.10 points or 0.83% in two trading sessions from its close of 27,976.52 on 26 July 2016. The Sensex has risen 1,208.90 points or 4.48% in this month so far (till 28 July 2016). The Sensex has risen 2,091.08 points or 8.01% in calendar year 2016 so far (till 28 July 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 5,714.01 points or 25.40%. The Sensex is off 208.97 points or 0.74% from a 52-week high of 28,417.59 hit on 10 August 2015. The Sensex is off 1,816.12 points or 6.05% from a record high of 30,024.74 hit on 4 March 2015.
Wednesday, July 27, 2016
THE END SESSION ( 27 / 07 / 2016 )
Sensex settles above 28,000 mark
Amid hopes for the passage of the Goods and Services Tax (GST) constitution amendment bill during the ongoing monsoon session of parliament, the two benchmark indices eked out small gains, with the barometer index, the S&P BSE Sensex, moving past the psychologically important 28,000 mark. The Sensex rose 47.81 points or 0.17% to settle at 28,024.33. The gains for the Nifty 50 index were higher than those for the Sensex in percentage terms. The Nifty rose 25.15 points or 0.29% to settle at 8,615.80.
According to reports, the empowered committee of state finance ministers which met Finance Minister Arun Jaitley yesterday, 26 July 2016, has reached a consensus on key aspects of the constitutional amendment bill on Goods and Services Tax (GST). The committee has decided to keep the main GST rate low, according to reports. The GST bill is likely to be moved in the Rajya Sabha next week. The Rajya Sabha has already allotted five hours for discussion on the GST bill, according to media reports.
The GST bill, which has been approved by the Lok Sabha is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax. The month-long monsoon session of the parliament will conclude on 12 August 2016.
Index heavyweight and housing finance major HDFC edged higher after the company reported a surge in bottom line in Q1 June 2016 on the back of exceptional gains on sell of a part of its stake in its general insurance joint venture in favour of the joint venture partner. Passenger car major Maruti Suzuki India edged higher after the company announced that it will start sales of its first light commercial vehicle (LCV) Super Carry towards the end of August. Zee Entertainment Enterprises (Zee) edged higher after the company reported strong Q1 results.
Shares of Dr Reddy's Laboratories (DRL) tumbled, with the stock extending losses registered during the previous trading session triggered by weak Q1 June 2016 results. Shares of telecom towers company Bharti Infratel surged after the company reported a surge in bottom line in Q1 June 2016.
The Sensex rose 47.81 points or 0.17% to settle at 28,024.33, its highest closing level since 25 July 2016. The index jumped 234.36 points or 0.83% at the day's high of 28,210.88. The index lost 76.59 points or 0.27% at the day's low of 27,899.93.
The Nifty 50 index rose 25.15 points or 0.29% to settle at 8,615.80, its highest closing level since 25 July 2016. The index rose 74.35 points or 0.86% at the day's high of 8,665. The index lost 18.60 points or 0.22% at the day's low of 8,572.05.
The market breadth indicating the overall health of the market was negative. On BSE, 1,342 shares fell and 1,316 shares rose. A total of 207 shares were unchanged. The BSE Mid-Cap index rose 0.60%. The BSE Small-Cap index rose 0.49%. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 3478 crore, lower than turnover of Rs 4138.75 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE Telecom index (up 1.26%), the S&P BSE Finance index (up 0.93%), the S&P BSE Bankex (up 0.89%), the S&P BSE Basic Materials index (up 0.75%), the S&P BSE Auto index (up 0.71%), the S&P BSE Industrials index (up 0.70%), the S&P BSE Teck index (up 0.61%), the S&P BSE Metal index (up 0.60%), the S&P BSE Capital Goods index (up 0.50%), the S&P BSE Consumer Discretionary Goods & Services index (up 0.41%), the S&P BSE IT index (up 0.39%), the S&P BSE Power index (up 0.19%) and the S&P BSE Oil & Gas index (up 0.17%), outperformed the Sensex. The S&P BSE Utilities index (up 0.05%), the S&P BSE Realty index (down 0.08%), the S&P BSE Consumer Durables index (down 0.23%), the S&P BSE Energy index (down 0.39%), the S&P BSE FMCG index (down 0.51%) and the S&P BSE Healthcare index (down 0.75%), underperformed the Sensex.
