Sensex Opens Flat; Consumer Durables & Realty Stocks Lose

Wed, 6 Jun 09:30 am

   Previous Close   

   Pre-Open   

   12:30 pm   

   Closing   

Asian share markets are higher today as Chinese and Hong Kong shares show gains. The Shanghai Composite is up 0.3% while the Hang Seng is up 0.3%. The Nikkei 225 is trading up by 0.2%. Meanwhile, the Nasdaq Composite index rose to an all-time high on Tuesday, led by Netflix and Amazon, while the rest of the market struggled for gains amid US trade tensions.

Back home, India share markets opened the day on a flat note. The BSE Sensex is trading up by 37 points while the NSE Nifty is trading up by 3 points. The BSE Mid Cap index opened down by 0.1% while BSE Small Cap index opened down by 0.4%.

Sectoral indices have opened the day on a mixed note with metal stocks and automobiles stocks witnessing maximum buying interest. While, consumer durables stocks & realty stocks have opened the day in red. The rupee is trading at 67.18 to the US$.

FMCG stocks opened the day on a mixed note with Kokuyo Camlin & Marico leading the gainers. As per an article in a leading financial daily, Patanjali Ayurved Ltd, which has put in a bid for Ruchi Soya Industries Ltd, is in talks with Godrej Agrovet Ltd for a potential tie-up for the bid.

Patanjali may sell Ruchi Soya's palm oil plantation assets to an external buyer if its bid is successful.

Reportedly, Patanjali which already sources raw material from Ruchi Soya is mainly interested in acquiring the brands of the company some of which command significant market share.

Ruchi Soya's food products include healthy cooking oils, nutritional soya foods, top-grade vanaspati and bakery fats. The edible oil range includes brands like Mahakosh Soyabean oil, Ruchi Gold Palmolein and Sunrich sunflower oil. Nutrela is one of the largest selling soya foods brand, with more than 50% market share. Ruchi Soya has close to 110,000 hectares of palm plantations in various parts of the country.

As per Mint report, Godrej Agrovet was looking to bid for Ruchi Soya in March with an eye on its palm oil business. Since Godrej is not interested in Ruchi Soya's other businesses, it may tie up with others keen on those businesses.

Godrej Agrovet is among the largest oil palm developers in India and owns more than 61,700 hectares of plantations across Andhra Pradesh, Telangana, Tamil Nadu, Goa, Maharashtra and Mizoram producing crude palm oil, crude palm kernel oil and palm kernel cake.

Apart from palm oil, the company also has significant present and market share in animal feed and crop protection segments.

Godrej Agrovet share price opened the day down by 0.7%.

To get more updates on share market, click here.

Moving on to the news from the economy. As per CRISIL report, Gross non-performing assets in the banking system, which stood at 11.2% in FY18, is likely to touch 11.5% in this fiscal.

In FY18, GNPAs increased to around Rs 10.3 trillion, or 11.2% of advances compared with Rs 8 trillion, or 9.5% of advances, as on 31 March 2017.

In FY18, the banking system reported a net loss of Rs 400 billion because of the sharp rise in NPAs and the resulting increase in provisioning costs.

In the previous fiscal, as much as Rs 5 trillion of bank loans slipped into the non-performing assets (NPAs) category, taking the total slippages in the past three fiscals to Rs 13.6 trillion.

About a fifth of the slippages in FY18 was due to withdrawal of various structuring schemes by the Reserve Bank in February, after the Insolvency and Bankruptcy Code (IBC) process came into force, the report stated.

The rating agency, however, said the tide is slowly turning and it expects moderation in slippages, better recoveries from NPAs and improved provision coverage to bode well for banks.

The accounts which are in the special mention account-2 (SMA-2, where exposures are overdue by 60-90 days), have more than halved to 0.8% of advances as of last fiscal-end, compared with 2% a year before, indicating considerable reduction in stressed loans that can potentially regress into NPAs.

Further, prospects of recovery from stressed accounts referred to the National Company Law Tribunal (NCLT) are improving. More than a quarter of the Rs 3.3 trillion worth of cases referred to NCLT for resolution are from the steel sector which has seen heightened bidding interest due to improving prospects for the sector.

The banking systems provisioning cover (excluding write-offs) for NPAs increased to 50% as on 31 March, 2018, compared with 45% a year back, and it is expected to improve further in this fiscal.

It further said state-run banks remain highly dependent on the government for capital to meet Basel III norms.

Given the higher-than-expected losses last fiscal, probable loss in the current fiscal, and recall of the additional tier 1 instruments by a few PSBs, the Rs 2.1 trillion recapitalisation program announced in October 2017 may be insufficient to meet the capital requirements of PSBs by the end of this fiscal, the report stated.

Note that, Public Sector Banks (PSBs) have had a difficult year, to put it mildly.

PSBs Struggle Despite Government Help

After the euphoria of recapitalisation, bad loans have come to haunt them. Post the Gitanjali Gems fiasco, PSBs are yet to fully recover from its impact.

This underperformance was despite the huge boost they got from the government last year. On 24 October 2017, the government announced a Rs 2.11 trillion public sector bank (PSB) capitalisation plan. This move was aimed at reviving the PSBs from the bad loan mess.

The next day was a field day for investors in PSBs. PSB stocks went up between 30% and 47%. Despite this, the return in the year was way below average. PSBs like Punjab National Bank (PNB) have crashed more than 45% over the last one year.

Have we reached the bottom? Or there are more Nirav Modi stories waiting to come out?

We believe, rather than bottom fishing, one should look at banks run by strong management and a differentiated lending strategy available at reasonable valuations.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

Read the latest Market Commentary

Top Gainers TodayTop Gainers over 1-WeekTop Gainers over 1-MonthTop Gainers over 1-YearTop Gainers over 3-YrsTop Gainers over 5-YrsTop Losers TodayTop Losers over 1-WeekTop Losers over 1-MonthTop Losers over 1-YearTop Losers over 3-YrsTop Losers over 5-YrsOnly BuyersOnly SellersMost Active StocksMost Popular Stocks52 Week High Stocks52 Week Low Stocks

INDICESBSE (Rs 0 to 1)BSE (Rs 1 to 2)BSE (Rs 2 to 4)BSE (Rs 4 to 10)BSE (Rs 10 to 20)BSE (Above Rs 20)BSE - AllBSE-30BSE-100BSE-200BSE-500BSE AutoBSE BankexBSE Capital GoodsBSE Consumer DurablesBSE FMCGBSE HealthcareBSE ITBSE MetalBSE Oil & GasBSE PSUBSE TeckBSE RealtyBSE PowerBSE A GroupBSE B GroupBSE Mid-CapBSE Small-CapBSE Basic MaterialsBSE Consumer DiscretionaryBSE IndustrialsBSE UtilitiesBSE Sensex 50BSE Sensex Next 50BSE Bharat 22BSE 150 MidCapBSE 250 SmallCapBSE 250 LargeMidCapBSE 400 MidSmallCapBSE AllCapBSE LargeCapBSE SmallCap SelectBSE 100 LargeCap TMCBSE InfraBSE ManufacturingBSE CPSEBSE Private BankBSE Diversified FinancialsBSE MomentumBSE Low VolatilityBSE QualityBSE Enhanced ValueBSE Divident StabilityS&P BSE IPOBSE SMEIPOBSE 100 ESGBSE CarbonexBSE GreenexNSE (Rs 0 to 10)NSE (Rs 10 to 20)NSE (Above Rs 20)NSE - AllNSE-50NSE ITNSE Nifty Midcap 50NSE JR. NiftyNSE Bank NiftyNIFTY Next 50NIFTY 100NIFTY 200NIFTY 500NIFTY MidCap 100NIFTY SmallCap 250NIFTY SmallCap 50NIFTY SmallCap 100NIFTY LargeMidCap 250NIFTY MidSmallCap 400NIFTY AutoNIFTY Consumer DurablesNIFTY FinanceNIFTY FMCGNIFTY MediaNIFTY MetalNIFTY PharmaNIFTY Private BankNIFTY PSU BankNIFTY RealtyNIFTY Oil & GasNIFTY SME EmergeNIFTY CommoditiesNIFTY CPSENIFTY EnergyNIFTY India ConsumptionNIFTY InfraNIFTY MNCNIFTY PSENIFTY Serv SectorNIFTY100 Liquid 15NIFTY Midcap Liquid 15NIFTY Midcap 150 Quality 50NIFTY50 Equal WeightNIFTY100 Equal WeightNIFTY100 Low Volatility 30NIFTY100 Alpha 30NIFTY Alpha 50NIFTY Dividend Opportunities 50NIFTY High Beta 50NIFTY Low Volatility 50NIFTY200 Quality 30NIFTY 500 Value 50NIFTY 100 Quality 30SECTORSAgricultureAirlinesAluminiumAsset Management CompaniesAutomobilesAuto AncillariesBanks (Private)Banks (PSU)BankingCementChemicalsDefenceDiagnosticsDronesEngineeringElectric VehicleElectric Vehicle BatteryEnergy SourcesESGEthanolFertilizersFintechFMCGFoodGreen HydrogenHotelsInfrastructureInsuranceInvestment and FinanceInvITIT (Large)IT (Others)LogisticsMediaMetalMiningIndia's Big Tech StocksIndian PharmaMNC PharmaPSUPaintPaperPlasticPowerRating AgenciesReal EstateREITsRenewable EnergyRetailingSemiconductorShippingSteelSugarSupply ChainTelecomTextilesTravel Support Services

10 results 25 results 50 results 100 results All results

Indian Share Market Update: Top Gainers and Losers