IndUS Business Journal

Manufacturing sector decelerates India’s March industrial output

May 11, 2018 0

New Delhi– Lower manufacturing production decelerated India’s industrial output in March to 4.4 per cent from a rise of 7 per cent in February 2018, official data showed on Friday.

As per the data released by the Central Statistics Office (CSO), on a year-on-year (YoY) basis, the index value remained unchanged. IIP had edged higher by 4.4 per cent in May 2017.

Besides, the data showed that the sequential slowdown in factory output was mainly on account of lower production in the manufacturing sector. (IANS)

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Fortis ‘chose Munjal-Burman for funds certainty’, Manipal feels let down

May 11, 2018 0

New Delhi/Gurugram– The decision by the Fortis Healthcare board to recommend the offer of the Hero and Burman family consortium for sale of its business to the shareholders for approval later this month was primarily guided by the certainty of liquidity flowing in to enable greater efficiency, a top Fortis official said on Friday.

However, other contenders expressed their disappointment over the same.

Following a board meeting here that lasted till late on Thursday, Fortis said its board had decided to recommend the offer of Hero Enterprise Investment Office-Burman Family Office to its shareholders.

“The Board, by a majority, decided to recommend the Hero-Burman family offer to shareholders looking at the binding bids for the point of certainty of liquidity flowing into the company,” Fortis Director Brian Tempest told reporters.

“After many months of engagement with Fortis, including due diligence, we are disappointed that the board has come to this conclusion. Manipal remains of the view that our offer proposed the most appropriate short and long-term plan for Fortis and was in the interests of all stakeholders, including shareholders,” Manipal Group CEO Ranjan Pai said in a statement on Friday.

“Our offer comprised a significant and necessary immediate investment, a clear strategic plan to fundamentally transform Fortis, as well as synergies from a combination with Manipal. It is now for shareholders to decide whether they will accept the board’s recommendation,” he added.

Fortis’ board had received offers from suitors such as Hero Enterprise Investment Office, Burman Family Office, Fosun Health Holdings, Malaysia’s IHH Healthcare Berhad, Manipal Hospital Enterprises and Radiant Life Care for infusion of funds. The bid winners’ offer was not the highest.

“Hero-Dabur have 30-40 investments in healthcare, have one hospital, which has a nurses’ training college and another training hospital. To run this business efficiently, we’ll need a regular supply of nurses and doctors,” Tempest said.

According to Fortis, the entire exercise for selecting the Hero and Burman consortium involved a process that witnessed “deliberation and recommendation” by an independent Expert Advisory Committee (EAC).

The EAC comprised Deepak Kapoor, former Chairman of PWC (India), and Lalit Bhasin, Chairman of the Indian Society of Law Firms, along with two financial advisors — Standard Chartered Bank and Arpwood Capital — while Cyril Amarchand Mangaldas were the legal advisors.

The deal envisages an upfront equity infusion of Rs 800 crore at a price of Rs 167 per share through preferential allotment. The Munjal-Burman consortium has also offered a further amount of Rs 1,000 crore through preferential issue of warrants.

Tempest said five members of the eight-member board had voted in favour of the winners, while three members voted for “another party”, without revealing details.

“There will be a shareholders’ EGM on this on May 22 and I am positive that there will be support from the shareholders for the decision,” he said.

Queried on the issue of the previous promoters Malvinder Singh and Shivinder Singh continuing on the board of Fortis’ diagnostics arm SRL, Tempest said the brothers should step down.

IHH Healthcare also expressed disappointment over losing the bid for Fortis Healthcare.

“We believe we submitted the most compelling bid for the benefit of all Fortis stakeholders. Our bid, which offers the highest price and most comprehensive solution, addresses the short-term liquidity requirements and long-term strategic objectives of the company,” IHH Chief Executive Tan See Leng said in a statement. (IANS)

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Global cues, banking, metal stocks lift Indian equity indices

May 11, 2018 0

Mumbai– Firm global markets along with healthy buying in banking, metal and capital goods stocks lifted the key Indian equity indices on Friday.

According to market analysts, better-than-expected quarterly earnings also supported the indices.

The wider Nifty50 of the National Stock Exchange closed at 10,806.50 points, up 89.95 points or 0.84 per cent from the previous close.

Similarly, the barometer 30-scrip Sensitive Index (Sensex) of the BSE ended in the green. It had opened at 35,287.99 points and closed at 35,535.79 points — up 289.52 points or 0.82 per cent.

