The benchmark indices advanced for the second trading session on Wednesday, tracking positive global cues. The Nifty reclaimed 14,600 mark. Global shares were buoyant ahead of Joe Biden's inauguration as US president. Washington gets set to try for another massive round of stimulus for the economy.
The S&P BSE Sensex, surged 393.83 points or 0.80% at 49,792.12. The Nifty 50 index soared 123.55 points or 0.85% at 14,644.70. Both the indices attained record closing high levels.
The Sensex hit a record high of 49,874.42 while the Nifty hit a record high of 14,666.45 in late trade today.
Reliance Industries (up 1.91%), Infosys (up 1.70%), HDFC (up 1.28%) and TCS (up 1.32%) were major market movers.
In the broader market, the BSE Mid-Cap index rose 1.08% and the BSE Small-Cap index added 0.58%.
Buyers outnumbered sellers. On the BSE, 1541 shares rose and 1473 shares fell. A total of 161 shares were unchanged.
COVID-19:
Total COVID-19 confirmed cases worldwide stood at 9,61,58,807 with 20,57,050 deaths. India reported 1,97,201 active cases of COVID-19 infection and 1,52,718 deaths while 1,02,45,741 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
Separately, World Health Organisation (WHO) said that United Kingdom COVID-19 strain has been detected at least 60 countries.
Economy:
The Reserve Bank of India (RBI) on Tuesday identified State Bank of India (up 1.32%), ICICI Bank (up 0.82%) and HDFC Bank (down 0.83%) as Domestic Systemically Important Banks (D-SIBs), under the same bucketing structure as in the 2018 list of D-SIBs. The additional Common Equity Tier 1 (CET1) requirement for D-SIBs was phased-in from April 1, 2016 and became fully effective from April 1, 2019. The additional CET1 requirement will be in addition to the capital conservation buffer. The Reserve Bank had issued the Framework for dealing with Domestic Systemically Important Banks (D-SIBs) on July 22, 2014. The D-SIB framework requires the Reserve Bank to disclose the names of banks designated as D-SIBs starting from 2015 and place these banks in appropriate buckets depending upon their Systemic Importance Scores (SISs).
Numbers to Watch:
The yield on 10-year benchmark federal paper rose to 5.943% as compared with 5.936% at close in the previous trading session.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 73.05, compared with its close of 73.17 during the previous trading session.
In the commodities market, Brent crude for March 2021 settlement rose 36 cents at $56.26 a barrel. The contract rose 80 cents, or 1.45% to settle at $55.90 a barrel in the previous trading session.
Foreign Markets:
European stocks were trading higher on Wednesday, ahead of the inauguration of President-elect Joe Biden.
Most Asian indices closed higher on Wednesday as investors reacted to the release of China's latest benchmark lending rate. The moves in Chinese stocks came as the one-year prime rate (LPR) and five-year LPR in China were both left unchanged at 3.85% and 4.65%, respectively.
US stocks climbed on Tuesday as investors digested results from the new earnings season as well as signals for another big stimulus and faster pace of vaccine distribution ahead.
Janet Yellen, President-elect Joe Biden's designated nominee for Treasury Secretary and a former chair of the Federal Reserve, appeared before the Senate Finance Committee on Tuesday. Yellen called for the federal government to enact a large stimulus to help the economy.
Biden, set to be inaugurated on Wednesday, unveiled his $1.9 trillion plan for economic relief last week as the country tries to get a handle on the COVID-19 pandemic.
Primary Market:
The initial public offer (IPO) of Indian Railway Finance Corporation (IRFC) received bids for 428.96 crore shares as against 124.75 crore shares on offer, according to the stock exchange data at 16:45 IST. The issue was subscribed 3.44 times.
The issue opened for subscription on 18 January and it will close on today (20 January). The price band for the IPO is set at Rs 25-26 per share. An investor can bid for minimum of 575 equity shares and in multiples thereof. The stock will list on 2 February 2021 on bourses.
The IPO consists of fresh issue of up to 118.80 crore equity shares and an offer of sale of up to 59.40 crore equity shares by the Government of India. Post issue, the government shareholding in the company will fall to 86.4%. The company proposes to utilize the net proceeds from the offer for augmenting equity capital base to meet future capital requirements arising out of growth in business.
The IPO of Indigo Paints received bids for 1.04 crore shares as against 55.18 lakh shares on offer on Wednesday (20 January 2021), according to the stock exchange data at 17:00 IST. The issue was subscribed 1.90 times.
The issue opened for subscription on Wednesday (20 January 2021) and it will close on Friday (22 January 2021). The price band for the IPO is set at Rs 1488-1490 per share. An investor can bid for minimum of 10 equity shares and in multiples thereof.
The IPO consists of fresh issue of equity shares aggregating to Rs 300 crore and an offer of sale of up to 58.40 lakh equity shares by the selling shareholders.
