Five of the six BSE 500 stocks, where retail investors raised their holdings by at least 50 basis points in the last four quarters, are down up to 60 per cent year-on-year, data compiled from corporate database AceEquity showed. These included IT names such as Zensar Technologies and Birlasoft, graphite electrode maker HEG, power trading platform IEX and sugar producer Balrampur Chini Mills.
Shares of Zensar Technologies have declined 59.68 per cent year-to-date. Small individual investors holding shares of up to Rs 2 lakh in the company as of September 30 held 19.76 per cent. This was 431 basis points higher than the June quarter’s share of 15.45 per cent. Retail investors held 13.75 per cent in the company as of the March quarter, 10.89 per cent in December and 9.18 per cent in the year-ago quarter.
Analysts said the company faces short-term demand challenges due to macro headwinds in the high-tech and manufacturing and consumer services segments. Even though the management has retained the guidance of achieving mid-teens margins by Q2FY24E, they recently cut earnings estimates for FY23-25.
HEG shares have declined 43 per cent so far in 2022. Retail share in the company has risen consistently over the last four quarters – by at least 90 basis points, to 21.41 per cent in the September quarter from 14.04 per cent in the year-ago quarter.
ICICIdirect has upgraded the stock to ‘Buy’ from ‘Hold’, it said as countries around the world are moving towards their carbon neutrality goals and corporates are adopting eco-friendly manufacturing processes.
“Steelmakers are gradually shifting towards EAF process, auguring well for demand for graphite electrodes in the medium to long term. This is likely to support an upside move in graphite electrode prices,” it said .
Birlasoft is down 50 per cent year-on-year. Retail holding in the IT firm reached an all-time high of 19.44 per cent in the September quarter, as against 12.09 per cent in the year-ago quarter. Birlasoft’s September quarter results were mixed. Quarterly performance was weaker than expectations due to delays in deal ramp-up, furloughs at some customers, and a postponement of work expansion expected after the completion of a major project.
Emkay in a recent note said the company is grappling with weakness in life sciences and E&U and is seeing a trend of longer deal closure and execution cycles. But the company has not seen any project getting cancelled.
“Considering possible furloughs in Q3 and ongoing macro uncertainties, improving supply-side conditions, strength in BFSI and manufacturing, and healthy deal wins, management is confident of delivering double-digit revenue growth in FY23 . We cut our EPS estimates by 1.9. -3.3 per cent for FY23E-25E, factoring in Q2 performance. Revenue growth acceleration is key to stock price performance in our view,” it said.
IEX is down 45 percent year-to-date. Retail holding in the stock stood at 39.61 per cent in the September quarter, as against 19.21 per cent a year ago. Analysts cited the recent loss in market share and said there are risks to near-term volumes. He added that broader time series data would have to wait before writing off IEX’s monopoly position.
Balrampur Chini Mills has declined by 5 per cent this year. Retail holding in the company stood at 18.10 per cent in the September quarter, as against 14.56 per cent in the year-ago quarter.
Centrum Broking in a note today said: “Raw sugar prices recently touched a more than seven-month high and are currently marginally down from five-year highs. Notably, during the year Considering the 8-9 per cent fall in rupee. (28 per cent since 2017 high) the current rates are way above that high. In short, the current rates are very remunerative to Indian sugar mills and they can easily Should be able to export 6MMT quota before May 2023. As per Balrampur management more than 4 MMT has already been contracted.”
The brokerage has given buy rating on the stock with a target of Rs 486.
Meanwhile, Amara Raja made a strong recovery from its June low of Rs 438.15. The stock is flat year-over-year. For the September quarter, the company reported one of its best quarterly performances in recent times, said analysts.
