Moneycontrol PRO
Check Credit Score
Check Credit Score
HomeNewsBusinessMarkets

D-Street Buzz: Bank stocks face the heat of SC AGR order; SBI falls 5%

While telecom stocks such as Vodafone Idea and Bharti Airtel plunged up to 23 percent in intraday trade, major banks stocks such as SBI lost 5 percent, experiencing the heat due to their exposure to the telecom players.

October 24, 2019 / 02:27 PM IST
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Shares of most public and private sector banks came under strong pressure after the Supreme Court rejected the telecom companies' definition of Adjusted Gross Revenue (AGR).

With the judgment, the SC has exposed the incumbent telcos to potential demands by DOT of up to Rs 1.33 lakh crore.

While telecom stocks such as Vodafone Idea and Bharti Airtel plunged up to 23 percent in intraday trade, major banks stocks such as SBI lost 5 percent, experiencing the heat due to their exposure to the telecom players.

"The Supreme Court verdict on AGR is not good news for banks. Now, banks will find it difficult to lend to stressed sectors," said Rajkumar Bansal, MD and CEO at Edelweiss ARC.

In terms of exposure to the telecom sector, Axis Bank has an exposure of Rs 14,015 crore which is 2.82 percent of advances, the database of CNBC showed.

State Bank of India has an exposure of Rs 37,330 crore, which is 1.67 percent of their advances.

HDFC Bank has an exposure of Rs 24,514 crore (2.73 percent of advances) and Bank of Baroda has an exposure of 13,955 crore (2.67 percent of advances).

Kotak Mahindra Bank (2.19 percent of advances) and Punjab National Bank (1.73 percent of advances) have exposures of Rs 4,676 crore and Rs 7,318 crore, respectively.

Around 14:15 hours IST, Nifty PSU Bank index was down 3.75 percent and the Nifty Private Bank index was down 1.12 percent.

Shares of Indian Bank, State Bank of India, Bank of Baroda, Punjab National Bank, IndusInd Bank, Yes Bank were among the top losers.

Nifty was down 0.48 percent at 11,548 around that time.

The equity market was in the red as investor sentiment was roiled by trends of Maharashtra and Haryana assembly poll results. The ruling BJP was on course to win Maharashtra but Haryana was increasingly looking like a hung house.

Moneycontrol News
first published: Oct 24, 2019 02:27 pm

Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!

Advisory Alert: It has come to our attention that certain individuals are representing themselves as affiliates of Moneycontrol and soliciting funds on the false promise of assured returns on their investments. We wish to reiterate that Moneycontrol does not solicit funds from investors and neither does it promise any assured returns. In case you are approached by anyone making such claims, please write to us at grievanceofficer@nw18.com or call on 02268882347