Sensex falls 144 points, Nifty manages to hold 10,500; PSU banks drag
14 February 2018
3:30 pm Market Closing: Benchmark indices closed lower on sharp fall in PSU banks.
The 30-share BSE Sensex was down 144.52 points at 34,155.95 and the 50-share NSE Nifty declined 38.90 points to 10,500.90.
Nifty PSU Bank was down 5 percent as PNB fell over 10 percent
Allahabad Bank, OBC, Bank of India, Canara Bank and Union Bank of India plunged 5-8 percent.
Yes Bank was down nearly 5 percent.
3:29 pm Results: Tata Power Company has reported consolidated net profit at Rs 633 crore for December quarter 2017, falling 9.8 percent compared to Rs 702 crore in year-ago period.
Share of profit of associates and joint ventures, and deferred tax helped the company report profit for the quarter.
Consolidated revenue from operations grew by 5.7 percent to Rs 6,950 crore compared to Rs 6,574.5 crore in same quarter last fiscal.
3:24 pm Market Update: Benchmark indices extended losses in late trade, with the Sensex falling 141.51 points to 34,158.96 and the Nifty shedding 42.30 points to 10,497.50.
PSU Bank index extended losses, falling nearly 5 percent on Rs 11,300-crore worth of fraud in PNB's Mumbai branch, and revision of NPA rules by RBI.
3:20 pm Finance Ministry on PNB fraud: The finance ministry sought to allay worries over the Rs 11,300-crore fraud case at Punjab National Bank, saying the case not "out-of-control" and it is taking action in this respect.
"I don't think this is out of control or too big a worry at this point. That is my broad sense," Joint Secretary in Department of Financial Services Lok Rajan said.
Earlier in the morning Punjab National Bank (PNB) disclosed that it has detected some fraudulent transactions with financial implication of USD 1.77 billion (about Rs 11,334.4 crore) and the matter has been referred to law enforcement agencies for the recovery.
3:11 pm Earnings: Lovable Lingerie shares gained 6 percent as net profit in Q3 increased to Rs 2.3 crore from Rs 0.1 crore but revenue declined 1.5 percent to Rs 39.8 crore YoY.
The company had reported one-time loss of Rs 2 crore in Q3FY17.
Operating profit grew by 3.7 percent year-on-year to Rs 4.2 crore and margin expanded by 50 basis points to 10.6 percent in Q3.
3:06 pm Buzzing: Max Ventures shares rallied 9 percent after the company posted consolidated net profit at Rs 10.1 crore for December quarter against loss of Rs 2.7 crore in year-ago.
Revenue from operations increased 26.2 percent to Rs 210 crore and operating profit grew nearly 3-fold to Rs 24.9 crore (Rs 8.7 crore YoY) and margin expanded 660 basis points to 11.8 percent YoY.
3:01 pm Earnings: Grasim Industries' consolidated net profit in Q3 declined 17.4 percent year-on-year to Rs 786.9 crore, but revenue from operations increased 77.8 percent to Rs 15,291 crore.
Standalone net profit jumped 43 percent to Rs 474 crore and revenue from operations rose 75.3 percent to Rs 4,428.3 crore YoY.
Standalone operating profit shot up 60.9 percent to Rs 873.5 crore but margin contracted 180 basis points to 19.7 percent for December quarter YoY.
Grasim said the board has approved VSF capacity expansion at Gujarat unit with investment of Rs 3,523 crore and VSF capacity would increase by 58 percent post expansion & de-bottling plans.
2:50 pm Buzzing: Satin Creditcare shares gained 6.5 percent as net profit in Q3 increased 28 percent to Rs 21.6 crore and revenue from operations grew by 20.2 percent to Rs 262.7 crore compared to year-ago.
2:40 pm Expansion: Agrochemical formulations company Dhamaka Agritech Ltd today said it will expand business activities and presence in Rajasthan in the next fiscal year.
"We are aiming to increase our distributors and experts in Rajasthan where the company has close to 5 per cent share in Rajasthan market," Atul Kumar, senior general manager of the company said.
He said the company is planning to add more members to workforce in the market.
"In Rajasthan, we have 50 agro experts 'Dhanuka doctors' who suggest farmers on crop management and we are increasing this number to 80 in next fiscal year."
2:30 pm Earnings: Public sector lender Allahabad Bank has posted net loss of Rs 1,263.79 crore for December quarter 2017, dented by higher provisions and lower other income.
Profit reported by the bank for year-ago quarter was at Rs 75.26 crore.
Net interest income, the difference between interest earned and interest expended, grew by 13.83 percent to Rs 1,346.91 crore compared to Rs 1,183.31 crore in same quarter last year.
2:24 pm Order Win: State-run power equipment maker BHEL has received Rs 560 crore worth of order for emission control equipment from NTPC.
2:15 pm Results Reaction: Dhanuka Agritech and Gateway Distriparks shares declined 1 percent each after weak operational performance.
Dhanuka Agritech's Q3 profit grew by 6.4 percent year-on-year to Rs 28.6 crore and revenue from operations increased 4.6 percent to Rs 221.5 crore, but operating profit fell 9 percent to Rs 35.3 crore and margin contracted 240 basis points to 15.9 percent compared to year-ago.
Gateway Distriparks said profit in Q3 fell 37.4 percent to Rs 10.2 crore and revenue from operations slipped 3.4 percent to Rs 80.4 crore.
Operating profit was down 17.5 percent at Rs 16 crore and margin contracted 330 basis points to 19.9 percent compared to year-ago.
2:10 pm Europe Trade: European stocks traded higher, as investors monitored the release of corporate earnings and economic data.
France CAC, Germany DAX and Britain FTSE were trading 0.7 percent higher.
2:05 pm PNB in focus: Punjab National Bank share price slipped 8 percent intraday after the bank detected some fraudulent transactions worth Rs 11,300 crore in its Mumbai branch.
The fraudulent transaction amount is close to 1/3rd of its total market capitalisation of Rs 36,000 crore and 2.55 percent of total loan book of Rs 4.5 lakh crore (as of December 2017).
With the sharp fall, investors lost nearly Rs 3,000 crore of wealth on single day.
1:55 pm Buzzing: KNR Constructions shares declined 1 percent as profit in Q3 more than doubled to Rs 65.7 crore from Rs 30.7 crore in year-ago.
Revenue from operations increased 13.3 percent to Rs 433.2 crore and operating profit jumped 70.6 percent to Rs 98.4 crore and margin expanded 760 basis points to 22.7 percent YoY.
1:45 pm Earnings: Carborundum Universal shares fell 1.6 percent despite net profit in Q3 increased 21.7 percent year-on-year to Rs 56.5 crore and revenue from operations rose 16 percent to Rs 611.6 crore.
Operating profit jumped 29.4 percent to Rs 104.7 crore and margin expanded 180 basis points to 17.1 percent in Q3.
1:35 pm Wind Tariffs: Fall in wind power tariffs seem to be have bottomed out as the price inched up to Rs 2.44 per unit in the latest auction for 2000 MW capacities.
The auction was conducted by Solar Energy Corporation (SECI) yesterday.
Sources said as many as six firms, including Torrent Power, Inox Wind Infrastructure Services, Green Infra Wind Energy, and ReNew Power emerged as the lowest bidders for 2000MW wind capacities.
They said these four firms quoted a tariff of Rs 2.44 per unit while Adani Green Energy and Alfanar Company quoted Rs 2.45 per unit.
1:25 pm Earnings: Patel Engineering has turned profitable in Q3 with net income at Rs 6.9 crore despite one-time loss of Rs 273.6 crore and tax expenses of Rs 55.9 crore.
It had reported loss of Rs 0.7 crore in Q3FY17.
The stock price surged nearly 14 percent.
Revenue from operations declined 10.4 percent to Rs 635.7 crore YoY, but operating profit shot up sharply to Rs 267 crore and margin expanded to 42 percent from 13.7 percent YoY.
1:20 pm Buzzing: Sunteck Realty shares rallied 6 percent after profit in Q3 jumped sharply by 238 percent to Rs 602 crore and revenue increased 141 percent to Rs 2,105 crore compared to year-ago.
Operating profit shot up 160 percent year-on-year to Rs 891 crore and margin expanded 300 basis points to 44 percent in Q3.
1:09 pm Earnings Reaction: GVK Power shares fell 4 percent as the company reported profit at Rs 10.9 crore for Q3 was largely led by other income but revenue and operational performance was very bad for the quarter.
The company posted loss of Rs 0.7 crore in year-ago quarter.
Revenue from operations slipped 56 percent year-on-year to Rs 3.1 crore and operating profit declined 71.7 percent to Rs 0.9 crore and margin contracted sharply to 28.4 percent from 44.1 percent YoY.
The company reported other income at Rs 18.2 crore for the quarter against Rs 11.3 crore in same quarter last year.
12:59 pm Market Update: Benchmark indices remained volatile in afternoon, but the broader markets continued to outperform.
The 30-share BSE Sensex was down 37.58 points at 34,262.89 and the 50-share NSE Nifty fell 5.90 points to 10,533.90.
About 1,478 shares advanced against 1,118 declining shares on the BSE.
PSU Bank is the biggest loser among sectoral indices, falling 3 percent after double whammy effects for Punjab National Bank and Bank of India.
One is common for both that the RBI revised bad loan resolution rules. Punjab National Bank has detected some fraudulent and unauthorised transactions worth more than Rs 11,000 crore in a Mumbai branch while Bank of India posted a big loss in Q3 on higher provisions and weak asset quality performance.
12:50 pm Earnings: NCC shares gained 4 percent as company's Q3 net profit jumped 72.2 percent to Rs 100.4 crore on strong operational performance.
Revenue from operations fell 2.8 percent to Rs 1,851 crore while operating profit jumped 46.4 percent to Rs 255.1 crore and margin expanded 470 basis points to 13.8 percent YoY.
Profit was despite one-time loss at Rs 30 crore for the quarter against loss of Rs 7.8 crore in year-ago.
12:35 pm PNB's fraud: The CBI has received two complaints from PNB against billionaire jewellery designer Nirav Modi and a jewellery company about fraudulent transactions worth Rs 10,000 crore, official sources told PTI.
The agency received the complaints about the transactions detected by the public sector bank late last night, sources said.
The complaints deal with fraudulent transactions reported from the bank's branches and the amount involved is over Rs 10,000 crore, the sources said.
The allegations are being looked into and future course of action will be decided soon, they said.
The agency has refused to share any further details as it may hamper the investigation.
Agency sources said Modi is already facing a CBI probe on a complaint from the Punjab National Bank.
12:34 pm DLF's Debt: Realty major DLF's net debt has come down substantially to Rs 5,513 crore at the end of October-December quarter on fund infusion by promoters as it targets to become a zero-debt company by the end of next fiscal.
DLF, the country's largest real estate developer, repaid loans of Rs 7,100 crore using fund infused by the promoters.
According to an investor presentation, DLF's net debt stood at Rs 5,513 crore as on December 31, 2017, and this is primarily from development business of housing projects.
The debt from commercial real estate business has now been reflected in DLF Cyber City Developers Ltd (DCCDL), the company's joint venture firm with Singapore's sovereign wealth fund GIC. The net debt of DCCDL stood at Rs 16,074 crore at the end of third quarter of this fiscal. The JV holds the bulk of rent-yielding commercial assets of DLF group.
DLF's total debt stood at Rs 26,800 crore at June-end this financial year.
12:29 pm PSU Bank Losers:
12:21 pm Poll: Tata Power Company's third quarter consolidated profit is expected to fall 22 percent to Rs 466 crore compared to Rs 599 crore in year-ago quarter.
Revenue from operations may grow 11 percent to Rs 7,445 crore compared to Rs 6,684 crore in same quarter last fiscal, according to average of estimates of analysts polled by CNBC-TV18.
Operating profit is likely to increase 15 percent year-on-year to Rs 1,611 crore and margin may expand 70 basis points to 21.6 percent in Q3.
Year-on-year profit comparison may not be valid due to (1) higher interest cost in Q3FY18 to fund renewable asset acquisition and (2) tax reversal in Q3FY17, despite stable operations in the core distribution business.
Analysts expect generation volumes to remain sluggish and realisations to remain flattish. They further expect coal business and renewable business to maintain strong momentum.
12:10 pm Management Interview: Vaibhav Rawat, CFO of Dilip Buildcon told CNBC-TV18 that he expects bonus for 5 projects in Q4.
Order inflow was tepid in Q3, but he expects Rs 8,000 crore worth of order inflows over next 3-4 months, he said.
Current orderbook is over Rs 15,000 crore, he added.
12:01 pm LTCG impact: The proposal of long-term capital gains tax will not have much impact on the National Pension Scheme (NPS), a top Pension Fund Regulatory and Development Authority (PFRDA) official has said.
