Sensex, Nifty Halt Three-Day Winning Streak Dragged By Banks

Indian equity benchmarks snapped their three-day winning streak dragged by financial heavyweights like ICICI Bank, State Bank of India, HDFC and Kotak Mahindra Bank.

The S&P BSE Sensex fell 0.61 percent or 216 points to 34,949 and the NSE Nifty 50 index declined 0.52 percent or 55 points to 10,633.

Eleven out of 19 sector gauges compiled by BSE ended lower led by the S&P BSE Bankex index's 1.6 percent drop. On the other hand, the S&P BSE Oil & Gas index was the top gainer, up 0.5 percent.

The mid- and small-cap shares ended in line with their larger peers as the S&P BSE MidCap index fell 0.44 percent and the S&P BSE SmallCap index declined 0.26 percent.

Shares of the government-owned coal miner fell as much as 2.91 percent to Rs 276 after its profit missed Bloomberg consensus estimates in March quarter.

Key earnings highlights:

• Net profit down 52 percent at Rs 1,295.22 crore versus Rs 2,718.75 crore (YoY); Estimate of Rs 4,341 crore
• Revenues up 8.3 percent at Rs 26,909 crore versus Rs 24,851 crore (YoY); Estimate of Rs 23,243 crore
• Ebitda at Rs 195.5 crore versus Rs 5,069 crore (YoY)
• Margin at 0.72 percent versus 21.80 percent
• Employee cost at Rs 16,653.86 crore that is 62 percent of the revenue

Caplin Point Labs: The Chennai-based drugmaker fell 9 percent to Rs 541.40. Trading volume was 25.3 times its 20-day average.

Vardhman Textiles: The Ludhiana-based textile manufacturer fell 0.5 percent to Rs 1,247. trading volume was 32.2 times its 20-day average.

General Insurance Corporation: The Mumbai-based general insurer rose 3 percent to Rs 750. Trading volume was 6.2 times its 20-day average.

ITDC: The Delhi-based state-run tourism service provider rose 7 percent to Rs 429. Trading volume was 5.2 times its 20-day average.

BHEL: The Delhi-based heavy electrical equipment maker rose over 5 percent to Rs 83.30 after its profit met Bloomberg consensus estimates in March quarter.

Key earnings highlights:

• Net profit up 2.12 times at Rs 457 crore versus Rs 215.5 crore (YoY); Estimate of Rs 462 crore
• Revenue up 3.7 percent at Rs 10,140 crore versus Rs 9,779 crore (YoY); Estimate of Rs 10,550 crore
• Margin at 12.1 percent versus 5.8 percent (YoY)
• EBITDA up 2.3 times at Rs 1,231.5 crore versus Rs 568.7 crore (YoY)

Reliance Communications: The Anil Ambani-led telecom operator rose as much as 9.80 percent to Rs 16.80 after it informed NCLAT that it has reached an agreement settlement with minority shareholders.

Vista Pharma: The Hyderabad-based drugmaker was locked in a 10 percent upper circuit at Rs 36.90 after it signed an agreement to acquire a complex ANDA for Uro Care. The U.S. market for this brand is $1.3 billion as per the latest IMS data.

ITDC: The Delhi-based state-run tourism service provider rose 7 percent to Rs 429. Trading volume was 5.2 times its 20-day average.

Shares of the country's largest utility vehicle maker rose as much as 2 percent to Rs 868 after it reported March quarter earnings.

Key earnings highlights of M&M and Mahindra Vehicle Manufacturers combined:

• Combined net profit rose 50 percent to Rs 1,155 crore versus Rs 770 crore (YoY)
• Combined revenue up 25.6 percent at Rs 13,189 crore versus Rs 10,499 crore (YoY)
• Ebitda at Rs 1,995 crore versus Rs 1,171 crore (YoY)
• Margin at 15.1 percent versus 11.2 percent (YoY)

The NSE Nifty Auto Index, the third worst performer among sectoral gauges so far this month, is set for its poorest May in six years.

Indian equity benchmarks extended losses dragged by banking heavyweights like ICICI Bank, State Bank of India, Yes Bank and Kotak Mahindra Bank.

The S&P BSE Sensex fell 0.37 percent or 128 points to 35,038 and the NSE Nifty 50 index declined 0.33 percent or 35 points to 10,653.

