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Economic Times
22-07-2025
- Business
- Economic Times
Why did RIL's shares plummet despite analysts' positive projections?
Jani said Q1 results for O2C and retail businesses were below market expectations, while telecom unit results were in line with expectations. Synopsis Reliance Industries' shares experienced a decline of over 3% on Monday. This followed the release of Q1 earnings that were lower than anticipated. Investors reacted to the results and a deferred IPO plan. Despite the dip, brokerages maintain a positive outlook on the company. They foresee potential growth triggers in the near future. Mumbai: Shares of Reliance Industries dropped over 3% on Monday as investors weighed the conglomerate's lower-than-expected Q1 earnings against analysts' positive outlook on stock after results. Stock ended at ₹1,428.6 on Monday, down 3.2%, capping gains in Sensex and Nifty, which ended 0.5% higher. ADVERTISEMENT "Reliance shares had recently rallied on expectations of strong quarterly results and a potential IPO announcement for its telecom business," said Sumit Pokharna, VP, fundamental research, Kotak Securities. "But, the management's clarification the IPO is deferred to next year had earlier led to some correction, and combined with results below Street estimates, we saw some profit-booking." The stock has gone up about 17% so far this year, against Nifty's 5.7% gains. PAT in June quarter stood at ₹30,681 crore, up 36.8% from January-March. Its revenues from operations stood at ₹2,48,660 crore, down 6% from previous quarter. It had recorded a one-time gain from selling its stake in Asian Paints for nearly ₹8,900 crore. Brokerages remain positive on company, with most retaining 'buy' and 'add' ratings post results. Price targets imply an upside of 8-19% from current levels. "We see 3 growth triggers for RIL in near term: scale-up of new energy business; Jio tariff hikes; and potential IPO/listing for Jio which has now been pushed beyond 2025," said Nomura. The stock may underperform in near term. "In absence of clear catalysts, stock may remain a laggard," said Hemang Jani, director at Finazenn. Jani said Q1 results for O2C and retail businesses were below market expectations, while telecom unit results were in line with expectations. (You can now subscribe to our ETMarkets WhatsApp channel) Nikita Papers IPO opens on May 27, price band set at Rs 95-104 per share Nikita Papers IPO opens on May 27, price band set at Rs 95-104 per share Why gold prices could surpass $4,000: JP Morgan's bullish outlook explained Why gold prices could surpass $4,000: JP Morgan's bullish outlook explained Cyient shares fall over 9% after Q4 profit declines, core business underperforms Cyient shares fall over 9% after Q4 profit declines, core business underperforms L&T Technology Services shares slide 7% after Q4 profit dips L&T Technology Services shares slide 7% after Q4 profit dips Trump-Powell standoff puts U.S. Rate policy in crosshairs: Who will blink first? Trump-Powell standoff puts U.S. Rate policy in crosshairs: Who will blink first? SEBI warns of securities market frauds via YouTube, Facebook, X and more SEBI warns of securities market frauds via YouTube, Facebook, X and more API Trading for All: Pi42 CTO Satish Mishra on How Pi42 is Empowering Retail Traders API Trading for All: Pi42 CTO Satish Mishra on How Pi42 is Empowering Retail Traders Security, transparency, and innovation: What sets Pi42 apart in crypto trading Security, transparency, and innovation: What sets Pi42 apart in crypto trading Bitcoin, Ethereum, or Altcoins? How investors are structuring their crypto portfolios, Avinash Shekhar explains Bitcoin, Ethereum, or Altcoins? How investors are structuring their crypto portfolios, Avinash Shekhar explains The rise of Crypto Futures in India: Leverage, tax efficiency, and market maturity, Avinash Shekhar of Pi42 explains NEXT STORY
Time of India
22-07-2025
- Business
- Time of India
Why did RIL's shares plummet despite analysts' positive projections?
Mumbai: Shares of Reliance Industries dropped over 3% on Monday as investors weighed the conglomerate's lower-than-expected Q1 earnings against analysts' positive outlook on stock after results. Stock ended at ₹1,428.6 on Monday, down 3.2%, capping gains in Sensex and Nifty, which ended 0.5% higher. "Reliance shares had recently rallied on expectations of strong quarterly results and a potential IPO announcement for its telecom business," said Sumit Pokharna, VP, fundamental research, Kotak Securities. "But, the management's clarification the IPO is deferred to next year had earlier led to some correction, and combined with results below Street estimates, we saw some profit-booking." The stock has gone up about 17% so far this year, against Nifty's 5.7% gains. PAT in June quarter stood at ₹30,681 crore, up 36.8% from January-March. Its revenues from operations stood at ₹2,48,660 crore, down 6% from previous quarter. It had recorded a one-time gain from selling its stake in Asian Paints for nearly ₹8,900 crore. Explore courses from Top Institutes in Select a Course Category Public Policy Design Thinking MBA Others Operations Management Technology Management Finance Data Science Leadership Healthcare Project Management Data Analytics Data Science Product Management Degree CXO others Cybersecurity MCA Digital Marketing healthcare Artificial Intelligence PGDM Skills you'll gain: Economics for Public Policy Making Quantitative Techniques Public & Project Finance Law, Health & Urban Development Policy Duration: 12 Months IIM Kozhikode Professional Certificate Programme in Public Policy Management Starts on Mar 3, 2024 Get Details Skills you'll gain: Duration: 12 Months IIM Calcutta Executive Programme in Public Policy and Management Starts on undefined Get Details Agencies Brokerages remain positive on company, with most retaining 'buy' and 'add' ratings post results. Price targets imply an upside of 8-19% from current levels. "We see 3 growth triggers for RIL in near term: scale-up of new energy business; Jio tariff hikes; and potential IPO/listing for Jio which has now been pushed beyond 2025," said Nomura. The stock may underperform in near term. "In absence of clear catalysts, stock may remain a laggard," said Hemang Jani, director at Finazenn. Jani said Q1 results for O2C and retail businesses were below market expectations, while telecom unit results were in line with expectations. ETMarkets WhatsApp channel )
Economic Times
10-07-2025
- Business
- Economic Times
Dollar's slide may help IT add 70–300 basis points to Q1 revenues
ETtech Currency is set to overshadow volumes as growth drivers in the June-quarter toplines at Indian tech powerhouses, with a falling dollar giving the anticipated tepid sales some much-needed ballast amid an evident revenue slack in the industry's traditional money spinners either side of the Atlantic.A retreat for the dollar, which gives the rupee a tailwind, should boost Indian tech revenues by 70-300 basis points in the June quarter, analysts said. One basis point is a hundredth of a percentage point. The currency impact cited above, therefore, should expand revenues by 0.7 to 3 percentage the April-June quarter, most major currencies have appreciated on average versus the US Dollar (USD). For instance, the Indian Rupee (INR) appreciated 1%, the Pound Sterling (GBP) 6.2%, the Euro (EUR) 8%, the Australian Dollar (AUD) 2.6% and the Japanese Yen (JPY) grew 5.5%. A weak dollar against a basket of currencies will lead to 100-200 bps of on-quarter cross-currency tailwinds, Motilal Oswal said in a report. HSBC Global Research estimates the impact to range between 80-450 basis points. These movements are higher for companies with greater exposure to EUR, GBP and JPY such as Tata Consultancy Services (TCS), HCL Technologies, Coforge, KPIT, data from Kotak Institutional Equities showed. Currency movements are crucial because Indian IT firms earn a large share of their revenues in foreign currencies but spend in INR -- most of it on employee wages in India. Typically, a stronger dollar helps gain more revenues as most IT majors' over 40-50% revenue comes from the US. However, when the dollar weakens against other currencies such as GBP, EUR, or JPY, revenues earned in those regions helps boost the reported toplines in instance, India's largest software service provider, TCS, has the least dollar dependency among tier-1 companies and derives 50% of its revenues from non-USD currencies. It is expected to net a 211 basis points revenue upside in the second quarter of the ongoing fiscal. The maximum positive impact could be recorded by mid-sized firm KPIT at 299 basis points because it derives a substantial 72% of its revenues from non-USD markets, data by Kotak Institutional Equities showed."During the quarter, the Indian rupee has appreciated around 1% against the dollar which typically is not beneficial for exporters,' said Sumit Pokharna, IT analyst with Kotak Securities. 