Earnings Impact:
Bajaj Finance rose 0.41%. The company reported a 29% drop in consolidated net profit to Rs 1145.98 crore on a 5.2% fall in total income to Rs 6658.47 crore in Q3 December 2020 over Q3 December 2019. The NBFC's profit before tax stood at Rs 1,554.51 crore in Q3 December 2020, a 28.3% decline over Rs 2170 crore posted in Q3 December 2019. Total tax expense declined 26.5% to Rs 408.53 crore in Q3 December 2020 over Q3 December 2019.
Net Interest Income (NII) fell 5.27% year-on-year to Rs 4,296 crore in Q3 December 2020 over Q3 December 2019. This was predominantly due to higher reversal of interest income at Rs 450 crore versus Rs 83 crore in Q3 FY20 and higher cost of liquidity surplus at Rs 213 crore versus Rs 83 crore in Q3 FY20.
HDFC Asset Management Company (HDFC AMC) fell 0.03%. The company's net profit rose 5% to 369.40 crore on 1% increase in total income to Rs 595 crore in Q3 FY21 over Q3 FY20. Profit before tax (PBT) rose 4% to 482.80 crore during the period under review. Total expenses fell 11% YoY to 112.20 crore in Q3 FY21. Total AUM as of 31 December 2020 at Rs 4,06,800 crore, a year on year increase of 10%.
The operating profit of the company for the quarter ended 31 December 2020 was Rs 369.70 crore. While this is 7% lower than the operating profit of Rs 398.70 crore for the quarter ended 31 December 2019, it is 6% higher than the operating profit of Rs 349.10 crore for the quarter ended 30 September 2020.
Federal Bank was up 2.52%. The private lender reported 8.29% decline in net profit to Rs 404.10 crore on 5.43% rise in total income to Rs 3,941.36 crore in Q3 FY21 over Q3 FY20. Profit before tax in Q3 FY21 stood at Rs 542.28 crore, down by 6.98% from Rs 582.96 crore in Q3 FY20. Tax expense declined by 2.91% year-on-year (YoY) to Rs 138.18 crore. Operating profit increased by 29.45% to Rs 962.90 crore in Q3 December 2020 from Rs 743.82 crore in Q3 December 2019.
Hindustan Zinc fell 0.95%. The company reported 35.80% jump in net profit to Rs 2,200 crore on a 27.86% increase in revenue from operations to Rs 5,915 crore in Q3 FY21 over Q3 FY20. The company said that the increase in revenue was led by higher metal volumes, higher zinc & silver prices and rupee depreciation partly offset by lower lead prices. Zinc volumes increased by 6% year-on-year (YoY) and lead by 30% YoY in line with higher production and robust demand. EBITDA for the quarter soared to Rs 3,314 crore, up 45% YoY and 12% sequentially on account of higher revenue and well managed operating costs.
Larsen & Toubro Infotech (LTI) rose 0.17%. The IT company's consolidated net profit increased by 13.7% to Rs 519.3 crore in Q3 FY21 from Rs 456.8 crore in Q2 FY21. Revenue during the quarter rose by 5.1% to Rs 3,152.8 crore in Q3 December 2020 from Rs 2,998.4 crore in Q2 September 2020. In dollar terms, the company's increased 5.8% on a quarter-on-quarter (QoQ) basis to $427.8 million. Sequential constant currency revenue growth was 5.3% in the quarter ended December 2020. EBIT rose 9.1% to Rs 650.2 crore in Q3 December 2020 from Rs 595.7 crore in Q2 September 2020. EBIT margin was at 20.6% as on 31 December 2020 as against 19.9% as on 30 September 2020.
Tata Steel BSL added 0.69% crore after the company reported a consolidated net profit of Rs 913.19 crore in Q3 FY21 compared with net loss of Rs 501.50 crore in Q3 FY20. Net sales during the quarter rose 16.1% year-on-year (YoY) to Rs 5,501.20 crore. Total expenditure dropped 10.6% to Rs 4,256.75 crore while the interest outgo declined by 14.5% to Rs 360.93 crore in Q3 December 2020 over Q3 December 2019.
TV18 Broadcast fell 1.42%. TV18 Broadcast's consolidated net profit surged 83.9% to Rs 377.20 crore on 4.5% decrease in net sales to Rs 1,360.95 crore in Q3 December 2020 over Q3 December 2019. Profit received a boost from improved performance, lower finance costs & tax reversals. Consolidated profit before tax (PBT) jumped 21.6% to Rs 293.66 crore in Q3 December 2020 as against Rs 241.47 crore in Q3 December 2019. Tax rebate for the quarter stood at Rs 102.41 crore as against a tax expenditure of Rs 36.31 crore in Q3 December 2019. Consolidated operating EBITDA grew 14% to Rs 321 crore in Q3 December 2020 over Rs 281 crore in Q3 December 2019. Operating EBITDA margin improved to 23.6% in Q3 FY21 as against 19.7% in Q3 FY20.
Skipper fell 1.08%. The company reported 147.3% jump in consolidated net profit to Rs 11.45 crore on 52.97% surge in total income to Rs 460.82 crore in Q3 December 2020 over Q3 December 2019.
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