"It will not have much impact on us. The investments in the National Pension System are made by our trust (NPS Trust) which is a tax-exempted body. As far as pension investments are concerned, LTCG will not have an impact," NPS regulator PFRDA chairman Hemant Contractor said here yesterday Contractor said this on the sidelines of a conference on the NPS in association with Stock Holding Corporation.
However, it will have an impact on tier II accounts also known as non-pension account, he said.
NPS manages two types of accounts -- tier I and tier II. "Tier II has no tax benefits. Tier II account would be impacted but investments corpus in tier II is much smaller," Contractor said.
11:50 am Top Losers in the Smallcap:
11:40 am Company Name Change: Sona Koyo Steering informed exchanges that the Ministry of Corporate Affairs has made available the proposed new name JTEKT India Limited, vide its letter dated 12th February, 2018.
Consequent upon receipt of the aforesaid letter of MCA, the directors of the company recommended to the shareholders a special resolution to be passed by way of postal ballot, to approve change in the name of the company.
11:32 am Results Reaction: Nitco Tiles shares rallied 12 percent after the Q3 loss narrowed to Rs 8.1 crore from Rs 9 crore in year-ago due to improvement in operational performance.
Revenue from operations slipped 17.1 percent year-on-year to Rs 137.8 crore while operating profit increased 28 percent to Rs 1.6 crore and margin expanded 40 basis points to 1.1 percent in Q3.
11:20 am Nickel futures rise: Amid pick up in demand in the domestic spot market, nickel prices edged higher by 0.16 percent to Rs 863.30 per kg in futures market today as speculators built up fresh positions.
At the Multi Commodity Exchange, nickel for delivery in February edged up by Rs 1.40, or 0.16 per cent, to Rs 863.30 per kg in business turnover of 2,980 lots.
Similarly, the metal for delivery in March contracts was trading higher by 90 paise, or 0.10 percent, to Rs 866.80 per kg in 51 lots.
11:10 am Earnings: Godrej Industries' Q3 consolidated net profit fell 11.8 percent year-on-year to Rs 131 crore on weak operational performance.
Revenue from operations increased 14.9 percent to Rs 2,458 crore from Rs 2,139 crore in year-ago.
Operating profit fell 22.7 percent to Rs 152.5 crore and margin contracted by 300 basis points to 6.2 percent compared to last year.
11:01 am Market Update: Benchmark indices traded in a tight range around Monday's close, but the broader markets continue to outperform, with the Nifty Midcap index rising more than half a percent.
The 30-share BSE Sensex was up 35.16 points at 34,335.63 and the 50-share NSE Nifty gained 15.20 points at 10,555.
About two shares advanced for every share falling on the BSE.
The market was shut on Tuesday for Mahashivratri holiday.
10:50 am Expert on NPA rules: The new non performing asset (NPA) rules introduced by the Reserve Bank of India (RBI) earlier in the week are positive for the banking sector in the long term, Manish Gunwani, CIO Equity Investments at Reliance Mutual Fund said in an interview with CNBC-TV18.
All the earlier schemes like S4A, SDR, CDR, JLF, etc, stand withdrawn with immediate effect. Banks need to make appropriate disclosures in their financial statements, under 'Notes on Accounts', relating to resolution plans implemented.
''We are very positive on the new rules introduced by the RBI. Although there could be near-term impact on earnings. It would lead to faster recognition of bad loans but you could argue that valuation multiple should expand a bit now,'' he said.
Gunwani further added that extreme cycles of NPL that we use to see should reduce now because the resolution will become faster, lending becomes more transparent. If one banking is making one company an NPA then other banks have to also do it.
10:40 am Buzzing: Share price of JK Tyre and Industries slipped 6 percent intraday as company reported poor numbers in the quarter ended December 2017.
The company's Q3 net profit was down 88.43 percent at Rs 9.97 crore against Rs 86.19 crore in the same quarter last year. Revenue of the company was up 15 percent at Rs 2,123 crore.
The operating profit (EBITDA) was down 16 percent at Rs 212 crore and margin was down 370 bps at 10 percent.
The board at its meeting held on February 12 approved raising of funds for an amount upto Rs 1,000 crore.
10:23 am Results Reaction: Shares of NRB Bearings and Aarti Drugs rose more than 7 percent intraday on the back of strong third quarter results.
Aarti Drugs has reported 35 percent jump in its Q3 net profit at RS 23 crore and revenue was up 15.5 percent at Rs 335 crore.
