Business News

AirAsia India assures travel agents about its financial sustainability, expansion plans

Business News - 29 min 19 sec ago
New Delhi: Budget airline AirAsia India has assured travel agents about its financial sustainability and plans to expand capacity, according to a communication. The move also comes amid concerns about the airline after Malaysia's AirAsia Group Berhad earlier this month said it was reviewing its investment in AirAsia India. The airline -- a joint venture between AirAsia Investment Ltd and Tata Sons -- has been facing business headwinds. The carrier has assured the Travel Agents Association of India (TAAI) about its financial sustainability and growth momentum. AirAsia India's CCO Ankur Garg, Chief of Sales Ajay Kumar Wadhawan and other team members during a virtual meeting with TAAI assured them about the "stability of the airline" as well as provided insight on its expansion and upcoming schedules, as per the communication from TAAI. The airline has told the association that it continues to grow its network in line with capacity guidance prescribed by the government. Already the carrier is at 55 per cent of pre-COVID-19 capacity and is looking to increase the same to 70 per cent, according to the communication. In the current backdrop where the coronavirus pandemic has adversely impacted aviation sector, TAAI has also written to the Ministry of Civil Aviation (MoCA) to monitor all airlines. "It is very important to constantly stay in communication with airlines to stay abreast of situations. We believe many airlines are struggling to survive due to coronavirus. We just can't afford another Jet Airways/ Kingfisher. We have also written to MoCA to monitor all airlines," TAAI President Jyoti Mayal told . On November 17, Malaysia's AirAsia Group Berhad said it was reviewing its investment in low-cost carrier AirAsia India, which has been "draining cash" and causing much financial stress. "Our businesses in Japan and India have been draining cash, causing the Group much financial stress. Cost containment and reducing cash burns remain key priorities evident by the recent closure of AirAsia Japan and an ongoing review of our investment in AirAsia India," President (Airlines) of AirAsia Group, Bo Lingam had said.
Categories: Business News

Covid effect: Fat packages may not land in IIT campuses this year

Business News - 29 min 19 sec ago
New Delhi | Kolkata: Crore-plus pay packages are likely to take a hit at Indian Institutes of Technology (IITs) placements this year, as last year’s three top paymasters — Microsoft, Uber and Salesforce — have yet to confirm offering US roles due to the pandemic.The final placements for the top old IITs will start next Tuesday. For the first time, the entire process will be held virtually.Placement sources at six old IITs — Kharagpur, Kanpur, Roorkee, Madras, Bombay and BHU — told ET that these companies had not yet confirmed hiring for US roles and were as of now visiting for domestic roles. They may hire and train IIT grads in India now and move them later abroad once the Covid-19 situation improves. But California-based IT company Cohesity is likely to offer US roles, some of them said.79434866Microsoft, Cohesity and Salesforce did not respond to ET’s emails seeking comment till press time Thursday. “We will consider international offers depending on how the Covid-19 situation evolves and impacts mobility (travel/relocation),” said an Uber spokesperson in an emailed response. “This year, due to the pandemic, there is a likelihood of a drastic reduction in international offers,” said Anil Kumar Agrawal, training & placement officer, IIT-(BHU) Varanasi.At IIT-Kharagpur, a placement team member said Microsoft, Uber and BNY Mellon would not be hiring for US roles as of now but would be visiting for India profiles. Brewery giant AB InBev would be looking to fill a global role.Last year, Microsoft, Uber and Salesforce along with Cohesity, had visited the IITs for US roles. Among all the roles offered at the IITs, the US roles attract the highest pay packages, and getting fewer of them would heavily impact the number of crore-plus offers. Most students receive international offers in the first week of the placement season.Placement officials at other older IITs also did not rule out the possibility of the companies selecting some students to be moved to the US later, when the Covid-19 situation improves. “We are hopeful of getting companies for US roles this placement season. Though, as of now we have only a few firms that have confirmed for international locations,” said a student at IIT-Roorkee’s placement cell. The list of companies likely to make international offers this year at IIT-Madras include Cohesity, Accenture Japan, Taiwan Semiconductor Company and Dynamic Technology Lab, according to CS Shankar Ram, adviser (training and placement). At IIT-Guwahati, companies like Alphonso, SOU Japan, Accenture Japan, TSMC and Hilabs are likely to make international offers, said head of the Centre for Career Development Abhishek Kumar.
Categories: Business News

