MARKET WRAP: Sell-off continues, Sensex tumbles 306 pts as financials drag

Extending their losing streak to the third session in a row, the domestic stock market ended lower on Monday with the frontline indices tumbling nearly a per cent amid selling in bluechip counters such as HDFC duos, Bajaj Finance, Hindustan Unilever (HUL) and ITC.

The S&P BSE Sensex lost 306 points or 0.80 per cent to settle at 38,031 with HDFC (down 5 per cent) being the biggest loser and YES Bank (up nearly 9.50 per cent) the top gainer. The broader Nifty50 index of the National Stock Exchange (NSE) slipped 82 points or 0.72 per cent to settle at 11,337 levels. 

In the broader market, the S&P BSE MidCap index slipped 84 points, or 0.60 per cent, to 13,994.18, while the S&P BSE SmallCap index ended at 13,157 levels, down 154 points or 1.15 per cent. The S&P BSE Smallcap index hit its lowest level since February 2017 during the trade. READ MORE

Analysts attributed an investor-unfriendly Budget, coupled with muted June quarter earnings among the major factors behind nervousness in the market. Moreover, weak global cues also added to the investors' woes. 

Volatility index India VIX surged 4.49 per cent to 13.07, signalling increased volatility in the market. 

Sectorally, financial services stocks tumbled the most, followed by banks, FMCG and realty stocks. The Nifty Financial Services index shed 341 points or 2.57 per cent to settle at 12,893.75 levels. HDFC, Bajaj Finserv and Edelweiss Financial Services plunged up to 6 per cent.

BUZZING STOCKS

Shares of Cox & Kings were frozen at 5 per cent lower circuit for the 19th straight day on the BSE to hit a new low of Rs 16.30 on Monday after Brickwork Ratings downgraded the rating to BWR D for non convertible debentures (NCDs) issue amounting to Rs 50 crore of the company. 

Shares of RBL Bank continued to reel under pressure, down 5 per cent, to Rs 470 in intra-day trade on Monday. The stock has fallen 19 per cent in the past two trading days after the bank, on Friday, said it expects some challenges on some of their exposures in the near term. Shares of the bank ended at Rs 478.05 apiece, down 4.46 per cent on BSE. 

YES Bank, on the other hand, gained 9.50 per cent to settle at Rs 91.15 apiece on the BSE.  

GLOBAL CUES

Asia stocks fell on Monday as investors scaled back expectations of an aggressive interest rate cut by the Federal Reserve, while heightened Middle East tensions following Iran’s seizure of a British tanker lifted crude oil prices.

MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.4%. Japan’s Nikkei fell 0.3% while China's Shanghai Composite Index lost 1.1%. Hong Kong’s Hang Seng dropped 0.9%. South Korea’s KOSPI shed 0.1%. 

(With inputs from Reuters)

3:48 PM IST

3:48 PM IST

3:26 PM IST We have cut earnings estimates for FY20/21E by 25/19% to factor higher slippages and consequent provisions. A fund raise is still possible, and will be crucial for RBL to provide for the upcoming stress and maintain growth rates. We are factoring Rs 35bn (at Rs 500/sh), pushing up est. ABVs by 27/20% over FY20/21E. Guidance on stress, and concentration commentary are red flags that underpin our DOWNGRADE to NEUTRAL. We value RBL at 2x Jun-21E ABV (vs. 3x earlier). Our TP is Rs 512. 

2:58 PM IST

2:51 PM IST -- Net profit up 35% at Rs 113.5 cr YoY -- Revenue up 7.1% at Rs 788 cr YoY -- Ebitda up 21.9% at Rs 165.3 cr YoY -- Ebitda margin at 21% vs 18.4% YoY

2:34 PM IST

2:26 PM IST

2:09 PM IST In the past one month, the stock has tanked 73 per cent, as compared to a three per cent decline in the S&P BSE Sensex. Thus far in the calendar year, it has plunged 90 per cent from level of Rs 167, against a six per cent rise in the benchmark index. READ MORE  

2:07 PM IST Since the presentation of the Budget earlier this month, the S&P BSE Sensex and the Nifty50 have lost around five per cent each. In comparison, the S&P BSE Smallcap index has lost 8.5 per cent. The index hit an intra-day low of 13,089 points, its lowest level since February 1, 2017, on the BSE. From the recent high on April 14, 2019, the smallcap index has tanked 13 per cent, as against 10 per cent fall in the midcap and three per cent cut in the benchmark index. READ MORE

1:48 PM IST -- Net profit at Rs 112.7 cr vs loss of Rs 393.2 cr YoY -- Gross NPA at 12.56% vs 12.66% QoQ -- Net NPA at 5.91% vs 5.93% QoQ -- NII up 2.6% at Rs 1371.6 cr vs 1337.3 cr YoY  

1:47 PM IST

1:41 PM IST INDIGO 1,520.90 +57.55 +3.93 KRBL 210.30 +9.35 +4.65   YESBANK 87.20 +3.95 +4.74   AVANTI 334.40 +20.65 +6.58   SPARC 162.90 +11.80 +7.81  

LIVE UPDATES

Sectoral gainers and losers on the NSE


Top losers and gainers on the S&P BSE Sensex


HDFC Securities on RBL Bank

We have cut earnings estimates for FY20/21E by 25/19% to factor higher slippages and consequent provisions. A fund raise is still possible, and will be crucial for RBL to provide for the upcoming stress and maintain growth rates. We are factoring Rs 35bn (at Rs 500/sh), pushing up est. ABVs by 27/20% over FY20/21E. Guidance on stress, and concentration commentary are red flags that underpin our DOWNGRADE to NEUTRAL. We value RBL at 2x Jun-21E ABV (vs. 3x earlier). Our TP is Rs 512. 

MARKET CHECK


GSK Pharma Q1 results

-- Net profit up 35% at Rs 113.5 cr YoY
-- Revenue up 7.1% at Rs 788 cr YoY
-- Ebitda up 21.9% at Rs 165.3 cr YoY
-- Ebitda margin at 21% vs 18.4% YoY

HIndustan Unilever dips over 3%


Nifty PSU Bank index off day's lows


Cox & Kings slips to new low, hits lower circuit for 19th straight day

In the past one month, the stock has tanked 73 per cent, as compared to a three per cent decline in the S&P BSE Sensex. Thus far in the calendar year, it has plunged 90 per cent from level of Rs 167, against a six per cent rise in the benchmark index. READ MORE

 

Small-caps tumble: BSE Smallcap index hits lowest level since February 2017

Since the presentation of the Budget earlier this month, the S&P BSE Sensex and the Nifty50 have lost around five per cent each. In comparison, the S&P BSE Smallcap index has lost 8.5 per cent. The index hit an intra-day low of 13,089 points, its lowest level since February 1, 2017, on the BSE. From the recent high on April 14, 2019, the smallcap index has tanked 13 per cent, as against 10 per cent fall in the midcap and three per cent cut in the benchmark index. READ MORE

Oriental Bank of Commerce Q1 results

-- Net profit at Rs 112.7 cr vs loss of Rs 393.2 cr YoY
-- Gross NPA at 12.56% vs 12.66% QoQ
-- Net NPA at 5.91% vs 5.93% QoQ
-- NII up 2.6% at Rs 1371.6 cr vs 1337.3 cr YoY
 

Srikalahasthi Pipes surges 5% as PAT in June qtr zooms 93%


MARKET CHECK | Top 5 gainers on BSE at this hour

INDIGO 1,520.90 +57.55 +3.93
KRBL 210.30 +9.35 +4.65
 
YESBANK 87.20 +3.95 +4.74
 
AVANTI 334.40 +20.65 +6.58
 
SPARC 162.90 +11.80 +7.81
 

Nifty Pharma index rises 1% higher amid subdued trade


Indiabulls Real cracks over 7%


Heatmap: S&P BSE Sensex


Edelweiss Securities on Dhanuka Agritech

With no change in guidance and our industry outlook, we maintain our estimates. We continue to value Dhanuka Agritech at 16x September 2020 P/E yielding TP of Rs 469. The stock, in our view, offers limited downside from the current valuation and given its strong return profile (ROCE amongst the highest) we envisage valuations to improve once growth improves. Hence, we maintain ‘BUY’.

Reliance Securities on HDFC Bank

We believe the bank is well positioned to deliver healthy growth even in the current weak environment. Its strong capital position, improving operating efficiency and impeccable asset quality performance across cycles should continue to aid return ratios with RoA/RoE pegged at 1.9%/16% for FY21E. At CMP, the stock trades at multiple of 3.4x FY21E. Marginally tweaking our earnings estimates for FY20E/FY21E, we maintain our BUY recommendation on the stock with an SOTP-based Target Price of Rs2,650 (based on 3.7x FY21E adjusted PBV and the value of its subsidiaries, implying a FY21 P/ABV of 3.8x). 

Ceramic Sector Note by Equirus Securities

The Indian ceramic industry (tiles + bath-ware) should see better growth once RERA-induced consolidation in the real estate industry stabilizes and demand recovers. Stricter E-way implementation should lead to increased compliance costs for unorganized players and reduce the organized-unorganized pricing differential, leading to gradual market share gains for larger branded players. Additionally, with industry focus now shifting to improving capacity utilization, increase in production costs for unorganized players (due to higher tax compliance, stretched WC cycles), pricing pressure should remain subdued; this should lead to stable avg. realizations in the near term, offering margin stability for Kajaria and Somany.

Cement stocks trade under pressure

COMPANY LATEST(rs) CHG(rs) CHG(%) VOLUME
MEGHMANI ORGAN. 55.10 1.10 2.04 44942
UPL 639.35 -4.85 -0.75 36941
RALLIS INDIA 153.90 -0.65 -0.42 17199
P I INDS. 1059.55 -32.10 -2.94 2666
DHANUKA AGRITECH 379.25 -9.95 -2.56 743

Brokerages remain upbeat on Reliance Industries' stock post Q1 results

Most brokerages remain upbeat on Reliance Industries Limited (RIL), after the company posted a 7 per cent jump in its net profit for the April – June quarter of financial year 2019 – 20 (Q1FY20) at Rs 10,104 crore. The company announced its numbers for the recently concluded quarter post market hours on Friday. Revenue came in 22.1 per cent higher than the Rs 1.41 trillion in the corresponding period a year ago. Gross refining margin (GRM) for the quarter came in at $8.10/barrel. READ MORE

Nifty sectoral indices at this hour


Stocks that hit 52-week low on S&P BSE Sensex

COMPANY PRICE(rs) 52 WK LOW CHG(rs) CHG(%)
ANDHRA BANK 21.85 21.70 -0.35 -1.58
APOLLO TYRES 174.60 172.70 -0.20 -0.11
ASAHI INDIA GLAS 200.35 199.45 -1.00 -0.50
AUROBINDO PHARMA 569.35 546.00 17.05 3.09
BAJAJ CONSUMER 292.65 289.15 -6.95 -2.32
» More on 52 Week Low

MARKET CHECK


DHFL off day's high


RBL Bank tanks 19% in two days on weak FY20 guidance

Shares of RBL Bank continued to reel under pressure, down 5 per cent, to Rs 470 in intra-day trade on Monday. The stock has fallen 19 per cent in the past two trading days after the bank, on Friday, said it expects some challenges on some of their exposures in the near term. The private sector bank's stock had recorded its sharpest single-day fall of 14 per cent on Friday since listing on the bourses on August 31, 2018. READ MORE

Just Dial cracks 7% ahead of June quarter earnings


Zee Entertainment rises 3%


HDFC group shares fall on profit-booking; HDFC, HDFC Bank slip up to 4%

Shares of HDFC group companies on Monday came under pressure, falling by up to 6 per cent on the BSE in the early morning trade on profit-booking. Housing Development Finance Corporation (HDFC), HDFC Bank, HDFC Asset Management Company (AMC) and HDFC Life Insurance were down in the range of 2 per cent to 6 per cent on the BSE. In comparison, the S&P BSE Sensex was down 0.79 per cent at 38,034 level at 10:04 am. READ MORE

