Sensex and Nifty lost 3 percent each in the past week amid fresh crisis in the financial sector which dampened the positive sentiment brought after the cut in the corporate tax rate.
The Reserve Bank of India’s repo rate cut also did not bring any cheer for the Indian markets, which were under pressure due to fresh concerns over global trade.
The RBI’s monetary policy committee on October 4 slashed rates by 25 bps and kept the stance accommodative to revive growth in Asia’s third-largest economy.
In the last week, the Sensex plunged 1,149.26 points (down 2.9 percent) to end at 37,673.31, while Nifty shed 337.6 points (down 2.9 percent) at 11,174.8.
The S&P BSE Midcap index declined by 3.87 percent and S&P BSE Largecap index fell by 3.11 percent, while the Smallcap Index was down by 3.92 percent in the past week.
Here is a list of 10 stocks which moved most in the week gone by: DHFL | Down 26 percent
Shares of Dewan Housing Finance Corporation (DHFL) plunged 26 percent in last week on the back of report of possible exposure to HDIL and Punjab & Maharashtra Co-operative Bank (PMC Bank).
However, the company in BSE release clarified that DHFL does not have any exposure to either of them.
DHFL’s promoter family had separated from HDIL promoters in 2008 and the separation was effected formally by a family-separation agreement in April 2010. Pursuant to this, the promoters of DHFL and HDIL ceased to be promoters of each other’s companies, it further added.
On September 27, 2019, the company held a meeting to present the draft resolution plan to all its institutional creditors including banks, financial institutions, mutual funds, insurance companies and other institutional bondholders, and to apprise them of the various steps required to be undertaken to implement the resolution plan of the company.
The company has appointed Vaijinath M Gavarshetty as the chief executive officer and key managerial personnel of the company with effect from October 1.
The company in its AGM held on September 28 approved an amendment to the memorandum and articles of association of the company by approving an increase in the authorised share capital of the company from Rs 828 crore to Rs 1,090 crore.
Lakshmi Vilas Bank | Down 18 percent
Lakshmi Vilas Bank shares remained under pressure after it informed that RBI initiated prompt corrective action plan with effect from September 27.
However, the bank reassured all customers that it could transact normal business and there is no restriction on operations by depositors. The bank can also undertake lending activities to all the segment except corporates and other stressed and high-risk sectors, it said.
The bank has revised the Marginal Cost of Funds based Lending Rate (MCLR) and adoption of RBl’s policy Repo Rate as external Benchmark rate for linking to all new floating rate personal or retail loans (housing, auto, etc.) and floating rate loans to Micro and Small Enterprises extended by the Bank with effect from October 1.
The bank’s director Supriya Prakash Sen has resigned from the post on October 2.
The Economic Offences Wing (EOW) has registered an FIR against the bank based on the complaint of Religare Finvest related to an adjustment of their deposits to the dues of RHC Holding and Ranchem Private.
HDIL | Down 18 percent
Housing Development and Infrastructure (HDIL) share price tanked 18 percent after company promoters were arrested after the discovery of dubious loans with PMC Bank.
Rakesh Wadhawan and his son Sarang Wadhawan, accused of loan default, were arrested by the EOW, PTI reported. The duo will remain in custody until October 9.
EOW had also frozen HDIL’s properties worth Rs 3,500 crore.
The company is at the centre of the PMC Bank crisis, as it had borrowed a substantial amount from the lender.
Indiabulls Housing Finance | Down 37 percent
Shares of Indiabulls Housing Finance fell as much as 37 percent on concerns over its merger with Lakshmi Vilas Bank, which the RBI has placed under the prompt corrective action plan.
The RBI’s action could be a setback to the bank’s merger with housing finance firm Indiabulls Housing Finance in a share-swap deal that was announced in April. The proposed merger still awaits the RBI’s approval.
Besides, public interest litigation (PIL) was filed against the company on September 27 in the Delhi High Court, alleging round-tripping of funds by the company which deserves to be heard.
