On January 17, 2025, several prominent Indian companies—Infosys, Axis Bank, Reliance Industries, and Rail Vikas Nigam Limited (RVNL)—released their quarterly financial results, leading to notable movements in their stock prices.
Infosys
Infosys reported a consolidated net profit of ₹6,806 crore for the third quarter, marking an 11% year-on-year increase. Revenue from operations rose by 8% to ₹41,764 crore. Despite these positive figures, the company’s shares declined by approximately 6%. Analysts attributed this drop to concerns over the quality of earnings, noting that a significant portion of revenue growth was linked to “third-party items” in the deal pipeline, raising questions about sustainability.
Axis Bank
Axis Bank posted a consolidated net profit of ₹6,304 crore for the quarter, reflecting a 3.8% year-on-year growth. Net interest income increased by 9% to ₹13,606 crore. However, the bank’s shares fell by over 4% following the earnings release. This decline was primarily due to the bank missing profit estimates, attributed to slower loan growth and increased provisions for bad loans. Specifically, provisions and contingencies surged by 109.6% to ₹2,155.6 crore, and gross non-performing assets (NPA) rose to 1.46% from 1.44%.
Reliance Industries
Reliance Industries reported a 2.8% year-on-year decrease in net profit, amounting to ₹19,323 crore. Despite the decline in net profit, the company’s shares gained 2.2%. The positive market reaction was influenced by the company’s strong performance in its retail and telecom segments, which demonstrated robust demand and contributed to the overall financial health of the conglomerate.
Rail Vikas Nigam Limited (RVNL)
RVNL’s shares rallied by 7% after the company secured a significant contract worth ₹3,600 crore from Bharat Sanchar Nigam Limited (BSNL). This development was viewed positively by investors, as it is expected to enhance the company’s revenue streams and strengthen its position in the infrastructure sector.
In summary, while Infosys and Axis Bank reported profit growth, concerns over earnings quality and asset quality led to declines in their share prices. Conversely, Reliance Industries and RVNL experienced share price increases due to strong performance in key business segments and the acquisition of substantial contracts, respectively.
No comments: