Closing Bell: Sensex tanks 750 pts, Nifty closes below 24,550; Q1 results drag Ultratech, BPCL 3-4%, lifts Infosys 2%

Indian shares traded lower on Friday due to weak global market cues and fears of new U.S.-China trade tensions. Despite opening at record highs, the Nifty 50 and Sensex quickly slipped into the red and fell sharply later in the session. India's benchmark stock indices ended their rally by hitting downward trends after a fresh record high for the fourth consecutive session on Friday. Sectors like Metal, Auto, Financial Services, and Energy saw significant declines. Brokerages' Stocks Fall As Microsoft Outage Impacts Operation. On the stock-specific front, Infosys shares rose after posting better-than-expected Q1 FY25 results and raising its FY25 revenue growth forecast to 3-4%. Other top gainers included Asian Paints, LTIMindtree, and Titan Company. In contrast, Persistent Systems fell nearly 7% after its Q1 profit missed estimates.

The benchmark index initially opened 52 points higher but quickly faced selling pressure. After reaching a peak of 24854, it dropped over 100 points in the first few minutes of trading, accompanied by high volume, setting the tone for the day. The index continued to trend lower as selling pressure intensified, closing 269 points lower. Despite a significant correction and adverse market and momentum breadth, the index showed resilience by not dropping below the prior day’s low and closing above the psychological mark of 24500. Going forward, it will be crucial for the index to maintain support in the range of 24500-24200 to sustain bullish momentum.

Gold and silver prices experienced a sharp decline following the sentiment that the anticipated bullish phase might have occurred earlier than expected, leading to profit-taking. A recent slowdown in seasonal demand could exert downward pressure on prices if ETF flows do not persist or if tactical investors retreat due to high prices. U.S. data revealed the largest increase in initial jobless claims since early May, indicating a cooling labor market. This development supports a potential rate cut by the Federal Reserve in September. Despite the recent dip, gold remains nearly 20% higher, and silver over 15% higher since the beginning of the year. Additionally, uncertainty in the U.S. political landscape is contributing to short-term volatility. This temporary decline is seen as a necessary adjustment, providing central bankers an opportunity to regain purchase traction. For Gold support is placed at $2385 - $2350 whereas for silver it is at $29. - $28.85

On the other hand, oil prices have continued to decline, influenced by weak demand from China and pressure from a stronger dollar. China's economy grew at a much slower pace than expected in the second quarter, countering the narrative of tight supply. However, the significant drawdown in U.S. stockpiles and improved compliance with production cuts by OPEC members are expected to keep the market undersupplied by more than a million barrels, thereby providing support for crude oil prices. West Texas Intermediate (WTI) prices are expected to find support around $78 to $80 per barrel.

Meanwhile, the USD/INR is trading at an all-time low  due to a stronger dollar and widespread weakness across Asian currencies. According to the latest bulletin released by the Reserve Bank of India (RBI), the central bank purchased $4.2 billion of forex. Additionally, the market is closely monitoring the Union budget for FY 2024-25, to be held on July 23rd, for a clearer picture of economic growth. Earlier this week, the International Monetary Fund (IMF) raised India's growth projection from 6.8% to 7%. The rupee is expected to respect the resistance of 83.75 – 83.85 levels, with a potential retracement to the 83.50 level.

An Anti-virus Crowdstrike faced a technical glitch after an update that affected the Microsoft servers and PCs where this anti-virus was installed. This anti-virus is also installed on Microsoft servers provided by Azure as a part of their cloud infrastructure. Azure accounts for 25% market share amongst cloud services. Hence a lot of large organizations, airlines, stock exchanges globally who use Azure had technical glitches. The Crowdstrike team is currently working to resolve the issue.

Wipro Ltd on 19 July reported its Q1 FY25 net profit rose from a year ago to Rs 3,003 crore, beating market expectations. The IT company’s April-June consolidated revenue fell to Rs 21,964 crore.

A Moneycontrol poll of brokerage estimates had pegged Wipro’s fiscal first quarter net profit to rise to Rs 2,953 crore, and revenue to fall to Rs 22,229 crore.

Rupee ends at record low of 83.66/$ against the US dollar, lower than Thursday’s close of 83.65/$

Profit booking seeped across the market ahead of the Union Budget 2024, to be tabled on July 23. Caution ahead of the event also triggered a bout of strong profit booking, pulling all major indices down in the red.

At close, the Sensex was down 755.48 points or 0.93 percent at 80,587.98, and the Nifty was down 275.20 points or 1.11 percent at 24,525.60. About 756 shares advanced, 2618 shares declined, and 74 shares unchanged.

