India Markets Wednesday Wrap-Up: Banks, Commodity Stocks Lead Losers

Includes: ARVNF
by: Equitymaster

Taking cues from the negative sentiments across global markets, the indices in Indian stock markets closed lower today despite sporadic attempts to make inroads into the positive territory.

Banking and commodity stocks bore the maximum brunt of selling pressure. There was no respite in the final trading hour either and the indices closed below the dotted line. While the BSE-Sensex closed lower by around 67 points (down 0.4%), the NSE-Nifty closed lower by around 25 points (down 0.5%). The BSE Mid cap and the BSE Small cap were not spared either as they closed lower by 1% each.

As regards global markets, Asian indices across the board closed lower today while European indices have opened in the red. The rupee was trading at Rs 53.72 to the dollar at the time of writing.

Infrastructure financing major IDFC declared its FY12 (financial year 2012) results. The institution grew its income from operations and profits by 29% and 21% year over year respectively. Consolidated income from operations grows 29% YoY in FY12, on the back of a similar 28% YoY growth in advances. However, loan disbursements fell by 31% YoY, approvals by 25% YoY in FY12 on the back of a weak macro environment. IDFC's net interest margins (NIM) improved marginally to 4.3% in FY12 compared with 4.2% previously. Asset management fees saw a decline of 4% YoY, and its income from principal investments saw an increase of 83% YoY in FY12. IDFC's bottomline grew by 21% YoY in FY12 and 17% in 4QFY12. Higher other income and lower operating expenses helped buoy profits. Capital adequacy ratio stood at 20.8% at the end of FY12, compared with 24.5% at the end FY11.

Meanwhile textile and denim major Arvind Ltd (OTC:ARVNF) reported results for the fourth quarter and financial year 2011-12 (FY12). The company posted a rise of 11.5% YoY in its net profit in 4QFY12. Total income increased by 4.85% YoY for the same period. On the consolidated basis, the company has posted a rise of 5.8% YoY in its net profit on the back of 6.3% YoY growth in revenue for 4QFY12. Arvind witnessed a drop in operating margins in brands and retail business as it had to absorb part of higher inventory cost. Further sales were impacted by global slowdown, weak domestic retail demand, high volatility in cotton prices and foreign exchange and higher interest cost. The stock (down 13%) was the biggest loser amongst textile stocks today.