In a BSE filing on September 27, the company said it has filed an application before the Delhi High Court “for perjury and misrepresentation under oath against Prashant Bhushan for willfully filing a PIL full of false and incorrect information and thereby causing willful reputational loss to the company.”
Reliance Capital | Down 19 percent
Brickwork has downgraded the rating to BWR D for the company’s secured non-convertible debenture (NCDs) programme, market-linked debentures and subordinated debt of the company due to alleged delay in payment of interest by a day.
The company completed the sale of 21.54 percent stake in its mutual fund arm Reliance Nippon Life Asset Management (RNAM) to joint venture partner Nippon Life Insurance for Rs 3,030 crore.
Reliance Anil Dhirubhai Ambani Group (ADAG) Chairman Anil Ambani on September 30 while addressing its AGM said that the company is not going to be in the lending business any longer.
Over the last 15 months, Ambani said, the company had repaid more than Rs 35,000 crore in debt. He claimed the company is going to repay an additional Rs 15,000 crore by March 2020, even though there is no funding.
RBL Bank | Down 17 percent
The stock fell more than 17 percent in last week over concerns of its exposure to troubled Indiabulls Housing Finance.
Vishwavir Ahuja, its Managing Director and CEO, in an interview to CNBC-TV18, said its exposure to the Indiabulls Group stands between 0.25 percent and 0.5 percent of its total loan book.
“There seems to be some malicious speculation going on. All I want to say is that nothing has materially changed from three months back and the bank continues to be in good shape. We are growing and continue to remain profitable,” Ahuja stated.
CARE Ratings has reaffirmed the rating of CARE AA- (Stable) for the Basel Ill Compliant Tier II Bonds programme of the bank for Rs 800 crore.
The meeting of the board of directors of the bank is scheduled to be held on October 22, to consider and approve the unaudited standalone and consolidated financial results for the quarter/half ended September 30, 2019 subject to a limited review by the statutory auditor of the bank.
BPCL | Up 9 percent
The stock has gained traction after reports emerged that the government was planning to sell its stake in the company. The government holds 53.29 percent equity in BPCL, which translates to about Rs 57,000 crore.
Global financial firm Citi has maintained a buy rating on BPCL, putting the company on the top of the pecking order of oil marketing companies.
The international Credit Rating Agency Moody’s on October 3 warned of downgrading Bharat Petroleum Corporation (BPCL) to Ba1 if the government goes ahead with privatisation by selling its stake to a private entity.
Biocon | Up 6 percent
Biocon and Mylan NV announced the launch of Semglee (insulin glargine solution for injection 100 IU/mL in a 3mL pre-filled pen), the first insulin glargine biosimilar in Australia available on the Pharmaceutical Benefits Scheme (PBS).
The meeting of the board of directors of the company is scheduled on October 23, to consider and approve the un-audited standalone and consolidated financial results for the quarter and half year ended September 30, amongst other routine matters.
Info Edge | Up 10 percent
Last week shares of Info Edge India gained over 10 percent after a media report talked about a fundraising plan from Zomato.
“Online food delivery and restaurant discovery platform Zomato is finalising a fresh $600-million round of fundraising likely to be led by existing Chinese investor, Ant Financial,” The Economic Times said quoting people in the know.
Singapore’s sovereign fund Temasek is also expected to put in a significant amount of capital as part of the fund infusion that will further intensify the battle between Zomato and Swiggy, the report added.
Zee Entertainment Enterprises | Down 13 percent
The share price remained under pressure after global brokerage Morgan Stanley slashed its target price by 33 percent amid debt concerns.
The stock has lost nearly half of its value in the past year amid corporate governance issues.
Morgan Stanley has an underweight rating on the stock. It cut the target price to Rs 248 from Rs 370 per share earlier, saying the uncertainty may continue as the promoter debt issue lingered. Get access to India’s fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.