The selling intensifies...

Wed, 27 Jan 01:30 pm

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The Indian markets lost further ground during the previous two hours of trade with selling activity being witnessed across all sectors. Among the sectoral indices, stocks from the realty, banking, auto, and metals are leading the fall. Not a single sectoral index is showing any gains currently.

The BSE-Sensex and the NSE-Nifty are currently trading lower by around 400 points and 110 points respectively. Stocks from the midcap and small cap spaces are currently trading in the red, with the BSE-Midcap and the BSE-Smallcap indices trading lower by 2.7% and 3.5% respectively. The rupee is trading at 46.40 to the US dollar.

FMCG behemoth HUL announced results yesterday. The company’s sales grew by 4.4% during 3QFY10. This growth was aided by the personal products segment, and was partly offset by the soaps and laundry segment due to a cut in laundry prices. Operating (EBITDA) margins for the company in 3QFY10 fell by 0.2% YoY and stood at 17.2%. This fall came on the back of higher advertisement costs (as a percentage of sales) recorded this quarter. The bottom line for 3QFY10 grew by 5.4% YoY on the back of higher extraordinary income. On adjusting for non recurring income, the bottom line fell by 9% YoY. The net profits for 9mFY10 fell by 6% YoY due to a lower exceptional income. However, when adjusted for one time income/loss the bottom line grew by 4% YoY.

Metals major Hindalco announced its results. Its standalone topline grew by 29% YoY during 3QFY10 on account of higher production in both the aluminium and copper segments. Higher realisations from copper also helped. The company’s EBITDA margins declined to 14% during the quarter from 19% in 3QFY09 primarily as raw material cost increases by 10% as a percentage of sales. Other income declined by 67% during the quarter. The standalone bottomline registered a decline of 22% YoY during 3QFY10 on account of lower operating margins and other income. A nearly unchanged tax outgo also did not help matters much. The company has issued 213 m shares through qualified institutional placement. The total proceeds were Rs 27.9 bn. It has been utilized in issue related expenses of Rs 430 m, Rs 450 m in various ongoing projects while the balance has been invested temporarily in mutual funds. Eventually they will be used to part finance the equity in new aluminium projects.