Eleven out of 19 sector gauges compiled by BSE were trading lower led by the S&P BSE Bankex index's 1.2 percent drop. On the flipside, the S&P BSE Industrials index was the top gainer, up 0.6 percent.

The overall market breadth was negative as 1,318 shares were declining while 1,170 were advancing on the BSE.

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• ITC has 25 lakh shares change hands in two blocks. Stock was up 0.07 percent at Rs 275.50.

Buyers and sellers were not immediately known

Source: Bloomberg

• Shares of sugar manufacturers rallied for second day in an other wise weak session.
• Sakthi Sugars was among the top gainer in the pack, stock rose 9 percent to Rs 16.35.

Shares of the Hyderabad-based drugmaker came off day's low after it informed exchanges that it has secured patents.

Suven Life Sciences has secured one product patent in New Zealand and one in U.S. for New Chemical Entities (NCE) for the treatment of disorders associated with neurodegenerative diseases.

The stock was down 1.3 percent at Rs 194. Earlier in the day, it fell as much as 1.7 percent to Rs 193.

• City Union Bank had 10 lakh shares changed hands in a block deal. Stock down 0.3 percent at Rs 182.50.

Buyers and sellers were not immediately known

Source: Bloomberg

Shares of the Delhi-based heavy electrical equipment maker rose over 5 percent to Rs 83.30 after its profit met Bloomberg consensus estimates in March quarter.

Key earnings highlights:

• Net profit up 2.12 times at Rs 457 crore versus Rs 215.5 crore (YoY); Estimate of Rs 462 crore
• Revenue up 3.7 percent at Rs 10,140 crore versus Rs 9,779 crore (YoY); Estimate of Rs 10,550 crore
• Margin at 12.1 percent versus 5.8 percent (YoY)
• EBITDA up 2.3 times at Rs 1,231.5 crore versus Rs 568.7 crore (YoY)

Shares of the Mumbai-based travel company fell as much as 8.12 percent to Rs 198.65 after its profit declined in March quarter.

Key earnings highlights:

• Revenue up 10 percent at Rs 550.30 crore versus Rs 499.25 crore (YoY)
• Net profit fell 73 percent to Rs 5.5 crore versus Rs 20.04 crore (YoY)

Shares of the Anil Ambani-led telecom operator rose as much as 9.80 percent to Rs 16.80.

The company informed National Companies Law Appellate Tribunal (NCLAT) that it has reached an agreement settlement with minority shareholders.

The company will file terms of settlement shortly with NCLAT.

Shares of the Tamil Nadu-based power generation company fell after its profit declined in March quarter.

Key earnings highlights:

• Revenue down 10.3 percent at Rs 2,542.9 crore
• Net profit down 84 percent at Rs 381.3 crore
• Ebitda down 47 percent at Rs 878.8 crore
• Margin at 34.6 percent

Shares of the Mumbai-based real estate developer fell as much as 9.3 percent to Rs 48.80 after it reported loss in March quarter.

Key earnings highlights:

• Net loss at Rs 82.34 crore versus profit of Rs 43 crore (YoY)
• Revenues at Rs 24.99 lakhs versus Rs 12.68 crore (YoY)

Shares of the Bengaluru-based drugmaker pared losses after it clarified that rumours surrounding resignation of statutory auditors of the company are malicious and unfounded.

The stock was down 1 percent at Rs 418.85. Earlier in the day it fell as much as 9.51 percent to intraday low of Rs 383.10.

• ONGC had 10 lakh shares changed hands in a block. Stock up 0.4 percent at Rs 176.

Buyers and sellers were not immediately known

Source: Bloomberg

Nifty 10,700 strike price call option was among the most active option contracts on the National Stock Exchange.

Premium on the contract fell 30 percent to Rs 23.70. Over 8 lakh shares were added to the open interest which stood at 41.41 lakh shares.

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Shares of the Vadodara-based fruit juice maker were locked in a 20 percent lower circuit for second day in a row at Rs 275.40 after its auditor resigned ahead of earnings.

The auditor of Manpasand Beverages resigned because the maker of juices didn’t share “significant information” sought by Deloitte Haskins & Sells for auditing its financial statements.

The company didn’t disclose that when it informed the exchanges about its auditor’s decision to quit just four days before the board was to approve results for the quarter ended March. In a separate statement, the maker of Mango Sip even called it “coincidental” and a “minor hiccup”. But Deloitte Haskins & Sells’ filing to the Registrar of Companies reveals the actual reason.

