The News International Team
03:15pm TCS Earnings Poll: All eyes will be on IT bellwether TC when it reports quarterly earnings declaration today evening, in which investors will be keen to ascertain whether a stumble on revenue growth in the past two quarters was an aberration or a sign the firm’s high growth pace may be secularly slowing down due to size.
By being the first major company to report fourth-quarter numbers, TCS will for the first time also don the mantle of being the company that “unofficially kick-starts” the earnings season. For many years now till the last quarter, this job was done by Infosys, the company TCS has raced past by on revenues, valuation and brand metrics in the past few years (the former has said it would announce results on April 24).
For TCS, analysts will be keenly eyeing whether the company will be able to even meet the now-muted expectations on revenue growth and how much of a hit margins take due to forex movements and seasonality impact.
A CNBC-TV18 poll of analysts has forecast the firm’s dollar revenue to grow 0.2 percent to USD 3940 million versus USD 3931 million in the previous quarter, while rupee revenue is seen declining 0.1 percent, from Rs 24,501 crore to Rs 24,456 crore.
Operating profit (earnings before interest and taxes) is seen falling 1.2 percent to Rs 6,540 crore while net profit may fall 0.6 percent to Rs 5,410 crore. The fall in profit may result in TCS’s EBIT margin coming off from 27.04 percent to 26.74 percent.
03:00pm Market Update: The market pared its losses led by banking & financials and oil stocks. The Sensex fell 98.77 points to 28700.92 and the Nifty declined 39.40 points to 8710.80.
About 1017 shares have advanced, 1726 shares declined, and 160 shares are unchanged on the BSE.
02:45pm MMTC divestment: The government is planning to sell 15 percent stake in state-run trading firm MMTC in the current fiscal which would fetch about Rs 800 crore to the exchequer. “The government plans to divest 15 percent stake in the company. We are ready for it,” MMTC Chairman Ved Prakash told reporters.
At the current market price of Rs 52.80 apiece, sale of about 15 crore shares would garner around Rs 800 crore for the exchequer.
The government currently holds 89.93 percent stake in the state-run trading giant and the stake sale would help the company meet Sebi’s minimum public shareholding norm. Market regulator Sebi has made it mandatory to have a minimum public holding of 25 percent in all PSUs.
The stake sale proceeds would help the government inch towards the disinvestment target of Rs 41,000 crore fixed for the current fiscal. So far, it has already raised Rs 1,550 crore through 5 percent stake dilution in REC. The government had last sold 9.33 percent stake in MMTC in June 2013 through which it had raised about Rs 570 crore.
02:25pm Earnings: IndusInd Bank matched street expectations on Thursday with the fourth quarter (January-March) net profit rising 25.1 percent year-on-year to Rs 495.3 crore. Asset quality of the bank improved too, during the quarter.
Net interest income was slightly lower than expectations at Rs 925.14 crore in quarter ended March 2015, up 18.4 percent compared to Rs 781.2 crore in the year-ago period. Net interest income is the difference between interest earned and interest expended. According to CNBC-TV18 poll, NII was expected at Rs 941.5 crore for the quarter.
The profit was boosted by strong other income and lower provisions. Other income (non-interest income) jumped 26 percent year-on-year to Rs 658.48 crore crore while operating expenses climbed 25.3 percent to Rs 733.11 crore during January-March quarter. Other income was largely driven by fee income that jumped 29 percent.
Provisions for bad loans dropped 10.9 percent on yearly basis (up 9.6 percent sequentially) to Rs 107.44 crore in the fourth quarter of financial year 2014-15.
The bank reported good improvement in its asset quality performance as gross non-performing assets (NPA) declined to 0.81 percent in March quarter from 1.05 percent in previous quarter and 1.12 percent in the year-ago quarter. Net NPA stood at 0.31 percent during the quarter against 0.32 percent Q-o-Q and 0.33 percent Y-o-Y.
02:00pm Market Check:
The market is completely in bear grip as capital goods and technology stocks shed heavily. The Sensex is down 168.45 points or 0.6 percent at 28631.24 and the Nifty is down 60.60 points or 0.7 percent at 8689.60.About 890 shares have advanced, 1766 shares declined, and 144 shares are unchanged.
Buoyed up by global oil prices hitting 2015 high, Oil & Gas index is in green, up 0.5 percent while rest of the indices are under selling pressure. ONGC, Bharti Airtel, M&M, SBI and HDFC are top gainers in the Sensex. On the losing side are Hero MotoCorp, Sun Pharma, Sesa Sterlite, Cipla and Wipro.
Unilever reported better-than-expected sales for the first quarter on Thursday, showing improvement from the hammering it took last year from weak emerging markets including a slowdown in China. Unilever’s full-year sales growth would probably come in at the upper end of its prior stated goal of 2 to 4 percent.
In the first quarter, underlying sales rose 2.8 percent, excluding the impact of currency moves, acquisitions and disposals. The Anglo-Dutch maker of Dove soap, Lipton tea and Ben & Jerry’s ice cream cited an improvement in China and an earlier Easter.
Meanwhile, Finance Minister Arun Jaitley said India has the potential to grow at nine to ten per cent growth rate, “a new normal” and asserted that high growth was essential to meet the challenges posed by the country’s burgeoning young population.
Speaking at the day-long conference ‘Deepening the US-India Commercial Partnership: The First Year of the Modi Government’, Jaitley said in his keynote address that “India’s own normal in terms of its growth rate has to target anything close to a double digit. India growing at five per cent, six per cent or even seven per cent is not an India that is going to face up this challenge (of large young population).”