The Reserve Bank of India on Thursday opted for a pause second time in a row, maintaining key benchmark policy rate at 6.5 per cent as inflation moderates. The rate increase cycle was paused in April after six consecutive rate hikes aggregating to 250 basis points since May 2022. Announcing the bi-monthly monetary policy, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) unanimously decided to keep the rate unchanged at 6.5 per cent.
Alloting more funds for MNREGA and PM-KISAN could wipe out the entire additional money that the Centre may have for FY25.
The pharmaceuticals sector is expected to post a revenue growth of around 13.5 per cent and a net profit growth of 30.3 per cent for the third quarter of 2023-24 (FY24), riding on the approval for niche drugs in the US market, fall in raw material prices and correction in shipping rates. In the healthcare segment, hospitals are expected to post revenue growth of 13 per cent during the coverage, while net profit growth would be around 37 per cent, ICICI Securities said in a note. However, the performance may not be comparable on a sequential basis due to the offset of the festive season in Q3FY24, the analysts noted.
The stock of United Spirits, the country's largest liquor company by market capitalisation (mcap), has gained 11 per cent over the past week on double-digit growth guidance, rising premiumisation trend, operationally in-line performance in the March (Q4FY24) quarter and a rally in consumer stocks. The revenue growth of the company came in at 7 per cent year-on-year (Y-o-Y) mirroring the growth of the prestige and above (P&A) segment. This segment comprising premium brands accounts for 88 per cent of the revenues.
The June quarter is usually considered as a seasonally strong period for the IT sector.
Shares of Mukesh Ambani-owned Reliance Industries Limited (RIL) rose nearly 1 per cent on Tuesday, hitting an intraday high of Rs 2,986.05 per share, after most brokerages reacted positively to the company's March quarter (Q4FY24) results. The bullish outlook stems from Reliance Jio's potential tariff hikes, given the competitive landscape, along with slow but steady improvement in the oil-to-chemical (O2C) vertical.
NMDC reported a strong standalone revenue at Rs 5,410 crore, rising 45 per cent year-on-year (Y-o-Y) and 35 per cent quarter-on-quarter (Q-o-q) in line with consensus. Iron ore sales at about 11.4 million tonnes (MT) grew 18.9 per cent Y-o-Y (19 per cent Q-o-Q). Realisation stood at Rs 4,679 per tonne, higher by 22 per cent Y-o-Y (12.9 per cent Q-o-Q).
Public sector banks (PSBs) have delivered significant outperformance over the past three years and the sector has been re-rated. Given the growth and profitability expectations of an 18 per cent return on equity (RoE) over FY24-26, there is still a case for buying at the current levels. While the net interest margins or NIMs may remain range-bound or have a downward bias, there's optimism about possibly better opex ratios and lower non-performing assets (NPAs), plus scope for further credit cost reduction, and healthy treasury performances as interest rates trend down.
India's economic growth slowed to a 15-month low of 6.7 per cent in April-June 2024-25, mainly due to poor performance of the agriculture and services sectors, government data showed on Friday. The gross domestic product (GDP) expanded by 8.2 per cent in the April-June quarter of 2022-23. India, however, remained the fastest-growing major economy, as China posted a 4.7 per cent growth in April-June 2024.
The FMCG industry hopes for a revival in consumption growth in 2025 with some 'green shoots' already visible, after having a challenging year amid escalating input costs and a double-digit rise in food inflation, which ultimately slowed down the pace of the urban market growth in the second half of 2024. Soaring prices of commodities such as palm oil, coffee, cocoa and wheat forced FMCG players to go for a hike of 3 to 5 per cent or resort to shrinkflation by reducing pack sizes and grammage to retain attractive price points, fearing a volume loss.
India is not "rethinking" supporting investments from China, said Commerce and Industry Minister Piyush Goyal on Tuesday, referring to a proposal made in the Economic Survey 2024. The survey by India's chief economic advisor last week said India had two "choices" to benefit from the so-called China plus one strategy, either by integrating into that country's supply chain or by promoting foreign direct investment (FDI). "Chief economic advisor's report speaks about new ideas and gives out their own thinking. It is not at all binding on the government and there is no rethinking to support Chinese investments in the country," Goyal told reporters in Delhi.
Even as the slowdown in the information technology (IT) services sector deepens, banking, financial services and insurance (BFSI), as well as oil and gas companies, emerge as the primary drivers of corporate earnings in the country. The IT services sector's share in corporate earnings declined to a five-year low of 17.4 per cent in the second quarter (Q2) of 2023-24 (FY24), whereas banks and finance companies accounted for 46.5 per cent, and oil and gas firms contributed 16.8 per cent. At their peak, IT services firms like Tata Consultancy Services (TCS), Infosys, HCLTech, and Wipro represented just over a third of the combined net profit of all listed companies in the Business Standard sample.