Asian Paints rose 0.11% to Rs 1,061.80. On a consolidated basis, the company's net profit after minority interest rose 17.9% to Rs 535 crore on 10.2% increase interest from operations to Rs 4082.10 crore in Q1 June 2016 over Q1 June 2015. Profit before depreciation, interest, and taxes (PBDIT) rose 20.9% to Rs 820.30 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours today, 27 July 2016.
K.B.S. Anand, Managing Director & CEO, Asian Paints said that the decorative business segment India registered double digit growth during the quarter. Lower raw material prices led to improved margins. Industrial business registered good growth in the industrial liquid paints category for the company's joint venture (JV) AP-PPG while the other JV PPG-AP saw good demand in the auto original equipment manufacturers (OEM) and general industrial segment. The company's international business performed well, aided by good growth in markets like Nepal, UAE and Fiji. Both the segments in the home improvement category -- the Kitchen (Sleek) and Bath (ESS ESS) businesses -- delivered good topline growth in the quarter as compared to the previous year.
Index heavyweight Reliance Industries (RIL) fell 1% to Rs 1,013.05. The stock hit a high of Rs 1,026.90 and a low of Rs 1,010 in intraday trade.
Index heavyweight and cigarette major ITC fell 1.51% to Rs 247.75. The stock hit a high of Rs 253.65 and a low of Rs 246.55 in intraday trade.
Index heavyweight and housing finance major HDFC edged higher after the company reported a surge in bottom line in Q1 June 2016 on the back of exceptional gains on sell of a part of its stake in its general insurance joint venture in favour of the joint venture partner. The stock rose 1.48% at Rs 1,387.85. The stock hit a high of Rs 1,398 in intraday trade, which is a 52-week high for the counter. The stock hit a low of Rs 1,371.50 in intraday trade. HDFC's net profit rose 37.45% to Rs 1870.73 crore on 19.4% growth in total income to Rs 8393.33 crore in Q1 June 2016 over Q1 June 2015. HDFC made a pre-tax gain of Rs 921.61 crore in Q1 June 2016 from sale of a part of its stake in HDFC ERGO General Insurance Company to Ergo International AG. Meanwhile, HDFC made an additional one time provision of Rs 275 crore in Q1 June 2016 towards standard assets and other contingencies.
HDFC's loan book increased to Rs 2.65 lakh crore as on 30 June 2016, from Rs 2.31 lakh crore as on 30 June 2015. This is after considering the loans sold during the preceding 12 months amounting to Rs 14011 crore. During the quarter, HDFC sold loans amounting to Rs 5108 crore of which Rs 3296 crore was sold to HDFC Bank and the balance to other banks.
On consolidated basis, HDFC's net profit rose 26.88% to Rs 2796.92 crore on 18.67% growth in total income to Rs 13531.48 crore in Q1 June 2016 over Q1 June 2015.
HDFC's board granted its approval for issuance of secured redeemable non-convertible debentures (NCD) aggregating to Rs 35000 crore on a private placement basis.
Passenger car major Maruti Suzuki India (MSIL) rose 1.64% to Rs 4,558.85 after the company announced that it will start sales of its first light commercial vehicle (LCV) Super Carry towards the end of August. With Super Carry, MSIL marks its entry into the LCV segment. Initially, the vehicle will be sold in three cities viz. Ahmedabad, Kolkata and Ludhiana. It will be retailed through a dedicated commercial sales channel. The vehicle is priced at Rs 4.03 lakh ex-showroom Ahmedabad. The announcement was made during market hours today, 27 July 2016.
The MSIL stock had fallen 1.43% to settle at Rs 4,485.25 yesterday, 26 July 2016 after the company announced disappointing Q1 June 2016 results. The company's net profit rose 23% to Rs 1486.20 crore on 12.1% growth in net sales to Rs 14654.50 crore in Q1 June 2016 over Q1 June 2015. The growth in bottom line was led by a sharp surge in non-operational income and decline in depreciation charge.
