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Market Ahead with EZWealth – 10 Nov 2021
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India on way to becoming fastest growing economy in world: Finance Ministry report
Armed with necessary macro and micro growth drivers, India is on its way to becoming the fastest growing major economy in the world, a finance ministry report said. Rapid vaccination and teeming festivities will push India’s ongoing recovery resulting in narrowing of demand-supply mismatches and greater employment opportunities, as per the monthly Economic Review prepared by the ministry.
“Aatmanirbhar Bharat Mission encapsulating major structural reforms continues to play a critical role in shaping India’s economic recovery, both through the signalling of business opportunities and expansion of spending channels. Armed with necessary macro and micro growth drivers, the stage is set for India’s investment cycle to kickstart and catalyse its recovery towards becoming the fastest growing economy in the world,” the review said.
The Economic Survey 2020-21, released in January this year, had projected GDP growth of 11 per cent during the current financial year ending March 2022. The Survey had said growth will be supported by supply-side push from reforms and easing of regulations, push for infrastructural investments, boost to manufacturing sector through Production-Linked Incentive (PLI) schemes, recovery of pent-up demand, rise in discretionary consumption subsequent to rollout of vaccines and pick-up in credit given adequate liquidity and low interest rates.
India retains top 10 slot in climate performance index; no country cracks top 3
India has retained its top 10 spot in the best performing countries for the third year in a row in the global Climate Change Performance Index (CCPI) released by Germanwatch on the side-lines of the COP26 on Tuesday. No country performed well enough in all index categories to achieve an overall very high rating in CCPI, the report noted. As a result, the top three places in the overall ranking remain empty once again.
Denmark placed 4th and is the highest ranked country in CCPI 2022. However, it does not perform well enough to achieve an overall very high rating. Thus India at the 10th slot is the seventh best performing country. India maintained its 10th position despite pandemic-hit operational difficulties which saw some regulatory flexibility to put the country’s economy back on track. Performance of G20 countries, responsible for about 75% of the world’s GHG emissions, shows the UK (7th), India (10th), Germany (13th), and France (17th) are four G20 countries among the high-performers. China is the current biggest polluter and figured at 37th position, falling down three spots since last year, while the second highest current emitter — US — was at the 55th spot in the CCPI 2022.
India’s coal import 12% drops to 94 MT in April-August
The government said the country’s total coal import dropped 12 per cent year-on-year (y-o-y) to 94.15 million tonnes (MT) in April-August 2021, on account of a substantial reduction in the import of non-coking coal. This has resulted in considerable financial savings in the current year as coal prices are going up sharply in the international market, the coal ministry said in a statement.
“Due to a substantial reduction of import of non-coking coal in the current year, the total import of coal has also reduced to 94.15 MT in the period from April to August 2021 as compared with 107.01 MT during the corresponding period of 2019-20, a decrease of about 12 per cent,” the statement said. The import of all varieties of non coking coal reduced 16.09 per cent to 70.85 MT in the April-August period of the ongoing fiscal over the corresponding months of FY 2019-20. The country had imported 84.44 MT of all varieties of non coking coal during the corresponding months of the financial year 2019-20, the statement said.
Global carmakers now target $515 billion for EVs, batteries
Global automakers are planning to spend more than half a trillion dollars on electric vehicles and batteries through 2030, according to a Reuters analysis, amping up investments aimed at weaning car buyers away from fossil fuels and meeting increasingly tough decarbonization targets. Less than three years ago, a similar analysis by Reuters found car companies planned to spend $300 billion on EVs and related technologies. But looming zero-carbon mandates in cities such as London and Paris and countries from Norway to China have lent additional urgency to the industry’s EV-related investment commitments.
The most recent analysis shows carmakers planning to spend an estimated $515 billion over the next five to 10 years to develop and build new battery-powered vehicles and shift away from combustion engines. But industry executives and forecasters remain concerned that consumer demand for EVs could fall well short of aggressive targets without substantial additional incentives and even greater spending on charging infrastructure and grid capacity. Brian Maxim, head of global powertrain forecasting at AutoForecast Solutions, likens the growing investment commitments in vehicle electrification to the Cold War: ”Once a few manufacturers announced EV programs, everyone else had to announce their own or be viewed as being left behind.”