AstraZeneca may run more test: CEO

Business News - November 26, 2020 - 11:38pm
By Suzi Ring and James PatonAstraZeneca Plc is likely to conduct an additional global trial to assess the efficacy of its Covid-19 vaccine, according to the company’s chief executive officer, after current studies raised questions over its level of protection.The new trial would be run instead of adding an arm to an ongoing U.S. trial and would evaluate a lower dosage that performed better than a full amount in Astra’s studies. The company’s acknowledgment that the lower level was given in error fueled concerns.“Now that we’ve found what looks like a better efficacy we have to validate this, so we need to do an additional study,” CEO Pascal Soriot said in his first interview since the data were released. It will probably be another “international study, but this one could be faster because we know the efficacy is high so we need a smaller number of patients.”Soriot said he didn’t expect the additional trial to hold up regulatory approvals in the U.K. and European Union. Clearance from the U.S. Food and Drug Administration may take longer because the regulator is unlikely to approve the vaccine on the basis of studies conducted elsewhere, especially given the questions over the results, he said. Authorization in some countries is still expected before the end of the year, he said.“The question for us was, will we need the U.S. data to get approval in the U.S. or can we get approval in the U.S. with international data, and it was never clear,” said Soriot, who is in quarantine after arriving in Australia. “Now with those results it’s more likely that we will need the U.S. data.”Astra and its CEO are facing scrutiny as the drugmaker responds to growing confusion over the vaccine. The company’s late-stage data initially increased confidence that the world would soon have multiple shots to combat the pathogen, following positive reports from front-runners Pfizer Inc. and Moderna Inc. But scant disclosures and the manufacturing discrepancy have sparked doubts among scientists and investors.Different RatesAstra and its partner, the University of Oxford, reported Monday that a lower initial dose of the vaccine, followed by a full dose, produced a 90% efficacy rate in a smaller set of participants, compared with 62% for two full doses.A day after the data were unveiled the head of the U.S. vaccine program known as Operation Warp Speed said that the regimen showing the higher level of effectiveness was tested in a younger population. He also said that the half-dose was given to some people because of an error in the quantity of vaccine put into some vials. None of those details were disclosed in Astra or Oxford’s original statements.Soriot disputed the idea that the half-dose regimen was an error, saying that after researchers realized the dosing error they formally changed the trial protocol with the blessing of regulators.“I won’t tell you we expected the efficacy to be higher,” said Soriot. “People call it a mistake -- it’s not a mistake.”Astra shares fell 0.7% in London.The company has previously said it was considering adding a new arm to its U.S. trial to test the lower dosage.Journal PublicationAstra and researchers have declined to provide more data ahead of a peer-reviewed analysis that is expected to be published in the coming weeks. Results have been submitted to an undisclosed journal, Astra said in a statement.Astra’s is one of three vaccines that could be approved before the end of the year. Pfizer and Moderna, which have both created vaccines using messenger RNA, published data earlier this month that showed their vaccines were about 95% effective, and Pfizer has applied to U.S. regulators for emergency approval.There’s added pressure on the Astra shot to succeed because it’s easier to store and the company is selling it at cost during the pandemic, which means many low- and middle-income countries are relying on it.
Categories: Business News

Farmers protest: Air India offers free rescheduling of flights for affected passengers

Business News - November 26, 2020 - 11:38pm
New Delhi: Air India has said passengers affected due to traffic disruption on Thursday amid closure of the borders of the national capital region (NCR) will be allowed to reschedule their flights for free. People coming to the national capital from Haryana and Uttar Pradesh faced traffic snarls at several border crossings as the Delhi Police intensified vehicle checking in view of the 'Delhi Chalo' march by farmers from Punjab against the Centre's farm laws. "In view of traffic disruption in NCR region due to closure of Delhi borders, we are allowing no-show waiver & one free reschedule to passengers who couldn't report for their flights," Air India said on Twitter. "Waiver will be valid for flights scheduled out of Delhi airport only for 26th Nov '20," it added. Senior police officials said heavy deployment was made on the Faridabad, Singhu and Gurgaon border crossings with Haryana and vehicle checking was intensified as a precautionary measure in view of the protest march. Farmers from Punjab were scheduled to reach Delhi through five highways connecting the city as part of their march.
Categories: Business News

BharatPe eyes $5 billion annualised transaction value from PoS biz in FY21

Business News - November 26, 2020 - 11:38pm
New Delhi: Financial technology major BharatPe on Thursday said it has grown to USD 2 billion (Rs 14,766 crore) in annualised transaction value in just three months after the launch, and aims to further increase this to USD 5 billion (about Rs 36,916 crore) by the end of the fiscal. The point of sale (PoS) business now contributes to 25 per cent of the annualised transaction value, according to a statement. Currently, the company offers this product in 10 cities of the country and plans to ramp it up to 40 cities by the end of the current financial year, it said. It has set a target of USD 5 billion in annualised transaction value from the PoS business by the end of FY21, BharatPe added. BharatSwipe, the PoS machine from BharatPe, was launched in the second half of 2020. It is a first zero rental card machine that offers the merchants the option for zero transaction charges, and allows the merchants to accept payments from a range of credit and debit cards. "In just about a quarter, our PoS business is now one-fourth of our annualised transaction value...our average daily active merchants on PoS are much higher than the industry average. "We will be aggressively focusing on building this business as we expand to newer markets," BharatPe Group President Suhail Sameer said. He added that BharatPe currently has close to 35,000 machines in the market and is targeting deployment of about one lakh POS machines by the end of the current fiscal. "Also, we have recently launched cash advance loans based on the merchant's PoS transaction data and initial data looks very promising. We will be scaling this up in the coming months," he said.
Categories: Business News

Lakshmi Vilas Bank writes down tier 2 bonds worth Rs 320 crore

Business News - November 26, 2020 - 11:38pm
Kolkata: A majority of bond holders of Lakshmi Vilas Bank have lost the value of their investment as the bank has written down Basel III-compliant tier 2 bonds worth Rs 320 crore under Reserve Bank of India direction.The development took place Thursday, a day before LBV's amalgamation with DBS Bank India, even as promoters and shareholders of the old generation lender moved Bombay High against the decision of extinguishing their equity investment.The banking regulator has told LVB administrator that the process of writing down has to be completed before the scheme of amalgamation with DBS Bank India. ET has seen a copy of the note.“If the relevant authorities decide to reconstitute the bank or amalgamate the bank with any other bank under Section 45 of the Banking Regulation Act, 1949, such a bank shall be deemed as non-viable or approaching non-viability and both the pre-specified trigger and the trigger at the point of non-viability for write down of the bonds shall be activated,” RBI said in the note.Under the guidelines, Basel III-compliant, additional tier-1 (AT-1) and tier-2 instruments absorb losses through conversion into common equity and can be written down, experts said. The bank doesn’t have any AT-1 instruments. Out of Rs 368.70 crore of tier 2 bonds, paper worth Rs 318.20 crore is liable to be written off, they said.
Categories: Business News

