Stocks of public sector undertakings (PSUs) have been on fire in the past year as investors cheered an improvement in key operating metrics and embraced counters of these state-owned enterprises, analysts suggest. The S&P BSE PSU Index has gained over 90 per cent in the past year, rising much higher than the S&P BSE Sensex, which has rose nearly 19 per cent during this period, according to ACE Equity data. The BSE PSU Index, reports show, has delivered a compound annual growth rate (CAGR) of 28 per cent (including dividends reinvestments) over five years and risen by almost 60 per cent in the past year.
The government has tweaked the income tax laws to make it easier for the new owners of loss-making public sector undertakings (PSUs) to carry forward the accumulated losses and set them off against future profits. This will result in significant tax savings for the new owners if they are able to turnaround operations of the ailing PSU within a few years. This will, in turn, boost the post-tax earnings and returns for the new owners.
Most analysts expect growth in the sales of Nifty-50 companies to decelerate, albeit marginally, in the quarter ended December compared to the corresponding period of 2013-14, with metals and real estate companies pulling down earnings.
'The correction could take two to three months and traders need to be careful.' 'For investors, this could be a good time to nibble in.'
Markets ended in green on rate cut hope.
'I have no problems with the finance ministry or with state governments treating petrol pump prices as the last resort for meeting their ambitious spending targets with very limited revenue resources.' 'But let's do away with this smokescreen of free pricing of petrol and diesel and go back to administered pricing regime,' says Dr Sudhir Bisht.
'We aren't so unreasonable as to demand that he should have fully reversed Indira Gandhi's worst economic legacy, bank nationalisation.' 'But he could have made a beginning by selling off the two most stressed small public sector banks, and then announced that each year for the next 10, one government bank with the most messed-up balance sheet will be sold.' 'It would have electrified the markets, shocked his other banks into better behaviour, and marked his name among the great reformers,' argues Shekhar Gupta.
Diesel makes up nearly half of fuel demand in Asia's No 3 economy.
It may be the season for corporate matchmaking but India Inc's record of managing partnerships is far from impressive, says Shailesh Dobhal.
Analysts are enthused by BPCL's upstream foray and have re-rated the stock in the past couple of years.
Low fuel prices to help oil marketing and refining sectors but upstream players will stay under pressure.
Sun Pharma was by far the biggest gainer in the Sensex pack, surging 8.13 per cent, followed by Dr Reddy's at 4.92 per cent.
'If Indians are as smart as their counterparts in university, and have equal opportunity, then what is the reason that we cannot produce inventions of quality that are recognised by the world?'
Brokers said a flurry of buying by investors in blue-chips mainly influenced the sentiment.
The government shouldn't hide behind the veil of making a domestic giant out of the HPC-ONGC deal, rather it should just say it needs cash from this divestment exercise, says Sudhir Bisht.
Though the NDA government had been trying to privatise 20 companies, a decision for which was taken in 2017, and included national carrier Air India, the investor community evinced little enthusiasm for any of them. Now, with an in-principle approval for privatisation of BPCL, CCI and SCI, the government has taken the plunge again.
The fall in international oil prices had resulted in six consecutive reduction in petrol prices since August and two in diesel in the last one month and there was possibility of another round of cuts this weekend.
The National Democratic Alliance government is weeding out independent directors on the boards of public-sector undertakings (PSUs).
Oil firms' borrowings could fall by up to Rs 15,000 cr, govt's subsidy bill by 12% .
Markets extended losses to end 1.5% down on Tuesday, amid weak global cues, after investors turned cautious ahead of key economic data and booked profits in rate sensitive shares while the further fall in the rupee continued to weigh on investor sent.
Ajit Mishra, vice president, Research, Religare Broking, answers your queries.
The Union government will gain close to Rs 1.6 lakh crore in additional revenues this fiscal from a record hike in excise duty on petrol and diesel that has pushed the total incidence of taxation on auto fuels to 70 per cent of the price. Late on Tuesday evening, the government hiked excise duty on petrol by Rs 10 per litre and that on diesel by Rs 13 a litre to mop up gains arising from international oil prices falling to a two-decade low.
'We began foolishly bragging about Saudi-Emirati investment plans as indicative of the sheikhs 'distancing' from Pakistan, including on Kashmir,' notes Ambassador M K Bhadrakumar.
To prevent rise in air pollution levels, oil marketing companies and thermal power units were planning to procure stubble from farmers to make bioethanol and promote the central government's 'Agricultural Mechanization' for crop residue management. But both have seen minimal success.
The Shiv Sena has spurned Congress' request to participate in the bandh.
These stocks offer the best combination of maximum 'buy' recommendations from brokerages and share price upside over the next 12 months.
Sensex hit a record high of 27,225.85 and Nifty hit a record high of 8,141.90 in the intra-day trades today.
Rising oil prices and diminishing cash pile to limit capacity in 2018-19
The Tata group companies are now more valuable than all the listed central public sector undertakings (CPSUs) or companies in the country. The key 20 listed Tata companies ended the 2021 calendar year with a combined market capitalisation of Rs 23.36 trillion, ahead of the 70 listed CPSUs, which had a combined m-cap of Rs 23.2 trillion. In comparison, these CPSUs had a combined market capitalisation of Rs 16.7 trillion at the end of December 2020 against the Tata group firms' combined m-cap of Rs 15.7 trillion.
Automobile company Tata Motors, metals and mining major Vedanta, oil marketing firm Bharat Petroleum Corporation (BPCL), private sector IndusInd Bank, and two-wheeler major Bajaj Auto have witnessed their market cap slip below the Rs 1-trillion mark this year.
Out of nearly 30 public sector undertakings and assets under 'strategic sale' plan, only the ONGC-HPCL plan has been completed
'BPCL has always been spoken about as a multinational company though it is State-run... this sets our work culture also apart.'
The national budget 2019-20 had an outlay of Rs 10,000 crore for Phase-II of the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles scheme to boost electric mobility and increase the number of EVs in commercial fleets.
IDS-2 and raids to uncover black money stash keep receipts flowing
The uptick in prices ranging from steel to wheat could benefit lots of commodity-based companies -- from State-owned SAIL to the agro exporters.
Changing tracks helps. But, not taking the beaten path isn't always helpful. This is the story of two of India's biggest privatisations - Air India and Bharat Petroleum (BPCL). Nearly two decades after the last privatisation, a landmark divestment concluded this year when the loss-making national carrier Air India was sold to the Tatas.
The sharp fall in oil price is positive for oil marketers as subsidy concerns reduce further.
These have been selected based on the earnings growth prospects and favourable (buy) ratings by brokerages
The department of investment and public asset management is scouting for investment bankers and legal advisors to carry forward the transactions.
The progress of the GST Bill in Parliament is also likely to remain in focus
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