Nykaa makes a stellar debut, stock lists at Rs 2,018 with 79% premium
FSN E-Commerce Ventures, the operator of Nykaa and Nykaa Fashion chain, made a bumper debut as the stock listed with a massive 79 percent premium on November 10. The share opened at Rs 2,001 on the BSE, while the listing price on the National Stock Exchange was Rs 2,018. The Rs 5,352-crore public issue saw a huge demand and was subscribed 81.78 times during the October 28-November 1 period, receiving bids for 216.59 crore equity shares against the offer size of 2.64 crore shares.
Qualified institutional buyers and non-institutional investors showed strong interest in the offer, as their reserved portion was subscribed 91.18 times and 112.02 times, respectively. The shares set aside for retail investors were subscribed 12.24 times and that of employees 1.88 times. FSN E-Commerce Ventures, a digital native consumer technology platform, is promoted by banker-turned-businesswoman Falguni Nayar and backed by private equity firm TPG Group.
The Indian beauty and personal care (BPC) market is estimated to grow at approximately Rs 2 lakh crore by 2025 from Rs 1.1 lakh crore in 2020, and the Indian fashion market is expected to grow to approximately Rs 8.7 lakh crore by 2025 from Rs 3.8 lakh crore in 2020.
Tata Motors, Mahindra & Mahindra dodge chip shortage with innovation
Auto companies hamstrung by the continuing semiconductor shortage are taking countermeasures such as bringing down chip usage per vehicle or offering cars with fewer chip-dependent features. Tata Motors and Mahindra & Mahindra (M&M) have undertaken these measures in a desperate effort to improve vehicle supplies and bring down the waiting period, which, in certain cases, is at a staggering 12 months. Both companies are estimated to be sitting on over 300,00 pending orders.
Tata Motors, India’s third-largest carmaker, has dramatically cut the number of chips used per vehicle. The maker of Safari SUVs has halved the number of chips used in one specific component that powers the vehicle. While Tata Motors officials did not identify the vehicle model, they said that the company was working on optimisation of chips to tide over the supply crisis.
In a post-earnings conference call, Shailesh Chandra, President (Passenger Vehicle Business Unit), Tata Motors, said, “In one component we were able to successfully bring down the number of semiconductors that we were using to half. We have been looking to convert application-specific chips to standard chips and we have gone in for optimisation of chips, which is about reducing usage of chips and validating them in a very short period.”
To get around the shortage, M&M has created step-down variants of the in-demand XUV700 SUV, which lack some features that customers had opted for. For instance, the chip-dependent wireless mobile charging feature has been removed by the company in the flagship SUV before being offered to the customer. Speaking to Moneycontrol, Rajesh Jejurikar, Executive Director (Automotive and Farm Equipment Sectors), M&M, said, “There are specific shortages of semiconductors that go into high-end products. We may adapt some of our variant offerings in XUV700 to give customers the option of giving up some features on a lower-price setoff, depending on the kind of shortages.”
India’s hospitality sector witnessed a 169.4% YoY increase in RevPAR in Q3: JLL
The Indian hospitality industry witnessed a growth of 169.4% in revenue per available room (RevPAR) in Q3 2021 (July – September) compared to Q3 2020, according to consultancy JLL’s Hotel Momentum India Q3 2021, a quarterly hospitality sector monitor. At a pan India level, there has been a 122.9% growth in RevPAR in Q3 2021 as compared to Q2 2021, due to strong recovery in leisure demand as travel restrictions were eased post the second wave of the pandemic. The firm said the year-on-year growth witnessed in the sector during Q3 2021 is primarily due to the low base effect of Q3 2020 as the nation began to cautiously ease travel restrictions.
According to the company, for the next two quarters, the growth in travel is expected to continue as India further ramps up its vaccination rate resulting in improved sentiments.IT/ITeS companies have indicated that their travel expenditure will increase in the coming quarter as they foresee employees resuming travel for work. Leisure locations are expected to see a further increase in occupancy and average rates supported mainly by transient leisure and social gatherings.