Bengaluru-headquartered electric two-wheeler manufacturer Ather Energy is all set to file its draft red herring prospectus within the second week of September to the Securities Exchange Board of India (Sebi) for its maiden initial public offering (IPO), in which it is expected to raise over $450 million. On Tuesday, the fourth-largest electric two-wheeler maker in the country by volume raised Rs 600 crore from its existing investor, the National Investment and Infrastructure Fund (NIIF), catapulting itself into a unicorn with a valuation of $1.3 billion.
Concerns have been raised over Marico's exposure to Bangladesh in the wake of turmoil in that country. However, the management reiterated expectations of growing domestic business at double digits and maintaining international growth. Marico scaled up its food business by 4 times between FY20-24 and aims to double it again in the next three financial years.
The management of Tata Communications presented its product-to-platform strategy and explained how it hopes to grow its new products and portfolios, and geographies. The management targets doubling of data revenue by FY27 to ~28,000 crore (implied 18 per cent annual revenue growth). The DPS (Digital Platform & Services) segment is likely to contribute over 60 per cent of data revenue.
The "asset-right" strategy, reiterated by ITC chairman Sanjiv Puri during the company's 112th annual general meeting (AGM) on August 11, received a thumbs up from the analysts. They, however, believe that sustained earnings growth and synergies with the demerged hotel's vertical will help the stock break out from the ongoing consolidation. "The stock is expected to consolidate between Rs 420 and Rs 450 in the near future.
rediffGURU Anil Rego answers readers' personal income tax queries.
PVR-Inox is in an inherently fickle business. If there is a string of flops, the box office collections will be weak. Conversely, Q2FY24, which witnessed several hits, has brought about an upside in revenues. However, the merger has led to market share gains and synergies that helped bring breakeven down to approximately 20 per cent occupancy.
Tata Consultancy Services (TCS) on Friday reported a 9 per cent growth in net profit at Rs 12,434 crore in January-March quarter of FY24, helped by improved margin and strong performance of its India business. The largest software services exporter had reported a post tax profit of Rs 11,392 crore in the same period of the preceding fiscal. In the entire FY24, the company's net profit surged 9 per cent to Rs 45,908 crore, while the revenue rose to Rs 2,40,893 crore from Rs 2,25,458 crore registered in FY23.
Public sector banks (PSBs) posted 16.1 per cent year-on-year (Y-o-Y) growth in net profit at Rs 39,974 crore during the June 2024 quarter. While net interest income (NII) showed subdued growth of 7.1 per cent, provisions and contingencies declined by 10.5 per cent Y-o-Y. This aided the bottom line to show steady growth.
India's economy is likely to grow by 6.5 per cent in the current and the next financial year, an EY report said, attributing lower than anticipated expansion in the September quarter to fall in private consumption expenditure and gross fixed capital formation. Real GDP growth eased to a seven-quarter low of 5.4 per cent in July-September -- the second quarter of the current 2024-25 fiscal year.
Strong performance by its US subsidiary Novelis and better returns in the copper business helped Hindalco Industries post consolidated revenue growth of 2 per cent quarter-on-quarter (Q-o-Q) to Rs 54,100 crore in the July-September quarter of 2023-23 (Q2FY24). Novelis' Flat Rolled Products (FRP) volumes grew 6 per cent Q-o-Q to 933,000 tonnes (down 5.2 per cent Y-o-Y) on better North American and European volumes. The consolidated earnings before interest, taxes, depreciation, and amortization (EBITDA) declined 2 per cent Q-o-Q to Rs 5,610 crore despite lower input costs in India and better Novelis performance.
Although the third quarter of financial year (2023-2024) FY24 (Q3FY24) was marginally below expectations, Info Edge (India) is witnessing strong investment trends and hitting new highs. The big driver is optimism about a pickup in the jobs market, which benefits Naukri.com and could mean upgrades in Q4FY24 expectations. The JobSpeak Index, which Naukri.com releases on a monthly basis, is showing a "transformative shift".
Analysts and economists have hailed the fiscal projections in the interim Budget, saying the lower fiscal deficit forecast shows that the government, even in an election year, is serious about fiscal consolidation and that the numbers look achievable. According to Devendra Kumar Pant, the chief economist at India Ratings, the two broad themes of the interim Budget are fiscal consolidation and stepping up focus on agriculture/rural to course correct, to some extent, the differential benefits of the ongoing economic growth that's tilted in favour of upper-income bracket/urban households. The projected fiscal deficit numbers for FY24 and FY25 suggest that the government is serious about achieving the fiscal consolidation path of 4.5 per cent fiscal deficit by FY26, and given the nominal GDP growth assumption and revenue buoyancy, the target appears plausible, Pant said in a note.
ICICI Bank on Saturday said its March quarter consolidated net profit grew 18.5 per cent to Rs 11,672 crore, helped by lower provisions. On a standalone basis, the second largest private sector lender showed a 17.4 per cent growth in its profit after tax at Rs 10,708 crore for the reporting quarter against Rs 9,122 crore in the year-ago period. For fiscal 2023-24, its standalone net profit grew to Rs 40,888 crore from Rs 31,896 crore a year ago.
