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9 January 2024 : Important Financial News in India

FINANCE MARKET HEADLINES TODAY
FINANCE MARKET HEADLINES TODAY

Source: Economic Times, “Today’s ePaper”
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Table of Contents

Sony-Zee Impending $10b Marriage on the Rocks

Sony Group Corp is reportedly on the verge of abandoning a proposed $10-billion merger with Zee Entertainment Enterprises Ltd (ZEEL). This merger, first announced two years ago, was aimed at creating India’s largest broadcast company. The collapse of this deal highlights the complexities and challenges in the media industry, particularly in large-scale mergers. Sony’s withdrawal from the agreement could have significant implications for both companies and the broader media landscape in India.

ABC of India Inc to Set Sail for Ayodhya’s D-Day

India’s largest conglomerates are buzzing with activity as their top executives prepare for a unique pilgrimage to Ayodhya. Travel desks are working tirelessly to organize this once-in-a-lifetime journey. This event signifies not only a religious undertaking but also a moment of cultural and corporate significance, showcasing the blend of tradition and modern business practices in India.

Apple’s India Crop: ₹1Lcr iPhones

Apple has significantly increased its production output in India, with iPhones worth over ₹1 lakh crore manufactured last year. This marks a sharp increase from the previous year’s production numbers. The company’s growing investment in India reflects its confidence in the Indian market and its strategy to diversify its manufacturing base amid global economic changes.

Customs Case: Singhania-led Firm Pays ₹328-cr Penalty

The Gautam Singhania-led Raymond Group recently settled a customs duty evasion case by paying a substantial penalty of ₹328 crore. The Directorate of Revenue Intelligence (DRI) had accused the company of evading duties on the import of 142 cars. This settlement highlights issues of regulatory compliance and legal challenges faced by large corporations in India.

NFRA Plans Annual Auditor Checks

The National Financial Reporting Authority (NFRA) is planning to conduct annual inspections of major audit firms, including the Big Four. This initiative aims to establish an oversight mechanism to ensure compliance and enhance the integrity of financial reporting. This move could significantly impact the auditing practices in India, marking a first in such regulatory oversight.

These headlines reflect significant developments in India’s corporate world, ranging from large-scale mergers and manufacturing expansions to compliance and regulatory measures. Each story highlights key trends and challenges in the rapidly evolving business landscape of India.

Vehicle Registrations Zoom 21% in December

Vehicle registrations in India saw a significant 21% increase last month. This surge is attributed to consumers rushing to close purchases across various categories, motivated by year-end discounts and the anticipation of price hikes in the new year. This trend indicates a robust consumer market and reflects the automotive industry’s recovery and growth prospects.

Tiger Woods Ends Decades-Long Ties with Nike

In a notable shift in the sports endorsement landscape, Tiger Woods announced the end of his long-standing relationship with Nike. Woods, a 15-time major champion, has been associated with Nike since turning professional at 20. This decision marks the end of an era in sports sponsorships and could signal new marketing strategies for both Woods and Nike.

Revenue Growth on Cards for Jio, Airtel; User Loss to Weigh on Vi

Reliance Jio and Bharti Airtel are expected to report sequential revenue growth in their mobile businesses in India, driven by strong broadband user growth and increased data consumption, especially during the recent Cricket World Cup. Conversely, Vi (Vodafone Idea) is grappling with user losses, which might impact its financial performance.

Mercedes Gearing up to Drive in a Dozen New Models

Mercedes-Benz, the renowned German luxury carmaker, plans to launch over a dozen new models in the Indian market this year. This lineup includes three battery electric vehicles and several facelifts, underscoring Mercedes’ commitment to expanding its presence in India’s burgeoning luxury car segment.

JLR Wholesales Rise 27% in Dec Quarter

Jaguar Land Rover (JLR), owned by Tata Motors, reported a 27% increase in wholesales in the December quarter of 2023, reaching 1,01,043 units. This marks JLR’s highest wholesales in 11 quarters, highlighting a significant recovery and growth in the luxury automotive sector.

