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Volatility plagues Indian indices 
(Mon, 19 Nov Closing) 
Indian equity markets had a rather volatile trading session today. While they began the day's proceedings on a positive note, subsequent hours saw the indices oscillate to either side of Friday's close. The final trading hour, however, saw buying intensify as a result of which the indices managed to close barely above the dotted line. While the Sensex today closed higher by 30 points (up 0.2%), the NSE-Nifty today closed flat. However, the BSE Mid Cap and the BSE Small Cap bucked the trend as they lost 1% each. While gains were largely seen in auto and FMCG stocks, consumer durables and healthcare stocks were at the receiving end.

As regards global markets, most Asian indices closed mixed today while European indices have also opened on a mixed note. The rupee was trading at Rs 55.04 to the dollar at the time of writing.

Steel stocks closed in the red today with the key losers being Tata Steel, Steel Authority of India (SAIL) and JSW Steel. Tata Steel announced results for the second quarter ended September 2012. Consolidated topline grew by just 4.1% YoY on back of lower sales volume. Consolidated operating profit was down by 19.4% YoY while the operating margins reduced by nearly 1.9%. On a consolidated basis, the company reported a net loss as against a net profit when compared to the same period last year. On a standalone basis, the company reported an increase of 11.4% YoY in net sales and a decline of 9.7% YoY in net profits. For the half year ended September 2012, on a consolidated basis the company reported a 3% YoY increase in net sales and 98.1% YoY decline in net profits.

Wockhardt also announced results for the second quarter ended September 2012. Topline grew by 29% YoY during the quarter led by growth in its international business. Excluding the nutrition business (the company sold this business last fiscal), growth was at 38% YoY. US witnessed growth of 22% in constant currency terms and 47% in Rupee terms. Currently, the US contributes around 48% to total business against 31% and 44% in FY11 and FY12 respectively. The higher contribution is due to launch of Toprol and Para IV launches under low competition with Toprol being the key product for the company. India business (excluding Nutrition business) grew at a low rate of 4%. This was due to restructuring of the field force during quarter. Operating margins improved dramatically by 11.6% leading to an 85% YoY growth in operating profits. This was largely due to one time inventory impact, and slight improvement in the other segments. It is pertinent to note that company's forex position is open. Thus, the depreciation of the rupee too played a role in margin improvement. Bottomline increased by 477% YoY during 2QFY13, due to exceptional gain in 2QFY13 as against an exceptional loss in 2QFY12. The stock closed lower today.
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