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The domestic equity barometers ended with deep cuts after a weak session on Wednesday. The Nifty closed tad below the 17,900 level after opening near the 18,100 mark. All the sectoral indices on the NSE ended in the red, with banks, financials and oil & gas stocks falling the most. Weak global cues and sluggish growth outlook from companies spooked investors. Trading was volatile on account of monthly options expiry.
As per provisional closing data, the barometer index, the S&P BSE Sensex, tumbled 773.69 points or 1.27% to 60,205.06. The Nifty 50 index lost 226.35 points or 1.25% to 17,891.95.
In the broader market, the S&P BSE Mid-Cap index slipped 1.52% while the S&P BSE Small-Cap index declined 0.94%.
Seller outnumbered buyers. On the BSE, 1135 shares rose, and 2380 shares fell. A total of 131 shares were unchanged.
On the occasion of Republic Day (26 January), both the equity exchanges - BSE and National Stock Exchange will remain shut tomorrow and trading will resume on Friday (January 27).
Adani Stocks Sell-off:
Stocks of the seven listed Adani Group companies fell by 1.65% and 6.01% today after US-based Hindenburg Research LLC said it shorted Adani Group companies due to brazen market manipulation and accounting fraud.
Adani Transmission (down 8.06%), Adani Ports and Special Economic Zone (down 6.30%), Adani Wilmar (down 5%), Adani Power (down 4.99%), Adani Total Gas (down 3.61%), Adani Green Energy (down 3.04%) and Adani Enterprises (down 1.54%) slumped.
Hindenburg, an US-based investment research firm that specializes in activist short-selling, made wide-ranging allegations of corporate malpractice following a two-year investigation into the Adani group companies.
We hold short positions in Adani Group Companies through U.S.-traded bonds and non-Indian-traded derivatives, along with other non-Indian-traded reference securities, Hindenburg disclosed in its research report published on 24 January 2023.
Hindenburg said its research involved speaking with dozens of individuals, including former executives of Adani, reviewing thousands of documents, and conducting diligence site visits in almost half a dozen countries. The Adani Group's seven key listed companies have 85% downside purely on a fundamental basis, owing to sky-high valuations, the report said.
In a statement issued to the media, Jugeshinder Singh, Group CFO, Adani, said: “We are shocked that Hindenburg Research has published a report on 24 January 2023 without making any attempt to contact us or verify the factual matrix. The report is a malicious combination of selective misinformation and stale, baseless and discredited allegations that have been tested and rejected by India's highest courts.
The timing of the report's publication clearly betrays a brazen, mala fide intention to undermine the Adani Group's reputation with the principal objective of damaging the upcoming Follow-on Public Offering from Adani Enterprises, the biggest FPO ever in India.
The investor community has always reposed faith in the Adani Group on the basis of detailed analysis and reports prepared by financial experts and leading national and international credit rating agencies. Our informed and knowledgeable investors are not influenced by one-sided, motivated and unsubstantiated reports with vested interests.”
Stocks in Spotlight:
Indian Bank rose 0.22%. The bank reported 102.36% jump in standalone net profit to Rs 1,395.76 crore on 18.02% rise in total income to Rs 13,550.68 crore in Q3 FY23 over Q3 FY22.
Cipla fell 2.12%. The pharma major's consolidated net profit rose 9.93% to Rs 800.96 crore on 6.05% increase in total revenue from operations to Rs 5,810.09 crore in Q3 FY23 over Q3 FY22.
TVS Motor Company jumped 5.11%. The auto maker reported 22% rise in standalone net profit to Rs 353 crore on a 15% increase in revenue to Rs 6,545 crore in Q3 FY23 over Q3 FY22.
Pidilite Industries fell 2.20%. The adhesives maker reported consolidated net profit of Rs 307.74 crore in Q3 FY23 from Rs 359.24 crore in Q3 FY22. Total income rose to Rs 3002.72 crore in Q3 FY23 from Rs 2855.89 crore in Q3 FY22.
United Spirits tumbled 6.14%. The spirits maker's standalone net profit tumbled 64.45% to Rs 110.5 crore in Q3 FY23 as against Rs 310.8 crore posted in Q3 FY22.
Macrotech Developers declined 1.76%. On a consolidated basis, the real estate developer's net profit jumped 41.41% to Rs 404.98 crore despite of 13.87% surge in net sales to Rs 1,773.80 crore in Q3 FY23 over Q3 FY22.
Indus Towers slumped 7.24%. The company reported consolidated net loss of Rs 708 crore in Q3 FY23 as compared to net profit of Rs 1571 crore in Q3 FY22. Revenue fell to Rs 6765 crore in Q3 FY23 from Rs 6927 crore in Q3 FY22.
Global Markets:
European markets advanced on Wednesday, attempting to pare losses incurred in the previous session, after data out of the eurozone showing an uptick in business activity in the region's services and manufacturing sectors.
A widely watched gauge of German business sentiment from the Munich-based Ifo Institute showed “considerably less pessimistic expectations” in January.
Meanwhile, S&P Global eurozone composite purchasing managers' index came in at 50.2 in January, up from 49.3 in December. The 50 mark separates expansion from contraction.
Most of Asian stocks traded higher on Wednesday, taking the lead from Wall Street's struggle for direction as China and Hong Kong markets remain closed for the Lunar New Year holidays.
US stocks ended nominally lower on Tuesday at the close of a rocky session marked by a raft of mixed earnings and a technical malfunction at the opening bell.
The downturn in the US business activity eased slightly in January even as it contracted for the seventh straight month, survey showed on Tuesday. S&P Global said its flash US Composite PMI Output Index, which tracks the manufacturing and services sectors, shot off to 46.6 this month from a final reading of 45 in December.
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