'However, the rupee has depreciated against other currencies in the 2.5-8% range. This is providing tailwinds for software services exporters on the US$ revenue growth from the previous quarter.'He added that tighter controls by companies on travel costs and hikes and some pulling back on compensation, will aid margins stability for large IT companies while expansion for select mid IT at a time when discretionary spending remains muted, and deal closure timelines are elongated, the exposure to other currencies is helping IT firms, Pokharna the flip side, companies like Persistent Systems and Mphasis, which have among the highest exposure to the US at 85% and 82%, respectively, the sequential benefit of the currency movement will be contained at 69 basis points and 75 basis points, respectively. Elevate your knowledge and leadership skills at a cost cheaper than your daily tea. Markets need to see more than profits from Oyo Can Grasim's anti-competition charge against Asian Paints stand amid intense war Engine fuel switches or something else? One month on, still no word on what crashed AI 171 Delhivery survived the Meesho curveball. Can it keep on delivering profits? Stock Radar: Page Industries breaks out from Cup & Handle formation; stock hits fresh 52-week high For risk-takers with ability to stay invested for the long term: 5 small-caps from different sectors with upside potential of 5 to 32% Multibagger or IBC - Part 14: This auto ancillary with double-digit net margins is now getting EV-focused These mid-cap stocks with 'Strong Buy' & 'Buy' recos can rally over 25%, according to analysts
Time of India
10-07-2025
- Business
- Time of India
Dollar's slide may help IT add 70–300 basis points to Q1 revenues
Academy Empower your mind, elevate your skills ETtech Currency is set to overshadow volumes as growth drivers in the June-quarter toplines at Indian tech powerhouses, with a falling dollar giving the anticipated tepid sales some much-needed ballast amid an evident revenue slack in the industry's traditional money spinners either side of the Atlantic.A retreat for the dollar, which gives the rupee a tailwind, should boost Indian tech revenues by 70-300 basis points in the June quarter, analysts basis point is a hundredth of a percentage currency impact cited above, therefore, should expand revenues by 0.7 to 3 percentage the April-June quarter, most major currencies have appreciated on average versus the US Dollar (USD). For instance, the Indian Rupee (INR) appreciated 1%, the Pound Sterling (GBP) 6.2%, the Euro (EUR) 8%, the Australian Dollar (AUD) 2.6% and the Japanese Yen (JPY) grew 5.5%.A weak dollar against a basket of currencies will lead to 100-200 bps of on-quarter cross-currency tailwinds, Motilal Oswal said in a report. HSBC Global Research estimates the impact to range between 80-450 basis points. These movements are higher for companies with greater exposure to EUR, GBP and JPY such as Tata Consultancy Services (TCS), HCL Technologies Coforge , KPIT, data from Kotak Institutional Equities movements are crucial because Indian IT firms earn a large share of their revenues in foreign currencies but spend in INR -- most of it on employee wages in India. Typically, a stronger dollar helps gain more revenues as most IT majors' over 40-50% revenue comes from the US. However, when the dollar weakens against other currencies such as GBP, EUR, or JPY, revenues earned in those regions helps boost the reported toplines in instance, India's largest software service provider, TCS, has the least dollar dependency among tier-1 companies and derives 50% of its revenues from non-USD currencies. It is expected to net a 211 basis points revenue upside in the second quarter of the ongoing fiscal. The maximum positive impact could be recorded by mid-sized firm KPIT at 299 basis points because it derives a substantial 72% of its revenues from non-USD markets, data by Kotak Institutional Equities showed."During the quarter, the Indian rupee has appreciated around 1% against the dollar which typically is not beneficial for exporters,' said Sumit Pokharna, IT analyst with Kotak Securities. 'However, the rupee has depreciated against other currencies in the 2.5-8% range. This is providing tailwinds for software services exporters on the US$ revenue growth from the previous quarter.'He added that tighter controls by companies on travel costs and hikes and some pulling back on compensation, will aid margins stability for large IT companies while expansion for select mid IT at a time when discretionary spending remains muted, and deal closure timelines are elongated, the exposure to other currencies is helping IT firms, Pokharna the flip side, companies like Persistent Systems and Mphasis, which have among the highest exposure to the US at 85% and 82%, respectively, the sequential benefit of the currency movement will be contained at 69 basis points and 75 basis points, respectively.
News18
15-05-2025
- Business
- News18
TCS Shares Falling Behind Peers, Tata Group Stocks: What's Dragging Down The IT Bellwether?