Coronavirus Update | India records 11,466 COVID-19 cases, 460 deaths
India recorded a single-day rise of 11,466 COVID-19 cases on Wednesday, taking the country’s tally of infections to 3,43,88,579, while the count of active cases has declined to 1,39,683, the lowest in 264 days, Union Health Ministry data showed. The death toll due to the disease climbed to 4,61,849, with 460 daily fatalities being recorded, according to the data updated at 8 am.
The daily rise in new coronavirus infections has been below 20,000 for 33 straight days. Less than 50,000 daily new cases have been reported for 136 consecutive days now. The tally of active cases has declined to 1,39,683 which comprises 0.41 per cent of the total infections, the lowest since March 2020, while the national COVID-19 recovery rate was recorded at 98.25 per cent, the highest since March 2020, the ministry said. This has been less than two per cent for 37 days. The daily positivity rate was recorded at 0.90 per cent. This has been less than two per cent for 37 days. The weekly positivity rate was recorded at 1.20 per cent.
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Stocks in the news
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S H Kelkar & Company share price jumped more than 7 percent in the morning session on November 10, continuing the rally in the stock that has surged over 34 percent in the last five days after Swiss firm Firmenich bought Blackstone’s 10 percent stake in the fragrance maker. “Blackstone has sold its existing 10.4 percent stake in the firm via a block deal and clocked an overall return of 4.5x,” sources said on November 9.
Zee Media Corporation share price added over 2 percent intraday on November 10 after the company had received a proposal from a promoter group entity for the further investment in the company. A meeting of the board of directors of Zee Media Corporation is scheduled to be held on November 12, 2021, to consider, approve and take on record un-audited financial results of the company for the second quarter (Q2) and six months period ended September 30, 2021 of the Financial Year 2021-2022, company said in the release.
TTK Prestige: Net Sales at Rs 858.55 crore in September 2021 up 34.86% from Rs. 636.63 crore in September 2020. Quarterly Net Profit at Rs. 103.53 crore in September 2021 up 57.72% from Rs. 65.64 crore in September 2020. EBITDA stands at Rs. 151.36 crore in September 2021 up 54.06% from Rs. 98.25 crore in September 2020. TTK Prestige EPS has increased to Rs. 74.69 in September 2021 from Rs. 47.21 in September 2020.
BHEL: Net Sales at Rs 5,112.19 crore in September 2021 up 38.32% from Rs. 3,695.96 crore in September 2020. Quarterly Net Loss at Rs. 45.98 crore in September 2021 up 91.67% from Rs. 552.02 crore in September 2020. EBITDA stands at Rs. 55.10 crore in September 2021 up 110.28% from Rs. 536.15 crore in September 2020.
Wockhardt: Net Sales at Rs 862.00 crore in September 2021 up 20.72% from Rs. 714.05 crore in September 2020. Quarterly Net Profit at Rs. 33.53 crore in September 2021 up 844.51% from Rs. 3.55 crore in September 2020. EBITDA stands at Rs. 101.03 crore in September 2021 up 206.71% from Rs. 32.94 crore in September 2020. Wockhardt EPS has increased to Rs. 3.03 in September 2021 from Rs. 0.32 in September 2020.
Nahar Polyfilm: Net Sales at Rs 104.37 crore in September 2021 up 36.23% from Rs. 76.62 crore in September 2020. Quarterly Net Profit at Rs. 23.21 crore in September 2021 up 45.57% from Rs. 15.94 crore in September 2020. EBITDA stands at Rs. 24.05 crore in September 2021 up 48.18% from Rs. 16.23 crore in September 2020. Nahar Poly Film EPS has increased to Rs. 9.44 in September 2021 from Rs. 6.48 in September 2020.
MRF: Net Sales at Rs 4,907.81 crore in September 2021 up 15.63% from Rs. 4,244.43 crore in September 2020. Quarterly Net Profit at Rs. 189.06 crore in September 2021 down 53.99% from Rs. 410.92 crore in September 2020. EBITDA stands at Rs. 609.90 crore in September 2021 down 33.08% from Rs. 911.38 crore in September 2020. MRF EPS has decreased to Rs. 445.77 in September 2021 from Rs. 1,000.63 in September 2020.
