businessfortnight

The S&P BSE Sensex and NSE Nifty 50 indexes opened lower in trade on Tuesday on the back of weakness in banking and financial services shares after the Reserve Bank of India warned that the banks may see bad loans double despite signs of an improvement in the economic impact of the COVID-19 pandemic. Meanwhile, weakness in other Asian markets also added to somber investor sentiment on Dalal Street. The Sensex fell as much as 187 points to hit an intraday low of 49,082.04 and Nifty declined as much as 52 points to hit low of 14,484.75. As of 9:23 am, the Sensex was down 105 points at 49,164.22 and Nifty declined 24 points to 14,460. Six of 11 sector gauges compiled by the National Stock Exchange were trading lower led by the Nifty Private Bank index’s 0.6 per cent decline after RBI’s warning on rising bad loans. The gross non-performing assets of banks may increase from 7.5 per cent in September 2020 to 14.8 per cent under a severe stress scenario. Even under a baseline scenario it

Goods and Services Tax (GST) e-invoice system has completed journey of three months and has facilitated smooth transition of the tax payers to the new platform, according to the Ministry of Electronics and Information Technology (IT) on Saturday. It has enabled over 37,000 tax payers to generate more than 1,680 lakh Invoice Reference Numbers (IRNs), during last three months from the NIC developed e-Invoice system. Starting with 495 lakhs during October 2020, generation of e-invoice has increased to 589 lakhs in November 2020 and 603 lakhs in December 2020. Interestingly, the e-way bill generation from the NIC (National Informatics Centre) developed e-way bill system is also highest during September to December 2020 compared to same months of previous years. The response of the system is good and generation of IRNs is hassle-free during this period. However, there have been common errors such as repeated requests on same document number, simultaneous requests on same document number and

Merchandise exports fell marginally by 0.8 per cent to $26.89 billion in December 2020, contracting for the third straight month, amid a registered decline in sectors such as petroleum, leather, and marine products. According to merchandise trade preliminary data released by the Ministry of Commerce and Industry on Saturday, January 2, the trade deficit reported last month, widened to $15.71 billion, as imports grew by 7.6 per cent to $42.6 billion. The country’s merchandise imports in December were $42.60 billion, as compared to $39.59 billion in the corresponding month last year, registering an increase of 7.6 per cent. According to the government, India was a net importer in December 2020, with a $15.71 billion trade deficit, as compared to the trade deficit of $12.49 billion in the same month last year, recording an increase of 25.78 per cent.

Shares in biscuit maker Mrs Bectors Food Specialities Ltd more than doubled in their market debut on Thursday, in a latest sign of strong investor appetite for the country’s food sector amid the COVID-19 pandemic. The initial public offering (IPO), which was nearly 200 times oversubscribed, comes days after Burger King India – a company to which Mrs Bectors sells buns – also enjoyed a strong stock market debut. Mrs Bectors raised about ₹ 540 crore in the IPO. The company makes cookies, creams and crackers under its flagship “Cremica” brand, besides bakery products such as breads, buns and cakes branded “English Oven”. Shares of the company opened at ₹ 500 per share on the National Stock Exchange, well above the initial public offering price of ₹ 288. At its session high, the company had a market value of ₹ 3,525 crore.

Indian firms invested a sum of $12.25 billion under both the automatic and the approval routes in the first eight months of this year, which has been in accordance with the steady outflows witnessed in the last couple of years. In the financial year 2020-21, around $13 billion was invested by the Indian companies, which was the second successive year of double-digit overseas investment since the financial year 2013-14, according to a recent research report released by CARE Ratings. In the current financial year, Singapore, USA, British Virgin Islands, Netherlands, and Mauritius were the most preferred investment destinations of the Indian companies. These five countries accounted for almost 70 per cent of the total investment. According to the report, JSW Steel, ONGC Videsh, HCL Technologies, Haldia Petrochemicals, and Mahindra & Mahindra were the top five investors with an individual investment of more than $500 million. Furthermore, Adani Properties, Piramal Enterprises, Lupin, C

