Covid -19 has a huge impact on market this year. Many companies are dissolved, many are in debt. this document shows the impacts and measures taken by sectors and companies to overcome the outbreak.

1. COVID-19 – IMPACT ON
INDIAN STOCK MARKET
BY BHAGAVATH MANICKAVASAGAM

2. ABSTRACT
The research investigates the impact of the lockdown period caused by the
COVID-19 to the stock market of India. The study examines the extent of the
influence of the lockdown on the Indian stock market and whether the market
reaction is the same in pre- and post-lockdown period caused by COVID-19. A
brief study of selected companies from selected sectors is been done.

3. INTRODUCTION
 Pre COVID-19, market capitalisation on each major exchange in India was about $2.16 trillion.
The 2019 stock market rally was limited to 8-10 stocks within the large caps. At the beginning of
the year, there were close to 30 companies that were expected to file IPO’s. The market
conditions were generally favourable as they witnessed record highs in mid-January.
This Pandemic COVID-19 affected the economies of the world and India was also among those
nations. Due to the lockdown ordered by the government of India, everything came to halt in
this busiest country.

4. IMPACT OF COVID-
19 ON STOCK
MARKET
 The crashing of the global market
economy, major drop in oil prices, and
increasing unemployment are some of
the impacts of the pandemic COVID-19
that affected almost all countries in the
world.
 Following the strong correlation with the
trends and indices of the global market as
BSE Sensex and Nifty 50 fell by 38 per
cent.
 Companies have scaled back; layoffs have
multiplied and employee compensations
have been affected resulting in negligible
growth in the last couple of months.
Certain sector such as hospitality, tourism
and entertainment have been impacted
adversely and stocks of such companies
have plummeted by more than 40%.

5. Current scenario of Indian stock market
Compared to the previous domestic and global crisis, the Sensex has rebounded at the fastest
pace this time post the Covid crisis. From its 2020 high of 41,952.63 seen in January, the index is
just 6% away and has recovered from its low of 25,981.23 seen in March.
Companies with innovative products, increasing distribution reach, technology-driven
processes and healthy balance sheet would revive the growth momentum post lockdown. Lower
oil prices and high capital expenditure by the government in turn creating capital which will
provide a platform to flourish when we overcome COVID 19 pandemic.
It would be unwise to expect a quick economic rebound from the current COVID-19 effect. In
response to current turmoil, RBI and the Government of India has come up with a slew of
reforms such as reductions of repo rate, regulatory relaxation by extending moratorium and
several measures to boost liquidity in the system howsoever the pandemic has impacted the
premise of the corporate sector.

6. SECTORIAL IMPACT OF COVID-19
 Banking sector
India’s banking sector is sufficiently capitalised and well-regulated. The financial and economic
conditions in the country are far superior to any other country in the world. Credit, market and
liquidity risk studies suggest that Indian banks are generally resilient and have withstood the
global downturn well.

7. Company Overview:
AXIS BANK
Axis Bank is the third largest private sector bank in India. The Bank operates in four segments,
namely treasury, retail banking, corporate/ wholesale banking and other banking business. The
treasury operations include investments in sovereign and corporate debt, equity and mutual
funds, trading operations, derivative trading and foreign exchange operations on the account,
and for customers and central funding.
Retail banking includes lending to individuals/small businesses subject to the orientation,
product and granularity criterion.

8. IMPACT OF COVID-19
Axis Bank on Tuesday reported a loss of Rs 1,388
crore for the March quarter as the lender provided
an extra Rs 3,000 crore due to the disruption from
the pandemic.
The bank saw total slippages of ₹2,218 crore in Q1
FY21, compared to ₹3,920 crore in Q4 FY20
and ₹4,798 crore in Q1 FY20. Slippages from the
loan book were at ₹2,011 crore and that from
investment exposures stood at ₹207 crore. Credit
card limits of nearly 200,000 customers of Axis Bank
has been reduced with effect from April 15.
 Some of them have got hit in credit limit, as bad
as 90%
MEASURES TAKEN BY THE BANK
Complying to the RBI guidelines, total
provisions for Q4FY20 reserved to Rs 7,730
crore, up 122% sequentially.
 In Q4FY19, the private sector lender had
reported a profit of Rs 1,505 crore. Based
on RBI directions, company needed to make
provisions of Rs 560 crore but have put aside Rs
3,000 crore on account of Covid-19.
It has taken a conservative approach during the
quarter in three areas -- changes in accounting
policies; increase in provisions on standard
investments, red-flagged accounts

9. HDFC BANK
HDFC Bank Limited is a holding company. The bank offers a range of banking services covering
commercial and investment banking on the wholesale side and transactional/branch banking on
the retail side. It also offers financial services. The bank's segments include treasury, retail
banking, wholesale banking and other banking business.

