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Indian Stock Market News, Equity Market and Sensex Today in India | Equitymaster
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Markets tank on poor Infy results 
(Fri, 12 Apr 09:30 am) 
 
Asian stock markets have opened the day on a mixed note with stock markets in Japan (down 0.8%) and South Korea (down 0.3%) leading the losses in the region. However, markets in Hong Kong (up 0.3%) and Indonesia (up 0.3%) are trading firm. The Indian equity market indices have opened the day on a weak note following poor fourth quarter results of India's second largest information technology firm. Stocks in the information technology space are leading the pack of losers with substantial losses. However, FMCG and oil & gas stocks are trading firm.

The Sensex today is down by around 241 points (1.3%), while the NSE-Nifty is down by around 63 points (1.1%). Mid and small cap stocks are also trading in the red with the BSE Mid Cap and BSE Small Cap indices down by around 0.4% and 0.5% respectively. The rupee is trading at Rs 54.54 to the US dollar.

Information technology stocks have opened the day on a weak note with the stock of Infosys down more than 16% on account of disappointing fourth quarter results. Indian IT bellwether Infosys has announced its fourth quarter (4QFY13) and financial year ended results for March 2013. During the quarter, the Bangalore-based IT firm reported revenues of Rs 104,540 m, marginally higher by 0.3% on a quarter-on-quarter (QoQ) basis. Operating profits dropped by 8% QoQ to Rs 24,620 m on account of higher operating expenses. However, other income rose sharply by 34% QoQ to Rs 6,740 m. The effective tax rate during the quarter was also lower by 1.8% QoQ. As such, the company reported a marginal 1.1% QoQ rise in the bottomline to Rs 23,940 m.The management of Infosys expects revenues to grow by about 6-10% during the current financial year 2013-14. The company's board of directors has declared a final dividend of Rs 27 per share for the financial year 2012-13.

Auto stocks have also opened the day on a weak note with TVS Motor Company and Tata Motors leading the losses. As per a leading financial daily, auto major Tata Motors reported a sharp decline of 29.2% year-on-year (YoY) in sales of passenger vehicles during the financial year 2012-13 (FY13). As against sales of 313,710 units in FY12, the company reported sale of 222,112 units during FY13. On the other hand, commercial vehicle sales declined by 1.3% YoY from 537,143 units in FY12 to 529,980 units in FY13. The company expects sales to recover during the current fiscal (FY14). However, it expects growth to be limited to single digits. A growth rate higher than that could only be achieved if there is a recovery in the medium and heavy commercial vehicles (M&HCV) segment.

It must be noted that due to the slowdown in the economy, domestic car sales in FY13 declined by 6.7% YoY to 1,895,471 units. This was the first time in the last 10 years that car sales reported a drop in growth. Commercial vehicle sales were also down by 6% YoY to 84,956 units as against 90,416 units in FY12.

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