Shares of the Kakinada-based shrimp producer rose as much as 15 percent to Rs 680 after its profit jumped over two times in March quarter.

Key earnings highlights:

• Revenue up 23.8 percent at Rs 203.1 crore
• Net profit rose 2.5 times to Rs 17.5 crore
• Ebitda stood at Rs 24.9 crore
• Margin at 12.3 percent

Shares of the Delhi-based flexible packaging company rose as much as 12.68 percent, the most in over 33 months, to Rs 322.50 after it reported March quarter earnings.

Key earnings highlights:

• Revenues up 15 percent at Rs 1,907.90 crore versus Rs 1,660.99 crore (YoY)
• Net profit down 28 percent at Rs 71.13 crore versus Rs 98.19 crore (YoY)

Over next 12 months there is nothing much to expect from markets, Shiv Puri founder and managing director of TVF Capital Advisors told BloombergQuint in an interview.

Key conversation highlights:

• Very difficult to pinpoint valuations of companies that have uncertain future
• Pockets that will be rapidly hurt are very few like solar and related companies
• Seeing healthy earnings growth in India
• Picking up individual stocks is key in this kind of market
• Saw macros worsening globally, micros in India improving this year
• Seeing disruption in the media space with JIO, expect advertisements to shift to digital
• Thermal assets would not be economically viable given the costs of solar power projects

Shares of the country's largest infrastructure developer rose as much as 3.52 percent, the most in over three months, to Rs 1,424.95 after its profit beat Bloomberg consensus estimates in March quarter.

Key earnings highlights:

• Revenue up 11 percent at Rs 40,678 crore.
• Net profit up 5 percent at Rs 3,167 crore versus estimate of Rs 2,995 crore.
• Ebitda up 23 percent at Rs 5,390 crore.
• Margin at 13.2 percent from 11.9 percent.

The company expects a 12-15 percent increase in revenue and 10-12 percent increase in order inflows in the current financial year, Shankar Raman, Whole-Time Director & CFO, L&T said in a press briefing.

Shares of the Anil Aggarwal-led metals conglomerate fell as much as much as 6.21 percent to Rs 237.90, also its lowest level in over 11 months.

Tamil Nadu government ordered the state pollution control board to seal and “permanently” close the Vedanta Group’s copper plant in Tuticorin after last week’s violent protests saw 13 people killed in police firing.

At least 13 people were killed, and several injured in police firing as the months-long protests in Tuticorin against the closure of Vedanta’s Sterlite Copper unit turned violent last week.

Indian equity benchmarks edged lower dragged by HDFC, ICICI Bank, State Bank of India and Vedanta. However, the losses were capped as IT heavyweights Infosys and TCS witnessed buying interest.

The S&P BSE Sensex fell 0.13 percent or 50 points to 35,115 and the NSE Nifty 50 index declined 0.15 percent or 16 points to 10,671.

Nine out of 11 sector gauges compiled by the National Stock Exchange were trading lower led by the Nifty PSU Bank index’s 1.15 percent drop. On the flipside, the Nifty IT index was the top gainer, up 0.9 percent.

The mid- and small-cap shares also edged lower as the S&P BSE MidCap index fell 0.3 percent and the S&P BSE SmallCap index declined 0.1 percent.

• Rupee opened lower at 67.70 per U.S. dollar against yesterday's close of 67.43.

State-run oil marketers hiked petrol and diesel prices for the sixteenth day in a row.

The price of petrol was hiked by 16 paise today to Rs 78.43 per litre in Delhi while diesel was raised by 14 paise a litre to Rs 69.31.

Who’s Meeting Whom

• Crisil to meet Rondure Global and Grandeur Peak Global on May 29.
• Shriram Transport Finance to meet Wellington Management and others between May 29-31 in the U.S.
• BSE to meet ICICI Prudential Mutual Fund on May 29.
• Just Dial to meet Bajaj Alliance Life Insurance on May 29.

Insider Trades

• Dr. Reddy’s Lab promoter and director GV Prasad acquired 56,000 shares on May 25.
• Bajaj Holdings and Investment promoters buy 6,48,000 shares from May 22 - 23.

(As reported on May 28)

Bulk Deals

KSK Energy Ventures

• Oriental Bank of Commerce sold 35 lakh shares at Rs 3.9 each.