Last Updated: TCS underperformed in the past year, with its shares falling 10%, trailing key IT peers like Infosys, HCL Tech, and Wipro; Here's why Tata Consultancy Services Share Price: For years, Tata Consultancy Services (TCS) has stood as the flagship performer of the Tata Group—widely regarded as a symbol of stability, consistent earnings growth, and long-term value creation. However, the IT major has seen its shine dim over the past year. TCS shares have declined 10%, significantly underperforming not only key IT peers such as Infosys (up 12%), HCL Tech (up 24%), and Wipro (up 11%), but also most other Tata Group companies. In contrast, the Nifty IT index has risen over 15% during the same period. Within the Tata stable, TCS now finds itself trailing most group stocks, with only Tata Motors, Tata Elxsi, and Tata Technologies posting weaker performance. TCS's performance over the past year, though positive, has been overshadowed by the exceptional gains of other Tata Group companies. Factors such as global economic uncertainties and sector-specific challenges have impacted its growth trajectory. TCS's recent underperformance stems from a combination of external pressures and internal hurdles. Globally, the tech sector has been navigating uncertainty, with economic slowdowns in key markets like the US and Europe — TCS's primary revenue sources — curbing client spending. Inflation, elevated interest rates, and geopolitical tensions have further dampened discretionary and transformational IT investments. On the internal front, TCS has faced client-specific setbacks. The high-profile BSNL contract, once a major revenue driver, is now being scaled down, impacting the company's top line. Additionally, slower deal conversions and delays in decision-making across sectors such as retail, manufacturing, and healthcare have further weighed on revenue growth. From Leader to Laggard: Why Is TCS Falling Behind Its Peers? TCS has reported slower deal conversions and prolonged decision-making cycles across key sectors like retail, manufacturing, and healthcare, putting further pressure on revenue growth. Sumit Pokharna, VP–Fundamental Research (IT) at Kotak Securities, pointed out that TCS's management has acknowledged challenges in client spending, particularly in retail, manufacturing, and insurance. 'IT services spending growth is likely to fall below our base-case assumption of 4–5% in FY26, with delays in project executions," he noted. While TCS has struggled with growth headwinds, its peers have shown stronger momentum. HCL Tech's strategic focus on high-growth areas such as digital transformation and cloud services has delivered tangible results. Infosys continues to maintain robust deal wins, and Wipro's aggressive M&A strategy has helped broaden its client base and geographical reach. Sushovon Nayak, Research Analyst at Anand Rathi Institutional Equities, told News18: 'Deferrals in client spending—especially in the retail and manufacturing sectors—amid tariff uncertainties, as highlighted in TCS's Q4 FY25 commentary, along with client-specific challenges such as the BSNL ramp-down, have significantly weighed on the company's growth trajectory. These factors have collectively contributed to the stock's underperformance." He added: 'However, if the US-China trade deal progresses positively, we could witness a revival in discretionary IT spending, which may support improved growth prospects for TCS going forward." Light At The End Of The Tunnel For TCS? Following TCS's Q4 FY25 results, analysts at HSBC Securities and Capital Markets (India) noted that US tariffs and Jaguar Land Rover's (JLR) ageing portfolio are likely to weigh on growth in FY26. They warned that margins may disappoint as well. In the domestic automotive segment, Tata Motors — a key part of the Tata Group — faces continued competitive pressure in the passenger vehicle (PV) market, while the recovery in the commercial vehicle (CV) cycle remains sluggish. With limited near-term catalysts, HSBC downgraded Tata Motors to a 'Hold" rating (from 'Buy"), even as it raised the target price to Rs 770 from Rs 700. Jefferies India echoed similar concerns, noting that Tata Motors is headed for a challenging year. While Q4 EBITDA declined, it still came in 4% above Jefferies' estimates. The dip was attributed primarily to weaker JLR margins. 'JLR is expected to face headwinds in the coming year due to US tariffs, intensifying competition in China, and rising customer acquisition costs. India's CV demand has also slowed, while the electric PV segment is seeing increasing competition," Jefferies said. As a result, Jefferies has cut its FY26–27 EBITDA estimates for Tata Motors by 8%, though it raised earnings per share projections by 3–4%. The brokerage retained its 'Underperform' rating, with a revised target price of Rs 630. Disclaimer:Disclaimer: The views and investment tips by experts in this report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions. Stay updated with all the latest news on the Stock Market, including market trends, Sensex and Nifty updates, top gainers and losers, and expert analysis. Get real-time insights, financial reports, and investment strategies—only on News18. First Published:
