Companies and Markets

Companies & Markets

SEBI takedown of rogue manipulators continues

Market regulator Sebi may examine the role of its officials as well as employees in stock exchanges as part of its probe into the leak of names of 37 of the list of 109 mid-cap stocks put under additional surveillance mechanism (ASM). According to sources, Sebi is trying to figure out whether the leak happened at its end or at exchanges, which put the notification on their websites after the trading hours on May 31.

Just half the top guns have kept faith

The fourth quarter earnings season has presented a mixed report card for companies in the Nifty 50 Index. While about 56 per cent companies have come up with numbers in line with or beyond market expectations, the rest have disappointed the Street in the January-March 2018 quarter.

The hiccups in terms of asset quality for banking, financial services and insurance (BFSI) companies and raw material cost pressure on non-BFSI companies have kept the earnings momentum capped for the Nifty-50 companies.

10-year bond yield closes near 8% mark, highest in three years

India's 10-year benchmark bond yield closed near the 8 per cent mark, its highest in three years on Thursday after the Reserve Bank of India (RBI) increased the policy repo rate by 25 basis points and changed liquidity coverage norms. The 10-year bond yield closed at 7.993 per cent, a level last seen on May 7, 2015, from its Wednesday’s close of 7.913 per cent. Bond yields and prices move in opposite directions.

ICICI Bank may file consent plea in Videocon loan case

Under the scanner of investigative agencies over allegations of quid pro quo, ICICI Bank is looking to file a consent plea with the Securities and Exchange Board of India (Sebi) to end the ongoing probe against CEO and managing director Chanda Kochhar (in pic) in the Videocon loan case, according to a news report citing unnamed sources. ICICI Bank refused to comment. A plea agreement means settlement of case without main hearing when the defendant agrees to plead guilty in exchange for a lesser charge or for a more lenient sentence and/or for dismissal of certain related charges.

M&A not real solution, says Sanyal

Even as the finance ministry is considering merger of weak banks with strong ones, Sanjeev Sanyal, principal economic adviser, said merger is not a “big solution” to the problems of state-owned lenders. “Consolidation and merger of banks can be done as one of the many things. It is not even a first order solution. The first priority is to clean up the balance sheets of banks and see that the IBC process is carried through to its logical end so that banks make recoveries,” he said.

Consumer loan rates to go up

With RBI reversing its interest rate cycle, consumer loan rates are likely to go up. While some of the banks have already hiked MCLR rates, others are likely to follow suit. This will make home, auto, personal and business loans dearer. “There is no option other than increasing lending rates as the cost of funds have gone up. Commerical paper has become costlier by 100 basis points since March. Banks are raising funds through public deposits and CDs and their cost of funds are going to further go up,” said Asuthosh Khajuria, ED and CFO of Federal Bank.

Hike to hurt growth prospects: Industry

The 25 basis points rate hike by the RBI will hurt India’s growth prospects and exhorted the central bank to revert to the policy of benign interest rates, said the industry on Wednesday.

However, a section from India Inc said the decision of the Reserve Bank (RBI) was a clear hint to the industry to push for growth by taking investment decisions, while some believe the central bank’s hawkish monetary policy stance is here to stay for a while.

IDFC Bank, Capital First shares gain on RBI nod for merger

Shares of IDFC Bank on Wednesday surged over 7 per cent after it said it has received RBI's approval for merger of Capital First, Capital First Home Finance and Capital First Securities with the company.

The stock soared 7.32 per cent to end at Rs 41.05 on the BSE. During the day, it jumped 8.49 per cent to Rs 41.50. On the NSE, the shares surged 7 per cent to close at Rs 41.05.

 Shares of Capital First also rose by 5.32 per cent to close at Rs 561.35 on BSE.

Electrosteel allots shares worth Rs 7,400 cr to lenders

Electrosteel Steels, undergoing the insolvency resolution process, has allotted equity shares worth Rs 7,400 crore to lenders as loan conversion, with SBI getting the largest chunk— about 37 per cent.

The company had on Tuesday spelt out steps to be taken for completion of its takeover by Vedanta Star, an arm of mining giant Vedanta which won the bid to acquire the stressed firm.

It has allotted nearly 740 crore equity shares to 26 lenders, out of which the country's largest lender, State Bank of India, got the largest 36.70 per cent chunk—271.61 crore equity shares.

Dealscape gets larger

After hitting a five-year low in 2017, mergers and acquisitions (M&A) saw a quantum leap this year, with May creating a new record in M&A and private equity (PE) transactions, thanks largely to the $16-billion Walmart-Flipkart deal.

The year so far has recorded 542 deals—including M&A and PE—worth a staggering $71 billion, a significant 86 per cent increase by value. This also marks the highest year-to-date values recorded.

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