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Informist, Thursday, Jul. 24, 2025

By Gopika Balasubramanium

MUMBAI – The benchmark equity indices ended lower Thursday, dragged down mainly by a fall in financial services and information technology stocks. Analysts said foreign investors maintained their short positions in the futures and options market on the day of expiry of the Nifty 50's weekly derivatives contract. The UK and India signed their free trade agreement, but the news did not change the course of the indices.

The Nifty 50 closed at 25062.10 points, down 157.80 points or 0.6%. Only 14 Nifty 50 constituents ended in the green Thursday. Two stocks--HDFC Bank and Eternal--hit their historical highs. The BSE Sensex closed at 82184.17 points, down 542.47 points or 0.7%.

Prime Minister Narendra Modi, who is on a two-day visit to the UK, signed the recently concluded free trade agreement with his UK counterpart Keir Starmer. Under the agreement, India has agreed to cut duties on 90% tariff lines while the UK will reduce duties on 99% tariff lines. In trade parlance, a tariff line refers to an item that is listed in a country's tariff schedule. India will also slash duty on automobile products imported from the UK to 10% from 100% under a fixed quota, which is likely to be implemented in a phased manner, according to news reports.

The overall market breadth was negative with 61% of the stocks listed on the NSE closing in the red. The broader market also felt the heat of heavy selling by traders. Small-cap indices fell more sharply than their mid-cap peers. Analysts had said these indices will be under selling pressure in the near term owing to subdued earnings and rich valuations. The Nifty Smallcap 50 closed 1.3% lower while the Nifty Midcap 50 closed 0.8% lower.

Among sectoral indices, the Nifty IT's fall was the sharpest, down 2.2% at 36135.80 points. All but one--Oracle Financial Services Software--of the 10 constituents of the index closed lower. Coforge, which missed the Street's view for both consolidated net profit and revenue from operations, closed 9.4% lower, down for the third straight session. Thursday's session saw the company's market capitalisation fall INR 58.11 billion to INR 560.66 billion.

Persistent Systems closed at INR 5,174, down 7.7%. Though the company's bottom line for the June quarter was in line with expectations, some analysts expressed concern over the slowdown in select segments such as health care. "...the delayed ramp-up and right-shifting of resources have led to the decline in Healthcare vertical," broking firm Prabhudas Lilladher said. Oracle Financial closed 1.8% higher. The company's consolidated net profit for the June quarter was down slightly but it reported an 8% sequential growth in sales.

Investors also reacted to the June quarter earnings of Nestle India and Dr. Reddy's Laborotaries. Dr. Reddy's closed 1.5% higher after rising 3.2% to an intraday high of INR 1,287.90. Analysts are bullish on the company's growth outlook despite its June quarter bottom line missing estimates. "While the numbers were a miss, we think all attention is on new growth drivers such as GLP-1s (glucagon-like peptides-1) and biosimilars," Nuvama Institutional Equities said in a report. JM Financial is also bullish on the company's launch pipeline.

Nestle India's shares closed 5.3% lower as the company's bottom line for the June quarter fell on year and missed consensus estimates. The company's net profit for the June quarter declined 12% on year. The net profit declined for the second successive quarter. The stock fell to a one-month low of INR 2,315.40 and lost INR 125.73 billion in market capitalisation.

Meanwhile, shares of Tata Consumer Products came off their intraday high to close 1% higher at INR 1,072.80. The stock had gained nearly 4% to INR 1,104.50 as the company's top line and bottom line for the June quarter rose on year, though its consolidated net profit was slightly below the consensus estimate. Some brokerages were positive on the company's strong revenue growth and potential margin recovery in upcoming quarters. "We remain strong believers in the top line growth opportunity in the organised packaged foods business in India and on TATACONS as a strong play on this theme," Nirmal Bang Equities said. The brokerage expects the company's margins to start recovering from the December quarter.

Indian Energy Exchange closed nearly 29.6% lower and was the worst-hit in the Nifty 500 index. The company's shares plunged over 30% intraday as the Central Electricity Regulatory Commission approved the implementation of "market coupling" norms with the Day Ahead Market. Brokerages said the company is likely to lose market share because of this move. The stock was down for the seventh straight session. In the past six days, it had fallen 11%. The company's market capitalisation plummeted INR 49.55 billion on Thursday and now stands at INR 117.99 billion.

Olectra Greentech closed 15.5% higher and was the top gainer in the Nifty 500 index. The stock was up for the third consecutive session and has gained 21% in this period. Thursday, the company added INR 16.83 billion to its market capitalisation, which is now at INR 108.95 billion.

* Of the Nifty 50 stocks, 14 rose, 35 fell and one was unchanged

* Of the Sensex stocks, 5 rose and 25 fell

* On the NSE, 1,111 stocks rose, 1,863 fell, and 84 were unchanged

* On the BSE, 1,645 stocks rose, 2,410 fell, and 166 were unchanged

* Nifty IT: down 2.2%; Nifty FMCG: down 1.1%; Nifty PSU Bank: up 1.2%.

BSE                                               NSE

Sensex: 82184.17, down 542.47 points or 0.7%      Nifty 50: 25062.10, down 157.80 points or 0.6%

End

Edited by Rajeev Pai

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