Sensex’s losing streak ends; SBI gains despite steep quarterly loss
Photo Credit: Reuters

Indian shares ended slightly higher on Tuesday, driven by gains in Dr. Reddy's Laboratories Ltd and State Bank of India (SBI) following their quarterly results.

The broader NSE Nifty closed 0.19 percent higher at 10,536.70, while the benchmark BSE Sensex edged up 0.1 percent to 34,651.24. Both the indexes snapped five straight sessions of decline.

SBI closed 3.9 percent higher and was the biggest boost on both the indexes. The Nifty PSU bank Index ended 3.3 percent higher.

Dr. Reddy's rose 6.2 percent and was the top percentage gainer on both the indexes.

State Bank of India (SBI) reported its deepest-ever quarterly loss on Tuesday, far beyond analyst estimates, due to higher provisions for bad loans, but said it expects a key bad loan metric to fall sharply in two years.

Investors responded to the forecast by pushing up the shares of India's biggest lender by as much as 6.2 percent, outpacing a 3 percent gain in the Nifty PSU Bank index.

SBI said net loss for the three months ended March 31 was 77.18 billion rupees ($1.13 billion), versus an average 12.85 billion rupee loss from 16 analyst estimates complied by Thomson Reuters. The result also compared with a restated net loss of 34.42 billion rupees in the same period a year earlier.

Management had indicated that the quarter's results would be "very bad", so this was largely expected, said AK Prabhakar, head of research at IDBI Capital. "The worst is over for SBI."

SBI earlier indicated about 500 billion rupees in new bad loans but the actual figure was much less - 336.70 billion rupees, up 30.3 percent on quarter - which has been completely provided for, Prabhakar said.

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