OnMobile Global: Net Sales at Rs 130.43 crore in September 2021 down 6.82% from Rs. 139.97 crore in September 2020. Quarterly Net Profit at Rs. 2.66 crore in September 2021 down 65.05% from Rs. 7.61 crore in September 2020. EBITDA stands at Rs. 9.67 crore in September 2021 down 36.42% from Rs. 15.21 crore in September 2020. OnMobile Global EPS has decreased to Rs. 0.25 in September 2021 from Rs. 0.74 in September 2020.
Hindustan Copper: Net Sales at Rs 464.46 crore in September 2021 up 57.62% from Rs. 294.67 crore in September 2020. Quarterly Net Profit at Rs. 67.72 crore in September 2021 up 640.11% from Rs. 9.15 crore in September 2020. EBITDA stands at Rs. 118.65 crore in September 2021 up 44.77% from Rs. 81.96 crore in September 2020. Hind Copper EPS has increased to Rs. 0.70 in September 2021 from Rs. 0.10 in September 2020.
Uflex: Net Sales at Rs 3,027.31 crore in September 2021 up 35.83% from Rs. 2,228.75 crore in September 2020. Quarterly Net Profit at Rs. 170.74 crore in September 2021 down 23.03% from Rs. 221.82 crore in September 2020. EBITDA stands at Rs. 424.51 crore in September 2021 down 10.22% from Rs. 472.85 crore in September 2020. Uflex EPS has decreased to Rs. 23.64 in September 2021 from Rs. 30.72 in September 2020.
Aurobindo Pharma share price was up 3 percent at Rs 698 in the afternoon trade on November 10, as global brokerage firm CLSA upgraded the stock to “buy” from “outperform”, with the target at Rs 830 a share, an upside of 19 percent from the current market price.
Oracle and Bharti Airtel have extended their partnership to drive growth of digital economy by bringing a slew of cloud solutions to over 1 million enterprise customers. Oracle will leverage ‘Nxtra’ by Airtel’s data centre network to expand its cloud presence in India. Further Airtel Business will offer Oracle Cloud Infrastructure to its million plus enterprise customers, according to a statement. Oracle and Airtel would also set up a Cloud Centre of Excellence in Gurgaon with a dedicated team of specialists from both organisations. These experts will help modernise Airtel’s internal workloads, and enable customers to adopt cloud and fully benefit from it.
India Cements share price fell 6 percent to Rs 209.10 intraday on November 10 after the company reported declines in its September quarter net profit. The India Cements share touched a 52-week high of Rs 232.05 intraday. The company has reported a 69.2 percent fall in its Q2 net profit at Rs 21.97 crore versus Rs 71.43 crore last year. Its revenue was up 11.3 percent at Rs 1,190.17 crore from Rs 1,069.72 crore a year ago.
Vodafone Idea has held talks with lenders, including consortium lead State Bank of India (SBI), for a possible recast of loans through a potential standstill on interest payments, longer repayment tenures or lower rates, two people familiar with the discussions told ET. The recast, if approved, could ease the financial strain on the telco that has a funded exposure of nearly ₹14,000 crore. SBI alone has an exposure of about Rs 11,000 crore
Adani group companies– Adani Green Energy NSE -1.10 % and Adani Transmission— have made commitments towards United Nations’ ‘Sustainable Development Goal 7’ (SDG 7) which calls for to ensure access to affordable, reliable, sustainable and modern energy for all by 2030, the Gautam Adani-led company said in a statement on Tuesday.
Naveen Jindal-led Jindal Steel and Power (JSPL) plans to clock around ₹50,000 crore of sales revenue by the end of FY22 with 8 Mt of production. The company also plans to bring down the company’s net debt to ₹8,000 crore from a peak of around ₹22,146 crore as of FY21.
Praj Industries and Indian Oil Corporation Limited (IndianOil) have inked an MoU to explore opportunities such as the production of Alcohol to Jet (ATJ) fuels, 1G & 2G Ethanol, Compressed Bio-Gas (CBG) and related opportunities in the Biofuels industry, informed Praj in a press release.
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