Report by- Sabyasachi Bhattacharya
TCS to announce their Q2 results tomorrow. Top factors to watch for-
TATA Consultancy Services, the country’s largest software services exporter, is set to kick off July-September quarter earnings season on October 11. Almost all analysts on the Street have already predicted that the rupee tailwind is likely to play a big role in earnings of IT companies. Experts suggest that the effect of currency depreciation is likely to be seen for couple of quarters, and that the stock prices seem to have priced in this momentum. If we look at last one year’s stock performances, top three positions have been occupied by IT stocks. TCS has been the biggest gainer among Nifty50 stocks as the stock shot up 70 percent in last one year followed by Infosys (up 59 percent) and Tech Mahindra (52 percent). TCS continues to be the preferred pick among IT pack for all brokerage houses. Here are the top 3 factors to watch out for-
- Revenue- Q2 is seasonally stronger quarter for IT companies due to new deal ramp-ups after the finalisation of client budgets in Q1FY19. Most analysts expect TCS to lead the sector with revenue growth in the range of 3.5-4.5 percent, sequentially.
- Profit- Strong revenue growth and operational performance both are expected to boost profitability of the company.
- Operational Performance– Brokerage houses largely expect strong margin performance due to rupee depreciation and no wage hike in September quarter.
Source-MoneyControl, Purple Trades Research Department
Bandhan Bank releases their Q2 results. Let’s look ata few key insights–
Private sector lender Bandhan Bank has reported a healthy 47.4 percent growth in profit of July-September quarter compared to a year-ago, driven by strong NII and operating income, and stable asset quality. Let’s take a look at the key data from their Q2 results-
- Profit increased to Rs 488 crore during the quarter, from Rs 331 crore in corresponding period last fiscal
- Net interest income shot up 6 percent year-on-year to Rs 1,078 crore in Q2 with strong improvement in net interest margin and massive growth in advances.
- Bandhan Bank said advances (on book + off book) increased by 9 percent year-on-year to Rs 33,373 crore in September quarter while deposits growth was 29.6 percent to Rs 32,959 crore with retail deposit to total deposit at 81.6 percent.
- Net Interest Margin for the quarter stood at 10.3 percent, which improved by 100 basis points from 9.3 percent reported year-ago but flat on sequential basis.
- CASA ratio for the quarter stood at 36.9 percent of total deposit, compared to 28.2 percent in the corresponding period last year. CASA grew 69.8 percent YoY at Rs 12,176 crore compared to Rs 7,170 crore.
- Asset quality was largely stable in the quarter gone by. Gross non-performing assets as a percentage of gross advances inched up to 3 percent in Q2FY19 from 1.26 percent in previous quarter and net NPAs were higher at 0.7 percent against 0.6 percent quarter-on-quarter.
- Provisions and contingencies increased sharply by 55 percent sequentially and 43 percent year-on-year to Rs 124.17 crore in quarter gone by.
- The bank has maintained its capital adequacy ratio at 32.6 percent for the quarter YoY, but improved from 26.3 percent in Q2FY18.
Source-FirstPost, Purple Trades Research Department
Indian Markets recover sharply as Bulls take charge in today’s game-
Chart source- Upstox
It was all guns blazing by the bulls today. Financials propelled a big rally on benchmark indices, while a big surge in the midcaps space also boosted sentiment on D-Street on Wednesday. Bears were left behind in today’s race by the bulls who rallied up Nifty to breach the 10,400 mark. As we mentioned in our yesterday’s post, 10,300 was termed as a crucial support level for the markets and the index truly respected that level. Nifty opened higher, which was a good sign for the market and from there on the bulls dominated over the bears and didn’t allow the bears to enter the market. Bank Nifty closed over 3 percent higher, while the Nifty Midcap index soared over 4 percent. Even PSU banks were one of the biggest movers; the Nifty PSU bank index rose over 5 percent. Other gainers include automobiles, which rose around 3 percent. The big loser, though, was the Nifty IT which fell over 1.5 percent. At the close of market hours, the Sensex closed up 461.42 points or 1.35% at 34760.89, while the Nifty rose 159.10 points or 1.54% at 10460.10. The market breadth was positive as 2,031 shares advanced, against a decline of 610 shares, while 759 shares were unchanged. Let us take a look at a few key factors that moved the markets today-
- Dollar weakened against the Rupee by 20 points i.e. almost 0.28%. This was seen as a positive sign for the bulls.
- Silver remained weak and traded RS 50 lower at Rs 39,200 per kg due to slackened demand from industrial units and coin makers. This can be seen as a positive sign as investors are leaving safe investments in precious metals and are injecting more money into the markets.
- There was a decline in the price of Brent Crude Oil by 0.11%. This was a positive side for the market.
- Asian markets performed significantly well kin the early hours of today as Nikkei closed above 36.65 points above giving a increase of (+0.16%). All in all today was a relatively good day for the Asian markets.
Source- Purple Trades Research Department
Top sectors that moved the market today- Data source- Moneycontrol
Top Gainers for today- Data source- Moneycontrol
Top losers for today- Data source- Moneycontrol