Indian bourse down in a row troubled by a series of defaults

Looking like the last day of the losing streak for the markets, Thursday’s trading session, however, proved no different that the developments over the past five days.

Markets closed in the red for the sixth day in a row troubled by a series of defaults by DHFL and Cox and King and uninspiring quarterly results.

Besides, investors have already been under pressure owing to the slowdown concerns, very visible in the performance of steel companies while the exodus of foreign funds seems to be nearing the sell-off in October last year.

The Sensex closed 16.67 points lower at 37,830.98 from its Wednesday’s close of 37,847.65, while the Nifty fell by 19.15 points to 11,252.15.

Tata Motors saw its worst day on the bourses in nearly an year, ahead of its June quarter corporate results. The previous 2-3 quarters have been tough for auto companies who have been feeling the pinch of the consumption slowdown.

“We had a flat opening today owing to mixed global cues. However, during the first half an hour of the trade, we saw strong bout of buying to push the index near yesterday’s high of 11359.75,” said Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel Broking.

“In fact, in this process, Nifty managed to surpass it by a small margin and then similar to recent trend, this lead got sold into. Thereafter, the index struggled throughout the remaining part of the day to eventually conclude the July series at a two month low,” Chavan added.

Meanwhile, the Anil Ambani-led Reliance Capital Ltd on Thursday said it has fully repaid its outstanding commercial paper (CP) of Rs 75 crore and cut its CP dues to zero.

In a statement, the company said it has repaid the CP outstanding of Rs 75 crore on Wednesday.

“With the above repayment, the CP outstanding stands at zero from the peak outstanding amount of approximately Rs 3,500 crore,” the statement said.

The CPs were rated ‘A4’ by ICRA and the same have been repaid in full on the due dates.

Meanwhile, Xiaomi-led India market hit 37mn smartphone shipments in Q2. Chinese handset maker Xiaomi grabbed the top spot in the second quarter (Q2) of 2019 with a 28 per cent share as smartphone shipments in India grew to 37 million units, setting a second-quarter shipment record, a new report by Counterpoint Research said on Thursday.

China’s BBK Group that includes smartphone brands OPPO, vivo, Realme and OnePlus became the leading smartphone manufacturer in India for the first-time ever, capturing a combined share of 30 per cent, according to Counterpoint’s “Market Monitor service” report.

Samsung’s shipments declined by 7 per cent YoY, but, it has shown 30 per cent growth QoQ driven by refreshed A series and M series.

Huawei’s trade ban impacted India market as its shipments declined year on year (YoY), but, the brand continues to be in the top ten smartphone brands category. The India growth was driven by new launches, price cuts on older devices and channel expansion across brands.

“Brands which focused on offline channels expanded to online channels with online-exclusive series. Similarly, brands which entered the market with online-exclusive series are now expanding their reach towards offline channel by forming partnerships with key offline retailers. This strategy is working well for all the leading at-scale players,” Tarun Pathak, Associate Director, Counterpoint Research, said in a statement.

“Also, brands are launching multiple series to target or expand into new product tiers. This is helping them to expand their product portfolio to target multiple fast-growing segments and also diversify.” In the premium segment, OnePlus surpassed Samsung to become the number one player driven by strong demand for its newly launched OnePlus 7 series while Realme, ASUS, OnePlus and Nokia HMD were the fastest growing brands (YoY).

“The top five brands’ contribution to the total shipments volume reached its highest ever level driven by new launches and hybrid channel strategy. Localisation, branding, and innovation will remain to be the next key drivers for growth in a highly competitive market like India.

“The market will continue to become more concentrated with majority of share controlled by a few brands leading to more number of exits among the long-tail brands in the market moving forward,” said Anshika Jain, Research Analyst at Counterpoint Research.

This is the third consecutive quarter that Realme has grabbed a spot within the top five brands driven by strong performance of Realme C2 and Realme 3 Pro and discount offers rolled out on online platforms.

Realme C2 crossed one million mark within a couple of months of launch. It became the fastest brand to reach 8 million smartphone shipments in India market within one year of its debut.

Indo-Asian News Service