Two-wheeler maker Bajaj Auto edged lower after the company reported a minuscule growth in bottom line in Q1 June 2016 over Q1 June 2015. The stock shed 0.05%. The company's net profit rose 2.19% to Rs 978.37 crore on 2.72% increase in total income to Rs 6355.81 crore in Q1 June 2016 over Q1 June 2015. Operating earnings before interest, taxes, depreciation and amortization (EBITDA) rose 3.02% to Rs 1227 crore in Q1 June 2016 over Q1 June 2015. Operating EBITDA margin was reported at 21.2% in Q1 June 2016, slightly higher than 21.1% in Q1 June 2015.
On a consolidated basis, the company's net profit rose 13.77% to Rs 1039.70 crore on 4.22% increase in total income to Rs 6355.84 crore in Q1 June 2016 over Q1 June 2015. The result was announced during trading hours today, 27 July 2016.
Bajaj Auto said in a statement that the company continues to witness headwinds in exports markets viz. Nigeria and Egypt. The company said that its exports have been adversely impacted by external factors viz. non availability of foreign currency and depreciation of the local currency.
Cement major Ambuja Cements edged lower in volatile trade after announcing strong Q2 June 2016 results. The stock fell 0.81% at Rs 267.75. The stock hit a 52-week high of Rs 278.35 in intraday trade. The stock hit a low of Rs 266.25 in intraday trade. The company's net profit rose 77% to Rs 400 crore on 1.9% growth in net sales to Rs 2541 crore in Q2 June 2016 over Q2 June 2015. The result was announced after market hours yesterday, 26 July 2016. The company's operating EBITDA (earnings before interest, taxation, depreciation and amortization) surged 56.5% to Rs 601 crore in Q2 June 2016 over Q2 June 2015.
On future business outlook, Ambuja Cements said that the medium to long term outlook for cement demand remains positive considering above normal monsoon forecast this year and government's focus on housing, concrete roads, smart cities and infrastructure development. Ambuja said it would continue to focus on improving operational efficiencies.
Zee Entertainment Enterprises (Zee) edged higher after the company reported strong Q1 results. The stock rose 2.81% at Rs 487.90. The stock hit a 52-week high of Rs 493.65 in intraday trade. The stock hit a low of Rs 476.10 in intraday trade. Zee's consolidated net profit rose 21.76% to Rs 216.96 crore on 14.74% increase in total income to Rs 1531.80 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 26 July 2016.
Advertising revenue rose 19.2% to Rs 912 crore in Q1 June 2016 over Q1 June 2015. Subscription revenue rose 14.2% to Rs 528.20 crore in Q1 June 2016 over Q1 June 2015. Earnings before interest, taxes, depreciation and amortization (EBITDA) jumped 44.1% to Rs 453.20 crore in Q1 June 2016 over Q1 June 2015. EBITDA margin rose sharply to 28.83% in Q1 June 2016 from 23.71% in Q1 June 2015.
Shares of telecom towers company Bharti Infratel surged after the company reported a surge in bottom line in Q1 June 2016. The stock rose 5.10% to Rs 380.90. The company's consolidated net profit rose 71% to Rs 756 crore on 7% growth in revenue to Rs 3211 crore in Q1 June 2016 over Q1 June 2015. Earnings before interest, taxation, depreciation and amortization (EBITDA) rose 9% to Rs 1408 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 26 July 2016.
Bharti Infratel's Chairman Akhil Gupta said that the government's initiative on smart city would provide opportunities to infrastructure companies like Bharti Infratel. Bharti Infratel and Indus Towers are fully geared to serve their customers' demand and to look at the new opportunities coming up on the infrastructure front, Gupta said.
During the quarter, the company has taken approval of shareholders on the buyback of its equity shares for an issue size of Rs 2000 crore and is in the midst of completing the buyback process.
Bharti Infratel is a telecom tower arm of Bharti Airtel.
Shares of Dr Reddy's Laboratories (DRL) tumbled, with the stock extending losses registered during the previous trading session triggered by weak Q1 June 2016 results. The stock fell 10.07% at Rs 2,988.40. The stock had fallen 4.37% to settle at Rs 3,322.85 yesterday, 26 July 2016. DRL's consolidated net profit fell 76.28% to Rs 153.50 crore on 14.06% decline in total income to Rs 3289.50 crore in Q1 June 2016 over Q1 June 2015. Meanwhile, a domestic brokerage has reportedly downgraded the DRL stock to ''sell'' from ''reduce'' and cut its price target to Rs 2,500 from Rs 3,100 stating that the company's US business would face headwinds from double-digit price erosion on base business.
Bank stocks were mixed. Among public sector banks, IDBI Bank (down 2.18%), Syndicate Bank (down 1.56%), United Bank of India (down 0.65%), Bank of Maharashtra (down 0.6%), Corporation Bank (down 0.59%), Allahabad Bank (down 0.51%), Central Bank of India (down 0.46%), Dena Bank (down 0.26%), Vijaya Bank (down 0.24%), UCO Bank (down 0.12%) and Punjab and Sind Bank (down 0.1%), edged lower. Bank of Baroda (up 0.32%), Indian Bank (up 0.49%), Union Bank of India (up 0.66%), State Bank of India (up 0.95%), Canara Bank (up 1.32%), Bank of India (up 1.49%) and Punjab National Bank (up 2.55%), edged higher.
Reserve Bank of India (RBI) Governor Raghuram Rajan yesterday, 26 July 2016, said that a clean-up of the balance sheet of public sector banks is underway and needs to be taken to its logical conclusion. Rajan was speaking at the 10th Statistics Day Conference 2016 in Mumbai.
Among private sector banks, ICICI Bank (up 3%), IndusInd Bank (up 2.14%), City Union Bank (up 2.09%), Federal Bank (up 1.01%) and Kotak Mahindra Bank (up 0.57%), edged higher. HDFC Bank (down 0.14%) and Axis Bank (down 0.9%), edged lower.
Yes Bank ended almost unchanged at Rs 1,200.10 on BSE after the private sector bank reported first quarter results. The stock hit a high of Rs 1,214 in intraday trade, which is a record high for the counter. The stock hit a low of Rs 1,176.25 in intraday trade. The bank's net profit rose 32.76% to Rs 731.80 crore on 25.43% growth in total income to Rs 4762.83 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours today, 27 July 2016.
The bank's net interest income (NII) rose 24.2% to Rs 1316.60 crore in Q1 June 2016 over Q1 June 2015. Net interest margin (NIM) expanded to 3.4% in Q1 June 2016 from 3.3% in Q1 June 2015. The bank's provisions and contingencies jumped 110.93% to Rs 206.63 crore in Q1 June 2016 over Q1 June 2015.
The private sector bank said that it continues to show resilience on all asset quality parameters. Yes Bank said that the bank continues to witness a robust CASA (current and savings account) growth, with the CASA ratio improving to 29.6% as on 30 June 2016 from 23.4% as on 30 June 2015. Yes Bank Managing Director & CEO Rana Kapoor said in a statement that given the improving macroeconomic environment along with stable asset quality and accelerating retail franchise, Yes Bank is well poised to capture market share across retail and corporate segments at an enhanced pace.
Separately, Yes Bank announced before market hours today, 27 July 2016, that it has received an in-principle approval from the Securities & Exchange Board of India (Sebi) to sponsor a mutual fund and set up an asset management company (AMC) and a trustee company. The bank said it has already identified senior leadership and technology architecture to establish this business, and will commence operations within 12 months.
The Sensex has risen 1,024.61 points or 3.79% in this month so far (till 27 July 2016). The Sensex has risen 1,906.79 points or 7.3% in calendar year 2016 so far (till 27 July 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 5,529.72 points or 24.58%. The Sensex is off 393.26 points or 1.38% from a 52-week high of 28,417.59 hit on 10 August 2015. The Sensex is off 2,000.41 points or 6.66% from a record high of 30,024.74 hit on 4 March 2015.
In overseas stock markets, Asian and European stocks edged higher after media reports suggested that Japanese Prime Minister Shinzo Abe plans to introduce an economic stimulus plan worth more than 28 trillion yen next week. In Japan, the Nikkei 225 Average ended 1.72% higher. In addition to fiscal stimulus from the government, global investors are hoping for further easing of monetary policy from the Bank of Japan (BOJ) after the conclusion of a two-day monetary policy meeting on 28-29 July 2016. Strength in the yen against the dollar post last month's Brexit vote and data showing a slowdown in the Japanese economy have triggered expectations of further easing of monetary policy from the BOJ. A stronger yen hurts the competitiveness of Japanese exporters.
