Daily Market Highlights Jul 28

3 Daily Market Highlights Jul 28

Previous Day Market

Sensex Closed At 52,578.76 down  by 273.51  points 

Nifty Closed At 15,746.45 down by 78.00  points 

IMF scaled down India’s GDP growth projection by 300 basis points to 9.5% for FY22 on account of COVID 2.0. This was revealed by IMF in its latest edition of the World Economic Outlook report. This puts the IMF projections at par with the RBI. IMF expects India to grow at 8.3% in calendar 2021, which would still make India the fastest growing large economy. According to the IMF WEO, the impact of COVID future variants will be limited in case of countries like the UK and Canada where substantial vaccine penetration is done.

Interglobe Aviation net loss for the Jun-21 quarter widened to Rs.3,174 crore as it was simultaneously hit by tepid air traffic, higher crude prices and a sustained depreciation of the Indian rupee. In the Mar-21 sequential quarter, Interglobe had posted net loss of Rs.1,160 crore. COVID 2.0 led to a sharp drop in air traffic impacting revenues severely. Revenues were lower by -51.6% at Rs.3,007 crore. For the Jun-21 quarter, fuel costs spiked by 67.3%. Meanwhile its total debt has ballooned by 35% at Rs.31,690 crore.

The stocks of Equitas Holdings and Equitas SFB rallied sharply after their respective boards approved the scheme of amalgamation. Under the approved scheme, Equitas SFB will issue 226 shares for every 100 shares of Equitas Holdings held. Post the deal, Equitas Holdings will be dissolved without being wound up. This will not only do away with the need to gradually reduce stake in the SFB to below 40%, but also save Equitas Holdings from the holding company discount. Equitas Holdings has 81.75% stake in Equitas SFB.

Canara Bank Jun-21 quarter net profits were up 190% at Rs.1,177 crore on the back of higher non-interest income and lower provisioning for bad loans. For Canara Bank, the net interest income or NII rose by 0.84% in the Jun-21 quarter to Rs.6,147 crore. Canara Bank also reported net interest margins or NIMs of 2.71% against 2.84% last year. This is sharply lower than private sector banking median. Gross NPAs were 34 bps lower at 8.50% in the Jun-21 quarter even as the Provision Coverage Ratio or PCR stood at 81.18%.

ICICI Lombard and SVAAS Wellness, a unit of Reddy’s Laboratories, have tied up to offer cashless out-patient services to health insurance policyholders. It will mark the launch of the Reddy Labs digital health solution SVAAS and also mark ICICI Lombard’s deeper penetration in the wellness space. The pilot project will be launched in Hyderabad and Visakhapatnam and subsequently scaled up to major metros large cities. This will be a unique offering in that the entire offering will be app driven and operated digitally.

Adani Ports and SEZ announced that it had raised $750 million via the issue of bonds. This includes a 20-year unsecured bond issue in the international markets. The company has set the coupon for the 10.5 year tranche at 3.8% and the 20-year tranche at 5%. The appetite was visible with the issue oversubscribed over 3 times. APSEZ became the first Indian infrastructure company to successfully raise 20-year money from global markets. The advantage for APSEZ is that it has a natura hedge through its export earnings.

Torrent Gas, the gas distribution arm of Torrent Group of Gujarat, will invest Rs.5,000 crore in the state of Tamil Nadu over next 5 years to lay infrastructure for its city gas distribution or CGD business. Torrent Gas will invest Rs.10,000 crore across the country. This is on top of Rs.1,900 crore it has already invested in CGD in India. Torrent has already launched its operations in Chennai. Torrent will add 25 CNG stations in Chennai and Tiruvallur, scaling up the network of 214 to 350 operational CNG stations all across India.

As Vodafone Idea increasingly gets into a financial tangle, there are concerns being raised about the asset quality of Yes Bank and IDFC First Bank. Both these banks have huge exposures to Vodafone Idea. For now, the survival of Vodafone Idea depends on fund raising plans. For Yes Bank, the exposure to VI is 2.44% of its loan book while for IDFC First Bank it is 2.91% of loan book. The highest absolute exposure to VI at Rs.11,000 crore is with SBI. VI also has a massive Rs.43,000 crore of pending AGR dues to the DOT.

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%name Daily Market Highlights Jul 28

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