Indian equities fell for the fourth day, led by software exporters, before the start of the earnings season this week.
The S&P BSE Sensex dropped 0.1 percent to 18,437.78 at the close in Mumbai. Volumes were 49 percent less than the 30-day average. Tata Consultancy Services Ltd. and Infosys Ltd., the nation’s biggest software exporters, dropped 1.2 percent each. Bharat Heavy Electricals Ltd., India’s biggest power-equipment maker, rose for the first time in four days after preliminary profit beat estimates. Infosys will kick-off the March quarter earnings season on April 12.
Foreigners sold a net $22.4 million of local shares on April 5, a fourth day of net outflows, according to data from the regulator. They are paring this year’s record purchases as corporate profit-growth slows amid the weakest economic growth in a decade. Net incomes at about 43 percent of the 30 Sensex firms trailed forecasts in the three months ended Dec. 31, compared with 40 percent in the previous two quarters.
“It will take at least two more quarters for earnings to trough out,” Chandresh Nigam, head of investments at Axis Asset Management Co., which has $2 billion in assets, said in an interview to Bloomberg TV India. “One has to look beyond the next one to two quarters to assess what kind of businesses make sense for us in the next 12-18 months.”
Tata Consultancy Services slid 1.2 percent to 1,480.75 rupees. Infosys shed 1.2 percent to 2,831.9 rupees. Wipro Ltd., the nation’s third-biggest software services provider, declined 1.3 percent to 448.8 rupees. The three stocks have a combined 16 percent weighting in the Sensex.
Bharat Heavy increased 2.6 percent to 182.5 rupees. The company today said its preliminary net income for year through March 2013 would be 64.9 billion rupees, beating the estimated 61.6 billion rupees. Reliance Industries Ltd., owner of the world’s largest refining complex, gained 1.2 percent to 789.4 rupees. Drugmaker Cipla Ltd. rose 2.1 percent to 395 rupees.
The Sensex has dropped 5.1 percent this year, the worst performing benchmark gauge in Asia, and is at its lowest level since Nov. 20. The measure trades at 12.5 times projected 12-month profits, the lowest level since July 26, data compiled by Bloomberg show. That compares with 10.2 times for the MSCI Emerging Markets Index.
The 50-stock CNX Nifty Index fell 0.2 percent to 5,542.95. Its April futures settled at 5,559. India VIX, which measures the cost of protection against losses in the Nifty, added 3.8 percent to 16.77.
TVS Motor Co. jumped 10 percent to 39.75 rupees after BMW Motorrad, the motorcycle arm of the world’s biggest luxury carmaker, agreed to partner with the local company to develop a series of bikes with engine sizes below 500 cubic centimeters. TVS is not a Sensex member.
Overseas investors have invested a net $10.2 billion in domestic shares this year, data compiled by Bloomberg show. Inflows in 2012 totaled $24.5 billion, the most among 10 Asian markets tracked by Bloomberg.