Most US stocks edged higher in a lacklustre trading session yesterday, 26 July 2016. Investors were reluctant to carve out big positions ahead of the monetary policy outcome from the Federal Reserve. The Federal Open Market Committee (FOMC) is widely expected to keep the benchmark fed funds rates unchanged after the conclusion of two-day monetary policy today, 27 July 2016. Market participant will scrutinize the Fed statement for clues on policy direction. It remains to be seen whether the Fed gives any signals on the possibility of a rate hike at its next policy meeting in September 2016. The Fed has kept the benchmark fed funds rate unchanged after raising it for the first time in nearly a decade in December 2015.
According to reports, the empowered committee of state finance ministers which met Finance Minister Arun Jaitley yesterday, 26 July 2016, has reached a consensus on key aspects of the constitutional amendment bill on Goods and Services Tax (GST). The committee has decided to keep the main GST rate low, according to reports. The GST bill is likely to be moved in the Rajya Sabha next week. The Rajya Sabha has already allotted five hours for discussion on the GST bill, according to media reports.
The GST bill, which has been approved by the Lok Sabha is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax. The month-long monsoon session of the parliament will conclude on 12 August 2016.
Index heavyweight and housing finance major HDFC edged higher after the company reported a surge in bottom line in Q1 June 2016 on the back of exceptional gains on sell of a part of its stake in its general insurance joint venture in favour of the joint venture partner. Passenger car major Maruti Suzuki India edged higher after the company announced that it will start sales of its first light commercial vehicle (LCV) Super Carry towards the end of August. Zee Entertainment Enterprises (Zee) edged higher after the company reported strong Q1 results.
Shares of Dr Reddy's Laboratories (DRL) tumbled, with the stock extending losses registered during the previous trading session triggered by weak Q1 June 2016 results. Shares of telecom towers company Bharti Infratel surged after the company reported a surge in bottom line in Q1 June 2016.
The Sensex rose 47.81 points or 0.17% to settle at 28,024.33, its highest closing level since 25 July 2016. The index jumped 234.36 points or 0.83% at the day's high of 28,210.88. The index lost 76.59 points or 0.27% at the day's low of 27,899.93.
The Nifty 50 index rose 25.15 points or 0.29% to settle at 8,615.80, its highest closing level since 25 July 2016. The index rose 74.35 points or 0.86% at the day's high of 8,665. The index lost 18.60 points or 0.22% at the day's low of 8,572.05.
The market breadth indicating the overall health of the market was negative. On BSE, 1,342 shares fell and 1,316 shares rose. A total of 207 shares were unchanged. The BSE Mid-Cap index rose 0.60%. The BSE Small-Cap index rose 0.49%. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 3478 crore, lower than turnover of Rs 4138.75 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE Telecom index (up 1.26%), the S&P BSE Finance index (up 0.93%), the S&P BSE Bankex (up 0.89%), the S&P BSE Basic Materials index (up 0.75%), the S&P BSE Auto index (up 0.71%), the S&P BSE Industrials index (up 0.70%), the S&P BSE Teck index (up 0.61%), the S&P BSE Metal index (up 0.60%), the S&P BSE Capital Goods index (up 0.50%), the S&P BSE Consumer Discretionary Goods & Services index (up 0.41%), the S&P BSE IT index (up 0.39%), the S&P BSE Power index (up 0.19%) and the S&P BSE Oil & Gas index (up 0.17%), outperformed the Sensex. The S&P BSE Utilities index (up 0.05%), the S&P BSE Realty index (down 0.08%), the S&P BSE Consumer Durables index (down 0.23%), the S&P BSE Energy index (down 0.39%), the S&P BSE FMCG index (down 0.51%) and the S&P BSE Healthcare index (down 0.75%), underperformed the Sensex.
Asian Paints rose 0.11% to Rs 1,061.80. On a consolidated basis, the company's net profit after minority interest rose 17.9% to Rs 535 crore on 10.2% increase interest from operations to Rs 4082.10 crore in Q1 June 2016 over Q1 June 2015. Profit before depreciation, interest, and taxes (PBDIT) rose 20.9% to Rs 820.30 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours today, 27 July 2016.
