Mumbai: The Sensex and Nifty fell nearly half a percent on Friday. Earlier on Thursday, the market closed in red. The pressure on banking stocks increased due to the strict stand of the Supreme Court on the non-payment of revenue arrears of Rs 1.47 lakh crore by telecom companies.
The 30-share BSE Sensex fell 202.05 points, or 0.49 per cent, to close at 41,257.74. The 22 stocks included in the index closed at a loss. The NSE Nifty fell 61.20 points or 0.50 percent to close at 12,113.50. Banking, auto, FMCG and energy stocks were sold during the day.
The Supreme Court on Friday issued notices to the companies asking why no contempt proceedings should be taken against the telecom companies for not implementing the judicial order for payment of consolidated gross revenue (AGR) of Rs 1.47 lakh crore. The order saw pressure in the shares of banks lending to the telecom companies affected. Especially the pressure on the lenders of Vodafone Idea.
IndusInd Bank saw the biggest fall of 4.38 percent during this period. Apart from this, Powergrid, SBI, Hero MotoCorp and NTPC also closed down. On the other hand, Bharti Airtel was the top-growing share with a gain of 4.69 percent. Analysts predict that the Indian telecom industry is now moving to the executives of two private sector companies.
Vodafone Idea, which owes revenue of Rs 53,000 crore, lost 23.21 per cent. Traders say that the quality of the assets of banks may be affected by the Supreme Court’s order to telecom companies to pay arrears by March 17, as they have given substantial loans in this area. Vinod Nair, head of research, Geojit Financial Services, said banking stocks are under pressure due to heavy inflation and the Reserve Bank not having room to cut rates in the near future. Apart from this, the impact of the fall in global markets was also seen on the domestic market.
Auto sector stocks affected by the interest rates of banks were also under pressure as inflation based on wholesale prices rose to 3.1 percent in January. As a result, Hero MotoCorp shares fell 2.24 percent and Mahindra & Mahindra shares fell 1.91 percent. FMCG sector company ITC declined by 1.98 percent and AUL by 1.20 percent. There was pressure on the fears of inflation rising in these stocks. HCL, ICICI Bank, RIL and Tech Mahindra were among the rising stocks during this period. On a weekly basis, the Sensex declined by 115.89 points or 0.28 percent, while the Nifty gained 15.15 points or 0.12 percent.
