Jindal Drilling plummets 7% & More on Today’s Market

Jindal Drilling plummets 7%

On August 2, Jindal Drilling and Industries witnessed a sharp decline in its shares, trading over 7 percent lower in morning trade, following the company's announcement of a significant 60 percent drop in net profit for the quarter ending June 2023. According to the post-market hours regulatory filing on August 1, the company's consolidated net profit plummeted to Rs 12.07 crore from Rs 30.12 crore in the same period of FY23. Additionally, the net income from operations experienced a decline of 29 percent, amounting to Rs 93.95 crore compared to Rs 132.71 crore in Q1 FY23, while the profit before tax also contracted by 54.72 percent to Rs 18.85 crore, as opposed to Rs 41.63 crore in the corresponding quarter of the previous year. As a result, the company's shares were trading at Rs 385.45 on the BSE, down by 7.22 percent at 11:20 am.

Godrej Properties Q1 show disappoints Street

On August 2, Godrej Properties saw a decline of approximately 2 percent in its shares during the afternoon trading session, following the company's report of a sequential decrease in both revenue and profit for the June quarter of the current financial year. The quarter-on-quarter net profit experienced a substantial 70 percent drop, amounting to Rs 125 crore, while revenue also declined by 32 percent to Rs 1,315 crore. However, on a year-on-year basis, the company's performance was notable, with profit witnessing a significant rise of 174 percent and revenue soaring by 251 percent. Despite a YoY decline in total bookings by 11 percent, the company achieved sustenance sales growth of 19 percent to reach Rs 1,816 crore, attributed to the launch of three new projects/phases during the April-June period. Notably, Godrej Properties also added four new projects, encompassing a total estimated saleable area of 3.7 million sq ft and an estimated booking value of Rs 6,450 crore. By 1 pm on the same day, the stock was trading at Rs 1,659.80 on the BSE, down by 2 percent from the previous close.

Chola Finance's margin compression could be a roadblock

Cholamandalam Investment & Finance Company reported a notable 28 percent increase in consolidated net profit for the April-June quarter of FY24. However, concerns arose among brokerages due to margin compression during the same period. The company's margins contracted from 8 percent in the year-ago quarter to 7.3 percent, primarily attributed to higher borrowing costs. Chola Finance experienced a rise in the cost of funds, which went up to 6.9 percent from 5.5 percent in Q1 FY23. As a consequence, at 11 am, the company's stock was trading at Rs 1,114.90 on the NSE, reflecting a 1.4 percent decrease from the previous close. Remarkably, trading volumes surged to 5,195,638 shares, over four times the 20-day average volumes.

Shriram Housing Finance to raise Rs 300-500 cr

In an exclusive interview on August 2, Shriram Housing Finance's Chief Financial Officer, GS Agarwal, revealed the company's plan to raise Rs 300-500 crore through the National Housing Bank's (NHB) refinancing scheme in Q2FY24. During Q1FY24, the company had already raised Rs 740 crore through NHB refinancing, forming a significant portion of its total borrowing of Rs 2,000 crore during that period. Agarwal also mentioned that the company's cost of funds is expected to increase by 15-20 basis points in Q2FY24 due to the higher cost of debt raised 2-3 years ago, which is now due for maturity.

Conclusion

The Indian stock market witnessed a bearish trend on August 2, with all major indices closing in the red. The NIFTY 50, SENSEX, and NIFTY BANK indices fell by 1.05%, 1.02%, and 1.31%, respectively. The sell-off affected all sectors, with the IT sector, banking sector, and consumer discretionary sector being the biggest losers. Two notable companies, Jindal Drilling and Industries, and Godrej Properties, experienced significant declines in their shares due to disappointing financial results. Jindal Drilling reported a 60 percent drop in net profit, while Godrej Properties recorded a sequential decline in revenue and profit for the June quarter. Cholamandalam Investment & Finance Company's margin compression raised concerns among brokerages, although it reported a 28 percent increase in consolidated net profit. On the other hand, Shriram Housing Finance disclosed plans to raise funds through the National Housing Bank's refinancing scheme. Overall, the market's performance highlighted investors' cautious approach amid economic uncertainties and company-specific challenges.

Source - Moneycontrol