Feb 15, 2017 01:00 PM IST | Source: Moneycontrol.com

Sensex falls 150 pts, Nifty breaks 8750 after Q3 earnings season

The BSE Midcap and Smallcap indices plunged 1 percent each on weak breadth. About three shares declined for every share rising on the exchange.

Sensex falls 150 pts, Nifty breaks 8750 after Q3 earnings season

Moneycontrol Bureau

12:55 pm Earnings estimates:
Packaged food maker Nestle India's fourth quarter earnings are expected to good year-on-year due to low base but sequential performance may be impacted by demonetisation.

Analysts say demonetisation impact may be seen most on chocolates, confectionary & discretionary part of portfolio (contributes around 25-30 percent to total revenue). However, impact may be offset by higher presence in urban areas.

Profit is seen rising 24 percent year-on-year to Rs 227.5 crore and revenue may increase 15.5 percent to Rs 2,263 crore in the quarter ended December 2016, according to average of estimates of analysts polled by CNBC-TV18.

Operating profit during the quarter is likely to jump 16.2 percent to Rs 451 crore and margin may expand by 10 basis points to 19.9 percent compared with year-ago period.

12:33 pm Economic growth:
Sources told CNBC-TV18 that Central Statistical Organisation may project FY17 GDP growth at 6.8-6.9 percent in second advance estimates as crude oil, pace of capital formation are big worries for FY18.

The government may not consider further public sector bank recapitalisation for FY17, say sources.

12:20 pm Interview:
Ravi Uppal, Managing Director and Chief Executive Officer of JSPL, said the company was committed to reducing its huge debt pile, but it would need to be done progressively and the immediate priority was to steady earnings.

Speaking to CNBC-TV18, Uppal said that one way of getting rid of its last reported consolidated gross debt of Rs 46,816 crore was to sell disposable assets, even as the company actively looks to sell stakes in its units.

Declaring its third quarter earnings on Tuesday evening, JSPL said it had managed to cut down its consolidated net loss by almost half to Rs 455 crore against a loss of Rs 882 crore in the same quarter last year. The company's consolidated revenue went up 25 percent to Rs 5,408 crore during the quarter while EBIDTA went up to Rs 1,277 crore against Rs 542 crore in the third quarter of the previous financial year. 

Also read - Buy, sell, hold: How to trade 6 key stocks post Q3 results? 

12:00 pm Market Check: Equity benchmarks as well as broader markets extended losses in later morning trade, with the Nifty breaking 8750 after investors digested third quarter earnings.

The 30-share BSE Sensex dropped 157.30 points to 28182.01 and the 50-share NSE Nifty fell 54.40 points to 8737.90.

The BSE Midcap and Smallcap indices plunged 1 percent each on weak breadth. About three shares declined for every share rising on the exchange.

ICICI Bank and Infosys declined more than 1 percent. L&T also lost morning gains, down 0.2 percent. Reliance Industries also came off day's high a bit.

Tata Motors shares continued to be under pressure, down 8 percent after disappointing earnings. Edelweiss downgraded to hold from buy, with reduced target price at Rs 501 (from Rs 604) after lowering FY17/18 EBIDTA estimates by 35/25 percent to Rs 29,500/38,500 crore to reflect weaker margins.

Sun Pharma slipped 3 percent after gross margin in Q3 contracted 560 basis points QoQ (440 bps YoY), primarily led by higher contribution from Olmesartan AG sales and Japan business consolidation. Hence, Motilal Oswal cuts FY18/19 EPS estimates by around 8 percent, building slower ramp-up in sales and margin expansion. However, it believes the current stock price does not reflect key positives like Ranbaxy integration benefits, Halol/Mohali plant resolution and investments in specialty business. It remains an attractive Indian play on specialty business in the US, the brokerage house says while retaining buy on the stock with target price of Rs 850.

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