Edelweiss Financial down over 4.5%


Preventive testing, Ayushman Bharat to drive diagnostic firms' revenues

While the Street is cautious on the outlook for segments within the health care space such as pharmaceuticals, one segment which is expected to buck the trend on growth and revenue outlook is diagnostics services. Diagnostic services companies led by Dr Lal Pathlabs and the recently listed Metropolis Healthcare have outperformed the market and this trend is expected to sustain. READ MORE

Bajaj Finance hits two-month low, down 8% in two days

Bajaj Finance shares hit a two-month low of Rs 3,191, down 4 per cent in Monday's early morning trade on the BSE, and was the biggest loser among S&P BSE Sensex and Nifty50 stocks at 9:30 am. The stock has fallen 8 per cent in two trading days on slowdown concerns. It is trading at its lowest level since May 17 and has corrected 15 per cent from its all-time high level of Rs 3,761 touched on July 5. READ MORE

YES Bank climbs over 4%


MARKET CHECK


Mahindra CIE tanks 9% post June quarter results


Suzlon dips 4.3% after Union Bank of India tags co as 'bad loan'


Most active stocks by volume

COMPANY PRICE(rs) CHG(rs) CHG(%) VOLUME
REL. COMM. 1.76 -0.03 -1.68 2341729
YES BANK 84.60 1.35 1.62 1229819
DEWAN HSG. FIN. 52.65 -0.70 -1.31 1099054
SPICEJET 142.40 1.40 0.99 812400
SUZLON ENERGY 4.17 -0.20 -4.58 473941
» More on Most Active Volume

Amara Raja Batteries trades higher after reporting 2% growth in Q1


TVS Motor faces selling pressure ahead of June quarter results today


Bajaj Finance cracks over 3%, top loser on S&P BSE Sensex


Nifty Bank index is trading 1 per cent lower


Vedanta gains 3% in early trade, top gainer in BSE Sensex


Result impact: Reliance Industries trades in the green


Result impact: HDFC Bank slides 1.8%


Sectoral gainers and losers on the NSE


First Trade | Top gainers and losers on the S&P BSE Sensex


Rupee opening

Rupee opens lower at 68.90/$ vs Friday's close of 68.80 against the US dollar

Stocks to watch

Suzlon Energy: Public sector lender Union Bank of India has tagged Suzlon Energy as a bad loan and more banks are expected to follow suit as the stressed wind turbine maker has struggled to repay its lenders, Mint reported citing sources.
 
RIL: Reliance Industries Ltd (RIL) on Friday reported a 6.8 per cent increase in its net profit at Rs 10,104 crore for the quarter ended June this year on the back of a record 22 per cent jump in revenue at Rs 1.72 trillion. Besides, the company on Friday informed that Reliance Industrial Investments and Holdings had signed an agreement with BIF IV Jarvis India Pte, a unit of Brookfield Asset Management, for an investment by Brookfield (along with co-investors) for Rs 25,215 crore in units issued by the Tower Infrastructure Trust. READ MORE

Q1 results: Net profit of 113 firms up 10.8%, sales growth at 10-qtr low

The earnings season for the April-June 2019 quarter has started on a slow note for Corporate India, with early birds reporting a slowdown — both in top line and bottom line growth. The combined net profit of 113 companies that have declared their results for the first quarter (Q1) of 2019-20 (FY20) so far was up 10.8 per cent year-on-year (YoY), down from 12.7-per cent YoY growth reported during the fourth quarter of 2018-19 and 13.5 per cent growth a year ago. READ MORE

IndiGo to expand board to 10 directors, promoters yet to make peace

After more than 10 hours of deliberation spread over days, a decision has been taken to expand the IndiGo board to 10 directors. Four of them will be independent directors. Currently, it’s a six-member board, including two independent directors. The contours of the IndiGo board and the number of directors have been a contentious issue with co-promoter Rakesh Gangwal pointing at corporate governance lapses in the company. READ MORE

Etihad, Hinduja Group back at the deal table for grounded Jet Airways

The names of Etihad Airways and Hinduja Group have resurfaced as contenders for submitting a joint expression of interest (EoI) to revive Jet Airways, which is facing insolvency proceedings. Even before Jet had landed up at the National Company Law Tribunal (NCLT), Etihad and Hindujas were in the fray to invest in the grounded airline but subsequently they opted out. READ MORE

