More Stories

Informist, Wednesday, Oct. 9, 2024

By Anjana Therese Antony

MUMBAI – Long bets were added in the derivatives chain of Tata Consultancy Services ahead of its earnings for Jul-Sept, due Thursday. While the earnings growth is seen muted, analysts expect positive comments from the management on business outlook and demand trends for the following quarters. Premiums on out-of-the-money call options increased and those on puts declined, indicating that the stock may rise in the next session. 
 

The IT giant's consolidated net profit is seen rising nearly 4% sequentially to INR 125.14 billion in the September quarter and revenue is seen growing 2.4% to INR 641.35 billion, according to the average of estimates from 16 broking firms. Compared to the year-ago period, this would translate to growth of 10.3% in the bottom line and 7.4% rise in the top line.

"The IT sector growth is in the middle of its recovery, having bottomed out two quarters ago, and is expected to achieve a high single-digit (rise) over the next three quarters," HDFC Securities said in its earnings preview report. Analysts will focus on the reasons for the weakness in the US and the UK markets, business outlook, deal wins, and trends in discretionary spending by clients, among others. The Mumbai-based company will be the first among the top 500 listed companies in India to release its earnings for the September quarter.

Shares of TCS closed largely unchanged at INR 4,252.95 on the National Stock Exchange. Premiums on INR 4,250-4,500 call options of TCS expiring Oct. 31 rose 4-7% and those on INR 4,200-3,600 put contracts declined 8-22%. The maximum addition of open interest was at INR 4,400 call and INR 4,200 put. Open interest in the October futures contract increased 0.4% to 16.66 million. 

The overall equity market ended Wednesday's choppy session marginally lower. The Nifty 50 ended 0.1% lower at 24981.95 points and the BSE Sensex ended 0.2% lower at 81467.10 points. The near-term support for the 50-stock index is seen at 24800-24750 points and resistance at 25100-25250 points, according to technical and derivatives analysts. 

Analysts said overnight developments in global markets will set the tone for Indian equities Thursday in the absence of major domestic triggers. Foreign fund outflows to China, the simmering tension between Israel and Iran, and expensive valuations of Indian stocks are some of the reasons that have been pulling the equities lower recently. While the Reserve Bank of India changing its policy stance to 'neutral' from 'withdrawal of accommodation' is considered a good sign, the focus will continue to be on inflation data and economic growth, analysts said. 

In the Nifty 50 options chain, premiums across calls and puts declined ahead of the weekly expiry of these contracts Thursday. The maximum addition of open interest was seen at the 25500-point strike call and 24000-point strike put.

--Nifty 50 Oct closed at 25119.15, down 12.50 points; 137.20-point premium to spot index

--Nifty 50 Nov closed at 25258.25, down 15.70 points; 276.30-point premium to spot index

--Nifty 50 Dec closed at 25421.95, down 2.50 points; 440.00-point premium to spot index

HDFC Bank, ICICI Bank, State Bank of India, Reliance Industries, Divi's Laboratories, Axis Bank, Infosys, Dixon Technologies, Kotak Mahindra Bank, Bajaj Finance, Trent, ITC, and Bank of Baroda were the most actively traded contracts.  End

Edited by Rajeev Pai

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2024. All rights reserved.