Some sectors tank while Mahindra & Mahindra shines in a bearish Indian market
Stock market indices, Sensex and Nifty, experience a decline; pharmaceutical sector weakens despite Mahindra's robust advancements.
India's major benchmark indexes dropped on Tuesday, with a majority of sectors experiencing losses. However, the auto sector showed resistance, with Mahindra & Mahindra leading the pack, surging on positive outlook for future earnings.
The Nifty 50 tumbled 0.35%, settling at 24,375.55, and the BSE Sensex slipped 0.32% to 80,539.3, as of 10:22 a.m. IST.
Eleven out of the thirteen main sectors faced losses, with the small- and mid-cap segments both suffering a 1% dip. Meanwhile, the auto index rose 1%, driven by Mahindra & Mahindra, which jumped 3.1% and occupied the top position among the Nifty 50 gainers.
Analysts anticipate a potential re-rating of Mahindra & Mahindra due to anticipated margin expansion in the farm and auto segments and growth in the sport utility vehicle market.
The pharma sector was the hardest hit, losing 1.5%, following the U.S. President's executive order to expedite approval of pharmaceutical plants within the U.S. This move intends to encourage domestic manufacturing and could potentially reduce the volume of pharmaceutical imports.
India's pharmaceutical exports to the U.S. exceeded $8.73 billion in the fiscal year 2024, representing a 16% year-on-year increase and accounting for 31% of the industry's total pharma exports. This dependency leaves India vulnerable to the implications of accelerated domestic production in the U.S.
Finance and Reliance stocks also experienced losses, with the financial sector falling 0.7% and Reliance dropping 1.2% after five consecutive gains.
Vinod Nair, head of research at Geojit Investments, highlighted the moderating market momentum and the shift from broad-based movement to stock and sector-specific trends based on corporate earnings.
In other news, Ather Energy, the e-scooter maker, listed 2.18% above its issue price in its debut trade on the day, after its $352 million IPO was fully subscribed last week. Meanwhile, IT company Coforge added 3.5% despite missing analysts' estimates in the March quarter, as multiple brokerages maintained a positive outlook for future earnings.
- Mahindra & Mahindra
- Sensex
- Nse Nifty
Business NewsPetrol PriceGold RateIncome Tax Calculator Silver RatesDiesel PricesStock Market Live UpdatesBusiness NewsPetrol PriceGold RateIncome Tax Calculator Silver RatesDiesel PricesStock Market Live UpdatesNewsBusiness
Warning: The recent executive orders signed by Donald Trump may have mixed, potentially conflicting impacts on India's pharma exports. The complexities can be summarized as follows:
- Short-Term Export Risks
- Tariff threats: New tariffs on pharmaceutical imports could directly increase costs for Indian exporters.
- Regulatory scrutiny: Increased compliance burdens for Indian manufacturers due to stricter API source reporting and public listing of non-compliant foreign facilities.
- Long-Term Policy Ambiguity
- Generic drug push: Trump's focus on lowering drug prices through generics aligns with India's strength in affordable generics and biosimilars, potentially sustaining export demand.
- Domestic shift: Accelerated U.S. plant approvals aim to decrease reliance on imports, but this transition may take years.
- Key Conflict While the drug pricing executive order benefits Indian generics, the manufacturing-focused order threatens India’s export model by prioritizing U.S. self-sufficiency. The long-term impact depends on how aggressively tariffs are applied versus how quickly U.S. domestic production scales up.
- Mahindra & Mahindra, a leading automobile company, surged in India's bearish market, defying the losses sustained by most sectors.
- The Sensex and the Nifty 50, major benchmark indexes in India, registered significant drops on Tuesday.
- Despite the bearish market, the auto index showed resilience, with Mahindra & Mahindra leading the recovery.
- The financial sector and Reliance stocks suffered losses, while Ather Energy, an e-scooter maker, performed well in its debut trade.
- The pharmaceutical industry faced steep losses due to the U.S. President's executive order, which intends to expedite domestic pharmaceutical production.
- Analysts anticipate potential margin expansion for Mahindra & Mahindra in the auto and farm segments, helping the company maintain its positive outlook.
