Sensex, Nifty pare gains; Auto stocks fall

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Key equity indices BSE Sensex and NSE Nifty reversed gains and hit fresh intraday low in mid-afternoon trade. Auto shares corrected for second consecutive session. At 14:28 IST, the barometer index, the S&P BSE Sensex, was down 16.62 points or 0.03% to 51,514.90. The Nifty 50 index lost 16.30 points or 0.11% to 15,157.

The broader market declined. The S&P BSE Mid-Cap index shed 0.26%. The S&P BSE Small-Cap index 0.19%.

Buyers outpaced sellers. On the BSE, 1347 shares rose and 1552 shares fell. A total of 164 shares were unchanged.

Investors booked profits after recent steep gains. Domestic shares have rallied sharply since January 2021 following a range of positive developments, including a high-spending union budget, strong corporate earnings, robust foreign fund flows and progress on COVID-19 vaccinations.

Numbers to Track:

In the foreign exchange market, the partially convertible rupee appreciated to 72.82 compared with its previous closing of 72.87.

The yield on 10-year benchmark federal paper rose to 5.978% from its previous closing of 5.962%.

MCX Gold futures for 5 April 2021 settlement slipped 0.50% to Rs 47,269.

The US Dollar index (DXY), which tracks the greenback’s value against a basket of currencies, rose 0.19% to 90.59.

In the commodities market, Brent crude for April 2021 settlement lost 59 cents to $60.55 a barrel. The contract declined 0.54% or 33 cents to settle at $61.14 in the previous trading session.

Buzzing Index:

The Nifty Auto index declined by 0.73% to 10,885.55, extending losses for second day. The index has corrected 1.14% in two days.

Ashok Leyland (down 5.26%), Bajaj Auto (down 1.10%), Maruti Suzuki (down 1.12%), Eicher Motors (down 1.06%), Mahindra & Mahindra (down 0.70%), Hero MotoCorp (down 0.83%), TVS Motor Company (down0.48%) and Tata Motors (down 0.15%) declined.

Earnings Impact:

Voltas fell 3.39% to Rs 1063.75. On a consolidated basis, the air conditioning company’s net profit jumped 46.2% to Rs 128.64 crore on 32.5% rise in revenue from operations to Rs 1970 crore in Q3 FY21 over Q3 FY20.

The company’s cooling products business made good recovery, post easing of the lockdown situation and achieved a record overall volume growth of 40% to Rs 840 crore, contributed by 43% increase in the sales volume of room Air conditioners (ACs), 100% in commercial refrigeration products and 11% in Air Coolers.

The electro-mechanical projects and services revenue for the quarter was higher by 26% to Rs 1017 crore in Q3 FY21 as compared to Rs 808 crore in the corresponding quarter last year. Carry forward order book of the segment was higher at Rs 7275 crore as compared to Rs 7024 crore in the corresponding quarter last year.

The engineering products and services segment Revenue and result for the quarter were at Rs 121 crore and Rs 32 crore as compared to Rs 83 crore and Rs 23 crore, respectively in the corresponding quarter last year.

Bharat Forge slumped 2.82% to Rs 629.85 after the company reported a consolidated net loss of Rs 210.44 crore in Q3 FY21 as against a consolidated net profit of Rs 40.43 crore in Q3 FY20. Consolidated revenue from operations fell nearly 6% to Rs 1723.11 crore in Q3 FY21 from Rs 1830.85 crore posted in Q3 FY20. EBITDA margins improved by 520 basis points to 18.1% Q3 FY21 from 12.9% in Q3 FY20.

The auto maker reported an exceptional one-time loss of Rs 299.45 crore which impacted company’s profits. During the quarter ended 31 December 2020, Germany’s National Competition regulator (Federal Cartel Office)(FCO) concluded the settlement with the company’s German subsidiaries. Accordingly, an amount of Rs 274.26 crore has been provided for in the quarter ended 31 December 2020 in consolidated results towards such settlement including related expenses. The settlement amount will be paid over the period of next five years.

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