Companies and Markets

Companies & Markets

Can budget drive market hopes?

The market has reacted positively to budget on hopes of consumption boost Equity markets have reacted positively to the budget, as the headline fiscal deficit does not signal major loosening, and there are hopes that giveaways will aid both rural and urban consumption. The bond market's reaction supports the concern over ambitious revenue assumptions and risk of further fiscal slippage.

Aviation sector turbulent times

We initiate coverage on the Aviation sector with a positive view given huge scope of growth in the Indian market. We believe that Low Cost Carriers (LCCs) will do well in the long term given attractive fares, low turnaround time (40% less) and tight control over costs. Notwithstanding near-term turbulence, rising air penetration rates, expanding middle class income and induction of fuel and cost efficient aircrafts (15% fuel savings) will enable profitable growth in coming years.

Limited awareness among SMEs restricts growth of online lending platforms

Online lending platforms have not still made significant inroads into the SME sector as lower awareness about the platforms and lower user satisfaction is keeping the growth restricted.

Digital lending platforms like Indifi, Capital Float and NeoGrowth Credit have an addressable market of $200 billion for providing short-term credit for around 60 million MSMEs and the size of the opportunity is $20 -30 billion if one takes only the digitally-savvy SMEs. However, the online lenders have not been able to make a headway into the SME market, finds RedSeer consulting. 

An in-line budget to aid up-move

The Sensex surged 665.44 points or 1.87 per cent to settle at 36,256.69, while the Nifty 50 advanced 179.15 points or 1.68 per cent to settle at 10,830 on the day of F&O settlement for the January series.

However, the broader market underperfo­r­m­ed with the BSE Mid-Cap and BSE Small-Cap indices rising 0.42 per cent and 0.80 per cent, respectively.

Among the sectoral indices on the BSE, IT (up 2.13 per cent) and Energy (up 2.1 per ce­nt) outperformed the Sensex.

Airtel Q3 net income plunges 72% to Rs 86 crore; payments bank helps bolster finances

Bharti Airtel on Thursday reported a 72 per cent drop in consolidated net income for the three months ended December 2018 at about Rs 86 crore, amid market turbulence triggered by cut-throat competition in its India business.

A hange in the accounting structure with respect to Airtel Payments Bank brought an exceptional gain of Rs 1,017 crore for Bharti Airtel and bolstered the company’s financials.

Muthoot wants to take chit fund pan-India, reach out to millennials and executives

Despite being a convenient product offering the benefits of savings and credit, chit fund has hardly penetrated among the youngsters and still remains an old-world financial instrument. Muthoot Pappachan Chits wants to reach out to the millennials and corporate executives by offering digitized service. It aims at becoming a pan-India player in a highly unorganised segment with a few organised regional players.

Chalet Hotels IPO gets almost nil response from retail investors

There was poor response from retail individual and high net worth investors to the new year’s first big initial public offering in the primary market by K Raheja Group promoted Chalet Hotels.

Chalet Hotels’ Rs 1,640 crore IPO was oversubscribed 1.58 times the issue size on the last day of the public issue largely due to qualified institutional investors bidding 4.65 times shares reserved for them excluding anchor investor allotments.

Retail individual investors bids came for just 0.03 times shares reserved for them while HNIs’ bid 1.11 time-shares reserved for them.

Surprises for investors, middle class likely

The interim Budget, to be presented by finance minister Piyush Goyal on Friday, will have some specifc sops aimed at cheering the investor community, and by extension, the stock market.

According to officials, there is a strong possibility of changes in the income tax rates and corporate tax rates but all these direct tax rates will come into effect only after the next government takes charge and the new Lok Sabha passes them.

Sensex bounces on short covering, dovish Fed tone

The market surged on Thursday ahead of the interim budget, as heavy short-covering on expiry of the January series futures and options (F&O) contracts buoyed the benchmark Sensex to close above the psychological 36,000-mark with a 665-point gain.