Bajaj Finance, ITC falls post Q3 results; L&T wins mega order & more

NIFTY50:  21,522 ▼ 215 (-0.9%)
 SENSEX: 71,139 ▼ 801 (-1.1%)

• Benchmark indices end lower amid profit booking in heavyweight stocks
• In all, 37 of the NIFTY50 stocks closed in the red
• Eurozone Q4 GDP remained flat at 0.0%, following a 0.1% contraction in the previous period 

Among the NIFTY sectoral indices, PSU Bank (+0.9%) and Media (+0.4%) were the top gainers, while FMCG (-1.0%) and Pharma (-0.8%) were the top losers.

What's Up

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Market Sentiment

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⭐ Muted Q3 earnings drag down ITC, Bajaj Finance

Shares of several NIFTY50 companies witnessed a substantial fall today. Bajaj Finance slipped 5.1% lower, while ITC was down 2.5%. This comes following the subdued Q3 results announcement by these companies. Bajaj Finance’s standalone Q3 net profit rose 21% YoY to ₹3,177 crore, but was below market expectations. Similarly, its net interest margin (NIM) fell by 11 basis points (bps) on a sequential basis, which raised investor concern. On the other hand, ITC reported a more than 10% YoY rise in its standalone net profit to ₹5,572 crore. However, its revenue from operations fell short of expectations due to muted growth in the cigarette business, as volumes slipped 2% YoY.  

⭐ Dr Reddy’s reports robust Q3 result

Pharma major Dr Reddy's Laboratories reported an 11% YoY rise in its consolidated net profit to ₹1,381 crore for the December quarter. Meanwhile, its revenue rose 6.6% to ₹7,237 crore aided by the strong performance of its generic drugs business in key markets like the US and Europe. Both net profit and revenue were above market estimates. 

⭐ L&T wins ‘mega’ order in the Middle East

Larsen & Toubro’s construction arm has secured a 'mega' engineering, procurement and construction (EPC) order to establish the renewable generation plant in the UAE. As per L&T's classification, orders in the range of ₹10,000 to ₹15,000 crore are considered 'mega' orders. This order involves the setup of an 1800MWac solar photovoltaic plant in Dubai. Despite a big order win, the company’s shares closed 1.8% lower today.  

⭐ Orchid Pharma hits upper circuit on drug approval

Shares of Orchid Pharma were locked in the 20% upper circuit today after its antibiotic drug, Exblifeb, received approval from the European drug regulator, the European Medicines Agency. The drug treats complicated urinary tract infections, pneumonia and bacteremia. The drug is estimated to generate global sales of around $200-300 million annually upon approval in other geographies. 

IPO Corner

⭐ On Day 1, the BLS E-Services Limited IPO received an overall subscription of 15.6 times, with the retail segment being subscribed 49.4 times. To know more and apply, click here.

⭐ EPACK Durable made a muted opening today as its shares were listed at a discount of 4% compared to its issue price. The stock debuted at ₹221 on the NSE as against an offer price of ₹230. 

Learn with Upstox

What is the net interest margin?

In simple terms, net interest margin (NIM) is the ratio of the net interest income (NII) to the total loans disbursed by a bank, where NII is the difference between the interest income received and interest paid on deposits. For example, suppose a bank gives out loans worth ₹100 crore in a year, on which it receives ₹9 crore as interest income. In the same year, the bank paid ₹3.5 crore as interest to its depositors. Thus, the NII is ₹5.5 crore and the NIM would be 0.055 or 5.5%. NIM is one of the key indicators used in the banking and financial services industry. A positive trend in NIM indicates that the bank is running profitably. 

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