Market Walk

Mutual fund NFOs garnered Rs.107,896 crore during the year

India will borrow an additional Rs1 trillion to make up for foregone revenues

With the recent cut in excise on petrol and diesel, India will borrow an additional Rs1 trillion to make up for foregone revenues. The government witnessed higher collections on GST and also on personal income taxes. However, that is offset by sharply higher food and fertilizer subsidies in FY23. Government has already said it will make up the loss in revenues due to excise cuts via market borrowings. However, there is already a warning from Barclays that fiscal deficit could touch 6.9% against the budget forecast of 6.4%.

FY22 was a bumper year for mutual fund NFOs

FY22 was a bumper year for mutual fund NFOs, which garnered Rs.107,896 crore during the year. It was a mix of retail investors gravitating towards mutual funds and robust equity markets overall. Also, the rising interest rate scenario favours equity funds over debt funds. That gave a boost to NFOs as companies look to ride the sentiments to fill up the gaps in their fund offerings. Many of the offerings have been in sectoral funds, which are not limited per AMC. In FY21, total of 84 NFOs collected a sum of Rs42,038 crore.

Hindustan Aeronautics stock scaled a new high price of Rs1,785

Hindustan Aeronautics stock scaled a new high price of Rs1,785, gaining nearly 18% in the last one week. For the March 2022 quarter, HAL had reported 90% yoy growth in net profits on solid order offtake. The revenue growth was relatively muted at 6%. HAL has been one of the major beneficiaries of the Make in India program that has pushed a lot of defence orders into India. Interestingly, most of the defence PSUs in India have been buoyant of late. The company has also been attracting a lot of institutional interest.

Indian government will spend $26 billion to cushion consumers

Indian government will spend $26 billion to cushion consumers from the effects of acutely higher inflation. Inflation at 7.79% in April 2022 was at multi-year highs and RBI has already taken pre-emptive measures like raising repo rates by 40 basis points and amplifying it by hiking the CRR by 50 bps. Government expects subsidy bill to increase from Rs2.15 trillion to Rs2.65 trillion. There could be another round of tax cuts which cost an additional Rs1.50 trillion. FY23 borrowings are already at a record high of Rs14.31 trillion.BHEL reported net profit of Rs909 crore for Q4 FY 22

BHEL reported net profit of Rs909 crore for Q4 FY22

Finally, there was a turnaround in performance of BHEL which reported net profit of Rs909 crore for Q4FY22 compared to a loss of Rs1033 crore in Q4FY21. Top line revenues increased by 12.4% yoy at Rs8,062. Giving a boost to profits, the total expenses of BHEL fell by 18% to Rs7,091 crore. This also meant full year net profits of Rs410.24 crore against a net loss of Rs2,717 crore in FY21. Revenue from operations were up 22.6% at Rs21,211 crore in FY22. BHEL has also declared a final dividend of Rs0.40 per share.

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