All sectors witnessed selling and ended with losses.

#1 Net Profit down 28.6% At Rs 3,015 Cr Vs Rs 4,224 Cr (QoQ)

#2 Revenue down 2.6% At Rs 1.13 Lk Cr Vs Rs 1.16 Lk Cr (QoQ)

#3 EBITDA falls 38.7% At Rs 5,650 Cr Vs Rs 9,211 Cr (QoQ)

#4 Margin At 5% Vs 8% (QoQ)

UltraTech Cement reported a weak set of Q1 FY25 results, with consolidated net profit flattish on-year at Rs 1,695 crore, missing estimates. April-June quarter consolidated revenue rose to Rs 18,069 crore.

A Moneycontrol poll estimated India’s largest cement maker’s fiscal first quarter consolidated net profit at Rs 1,733 crore and revenue at Rs 17,962 crore, representing small rises on a year-on-year basis.

#1 Net profit down 12.9% at Rs 53.4 cr vs Rs 61 cr (YoY)

#2 Revenue up 8.5% at Rs 1,343 cr vs Rs 1,237.5 cr (YoY)

#3 EBITDA up 5.8% at Rs 202.2 cr vs Rs 191.2 cr (YoY)

#4 Margin at 15.1% vs 15.4% (YoY)

Shares of Hindustan Aeronautics Ltd (HAL) extended losses, falling over 3 percent despite the aerospace and defence firm announcing a revised Memorandum of Understanding (MoU) with the Aeronautical Development Agency (ADA), bolstering their collaboration on the LCA AF Mk-2 program.

A sales note from InCred citing valuation concerns within defence stocks like HAL has likely spooked investors.

The brokerage compared HAL with its global peer Dassault Aviation. Dassault reported revenue of $5.19 billion with a profit of $974 million in the last financial year, while HAL posted revenue of $3.67 billion with a profit of $921 million during the same period. Read More

Net Profit up 8.4% At  Rs 112 Cr Vs Rs 103.3 Cr (YoY)

Revenue up 12% At Rs 1,322 Cr Vs Rs 1,182 Cr (YoY)

EBITDA up 22.5% At  Rs 223 Cr Vs Rs 182 Cr (YoY)

Margin At 16.9% Vs 15.4% (YoY)

#1 Q1 margin miss on weaker mix

#2 Maintain 20 percent/17 percent revenue growth for FY25/26 (18 percent/14 percent ex-Lloyd)

#3 Price hikes & stable commodity should support margin

#4 Stock trades at 54x FY26 EPS, which believe factors in expected earnings recovery

Sanstar Limited's initial public offering (IPO) was subscribed 2.4 times on the first day of bidding on July 19 with non-institutional investors leading the charge. The Rs 510.15-crore public offer attracted bids for 7.7 crore equity shares, surpassing the offer size of 3.8 crore equity shares, according to exchange data.

The public offer, which opened for subscription today, has a price band set at Rs 90-95 per share. The bidding is scheduled to close on July 23, 2024.

Non-institutional investors displayed the most enthusiasm, bidding nearly 4 times their allotted quota. Retail investors followed closely, subscribing 2.4 times of their reserved portion. The portion set aside for qualified institutional buyers (QIBs) was subscribed 1 percent.

#1 Despite the miss, company has strong deal pipeline & maintained revenue & margin guidance for FY25

#2 Ask rate to meet revenue guidance is high, & continued estimate cuts could limit positive triggers

#1 Small EBITDA beat in Q1 while key positive was better realisations

#2 Opex/t was broadly in-line with estimate

#3 Weak volumes, however, were a key negative

#1 Q1FY25 was a miss with revenue/EBITDA -2.5 percent/-8 percent QoQ & were -5 percent/-9 percent below consensus

#2 Softness was due to phasing of customer business in the smaller technology solutions segment

#3 Softness was due to Vinfast customer related QoQ moderation in revenue in core services (auto) business

#4 Going forward, management expects a return to sequential growth in the business in Q2-Q3-Q4 Of FY25

RVNL has signed Memorandum of Understanding (MoU) with M/s United Construction Limited, Israel to co-operate with each other to get projects in the field of Railways, MRTS, Tunnels, Roads (Highways & Expressways), Bridges, Building Works, Airports, Ports, Irrigation, Power Transmission and Distribution Sector, Solar Sector, Wind Sector in Israel.