10. IMPACT
The bank said its gross non-performing assets
(NPA) at 1.26 per cent was one of the lowest in
the banking industry. Continued slowdown in
economic activity has led to a decrease in
retail loan origination, sale of third party
products, use of credit and debit cards by
customers, efficiency in collection efforts and
waivers of certain fees.
As a result, fees/other income were lower by
approximately Rs 2,000 crore.
MEASURES
Provisions, as stated above, have increased. In
the quarter, the bank held floating provisions
of Rs 1,451 crore and contingent provisions of
Rs 4,002 crore as on June 30, 2020.
Total provisions. Provision is the money set
aside by banks under RBI norms to cover likely
losses in problematic loan accounts.
In this case, logically, HDFC Bank expects
significant pain going ahead from the COVID-
19 shock. It is pertinent to note the comment
that the bank has used its analytical models to
determine slippages during this quarter.

11. HEALTHCARE SECTOR
Healthcare has become one of India’s largest sector, both in terms of revenue and
employment. Healthcare comprises hospitals, medical devices, clinical trials, outsourcing,
telemedicine, medical tourism, health insurance and medical equipment.
 The Indian healthcare sector is growing at a brisk pace due to its strengthening coverage,
services and increasing expenditure by public as well private players. Indian medical tourism
market is growing at 18% y-o-y and is expected to reach US$ 9 billion by 2020.

12. Divi's Laboratories
Divi's Laboratories Limited is an Indian producer of active pharmaceutical ingredients (APIs)
and intermediates headquartered in Hyderabad, Telangana, India. The company manufactures
and custom synthesizes generic APIs, intermediates and nutraceutical ingredients. Divi's
Laboratories is India's second most valuable pharmaceutical company by market capitalization.
The company has six manufacturing facilities and three R&D centres across India.

13. IMPACT
Divi's Laboratories said that the company has
been able to have near-normal operations
during the quarter and there was minimal
impact due to COVID-19 pandemic.
 Divi’s Laboratories share price zoomed 16
per cent to hit a fresh 52-week of Rs 3228.05
apiece as the company reported 80.61 per
cent on-year rise in the consolidated net profit
at Rs 492.06 crore in the April-June quarter.
 The company had posted a profit of Rs
272.44 crore in the corresponding quarter of
the previous fiscal
MEASURES
Operations, measures put in place, support
to the nation. The company has quickly
“developed the process for
Hydroxychloroquine and Favipiravir
manufacturing from indigenous raw materials.
 These drugs are currently approved for
treating COVID-19 and we are completely
prepared to meet the demand

14. Cadila Healthcare
Cadila Healthcare is the 5th largest pharmaceutical company in India and is a flagship company
of the Ahmedabad based Zydus Cadila Group. It basically deals with pharmaceuticals,
diagnostics, herbal products, skin care products, and OTC products.
Cadila Healthcare Ltd. (CADILAHC) possess a market share of 3.85 percent with a turnover of
about USD 290 million. The pharmaceutical products of the company comprise of human
formulations, veterinary formulations, and bulk drugs.

15. IMPACT
Share price of Cadila Healthcare climbed
almost 5% on Friday after the Ahmedabad-
based company received a nod from the Drugs
Controller General of India (DCGI) for human
clinical trials of an indigenously
developed Covid 19 vaccine.
Cadila Healthcare share price opened with a
gain of 4.56% at Rs 379.80 and later touched
an intraday high of Rs 380, rising 4.61% against
the last close of Rs 363.25 on BSE.
The stock trades mere points away from its
52-week high of Rs 383.65. The stock has
gained 3.38% in one month and 43% since the
beginning of this year.
MEASURES
Cadila Healthcare Ltd., one of two Indian
drugmakers racing to develop an indigenous
Covid-19 vaccine, is in talks with potential
partners to ramp up production capacity if its
candidate passes human clinical trials.
The Ahmedabad-based firm is looking to hire
contract manufacturers for an additional 50
million to 70 million doses of its plasmid DNA
vaccine, on top of the 100 million that will
come from its own capacity, according to
Managing Director Sharvil Patel.
He declined to name the companies and the
amount Cadila has invested in developing the
vaccine.