Bet on well-managed NBFCs

The recent developments around the Insolvency and Bankruptcy Code (IBC) will impact investors in various ways. The Essar Steel case led to some consternation for financial creditors. The original allocation of funds from the Rs 42,000 crore offer by ArcelorMittal meant that financial creditors would have recovered over 90 per cent of their claimed dues. READ MORE

Top trading ideas by CapitalVia

Sell TVS Motors July Future
 
Entry: 390.90
Target:334.80
Stop Loss: 425.10

Overall, the Auto index is in continuous downtrend and has already fallen more than 5 per cent this month. TVS Motors is trading below its 100 & 200-WEMA. On the other hand, the stock was trading in a channel formation from last couple of months and now has given a breakdown below its channel support. MACD is also showing that negative divergence can persist further as there is a negative crossover in the daily chart. READ MORE

Nifty outlook, top stock picks by Angel Broking

TATA GLOBAL
 
View – Bearish
Last Close – Rs 248.85
 
Justification – Since May lows, this stock has already given a stupendous rally and since the Budget day, we are witnessing some nervousness in the counter. Due to Friday’s fall, the daily chart now depicts a breakdown from an ‘Inverted Flag’ and since there is no major support visible before 235 – 230, we expect this downward move to continue for a while. Hence, we recommend selling this counter on a minor pull back towards 251 to make it a better risk reward proposition. An immediate target to watch out for would be around Rs 240 - 235 and the stop loss should be fixed at Rs 256. READ MORE

Commodity Picks

Soybean
 
Soybean at the benchmark Indore markets are trading at Rs 3,671 per quintal. Over the next few days, prices are expected to head towards Rs 3,600 per quintal. Subdued demand from processors, adequate stocks and higher acreage expectations for new season would keep prices under pressure.

Bulk deals on NSE as on Friday

Click here for the full list

Date Symbol Security Name Client Name Buy / Sell Quantity Traded Trade Price /
Wght. Avg. 
Price
Remarks
19-Jul-2019 AMBANIORG Ambani Organics Limited ARYAMAN CAPITAL MARKETS LIMITED SELL 30,000 70.00 -
19-Jul-2019 AMBANIORG Ambani Organics Limited S K GROWTH FUND PVT LTD BUY 30,000 70.00 -
19-Jul-2019 ARVIND Arvind Limited TOWER RESEARCH CAPITAL MARKETS INDIA PRIVATE LIMITED BUY 13,77,142 58.29 -
19-Jul-2019 ARVIND Arvind Limited TOWER RESEARCH CAPITAL MARKETS INDIA PRIVATE LIMITED SELL 13,77,142 58.11 -
19-Jul-2019 BFUTILITIE BF Utilities Limited TOWER RESEARCH CAPITAL MARKETS INDIA PRIVATE LIMITED BUY 2,11,883 230.61 -
19-Jul-2019 BFUTILITIE BF Utilities Limited TOWER RESEARCH CAPITAL MARKETS INDIA PRIVATE LIMITED SELL 2,11,883 230.94 -
19-Jul-2019 DHFL Dewan Housing Fin Corp ALPHAGREP SECURITIES PRIVATE LIMITED BUY 25,88,939 53.76 -
19-Jul-2019 DHFL Dewan Housing Fin Corp ALPHAGREP SECURITIES PRIVATE LIMITED SELL 25,90,878 53.77 -
19-Jul-2019 DHFL Dewan Housing Fin Corp CALIFORNIA PUBLIC EMPLOYEES RETIREMENT SYSTEM BUY 41,51,515 53.60 -
19-Jul-2019 DHFL Dewan Housing Fin Corp TOWER RESEARCH CAPITAL MARKETS INDIA PRIVATE LIMITED BUY 26,37,816 54.29 -

FII/FPI & DII trading activity on NSE, BSE and MSEI


Oil check

At 08:23 am, Brent Crude Futures were at $63.26 per barrel

SGX Nifty

At 08:23 am, SGX Nifty was trading 29 points lower at 11,400 levels, indicating a negative start for domestic indices.

Asian Markets check


US Market check


Good morning!

Welcome to the Business Standard live blog.

Catch all the live market updates here