Business News

Mumbai: A renewed wave of optimism lifted domestic lenders to record levels as better-than-expected March quarter results at top banks buttressed their investment case, already in focus of late on account of the preference for sectors benefiting from local prospects amid lingering uncertainty over trade tariffs. Expectations of more interest rate cuts, with the Reserve Bank of India signalling its intent to ease liquidity conditions, are also fuelling investor appetite for banks of late.The NSE's Nifty Bank index surged 1.9% on Monday, boosting the gauge to record highs, scaling the highs last made on September 26. The broader NSE Nifty surged 1.15% to 24,125.55 points while the BSE Sensex was up 1.09% to 79,408.50 points. AU Small Finance Bank was the top gainer on the Nifty Bank Index, up 7.3%, followed by IDFC First Bank and IndusInd Bank, which gained 5.8% and 4%, respectively. Investor appetite for banks got a boost after the fourth-quarter results of HDFC Bank and ICICI Bank over the weekend beat estimates. HDFC rose 1% and ICICI was up 0.1%.120501438 'Rally Driven by Rate Cuts' "Banks did well on Monday, because of strong results from large private banks and the absence of negative surprises in terms of asset quality," said Ramesh Mantri, chief investment officer at WhiteOak Capital AMC. Private lenders are back on investors' radar as part of a broader shift in their interest in domestic economy-facing sectors, which are perceived to be relatively insulated from the effects of US President Donald Trump's tariffs on the global economy."While slower economic growth continues to be a concern, the banking sector is in a better position compared to many others during global uncertainty, since it mainly serves the domestic market," said Mantri.Since April 7, when the market recovery started, the Bank Nifty index has gained nearly 11% as against the 9% upmove in the Nifty. The bounce in bank shares was instrumental in lifting the key indices because the weight of shares of lenders on these benchmarks is the highest at nearly 30%. So far in 2025, the Nifty Bank index has moved up 8.7%, against the Nifty's gains of 2%. "The recent rally in banking stocks can be largely attributed to the ongoing interest rate cut cycle, which has been beneficial for the sector," said Vikas Khemani, founder, Carnelian Asset Management and Advisors. "Rate cuts also tend to support credit growth within the broader economy, and we believe this move positions banks favourably for the next 12-18 months."The RBI has cut the key policy rate by a total 50 basis points this year. This is expected to ease pressure on banks' margins.Banks and non-banking finance companies (NBFCs) - mostly mid and small-sized - had been beaten down in the sell-off since late September on account of rising bad loans in the microfinance segment and other asset quality concerns. The RBI had flagged asset quality concerns for unsecured loans in December last year. Much of this has eased for now."Most asset quality concerns in the banking sector have been addressed, and we believe the next two to three years will see a phase of leveraging that should support growth for banks," said Anil Rego, founder and fund manager at Right Horizons Portfolio Management Services.

Continuum Green Energy Limited (CGEL), an independent power producer (IPP) which identifies, develops, constructs and operates renewable energy projects in India, received capital markets regulator Sebi go ahead to raise Rs 3,650-crore through an IPO.The company had filed the DRHP in December 2024 and obtained its observation letter on April 15, an update with the Sebi showed.The proposed IPO is a combination of a fresh issue of equity shares valued Rs 1,250 crore and an offer for sale (OFS) of equity shares worth Rs 2,400 crore by promoter Continuum Green Energy Holdings.The company proposes to utilize the funds from the fresh issue to repay or partially repay certain loans taken by its subsidiaries, including accrued interest, by investing Rs 1,100 crore in these subsidiaries. The remaining funds will be allocated for general corporate purposes.Incorporated in 2007, Continuum Green Energy owns and operates large wind projects and large wind-solar co-located/hybrid projects in India, with a total operational capacity of 2.22 GWp and under-construction capacity of 1.31 GWp. Of the entire 3.52 GWp capacity, it has a balanced split of energy source between wind and solar capacity.As of June 30, 2024, Continuum Green Energy Limited had PPAs with more than 170 diversified, high credit quality C&I consumers for green energy supply.In 2024, Continuum Green Energy received primary equity investment from JC Infinity (B) Limited, an affiliate of a fund advised by Just Climate LLP.On the financial front, the company's revenue from operations increased 33.45 per cent to Rs 1,294 crore in fiscal 2024 from Rs 970 crore in fiscal 2023.Kotak Mahindra Capital, Ambit, Citigroup Global Markets India, and JM Financial are the book running lead managers to the offer.