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Thursday,21-October-2021

Business

BFSI, commodities expected to drive FY22 earnings: MOFSL

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Indian-Rupee

India’s banking, financial services and insurance (BFSI) sector along with commodities are expected to drive FY22 earnings, said Motilal Oswal Financial Services (MOFSL) in a report.

Accordingly, MOFSL has placed BFSI, IT, metals, and cement in the ‘OW’ (overweight) category in its model portfolio.

Besides, it has placed consumer, auto, healthcare, and capital goods in ‘Neutral’ category and ‘UW’ (underweight) on O&G and infrastructure sectors.

“Corporate earnings in 4QFY21 were led by cyclicals and a combination of low base and strong demand revival as economic activity improved. Corporate India displayed tremendous resilience in FY21, with the Nifty ending the year with a healthy (14 per cent) earnings growth, which was unthinkable a year back,” the report said.

“The second Covid wave in April-May, 2021 has soured sentiments and impacted economic activity. Since the restrictions this time were localized and less stringent versus the lockdown in CY20, we expect the impact in 1QFY22 to be contained.”

According to the report, earnings momentum is expected to accelerate in FY22 as the pace of vaccinations picks up and the economy opens up further.

“BFSI and commodities are expected to drive FY22E earnings. The market has been strong and largely looked through the second Covid wave on the back of strong liquidity and robust participation from non-institutional investors.”

“The recent commentary by the (US) Fed on earlier than anticipated tapering and India’s elevated CPI print have rattled some nerves, even as equity-bond yield dynamics are not showing any red flags.”

As per statement, Nifty valuations at ’21x FY22E EPS’ are rich and demand consistent earnings delivery ahead.

“Corporate earnings in the last quarter of FY21 continued the momentum of the preceding two quarters and ended the year on a good note, aided by the deflated base in 4QFY20 and healthy demand recovery for a large part of 4QFY21.”

“However, 1QFY22 has seen a familiar disruption, with the second COVID wave engulfing India and several states imposing lockdowns in Apr’21 and May’21.”

In addition, the trend of earnings revision has changed in favor of downgrades again in 4QFY21 after two consecutive quarters (2Q and 3QFY21) of upgrades.

“The downgrade-to-upgrade ratio stood at 1.6:1. The second COVID wave peaked in May’21 and active cases are currently 80 per cent below its peak.”

“Daily cases are trending at a three-month low. With the pace of vaccinations picking up and states unlocking again, confidence is gradually returning in corporate commentaries as we exit 1QFY22.”

Business

No increase in fuel prices for 2nd consecutive day on Tuesday

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Petrol

 Petrol and diesel prices remained unchanged for the second consecutive on Tuesday providing relief to consumers who have been facing a regular increase in fuel prices in the past few months taking the retail rates to historic high levels.

With no revision, the price of petrol in Delhi remained Rs 105.84 a litre and Rs 111.77 per litre in Mumbai, according to a price notification of state-owned fuel retailers. In Mumbai, diesel rates also remained static at Rs 102.52 a litre; while in Delhi it costs Rs 94.57, the same as on Sunday.

The price pause comes after the rates rose for four straight days when the rates of both petrol and diesel rose by Rs 1.40 paise per litre. There was no change in the rates also on October 12 and 13.

Diesel prices have increased on 19 out of the last 25 days taking up its retail price by Rs 5.95 per litre in Delhi.

With diesel prices rising sharply, the fuel is now available at over Rs 100 a litre in several parts of the country. This dubious distinction was earlier available to petrol that had crossed Rs 100 a litre-mark across the country a few months earlier.

Petrol prices had maintained stability since September 5, but oil companies finally raised the pump prices last week. Petrol prices have also risen on 16 of the previous 21 days taking up the pump price by Rs 4.65 per litre.

Crude prices have been on a surge rising over a three-year high level of over $ 85.7 a barrel now. It has softened a bit, falling below $ 85 a barrel now. Since September 5, when both petrol and diesel prices were revised, the price of petrol and diesel in the international market is higher by around $9-10 per barrel as compared to the average prices during August.

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Business

Markets open on a positive note

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Bombay-Stock-Exchange

 The 30-scrip Sensitive Index (Sensex) on Tuesday opened on a positive note during the morning trade.

The Sensex of the BSE opened at 62,156.48 points and touched a high of 62,159.29 points. The Sensex touched a low of 61,964.41 points.

On Monday, the Sensex closed at 61,765.59 points.

The Sensex is trading at 62,061.59 points, up by 296.00 points or 0.48 per cent.

On the other hand, the broader 50-scrip Nifty at National Stock Exchange (NSE) opened at lower note at 18,602.35 points after closing at 18,477.05 points.

The Nifty is trading at 18,549.55 points in the morning.

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Business

Petrol, diesel prices rise again, burn bigger holes in consumers’ pockets

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Petrol

 Petrol and diesel price rose again on Friday taking its retail rates to record high levels across the country affecting consumers this festive season.

Accordingly, in the national capital, petrol and diesel prices increased by 35 paisa per litre to Rs 105.14 per litre and Rs 93.87 per litre, respectively.

In India’s financial capital of Mumbai, petrol became costlier by 34 paisa per litre to Rs 111.09 a litre on Friday, the highest across all the four metro cities. Diesel also costs Rs 101.77 for one litre in Mumbai.

The price hike on Friday is for a second consecutive day after the rates remained static on Tuesday and Wednesday.

Diesel prices now have increased on 17 out of the last 21 days taking up its retail price by Rs 5.25 per litre in Delhi.

With diesel price rising sharply, the fuel is now available at over Rs 100 a litre in several parts of the country. This dubious distinction was earlier available to petrol that had crossed Rs 100 a litre mark across the country a few months earlier.

Petrol prices had maintained stability since September 5 but oil companies finally raised its pump prices last week and this week given a spurt in the product prices lately. Petrol prices have also risen on 14 of the previous 17 days taking up its pump price by Rs 3.95 per litre.

OMCs had preferred to maintain their watch prices on global oil situation before making any revision in prices. This is the reason why petrol prices were not revised for last three weeks. But extreme volatility in global oil price movement has now pushed OMCs to effect the increase.

Crude price has been on a surge rising over three year high level of over $84.5 a barrel now. Since September 5 when both petrol and diesel prices were revised, the price of petrol and diesel in the international market is higher by around $9-10 per barrel as compared to average prices during August.

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