‘QSR, Soft Drink Businesses to Bounce Back This Year’

The quick service restaurant (QSR) and soft drink sectors are poised for a rebound this year. Despite a challenging last year, with the key April-June quarter being affected by rains, industry experts anticipate a resurgence in sales, driven by changing consumer habits and economic recovery.

Campa Joins BCCI as Central Sponsor

Campa, a soft drink brand owned by Reliance Consumer Products, has secured a sponsorship deal with the Board of Control for Cricket in India (BCCI). As an official central sponsor, Campa will be prominently featured in all BCCI series played in India, starting this year. This partnership reflects the growing intersection of consumer brands and sports marketing.

D-St Plays Safe Ahead of Results, Macro Data

Investors on Dalal Street (D-St) displayed caution, leading to a nearly 1% drop in India’s stock benchmarks. This cautious approach comes ahead of the third-quarter corporate results season, indicating a period of uncertainty and strategic reassessment among investors in anticipation of the upcoming financial disclosures.

Oil Falls 4% as Saudi Price Cuts Add to Demand Doubts

Oil prices witnessed a 4% decline due to significant price cuts by Saudi Arabia and a rise in OPEC output. This decrease counters concerns about supply disruptions caused by growing geopolitical tensions in the Middle East, reflecting the complex dynamics influencing global oil markets.

Rupee Almost Flat Against Dollar

The Indian rupee showed minimal change against the US dollar, closing just 1 paisa higher at 83.14. This stability was supported by a drop in international crude oil prices but offset by the strength of the American currency and negative trends in domestic equities, as noted by forex dealers.

Retail Investors’ Faith in Equities Takes MFs’ AUM Past ₹50 L crore

Mutual Funds (MFs) in India saw their Assets Under Management (AUM) surpass ₹50 lakh crore, driven by a surge in staggered equity investments through monthly plans. This growth reflects retail investors’ confidence in equities, even as the main index crossed the 21,000 mark in December.

Loan Growth, Fees to Lift Bank Profits in Q3, Higher Deposit Costs to Pinch

Indian banks are expected to experience a boost in profits for the third quarter, thanks to increased loan growth and fees. However, this positive trend might be somewhat mitigated by higher deposit costs, which could impact net interest margins (NIMs).

Phoenix Mills, Suzlon, Thermax, Among Stocks Likely to Enter FTSE All-World Index

Indian stocks such as Phoenix Mills, Suzlon, and Thermax are poised to join the FTSE All-World Index, according to predictions by IIFL Alternative Research. This inclusion in the semi-annual review in March would mark a significant milestone for these companies on the global investment stage.

Group Health Policies Lead the Way as Medical Inflation, Retail Premiums Bite

With rising medical inflation and health insurance premiums, employer group insurance has become the fastest-growing segment in health insurance. This trend is highlighted in the draft red herring prospectus of Medi Assist, India’s largest insurance third-party administrator (TPA), as it prepares for its IPO.

Bloomberg to Seek Feedback On Including Govt Bonds in Its EM Index

Bloomberg Index Services is set to begin consultations for feedback on potentially including Indian government bonds in the Bloomberg Emerging Market Local Currency Index. This significant move could lead to substantial inflows, estimated between $2-$4 billion, into India’s domestic bond market. The decision hinges on how investors react to this proposal. If favorable, it could mark a notable shift in the investment landscape, enhancing the visibility and attractiveness of Indian government bonds to a broader range of international investors.

Shapoorji Pallonji Firm Faces Bond Yield Spike on Asset Sale Concerns

Goswami Infratech, part of the Shapoorji Pallonji group, is grappling with a sharp increase in bond yields, which have surged by up to 200 basis points to 19%. This spike stems from concerns about a potential violation of a covenant related to the sale of assets. The situation, as reported by three individuals familiar with the matter, highlights the financial strain and market sensitivity surrounding the company’s asset sales and their broader implications.