In another development in dispute settellment between Krishnapatnam Railway Company Limited (KRCL) (a JV/SPVof RVNL with RVNL's share of 49.76%) and Ministry of Railway, the Hon'ble tribunal has passed an award of Rs. 584.22 crores in favour of the claimant (KRCL).

Divis Laboratories informed that the US Food and Drug Administration (US-FDA) conducted a general cGMP inspection of the Company's Unit-II manufacturing facility at Chippada Village, Bheemunipatnam Mandal, Visakhapatnam, Andhra Pradesh from July 11, 2024 to July 19, 2024.

The US-FDA inspection is successfully completed with one procedural observation, which will be addressed in the stipulated period of time.

#1 Q1 was in-line with estimates

#2 Strong sale (+20 percent YoY) was driven by good offtake in summer products, B2B offtake, albeit with interim election impact

#3 Lloyd posted EBIT margin at +3.5 percent in Q1 (+2.8 percent In Q4FY24)

#4 Cut FY25-27 EPS by 1-2 percent

The company has opened its qualified institutions placement (QIP) issue on July 18. The floor price has been fixed at Rs 221.57 per share.

The Capital Raising Committee of the board will meet on July 23 to consider the rights issue price and related payment mechanisms, rights entitlement ratio, the record date, and the timing of the issue. The board had approved a rights issue worth Rs 3,000 crore in January 2024.

The Capital Raising Committee of the board has approved the second tranche of the allotment of 41,52,02,701 equity shares worth Rs 614.5 crore at an issue price of Rs 14.80 per share, to Nokia Solutions and Networks India and Ericsson India, vendors of the company, on a preferential basis.

#1 Net loss at Rs 22.7 crore Vs profit at Rs 14.5 crore, YoY

#2 Revenue increases 7.6% to Rs 1,069.3 crore Vs Rs 993.6 crore, YoY

The Sensex was down 518.40 points or 0.64 percent at 80,825.06, and the Nifty was down 197.10 points or 0.79 percent at 24,603.70.

#1 Q1FY25 was an all-round beat

#2 Surprise revenue guidance driven by strong start, deal wins, & acquisition integration

#3 Project maximus’ impact on margin continues to play out

#4 Raise our FY25-26 EPS by nearly 2-3%, reiterate as top pick

#1 Net loss narrows to Rs 28.4 crore Vs loss at Rs 39.8 crore, YoY

#2 Revenue rises 3.9% to Rs 560.6 crore Vs Rs 539.7 crore, YoY

The fiscal deficit target for FY25 is likely to stay at 5.1% of GDP as per the interim budget. Emphasis will be on job creation through capital expenditure, targeted social spending, and the 'Viksit Bharat' initiative.

The budget may also outline a roadmap for fiscal consolidation beyond FY26. While no reduction in personal income tax rates is expected, there could be tax relief for middle-income taxpayers.

Key sectors to watch include agriculture, start-ups, housing, railways, defence, electronics, and renewables.

Changes in short-term capital gains tax rates are anticipated, but significant hikes in long-term capital gains tax rates are not expected.

#1 Profit rises 0.7% to Rs 145 crore Vs Rs 144 crore, YoY

#2 Revenue drops 0.2% to Rs 3,621 crore Vs Rs 3,627 crore, YoY

#1 Profit jumps 7% to Rs 154.2 crore Vs Rs 144 crore, YoY

#2 Revenue increases 8.8% to Rs 3,192.8 crore Vs Rs 2,935.2 crore, YoY

#1 Profit increases 1.3% to Rs 216.4 crore Vs Rs 213.6 crore, YoY

#2 Revenue drops 1.2% to Rs 2,292.7 crore Vs Rs 2,320.3 crore, YoY

Nazara Technologies board approved to make strategic investment by way of secondary acquisition of 5,157 equity shares of Rs 10 each, representing 48.42% of the equity share capital of Paper Boat Apps Private Limited, a subsidiary of the company, from its existing founder shareholders (i.e. Mr. Anupam Dhanuka and Ms. Anshu Dhanuka), at a total consideration not exceeding Rs 300 crore, to be paid in cash.

Reliance Industries, Wipro, UltraTech Cement, Bharat Petroleum Corporation, JSW Steel, Union Bank of India, ICICI Lombard General Insurance Company, One 97 Communications (Paytm), Patanjali Foods, Aether Industries, Atul, BEML Land Assets, Blue Dart Express, CreditAccess Grameen, Fedbank Financial Services, Indian Hotels, JSW Energy, Jubilant Pharmova, Mahindra EPC Irrigation, Nippon Life India Asset Management, Oberoi Realty, Orissa Minerals Development Company, PVR Inox, Route Mobile, RPG Life Sciences, Supreme Petrochem, Stanley Lifestyles, Tejas Networks, Transformers and Rectifiers (India), and Vipul Organics will release their quarterly earnings on July 19.

