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Results take precedence - Views on News from Equitymaster
 
 
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  • Jul 26, 2003

    Results take precedence

    It was a week dominated by results and volatility on the bourses. Results played an important role as some big companies like ACC, SBI, Satyam, Tisco, ITC and Telco declared their June quarter earnings numbers. Volatility was also the flavour of the week as the indices continued their expected correction streak in the early half of the week and finally snapped their losing streak on Wednesday by registering gains. It must be noted that prior to this, the indices had lost ground for four consecutive sessions. The latter half of the week saw the markets recoup all the losses garnered in the previous four trading sessions. While the BSE Sensex gained 2.2% during the week, the NSE Nifty also notched gains of 2%. Index heavyweights were the prime pushers for the indices, which made them close above some crucial psychological levels.

    Some key results this week and their stock price movement
    Company Topline growth (%) topline growth (%) Price change (%)
    Bharti Tele 92% Back in profits 13%
    Satyam Computers* 4% Back in profits 12%
    SBI 3% 20% 3%
    ACC 7% 123% 2%
    Tata Power 4% 19% 0%
    Tisco 28% 316% 0%
    Digital Globalsoft* 11% 1% 0%
    ABB 16% 39% 0%
    ITC 2% 16% -1%
    Telco 43% 258% -2%
    Ranbaxy 11% 42% -3%
    Ashok Leyland 5% 52% -3%
    * Growth on a sequential basis
    Note: Click on company links for detailed results

    The week just ended had nothing significant that could be highlighted here today. It was just results, Monday through Friday. In fact, the results week does not end here, as Saturday also will be witness to two important results, Bajaj Auto and ONGC. Of course, reaction to the results and the market verdict will be seen only on Monday. However, one point worth mentioning here is the fact that, the gains witnessed in the last three trading sessions of the week was primarily due to the strength seen in index heavyweights like HLL, Reliance and Infosys. It must be noted that Reliance and HLL are due to announce their results on July 30 and July 31 respectively.

    Top 5 gainers over the week
    COMPANY Price on July 18 (Rs) Price on July 25 (Rs) % CHANGE 52-WEEK H/L (Rs)
    BSE-SENSEX 3,648 3,726 2.2% 3,750 / 2,828
    S&P CNX NIFTY 1,140 1,163 2.0% 1,176 / 920
    TATA FINANCE 25 30 21.7% 30 / 14
    G.E. SHIPPING 47 55 18.3% 58 / 26
    LUPIN LTD. 332 387 16.3% 391 / 90
    INDIAN RAYON 138 159 15.6% 168 / 75
    CADILA HEALTHCARE 182 206 13.6% 209 / 110

    One of the top gainers this week was India’s largest private sector shipping company, G.E.Shipping, and this was due to its splendid performance on the quarterly results front. For the June quarter, the company’s net profit soared by a massive 227% on the back of a 31% growth in topline. The upswing in the dry bulk segment has helped the company register this growth.

    Top 5 losers over the week
    COMPANY Price on July 18 (Rs) Price on July 25 (Rs) % CHANGE 52-WEEK H/L (Rs)
    PENTAMEDIA 12 10 -10.2% 33 / 7
    ASHOK LEYLAND FIN 54 49 -8.1% 65 / 37
    SILVERLINE TECH 8 8 -7.6% 33 / 5
    INGERSOLL RAND 256 237 -7.4% 271 / 188
    LIC HSG. FINANCE 153 143 -6.5% 169 / 57

    Going forward into next week, the impact of results on the markets will be high, as it was during the start of the results season when Infosys declared its results. 2 of the ‘big’ 3, Reliance and HLL, will announce their results, which will set the tone for the market going forward. Moreover, now that the Supreme Court has stayed the divestment of the two oil majors, HPCL and BPCL, uncertainty over the divestment issue has surfaced once again. However, at the macro level, though there could be short-term concerns, long-term investors should not be deterred by temporary blips and keep their eye on the Indian growth story.

     

     

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