Indian economy’s worst contraction on record amid coronavirus pandemic did not deter the foreign institutional investors from buying equities in the country’s markets albeit they poured record amount in a pandemic-hit year. So far this year, the foreign institutional investors have bought shares worth over ₹ 1.50 lakh crore ($20.59 billion) data from National Securities Depository Limited (NSDL) showed. This was the highest-ever money invested in Indian stock markets by FIIs ever in a calendar year and highest since 2010 when they invested ₹ 1.33 lakh crore in equity markets. Buying by FIIs have propelled the Indian equity benchmarks – Sensex and Nifty to new all-time highs. Cheap stock valuations in the aftermath of Covid-related lockdown and gush of liquidity infused by central banks helped foreign investors pour money into Indian stocks, analysts said. “Cheap valuations and easy liquidity because of central banks opening their purses across the globe helped India get highest foreign

Shares of Burger King were locked in a 20 per cent upper circuit at ₹ 162 a day after it made a stellar market debut on Monday. There were a total pending buy orders for 15,88,446 shares on the BSE while there were no sellers on the exchange. The shares of the quick-service restaurant chain got listed at ₹ 115.35 on the BSE, a 92.25 per cent premium over the issue price of ₹ 60. On the NSE, the shares debuted at ₹ 112.50, up 87.5 per cent. Burger King India’s initial public offer, which was open between December 2 and 4, consisted of a fresh issue of equity shares amounting to ₹ 450 crore and an offer for sale worth ₹ 360 crore by the promoter QSR Asia, in the price band of ₹ 59-60 per share.

Mumbai-based information technology company Majesco on Tuesday approved an interim dividend of ₹ 974 per equity share of face value of ₹ 5 each for the financial year 2020-21. The interim dividend approved by Majesco board is at the rate of 19,480 per cent of the face value of the company, Majesco said in a stock exchange filing. Majesco’s dividend payment translates to an amount of ₹ 2,788.4 crore on a shareholder base of 28.57 million shares, the company said in an exchange filing. The balance cash reserves estimated at ₹ 103 crore will be distributed subject to board and regulatory approvals, Majesco added. Majesco will go ex-dividend on December 23 and record date for dividend has been fixed at December 25. Earliest Dividend Payout will be done on December 30, Majesco said in an investor presentation. Majesco in July this year approved sale of its entire stake in US subsidiary to private equity firm Thoma Bravo. Majesco provides insurance software solutions. As of 1:19 pm, Majesco

Cryptocurrency Bitcoin jumped by more than $850 – or 5 per cent – to touch the $18,238.20 mark on Sunday, inching towards an all-time high of $19,666 registered this week. Recent gains in the virtual currency are part of a broader bull run that began last month after US-based online payments company PayPal allowed its customers to use Bitcoin on its network. It was last seen trading higher by over $800 to $18,173.70 on November 29, 2020.  Most other cryptocurrencies followed suit. Among major peers, Ethereum (ETH) traded 5.11 per cent higher at $556.16, XRP was up 6.83 per cent at $0.62688 and Cardano (ADA) up 0.24 per cent at $0.169106. Bitcoin has surged exponentially since entering a four-digit value for the first time in 2013. It has rallied more than 130 so far this year, fueled by demand for riskier assets. The cryptocurrency’s perceived quality as a hedge against inflation and expectations of mainstream acceptance lured institutional and retail demand.

Securities and Exchange Board of India (SEBI) has proposed a reduction in the equity dilution requirement for initial public offers (IPOs) exceeding ₹ 10,000 crore. Companies with a post-issue capital above ₹ 10,000 crore will be required to initially sell only 5 per cent to the public, as against 10 per cent mandated earlier, the market regulator said in a consultation paper issued on Friday. The consultation paper will be open for public feedback till December 7. “It has been represented that such large issuers already have investments by PE / other strategic investors who are classified as public shareholders postlisting and therefore, mandating minimum 10 per cent of post issue MCap at the time of IPO leads to unnecessary dilution of holding of the promoter/ existing shareholder and is therefore a constraining factor for listing”, Sebi said in its consultation paper. SEBI has also proposed to increase the timeline for maintaining minimum public shareholding at 95 per cent from 3 ye

