Shares of IndusInd Bank rose more than 7% on Monday, making it the biggest gainer in the Nifty bank index. Why is there a sudden optimism with this stock? The main reason is that t ... Read more
Shares of IndusInd Bank rose more than 7% on Monday, making it the biggest gainer in the Nifty bank index. Why is there a sudden optimism with this stock? The main reason is that the bank’s promoters, the Hinduja Group want to increase their stake from the current 14.68% to at least 26%. True, a promoter increasing stake would mean there is more skin in the game. But there’s a catch here. Listen in to find out. Read more
India’s largest lender, State Bank of India sounded optimistic on delinquencies in a year when every other bank is predicting a surge in bad assets. The coronavirus pandemic is exp ... Read more
India’s largest lender, State Bank of India sounded optimistic on delinquencies in a year when every other bank is predicting a surge in bad assets. The coronavirus pandemic is expected to increase unemployment and push many small businesses into bankruptcy. That pain is sure to be reflected in SBI’s asset quality. But chairman Rajnish Kumar is hopeful that this pain would be limited. As such, only 23% of the bank’s loan book is under moratorium. The repayment holiday which was allowed by the regulator is for six months to borrowers. While SBI expects to keep its bad loans under check, it has opted to make higher provisions. It has also gone a step ahead and decided not to take the benefit of forbearance on loans where repayment schedules were altered. In other words, though SBI did not mark loans as non-performing, it has provided against them like they would be a bad asset. SBI’s shares surged over 8% on Friday because of this optimistic guidance and the highest yearly net profit it reported for FY20. The bank has however said that it would be prudent to assess borrowers and their repayment strength once the moratorium is over in August. A clear picture will emerge only in September. Read more
In the week that global rating agency Moody’s downgraded India’s rating, the Nifty 50 index has reclaimed the 10000 marks. The index is now almost 33% higher since its lows on the ... Read more
In the week that global rating agency Moody’s downgraded India’s rating, the Nifty 50 index has reclaimed the 10000 marks. The index is now almost 33% higher since its lows on the day the first lockdown was announced. What are the reasons for this optimism? Read more
After a little over two months, the withdrawal of the government of India’s strictest lockdown has brought cheer to the equity markets. The Nifty 50 index increased by about 2.6% o ... Read more
After a little over two months, the withdrawal of the government of India’s strictest lockdown has brought cheer to the equity markets. The Nifty 50 index increased by about 2.6% on Monday. The lockdown hit businesses hard in April and May. So what is the impact of Unlock 1? Well, much of the revival hinges heavily on how soon consumption demand picks up. Many sectors will see a slow path towards normalization in business activity. Read more
Pharmaceutical companies have been a bright spot amid a general gloom during this COVID-19 pandemic. The Nifty Pharma has been the top-performing index in 2020. It has given a 20% ... Read more
Pharmaceutical companies have been a bright spot amid a general gloom during this COVID-19 pandemic. The Nifty Pharma has been the top-performing index in 2020. It has given a 20% return this year at a time when all other sector indices are giving negative returns. It is not because they have found a cure for covid-19 but rather because they have underperformed in the past several years. Besides, demand for drugs across the globe have risen. Read more
The lockdown imposed to curb the spread of COVID-19 pandemic has meant that borrowers are unable to repay their loan instalments on time. Banks have given a six months moratorium b ... Read more
The lockdown imposed to curb the spread of COVID-19 pandemic has meant that borrowers are unable to repay their loan instalments on time. Banks have given a six months moratorium but now the fear is that even after the moratorium is over, borrowers won’t be able to start paying their EMIs. To absorb such losses, banks need capital. Credit Suisse estimates that Indian banks need $20 billion capital to absorb these losses. Public sector banks are in a far worse position to raise capital. Unlike private sector banks, going to the market to raise money won’t get them much. Read more
Bharti Telecom, a promoter of Bharti Airtel, has sold 152 million shares for about Rs8,500 crore in a block deal on Tuesday. This will help Bharti Telecom repay its entire debt wor ... Read more
Bharti Telecom, a promoter of Bharti Airtel, has sold 152 million shares for about Rs8,500 crore in a block deal on Tuesday. This will help Bharti Telecom repay its entire debt worth Rs8,500 crore. The shares were sold at a time when Airtel shares were at an all-time high. Airtel shares fell over 5% on Tuesday, as the deal was done at a discount of about 5% to its previous closing price. Even so, the share sale should not unnerve investors. Here's why. Read more
The RBI has reduced its policy rate by 40 basis points. It has extended the benefits of loan moratorium and working capital interest deferral to 31 August. In short, if you are a b ... Read more
The RBI has reduced its policy rate by 40 basis points. It has extended the benefits of loan moratorium and working capital interest deferral to 31 August. In short, if you are a businessman, you still have more time to pay back your loan. Read more
Bharti Airtel and Jio’s March quarter results were strikingly different. There was hardly any sign of the December tariff hikes in Jio’s results. On the other hand, Bharti Airtel’s ... Read more
Bharti Airtel and Jio’s March quarter results were strikingly different. There was hardly any sign of the December tariff hikes in Jio’s results. On the other hand, Bharti Airtel’s average revenue per user or ARPU expanded by 14% last quarter compared to Jio’s Arpu growth of a mere 1.7%. Airtel’s India wireless business grew by 16% sequentially, much higher than Jio’s 6% growth. This implies massive market share gains for Airtel. Overall, Airtel saw a 27% sequential jump in operating earnings at it's India wireless business. Read more
For airline companies, there is no help coming from the government. Smaller airlines such as SpiceJet are under far greater pressure with almost no cash to speak of before the lock ... Read more
For airline companies, there is no help coming from the government. Smaller airlines such as SpiceJet are under far greater pressure with almost no cash to speak of before the lockdown began. On the other hand, IndiGo’s large cash pile is helpful in these times and puts it in the best place in the Indian aviation sector to deal with this crisis. As such, near-term revenue and capital outlook remain grim for the sector. Read more
