Sensex takes 130-point hit on disappointing Infosys earnings

October 12, 2012 04:46 pm | Updated October 18, 2016 01:10 pm IST - Mumbai

A file picture of Bombay Stock Exchange in Mumbai. Photo: Vivek Bendre.

A file picture of Bombay Stock Exchange in Mumbai. Photo: Vivek Bendre.

The Sensex on Friday dropped by nearly 130 points to close at 18,675.18 on lower-than-expected Infosys earnings and a cut in its full-year sales guidance, amid slowing industrial production growth in August.

The BSE benchmark index opened nearly 78 points lower dragged down by Infosys scrip which tanked nearly 8 per cent on reports the IT major’s July-September quarter revenues and profits failed to beat market expectations.

Infosys posted 24.3 per cent jump in consolidated net profit at Rs 2,369 crore while its revenues were up 21.7 per cent at Rs 9,858 crore. The scrip pared some losses to close at Rs 2,395.65, down 5.36 per cent.

The Sensex, which had climbed 174 points in the previous session, closed lower by 129.57 points, or 0.69 per cent to 18,675.18. Infosys, Wipro and Bharti Airtel were major losers.

Brokers said market sentiment was hit due to a cut in Infosys’ profit margin and sales outlook.

Infosys lowered its revenue growth guidance for the current financial year to 17.3 per cent from the earlier target of 19.7 per cent, setting off alarm bells.

“It was a down day for markets...for fourth quarter in a row, Infosys’ stock crashed post results. Infosys guided about challenging times and trimmed down its FY13 guidance,” said Nagji K Rita, CMD, Inventure Growth & Securities.

Dealers said industrial production growth slowing to 2.7 per cent in August compared to 3.4 per cent in the same month last year, also upset market participants.

“We do not believe this IIP data will have a bearing on the policy stance, although inflation data (on Monday) will still be crucial,” said Kapil Gupta, analyst, Edelweiss.

The Sensex staged a partial recovery from the day’s low levels on the back of over 1 per cent gain in HDFC Bank shares as the lender posted 30 per cent rise in quarterly profit.

In 30-share Sensex, 16 stocks declined while 14 scrips including GAIL, Tata Power and Hindalco ended higher.

The 50-share National Stock Exchange index Nifty fell by 32 points, or 0.56 per cent to 5,676.05, after touching the day’s low of 5,659.35.

0 / 0
Sign in to unlock member-only benefits!
  • Access 10 free stories every month
  • Save stories to read later
  • Access to comment on every story
  • Sign-up/manage your newsletter subscriptions with a single click
  • Get notified by email for early access to discounts & offers on our products
Sign in

Comments

Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.

We have migrated to a new commenting platform. If you are already a registered user of The Hindu and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.