Weekly Capsule (Apr19 – Apr23)

weekly 2 Weekly Capsule (Apr19 – Apr23)

News AnnouncementImpact Analysis
·        HCL Tech net profits fell by 65% yoy to Rs1,011 crore in the Mar-21 quarter·        At an operating level, there was a sharp spike in employee benefit cost due to the special bonus paid

·        In addition, the tax costs were also higher due to the additional provisions made for accounting for goodwill

·        RBI bars American Express and Diners from taking new customers from May·        Both the premium card issuers were found non-compliant of the RBI regulations to store payment system data locally

·        However, this ban only applies to onboarding customers and will not impact the existing customers in any way

·        The Indian Rupee closed the week weaker at the Rs.75.01/$ levels·        The weak show by the rupee was largely on account of the rising spate of COVID cases and its likely impact on growth

·        However, the rupee fall had started after the monetary policy wherein the RBI had announced introduction of GSAPs

·        MPC minutes show clear bias towards inflation caution amidst growth focus·        All the six members of the MPC agreed that a spike in inflation remained the biggest risk factor to accommodative policy

·        The MPC members also stressed on the need to shift to data-driven guidance rather than time-based monetary guidance

·        In the midst of the COVID scare, the bigger scare has been oxygen shortage·        This shortfall had already led to many oxygen storage companies seeing a runaway rally in stock prices

·        Meanwhile Ministry of Defence will airlift a total of 23 oxygen generation plants directly from Germany

·        With multiplexes likely to remain shut for longer, film releases may go digital·        In the previous year, many large banners had withheld their movie releases till the multiplexes opened

·        However, if the lockdown continues, most producers may seriously consider a 100% digital release of their movies

·        Angel Broking appointed Narayan Gangadhar as its CEO·        This was necessitated after its current CEO, Vinay Agarwal, passed away during the previous week at the age of 44

·        Gangadhar is a technology veteran having spent time in Amazon, Google and Microsoft, showing their tech focus

·        Indian Oil operates at 95% capacity due to weak oil demand·        Due to the COVID resurgence, petrol demand is likely to drop by 100,000 bpd in Apr-21 and diesel by 220,000 bpd

·        Even for the month of May-21, petrol demand is expected to drop by 170,0000 bpd and diesel by 400,000 bpd

·        D&B Survey expects COVID resurgence to hit 75% of MSMEs in India·        The survey also pointed out that the negative impact will be more pronounced on manufacturing than on services

·        The survey also highlighted that most of the respondents expected the recovery to take more than a year for MSMEs

·        Power Grid plans Rs.7700 crore IPO through the INVIT route·        This will allow Power Grid to monetize its assets and hive it off to long term institutional investors like insurers and PFs

·        It would also be a big boost to the government in meeting its Rs.175,000 crore divestment target for fiscal year 2021-22

·        Sugar stocks rally to 52-week high levels during the week·        The government incentives for sugar exports has made the Indian sugar industry less cyclical in nature

·        In addition, the decision to push ethanol blending to 20% of petrol by 2025 offers a long-term story for sugar stocks

·        Banks clarify that Future group debt recast plan will be cancelled after deal·        The idea of this clarification was to underline that the recast was just Plan-B to help Future group survive till the deal

·        The Rs.24,713 crore merger deal with Reliance Retail is held up in the courts due to objections raised by Amazon

·        ICICI Securities reported doubling of net profits at Rs.329 crore·        The profit boost was led by 54% revenue growth as well as reduction in the cost ratio from 57% to 40%

·        ICICI Securities has also been a big beneficiary of the rapid growth in demat and trading accounts during the year

·        Indiabulls ties up with HDFC in a joint co-lending partnership for home loans·        HDFC will carry 80% of the loan in its balance sheet while Indiabulls will manage the entire process flow

·        Indiabulls gets a bigger balance sheet as well as a wider reach in Tier-3 and Tier-4 cities and towns in India

·        FPI holding in Indian equities goes up to $555 billion as of March 2021·        This is a gain of nearly $105 billion in holding value since Sep-20, led by fresh FPI inflows and value accretion in the rally

·        In the fiscal year 2021-22, FPIs were net buyers in Indian equities to the tune of $37 billion

·        Bharat Biotech announced 78% efficacy for the results of its Covaxin·        This is slightly lower than the 81% efficacy in the previous round but those kind of fluctuations are quite normal

·        The Phase 3 was rolled out to 25,800 participants and Bharat Bio is confident of being able to go live by June this year

·        RBI appoints committee for revamping ARC norms in India·        The committee, headed by Sudarshan Sen, will look to review and revamp most of the extant ARC regulations

·        It will review the existing regulatory and legal framework and also suggest ways to improve the efficacy of the process

·        Start-up Druva raises $150 million in the latest round of funding·        Druva is focused on cloud-based data management and development ops to centrally protect valuable data

·        The stake was sold to the Canadian pension fund, CPDQ, while Viking Global and Atreides also participated in this round

·        Nestle reported 14% growth in net profits at Rs.603 crore for Q1·        Nestle witnessed double-digital growth in domestic top line but the global export sales faltered on weak demand

·        Nestle has cautioned investors that rising raw material costs could be a major headwind for the stock

·        LIC and Paytm have tied up for managing the LIC digital ecosystem·        LIC already has digital collections of Rs.60,000 crore per year and Paytm will give an integrated payment solution

·        Apart from digitizing customer payments, LIC also looks to integrate agent transfers as part of the digital ecosystem

·        Glenmark stock rallies on proposed listing of Glenmark Life Sciences·        Glenmark Life Science subsidiary focuses on the lucrative active pharma ingredients or API space for Glenmark group

·        As per the DRHP, Glenmark Life will raise Rs.1,160 crore via fresh issue and also sell 73 lakh shares as part of OFS

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