The S&P BSE Sensex and NSE Nifty 50 indexes resumed their up move after a day’s pause in the previous session led by gains in information technology, banking and telecom shares. The benchmarks opened higher but turned negative as banking shares witnessed selling pressure. However, late buying in banking and financial services shares led to recovery in the last hour of trading. The Sensex rose over 400 points at the day’s highest level and Nifty 50 index touched an intraday high of 12,892.45 before hitting an intraday low of 12,730.25. The Sensex ended 282 points higher at 43,882 and Nifty 50 index rose 87 points to close at 12,859. All the 19 sector gauges, barring the index of energy shares, ended higher led by the S&P BSE Telecom index’s nearly 5 per cent gain. FMCG, consumer durables, power, banking, auto and IT indexes also rose between 1-2.8 per cent each. Mid- and small-cap shares also witnessed buying interest as the S&P BSE MidCap index climbed 1.22 per cent and S&a

Investors and financial executives took a big sigh of relief on Saturday after major networks declared Democrat Joe Biden winner of the U.S presidential election, offering some certainty after days of conflicting reports about who might run the White House next term. Although current President Donald Trump said he would fight the results in court, Wall Streeters who offered comments felt there was little doubt Biden would ultimately succeed. Election predictors including the Associated Press, NBC, Fox News and Edison Research, upon which Reuters relies, called the presidency for Biden.”Biden is good news for the markets,” Christopher Stanton, chief investment officer at Sunrise Capital Partners, said on Saturday. “We’re all so tired of the whipsaw that came with the Trump tweets.”Major U.S stock indexes registered their biggest weekly gains since April this week, as investors bet Biden would win and Republicans would hold onto the Senate. That scenario would create a steadier hand in t

World stocks fell further and oil headed for a double-digit weekly slide on Friday as jitters over a rising global COVID-19 infection rate and next week’s US presidential election more than offset strong euro zone quarterly growth data. A strong central bank-fuelled bounce back from the initial pandemic slide earlier in the year has faltered this week, with concerns about an even worse second wave of infections, particularly in Europe, taking the froth off markets. “The US election, the extent of further lockdown measures, Brexit negotiations and vaccine news all present both upside and downside risks over the coming weeks and it is understandable that investors may want to proceed with caution,” said Mark Dowding, chief investment officer at BlueBay Asset Management. World stocks were down 0.3 per cent at 0925 GMT (2:55 pm in India), tracking weakness in Asia, while US stock futures were down 1 per cent to 1.3 per cent. Gold rose, with spot prices climbing 0.3 per cent to $1,873 an ou

The Reserve Bank on Tuesday asked all lending banks and non-banking financial companies, to ensure that the scheme of waiver of interest on interest for loans up to ₹ 2 crore for the six-month moratorium period is implemented by November 5, as decided by the government. Last Friday, the government had announced the scheme for grant of ex-gratia payment of difference between compound interest and simple interest for six months to borrowers in specified loan accounts. The lending institutions have been asked to complete the exercise of crediting the amount in the accounts of borrowers by November 5. Housing loans, education loans, credit card dues, auto loans, MSME loans, consumer durable loans and consumption loans are covered under the scheme. The scheme mandates ex-gratia payment to certain categories of borrowers by way of crediting the difference between simple interest and compound interest for the period between March 1, 2020 to August 31, 2020 by respective lending institutions.

New guidelines set by insurance regulator Insurance Regulatory and Development Authority of India (IRDAI) for medical insurance providers are set to come into force from October 1. The changes are aimed at making health insurance plans broader – covering more treatments – and more simplified. The new rules come at a time when the continuous spread of coronavirus pandemic has led to the worst contraction in the country’s GDP or gross domestic product on record. What are these changes in health insurance, and how do they impact you? Decision On A Claim Within 30 Days According to the new guidelines, released by IRDAI in June, insurance companies will be required to either settle or reject a claim not more than 30 days from the date of its receipt, under certain conditions. Any Delay Means Interest In case an insurer fails to decide on a claim within this period, it will be required to pay interest at a rate of 2 per cent above the applicable bank rate on the dues to the policyholder. Thi

India and Norway carried out a comprehensive review of their fast expanding relationship and resolved to further boost trade and investment ties. The two sides deliberated on a range of key issues today at a virtual meeting of the India-Norway Joint Commission which was co-chaired by External Affairs Minister S Jaishankar and his Norwegian counterpart Ine Eriksen Soreide. In a statement, the Ministry of External Affairs said the two sides also hoped for an an early conclusion of the India and EFTA (European Free Trade Association) trade negotiations. The four members of EFTA are Switzerland, Iceland, Norway and Liechtenstein. “Both sides reaffirmed their commitment to expand the bilateral trade in order to realise the untapped potential in the commercial and economic relationship. The two ministers expressed their hope for an early conclusion of the India and EFTA trade negotiations,” the MEA said. It said Mr Jaishankar and Ine Eriksen Soreide reviewed the entire gamut of bilateral rel