K.B.S. Anand, Managing Director & CEO, Asian Paints said that the decorative business segment India registered double digit growth during the quarter. Lower raw material prices led to improved margins. Industrial business registered good growth in the industrial liquid paints category for the company's joint venture (JV) AP-PPG while the other JV PPG-AP saw good demand in the auto original equipment manufacturers (OEM) and general industrial segment. The company's international business performed well, aided by good growth in markets like Nepal, UAE and Fiji. Both the segments in the home improvement category -- the Kitchen (Sleek) and Bath (ESS ESS) businesses -- delivered good topline growth in the quarter as compared to the previous year.
Index heavyweight Reliance Industries (RIL) fell 1% to Rs 1,013.05. The stock hit a high of Rs 1,026.90 and a low of Rs 1,010 in intraday trade.
Index heavyweight and cigarette major ITC fell 1.51% to Rs 247.75. The stock hit a high of Rs 253.65 and a low of Rs 246.55 in intraday trade.
Index heavyweight and housing finance major HDFC edged higher after the company reported a surge in bottom line in Q1 June 2016 on the back of exceptional gains on sell of a part of its stake in its general insurance joint venture in favour of the joint venture partner. The stock rose 1.48% at Rs 1,387.85. The stock hit a high of Rs 1,398 in intraday trade, which is a 52-week high for the counter. The stock hit a low of Rs 1,371.50 in intraday trade. HDFC's net profit rose 37.45% to Rs 1870.73 crore on 19.4% growth in total income to Rs 8393.33 crore in Q1 June 2016 over Q1 June 2015. HDFC made a pre-tax gain of Rs 921.61 crore in Q1 June 2016 from sale of a part of its stake in HDFC ERGO General Insurance Company to Ergo International AG. Meanwhile, HDFC made an additional one time provision of Rs 275 crore in Q1 June 2016 towards standard assets and other contingencies.
HDFC's loan book increased to Rs 2.65 lakh crore as on 30 June 2016, from Rs 2.31 lakh crore as on 30 June 2015. This is after considering the loans sold during the preceding 12 months amounting to Rs 14011 crore. During the quarter, HDFC sold loans amounting to Rs 5108 crore of which Rs 3296 crore was sold to HDFC Bank and the balance to other banks.
On consolidated basis, HDFC's net profit rose 26.88% to Rs 2796.92 crore on 18.67% growth in total income to Rs 13531.48 crore in Q1 June 2016 over Q1 June 2015.
HDFC's board granted its approval for issuance of secured redeemable non-convertible debentures (NCD) aggregating to Rs 35000 crore on a private placement basis.
Passenger car major Maruti Suzuki India (MSIL) rose 1.64% to Rs 4,558.85 after the company announced that it will start sales of its first light commercial vehicle (LCV) Super Carry towards the end of August. With Super Carry, MSIL marks its entry into the LCV segment. Initially, the vehicle will be sold in three cities viz. Ahmedabad, Kolkata and Ludhiana. It will be retailed through a dedicated commercial sales channel. The vehicle is priced at Rs 4.03 lakh ex-showroom Ahmedabad. The announcement was made during market hours today, 27 July 2016.
The MSIL stock had fallen 1.43% to settle at Rs 4,485.25 yesterday, 26 July 2016 after the company announced disappointing Q1 June 2016 results. The company's net profit rose 23% to Rs 1486.20 crore on 12.1% growth in net sales to Rs 14654.50 crore in Q1 June 2016 over Q1 June 2015. The growth in bottom line was led by a sharp surge in non-operational income and decline in depreciation charge.
Two-wheeler maker Bajaj Auto edged lower after the company reported a minuscule growth in bottom line in Q1 June 2016 over Q1 June 2015. The stock shed 0.05%. The company's net profit rose 2.19% to Rs 978.37 crore on 2.72% increase in total income to Rs 6355.81 crore in Q1 June 2016 over Q1 June 2015. Operating earnings before interest, taxes, depreciation and amortization (EBITDA) rose 3.02% to Rs 1227 crore in Q1 June 2016 over Q1 June 2015. Operating EBITDA margin was reported at 21.2% in Q1 June 2016, slightly higher than 21.1% in Q1 June 2015.
On a consolidated basis, the company's net profit rose 13.77% to Rs 1039.70 crore on 4.22% increase in total income to Rs 6355.84 crore in Q1 June 2016 over Q1 June 2015. The result was announced during trading hours today, 27 July 2016.