The Competition Commission of India (CCI) has approved the acquisition of up to 56% shareholding of Ismartu India by Dixon Technologies.

The company has received an order worth Rs 103 crore from NHAI, New Delhi, and Eastern Railway, Kolkata. The contract is an enhancement of the existing contract with NHAI and Eastern Railway, Kolkata.

Awaiting Approval To Start  Onboarding Of New UPI Users

Seeing A Rebound In Our  Merchant Operating Metrics

Confident In Our Trajectory Towards Sustained Growth Going Forward

Full Financial Impact Of The Recent Disruptions Is Visible In Q1FY25

Rev & Profitability Expected To Improve Going Forward

Cons net loss at Rs 839 cr  vs loss Of  Rs 357 cr (YoY)

Cons revenue falls 36 percent to Rs 1,502 cr vs Rs 2,342 cr (YoY)

Zydus Lifesciences shares fell 3 percent on July 19 after the company's Jarod injectables manufacturing facility got classified as 'Official Action Indicated' (OAI) by the United States Food and Drug Administration (USFDA).

This comes after the US drug regulator inspected the facility from April 15-23 this year. The inspection was followed by the US FDA issuing 10 observations for the facility under review. The observations issued by the US FDA were likely not rectified by the drugmaker, leading to the OAI classification of the facility.

The drugmaker also received US FDA approval for Zituvimet extended-release tablets today. Zituvimet is used as an adjunct to diet and exercise to improve glycemic control in adults with type 2 diabetes.

Caplin Steriles, a subsidiary company of Caplin Point Laboratories has been granted final approval from the United States Food and Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) Ephedrine Sulfate injection USP, 50 mg/mL Single Dose vial, a generic therapeutic equivalent version of the Reference Listed Drug (RLD) AKOVAZ, from Exela Pharma Sciences LLC.

KPI Green Energy received a new order for a 100 MW Hybrid Captive Solar Power Project from Aether Industries under the Captive Power Producer (CPP) segment of the company.

The United States Food and Drug Administration (USFDA) has conducted an inspection at the company's injectables manufacturing facility at Jarod, Gujarat, from April 15 to April 23 this year.

The USFDA has determined that the inspection classification of this facility is Official Action Indicated (OAI).

The company has approved a plan to merge its step-down subsidiary, vCustomer Philippines (Cebu) Inc., with its parent company, vCustomer Philippines Inc.

vCustomer Philippines Inc. is a wholly owned subsidiary of Tech Mahindra.

The merger is subject to regulatory approvals in the country of incorporation.

Sanstar is looking to payoff its debt and strengthen its balance and invest into building additional capacity to fuel their growth. Post the proposed expansion, the capacity will almost double from current levels creating a huge headroom for growth.

The current capacity is already 90% filled and the capex for expansion has already started. The valuation of the IPO is at par with the listed peers, but given the growth rospects, we advise to subscribe to the IPO keeping a long term view.

#1 Profit increases 4.3% to Rs 141.2 crore Vs Rs 135.4 crore, YoY

#2 Revenue grows 10% to Rs 1,002.2 crore Vs Rs 911.1 crore, YoY

Shares of Go Digit General Insurance surged 7 percent intraday to Rs 363 in the morning trade on July 19 after international brokerage Citi initiated coverage with a 'buy' call as it sees multiple levers of growth for the company.

Analysts have assigned a price target of Rs 425, implying an upside potential of 25 percent from the current market levels. Citi expects the company's Return on Equity (RoE) to increase to 15-16 percent in FY26-27 from nearly 7 percent in FY24.

A steady 13 percent annual growth in non-life premiums (excluding crop insurance), driven by health and B2B business is also anticipated, Citi said in a recent note on the company.