Sula Vineyards Soars 20% on CLSA Upgrade

Sula Vineyards, a prominent player in the wine industry, witnessed its shares skyrocket by 20% to ₹665.25, hitting the day’s highest tradable limit. This surge came on the heels of an upgrade in both rating and price target by CLSA. The upgrade followed the Maharashtra government’s extension of its subsidy scheme for the sector, signaling a positive outlook for the company and possibly the industry at large.

NCLAT Rejects Authum Plea Against Takeover of Srei Twins

The National Company Law Appellate Tribunal (NCLAT) has dismissed an appeal by Authum Investment & Infrastructure against the takeover of the twin Srei non-banking financial companies by the National Asset Reconstruction Company (NARCL). This decision paves the way for a smoother acquisition process, removing significant legal hurdles and possibly indicating a more streamlined approach to such financial takeovers in the future.

Radhakrishnan May Be Joining Sundaram MF as Its New Head

Anand Radhakrishnan, the outgoing chief investment officer of equity at Franklin Templeton Mutual Fund, is reportedly set to join Sundaram Mutual Fund. This potential move, as indicated by three sources familiar with the matter, represents a significant career transition for Radhakrishnan and could signal a strategic shift or new direction for Sundaram Mutual Fund.

Fino Payments Applies to RBI for a Small Finance Bank Licence

Fino Payments Bank has officially applied for a small finance bank (SFB) licence with the Reserve Bank of India (RBI). This move represents a strategic step in the bank’s progression, as it has been preparing for an expansion of its banking activities. The transition to a small finance bank could open new opportunities and broaden the scope of services offered by Fino Payments Bank.

Travel Companies Say Maldives’ Tourism Remains Steady Despite Diplomatic Row

Despite the ongoing diplomatic tensions between India and the Maldives, travel industry executives report no significant decline in flight and hotel bookings to the island nation. This observation comes after several Indian social media users claimed they had canceled their travel plans. This resilience in tourism indicates the strong appeal of the Maldives as a travel destination, despite geopolitical issues.

Adani’s ₹4,100-crore Bid Set to Lead Lanco Unit Auction

Adani Power has made a substantial ₹4,100 crore unsolicited offer to acquire Lanco Amarkantak Power. This bid is expected to be the baseline or ‘anchor’ for the forthcoming auction aimed at selling the distressed thermal power company. This move by Adani Power highlights the company’s strategic expansion plans and its role in shaping the power sector’s future.

Adani Group Pledges ₹42,700-Crore Investment in Tamil Nadu

The Adani Group has announced a massive investment of ₹42,700 crore in various sectors in Tamil Nadu. This commitment was made at the Global Investors Meet 2024, signifying the group’s substantial role in the region’s economic development. This investment could have far-reaching implications for job creation and growth in multiple industries within the state.

ACC Acquires Remaining Stake in Asian Concretes

ACC Ltd has completed its acquisition of the remaining 55% stake in Asian Concretes and Cements for Rs 775 crore. This acquisition will increase ACC’s production capacity by 2.8 million tonnes, totaling 38.55 million tonnes. The move indicates ACC’s intent to strengthen its position in the cement industry.

Adani Green Energy Plans Early Redemption of $750 Million Bonds

Adani Green Energy has announced its intention to redeem its USD 750 million bonds eight months before their maturity date. This decision is aimed at bolstering investor confidence in the renewable energy company’s financial stability and growth prospects.

New Aviation Rules Grant Pilots Additional Rest, Limit Night Flights

The civil aviation regulator has implemented new rules, providing pilots with increased rest periods and limiting their night flying hours. These changes are significant in promoting pilot welfare and flight safety, reflecting a more human-centric approach in aviation regulations.

ReNew to Divest 300 MW Solar Project in ₹1,550 cr Deal

ReNew Power, a leader in decarbonisation solutions, is set to sell a 300 MW solar project in Rajasthan to India Grid Trust for ₹1,550 crore. This deal underlines the dynamic nature of India’s renewable energy sector and ReNew’s strategic business decisions.

