Tuesday, January 31, 2023
Budget Likely To Lower Fiscal Deficit, Push Spending On Education, Health
Presenting its annual budget to parliament on Wednesday, the central government will seek to lower its fiscal deficit while offering incentives for investment and stepping up state spending to support an economy that is caught in the global slowdown.
Although the government faces elections in key states this year and a national vote in 2024, the budget is unlikely to offer major relief to households due to fiscal constraints, officials have said, while noting that the budget would focus on long-term growth.
Since taking charge in 2014, Prime Minister Narendra Modi has ramped up capital spending including on roads and energy, while wooing investors through lower tax rates and labour reforms, and offering subsidies to poor households to clinch their political support.
Finance Minister Nirmala Sitharaman is widely expected to continue that policy, and announce 10% to 12% increase in budget allocations for health, education and rural projects, helped by a pick up in tax collections.
"The annual budget will continue economic reforms," said Gopal Krishna Agarwal, economic affairs spokesman of the ruling Bharatiya Janata Party.
"The easing of retail inflation, higher state spending and growing bank credit would help the economic recovery ahead of the national elections," he said.
Critics, however, say PM Modi's economic policies have largely benefited big companies, while putting more tax burden on middle class families, who are now facing lower growth in both real income and jobs.
A finance ministry's annual Economic Survey, released on Tuesday, forecast the economy could grow 6% to 6.8% year-on-year next fiscal year, down from 7% projected for the current year, while warning about the impact of global slowdown on exports.
"India's growth outlook seems better than in the pre-pandemic years, and the Indian economy is prepared to grow at its potential in the medium term," the report said.
International Monetary Fund has forecast India's economy would grow by 6.1% in 2023/24, slowing from 6.8% in this fiscal year.
Like many other economies, India faces a risk from the global slowdown, which would impact domestic manufacturing and exports. And higher global prices for fuel and commodities caused a surge in inflation higher, and led to higher interest rates, which has also dampened economic growth.
The Reserve Bank of India has raised its benchmark policy rate by 225 basis points since May 2022 to tame retail inflation - which accelerated to over 7% after a surge in food and energy prices following the Ukraine war.
Economy has slowed after growing 8.7% in 2021/22, when it was helped by economic rebound after a 6.6% contraction during the pandemic.
Worried over rising public debt, the federal government is likely to cut its fiscal deficit to between 5.8% and 5.9% of GDP in 2023/24 from the 6.4% of 2022/23, officials have said.
The government has already stopped the pandemic-era free food programme and is expected to cut subsidies for food and fertiliser by nearly $17 billion.
Sitharaman could, however, tweak tax rules including through an alteration to the structure of the capital gains tax that would encourage investment, officials said.
She is also likely to expand production linked incentives for more sectors, and new investments to meet India's net-zero carbon emissions goal by 2070, they added.
The government is expected to borrow a record 16 trillion rupees in 2023/24, according to a Reuters poll.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Budget Likely To Lower Fiscal Deficit, Push Spending On Education, Health
Presenting its annual budget to parliament on Wednesday, the central government will seek to lower its fiscal deficit while offering incentives for investment and stepping up state spending to support an economy that is caught in the global slowdown.
Although the government faces elections in key states this year and a national vote in 2024, the budget is unlikely to offer major relief to households due to fiscal constraints, officials have said, while noting that the budget would focus on long-term growth.
Since taking charge in 2014, Prime Minister Narendra Modi has ramped up capital spending including on roads and energy, while wooing investors through lower tax rates and labour reforms, and offering subsidies to poor households to clinch their political support.
Finance Minister Nirmala Sitharaman is widely expected to continue that policy, and announce 10% to 12% increase in budget allocations for health, education and rural projects, helped by a pick up in tax collections.
"The annual budget will continue economic reforms," said Gopal Krishna Agarwal, economic affairs spokesman of the ruling Bharatiya Janata Party.
"The easing of retail inflation, higher state spending and growing bank credit would help the economic recovery ahead of the national elections," he said.
Critics, however, say PM Modi's economic policies have largely benefited big companies, while putting more tax burden on middle class families, who are now facing lower growth in both real income and jobs.
A finance ministry's annual Economic Survey, released on Tuesday, forecast the economy could grow 6% to 6.8% year-on-year next fiscal year, down from 7% projected for the current year, while warning about the impact of global slowdown on exports.
"India's growth outlook seems better than in the pre-pandemic years, and the Indian economy is prepared to grow at its potential in the medium term," the report said.
International Monetary Fund has forecast India's economy would grow by 6.1% in 2023/24, slowing from 6.8% in this fiscal year.
Like many other economies, India faces a risk from the global slowdown, which would impact domestic manufacturing and exports. And higher global prices for fuel and commodities caused a surge in inflation higher, and led to higher interest rates, which has also dampened economic growth.
The Reserve Bank of India has raised its benchmark policy rate by 225 basis points since May 2022 to tame retail inflation - which accelerated to over 7% after a surge in food and energy prices following the Ukraine war.
Economy has slowed after growing 8.7% in 2021/22, when it was helped by economic rebound after a 6.6% contraction during the pandemic.
Worried over rising public debt, the federal government is likely to cut its fiscal deficit to between 5.8% and 5.9% of GDP in 2023/24 from the 6.4% of 2022/23, officials have said.
The government has already stopped the pandemic-era free food programme and is expected to cut subsidies for food and fertiliser by nearly $17 billion.
Sitharaman could, however, tweak tax rules including through an alteration to the structure of the capital gains tax that would encourage investment, officials said.
She is also likely to expand production linked incentives for more sectors, and new investments to meet India's net-zero carbon emissions goal by 2070, they added.
The government is expected to borrow a record 16 trillion rupees in 2023/24, according to a Reuters poll.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Budget 2023 To Set Foundation For Growth Amid Global Gloom: 10 Facts
- Predictably, India's middle class is looking for some form of income-tax relief. Though the tax slab wasn't changed and no new deduction was announced last year, inflation has eaten into people's earnings. They haven't seen a change in tax rate since 2017-18 and in tax slab since July 2014.
- Ms Sitharaman may be able to afford a balanced, not a populist, Budget since the general election is still a year and one more Union Budget away. Still, with Prime Minister Narendra Modi's BJP hoping to win a third consecutive term, massive welfare programmes for farmers and the rural population can't be ruled out.
- The Finance Ministry had been considering increasing the limit under 80C, which includes investment in life insurance, fixed deposit, bonds, housing and public provident fund. If this happens, it will encourage savings and help raise rainy day funds of people whose savings were eroded at the height of the COVID-19 pandemic.
- The markets in India - Asia's third-biggest economy - will be closely watched when Ms Sitharaman begins her Budget speech at 11 am. Adani group companies led most of the fluctuations last week, but on Tuesday its Rs 20,000 crore follow-on share sale sailed through, bringing relief to the group that's facing allegations of fraud made by US-based short-seller Hindenburg.
- The Modi government may strengthen its "Make In India" and "Atmanirbhar Bharat" policies by giving financial benefits to manufacturers and suppliers who want to set up shop in the country. India has been advertising itself as an alternative to China in the global supply chain.
- The real estate sector, which nosedived during the pandemic, expects the centre to announce favourable schemes and tax breaks to improve its luck after a slow but surefooted revival last year. In 2019, the goods and services tax, or GST, council cut the tax rate on affordable houses from 8 per cent to 1 per cent. The sector expects similar announcements in this Budget too.
- Over half of India's population is under 30. For them, the focus would be on job security and reduced tax on products that they prefer to buy, such as electronic goods. Better terms for education loans and other forms of financial help for school and higher education will be keenly watched.
- The farm sector went through difficult times in 2022 due to global supply problems, unseasonal rains and floods, effects of climate change and the war in Ukraine. Ms Sitharaman would likely have something to cushion them from all these shocks. After all, farmers make for a large and influential voter base.
- Ms Sitharaman may pick up from where she left on "digital rupee", which was first announced in last year's Budget as a possible alternative to cryptocurrencies. Crypto trades have in recent times become wildly popular across the globe, albeit risky since there's exists a grey area of regulation. The Finance Minister may give a status update on "digital rupee".
- A Bloomberg brief of what to expect includes extension of long-term capital gains tax to immovable property and unlisted shares, compensation to oil retailers for selling fuel below market prices, cut in import taxes on gold to 10 per cent to rein in illegal shipments and increase in defence budget amid border tensions with China.
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Budget 2023 To Set Foundation For Growth Amid Global Gloom: 10 Facts
- Predictably, India's middle class is looking for some form of income-tax relief. Though the tax slab wasn't changed and no new deduction was announced last year, inflation has eaten into people's earnings. They haven't seen a change in tax rate since 2017-18 and in tax slab since July 2014.
- Ms Sitharaman may be able to afford a balanced, not a populist, Budget since the general election is still a year and one more Union Budget away. Still, with Prime Minister Narendra Modi's BJP hoping to win a third consecutive term, massive welfare programmes for farmers and the rural population can't be ruled out.
- The Finance Ministry had been considering increasing the limit under 80C, which includes investment in life insurance, fixed deposit, bonds, housing and public provident fund. If this happens, it will encourage savings and help raise rainy day funds of people whose savings were eroded at the height of the COVID-19 pandemic.
- The markets in India - Asia's third-biggest economy - will be closely watched when Ms Sitharaman begins her Budget speech at 11 am. Adani group companies led most of the fluctuations last week, but on Tuesday its Rs 20,000 crore follow-on share sale sailed through, bringing relief to the group that's facing allegations of fraud made by US-based short-seller Hindenburg.
- The Modi government may strengthen its "Make In India" and "Atmanirbhar Bharat" policies by giving financial benefits to manufacturers and suppliers who want to set up shop in the country. India has been advertising itself as an alternative to China in the global supply chain.