Advanced Enzyme Tech

• HDFC Mutual Fund bought 15 lakh shares at Rs 222 each.
• Chandrakanth Rathi Innovations & Projects sold 17 lakh shares at Rs 222 each.

F&O Cues

• Nifty May Futures closed trading at 10,678.8; a discount of 9.7 points versus 2.6 points on Friday.
• Nifty June Futures closed at 10,691; a premium of 2.4 points.
• Nifty rollover at 17 percent, Bank Nifty rollover at 17 percent.
• All series-Nifty open interest up 2 percent and Bank Nifty open interest down 3 percent.
• India VIX ended at 13, up 3.2 percent.
• Maximum open interest for May series at 10,800 Call, open interest at 50.3 lakh, open interest down 5 percent.
• Maximum open interest for May series at 10,500 Put, open interest at 61.8 lakh, open interest down 8 percent.

Active Stock Futures

• BPCL
• Coal India
• M&M
• Power Grid

Other Earnings To Watch

• BEL
• BHEL
• Dilip Buildcon
• Dish TV
• Glenmark Pharma
• Godfrey Philips
• Ipca Labs
• Torrent Power

Earnings Reactions To Watch

L&T (Q4, YoY)

• Revenue up 11 percent at Rs 40,678 crore.
• Net profit up 5 percent at Rs 3,167 crore.
• Ebitda up 23 percent at Rs 5,390 crore.
• Margin at 13.2 percent from 11.9 percent.

Lumax Industries (Q4, YoY)

• Revenue up 45 percent at Rs 559 crore.
• Net profit rose to Rs 17.7 crore.
• Ebitda up 81.6 percent at Rs 46.5 crore.
• Margin at 8.3 percent.
• Deferred tax credit amounting to Rs 6.7 crore.

Finolex Cables (Q4, YoY)

• Revenue up 12.2 percent at Rs 796 crore.
• Net profit up 8.3 percent at Rs 81.8 crore.
• Ebitda up 14.3 percent at Rs 115.4 crore.
• Margin at 14.5 percent.

Apex Frozen Foods (Q4, YoY)

• Revenue up 23.8 percent at Rs 203.1 crore.
• Net profit rose to Rs 17.5 crore.
• Ebitda stood at Rs 24.9 crore.
• Margin at 12.3 percent.

Minda Corporation (Q4, YoY)

• Revenue up 39.9 percent at Rs 720.5 crore.
• Net profit up 2.35 times at Rs 38.7 crore.
• Ebitda up 2.13 times at Rs 81.8 crore.
• Margin at 11.4 percent.

MM Forgings (Q4, YoY)

• Revenue up 65.6 percent at Rs 199.5 crore.
• Net profit rose to Rs 27.4 crore.
• Ebitda up 63.6 percent at Rs 38.6 crore.
• Margin at 19.3 percent.

NMDC (Q4, YoY)

• Revenue up 35.2 percent at Rs 3,883 crore.
• Net profit up 2.2 times at Rs 1,105.9 crore.
• Ebitda up 104 percent at Rs 1,901 crore.
• Margin at 49 percent versus 32.5 percent.

Elgi Equipments (Q4, YoY)

• Revenue up 24.1 percent at Rs 462.2 crore.
• Net profit up 30.3 percent at Rs 27.1 crore.
• Ebitda up 2.7 times at Rs 51.6 crore.
• Margin at 11.2 percent.

Bank of India (Q4)

• Net interest income down 26.1 percent year-on-year at Rs 2,563.8 crore.
• Net loss at Rs 3,969.3 crore.
• Provisions up 53.2 percent at Rs 6,699.2 crore (QoQ).
• GNPA at 16.58 percent (QoQ).
• NPA at 8.26 percent (QoQ).

Oil India (Q4, QoQ) (Standalone)

• Revenue up 5.1 percent at Rs 2,998.4 crore.
• Net profit up 22.9 percent at Rs 866.5 crore.
• Ebitda down 34.6 percent at Rs 800.7 crore.
• Margin at 26.7 percent.

Gravita India (Q4, YoY)

• Revenue up 79.1 percent at Rs 362.4 crore.
• Net profit up 20 percent at Rs 12 crore.
• Ebitda up 29 percent at Rs 24.9 crore.
• Margin at 6.9 percent vs 9.5 percent.

