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2-min read

Rate-Sensitive Bank, Auto & Realty Stocks Fall Up to 5% Post RBI Policy

In its fourth bi-monthly policy review, the central bank had reduced its benchmark lending rate by 0.25 per cent to revive growth.

PTI

Updated:October 4, 2019, 5:31 PM IST
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Rate-Sensitive Bank, Auto & Realty Stocks Fall Up to 5% Post RBI Policy
Representative image.

New Delhi: Rate-sensitive bank, auto and realty stocks fell by up to 5 per cent on Friday after the RBI slashed the country's economic growth outlook for this fiscal.

Among banks, Federal Bank fell 3.82 per cent, Kotak Mahindra Bank 3.46 per cent, ICICI Bank 3.17 per cent, RBL Bank 2.82 per cent, HDFC Bank 2.79 per cent, SBI 2 per cent, AXIS Bank 1.81 per cent and Yes Bank 0.94 per cent on the BSE.

Led by losses in these scrips, the bank index dipped 2.45 per cent to close at 31,303.39.

"Cut in GDP forecast by RBI coupled with selling in financials pulls indices down despite the rate cut," S Ranganathan, Head of Research, LKP Securities said.

In its fourth bi-monthly policy review, the central bank also reduced its benchmark lending rate by 0.25 per cent to revive growth. The Reserve Bank on Friday sharply cut its economic growth projection for this fiscal to 6.1 per cent from 6.9 per cent earlier.

From the realty pack, Prestige Estates Projects dropped 5.28 per cent, Indiabulls Real Estate 3.61 per cent, Sobha Limited 2.54 per cent, DLF 1.63 per cent, Oberoi Realty 0.89 per cent, Godrej Properties 0.66 and Sunteck Realty 0.28 per cent.

The realty index fell 1.15 per cent to 1,900.77 at close.

Auto companies also faced selling, with Exide Industries falling 3.14 per cent, Bosch 2.88 per cent, Tata Motors 2.37 per cent, TVS Motor Company 2.07 per cent, Eicher Motors 2.04 per cent, Motherson Sumi Systems 1.96 per cent, Maruti Suzuki India 1.53 per cent, Bajaj Auto 1.47 per cent, MRF 1.33 per cent and Apollo Tyres 0.09 per cent.

Tracking losses in these companies, the auto index declined by 1.10 per cent to 16,571.66.

"RBI has once again proved to be well ahead of the curve in unleashing monetary efficacies to combat the economic slowdown, in perfectly complementing the fiscal initiatives, with the cut of 25 bps - bringing down the repo rate to 5.15 per cent. We need to see more action from the government for a consumption-led recovery," K Joseph Thomas, Head Research - Emkay Wealth Management.

According to Motilal Oswal, managing director, Motilal Oswal Financial Services, "RBI cut policy repo rates by 25 bps to 5.15 per cent. This is a very good level of indicative rates. The issue is, transmission of these rates in the system. Equity markets are cautious and watchful about the earnings season which at this juncture looks less enthusiastic."

Benchmark BSE Sensex tumbled 433.56 points or 1.14 per cent to close at 37,673.31.

"RBI delivered 25 bps rate cut on Friday which however failed to live up to investor expectations and markets sell-off intensified post the announcement," according to Sanjeev Zarbade, VP PCG Research, Kotak Securities.

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Company Price Change %Gain
Yes Bank 51.40 8.44
Reliance 1,416.35 1.42
Indiabulls Hsg 231.20 16.80
Zee Entertain 250.20 -5.39
Maruti Suzuki 7,302.30 2.50
Company Price Change %Gain
HDFC AMC 2,882.20 6.11
Yes Bank 51.40 8.44
Indiabulls Hsg 231.50 17.42
Reliance 1,415.30 1.37
IRCTC 779.20 7.57
Top Gainers
Company Price Change %Gain
Yes Bank 51.40 8.44
Coal India 205.95 3.28
Adani Ports 421.70 3.07
Grasim 746.50 3.03
Maruti Suzuki 7,302.30 2.50
Company Price Change %Gain
Yes Bank 51.40 8.44
Coal India 205.95 3.31
Maruti Suzuki 7,318.15 2.74
Power Grid Corp 202.55 2.45
NTPC 121.00 2.02
Top Losers
Company Price Change %Gain
Zee Entertain 250.20 -5.39
Tata Motors 136.85 -1.90
Eicher Motors 20,275.90 -1.05
Bajaj Auto 3,087.05 -0.79
Hindalco 187.40 -0.74
Company Price Change %Gain
Tata Motors 136.70 -1.05
Bajaj Auto 3,087.75 -0.73
Bharti Airtel 383.25 -0.65
ICICI Bank 437.75 -0.64
Axis Bank 709.20 -0.19

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