Google India FY20 revenue rises 35 pc

Business News - November 26, 2020 - 8:37pm
NEW DELHI: Tech giant Google saw its India revenues grow 34.8 per cent to about Rs 5,593.8 crore in 2019-20 over the previous financial year, as per regulatory documents.Google India's total income was at Rs 4,147 crore in the financial year ended March 31, 2019, according to Registrar of Companies filing shared by market intelligence firm Tofler.The net profit was higher by about 23.9 per cent at Rs 586.2 crore in FY20 as compared to Rs 472.8 crore in the preceding fiscal, it added."The Board is glad to inform you that during the period beginning from April 1, 2019, and ending on March 31, 2020, the company has achieved a turnover (revenue from operations) of Rs 53,847 million, which is higher than the earlier year of Rs 39,928 million," the filing said.Google India's total expenses rose 30.4 per cent to Rs 4,455.5 crore in FY20 from Rs 3,416.5 crore in 2018-19.When contacted, a Google India spokesperson said: "In the FY19-20 financial year, Google India made a pre-tax profit of Rs 11,383 million, resulting in Rs 3,020 million of corporate income taxes payable, and invested almost Rs 4 billion in our Indian operations".Google India is engaged in the rendering of IT and IT-enabled services to its Group Companies engaged in the internet industry.The company is also a third-party reseller of advertising space of Google Adwords programme and other Google advertising products and services in India to advertisers seeking to market their products and services to consumers and business users over the internet.According to the filing, advertising revenue contributed about 27 per cent of the company's turnover, while the share of IT-enabled services stood at 32 per cent and that of IT services was at 41 per cent."From April 1, 2019, to March 31, 2020, the company made 4 CSR grants, totalling about Rs 13.34 crore to Non-governmental organisations working to improve the quality of education and safety of children," the filing said.These organisations have used the funds in improving the education system and for the safety of the children and to experiment with new technologies to enhance their work and create innovative new products to make work and teaching more accessible, it added.
Categories: Business News

Oil regulator PNGRB simplifies gas pipeline tariff

Business News - November 26, 2020 - 8:37pm
New Delhi: Oil regulator PNGRB has simplified the country's gas pipeline tariff structure to make the fuel more affordable for distant users and to attract investment for building gas infrastructure. The Petroleum and Natural Gas Regulatory Board (PNGRB) has notified regulations for a 'unified' tariff structure for over a dozen pipelines that form the National Gas Grid which will lead to a 20-30 per cent rise in transportation charges paid by users near the source but a reduction for consumers in the hinterland. "Unified tariff shall be determined by the Board in respect of the national gas grid system for each financial year before the start of such financial year," it said. Currently, the tariff is levied in proportion to the distance transported - the longer the distance, the higher is the charge. This resulted in consumers away from the coast paying higher charges as compared to those near it. PNGRB has now notified a two-zone tariff structure - Zone-1 will be 300-km from the source of gas (gas field or LNG import terminal) and Zone-II will be beyond that. PNGRB said the tariff for the first tariff zone will be 40 per cent of the tariff for the second zone. This, industry sources said, will lead to an immediate increase in tariff for user industries such as power plants and fertilizer units in Gujarat, which is the landfall for ONGC's offshore gas field as well as houses three gas import terminals. Consumers further away from the source, say in Uttar Pradesh or Bihar, will benefit as they will now pay a lesser tariff. "The tariff for zone-1 of Hazira-Vijaipur-Jagdishpur pipeline (India's main truck line from Gujarat to Uttar Pradesh via Madhya Pradesh) will rise from Rs 20 per million British thermal unit to Rs 26 per mmBtu," a source said. The increase will vary from pipeline to pipeline. "On average, the tariff for zone-1 customers will go up by 20-30 per cent," the source said. The pipelines that will be part of the unified tariff plan include state-owned gas utility GAIL India Ltd-operated Hazira-Vijaipur-Jagdishpur (HVJ) and its supplementary Dahej-Vijaipur line and Dahej (in Gujarat) to Uran-Dabhol-Panvel (in Maharashtra) pipeline. Also, the line from Jagdishpur in Uttar Pradesh to Haldia in West Bengal, Bokaro in Jharkhand and Dhamra in Odisha (called the Pradhan Mantri Urja Ganga) and Dadri (Uttar Pradesh) to Bawana-Nalga and Dabhol-Bangalore pipeline would be part of it. Reliance Industries' subsidiary operated Shahdol-Phulpur line from its CBM block in Madhya Pradesh to Uttar Pradesh as also its formerly owned East-East pipeline from Kakinada in Andhra Pradesh to Baruch in Gujarat would also be part of the plan. GSPL's proposed Mehsana in Gujarat to Bhatinda in Punjab and onwards to Jammu/Srinagar as well as Mallavaram-Bhopal-Bhilwara-Vijaipur lines would also be part of it. Indian Oil Corp's (IOC) Dadri-Panipat pipeline is also part of the unified structure. Sources said PNGRB will now notify unified tariffs for each of these pipelines. The new tariff structure would help create a single gas market in the country by attracting investment to complete the gas grid and make it more easily accessible. This is part of the government's plan to raise the share of gas in India's energy mix to 15 per cent by 2030 from the current level of about 6.3 per cent to cut its carbon footprint.
Categories: Business News

Realtors should avail last mile finances from Rs 25k cr stress fund: SBICAP

Business News - November 26, 2020 - 8:37pm
SBICAP Ventures Ltd, which is managing the Rs 25,000 crore stress fund for realty sector, has urged builders to apply for last mile funding to complete their projects and said that existing lenders might be "far more willing" now to issue necessary no objection certificates for seeking finances. In November last year, the Centre had announced a Rs 25,000-crore fund to help complete over 1,500 stalled housing projects comprising 4.58 lakh housing units across the country. Many real estate developers have been complaining that they are not able to get funds from the government-backed Special Window for Affordable and Mid-Income Housing (SWAMIH) as the existing lenders are not giving no objection certificates (NOCs) ceding charge on the properties. As per the rule, the SWAMIH fund requires an NOC for ceding senior charge from the existing lenders in the project. Addressing a virtual conference organised by NAREDCO, Irfan A Kazi, Chief Investment Officer, SWAMIH Investment Fund, SBICAP Ventures Ltd, said 36 proposals have been given final approval and 99 in-principle nods, for getting funds, benefitting around 90,000 homebuyers. Kazi asked builders, whose projects are stressed and not able to secure funding from normal banking and NBFCs routes, to apply for SWAMIH fund. He said the fund is not only for stalled housing projects but also for stressed ones that need last mile finances for completion. "Banks and NBFCs may be far more willing to cede charge," he said, if the financial institutions did not give NOCs earlier does not mean that they would reject even now. He said banks and NBFCs are most likely to cede charge. Kazi said the objective of this fund is to complete construction, even if there are no fresh sales bookings and sales collections from existing customers. He noted that sales collection from existing homebuyers and fresh sales have improved in those projects that have been approved to receive SWAMIH fund. "We get added credibility to project," Kazi said. Giving details about SWAMIH fund, he said the project management consultants give daily report about the progress of construction on the sites. Kazi said all the expenses are through bank transfer, cheques and drafts. Even petty cash expenses are being done through legitimate channel. The SWAMIH fund is also ensuring that projects comply with all regulations, he said. "SWAMIH INVESTMENT FUND I" is the name of this special Window and it is in the form of an alternative investment fund (AIF). The Centre is infusing Rs 10,000 crore into this stress fund, while the remaining being provided by state insurer LIC and the country's largest lender SBI. Only RERA-registered projects with positive net worth will be provided funds. The investment manager of the fund is SBICAP Ventures Ltd, an asset management company that is a wholly-owned subsidiary of SBI Capital Markets Ltd, which in turn is a wholly-owned subsidiary of the State Bank of India.
Categories: Business News

As vaccine hopes take centre stage, will value stocks regain favour among investors?

Business News - November 26, 2020 - 8:37pm
By Mark GilbertHopes that vaccines will soon replace economic lockdowns as our best defense against the coronavirus have stirred speculation that value stocks will regain favor among investors. A guy who until recently oversaw $1.6 trillion has a strong argument that growth stocks will continue to be a better investment.Hiro Mizuno was chief investment officer of Japan’s Government Pension Investment Fund for five years until the end of March. Now a Tesla Inc. board member and special adviser to Japan’s Ministry of Economy, Trade and Industry, here’s what he tweeted at the weekend:'(Growth vs Value) Value investing is to bet on other investors’ misjudgements, while growth investing is to bet on growth stories of company set by CEO. Very different mindsets. I personally like growth strategy where I could find visionary & disruptive companies,' tweeted Hiro Mizuno (@hiromichimizuno) on November 21, 2020Pitting the disruptive vision of entrepreneurs against the hopes of uncovering a real find amid the clutter of beaten down stocks provides a compelling way to frame the debate about whether growth stocks, classified as shares of companies with accelerating revenues, can keep outpacing value stocks, equities whose value is deemed not to reflect some measure of underlying worth.It seemed like the equation might be changing. Value stocks enjoyed a renaissance this month when vaccine euphoria prompted investors to rotate into shares trashed as the pandemic crimped the global economy. Their returns beat their growth counterparts by five percentage points in the first three weeks of November.That’s sparked talk of a global revival. On Tuesday, Bank of America Corp. strategist Savita Subramanian recommended U.S. financial and energy stocks as her top two “unapologetically cyclical and value-focused” sectors. Strategists at Barclays Plc, led by Emmanuel Cau, on Wednesday recommended investors in European shares should overweight value versus growth. And John Woods, Credit Suisse Group AG’s Asia Pacific CIO, said Asian value stocks will outperform in the next six months provided a vaccine becomes widely available.So could it finally be value stocks’ turn in the sun? Investment advisers who’ve called for a reversal of that trend have been proven wrong time and again.79429282In the chart above, the biggest stocks in the Bloomberg Value Index include investment bank JPMorgan Chase & Co., telecoms operator AT&T Inc. and energy company Exxon Mobil Corp. The growth index is dominated by the FAANGS: Facebook Inc., Amazon.com Inc., Apple Inc., Netflix Inc. and Google’s parent, Alphabet Inc.The picture doesn’t change no matter the time period. So far this year, growth stocks have gained about 24 per cent, while value stocks are down by 5 per cent. In the past 12 months, growth is up by 28 per cent, value down by 2.5 per cent. Over three years, growth delivers 66 per cent versus just 12 per cent for value. And since early 2007, when the index histories begin, growth is up more than fourfold while value has a bit more than doubled in value.But hope for value stocks seems to spring eternal. A net 24 per cent of investors overseeing $526 billion expect value to outperform growth the coming year, according to Bank of America’s November survey. That’s the most bullish call for value in the monthly poll since February 2019.Mizuno says that investment style fails to capture disruptors that sacrifice earnings early on to build a dominant market share. Jeff Bezos’s Amazon is probably the best example of that kind of company. “Growth investing for me is to bet on the ability of CEO and his/her staff to deliver more than people (including myself) can imagine,” Mizuno also tweeted.By contrast, trying to identify value stocks takes a cocky — and risky — self-assurance that the wisdom of the investing crowd has missed something fundamental about a company’s worth. If a share is cheap, it’s probably cheap for a reason.You could even stretch the argument to cover the recent enthusiasm for Bitcoin versus gold. As my colleague Lionel Laurent recently pointed out, the digital currency barely figures in buying and selling in the real world and yet its gains have rapidly outpaced the yellow metal this year.Gold has real-world applications that make it inherently valuable, but many investors still view it as nothing more than a pet rock, limiting the potential universe of buyers. To its fans, Bitcoin represents a transformative technology with the potential to dislodge fiat currencies as a means of payment. In effect, it’s a bet on the future of finance with a side wager that its momentum will continue apace — like a disruptive growth stock.79429292The current enthusiasm for value stocks may well have further scope to run. But in the longer term, the trend that’s been your friend seems likely to persist. Even once the pandemic is over, backing entrepreneurs will prove more profitable than buying allegedly undervalued equities in the hope that mean reversion will rescue them from the bargain basement.
Categories: Business News

Long-term investor says this market is not in the safe zone

Business News - November 26, 2020 - 8:37pm
NEW DELHI: With three experimental Covid-19 vaccines showing promising signs and the stock market hitting new record highs every other day, is the uncertainty behind us?Not yet, warns Shyamsunder Bhat, who is a long-term investor in domestic equities as the Chief Investment Officer of Exide Life Insurance. He says the launch of a vaccine will not solve the problem immediately for investors. “Not just the vaccine launch. The market will wait for a few months to see the efficacy of the vaccine before concluding if the uncertainty is behind us or not," Bhat said.Besides Russia's Sputnik V, vaccines being developed by Pfizer-BioNTech, Moderna, Pfizer and Oxford-AstraZeneca have reported over 90 per cent efficacy in preventing Covid-19. Pfizer and BioNTech hope to start delivering their vaccines in the market as early as next month after getting necessary regulatory approvals.But Bhat, a market veteran, says for Dalal Street for achieve stability, both Covid vaccine and the availability of liquidity would be important. “Central banks’ firepower may be somewhat limited compared with what we have seen in last six months. The central banks, going forward, are likely to have an accommodative stance, but compared with the kind of liquidity increase seen in last six months, the incremental rise is likely to be smaller from here on," he said.Like several others in the market, Bhat is worried about lofty valuations.“Considering the rally seen in domestic stocks over the past few months, valuations are already factoring in a strong FY22, and to some extent the FY23 numbers too are in the price in some cases," Bhatt said, adding that economic fundamentals need to improve for a sustainable rise in the market.Bhat said the sharp rise seen in midcaps and smallcaps has been due to retail participation. “We hope those who have entered the market in last six months have a longer-term outlook. Many of them may not have experienced such sharp correction in the market in the past,” Bhat said.So how should one pick stocks in such a market? Leave it to the experts, he suggests.“Ideally, retail investors should invest in professionally managed funds, be it mutual funds or insurance products, rather than risking a significant part of their investments by picking stocks on their own, or going with the market momentum. Unless they have the ability to do stock research themselves, they should not dive into stocks independently," he said.Pointing out how companies with higher growth have continued to command higher P/E multiples in the last few years, Bhat said value stocks have become cheaper and are yet to find favour.“However we could eventually see some allocation moving into value stocks, where growth may be nil or modest, but which are attractive in terms of valuations and where companies themselves do not have any balance sheet or corporate governance concerns,” he said.With the Indian economy still in a recession technically, investors who are uncomfortable with pricey valuations in the ongoing bull market have chosen to keep their powder dry and wait for the bubble to burst."It is difficult for anyone to time the market, because you have to time it right twice - while buying as well as while selling. Some retail investors might have got their entry time right by investing at the lows of March and April, but it is also important to exit at the right time if specific stocks or sectors exhibit bubble-like valuations,” he said.According to Bhat, the comfort level on Nifty is not really very high. “There is the possibility of a correction. Given the unpredictability of the market, the ideal strategy is to follow systematic investing by staggering your investments and buying through the ups and downs of the market,” he said.
Categories: Business News

Piaggio to soon start manufacturing Aprilia SXR 160 scooter at Baramati plant

Business News - November 26, 2020 - 5:36pm
Mumbai: Italian premium scooter maker Piaggio on Thursday said it will 'soon' commence the production of Aprilia SXR 160 scooter at its Baramati manufacturing facility in Maharashtra, ahead of its launch. Showcased at the Auto Expo in Greater Noida in February this year, the 160-cc BS-VI compliant premium scooter model is designed for the domestic market, and is expected to be launched in the country soon. "Piaggio India will soon commence the production of Aprilia SXR 160 at its Baramati plant, with the aim to launch the new premium scooter in the Indian market to serve its distinguished customers," the company said in a release. Designed in Italy for India, the SXR 160 is set to create a new benchmark as a trendsetter with its unique next-generation appeal and technologically advanced features, Piaggio India said. "We are extremely excited to soon introduce the highly anticipated and a unique, premium proposition for our discerning customers. As promised at the Auto Expo 2020, we are gearing up for the production of Aprilia SXR 160 in India and unfolding a new chapter for the scooter industry," Piaggio India Chairman and Managing Director Diego Graffi said. The scooter is equipped with a large 210 sq cm multi-functional all-digital cluster that hosts multiple features, the company said, adding that customers can opt for mobile connectivity accessory which connects user's mobile to the scooter and helps them in locating it, raising security alarm when needed, and if necessary, even immobilizing it. The SXR 160 comes with an anti-lock braking system (ABS) along with ventilated disk brakes and twin pots calliper hydraulic brakes. "With its highly innovative design, the SXR 160 is set to create a new unmatched experience of premium style, high comfort and best in class performance. To ensure that we bring this experience much closer to everyone, we are expanding our footprint of dealer network in India by welcoming the premium mindset entrepreneurs to our most exciting dealership business model in their town," Graffi added. Piaggio India currently has over 250 dealerships, and intends to expand to over 400 dealerships across India, the company said in the release. Aprilia SXR 160 incorporates Aprilia's latest global design language and once it hits the road, it will create a new category in the premium scooter market in India, the company said. Piaggio, which re-entered Indian market in 2012 with the launch of the iconic Vespa scooter, has a state-of-the-art plant in Baramati, where it manufactures Vespa alongside Aprilia SR range. Piaggio manufactures its commercial vehicles, including three-wheelers, at a separate facility in Baramati.
Categories: Business News

India wearables mkt sees 165 pc growth; shipments touch 11.8 mn units in Q3:IDC

Business News - November 26, 2020 - 5:36pm
NEW DELHI: The India wearables market - including products like smartwatches and earbuds - posted the highest quarterly shipment to date, growing 165.1 per cent to 11.8 million units in September quarter, as per research firm IDC.The wearables segment, which had clocked shipment of 4.4 million in the September 2019 quarter, saw strong demand for earwear devices and watches that propelled this growth, IDC said."In the last few quarters, wearable devices have become more affordable with the average selling price of watches coming down to USD 111 in Q3 2020 compared to USD 175 in Q3 2019. This is enticing consumers to upgrade from wristbands to watches," it added.Similarly, the average price of true wireless stereo (TWS) (commonly known as earbuds) has dropped by 48.6 per cent y-o-y in the third quarter of 2020 to USD 57.TWS now contributes to 39.7 per cent of the overall earwear category, as close to 4 million TWS devices were shipped during the quarter, recording 1,156.3 per cent growth in the quarter under review, as per IDC."The pandemic has created a new norm of learning and working from home. Virtual meetings, online classes, and increased time spent on entertainment have led to an intensified demand for earwear devices," IDC India Market Analyst, Client Devices, Anisha Dumbre said.Vendors are capitalising on this rising trend, addressing the growing consumer demand and launching affordable devices, making the overall earwear category more accessible, she added."The pandemic has reinforced the importance of fitness in our life. The motivation of staying fit and leading a healthy lifestyle is now forcing users to upgrade to more sophisticated wearable devices with greater expectations around improved health tracking," IDC India Associate Research Manager, Client Devices, Jaipal Singh said.Singh added that to support this shift, the watch category is also witnessing an adjustment in average selling price and expected to accelerate the much-needed migration to watches from wrist band.As per IDC, the wristbands segment saw a growth of 83.3 per cent quarter-over-quarter in the third quarter of 2020 after seeing a sequential decline in the first half of the year. However, it declined by 20.3 per cent y-o-y as users started upgrading to watches. Xiaomi maintained its lead, accounting for more than half of the category shipments with a 52.4 per cent share in the quarter, followed by Realme (14.6 per cent share), IDC said.The watches segment registered a growth of 119.9 per cent y-o-y in the quarter under review with 7,78,000 units shipped in the country, making it the biggest quarter since the launch of the category in India.Homegrown Indian lifestyle technology brand, Noise led the segment with a 28.5 per cent share in the quarter under review, while Realme replaced Huami for the second position with a 24.2 per cent share of the category, IDC noted.Increased demand for wireless devices supported the earwear category to hit its "all-time high" shipment in the country, witnessing a 260.5 per cent y-o-y growth in the third quarter of 2020. Boat led the category with a 32.4 per cent share, followed by Samsung (includes devices from Samsung, Infinity, Harman Kardon, and JBL) with 15 per cent share.Boat also led the overall TWS category with a 26.1 per cent share, followed by Realme (15.5 per cent).In a separate statement, Noise said it has recorded a sale of over one lakh smartwatches in a time span of 100 hours during the festive season, and it has aggressive expansion plans for the coming months.Noise co-founder Gaurav Khatri said the company plans to ramp up the portfolio and will soon bring more upgrades to its current successful models in the next one month.
Categories: Business News

Does Biden at White House offer an opportunity for India to get a win-win deal?

Business News - November 26, 2020 - 5:36pm
On November 4, 2020, the day after the US elections ended, the US Government released an official statement that said: “The US calls on Cote d’Ivoire’s leaders to show commitment to the democratic process and the rule of law. We urge all parties, groups and individuals to engage in inclusive dialogue to find peaceful solutions to their disagreements to heal national divisions. Grievances related to the presidential election should be resolved peacefully and transparently through legal processes.”One must reflect on whether this statement is more apt for leaders in the US that has just spent the last eighteen months in probably the most divisive and expensive election in US history.As the transition which should have by now begun and is unfortunately deliberately hijacked and delayed begins, there is renewed hope of a new administration that will focus more on critical issues that are a need of the hour domestically for Americans such as:Addressing the Covid crisis and an effective distribution strategy across the nation,Universal healthcare at an affordable cost,Increasing the minimum wage,Addressing domestic security issues that have led to deep divisions in the country and distrust with the law and finally,Focus on revitalising growth in the economy so that the record numbers of unemployed people can get back to gainful employment.While domestic issues will probably take the majority of the near term focus of the Biden Harris administration, there are other critical areas that need urgent attention such as signing the Paris Climate Accord to address Climate Change and a cohesive green energy policy for the US.Combine this with a revitalized foreign policy that will leverage on President Biden’s core long-term strengths of statesmanship for the US to rebuild its alliances with Nato, while re-establishing trust within the free world, contain the rising threats from Russia and China while establishing stronger, more deeper ties with India to bring a better balance of power in South Asia.One positive offshoot of the Trump administration has been the breakthrough and encouraging ties between the UAE and Israel and this may be a good possible option to explore further thus changing the old dynamics and embracing a new one.India has the opportunity and stands on the cusp of building a stronger more deeper and effective economic and security partnership through more cross border economic partnerships by opening its market while accessing that of the US for Indian businesses and being the de facto go to country for US businesses as they look at other options besides China from a security threat standpoint and business rivalry.Additionally, as Indians generate wealth and grow their economy, it is important that commerce and business between the two nations benefit both the US and India.India has a substantial trade deficit with the US and needs to open its market to more US businesses, thus allowing competition to thrive while at the same time maintaining safeguards to protect and grow domestic small and medium businesses.In many ways, India is at serious risk of moving more closer to an oligopoly similar to that in Russia, and it is, therefore, critical for the government to facilitate and encourage avenues for small and medium-sized businesses to access technology and innovation while using their strong competitive spirit to replace China in the US as a manufacturing hub thus encouraging more Investment from the US into India and vice versa.From a financial services industry standpoint, it would be wise to consider allowing Indian businesses to cross list to access global capital and facilitate regulations for Indians to build a more robust global asset allocation strategy that includes access to the best global businesses through fund investments will go a long way to a faster integration of India with the world economy while allowing Indians to benefit from the growth in the US.Overall, with the new political leadership in the US, it’s a very bright future ahead and an opportunity for India in almost every sector from manufacturing, agricultural and services. A fantastic opportunity to establish a holistic win-win relationship between the two countries that can benefit both immensely over the long term.
Categories: Business News

Listed companies post record 171% jump in Q2 profits

Business News - November 26, 2020 - 5:36pm
Operational efficiencies in the manufacturing and banking sector has led to 171% jump in net profits of 4,076 listed companies under consideration for the quarter ended September 30 at Rs 1,54,500 crore compared to Rs 57,000 crore in the same period last year. This is the highest profit made by all listed companies in any quarter and 30.9% higher than the earlier best record of Rs 1,18,100 crore in the March 2014 quarter for 4,854 listed companies, the Centre for Monitoring Indian Economy said. “The extraordinary increase in profits in September 2020 originate in the operational efficiencies of the manufacturing and banking sectors,” CMIE said in its weekly analysis. According to CMIE, both have seen a sharper fall in their operating costs compared to the fall in their topline. “Companies have made these extraordinary profits in the midst of a partial lockdown and a fall in sales compared to a year ago,” it added.CMIE analysis shows nearly half the profits made by listed companies in the September 2020 quarter came from manufacturing companies. Collectively, the 1,675 listed manufacturing companies in the sample made Rs 72,600 crore of net profits, accounting for 47% of the total PAT of the 4,076 companies. “These are the highest profits generated by the listed manufacturing companies. This is 16.7% higher than the Rs 62200 crore of PAT in the quarter of June 2018 and 15.2% higher than they were a year ago in the corresponding quarter.CMIE further said manufacturing companies made a killing in operating profits. “While their net sales shrunk by Rs 96,100 crore, operating expenses fell by Rs 1,33,100 crore. Most of the fall in operating expenses was because of lower spends on raw materials and finished goods which fell by Rs 1,19,500 crore,” it said. “Lower other income, lower net extraordinary income, higher provisioning and higher taxes contained the growth in profits obtained from operations. Yet, they made record profits,” it said.In the banking sector, the income from operations grew by 10.7% and other income by 10%. Their major expense head interest expenses grew marginally by 1.8% while expense on wages grew by 22.7%. “Banks therefore seem to have been a big beneficiary of sustained business and sharp fall in interest expenses,” it added.
Categories: Business News

International flight ban extended till Dec 31

Business News - November 26, 2020 - 2:36pm
The government today extended the ban on international flights further by a month till December 31, 2020. The Directorate General of Civil Aviation (DGCA) today announced ban on international flights will continue till the end of this year. The order, however, clarified that cargo flights and limited international flights under bubble arrangement will continue to operate. The DGCA order came after the home ministry did not allow international flights under unlockdown measures, where the government is slowly trying to reopen the country. Regular international flights, however, are among the few that have not been opened. This extension of ban is an indication that regular international flights would not begin so soon, as number of infections due to virus are rising across the globe. Due to rising number of infections, various countries are working to stop the spread of the virus through various means available, including partial lockdowns and may not want international flights to begin. India too is seeing a rise in number of infections and various states have gone into weekend lockdowns and night curfews to control the spread of virus. The central government, however, has clarified that states can not announce full lockdowns unless the centre approves so. India, in a move to reduce inconvenience to its people, have got into a bubble agreement to ensure flights with countries, where Indian diaspora has a significance presence. India also may not want to restart international flights immediately.
Categories: Business News

Proposal to allow business houses into banking a good-looking step in bad direction: Kaushik Basu

Business News - November 26, 2020 - 2:36pm
New Delhi: The RBI working group's proposal to allow corporate houses to set up banks is a 'good-looking' step in a 'bad direction' and may lead to crony capitalism and eventual financial instability, former chief economist of World Bank Kaushik Basu said on Thursday. Basu further said that there is a good reason why all successful economies have a clear dividing line between industries and corporations on the one hand, and banks and lending organizations on the other. "The proposal from the recently set up Internal Working Group of the Reserve Bank of India, allowing Indian corporate houses to own and run banks is a good-looking step in a bad direction," he told . Basu, who was also chief economic adviser during the UPA period, said at first sight, this may look good because the close connection between industrial corporations wanting to borrow and banks wanting to lend speeds up lending activities and makes the banking sector look more efficient. "But such connected lending is almost invariably a step towards crony capitalism, where a few big corporations capture the business space in the country, slowly edging out the smaller players. "Also, connected lending can lead to eventual financial instability," he argued. Last week, an Internal Working Group (IWG) set up by the Reserve Bank of India (RBI) made various recommendations, including that large corporates may be permitted to promote banks only after necessary amendments to the Banking Regulation Act. "There is a lot of evidence that connected lending was the biggest cause of the build-up of bad loans in 1997 in Asia, which resulted in the East Asian Crisis that began in Thailand and turned out to be one of the biggest financial crashes in the world," he pointed out. India's Banking Regulation Act, 1949, which was originally the Banking Companies Act, 1949 is a very well-crafted law, the eminent economist said adding it reflects the sophistication of the founders of modern India. Basu, however, noted that times have changed and there are reasons to amend some parts of it. "I think creating avenues for some Non-Banking Financial Companies (NBFCs), which are not controlled by industrial houses, into proper banks is worth considering seriously. "But the change in law that will allow industrial houses to own and run banks is a completely wrong move and a recipe for two possible outcomes -- crony capitalism and financial crash," he opined. Recently, former RBI Governor Raghuram Rajan and ex-Deputy Governor Viral Acharya in a joint article had said that the RBI working group's proposal to allow corporate houses to set up banks is a "bombshell" and at this juncture, it is more important to stick to the tried and tested limits on involvement of business houses in the banking sector.Untitled Carousel 79396230 79377256
Categories: Business News

Coronavirus Impact: Housing demand may decline 40% year-on-year in FY21, says India Ratings

Business News - November 26, 2020 - 2:36pm
MUMBAI: The overall residential demand is likely to decline around 40% from a year ago in 2020-21 (April-March), with the affordable segment being the worst hit, due to the higher-than-anticipated slowdown caused by the COVID-19 pandemic, said India Ratings & Research.Demand-side risks combined with a rising uncertainty over credit availability for the sector in the light of increasing risk aversion by financial institutions may add to the refinancing as well as liquidity risks for the sector, the ratings agency added.Market consolidation continued in the favour of grade I players. While sales have declined overall during the first half of 2020-21, grade-I residential developers witnessed a lower on-year decline in sales of 13%. Pre-sales for the top 10 listed players during the period stood at 12.3 million sq ft.However, the agency believes that the sales will be hampered until the ongoing COVID-19 situation stabilises, and thus cash flows for these players could also come under pressure, as is being shown by the 46% on-year decline in their operating profit during the first half of the financial year.Sales activity remained muted in the first quarter ended June and witnessed slow recovery in the quarter ending September, India Ratings said quoting data from Liases Foras Real Estate Rating & Research.The residential sector continues to under-perform as an asset class, impacting the investor demand. Hyderabad remains the only market which has shown a price compound annual growth rate (CAGR) in a high single digit, while the other markets have lagged behind with sub-par price CAGR of 1%-2% over the past five years. All cities, with the exception of Hyderabad and Bengaluru, have witnessed a slight decline of prices since March end, the data showed.According to India Ratings, disbursements from housing finance companies and wholesale non-banking financial companies (NBFCs) to the real estate sector had declined marginally on a sequential basis in the June quarter, but recovered in the September quarter. However, NBFCs’ assets under management towards real estate have been steadily on decline since March 2019, on the back of the asset sell-down exercises being conducted by most NBFCs.
Categories: Business News

Tesla's upcoming S&P 500 debut fuels 'crazy' trading volume

Business News - November 26, 2020 - 2:36pm
If you traded a stock in the past week, there's a fair chance it was Tesla. Shares in the electric car maker led by CEO Elon Musk rose almost 3% on Wednesday and have now surged 40% since Nov. 16, when it was announced Tesla would join the S&P 500 in December. Investors rushed to buy shares ahead of index funds that will be forced to acquire over $50 billion of its shares. One of Wall Street's most loved - and hated - stocks, Tesla was already the U.S. stock market's most traded companies by average daily value, but trading has surged in recent sessions, along with Tesla's stock price. "It's been crazy. Since Tesla's (announced) inclusion in the S&P, you've had a lot of managers out there that didn't own enough of it having to buy more," said Sahak Manuelian, managing director of trading at Wedbush Securities, in Los Angeles. Retail investors using apps like Robinhood are also responsible for much of the recent volume spike, Manuelian added. Traders bought and sold an average of nearly $26 billion of Tesla shares per session over the five days ending on Tuesday, accounting for almost 8% of all stock traded on U.S. exchanges, according to Refinitiv data. That is more than the combined value of trades in Amazon.com Inc and Apple Inc over the same period. At about halfway through Wednesday's session, traders had exchanged $20 billion worth of Tesla shares, according to Refinitiv. Up over 400% in 2020, Tesla has become by far the world's most valuable automaker, despite production that is a fraction of Toyota Motor Corp, Volkswagen or General Motors Co. Over the past year, Tesla has averaged over $16 billion a day in trades, followed by Apple, at about $14 billion, according to Refinitiv data. Trading in Chinese electric vehicle maker NIO Inc has also surged in recent weeks, with its shares nearly doubling in November. Including NIO, trading of stocks in the nascent electric vehicle industry reached an average of $38 billion a day in the past five sessions, accounting for 12% of all trading on U.S. exchanges. By comparison, traders in the same period bought and sold each day about $8 billion worth of oil and gas stocks including Exxon Mobil and Chevron.
Categories: Business News

COVID-19 vaccine: What you need to know

Business News - November 26, 2020 - 11:35am
With the coronavirus refusing to die down, despite multiple waves, lockdowns, social distancing and isolation, the world's only bet at beating the deadliest virus of our times is a vaccine. Thanks to advanced research and technology, we're closer, sooner than expected, to a vaccine candidate. Here's what you should know:Numbers, numbers: Just how many vaccine candidates are there? 79420387But, which ones should the world be optimistic about? 79420391And the outside candidates? 79420396How long before India gets its doses? 79420408(As everywhere, the rich get theirs first) 79420399What about manufacturing? 79420401
Categories: Business News

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