Vistara-Air India Merger Expected by Mid-2025

The anticipated merger between Vistara and Air India is projected to be completed by mid-2025. All legal approvals are expected in the first half of this year, and operational integration is underway. This merger represents a significant consolidation in the Indian aviation industry, potentially reshaping the market landscape.

ONGC Reduces KG Basin Crude Output Estimate by 40%

Oil and Natural Gas Corporation (ONGC) has revised its peak crude oil and gas output estimates from the KG basin project down by 35-40%. This significant cut in projections comes even as production commenced from this $5 billion offshore deepwater field, indicating a recalibration of expectations from this key energy project.

Independent Panel Formed for Domestic Natural Gas Auction Grievances

The government has established an ‘independent oversight committee’ to address any grievances that might arise from the auction of domestic natural gas. This committee will handle issues from both buyers and sellers, suggesting a move towards more transparent and fair energy trading practices.

Diesel Demand Drops by 2.5% in December

According to recent oil ministry data, there was a 2.5% drop in diesel demand in December compared to the previous year, while petrol demand remained relatively unchanged. This decrease could signify shifts in energy consumption patterns or broader economic trends.

NCLAT Rejects Jindal Power’s Appeal in Tuticorin Coal Terminal Case

The National Company Law Appellate Tribunal (NCLAT) has dismissed an appeal by Jindal Power Limited against a ruling that prevented them from submitting a resolution plan for the Tuticorin Coal Terminal’s insolvency process. This decision upholds the Mumbai National Company Law Tribunal’s (NCLT) original verdict.

India to Propose Modifications to World Bank Logistics Index

India is examining the World Bank’s Logistics Performance Index to identify areas of improvement and propose necessary changes. This initiative is part of the country’s efforts to enhance its logistics and trade infrastructure.

Consumption Shifting to Lower Income Groups in India: SBI Report

State Bank of India researchers, in a new report, indicate that nearly half of India’s consumption will soon be by the 90% of the population at the lower end of the economic pyramid. This shift challenges the concept of a K-shaped recovery and suggests a closing inequality gap in the country.

Government Increases Financial Support for Residential Rooftop Solar Projects

The Indian government has raised the benchmark central financial assistance for rooftop solar projects in the residential sector. This increase is aimed at promoting the adoption of solar energy and covering the costs of solar panels for homeowners.

Drop in Thali Cost as Tomato and Onion Prices Decrease

A Crisil report indicates that the cost of preparing a thali at home fell by nearly 4% in December, mainly due to the reduction in tomato and onion prices after the festive season. This decrease highlights the influence of seasonal price fluctuations on household budgets.

Oil India Aims for 2.5-Fold Revenue Increase by 2030

Oil India Ltd plans to boost its annual revenues by two and a half times to Rs 1 lakh crore by 2030. This ambitious target will be supported by tripling refining capacity and expanding exploration activities across India, according to the company’s chairman Ranjit Rath.

Dual Pollution Tests Required for Flex Fuel Vehicles

Vehicles with a flex fuel option will now need to undergo two types of pollution tests – for gaseous pollutants and particulate matter – to meet BS VI emission norms. This requirement reflects a growing emphasis on environmental protection in vehicle regulations.

Indian Processed Food Exports Surge by 150% in Nine Years

Piyush Goyal, the minister for commerce & industry, announced that Indian exports of processed food have grown by 150% over the past nine years. He also noted that the country’s agricultural exports have reached about $53 billion during this period, highlighting the robust growth of India’s food industry.

Agriculture Exports Expected to Double to $100 Billion by 2030

Commerce Secretary Sunil Barthwal predicts that India’s agriculture exports will likely double to $100 billion by 2030. This forecast is part of the country’s broader target of achieving $2 trillion in goods and services exports by the same year.

Steady Prices for Non-Basmati Rice Despite Low Supply

The prices of non-premium non-basmati rice remain firm despite the Indian government’s instructions to the trade and industry to reduce prices. This stability in prices is surprising, given the ongoing paddy harvest and the recent ban on exports.

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