Topics Nifty50 | NSE Nifty50 benchmark index | Lockdown
Key Highlights
- All banks missed estimates as they set aside more money to save themselves against big loan losses from the pandemic.
- Two of the five Nifty 50-listed tech firms posted disappointing earnings as lockdowns lead to payment delays and requests for discounts. Most of the major tech firms joined businesses globally to drop guidance.
- Reliance Industries Ltd. -- the index’s largest stock -- announced a profit plunge of almost 40% from a year earlier.
- Bharti Airtel Ltd., the mobile carrier that lost its position as India’s No. 1 to an upstart, reported a loss of 52.4 billion rupees ($694 million) -- its fourth straight quarter of losses.
- Materials stocks, particularly cement companies such as UltraTech Cement Ltd. and Shree Cement Ltd., had the largest gain in profits among Nifty 50 members. Health care and consumer staples were the only other sectors to record growth.
- Bajaj Finserv Ltd. has the steepest net income decline.
Analyst Comments
- Analysts expect telecommunications and consumer staples to outperform as the economy reopens, while a slump in capital expenditure and discretionary spending hurts related sectors for the time being.
- “The outlook for June is quite uncertain due to Covid-19 as both supply side and demand side issues will mar both topline and bottomline,” said Abhimanyu Sofat, head of research at IIFL Securities Ltd.
- The Nifty is at an “important” level right now of about 10,000, he said. “As the lockdown starts opening up we see a change in leadership to insurance, rural and telecommunication stocks.”
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