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Benchmark equity indices closed lower as investors were concerned over the potential interest rate hike by the Fed and rise in international oil prices amid worsening situation in the Middle East. For the week, the Sensex fell 1.34% to end at 65,397.62 and the Nifty 50 index lost 1.06% to close at 19,542.65.
In broader markets, the BSE Midcap index shed 1.31% to close at 31,880.86 and the BSE Smallcap index inched up 0.04% to close at 38,198.72.
Top losers among Nifty sectoral indices were Realty [-2.19%], PSU Bank [-1.96%], Oil & Gas [-1.83%], Consumer Durables [-1.64%], and Metal [-1.58%]. Top gainers among Nifty sectoral indices were Auto [0.32%].
FIIs were net sellers worth Rs 2799.08 crore and DIIs were net buyers for Rs 3510.97 crore in cash segment during the week.
The Indian rupee rose 13 paise to close at 83.12 against the US dollar on Friday.
In international market, gold spot price rose to $1,981.4 as investors’ interest shifted to safe-haven assets. WTI Crude Oil prices stood at $88.75 per barrel and Brent Crude was at $92.16 per barrel.
Company News
HDFC Bank: The private sector lender has registered a standalone profit at Rs 15,976 crore for the quarter ended September FY24, up 50.6% over the year-ago period. Net interest income grew by 30.3% at Rs 27,385 crore during the reported quarter. Gross advances increased by around Rs 1.1 lakh crore YoY to Rs 23.54 lakh crore and total deposits stood at Rs 21.72 lakh crore at the end of September 2023.
Bajaj Finance: The NBFC has registered a 28% YoY rise in profit after tax at Rs 3,551 crore in Q2FY24. Net interest income in Q2FY24 jumped by 26% YoY to Rs 8,845 crore. The number of new loans booked increased by 26% to 85.3 lakh, while assets under management (AUM) grew 33% to Rs 2.9 lakh crore as of end of September 2023. Separately, Bajaj Finance has signed an agreement for acquisition of up to 26% equity stake in Pennant Technologies for a cash consideration of Rs 267.50 crore. The acquisition would be completed by December 30, 2023. Pennant Technologies is engaged in providing business-driven technology services and software products for the banking and financial services industry.
ITC: The company reported a 10.3% YoY rise in net profit at Rs 4,927 crore in Q2FY24. Revenue from operations increased 2.6% YoY to Rs 16,550 crore. Operating profit rose 1% YoY Rs 4,886.54 crore. Operating margin contracted by 44 basis points year-on-year to 29.53%. Cigarette business revenue grew 10% YoY to Rs 7,658 crore in Q2FY24, while the non-cigarette FMCG business revenue grew 8.3% on year to Rs 5,292 crore. Paper and paperboards business revenue declined 9.5% YoY year to Rs 2,070 crore, while its agriculture business reported a decline of 2% in revenue to Rs 3,931 crore.
UltraTech Cement: The company has reported a net profit of Rs 1,281 crore for the quarter ended September 2023, up 69% from Rs 756 crore in the same period last year. Revenue from operations during Q2FY24 rose 15% YoY to Rs 16,012 crore as against Rs 13,893 crore in the year-ago period. Ebitda for the reported quarter came in at Rs 2,498 crore, with margins of 15.9%. The cement major reported a robust volume growth of 16% for the quarter ended September 2023 and the domestic sales volume stood at 25.66 million tonnes, a 15% YoY rise.
Hindustan Unilever (HUL): The FMCG company recorded a 3.9% YoY in standalone profit at Rs 2,717 crore for the quarter ended September FY24. Standalone revenue from operations rose 3.6% YoY to Rs 15,276 crore for the quarter. Meanwhile, the board has approved an interim dividend of Rs 18 per share for the year.
One 97 Communications (Paytm): The fintech major has narrowed its losses to Rs 290 crore in Q2FY24, compared with Rs 571 crore in the year-ago period. Revenue from operations during the quarter under review jumped 32% YoY to Rs 2,518.6 crore as against Rs 1,914 crore in the year-ago period. The gross merchandise value (GMV) from the payments segment surged 41% YoY to Rs 4.5 lakh crore. The merchant paying subscriptions for devices reached 92 lakh at the end of the September quarter. In the loan distribution business, revenue from financial services and others increased 64% YoY to Rs 571 crore.
Tata Motors: Tata Motors and Freight Commerce Solutions Private Limited (‘Freight Tiger’) have signed a Securities Subscription Agreement (SSA) and a Shareholders Agreement (SHA) for the acquisition of 26.79% stake in ‘Freight Tiger’ for a consideration of Rs 150 Crores. The SSA also includes a provision enabling Tata Motors to further invest Rs 100 crore over the next two years, at the then prevailing market value.
Bajaj Auto: The two-wheeler manufacturer reported a standalone profit of Rs 1,836.1 crore in Q2FY24, up 20% YoY from Rs 1530 in the same period last fiscal. Its standalone revenue from operations rose 5.6% YoY to Rs 10,777.3 crore as against Rs 10,203 crore in the corresponding period last fiscal, supported by robust volume growth and strong domestic demand. Ebitda stood at Rs 2133 crore, up 21% YoY and margin stood at 19.8%, up 260 basis points.
IndusInd Bank: The private sector lender recorded a standalone profit of Rs 2,181.5 crore for the quarter ended September 2023, up 22.09% YoY, helped by a decline in provisions and stable asset quality. Net interest income grew by 18% YoY to Rs 5,076.7 crore during the same period, while net interest margin remained flat at 4.29% QoQ but grew 5 basis points YoY.
