Wednesday April 10, 03:30 PM
Infosys 'guides' markets... |
|
By Equitymaster.com
Encouraged by higher topline growth guidance by Infosys, software stocks were back in investors' radar today. While most of the PSU stocks drifted lower, activity was mixed in FMCG and media sectors. Commodity majors in general were also weak. Barring tractor majors, all other auto stocks closed higher.
The BSE Sensex closed at 3,477 (up 14 points) and the NSE Nifty closed at 1,138 (up 11 points). The rupee was trading at Rs 48.89 per US dollar.
The much-awaited Infosys' fourth quarter result was declared. Though the company's performance was in line with expectations, the management gave guidance for FY03. While topline is expected to grow 18%-22%, profits are expected to increase by 15%-18%. Billing rates would continue to remain under pressure in light of slowdown in tech spend. Billing rates are expected to fall 6%-8%. The stock was up 5%. Following this, tech was back in the reckoning.
Activity was mixed in commodity sector. Key cement majors fell today. The reason could be the weakness in cement prices and slower demand growth expectations in the coming fiscal. Besides, the sharp rise in crude prices will also have significant impact on profitability of these companies. The rise in crude prices also resulted in selling in paint companies. Asian Paints, Goodlass (GDLA.BO, news) and ICI closed in the red.
HDFC was down 2%. The apex housing finance major is expected to report a sharp drop in spreads in the coming fiscal in light of increasing competition, notably from SBI and select foreign banks. Market share of the company is also set to fall in the coming years (45% in 9mFY02). HDFC Bank (HDBK.BO, news) was up 2%.
Amongst FMCG majors, Pidilite and Marico were up 10% and 10% respectively. Valuations could be one of the key factors that could have led to this buying interest. Colgate (COLGd.BO, news) also gained 2%. P&G and Britannia were the prominent losers amongst FMCG stocks. There was selective buying interest in media companies as well. Mukta Arts, Pentamedia and Zee moved up. Balaji Telefilms, on the other hand, fell.
Tractor majors like Punjab Tractors and Escorts (ESCO.BO, news) were down marginally. Though the near term prospects remain challenging for this sector in light of over capacity. Given the low mechanisation levels in India, there is much room for growth. Amongst auto stocks, Ashok Leyland (ASOK.BO, news) and Telco continue to surge ahead in light of fresh CNG orders. But rising crude prices could force the government to raise diesel prices, which could have adverse impact on CV sales.
|