Billionaire Mukesh Ambani-promoted Reliance Industries said on Tuesday that its retail arm, Reliance Retail Ventures, will sell a 1.2 per cent stake to Abu Dhabi Investment Authority (ADIA) for ₹ 5,512.50 crore. The deal gives Reliance Retail Ventures a pre-money equity value of ₹ 4.29 lakh crore, the conglomerate said in a press release. The transaction, latest in a series of investments in Reliance Retail from global investors, is likely to bolster Reliance Industries’ retail presence in the domestic market. With this investment, Reliance Industries said its retail unit has raised a total of ₹ 37,710 crore from leading global investors, including Silver Lake and KKR, within four weeks. That is a second investment by ADIA in a Reliance Industries group company. In June, the Abu Dhabi-based state-owned company had agreed to take a 1.16 per cent stake in Reliance Industries’ digital services arm, Jio Platforms, for ₹ 5,683.50 crore. “We are delighted with ADIA’s current investment and c

The S&P BSE Sensex and NSE Nifty 50 indexes rose for third session in a row led by rally in Tata Consultancy Services which rose after it informed exchanges that its board will consider share buyback proposal on October 7, the day it will declare its second quarter earnings. The Sensex rallied as much as 567 points to briefly move above 39,000-mark and Nifty 50 index reclaimed its important psychological level of 11,500. TCS was top mover in the Sensex and it alone contributed 184 points towards the Sensex. The Sensex ended 277 points or 0.71 per cent to close at 38,974 and Nifty 50 index climbed 0.76 per cent or 86 points to close at 11,503. Eight of 11 sector gauges compiled by the National Stock Exchange ended higher led by the Nifty Information Technology index’s 3.5 per cent gain. Metal, pharma and private banking shares also witnessed buying interest. On the other hand, energy, media, state-run lenders and select auto stocks faced selling pressure. Mid- and small-cap shares e

Eight of the 10 most valued companies added Rs 1,45,194.57 crore in their total market valuation last week with Tata Consultancy Services and HDFC Bank emerging as leading gainers. During the holiday-truncated week, the Sensex advanced 1,308.39 points or 3.49 per cent. The market valuation of Tata Consultancy Services (TCS) zoomed Rs 37,692.7 crore to Rs 9,46,632.85 crore, emerging as the biggest gainer among the top 10 firms. HDFC Bank’s valuation jumped Rs 34,425.67 crore to Rs 6,09,039.90 crore. The market capitalisation of HDFC gained Rs 25,091.57 crore to Rs 3,21,430.66 crore. Reliance Industries Limited (RIL) added Rs 15,789.36 crore to Rs 15,04,587.18 crore and the valuation of ICICI Bank rose by Rs 14,244.15 crore to reach Rs 2,54,574.08 crore. The valuation of Kotak Mahindra Bank went up by Rs 11,053.88 crore to Rs 2,58,346 crore and that of Hindustan Unilever Limited (HUL) by Rs 4,064.73 crore to reach Rs 4,92,243.78 crore. Infosys added Rs 2,832.51 crore to Rs 4,33,480.32 cr

Billionaire Mukesh Ambani’s Reliance Industries Ltd on Friday announced to raise Rs 7,350 crore from two investors — Singapore’s sovereign wealth fund GIC and Global alternative asset firm TPG — by selling a stake in group’s retail arm. Through two separate deals, Reliance Industries will sell 1.63 per cent stake in Reliance Retail Ventures Limited (RRVL). GIC will invest Rs 5,512.5 crore to buy 1.22 per cent share in RRVL, the Indian firm said in a statement. It said TPG will invest Rs 1,837.5 crore to buy 0.41 per cent stake in RRVL. The investments value Reliance Retail at a pre-money equity value of Rs 4.285 lakh crore. In less than three days, Reliance Industries has entered into five deals to sell stake in RRVL. Earlier, On Thursday, RIL had announced Abu Dhabi-based sovereign wealth fund Mubadala Investment Co will invest Rs 6,247.5 crore to buy a 1.4 per cent stake in its retail arm. On Wednesday, global private equity firm General Atlantic picked up a 0.84 per cent stake in th