Wipro: The IT services firm recorded a consolidated net profit of Rs 2,667.3 crore for the quarter ended September 2023, up 0.70% YoY. The IT major’s profit stood at Rs 2,649.10 crore in the corresponding quarter of last fiscal. The consolidated revenue from operations for the quarter under review stood at Rs 22,515.90 crore, down 0.10% from Rs 22,539.70 crore in the year-ago period. The company expects revenue from the IT Services business segment to be in the range of $2,617 million to $2,672 million, which is a sequential guidance of -3.5% to -1.5% in constant currency terms. The IT major’s board approved the merger of its five wholly owned subsidiaries into self.
L&T Technology Services (LTTS): The company has registered a 1.4% QoQ rise in net profit at Rs 315.4 crore for the quarter ended September FY24. Revenue for the quarter increased by 3.7% QoQ to Rs 2,386.5 crore, with dollar revenue increasing by 2.9% to $288.1 million. The company’s board declared an interim dividend of Rs 17 per equity share.
Nestle India: The FMCG major said that its consolidated net profit surged 37% YoY to Rs 908.1 crore for the quarter ended September 2023. The net profit stood at Rs 661.4 crore in the same period last year. Revenue from operations stood at Rs 5,036.82 crore in the reported quarter, up 9.4% YoY. The company announced a second interim dividend of Rs 140 per share that will be paid on or before November 16. The total payout will amount to Rs 1,349.82 crore. The company has fixed November 1 as the record date for determining the eligibility of shareholders. Further, the board has approved splitting the existing equity shares having face value of Rs 10 per share into 10 equity shares having face value of Re 1 per share.
L&T Finance Holdings: The financial services company reported a 46% YoY growth in net income at Rs 595 crore for the September quarter, helped by strong loan sales in the retail segment. The company achieved quarterly retail disbursements of Rs 13,499 crore, up 32% YoY. Gross NPA fell to 3% during the reported quarter from 3.82% in the smae period last fiscal. Net interest income rose 11% to Rs 1,729 crore as net income from retail loans stood at Rs 606 crore, up 86%. Retail loan book rose 33% YoY to Rs 69,417 crore.
JSW Energy: The company posted an 82% increase in its consolidated net profit at Rs 850 crore for the quarter ended September 2023 as against a net profit of Rs 466 crore in the corresponding period of previous year. Total revenue increased 30% YoY to Rs 3,387 crore in Q2FY24 from Rs 2,596 crore in the year-ago period. Net power generation during the quarter under review stood at 8,638 million units, up 29% YoY, driven by generation at acquired renewable energy portfolio and higher thermal generation.
Economy News
India’s wholesale price index (WPI) based inflation stood at -0.26% in September compared to -0.52% in August and 10.55% in the year-ago period. The latest reading in September showed that WPI-based inflation remained negative for the sixth consecutive month. Further, wholesale food prices rose 1.54% year-on-year compared with a rise of 5.62% in August. Manufactured product prices fell 1.34% as against a 2.37% decline in the previous month.
Global Markets
Major equity indices in the US closed lower as investors’ sentiments were dampened due to worries that the interest rates would remain higher for an extended period of time amid elevated inflation. For the week, the S&P 500 tumbled 2.39%, the Dow fell 1.61% and the Nasdaq tanked 3.16%. The yield on the 10-year US Treasury note nearly touched 5% in intraday trading during the week, its highest since 2007.
On the economic front, the Commerce Department reported that retail sales rose 0.7% month-on-month in September. Over the preceding 12 months, retail sales increased 3.8% in September. Meanwhile, weekly jobless claims fell to 198,000, lowest level since January. Building permits fell 4.4% to a rate of 1.473 million units in September.
The Federal Reserve released the Beige Book on October 18. The report is published eight times a year and talks about the current US economic conditions across the 12 Federal Reserve Districts. The report said most districts indicated little to no change in economic activity since the September report.
Consumer spending was mixed, especially among general retailers and auto dealers, due to differences in prices and product offerings. Tourism activity continued to improve and a few districts noted an uptick in business travel. Banking contacts reported slight to modest declines in loan demand. Real estate conditions were little changed and the inventory of homes for sale remained low. The report said the near-term outlook for the US economy was generally described as stable or having slightly weaker growth.
Japan’s stock markets fell during the week, with the Nikkei 225 index tumbling 3.3% and the broader Topix index losing 2.3%. The 10-year Japanese government bond yield rose to 0.83%, its highest level in a decade, from 0.76% at the end of the preceding week. The Japanese Yen depreciated during the week and inched near the JPY 150 levels. Meanwhile, Japan’s inflation rate slowed in September, with the core consumer price index rising 2.8% on an annualized basis, down from 3.1% in August.
Chinese markets declined due to concerns over worsening property sector despite better-than-expected gross domestic product data. The Shanghai Composite index declined 3.4%, the CSI 300 plummeted 4.17%, and the Hang Seng index plunged 3.6%.
On the economic front, China’s GDP rose 4.9% in the third quarter compared to same period a year earlier, slowing from the 6.3% rise recorded in the second quarter. On a quarterly basis, the economy grew 1.3%, up from the second quarter’s 0.5% growth. Retail sales rose 5.5% in September from a year earlier, compared to a rise of 4.6% in August 2023.
Meanwhile, Country Garden, one of the largest property developer in China, said that it was unable to pay all its offshore debt payments, highlighting the trouble in China’s real estate market.