#1 Profit surges 45.4% to Rs 294.1 crore Vs Rs 202.4 crore, YoY

#2 Net interest income increases 7.2% to Rs 865.8 crore Vs Rs 807.7 crore, YoY

#3 Gross NPA flat QoQ at 4.50%, YoY

#4 Net NPA falls QoQ to 1.44% Vs 1.46%, YoY

#1 Profit drops 2.8% to Rs 306.4 crore Vs Rs 315 crore, QoQ

#2 Revenue rises 5.7% to Rs 2,737.2 crore Vs Rs 2,590.5 crore, QoQ

#3 EBIT grows 2.6% to Rs 384 crore Vs Rs 374.4 crore, QoQ

#4 EBIT margin dips 50 bps to 14% Vs 14.5%, QoQ

Shares of Sahaj Solar Limited made a robust start on its stock market debut on July 19, listing at Rs 342, commanding a premium of 90 percent over the issue price of Rs 180 per share.

The Rs 52.56-crore public offer came firing out of the blocks during the subscription period as investors subscribed a massive 506 times. Non-institutional investors were the most active, buying 862 times their allotted quota. Retail investors followed, purchasing 534 times while qualified institutional buyers roped in 214 times the portion reserved.

#1 Profit declines 8% to Rs 313.6 crore Vs Rs 340.9 crore, QoQ

#2 Revenue slips 3% to Rs 2,461.9 crore Vs Rs 2,537.5 crore, QoQ

#3 EBIT dips 10.4% to Rs 383.6 crore Vs Rs 428.2 crore, QoQ

#4 Margin drops to 15.6% Vs 16.9%, QoQ

#5 Revenue in dollar terms down 3.3% at $295.2 million Vs $305.1 million, QoQ

#6 Revenue in constant currency down 3.1%, QoQ

Gold prices slipped on Friday, but were on track for a fourth straight weekly gain as expectations that the Federal Reserve will cut interest rates in September lifted bullion's appeal.

Spot gold fell 0.8% to $2,424.34 per ounce. It has risen 0.7% so far this week, hitting an all-time high of $2,483.60 on Wednesday. U.S. gold futures fell 1.2% to $2,426.10.

The Central Board of Direct Taxes (CBDT) on Thursday signed a multi-year contract with telecom major Bharti Airtel, under which the latter will provide network and connectivity solutions for CBDT's Taxnet-2.0 programme.

This contract is an extension as Airtel has been the network partner to CBDT since 2008 in Taxnet-1.0.

"The formal Letter of Award was handed over to Bharti Airtel by the Central Board of Direct Taxes (CBDT) and the Letter of Acceptance has been given by Bharti Airtel to CBDT. The occasion was graced by Mr. Sunil Bharti Mittal, Founder and Chairman, Bharti Enterprises, and Mr Ravi Agarwal, Chairman, CBDT," Airtel said in a statement. Read More

HDFC Bank, Kotak Mahindra Bank, RBL Bank, Yes Bank, Poonawalla Fincorp, Aarti Surfactants, Arihant Capital Markets, Can Fin Homes, Gravita India, JK Cement, Kirloskar Pneumatic, Motisons Jewellers, Netweb Technologies India, Rossari Biotech, Seshasayee Paper & Boards, Shakti Pumps, Sportking India, and Zenith Health Care will announce their quarterly results on July 20.

#1 Profit declines 23.8% to Rs 48 crore Vs Rs 63 crore, YoY

#2 Revenue rises 0.1% to Rs 783 crore Vs Rs 782 crore, YoY

The pharma company signed a non-exclusive patent licensing agreement with Takeda Pharmaceutical Company to commercialize Vonoprazan tablets in India. Vonoprazan is a novel, orally active potassium-competitive acid blocker (PCAB) used to treat reflux esophagitis and other acid peptic disorders.

#1 Delivered its strongest beat in 10 quarters in Q1 across revenue, margin & EPS

#2 FY 25 revenue guidance was raised to 3 percent to 4 percent YoY CC (from 1 percent to 3 percent)

#3 Deal momentum was strong at USD 4.1 billion TCV with net new of 57

#4 See beginning of an upcycle trend as growth recovers, BFSI inflects & ai deals scale up

Reliance Industries, Wipro, UltraTech Cement, Bharat Petroleum Corporation, JSW Steel, Union Bank of India, ICICI Lombard General Insurance Company, One 97 Communications (Paytm), Patanjali Foods, Aether Industries, Atul, BEML Land Assets, Blue Dart Express, CreditAccess Grameen, Fedbank Financial Services, Indian Hotels, JSW Energy, Jubilant Pharmova, Mahindra EPC Irrigation, Nippon Life India Asset Management, Oberoi Realty, Orissa Minerals Development Company, PVR Inox, Route Mobile, RPG Life Sciences, Supreme Petrochem, Stanley Lifestyles, Tejas Networks, Transformers and Rectifiers (India), and Vipul Organics will release their quarterly earnings on July 19.