- The real estate sector, which nosedived during the pandemic, expects the centre to announce favourable schemes and tax breaks to improve its luck after a slow but surefooted revival last year. In 2019, the goods and services tax, or GST, council cut the tax rate on affordable houses from 8 per cent to 1 per cent. The sector expects similar announcements in this Budget too.
- Over half of India's population is under 30. For them, the focus would be on job security and reduced tax on products that they prefer to buy, such as electronic goods. Better terms for education loans and other forms of financial help for school and higher education will be keenly watched.
- The farm sector went through difficult times in 2022 due to global supply problems, unseasonal rains and floods, effects of climate change and the war in Ukraine. Ms Sitharaman would likely have something to cushion them from all these shocks. After all, farmers make for a large and influential voter base.
- Ms Sitharaman may pick up from where she left on "digital rupee", which was first announced in last year's Budget as a possible alternative to cryptocurrencies. Crypto trades have in recent times become wildly popular across the globe, albeit risky since there's exists a grey area of regulation. The Finance Minister may give a status update on "digital rupee".
- A Bloomberg brief of what to expect includes extension of long-term capital gains tax to immovable property and unlisted shares, compensation to oil retailers for selling fuel below market prices, cut in import taxes on gold to 10 per cent to rein in illegal shipments and increase in defence budget amid border tensions with China.
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Monday, January 30, 2023
KM Birla's Son, Daughter Inducted Into Aditya Birla Fashion Board
Aditya Birla Fashion and Retail Ltd on Monday announced appointments of Ananyashree Birla and Aryaman Birla, children of its Chairman Kumar Mangalam Birla, as additional non-executive directors on its board.
The board of directors at its meeting held on Monday, based on the recommendation of the nomination and remuneration committee, has approved the appointments of Ananyashree and Aryaman as additional non-executive directors on the board of the company with effect from January 30, 2023, Aditya Birla Fashion and Retail Ltd (ABRFL) said in a regulatory filing.
They will be liable to retire by rotation in accordance with the Companies Act, 2013 and their appointment is subject to the approval of the shareholders, it added.
Ananya Birla is a successful business woman and platinum selling artist, the company said, adding her first company Svatantra Microfin Pvt Ltd is amongst India's fastest growing microfinance institutions.
It has crossed an asset under management of USD 1 billion with over 7,000 employees and had successfully acquired Micro Housing Finance Corporation Ltd in 2018.
She is also the founder of design-led home decor brand Ikai Asai. She has also co-founded Mpower, and advocates the need for conversations around mental health in India.
On the other hand, Aryaman comes with diverse experience, including entrepreneurship, VC investing, and professional sport, the filing added.
He is closely involved with several businesses of the Aditya Birla Group.
"In consultation with the Group Chairman Kumar Mangalam Birla, he is actively championing the Group's foray into newage businesses," the company said, adding, he also helped incubate the group's D2C platform TMRW and is a director on its board. He is also spearheading the group's venture capital fund Aditya Birla Ventures. Prior to joining ABG, he was a first-class cricketer, it added.
"Ananya and Aryaman's exceptional individual achievements in their chosen fields and early success with their independent entrepreneurial ventures set them up well for larger responsibilities," Aditya Birla Group Chairman Kumar Mangalam Birla said in a statement.
He further said, "Their nuanced understanding of new-age business models and emerging shifts in consumer behaviour will infuse fresh energy to the board of ABFRL." In the last few years, ABFRL has entered multiple new emerging segments such as ethnic wear -- including partnerships with Indian designers, luxury, sportswear and new age businesses through its digital venture TMRW. The ABFRL platform is now poised for a new wave of exponential growth, Birla added.
Ananya and Aryaman have recently been inducted as directors on the board of Aditya Birla Management Corporation Pvt Ltd, the apex body that provides strategic direction to the Aditya Birla Group's businesses.
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KM Birla's Son, Daughter Inducted Into Aditya Birla Fashion Board
Aditya Birla Fashion and Retail Ltd on Monday announced appointments of Ananyashree Birla and Aryaman Birla, children of its Chairman Kumar Mangalam Birla, as additional non-executive directors on its board.
The board of directors at its meeting held on Monday, based on the recommendation of the nomination and remuneration committee, has approved the appointments of Ananyashree and Aryaman as additional non-executive directors on the board of the company with effect from January 30, 2023, Aditya Birla Fashion and Retail Ltd (ABRFL) said in a regulatory filing.
They will be liable to retire by rotation in accordance with the Companies Act, 2013 and their appointment is subject to the approval of the shareholders, it added.
Ananya Birla is a successful business woman and platinum selling artist, the company said, adding her first company Svatantra Microfin Pvt Ltd is amongst India's fastest growing microfinance institutions.
It has crossed an asset under management of USD 1 billion with over 7,000 employees and had successfully acquired Micro Housing Finance Corporation Ltd in 2018.
She is also the founder of design-led home decor brand Ikai Asai. She has also co-founded Mpower, and advocates the need for conversations around mental health in India.
On the other hand, Aryaman comes with diverse experience, including entrepreneurship, VC investing, and professional sport, the filing added.
He is closely involved with several businesses of the Aditya Birla Group.
"In consultation with the Group Chairman Kumar Mangalam Birla, he is actively championing the Group's foray into newage businesses," the company said, adding, he also helped incubate the group's D2C platform TMRW and is a director on its board. He is also spearheading the group's venture capital fund Aditya Birla Ventures. Prior to joining ABG, he was a first-class cricketer, it added.
"Ananya and Aryaman's exceptional individual achievements in their chosen fields and early success with their independent entrepreneurial ventures set them up well for larger responsibilities," Aditya Birla Group Chairman Kumar Mangalam Birla said in a statement.
He further said, "Their nuanced understanding of new-age business models and emerging shifts in consumer behaviour will infuse fresh energy to the board of ABFRL." In the last few years, ABFRL has entered multiple new emerging segments such as ethnic wear -- including partnerships with Indian designers, luxury, sportswear and new age businesses through its digital venture TMRW. The ABFRL platform is now poised for a new wave of exponential growth, Birla added.
Ananya and Aryaman have recently been inducted as directors on the board of Aditya Birla Management Corporation Pvt Ltd, the apex body that provides strategic direction to the Aditya Birla Group's businesses.
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"India A Bright Spot": IMF Predicts Global Growth To Fall To 2.9%
The International Monetary Fund (IMF) on Tuesday said it is expecting some slowdown in the Indian economy next fiscal year and projected the growth to 6.1 percent from 6.8 percent during the current fiscal ending March 31.
The IMF on Tuesday released the January update of its World Economic Outlook, according to which the global growth is projected to fall from an estimated 3.4 percent in 2022 to 2.9 percent in 2023, then rise to 3.1 percent in 2024.
“Our growth projections actually for India are unchanged from our October Outlook. We have 6.8 percent growth for this current fiscal year, which runs until March, and then we're expecting some slowdown to 6.1 percent in fiscal year 2023. And that is largely driven by external factors,” Pierre-Olivier Gourinchas, Chief Economist and Director, Research Department of the IMF told reporters here.
“Growth in India is set to decline from 6.8 percent in 2022 to 6.1 percent in 2023 before picking up to 6.8 percent in 2024, with resilient domestic demand despite external headwinds,” said the IMF's World Economic Outlook update.
According to the report, growth in emerging and developing Asia is expected to rise in 2023 and 2024 to 5.3 percent and 5.2 percent, respectively, after the deeper-than-expected slowdown in 2022 to 4.3 percent attributable to China's economy.
China's real GDP slowdown in the fourth quarter of 2022 implies a 0.2 percentage point downgrade for 2022 growth to 3.0 percen -- the first time in more than 40 years with China's growth below the global average. Growth in China is projected to rise to 5.2 percent in 2023, reflecting rapidly improving mobility, and to fall to 4.5 percent in 2024 before settling at below 4 percent over the medium term amid declining business dynamism and slow progress on structural reforms.
“Overall, I want to point out that emerging market economies on the whole and developing economies seem to be already on their way up. We have a slight increase in growth for the region from 3.9 percent in 2022 to 4 percent in 2023,” Gourinchas said.
“Another relevant point here is that if we look at both China and India together, they account for about 50 percent of world growth in 2023. So a very significant contribution,” he said.
“I want to say, we had a positive view on India in our October forecast. That positive view is largely unchanged,” Gourinchas said in response to a question.
In a blog post he wrote that India remains a bright spot. Together with China, it will account for half of global growth this year, versus just a 10th for the US and euro area combined, he added.
For advanced economies, the slowdown will be more pronounced, with a decline from 2.7 percent last year to 1.2 percent and 1.4 percent this year and next. Nine out of 10 advanced economies will likely decelerate, Gourinchas said.
The US' growth will slow to 1.4 percent in 2023 as Federal Reserve interest-rate hikes work their way through the economy. Euro area conditions are more challenging despite signs of resilience to the energy crisis, a mild winter, and generous fiscal support, he said.
“With the European Central Bank tightening monetary policy, and a negative terms-of-trade shock — due to the increase in the price of its imported energy — we expect growth to bottom out at 0.7 percent this year,” Gourinchas wrote.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Budget, US Fed Rate Decision Key Events This Week For Equity Investors
For equity investors, the Union Budget for 2023-24 and the US Fed's interest rate decision will be the major events to watch out for this week, analysts said. The ongoing earnings season, global market cues, domestic macroeconomic data announcements and auto sales numbers would also influence trading in the market, they added.
"The Union Budget is a key domestic event on February 1st, and the outcome of the US Federal Open Market Committee (FOMC) meeting scheduled for the same day late at night is a key global event. A bunch of companies will come out with Q3 earnings this week, while monthly auto sales numbers and macroeconomic numbers from the USA will be other important factors. The market will continue to monitor the Adani Group. FIIs' flow will be important," said Santosh Meena, Head of Research, Swastika Investmart Ltd.
Adani group stocks fell sharply last week after US-based investment research firm Hindenburg Research made damaging allegations against the conglomerate.
From the macroeconomic front, the Purchasing Managers' Index (PMI) data for manufacturing and services sectors are due to be announced on Wednesday and Friday, respectively.
"With the Union Budget scheduled to be unveiled on February 1, the week will be jam-packed with activity. The ongoing quarterly earnings will also have an impact on how each stock moves. The FOMC meeting will catch market players' eyes on a global scale," said Apurva Sheth, Head of Market Perspectives & Research, SAMCO Securities.
Market trends will also be guided by trading activity of foreign investors who have pulled out a net Rs 17,000 crore this month so far.
"This week is going to be critical not only for the financial markets but for the economy as well due to the scheduled Union Budget on February 1. Besides, participants will be eyeing the outcome of the US Fed meet on the same day.
"On the data front, auto numbers, manufacturing PMI and services PMI will also be in focus. As the earnings season gain pace, a lot of major names like Larsen & Toubro, ACC, Sun Pharma, HDFC, ITC and SBI will report their numbers during the week," said Ajit Mishra, VP - Technical Research, Religare Broking Ltd.
Last week, the BSE barometer Sensex had tumbled 1,290.87 points or 2.12 per cent.
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Sunday, January 29, 2023
60% Households Expect Dip In Earnings, Seek Relief In Budget: Report
More than half of households in a survey conducted online across 309 districts expect a decline in their income by up to 25 per cent and dip in savings, and are looking for relief in the coming budget, online platform LocalCircles said on Sunday.
The survey, conducted between November 25 and January 25, found that with job losses and hiring sentiment turning negative, 52 per cent respondents feel that the economic uncertainty will persist for the next 6-12 months.
LocalCircles claimed that 37,000 responses were received from household consumers across 309 districts of India, comprising 64 per cent men, 36 per cent women from tier 1, tier 2 and smaller towns as well.
"Our survey indicates that majority households in the country are facing the squeeze and in community discussions thousands of inputs were received by LocalCircles about lowering income tax rates or increasing deductions and exemptions," LocalCircles founder Sachin Taparia said.
The number of responses on each question varied.
In response to questions on expected change in income, 7 per cent households projected a 25 per cent drop in annual income during the current fiscal, 22 per cent projected a 10-15 per cent drop, 10 per cent projected a drop of up to 10 per cent and 21 per cent felt their income will reduce but they were uncertain about the scale.
Fifty-six per cent household consumers surveyed believe their average household savings will reduce during the current fiscal while only 19 per cent households expect an increase, according to the survey.
In response to questions around economic uncertainty, 52 per cent out of over 13,000 respondents expressed that they expect economic uncertainty to last 6-12 months while 23 per cent expected the uncertainty to last 3-6 months in 2023, 6 per cent felt uncertainty may last up to 3 months while 19 per cent were not sure about it.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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60% Households Expect Dip In Earnings, Seek Relief In Budget: Report
More than half of households in a survey conducted online across 309 districts expect a decline in their income by up to 25 per cent and dip in savings, and are looking for relief in the coming budget, online platform LocalCircles said on Sunday.
The survey, conducted between November 25 and January 25, found that with job losses and hiring sentiment turning negative, 52 per cent respondents feel that the economic uncertainty will persist for the next 6-12 months.
LocalCircles claimed that 37,000 responses were received from household consumers across 309 districts of India, comprising 64 per cent men, 36 per cent women from tier 1, tier 2 and smaller towns as well.
"Our survey indicates that majority households in the country are facing the squeeze and in community discussions thousands of inputs were received by LocalCircles about lowering income tax rates or increasing deductions and exemptions," LocalCircles founder Sachin Taparia said.
The number of responses on each question varied.
In response to questions on expected change in income, 7 per cent households projected a 25 per cent drop in annual income during the current fiscal, 22 per cent projected a 10-15 per cent drop, 10 per cent projected a drop of up to 10 per cent and 21 per cent felt their income will reduce but they were uncertain about the scale.
Fifty-six per cent household consumers surveyed believe their average household savings will reduce during the current fiscal while only 19 per cent households expect an increase, according to the survey.
In response to questions around economic uncertainty, 52 per cent out of over 13,000 respondents expressed that they expect economic uncertainty to last 6-12 months while 23 per cent expected the uncertainty to last 3-6 months in 2023, 6 per cent felt uncertainty may last up to 3 months while 19 per cent were not sure about it.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Saturday, January 28, 2023
Adani Group Rules Out Changes In Price, Dates Of Sale Of New Shares
Billionaire Gautam Adani's group on Saturday ruled out any changes in price or the dates of the Rs 20,000 crore follow-on share sale at the conglomerate's flagship firm despite its stocks being hammered below the offer price after a scathing report by a US short seller.
"Adani Enterprises Limited's further public offer (FPO) is going as per schedule and the announced price band. There is no change in either the schedule of the issue price," a group spokesperson said.
The FPO got subscribed just one per cent on the opening day on Friday. Against an offer of 4.55 crore shares of Adani Enterprises Ltd, only 4.7 lakh shares were subscribed, according to information available from the BSE.
Adani Enterprises fell almost 20 per cent to below the offer price of its secondary sale as all the seven listed companies of the conglomerate took a beating in the aftermath of Hindenburg Research alleging that the group was "engaged in a brazen stock manipulation and accounting fraud scheme over the course of decades".
The Group has dismissed the report as malicious and bogus aimed at torpedoing the FPO.
Adani Enterprises is selling shares in a price band of Rs 3,112 to Rs 3,276. On Friday, its share price closed at Rs 2,762.15 on the BSE.
"All our stakeholders including bankers and investors have full faith in the FPO. We are extremely confident about the success of the FPO," the spokesperson added.
The FPO closes on January 31.
On Wednesday, Adani Enterprises raised Rs 5,985 crore from anchor investors.
The company allotted 1.82 crore equity shares to 33 funds at Rs 3,276 apiece, taking the transaction size to Rs 5,985 crore, according to a circular uploaded on the BSE website.
Foreign investors who picked up the shares included Abu Dhabi Investment Authority, BNP Paribas Arbitrage, Societe Generale, Goldman Sachs Investment (Mauritius) Ltd, Morgan Stanley Asia (Singapore) Pte, Nomura Singapore Ltd and Citigroup Global Markets Mauritius.
A slew of domestic institutional investors, including LIC, SBI Life Insurance Company, HDFC Life Insurance Company and State Bank Of India Employees Pension Fund, also participated in the anchor book.
Out of the Rs 20,000-crore proceeds from the FPO, Rs 10,869 crore will be used for green hydrogen projects, work at the existing airports and construction of a greenfield expressway.
An amount of Rs 4,165 crore will be utilised for repayment of debt taken by its airports, road and solar project subsidiaries.
Adani Enterprises is India's largest listed business incubator and breeds businesses in four core industry sectors -- energy and utility, transportation and logistics, consumer, and primary industry.
The current business portfolio includes green hydrogen ecosystem, data centres, airports, digital, mining, defence and industrial manufacturing.
(Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group Company.)
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Adani Group Rules Out Changes In Price, Dates Of Sale Of New Shares
Billionaire Gautam Adani's group on Saturday ruled out any changes in price or the dates of the Rs 20,000 crore follow-on share sale at the conglomerate's flagship firm despite its stocks being hammered below the offer price after a scathing report by a US short seller.
"Adani Enterprises Limited's further public offer (FPO) is going as per schedule and the announced price band. There is no change in either the schedule of the issue price," a group spokesperson said.
The FPO got subscribed just one per cent on the opening day on Friday. Against an offer of 4.55 crore shares of Adani Enterprises Ltd, only 4.7 lakh shares were subscribed, according to information available from the BSE.
Adani Enterprises fell almost 20 per cent to below the offer price of its secondary sale as all the seven listed companies of the conglomerate took a beating in the aftermath of Hindenburg Research alleging that the group was "engaged in a brazen stock manipulation and accounting fraud scheme over the course of decades".
The Group has dismissed the report as malicious and bogus aimed at torpedoing the FPO.
Adani Enterprises is selling shares in a price band of Rs 3,112 to Rs 3,276. On Friday, its share price closed at Rs 2,762.15 on the BSE.
"All our stakeholders including bankers and investors have full faith in the FPO. We are extremely confident about the success of the FPO," the spokesperson added.
The FPO closes on January 31.
On Wednesday, Adani Enterprises raised Rs 5,985 crore from anchor investors.
The company allotted 1.82 crore equity shares to 33 funds at Rs 3,276 apiece, taking the transaction size to Rs 5,985 crore, according to a circular uploaded on the BSE website.
Foreign investors who picked up the shares included Abu Dhabi Investment Authority, BNP Paribas Arbitrage, Societe Generale, Goldman Sachs Investment (Mauritius) Ltd, Morgan Stanley Asia (Singapore) Pte, Nomura Singapore Ltd and Citigroup Global Markets Mauritius.
A slew of domestic institutional investors, including LIC, SBI Life Insurance Company, HDFC Life Insurance Company and State Bank Of India Employees Pension Fund, also participated in the anchor book.
Out of the Rs 20,000-crore proceeds from the FPO, Rs 10,869 crore will be used for green hydrogen projects, work at the existing airports and construction of a greenfield expressway.
An amount of Rs 4,165 crore will be utilised for repayment of debt taken by its airports, road and solar project subsidiaries.
Adani Enterprises is India's largest listed business incubator and breeds businesses in four core industry sectors -- energy and utility, transportation and logistics, consumer, and primary industry.
The current business portfolio includes green hydrogen ecosystem, data centres, airports, digital, mining, defence and industrial manufacturing.
(Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group Company.)
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Budget 2023: This Law Plays A Key Role In Government Expenses
The Union Budget is not a single document. It is a list of 13 documents and three of them - Annual Financial Statement (AFS), Demands for Grants (DG) and the Finance Bill - are mandated by Article 112,113 and 110(a) of the Constitution. Some documents are explanatory notes, which support the mandated documents with narrative for quick or contextual references.
There are two other documents which are a 21st Century addition to the Union Budget. These documents - Macro-Economic Framework Statement and Medium-Term Fiscal Policy cum Fiscal Policy Strategy Statement - are statements under the Fiscal Responsibility and Budget Management (FRBM) Act, 2003. These documents broadly look at the economic health of the country.
What is the FRBM Act?
This Act was enacted in 2003 to help the Centre adhere to the path of fiscal consolidation, which refer to concrete policies for reducing government deficits and debt accumulation. It came into force on July 5, 2004. The Act mandates the Centre to limit the fiscal deficit up to three per cent of Gross Domestic Product (GDP) by March 31, 2021. It further mandates the Centre to limit the General Government Debt to 60 per cent of the GDP and the Centre's Debt to 40 per cent of GDP, by March 31, 2025.
However, the central government has never been able to meet the three per cent target. The three per cent fiscal deficit ceiling is purportedly inspired from the Maastricht treaty, which required annual budget deficits to not cross three per cent of the GDP. However, not just India but several European nations too have not been able to respect the ceiling.
Macro-Economic Framework Statement
The Macro-Economic Framework Statement assesses the GDP growth prospects, domestic economy and the stability of the external sector. It also looks at the fiscal balance of the Centre, which measures the difference between total government spending and revenue. This balance can more often be negative in the modern world, leading to fiscal deficit.
In 2021-22, India's fiscal deficit was at 6.8 per cent of GDP. As per last year's data, the total expenditure in Budget Estimate (BE) 2021-22 was estimated to have increased by one per cent over Revised Estimate 2020-21.
"The Fiscal deficit of the Central Government during April to November 2021 stood at 46.2 per cent of the BE, much lower compared to 135.1 per cent during the same period in 2020-21 and 114.8 per cent during the same period in 2019-20," the 2022 statement tabled by Finance Minister Nirmala Sitharaman noted.
Medium-Term Fiscal Policy cum Fiscal Policy Strategy Statement
The other document, Medium-Term Fiscal Policy cum Fiscal Policy Strategy Statement, sets the three-year rolling targets for specific fiscal indicators - Fiscal Deficit, Revenue Deficit, Primary Deficit, Tax Revenue, Non-tax Revenue and Central Government Debt.
It also explains how the current fiscal policies are in conformity with sound fiscal management principles and gives the rationale for any major deviation in key fiscal measures. For instance, the Covid-19 pandemic led to unprecedented levels of spending, resulting in higher fiscal deficit.
"Notwithstanding the uncertainty and challenges posed by the pandemic, the Central Government has demonstrated commitment to credible fiscal consolidation in its Budget of FY 2021-22 and FY 2022- 23... As a result, the Indian economy is expected to return to a more stable growth trajectory over the medium term," the document read.
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Union Budget 2023: Will Blockchain-Based Digital Currency Come Of Age?
Central Bank Digital Currency or CBDCs have captured the imagination of central banks around the world. Recently, the Reserve Bank of India (RBI) launched the pilot 'digital rupee' project and reports suggest that it may further expand the project "based on the learnings from the current pilot."
Governor Shaktikanta Das' recent statement on CBDC adoption indicates that 'digital rupee' may get a boost.
"Central banks issued digital currencies are the future of money and its adoption can help save on logistic and printing costs," he said at a recent event.
With the Union Budget around the corner, industry watchers expect some announcement regarding the digital rupee.
"I think CBDC will be a hot topic of discussion in this year's Budget," says Kamlesh Nagware, CTO at Snapper Future Tech, a blockchain firm. He believes that Finance Minister Nirmala Sitharaman may announce measures to enable offline, cross-border payment and digital asset ecosystem for CBDCs.
The Government of India has been a votary of CBDCs. In her last Budget speech, Ms Sitharaman said 'digital rupee' will lead to a more efficient and cheaper currency management system.
For the unversed, CBDCs are the digital version of the official currency, backed by the central bank. They are very often backed by blockchain technology, as is the case with the digital rupee.
"In the CBDC trial phase, 16,000 users made e-rupee transactions in one month. The beginning is excellent and holds enormous potential for the future of e-rupee," believes Amogh Tiwari, Founder of DayFi, an NFT-based financial utilities company.
Experts believe that blockchain is likely to get impetus in the coming years, with the Ministry of Electronics and Information Technology coming out with a 'National Strategy on Blockchain' in December 2021. Interestingly, this report mentions the idea of a government-backed digital currency wallet for transactions in the farm sector.
"We expect proper allocation for blockchain and its application on Indian infrastructure like cargo, finance, digital documents etc in this year's Budget," says Mr Tiwari.
CBDCs are among the most well-known use case of blockchain technology, which is considered safe, trustworthy, and transparent. Any discussion on CBDCs, however, is incomplete without their comparison with cryptos, which are also run on the principles of blockchain.
With the RBI governor calling crypto currency "nothing but gambling" while calling for an outright ban and the Finance Minister seeking an international collaboration for crypto regulation, the future of Indian crypto market continues to be in limbo.
"There is no relation between crypto and CBDC. The government will focus on the latter as an alternative," says Mr Nagware. Mr Tiwari too speaks on similar lines and adds that CBDCs represents a significant step in the adoption of blockchain.
Both believe that digital rupee will help in larger adoption and mainstreaming of digital currencies in general across the country. "E-Rupee will help to build stronger regulations because the government and stakeholders could have wide level understanding of digital currency and digital assets," says Mr Nagware.
According to one estimate, adopting digital assets like CBDCs and other blockchain-backed assets can help India add $1 trillion to its economy by 2032.
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Union Budget 2023: Will Blockchain-Based Digital Currency Come Of Age?
Central Bank Digital Currency or CBDCs have captured the imagination of central banks around the world. Recently, the Reserve Bank of India (RBI) launched the pilot 'digital rupee' project and reports suggest that it may further expand the project "based on the learnings from the current pilot."
Governor Shaktikanta Das' recent statement on CBDC adoption indicates that 'digital rupee' may get a boost.
"Central banks issued digital currencies are the future of money and its adoption can help save on logistic and printing costs," he said at a recent event.
With the Union Budget around the corner, industry watchers expect some announcement regarding the digital rupee.
"I think CBDC will be a hot topic of discussion in this year's Budget," says Kamlesh Nagware, CTO at Snapper Future Tech, a blockchain firm. He believes that Finance Minister Nirmala Sitharaman may announce measures to enable offline, cross-border payment and digital asset ecosystem for CBDCs.
The Government of India has been a votary of CBDCs. In her last Budget speech, Ms Sitharaman said 'digital rupee' will lead to a more efficient and cheaper currency management system.
For the unversed, CBDCs are the digital version of the official currency, backed by the central bank. They are very often backed by blockchain technology, as is the case with the digital rupee.
"In the CBDC trial phase, 16,000 users made e-rupee transactions in one month. The beginning is excellent and holds enormous potential for the future of e-rupee," believes Amogh Tiwari, Founder of DayFi, an NFT-based financial utilities company.
Experts believe that blockchain is likely to get impetus in the coming years, with the Ministry of Electronics and Information Technology coming out with a 'National Strategy on Blockchain' in December 2021. Interestingly, this report mentions the idea of a government-backed digital currency wallet for transactions in the farm sector.
"We expect proper allocation for blockchain and its application on Indian infrastructure like cargo, finance, digital documents etc in this year's Budget," says Mr Tiwari.
CBDCs are among the most well-known use case of blockchain technology, which is considered safe, trustworthy, and transparent. Any discussion on CBDCs, however, is incomplete without their comparison with cryptos, which are also run on the principles of blockchain.
With the RBI governor calling crypto currency "nothing but gambling" while calling for an outright ban and the Finance Minister seeking an international collaboration for crypto regulation, the future of Indian crypto market continues to be in limbo.
"There is no relation between crypto and CBDC. The government will focus on the latter as an alternative," says Mr Nagware. Mr Tiwari too speaks on similar lines and adds that CBDCs represents a significant step in the adoption of blockchain.
Both believe that digital rupee will help in larger adoption and mainstreaming of digital currencies in general across the country. "E-Rupee will help to build stronger regulations because the government and stakeholders could have wide level understanding of digital currency and digital assets," says Mr Nagware.
According to one estimate, adopting digital assets like CBDCs and other blockchain-backed assets can help India add $1 trillion to its economy by 2032.
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Friday, January 27, 2023
Thursday, January 26, 2023
Wednesday, January 25, 2023
India's GDP Projected To "Remain Strong" At 5.8%, Says UN Report
India's GDP is projected to moderate to 5.8 per cent in 2023 as higher interest rates and global economic slowdown weigh on investment and exports, the United Nations said on Wednesday, noting that the country's economic growth is expected to remain "strong" even as prospects for other South Asian nations "are more challenging".
The World Economic Situation and Prospects 2023 report said the world output growth is projected to decelerate from an estimated three per cent in 2022 to 1.9 per cent in 2023, marking one of the lowest growth rates in recent decades as a "series of severe and mutually reinforcing shocks - the COVID-19 pandemic, the war in Ukraine and resulting food and energy crises, surging inflation, debt tightening, as well as the climate emergency - battered the world economy in 2022."
The report, produced by the United Nations Department of Economic and Social Affairs (UN DESA), said that in South Asia, the economic outlook has significantly deteriorated due to high food and energy prices, monetary tightening, and fiscal vulnerabilities. Average GDP growth is projected to moderate from 5.6 per cent in 2022 to 4.8 per cent in 2023.
"Growth in India is expected to remain strong at 5.8 per cent, albeit slightly lower than the estimated 6.4 per cent in 2022, as higher interest rates and a global slowdown weigh on investment and exports," it said.
The UN report said that "prospects are more challenging" for other economies in the South Asia region. Bangladesh, Pakistan and Sri Lanka sought financial assistance from the International Monetary Fund (IMF) in 2022.
While economic growth in India is projected to moderate in the calendar year 2023 to 5.8 per cent, with higher interest rates weighing on investment and slower global growth weakening exports, the report estimates that the country will grow at 6.7 per cent in 2024, the fastest-growing major economy in the world.
The report presents a gloomy and uncertain global economic outlook for the near term. Global growth is forecast to moderately pick up to 2.7 per cent in 2024 as some of the headwinds will begin to subside.
However, this is highly dependent on the pace and sequence of further monetary tightening, the course and consequences of the war in Ukraine, and the possibility of further supply-chain disruptions.
"This is not the time for short-term thinking or knee-jerk fiscal austerity that exacerbates inequality, increases suffering and could put the SDGs farther out of reach. These unprecedented times demand unprecedented action," United Nations Secretary-General Antonio Guterres said.
"This action includes a transformative SDG stimulus package, generated through the collective and concerted efforts of all stakeholders," he added.
China is projected to grow at 4.8 per cent in calendar year 2023 and 4.5 per cent in 2024, while the US is estimated to register a 0.4 per cent economic growth this year and 1.7 per cent in 2024.
Directions of trade in Russia have markedly changed since the war started, the report said adding that although Russian oil has been redirected to Asia and sold at a discount price, the total value of exports increased in 2022 as trade with China, India and Turkiye surged.
The current account surplus of Russia in the first three quarters of 2022 amounted to USD 198 billion versus USD 122 billion for 2021 as a whole.
The report said that amid high inflation, aggressive monetary tightening and heightened uncertainties, the current downturn has slowed the pace of economic recovery from the COVID-19 crisis, threatening several countries - both developed and developing - with the prospects of recession in 2023.
Growth momentum significantly weakened in the United States, the European Union and other developed economies in 2022, adversely impacting the rest of the global economy through a number of channels.
In India, annual inflation is estimated at 7.1 per cent in 2022, exceeding the 2 to 6 per cent medium-term inflation target band set by the Central Bank. India's inflation is expected to decelerate to 5.5 per cent in 2023 as global commodity prices moderate and slower currency depreciation eases imported inflation.
Most developing countries have seen a slower job recovery in 2022 and continue to face considerable employment slack. Disproportionate losses in women's employment during the initial phase of the pandemic have not been fully reversed, with improvements mainly arising from a recovery in informal jobs, the report said.
Recovery in the labour market has been uneven across the region. The report said that among the large economies, the unemployment rate dropped to a four-year low of 6.4 per cent in India, as the economy added jobs both in urban and rural areas in 2022.
"In India, the unemployment rate in 2022 declined to pre-pandemic levels through stepped-up urban and rural employment. But youth employment remained below pre-pandemic levels, particularly among young women, given the pandemic's severe impacts on economic sectors where women tend to cluster," it said.
The report calls for governments to avoid fiscal austerity which would stifle growth and disproportionately affect the most vulnerable groups, affect progress in gender equality and stymie development prospects across generations. It recommends reallocation and reprioritization of public expenditures through direct policy interventions that will create jobs and reinvigorate growth. This will require strengthening of social protection systems, ensuring continued support through targeted and temporary subsidies, cash transfers, and discounts on utility bills, which can be complemented with reductions in consumption taxes or custom duties, it said.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Tuesday, January 24, 2023
Airtel Raises Basic Tariffs By Nearly 57% In Seven Regions
Bharti Airtel, India's No. 2 telecom carrier by subscribers, has introduced a new entry level plan at Rs 155 in seven regions, the company's spokesperson said on Tuesday, effectively raising basic tariffs by nearly 57%.
The new plan was introduced in regions including the states of Karnataka, Bihar and Rajasthan, after discontinuing the existing tariffs of 99 rupees, the spokesperson added.
The company had late last year introduced the new plan on a trial basis in Odisha and Haryana.
Telecom firms were widely expected to hike tariffs to shore up revenues after having spent billions of dollars in the 5G auction last year.
Airtel's average revenue per user (ARPU), a key performance indicator for telecom firms, was 190 rupees in the September-quarter, a 3.8% sequential rise and a roughly 24% year-on-year increase.
The ARPU needed to be at 200 rupees and ultimately at 300 rupees for a financially healthy business model, Airtel said in November 2021, when it last raised tariffs.
Larger rival Reliance Jio, the telecom arm of billionaire Mukesh Ambani's Reliance Industries, had ARPU at 177.2 rupees in the September quarter which rose slightly to 178.2 rupees in the December quarter.
Jio, which disrupted the industry with cut-price rates in 2016, has not yet raised tariffs in over a year.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Airtel Raises Basic Tariffs By Nearly 57% In Seven Regions
Bharti Airtel, India's No. 2 telecom carrier by subscribers, has introduced a new entry level plan at Rs 155 in seven regions, the company's spokesperson said on Tuesday, effectively raising basic tariffs by nearly 57%.
The new plan was introduced in regions including the states of Karnataka, Bihar and Rajasthan, after discontinuing the existing tariffs of 99 rupees, the spokesperson added.
The company had late last year introduced the new plan on a trial basis in Odisha and Haryana.
Telecom firms were widely expected to hike tariffs to shore up revenues after having spent billions of dollars in the 5G auction last year.
Airtel's average revenue per user (ARPU), a key performance indicator for telecom firms, was 190 rupees in the September-quarter, a 3.8% sequential rise and a roughly 24% year-on-year increase.
The ARPU needed to be at 200 rupees and ultimately at 300 rupees for a financially healthy business model, Airtel said in November 2021, when it last raised tariffs.
Larger rival Reliance Jio, the telecom arm of billionaire Mukesh Ambani's Reliance Industries, had ARPU at 177.2 rupees in the September quarter which rose slightly to 178.2 rupees in the December quarter.
Jio, which disrupted the industry with cut-price rates in 2016, has not yet raised tariffs in over a year.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Monday, January 23, 2023
Sunday, January 22, 2023
G20's 3-Day Business20 Inception Meeting Begins In Gujarat
Several policymakers, including Commerce and Industry Minister Piyush Goyal besides business leaders and senior executives representing businesses of the G20 countries are participating in the three-day B20 India inception meeting, which commenced here on Sunday.
As India holds the presidency of G20 in 2023, it will host the 18th G20 Summit in September. The Business 20 (B20) is amongst the most prominent official engagement groups in G20, with companies, business associations and multilateral organizations as participants.
The G20 or Group of 20 is an intergovernmental forum of the world's major developed and developing economies. It comprises Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the UK, the US, and the European Union (EU).
The Confederation of Indian Industry (CII) has been formally designated as the B20 secretariat by Government of India to lead and host B20 during India's G20 presidency.
"The inception meeting will bring together several policymakers, thought leaders, business leaders, CEOs and senior executives representing businesses of the G20 countries along with the presence of the representatives of several multilateral organisations, stimulating enriching discussions and deliberations on the business agenda under B20 India," CII said in a statement.
B20 India will work through seven task forces and two action councils.
During the course of the presidency, B20 India will host a series of discussions and policy advocacy initiatives, across India, covering the identified industry priorities, with the aim to realize the B20 strategic vision and translating it into concrete and actionable policy recommendations, it added.
"Out of the many initiatives planned by the B20 India Secretariat, the inception meeting officially inaugurates the presidency work of all the task forces and action councils under B20 India," it added.
The subject of seven task forces include digital transformation; tech, innovation and R&D; inclusive global value chains for resilient global trade and investment; financing for global economic recovery; and energy, climate change and resource efficiency.
On Monday, prominent business leaders who would address include N Chandrasekaran, Chair, B20 India and Tata Sons Chairman; Bajaj Finserv Ltd CMD Sanjiv Bajaj; and Vice Chairman & President, Strategic Growth, Mastercard Michael Froman.
Collectively, G20 accounts for 85 per cent of the global GDP, 75 per cent of international trade, and two-thirds of the world population, making it the premier forum for international economic cooperation.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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G20's 3-Day Business20 Inception Meeting Begins In Gujarat
Several policymakers, including Commerce and Industry Minister Piyush Goyal besides business leaders and senior executives representing businesses of the G20 countries are participating in the three-day B20 India inception meeting, which commenced here on Sunday.
As India holds the presidency of G20 in 2023, it will host the 18th G20 Summit in September. The Business 20 (B20) is amongst the most prominent official engagement groups in G20, with companies, business associations and multilateral organizations as participants.
The G20 or Group of 20 is an intergovernmental forum of the world's major developed and developing economies. It comprises Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the UK, the US, and the European Union (EU).
The Confederation of Indian Industry (CII) has been formally designated as the B20 secretariat by Government of India to lead and host B20 during India's G20 presidency.
"The inception meeting will bring together several policymakers, thought leaders, business leaders, CEOs and senior executives representing businesses of the G20 countries along with the presence of the representatives of several multilateral organisations, stimulating enriching discussions and deliberations on the business agenda under B20 India," CII said in a statement.
B20 India will work through seven task forces and two action councils.
During the course of the presidency, B20 India will host a series of discussions and policy advocacy initiatives, across India, covering the identified industry priorities, with the aim to realize the B20 strategic vision and translating it into concrete and actionable policy recommendations, it added.
"Out of the many initiatives planned by the B20 India Secretariat, the inception meeting officially inaugurates the presidency work of all the task forces and action councils under B20 India," it added.
The subject of seven task forces include digital transformation; tech, innovation and R&D; inclusive global value chains for resilient global trade and investment; financing for global economic recovery; and energy, climate change and resource efficiency.
On Monday, prominent business leaders who would address include N Chandrasekaran, Chair, B20 India and Tata Sons Chairman; Bajaj Finserv Ltd CMD Sanjiv Bajaj; and Vice Chairman & President, Strategic Growth, Mastercard Michael Froman.
Collectively, G20 accounts for 85 per cent of the global GDP, 75 per cent of international trade, and two-thirds of the world population, making it the premier forum for international economic cooperation.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Saturday, January 21, 2023
Adani Group To Spin Off Hydrogen, Airports, Data Centre Businesses By 2028
Billionaire Gautam Adani's group plans to spin off businesses like hydrogen, airports and data centre between 2025 and 2028 after they achieve a certain investment profile, it's Chief Financial Officer Jugeshinder Singh said.
Adani Enterprises Ltd, which is looking to raise Rs 20,000 crore in a follow-on share sale, is the business incubator for the group. Over the years, businesses such as ports, power and city gas were first incubated in AEL before being spun off or demerged into separate listed companies.
AEL currently houses new businesses such as hydrogen, where the group plans to invest USD 50 billion over the next 10 years across the value chain, flourishing airport operations, mining, data centre and roads and logistics.
"The businesses have to achieve a basic investment profile and maturity before being considered for a demerger. Between 2025 and 2028 we think these businesses can achieve the desired levels for a demerger," Mr Singh told PTI.
The group is looking to become one of the lowest cost producers of hydrogen -- a fuel of the future that has zero carbon footprint. It is also betting big on its airport business with an aim to become the largest service base in the country in the coming years, outside of government services.
Mr Adani, 60, started as a trader and has been on a rapid diversification spree, expanding an empire centred on ports and coal mining to include airports, data centres and cement as well as green energy. He now owns a media company too.
Jugeshinder Singh said the follow-on share sale is aimed at widening the shareholder base by bringing in more retail, high networth and institutional investors.
This would also address concerns of liquidity by increasing the free float, he said, adding the company wants to increase the participation of retail investors and that is why it chose a primary issue instead of a rights issue.
AEL will use the money raised to fund green hydrogen projects, airport facilities and greenfield expressways, besides paring some of its debt.
It will sell shares in a price band of Rs 3,112 to Rs 3,276 apiece in the follow-on public offer (FPO), slated to open on January 27 and close on January 31, according to the offer letter.
Of the Rs 20,000 crore proceeds of the FPO, Rs 10,869 crore will be used for green hydrogen projects, work at the existing airports and construction of a greenfield expressway. Another Rs 4,165 crore will go towards repayment of debt taken by its airports, road and solar project subsidiaries.
AEL has been the vehicle for most of the new business expansion of Adani.
Its current business portfolio includes a green hydrogen ecosystem, data centres, developing airports, developing roads, food FMCG, digital, mining, defence and industrial manufacturing, among others.
As of September 30, 2022, it had Rs 40,023.50 crore in borrowing.
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Adani Group To Spin Off Hydrogen, Airports, Data Centre Businesses By 2028
Billionaire Gautam Adani's group plans to spin off businesses like hydrogen, airports and data centre between 2025 and 2028 after they achieve a certain investment profile, it's Chief Financial Officer Jugeshinder Singh said.
Adani Enterprises Ltd, which is looking to raise Rs 20,000 crore in a follow-on share sale, is the business incubator for the group. Over the years, businesses such as ports, power and city gas were first incubated in AEL before being spun off or demerged into separate listed companies.
AEL currently houses new businesses such as hydrogen, where the group plans to invest USD 50 billion over the next 10 years across the value chain, flourishing airport operations, mining, data centre and roads and logistics.
"The businesses have to achieve a basic investment profile and maturity before being considered for a demerger. Between 2025 and 2028 we think these businesses can achieve the desired levels for a demerger," Mr Singh told PTI.
The group is looking to become one of the lowest cost producers of hydrogen -- a fuel of the future that has zero carbon footprint. It is also betting big on its airport business with an aim to become the largest service base in the country in the coming years, outside of government services.
Mr Adani, 60, started as a trader and has been on a rapid diversification spree, expanding an empire centred on ports and coal mining to include airports, data centres and cement as well as green energy. He now owns a media company too.
Jugeshinder Singh said the follow-on share sale is aimed at widening the shareholder base by bringing in more retail, high networth and institutional investors.
This would also address concerns of liquidity by increasing the free float, he said, adding the company wants to increase the participation of retail investors and that is why it chose a primary issue instead of a rights issue.
AEL will use the money raised to fund green hydrogen projects, airport facilities and greenfield expressways, besides paring some of its debt.
It will sell shares in a price band of Rs 3,112 to Rs 3,276 apiece in the follow-on public offer (FPO), slated to open on January 27 and close on January 31, according to the offer letter.
Of the Rs 20,000 crore proceeds of the FPO, Rs 10,869 crore will be used for green hydrogen projects, work at the existing airports and construction of a greenfield expressway. Another Rs 4,165 crore will go towards repayment of debt taken by its airports, road and solar project subsidiaries.
AEL has been the vehicle for most of the new business expansion of Adani.
Its current business portfolio includes a green hydrogen ecosystem, data centres, developing airports, developing roads, food FMCG, digital, mining, defence and industrial manufacturing, among others.
As of September 30, 2022, it had Rs 40,023.50 crore in borrowing.
Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group Company.
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Yes Bank Reports Surprise 80% Plunge In Quarterly Profit
Yes Bank reported a surprise 80% plunge in quarterly profit on Saturday as provisions for bad loans increased.
Net profit fell to 515.20 million rupees ($6.36 million) for the three months through December from 2.66 billion rupees in the same period a year earlier. Analysts had expected profit to rise to 3.36 billion rupees, according to Refinitiv IBES data.
But net interest margin, a key indicator of a bank's profitability, rose 10 basis points to 2.5%.
The bank's asset quality improved as gross non-performing assets declined to 2.02% of total loans from 12.89% in the September quarter. Net non-performing assets declined to 1.03% from 3.60%.
Net interest income, the difference between the interest income from lending and that paid to depositors rose 11.7% to 19.71 billion rupees.
Provisions increased to 8.44 billion rupees from 5.82 billion rupees the previous quarter.
Yes Bank in December completed the transfer of bad loans worth 480 billion rupees to private equity firm J.C. Flowers, in a deal aimed at cleaning up its balance sheet.
The lender's loan growth improved by 10% while deposits rose 16%.
This is contrary to the trend in the country's banking industry. Bank loans rose nearly 15% in the fortnight to Dec. 30 from a year earlier, outpacing a 9.2% increase in deposits, according to the latest data from the Reserve Bank of India (RBI).
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Yes Bank Reports Surprise 80% Plunge In Quarterly Profit
Yes Bank reported a surprise 80% plunge in quarterly profit on Saturday as provisions for bad loans increased.
Net profit fell to 515.20 million rupees ($6.36 million) for the three months through December from 2.66 billion rupees in the same period a year earlier. Analysts had expected profit to rise to 3.36 billion rupees, according to Refinitiv IBES data.
But net interest margin, a key indicator of a bank's profitability, rose 10 basis points to 2.5%.
The bank's asset quality improved as gross non-performing assets declined to 2.02% of total loans from 12.89% in the September quarter. Net non-performing assets declined to 1.03% from 3.60%.
Net interest income, the difference between the interest income from lending and that paid to depositors rose 11.7% to 19.71 billion rupees.
Provisions increased to 8.44 billion rupees from 5.82 billion rupees the previous quarter.
Yes Bank in December completed the transfer of bad loans worth 480 billion rupees to private equity firm J.C. Flowers, in a deal aimed at cleaning up its balance sheet.
The lender's loan growth improved by 10% while deposits rose 16%.
This is contrary to the trend in the country's banking industry. Bank loans rose nearly 15% in the fortnight to Dec. 30 from a year earlier, outpacing a 9.2% increase in deposits, according to the latest data from the Reserve Bank of India (RBI).
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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Friday, January 20, 2023
Here's How India's Top Renewable Energy Stocks Will Perform In 2023
Last year we wrote to you about what to expect from India's top renewable energy stocks in 2022.
We mentioned the leading companies in the space and their plans in the coming years.
The renewable energy (RE) theme has picked up with India quickly becoming one of the world leaders in embracing the transition to renewable energy.
The country is combating climate change head-on. What started as a renewable energy target of 225 GW by 2022, was upgraded to 450 GW by 2030, and eventually to 50% of the country's energy being derived through renewable means by 2030.
This was complemented by earnest policy reforms. In a decisive move, the Indian government implemented customs tariff of 40% on solar energy modules and 25% on solar energy cells, providing the domestic sector empowering the sector to achieve scale, economy, and export competitiveness.
These ambitious targets are backed by actual announcements made by some of the top business houses in the country. This includes commitments by state-owned NTPC at 60 GW, Adani Green Energy at 45 GW and Tata Power, ReNew Power, and Acme Solar at 25 GW each.
As of March 2022, India's renewable energy capacity stood at 156.61 GW, representing 39.2% of the overall installed power capacity and providing a great opportunity for the expansion of green data centres.
Solar energy was the biggest contributor in the total renewable energy capacity addition with a share of 34.5% followed by wind with a 25.8% share.
The renewable sector added more new capacity than conventional energy sector in 2022 for the fourth year in a row, clean energy accounting for close to half of the total installed energy capacity in the country.
While solar and wind energy sources were the frontrunners in the renewable energy race, green hydrogen has garnered a lot of attention lately.
There is growing excitement that green hydrogen could be the fuel of the future, backed by renewable energy. This offers tremendous potential for growth and is quickly turning into an investing megatrend.
It has reached a point where economic progress over the next century, may just be defined by climate investments. This bodes well for the companies leading the renewable energy race.
However, investing in companies generating renewable energy is not the only way to ride this wave. You can also look at the original equipment manufacturers (OEMs) who also stand to benefit tremendously, offering robust returns.
Last time we spoke about Websol Energy and Sterling Wilson Solar. While these names are still relevant we have added more to the list.
So, with this in mind, we highlight the renewed list of the top 3 renewable energy stocks and what you can expect from them in 2023.
#1 Websol Energy
First on our list is Websol Energy.
Websol Energy is a leading manufacturer of photovoltaic monocrystalline solar cells and modules in India.
When we last wrote the piece the company was well on its way to expand its capacity in 2022. While the expansion plans are still on track the company intends to more than seven-fold their existing capacity (around 250 MW) to retain its position as one of the largest producers of solar cells in India.
Moreover, it has outlined ambitious plans to mobilise funds for upgrading its existing equipment with the latest and most efficient technology. This places the company well to profit from the green energy revolution.
Websol went into business as a fully export-oriented unit catering to Europe (mainly Germany and Italy) and the US. They have been in this business for over two decades now and enjoy a reputation for high-quality products. They offer a wide array of products ranging from 5 W to 220 W, catering to the demands of home, commercial and industrial institutions.
While the company has grown its sales by 38.8% in the last year the net profit dropped 80%. But this is an aberration as margins didn't fall much in the financial year 2022. However, the company's profits were higher in the financial year 2021 due to a one-time exceptional item which make 2022 look bad. The balance sheet is well funded with negligible debt on the books.
The company's patchy past performance is largely owing to weak power demand, intense competition from China and the pandemic.
Now, with the ongoing capacity expansion, the company is unlikely to churn out a profit in the near term. However, this should be temporary, considering the new capacity will make them highly efficient and well-poised to benefit from this investing megatrend.
#2 Sterling and Wilson
Next on our list the same company we mentioned in our previous piece, Sterling and Wilson Solar.
Sterling and Wilson Solar is a global holistic solar engineering, procurement, and construction (EPC) solutions provider with a wide presence across 26 countries.
The company's unexecuted EPC order book stood at Rs.26 bn as of October 2022, with nearly 78% domestic EPC, indicating healthy growth in business in the coming year. The domestic business offers wider margins and is likely to boost profits. This in tandem with sliding input costs bodes well for the company in the coming years.
Back when we wrote the previous article, the company had two large EPC projects with a total capacity of 400 MW are being constructed in the US.
However, that activity had stalled considerably in 1HCY22 due to Department of Commerce investigation on import of modules. But the new directive in June 2022 has given relief to module imports allowing the company to continue its work.
Sterling and Wilson Solar added significant capacity which will come online by the end of the financial year 2023. Moreover, it's expanding its renewable energy offerings to include EPC solutions for hybrid energy power plants, energy storage and waste to energy.
Acquired by Reliance in 2021 (40% stake), the company provides EPC services primarily for utility-scale solar power projects. It has executed projects of more than 10 GW capacity across geographies including Australia, USA, Asia, Africa, and the Middle East. International operations account for more than 80% of the total revenues.
The unprecedented commodity super cycle over the last two years coupled with covid led to Solar Industry suffering huge losses and IPP's deferring projects. The sales and gross profit growth in the past year was 2.3% and 38% respectively. The company is incurring a loss at the net level.
However, this is likely to change with the fresh set of announcements. The solar installations have grown at 15% CAGR in the past 5 years and are likely to replicate the same going forward.
Moreover, the company's strong balance sheet will also assist it grow further.
#3 Borosil Renewables
The third company on our list is a new entrant, Borosil Renewables. Borosil Renewables is the first and only solar glass manufacturer in India.
The company has chalked out an expansion plan which will take its Indian capacity of 450 TPD (tonnes per day) to 1,000 TPD by October 2022 and 2,100 TPD by the financial year ending 2025. This will result in a capital outlay of around Rs 15 bn.
Moreover, it recently acquired the Interfloat group, the largest manufacturer of solar glass in Europe, with an operational manufacturing capacity of 300 TPD in Germany. They plan to increase this to 500 TPD by 2023. While this may seem ambitious, the company has achieved such a feat.
Borosil Renewables, part of the six decades old Borosil Group, commissioned its first solar glass manufacturing facility at Baruch in Gujarat in January 2010 with 180 TPD capacity. This was expanded to 450 TPD or 2.8 GW of solar modules. The current capacity can power up to 2.5 gigawatts (GW) of solar power.
In the solar panel glass business, Borosil meets 40% of the domestic demand of 650 tonnes of glasses per day, while the rest is imported from China and Malaysia. Apart from fulfilling the country's growing demand for solar glass, the company also ships to Germany Poland, Canada, the US, Mexico, and the Middle East. This comprises almost 20% of its present solar panel glass capacity.
The sales have grown by 28% in the past year, recovering well from the slowdown due to the pandemic. However, the profits have skyrocketed, doubling in the same period. The strong profitability has boosted the return on equity. It's up from 14% in the financial year 2021 to 21% in the financial year 2022.
The company boasts a strong balance sheet with low debt-to-equity of 0.2 times. The interest coverage ratio is very high at 79.5 times in the financial year 2022.
In conclusion
The renewable energy sector continues to remain a favourite among industrialists and investors across the world. The high ticket investments have placed the sector, and the companies operating in it, on the fast track to growth in the coming years.
The plans of a company are a great insight into its long-term vision. It helps in analysing and understanding the steps it would take to achieve the same.
Therefore, an investor must pay extra attention to these plans. Analyse them well to comprehend whether the company's roadmap is feasible or not. Only then can you make the right choice.
Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such.
This article is syndicated from Equitymaster.com
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Here's How India's Top Renewable Energy Stocks Will Perform In 2023
Last year we wrote to you about what to expect from India's top renewable energy stocks in 2022.
We mentioned the leading companies in the space and their plans in the coming years.
The renewable energy (RE) theme has picked up with India quickly becoming one of the world leaders in embracing the transition to renewable energy.
The country is combating climate change head-on. What started as a renewable energy target of 225 GW by 2022, was upgraded to 450 GW by 2030, and eventually to 50% of the country's energy being derived through renewable means by 2030.
This was complemented by earnest policy reforms. In a decisive move, the Indian government implemented customs tariff of 40% on solar energy modules and 25% on solar energy cells, providing the domestic sector empowering the sector to achieve scale, economy, and export competitiveness.
These ambitious targets are backed by actual announcements made by some of the top business houses in the country. This includes commitments by state-owned NTPC at 60 GW, Adani Green Energy at 45 GW and Tata Power, ReNew Power, and Acme Solar at 25 GW each.
As of March 2022, India's renewable energy capacity stood at 156.61 GW, representing 39.2% of the overall installed power capacity and providing a great opportunity for the expansion of green data centres.
Solar energy was the biggest contributor in the total renewable energy capacity addition with a share of 34.5% followed by wind with a 25.8% share.
The renewable sector added more new capacity than conventional energy sector in 2022 for the fourth year in a row, clean energy accounting for close to half of the total installed energy capacity in the country.
While solar and wind energy sources were the frontrunners in the renewable energy race, green hydrogen has garnered a lot of attention lately.
There is growing excitement that green hydrogen could be the fuel of the future, backed by renewable energy. This offers tremendous potential for growth and is quickly turning into an investing megatrend.
It has reached a point where economic progress over the next century, may just be defined by climate investments. This bodes well for the companies leading the renewable energy race.
However, investing in companies generating renewable energy is not the only way to ride this wave. You can also look at the original equipment manufacturers (OEMs) who also stand to benefit tremendously, offering robust returns.
Last time we spoke about Websol Energy and Sterling Wilson Solar. While these names are still relevant we have added more to the list.
So, with this in mind, we highlight the renewed list of the top 3 renewable energy stocks and what you can expect from them in 2023.
#1 Websol Energy
First on our list is Websol Energy.
Websol Energy is a leading manufacturer of photovoltaic monocrystalline solar cells and modules in India.
When we last wrote the piece the company was well on its way to expand its capacity in 2022. While the expansion plans are still on track the company intends to more than seven-fold their existing capacity (around 250 MW) to retain its position as one of the largest producers of solar cells in India.
Moreover, it has outlined ambitious plans to mobilise funds for upgrading its existing equipment with the latest and most efficient technology. This places the company well to profit from the green energy revolution.
Websol went into business as a fully export-oriented unit catering to Europe (mainly Germany and Italy) and the US. They have been in this business for over two decades now and enjoy a reputation for high-quality products. They offer a wide array of products ranging from 5 W to 220 W, catering to the demands of home, commercial and industrial institutions.
While the company has grown its sales by 38.8% in the last year the net profit dropped 80%. But this is an aberration as margins didn't fall much in the financial year 2022. However, the company's profits were higher in the financial year 2021 due to a one-time exceptional item which make 2022 look bad. The balance sheet is well funded with negligible debt on the books.
The company's patchy past performance is largely owing to weak power demand, intense competition from China and the pandemic.
Now, with the ongoing capacity expansion, the company is unlikely to churn out a profit in the near term. However, this should be temporary, considering the new capacity will make them highly efficient and well-poised to benefit from this investing megatrend.
#2 Sterling and Wilson
Next on our list the same company we mentioned in our previous piece, Sterling and Wilson Solar.
Sterling and Wilson Solar is a global holistic solar engineering, procurement, and construction (EPC) solutions provider with a wide presence across 26 countries.
The company's unexecuted EPC order book stood at Rs.26 bn as of October 2022, with nearly 78% domestic EPC, indicating healthy growth in business in the coming year. The domestic business offers wider margins and is likely to boost profits. This in tandem with sliding input costs bodes well for the company in the coming years.
Back when we wrote the previous article, the company had two large EPC projects with a total capacity of 400 MW are being constructed in the US.
However, that activity had stalled considerably in 1HCY22 due to Department of Commerce investigation on import of modules. But the new directive in June 2022 has given relief to module imports allowing the company to continue its work.
Sterling and Wilson Solar added significant capacity which will come online by the end of the financial year 2023. Moreover, it's expanding its renewable energy offerings to include EPC solutions for hybrid energy power plants, energy storage and waste to energy.
Acquired by Reliance in 2021 (40% stake), the company provides EPC services primarily for utility-scale solar power projects. It has executed projects of more than 10 GW capacity across geographies including Australia, USA, Asia, Africa, and the Middle East. International operations account for more than 80% of the total revenues.
The unprecedented commodity super cycle over the last two years coupled with covid led to Solar Industry suffering huge losses and IPP's deferring projects. The sales and gross profit growth in the past year was 2.3% and 38% respectively. The company is incurring a loss at the net level.
However, this is likely to change with the fresh set of announcements. The solar installations have grown at 15% CAGR in the past 5 years and are likely to replicate the same going forward.
Moreover, the company's strong balance sheet will also assist it grow further.
#3 Borosil Renewables
The third company on our list is a new entrant, Borosil Renewables. Borosil Renewables is the first and only solar glass manufacturer in India.
The company has chalked out an expansion plan which will take its Indian capacity of 450 TPD (tonnes per day) to 1,000 TPD by October 2022 and 2,100 TPD by the financial year ending 2025. This will result in a capital outlay of around Rs 15 bn.
Moreover, it recently acquired the Interfloat group, the largest manufacturer of solar glass in Europe, with an operational manufacturing capacity of 300 TPD in Germany. They plan to increase this to 500 TPD by 2023. While this may seem ambitious, the company has achieved such a feat.
Borosil Renewables, part of the six decades old Borosil Group, commissioned its first solar glass manufacturing facility at Baruch in Gujarat in January 2010 with 180 TPD capacity. This was expanded to 450 TPD or 2.8 GW of solar modules. The current capacity can power up to 2.5 gigawatts (GW) of solar power.
In the solar panel glass business, Borosil meets 40% of the domestic demand of 650 tonnes of glasses per day, while the rest is imported from China and Malaysia. Apart from fulfilling the country's growing demand for solar glass, the company also ships to Germany Poland, Canada, the US, Mexico, and the Middle East. This comprises almost 20% of its present solar panel glass capacity.
The sales have grown by 28% in the past year, recovering well from the slowdown due to the pandemic. However, the profits have skyrocketed, doubling in the same period. The strong profitability has boosted the return on equity. It's up from 14% in the financial year 2021 to 21% in the financial year 2022.
The company boasts a strong balance sheet with low debt-to-equity of 0.2 times. The interest coverage ratio is very high at 79.5 times in the financial year 2022.
In conclusion
The renewable energy sector continues to remain a favourite among industrialists and investors across the world. The high ticket investments have placed the sector, and the companies operating in it, on the fast track to growth in the coming years.
The plans of a company are a great insight into its long-term vision. It helps in analysing and understanding the steps it would take to achieve the same.
Therefore, an investor must pay extra attention to these plans. Analyse them well to comprehend whether the company's roadmap is feasible or not. Only then can you make the right choice.
Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such.
This article is syndicated from Equitymaster.com
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Thursday, January 19, 2023
Wednesday, January 18, 2023
Gautam Adani Discounts India's Biggest Follow-On Share Sale by 10%-15%
Gautam Adani's flagship is offering investors discounts of 10 per cent-15 per cent in India's biggest follow-on share sale as the billionaire tries to woo a wider set of backers.
Adani Enterprises Ltd. is seeking to raise $2.5 billion by selling shares in a price band of Rs 3,112 to Rs 3,276 a piece, according to an exchange filing Wednesday. Bloomberg News reported earlier that large investors would get a concession of 10 per cent on the current market price while retail investors would pay even less to buy into a company that has almost doubled in market value over the past year.
Roughly half the money will go toward expanding Adani's airport and renewable energy projects, while some 42 billion rupees - a little less than a quarter of the amount raised - will be used to pare debt, the company said in its prospectus filed earlier on Wednesday. Anchor investors can bid on January 25 and the rest from January 27 to January 31.
In a rare move for a follow-on sale, Asia's richest man will allow investors to pay for their purchases in tranches. Bidders will have to pay 50 per cent of the offer price as upfront payment, followed by one or two installments of the remaining sum. Retail investors would get a discount of 64 rupees per share.
The massive share sale would help Mr Adani meet multiple goals. Broadening his investor base would fend off allegations that his empire comprises mainly thinly traded stocks; repaying debt addresses concerns about overleverage; and winning over mom-and-pop investors would cement Mr Adani's legacy as a wealth creator in a nation with widening income inequality.
Adani Enterprises' shares have surged 95 per cent over the past year to Rs 3,596.7. The stock is trading at a valuation of over 141 times its one-year forward earnings. By comparison, Reliance Industries Ltd. - India's largest firm by market value - is at about 20 times, according to data compiled by Bloomberg.
"We have done strategic capital. The next capital is patient capital," Chief Financial Officer Jugeshinder Singh had said in an interview in November. "Indian mom and pop investors invest for their children and grand children."
Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group Company.
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Gautam Adani Discounts India's Biggest Follow-On Share Sale by 10%-15%
Gautam Adani's flagship is offering investors discounts of 10 per cent-15 per cent in India's biggest follow-on share sale as the billionaire tries to woo a wider set of backers.
Adani Enterprises Ltd. is seeking to raise $2.5 billion by selling shares in a price band of Rs 3,112 to Rs 3,276 a piece, according to an exchange filing Wednesday. Bloomberg News reported earlier that large investors would get a concession of 10 per cent on the current market price while retail investors would pay even less to buy into a company that has almost doubled in market value over the past year.
Roughly half the money will go toward expanding Adani's airport and renewable energy projects, while some 42 billion rupees - a little less than a quarter of the amount raised - will be used to pare debt, the company said in its prospectus filed earlier on Wednesday. Anchor investors can bid on January 25 and the rest from January 27 to January 31.
In a rare move for a follow-on sale, Asia's richest man will allow investors to pay for their purchases in tranches. Bidders will have to pay 50 per cent of the offer price as upfront payment, followed by one or two installments of the remaining sum. Retail investors would get a discount of 64 rupees per share.
The massive share sale would help Mr Adani meet multiple goals. Broadening his investor base would fend off allegations that his empire comprises mainly thinly traded stocks; repaying debt addresses concerns about overleverage; and winning over mom-and-pop investors would cement Mr Adani's legacy as a wealth creator in a nation with widening income inequality.
Adani Enterprises' shares have surged 95 per cent over the past year to Rs 3,596.7. The stock is trading at a valuation of over 141 times its one-year forward earnings. By comparison, Reliance Industries Ltd. - India's largest firm by market value - is at about 20 times, according to data compiled by Bloomberg.
"We have done strategic capital. The next capital is patient capital," Chief Financial Officer Jugeshinder Singh had said in an interview in November. "Indian mom and pop investors invest for their children and grand children."
Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group Company.
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Tuesday, January 17, 2023
Cryptoverse: Bitcoin Springs Back In 2023, Jumps 26% In January
Bitcoin is on the charge in 2023, dragging the crypto market off the floor and electrifying bonk, a new meme coin.
The No.1 cryptocurrency has clocked a 26% gain in January, leaping 22% in the past week alone, breaking back above the $20,000 level and putting in on course for its best month since October 2021 - just before the Big Crypto Crash.
Ether has also risen, by 29% this year, helping drive the value of the overall global cryptocurrency market above $1 trillion, according to CoinGecko.
"After a rough year last year for cryptos, we are seeing a form of mean reversion," said Jake Gordon, analyst at Bespoke Investment Group, referring to the theory of asset prices returning to long-term averages.
Researchers said investor bets on a rosier macroeconomic picture were driving a jump in riskier assets across the board.
Few crypto tokens have benefited more than bonk, which was launched at the end of December on the Solana blockchain and had rocketed 5,000% by early January. It has since fallen back, though remains up 910% since the start of the year.
It is the latest entrant to the hyper-volatile world of meme coins, cryptocurrencies inspired by online memes and jokes, and is modeled after the same grinning Shiba Inu dog as dogecoin - which itself was catapulted to fame by Elon Musk tweets.
Bonk's a puppy, though.
Even at its peak it was worth just $0.000004873759 with a market capitalization of about $205 million.
Other meme tokens are also up, with dogecoin and Shiba Inu up 19% and 27% respectively in 2023.
But buyers beware.
"Investors need to be especially cautious when it comes to coins like doge, Shiba Inu and bonk," said Les Borsai, co-founder of digital assets services firm Wave Financial.
"They fall just as hard as they surge."
Nonetheless, some market players pointed to the relative cheapness of these tokens - doge is worth about eight cents - as a reason why speculators were willing to place bets on them.
"Meme coins belong to crypto, it's part of the culture," said Martin Leinweber, digital assets product specialist at MarketVector Indexes. "It just takes a few lines of codes to create a meme token and if you have a community for it, people love that."
RUMORS OF SOL'S DEATH EXAGGERATED
Bonk is a meme coin with a mission. It was created, in part, to support the Solana blockchain, which has seen an exodus of funds and users since crypto exchange FTX filed for bankruptcy in November, and its native Solana token drop over 37%.
The Solana token has now indeed jumped as bonk has gained traction: it's up 131% in 2023, the biggest gainer among major cryptocurrencies.
"Rumors of Solana's death seem to have been greatly exaggerated," said Tom Dunleavy, senior research analyst at data firm Messari. "Despite the recent price appreciation seemingly being driven by speculation, the underlying ecosystem remains quite strong."
TOO EARLY TO CALL A CRYPTO REVERSAL
Some researchers chalked the crypto gains up to optimism that inflation had peaked, reducing the need for tighter central bank policy.
"Bitcoin and crypto tend to front-run everything, which is why we've seen notable relative strength in this asset class of late," said Wave Financial's Borsai.
There's certainly been an increase in activity.
The dollar value of bitcoin trading volumes on major exchanges over a 7-day period jumped to $151 million, the highest in nearly two months, according to data from Blockchain.com.
Total bitcoin flows - representing all uses including trading and payments - have increased by 13,130 bitcoin on average in the last 7 days, the largest rise in 64 days, Chainalysis data showed.
However, market watchers warned against celebrating too soon, noting trading volumes remained low and the macroeconomic environment uncertain.
"It's too early to declare a definitive reversal for the crypto market despite the recent strength we've seen of late," said Aaron Kaplan, co-founder of Prometheum, a digital asset securities trading platform.
"If interest rate increases are below what the market expects, then risk assets will benefit and crypto prices will likely continue the uptrend, but there's just too much uncertainty right now."
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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