Indian share markets open weak

Tue, 13 Aug 09:30 am

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Barring China (down 0.02%), all major Asian stock markets have opened the day on a firm note with Japan (up 1.4%), South Korea (up 1%) and Hong Kong (up 0.7%) leading the gains. The Indian share market indices have opened the day on a negative note. Stocks in the banking, capital goods and metal space are leading the losses. However, realty and information technology stocks are trading firm.

The Sensex today is down by around 28 points (0.2%), while the NSE-Nifty is down by around 16 points (0.3%). However, mid and small cap stocks are trading in the green with the BSE Mid Cap and BSE Small Cap indices up by around 0.3% each. The rupee is trading at Rs 61.06 to the US dollar.

Oil & gas stockshave opened the day on a mixed note with Gujarat State Petronet Ltd (GSPL) and Essar Oil leading the gains. However, Oil & Natural Gas Corporation (ONGC) and Bharat Petroleum Corporation Ltd (BPCL) are facing selling pressure. State-run energy exploration major ONGC has announced its first quarter results for the financial year 2013-14 (1QFY14). The company's net sales declined by 4.3% year-on-year (YoY) to Rs 192,183.1 m during the quarter. Operating profits dropped by 30.3% YoY to Rs 69,202.5 m owing to higher operating expenses, increase in subsidy burden and one-time charge towards employee pension benefits. As such, operating profit margins contracted from 49.2% in 1QFY13 to 35.8% in 1QFY14. Other income increased by 15.2% YoY to Rs 11,961 m. While depreciation charges increased by 16.8% YoY to Rs 23,325 m, interest expenses dropped sharply from Rs 293.1 m in 1QFY13 to Rs 2.1 m in 1QFY14. At the bottomline level, net profit declined by 33.9% YoY to 40,159.8 m. Net profit margins declined from 30.1% in 1QFY13 to 20.8% in 1QFY14.

Food stocks have opened the day on a firm note with Britannia Industries, Agro Tech Foods and Ruchi Soya Industries leading the gains. FMCG major Britannia Industries has announced its first quarter results for the financial year 2013-14 (1QFY14). The company's consolidated net sales increased by 14.2% year-on-year (YoY) to Rs 15,396.2 m during the quarter. Operating profits shot up 72.9% YoY to Rs 1,377.1 m owing to lower expenses and better realisations. As such, operating profit margins improved by 300 basis points (3%) from 5.9% in 1QFY13 to 8.9% in 1QFY14. Other income increased by 31.1% YoY to Rs 142.4 m. While depreciation charges increased by 18% YoY to Rs 195.7 m, interest expenses declined by 59.6% YoY to Rs 42.1 m. On the back of healthy growth and profitability during the quarter, net profit increased by 92.6% YoY to 895.8 m. Net profit margins improved from 3.4% in 1QFY13 to 5.8% in 1QFY14.