Bajaj Auto said in a statement that the company continues to witness headwinds in exports markets viz. Nigeria and Egypt. The company said that its exports have been adversely impacted by external factors viz. non availability of foreign currency and depreciation of the local currency.
Cement major Ambuja Cements edged lower in volatile trade after announcing strong Q2 June 2016 results. The stock fell 0.81% at Rs 267.75. The stock hit a 52-week high of Rs 278.35 in intraday trade. The stock hit a low of Rs 266.25 in intraday trade. The company's net profit rose 77% to Rs 400 crore on 1.9% growth in net sales to Rs 2541 crore in Q2 June 2016 over Q2 June 2015. The result was announced after market hours yesterday, 26 July 2016. The company's operating EBITDA (earnings before interest, taxation, depreciation and amortization) surged 56.5% to Rs 601 crore in Q2 June 2016 over Q2 June 2015.
On future business outlook, Ambuja Cements said that the medium to long term outlook for cement demand remains positive considering above normal monsoon forecast this year and government's focus on housing, concrete roads, smart cities and infrastructure development. Ambuja said it would continue to focus on improving operational efficiencies.
Zee Entertainment Enterprises (Zee) edged higher after the company reported strong Q1 results. The stock rose 2.81% at Rs 487.90. The stock hit a 52-week high of Rs 493.65 in intraday trade. The stock hit a low of Rs 476.10 in intraday trade. Zee's consolidated net profit rose 21.76% to Rs 216.96 crore on 14.74% increase in total income to Rs 1531.80 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 26 July 2016.
Advertising revenue rose 19.2% to Rs 912 crore in Q1 June 2016 over Q1 June 2015. Subscription revenue rose 14.2% to Rs 528.20 crore in Q1 June 2016 over Q1 June 2015. Earnings before interest, taxes, depreciation and amortization (EBITDA) jumped 44.1% to Rs 453.20 crore in Q1 June 2016 over Q1 June 2015. EBITDA margin rose sharply to 28.83% in Q1 June 2016 from 23.71% in Q1 June 2015.
Shares of telecom towers company Bharti Infratel surged after the company reported a surge in bottom line in Q1 June 2016. The stock rose 5.10% to Rs 380.90. The company's consolidated net profit rose 71% to Rs 756 crore on 7% growth in revenue to Rs 3211 crore in Q1 June 2016 over Q1 June 2015. Earnings before interest, taxation, depreciation and amortization (EBITDA) rose 9% to Rs 1408 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours yesterday, 26 July 2016.
Bharti Infratel's Chairman Akhil Gupta said that the government's initiative on smart city would provide opportunities to infrastructure companies like Bharti Infratel. Bharti Infratel and Indus Towers are fully geared to serve their customers' demand and to look at the new opportunities coming up on the infrastructure front, Gupta said.
During the quarter, the company has taken approval of shareholders on the buyback of its equity shares for an issue size of Rs 2000 crore and is in the midst of completing the buyback process.
Bharti Infratel is a telecom tower arm of Bharti Airtel.
Shares of Dr Reddy's Laboratories (DRL) tumbled, with the stock extending losses registered during the previous trading session triggered by weak Q1 June 2016 results. The stock fell 10.07% at Rs 2,988.40. The stock had fallen 4.37% to settle at Rs 3,322.85 yesterday, 26 July 2016. DRL's consolidated net profit fell 76.28% to Rs 153.50 crore on 14.06% decline in total income to Rs 3289.50 crore in Q1 June 2016 over Q1 June 2015. Meanwhile, a domestic brokerage has reportedly downgraded the DRL stock to ''sell'' from ''reduce'' and cut its price target to Rs 2,500 from Rs 3,100 stating that the company's US business would face headwinds from double-digit price erosion on base business.
Bank stocks were mixed. Among public sector banks, IDBI Bank (down 2.18%), Syndicate Bank (down 1.56%), United Bank of India (down 0.65%), Bank of Maharashtra (down 0.6%), Corporation Bank (down 0.59%), Allahabad Bank (down 0.51%), Central Bank of India (down 0.46%), Dena Bank (down 0.26%), Vijaya Bank (down 0.24%), UCO Bank (down 0.12%) and Punjab and Sind Bank (down 0.1%), edged lower. Bank of Baroda (up 0.32%), Indian Bank (up 0.49%), Union Bank of India (up 0.66%), State Bank of India (up 0.95%), Canara Bank (up 1.32%), Bank of India (up 1.49%) and Punjab National Bank (up 2.55%), edged higher.
Reserve Bank of India (RBI) Governor Raghuram Rajan yesterday, 26 July 2016, said that a clean-up of the balance sheet of public sector banks is underway and needs to be taken to its logical conclusion. Rajan was speaking at the 10th Statistics Day Conference 2016 in Mumbai.
Among private sector banks, ICICI Bank (up 3%), IndusInd Bank (up 2.14%), City Union Bank (up 2.09%), Federal Bank (up 1.01%) and Kotak Mahindra Bank (up 0.57%), edged higher. HDFC Bank (down 0.14%) and Axis Bank (down 0.9%), edged lower.
Yes Bank ended almost unchanged at Rs 1,200.10 on BSE after the private sector bank reported first quarter results. The stock hit a high of Rs 1,214 in intraday trade, which is a record high for the counter. The stock hit a low of Rs 1,176.25 in intraday trade. The bank's net profit rose 32.76% to Rs 731.80 crore on 25.43% growth in total income to Rs 4762.83 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours today, 27 July 2016.
The bank's net interest income (NII) rose 24.2% to Rs 1316.60 crore in Q1 June 2016 over Q1 June 2015. Net interest margin (NIM) expanded to 3.4% in Q1 June 2016 from 3.3% in Q1 June 2015. The bank's provisions and contingencies jumped 110.93% to Rs 206.63 crore in Q1 June 2016 over Q1 June 2015.
The private sector bank said that it continues to show resilience on all asset quality parameters. Yes Bank said that the bank continues to witness a robust CASA (current and savings account) growth, with the CASA ratio improving to 29.6% as on 30 June 2016 from 23.4% as on 30 June 2015. Yes Bank Managing Director & CEO Rana Kapoor said in a statement that given the improving macroeconomic environment along with stable asset quality and accelerating retail franchise, Yes Bank is well poised to capture market share across retail and corporate segments at an enhanced pace.
Separately, Yes Bank announced before market hours today, 27 July 2016, that it has received an in-principle approval from the Securities & Exchange Board of India (Sebi) to sponsor a mutual fund and set up an asset management company (AMC) and a trustee company. The bank said it has already identified senior leadership and technology architecture to establish this business, and will commence operations within 12 months.
The Sensex has risen 1,024.61 points or 3.79% in this month so far (till 27 July 2016). The Sensex has risen 1,906.79 points or 7.3% in calendar year 2016 so far (till 27 July 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 5,529.72 points or 24.58%. The Sensex is off 393.26 points or 1.38% from a 52-week high of 28,417.59 hit on 10 August 2015. The Sensex is off 2,000.41 points or 6.66% from a record high of 30,024.74 hit on 4 March 2015.
In overseas stock markets, Asian and European stocks edged higher after media reports suggested that Japanese Prime Minister Shinzo Abe plans to introduce an economic stimulus plan worth more than 28 trillion yen next week. In Japan, the Nikkei 225 Average ended 1.72% higher. In addition to fiscal stimulus from the government, global investors are hoping for further easing of monetary policy from the Bank of Japan (BOJ) after the conclusion of a two-day monetary policy meeting on 28-29 July 2016. Strength in the yen against the dollar post last month's Brexit vote and data showing a slowdown in the Japanese economy have triggered expectations of further easing of monetary policy from the BOJ. A stronger yen hurts the competitiveness of Japanese exporters.
Most US stocks edged higher in a lacklustre trading session yesterday, 26 July 2016. Investors were reluctant to carve out big positions ahead of the monetary policy outcome from the Federal Reserve. The Federal Open Market Committee (FOMC) is widely expected to keep the benchmark fed funds rates unchanged after the conclusion of two-day monetary policy today, 27 July 2016. Market participant will scrutinize the Fed statement for clues on policy direction. It remains to be seen whether the Fed gives any signals on the possibility of a rate hike at its next policy meeting in September 2016. The Fed has kept the benchmark fed funds rate unchanged after raising it for the first time in nearly a decade in December 2015.
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