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) was up 28.5 percent at Rs 54 crore and margin was up 160 bps at 16 percent
NRB Bearings recorded 176 percent jump in Q3 net profit at Rs 21.3 crore against Rs 7.7 crore. Revenue was up 25.8 percent at Rs 207.9 crore versus Rs 165.3 crore. EBITDA doubled at Rs 40.5 crore and margin was up 730 bps at 19.5 percent.
10:12 am Expansion: FMCG major Britannia Industries has plans to launch around 50 new products under its existing as well as new categories by the end of the next fiscal as part of efforts to be a total food company, said a top company official.
In view of its growth strategy, Britannia will launch dairy products and croissants by October-November this year through its joint venture with Greek cakes and confectionery major Chipita.
Besides, the company will continue with its strategy of adding new countries in its list and scout for new markets in Africa, while foraying into Bangladesh and Myanmar.
10:01 am Rupee Trade: The rupee strengthened by 19 paise to 64.13 against the US dollar in morning aided by stronger domestic equities.
The weakness in dollar against some currencies overseas after US Federal Reserve chairman Jerome Powell said that the central bank would remain alert to risks to financial stability in the wake of recent market rout also supported the rupee's upmove.
The US dollar hit a five-month low against the yen after Japan's economy recorded its longest growth streak in 28 years.
Besides, industrial output grew 7.1 percent in December and selling of the American currency by exporters supported the rupee, forex dealers said.
Forex market was closed yesterday for a public holiday.
On Monday, the rupee had ended 8 paise higher to end at 64.32 against the dollar on fresh selling of the American currency by exporters and banks in line with strong domestic equity market.
9:50 am PSU Banks under pressure: PSU banks came under pressure in morning after the Reserve Bank of India (RBI) has revised the new stressed assets framework asking banks to resolve defaults within 180 days.
Further, starting February 23, banks must immediately identify the defaults and make disclosures every Friday to the RBI credit registry.
Reacting to the news, public sector banks got hammered the most in morning trade. The Nifty PSU Bank index slipped 2 percent compared to 0.5 percent fall in the Nifty Bank index, and 0.5 percent decline seen in Nifty Private Bank index.
In the PSU Bank index, Punjab National Bank slipped 4 percent, followed by Bank of India which was down 4 percent, State Bank of India slipped 1.7 percent, IDBI Bank was down 2.7 percent, and Syndicate Bank slipped 2.6 percent so far in the trade today.
The revised stressed asset framework would lead to accelerated and early recognition of NPAs in the banking system and would require higher provisioning expense, suggest experts.
9:40 am Heavyweights gain: Reliance Industries, HDFC, HDFC Bank, Infosys and Larsen & Toubro continued to support the market, rising 0.6-1.5 percent.
9:31 am Buzzing: Share price of Precision Camshafts gained 4 percent in the morning on receiving multiple orders worth Rs 275 crore.
The company has won additional contracts from OEM's including Ford, general Motors and Mahindra & Mahindra.
The company's Q3FY18 net profit declined 51 percent at Rs 6.65 crore against Rs 13.71 crore in the same quarter last fiscal.
9:21 am Fraud: Punjab National Bank said it has detected some fraudulent and unauthorised transactions (messages) in one of its branch in Mumbai for the benefit of a few select account holders with their apparent connivance. Based on these transactions other banks appear to have advanced money to these customers abroad. In the Bank these transactions are contingent in nature and liability arising out of these on the Bank shall be decided based on the law and genuineness of underlying transactions. The quantum of such transactions is USD 1771.69 million (approximately). The matter is already referred to law enforcement agencies to examine and book the culprits as per law of the land. The Bank is committed to clean and transparent banking.
9:15 am Market Check: Benchmark indices started off the day higher on Wednesday, with the Sensex rising around 100 points, tracking positive global cues.
The 30-share BSE Sensex was up 86.64 points at 34,387.11 and the 50-share NSE Nifty gained 29.70 points at 10,569.50.
About 1,101 shares advanced against 353 declining shares on the BSE.
Nifty Midcap index was up 142 points.
Voltamp Transformers, NRB Bearings, Kolte-Patil, DLF, IOL Chemicals, Ester, Dilip Buildcon, NMDC, Britannia Industries, Ashok Leyland and Minda Industries gained 1-4 percent whereas JK Tyre and Motherson Sumi lost 2-4 percent post earnings.