Multifold jump in Q1 sales and profit fail to lift these 5 BSE500 stocks

NEW DELHI: One out of 5 constituents from the BSE500 pack logged over 100 per cent surge in June quarter sales. But the sales rebound, albeit from a low base in 2020, could not lift the shares of at least 5 companies. These five stocks fell 10-17 per cent in the earnings season, though they reported up to 11 times surge in quarterly profits.

Shares of

(India) and fell 16-17 per cent since July 1 despite reporting a 2-3 times jump in year-on-year Q1 sales. , Dixon Technologies (India) and Bajaj Auto also declined despite logging in strong year-on-year numbers for the June quarter.

In the case of NBCC, net sales doubled to Rs 1,379.63 crore in the June quarter from Rs 676.95 crore in the year-ago quarter. Profit jumped 3.6 times to Rs 37.01 crore from Rs 10.23 crore YoY. The scrip is down 17 per cent since July 1.

Analysts said NBCC’s June quarter numbers were better-than-expected but the outlook on project awarding was weak. The management has also reduced FY22 project awarding guidance to Rs 6,500 crore from Rs 12,000 crore, they said.

NMDC’s sales soared 3.36 times in the June quarter to Rs 6,512.21 crore from Rs 1,937.50 crore YoY. Profit jumped 6 times to Rs 3,191.45 crore from Rs 531.78 crore YoY. The scrip is down 16 per cent since July 1.

Analysts are concerned that a fall in iron ore prices would hit the mineral producer. Prabhudas Lilladher said domestic iron ore prices would decline 10-15 per cent due to increased domestic availability and a reduction in exports. It has an accumulate rating on the stock.

Ircon International’s sales rose 2.16 times to Rs 1,140.11 crore from Rs 526.87 crore, while profit climbed to Rs 80.02 crore from Rs 34.91 crore YoY, up 2.29 times. Analysts were expecting better numbers but the execution of the Gurgaon-Rewari project order was delayed. IDBI Capital has a buy rating on the stock as it noted the company was targeting a revenue of Rs 6,500-7,000 crore in FY22 and was aiming for an Ebitda margin of 9-9.5 per cent for the year.

Dixon Technologies’ sales climbed 3.61 times to Rs 1,867.29 crore from Rs 516.94 crore YoY. Profit zoomed 11 times to Rs 18.16 crore from just Rs 1.6 crore in the year-ago quarter. This scrip is down 14 per cent since July 1. Among the 19 analysts tracking the stock, 9 have buy or strong buy recommendations, seven have hold and three have sell.

Bajaj Auto’s sales soared 2.44 times to Rs 7,216.57 crore, while its profit doubled to Rs 1,059.21 crore. The scrip fell 12 per cent for the earnings season. Analysts have largely given a buy call on the stock. They have said that without near-term cost pressures, the company would see margin tailwinds such as rupee depreciation, reinstatement of export incentives, premiumisation in two-wheelers and a rebound in high-margin three-wheeler demand.