The initial euphoria over anticipated rate cuts converted to weakness after Reserve Bank of India (RBI) left the key rates unchanged in the monetary policy.
Persistent selling in industry heavyweights saw the Indian share markets slip below the dotted line in the last two trading hours. Majority of the interest sensitive sectors are trading in red with metal, banking and auto stocks leading the losers. IT, pharma and FMCG stocks are trading in positive territory.
Majority of the Energy stocks are trading in red with Bharat Petroleum Corporation Ltd. (BPCL) and OIL India being the biggest losers. Essar Oil and Oil and Natural Gas Corporation Ltd. (ONGC) are among the handful of gainers. State-run oil & gas company Gas Authority of India Ltd (GAIL) announced its results for the quarter ended June 2012. The company registered a 25% YoY growth in the topline during the quarter. The company has offered a discount of Rs 7 bn during the quarter to share under recoveries on LPG (Liquefied Petroleum Gas).Its operating profit grew by 21.9% YoY with margins at 17.3% versus 17.7% in 1QFY12 and 7.3% in 4QFY12. The net income for the quarter grew by 15% YoY. During the quarter, the company has capitalized its Bawana-Nangal Pipeline at a value of Rs 13.8 bn. The company is targeting to spend Rs 73.5 bn in FY13 to expand its pipeline network. The capex plan will be funded through borrowings of Rs 40.5 bn and the balance through internal accruals. GAIL stock is down 0.9%.
Barring Punjab & Sind Bank, most of the public sector banking stocks are trading in red with Bank of Baroda and Central bank being the biggest losers. Bank of Baroda announced its results for the quarter ended June 2012 recently. The bank reported an interest income growth of 29% YoY while its interest expenses increased at a faster pace of 32.9% YoY. The net interest income grew by 22% YoY in 1QFY13. Advances grew by 23% YoY during the quarter while other income grew by 20% YoY. In terms of net interest margins (NIMs), the bank performed well as its global NIMs were sustained at 2.7% in 1QFY13. However, Bank of Baroda's net NPAs moved up marginally to 0.65% in 1QFY13 from 0.44% in 1QFY12. At the net level, the bank's net profit increased by 10% YoY in 1QFY13 as provisions on non performing advances brought down the profit levels of the bank. At the end of the quarter, the bank's capital adequacy ratio stood at a comfortable rate of 13.7%.