16. Indian Tourism Sector
India is a large market for travel and tourism. It offers a diverse portfolio of niche tourism
products - cruises, adventure, medical, wellness, sports, MICE, eco-tourism, film, rural and
religious tourism. India has been recognized as a destination for spiritual tourism for domestic
and international tourists. In his Independence speech from Red Fort, Prime Minister Narendra
Modi urged people to visit 15 domestic tourist destinations in India by 2022 to promote tourism.
India ranked 34 in the Travel & Tourism Competitiveness Report 2019 published by the World
Economic Forum.

17. THOMAS COOK PVT.LTD
Thomas Cook Ltd. is an Indian travel agency, headquartered in Mumbai, India. It offers a range of
travel services including Foreign Exchange, International and Domestic Holidays, Visa, Passport,
Travel Insurance and MICE. Thomas Cook India is a subsidiary of Fairfax Financial Holdings
Limited, through its wholly owned subsidiary, Fairbridge Capital (Mauritius) Limited, and its
controlled affiliates which holds 67.61%.

18. Impact
The continued travel restrictions and negative
customer sentiments have severely impacted
leisure and corporate travel, and the foreign
exchange (forex) business.
This may lead to operating losses during fiscal
2021 and substantially reduce the net free cash
(over Rs 200 crore reported as on March 31,
2020).
Travel services firm Thomas Cook India reported
a consolidated net loss of Rs 108.62 crore for the
quarter ended June 30, 2020, on account of the
impact of COVID-19 pandemic.
Measures
TCIL is undertaking several cash preservation
measures including optimisation of payroll cost,
reduction in marketing and overhead costs,
renegotiation of lease rentals and supplier contracts.
These steps are expected to result in savings of
more than Rs 550 crore during the fiscal.
Recent withdrawal of the share buyback offer will
further reduce cash outflow by around Rs 180 crore
(including tax on share buyback).
Further, the company is looking to reengineer the
business, focusing on aspects such as contactless
customer experience, increased digitisation and
process efficiencies. But

19. Cox & Kings Ltd.
Cox & Kings Ltd., set up in 1758, is one of the longest established travel companies.
Headquartered in India and the UK, the holiday and education travel group has subsidiaries in
the United States, Canada, the United Kingdom, Netherlands, the United Arab Emirates, Japan,
Singapore, Australia and New Zealand. Cox & Kings Ltd. has operations spread across 22
countries and 4 continents

20. IMPACT
The crisis facing travel company Cox & Kings
will have a deep, negative impact on the travel
industry, especially on smaller players.
Cash-strapped Cox & Kings has defaulted on
debt obligations worth Rs 325 crore, four
times in three weeks.
Lenders have revoked part of the promoters’
shares in the company pledges against loans.
Its stock has taken a battering in the markets
and it has been downgraded by ratings
agencies
Measures
Travel and tour company Cox & Kings Thursday
said it has defaulted on the payment of
commercial papers due to cash flow mismatch
and a situation exacerbated by rating
downgrade.
Cox & Kings said it would meet its financial
obligations "through a combination of internal
accruals and monetisation of assets"
(As the company is undergoing insolvency
proceedings as it has huge debt and also due
to suspecting of frauds investigations have
been initiated.)

21. CONCLUSION
The nations, conglomerates, corporations and multinationals continue to understand the
magnitude of the pandemic, it is undoubtedly the need of the hour to prepare for a future that
is sustainable, structurally more viable for living and working.
The recovery in economy depends on the timings and magnitude of government support as
well as the level of corporate debt and how the companies and markets cope with lower
demand. Government assistance to those most in need (largely constituted of unorganised
sector, migrants and marginalised communities) is a critical measure to save many lives.
The COVID-19 pandemic has a clear message for the Indian economy to adopt sustainable
developmental models, which are based on self-reliance, inclusive frameworks and are
environment friendly.