Aurobindo Pharma (Q4, YoY)

• Revenue up 11 percent at Rs 4,049 crore.
• Net profit down 0.5 percent at Rs 529 crore.
• Ebitda up 11 percent at Rs 805 crore.
• Margin at 19.9 percent vs 19.8 percent.

Shilpa Medicare (Q4, YoY)

• Revenue up 5.8 percent at Rs 234.5 crore.
• Net profit down 18 percent at Rs 30.6 crore.
• Ebitda down 16.1 percent at Rs 47.5 crore.
• Margin at 20.3 percent from 25.5 percent.

United Bank of India (Q4)

• NII up 2.3 percent YoY at Rs 513.5 crore.
• Net loss of Rs 260.6 crore versus net profit of Rs 735.6 crore.
• Provisions up 38.3 percent at Rs 1,333.4 crore (QoQ).
• GNPA at 24.1 percent versus 20.1 percent (QoQ).
• NPA at 16.49 percent versus 11.96 percent (QoQ).

NLC India (Q4, YoY) (Standalone)

• Revenue down 10.3 percent at Rs 2,542.9 crore.
• Net profit down 84 percent at Rs 381.3 crore.
• Ebitda down 47 percent at Rs 878.8 crore.
• Margin at 34.6 percent.

Rural Electrical Corporation (Q4, YoY)

• Revenue down 3.7 percent at Rs 5,632 crore.
• Net profit down 36.7 percent at Rs 834.8 crore.
• Ebitda down 4 percent at Rs 4,975.8 crore.
• Margin at 88.3 percent.

• Delhi High Court directs Fortis subsidiary to deposit Rs 503 crore in the account of the Delhi Government.
• Tamil Nadu government orders Vedanta to seal and permanently close the Copper smelter plant in Tuticorin.
• Binani Cement lenders vote in favour of UltraTech bid
• Government increases stake in IDBI Bank to 85.96 percent by acquiring 109.7 crore shares.
• Arihant Superstructures subsidiary gets loan approval amounting to Rs 250 crore from HDFC for Panvel project.

• Tamil Nadu orders permanent closure of Sterlite plant
• The Modi edition of taxing times
• Will Karnataka hasten move to hold simultaneous elections?
• Sexual violence is holding back the rise of India
• A few weaker public sector banks may not survive on their own, says SS Mundra
• Auditor quit as Manpasand Beverages didn’t share ‘significant’ information
• Oil marketers’ margins are declining despite rising fuel prices
• Bank of Baroda expects FY19 to be a turnaround year
• ICRA lowers ratings on Jet Airways’ loan facilities
• Indraprastha Gas hikes CNG price by Rs 1.36 per kilogram in Delhi
• Southwest monsoon hits Kerala, says Skymet
• Binani Cement lenders vote in favour of UltraTech bid

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India fell 0.23 percent to 10,672 as of 7:50 a.m.

Ten-year Treasury yields slumped, taking the dollar down against the yen, after Italy’s political impasse triggered a risk-off mood in holiday-hit markets. Oil prices retreated further, sending West Texas Intermediate crude to its lowest in six weeks.

Asia stocks were mixed, with benchmarks heading lower in Japan and flat in South Korea and Australia. Italy’s bonds and stocks tumbled overnight, taking the euro down along with them, after the country headed toward fresh elections following a failure to set up a government.

Bonds

• Then 10-year U.S. Treasury yield declined three basis points to 2.9 percent, after falling as low as 2.8949 percent.
• The 10-year Australian bond yield fell about three basis points to 2.73 percent.

Commodities

• West Texas Intermediate crude decreased 1.2 percent to $67.09 a barrel, heading for a fifth consecutive decline.
• Gold was little changed at $1,300.07 an ounce.

Key Events This Week

• EU trade chief Cecilia Malmstrom and U.S. Commerce Secretary Wilbur Ross are scheduled to meet on Wednesday in an informal World Trade Organization ministerial in Paris.
• The U.S. employment report for May is due on Friday. It’s the last jobs report before the Fed meeting in June.
• Automakers report May U.S. sales on the same day.
• Also Friday: China’s stock market joins MSCI Inc.’s global indexes.
• On Saturday, U.S. Secretary of Commerce Wilbur Ross will travel to Beijing for more talks with Vice Premier Liu He on topics including ZTE Corp. and trade.