The country's largest car maker Maruti Suzuki India on Friday reported a 47.8 per cent rise in net profit for the March quarter of FY24 to Rs 3,877.8 crore, on account of higher sales volume and favourable commodity prices.
Haryana has done well in terms of economic growth over the last couple of decades. For it to continue to lead the growth ladder, the new government has to work hard on multiple dimensions, recommend Shishir Gupta and Rishita Sachdeva.
India's third largest IT company HCL Technologies on Friday reported a flat year-on-year growth in net profit in the March quarter at Rs 3,986 crore. However, the company posted an 8.4 per cent decline in net profit on a sequential basis, amid rising employee cost and tightening IT spends around the world. The company described the performance as "decent" in view of the global macroeconomic conditions.
Shareholders of industry giants Adani Enterprises, Reliance Industries, and Tata Motors - the latter two are part of the Sensex - will decide on combined related-party transactions of more than Rs 2.68 trillion proposed for this financial year and later. Related-party transactions for BSE 500 companies touched at least a six-year high of Rs 42.1 trillion in FY23, the Capitaline data shows. The Rs 42.1 trillion includes related-party transactions both at balance-sheet and profit-and-loss levels.
It is similar to top-up health insurance plan, but provides for one or more claims cumulatively crossing the threshold limit.
After subdued earnings in the first half amid global headwinds, India Inc is taking a cautious approach on their capital expenditure (capex) for the second half of the financial year ending March 2025, according to management commentary. Minutes from the October monetary policy meeting show the Reserve Bank of India's (RBI's) optimism about private investments picking up.
The market could not make a clear assessment of Tech Mahindra with the stock swinging wildly in the last two sessions. The results on Thursday were expected to be weak but the stock dropped slightly. However, investors reviewed the three-year turnaround plan and decided the stock had been oversold and the price recovered 7.5 per cent.
The hospitality industry has seen plenty of interest since the catastrophic impact of the pandemic, which led to losses in FY21. The hotel industry market cap has more than tripled since 2019 on the combination of a strong earnings rebound and positive surprises, as well as three recent listings. The industry has good tailwinds. The anticipation is, demand for rooms will outrun supply for a few years despite capacity expansions.
There could be near-term margin pressures for lifestyle accessories major Titan Company. Even as the company maintains its growth outlook over the medium term, it has revised its margin guidance for the jewellery segment downwards. The company has adjusted its medium-term margin guidance to 12 per cent from the previous range of 12-13 per cent.
Traction for its specialty portfolio, a strong showing in the domestic market, and better regulatory compliance are positives for the country's largest pharmaceutical (pharma) company, Sun Pharmaceutical Industries. Given the triggers, some brokerages have increased their earnings per share estimates and target price for 2024-25 (FY25). This should sustain the momentum for the stock, which has been one of the major pharma gainers in 2023-24 (FY24), rising 57 per cent. It is currently trading at Rs 1,547 per share.
Most analysts have downgraded the stock of SBI Cards and Payments (SBI Card) as the credit card issuer posted weak results during the December quarter (Q3) of financial year 2023-24 (FY24). The sub-par show, analysts said, was for the eighth straight quarter. With this, they have slashed their earnings estimates by as much as 20 per cent over FY24-26 amid near-term pressure points in the company's growth outlook.
Will it be Noel Tata, Ratan Tata's half brother?
IT service company Wipro on Friday reported 7.8 per cent year-on-year decline in its consolidated net profit for the March quarter to about Rs 2834.6 crore, and cautioned that the macroeconomic environment remains "uncertain". The Bengaluru-headquartered company, which recently saw a change of guard with Srinivas Pallia taking over at the helm as the new chief executive officer, has given an IT Services revenue growth guidance in the (-)1.5 per cent to +0.5 per cent band for June quarter on a constant currency basis.
The battle for the top spot in the two-wheeler market is intensifying. The gap between Hero MotoCorp and Honda Motorcycle & Scooter India (HMSI) in retail sales narrowed to just 45,607 units in June. This improvement comes as HMSI has clawed back market share after dipping to a historic low of 18 per cent in May 2023. Now, the retail market shares of the two companies are 28.86 per cent and 25.54 per cent, respectively, compared to 35.54 per cent and 18.05 per cent in May 2023.
Growing concerns over slower-than-expected margin recovery, amid weak deposit growth have caught HDFC Bank's investors off guard. HDFC Bank's stock on Wednesday plunged nearly 9 per cent to hit an intraday low of Rs 1,527 on the BSE after reporting weaker-than-expected earnings in the third quarter (October - December) of the current financial year (Q3FY24). The shares of India's biggest private lender closed at Rs 1,536.9, down 8.46 per cent.
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