The Sensex touched a high of 35,596.15 and a low of 35,262.06 points during the intra-day trade.

However, the BSE market breadth was bearish with 1,542 declines and 1,123 advances.

“Key benchmark indices opened higher and firmed up as the day progressed to finally close with gains of over 0.50 per cent,” said Abhijeet Dey, Senior Fund Manager, Equities, BNP Paribas Mutual Fund.

He said: “Globally, the sentiment turned risk-on as softer US inflation alleviated worries of a faster rate hike in the country and geo-political tensions ebbed with both the US and North Korea looking to reduce tensions in the region.”

According to Deepak Jasani, Head of Retail Research, HDFC Securities, positive Asian markets and overnight gains on Wall Street helped the Indian equities.

“Encouraging earnings announcements by Indian corporates also helped improve sentiments,” Jasani told IANS.

On the currency front, the Indian rupee weakened by 2 paise to 67.33 against the US dollar from its previous close at 67.31.

Provisional data with the exchanges showed that foreign institutional investors sold scrips worth Rs 325.44 crore while the domestic institutional investors purchased stocks worth Rs 1,163.35 crore.

Sector-wise, the S&P BSE banking index surged by 331.14 points, metal stocks rose by 216.26 points and the capital goods stocks edged up by 190.73 points.

On the other hand, the S&P BSE consumer durables index fell by 265.61 points, the healthcare stocks dropped by 104.55 points and the telecom stocks ended 53.91 points lower.

The major gainers on the Sensex were Asian Paints, up 6.17 per cent at Rs 1,289.60; Tata Steel, up 2.17 per cent at Rs 606.65; Larsen and Toubro, up 1.69 per cent at Rs 1,387.05; Yes Bank, up 1.52 per cent at Rs 349.95; and HDFC, up 1.50 per cent at Rs 1,924.35 per share.

The top losers were Bharti Airtel, down 6.44 per cent at Rs 385.70; Sun Pharma, down 5.05 per cent at Rs 471.85; Tata Motors (DVR), down 1.69 per cent at Rs 194.90; Tata Motors, down 0.78 per cent at Rs 330.75; and Hero MotoCorp, down 0.74 per cent at Rs 3,616.15 per share. (IANS)

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Titan net zooms 70% quarterly, 58% yearly

May 10, 2018 0

Bengaluru– Tata group’s watch and jewellery major Titan on Thursday reported a record quarterly and yearly consolidated net profit for fiscal 2017-18.

“Net profit for the fourth quarter zoomed 70 per cent year-on-year (YoY) to Rs 304 crore from Rs 179 crore in the same period year ago and 8 per cent sequentially from Rs 282 crore quarter ago,” said the city-based firm in a statement here.

For the fiscal (FY 2018), net profit shot up 58 per cent YoY to Rs 1,105 crore from Rs 699 crore in fiscal 2016-17 (FY 2017).

Consolidated sales revenue for the quarter under review (Q4) increased 11.6 per cent YoY to Rs 4,060 crore from Rs 3,637 crore in the like period year ago but declined 5.8 per cent sequentially from Rs 4,312 crore quarter ago.

Consolidated sales revenue for the fiscal under review (FY 2018) increased 20 per cent YoY to Rs 15,983 crore from Rs 13,308 crore year ago (FY 2017).

“The fiscal 2017-18 was remarkable in terms of business despite the changing environment and regulatory moves like the Goods and Sales Tax (GST) since July 1, 2017,” said the company in the statement.

The jewellery business grew 24 per cent YoY to Rs 13,036 crore for the fiscal on diamond activation and huge response to the revised gold exchange policy from customers.

The watches business, however, had a muted growth of 3.5 per cent to Rs 2,126 crore due to the impact of GST on top-line.

Eyewear sales were flat at Rs 415 crore due to GST on sunglasses, while sale of accessories, fragrances and sarees grew 46 per cent YoY to Rs 95 crore.

“We had top-line and bottom-line growth in the jewellery and watches business. The jewellery business was up in revenue growth and profitability. The business also gained from tailwinds provided by regulatory developments like the GST,” the statement quoted Titan Managing Director Bhasakat Bhat.

The company’s board decided to pay Rs 3.75 per share of Rs 1 face value or 375 per cent for the fiscal (FY 2018).

The company’s blue-chip scrip, however, lost Rs 13.10 per share at the end of Thursday’s trading on the BSE to Rs 972.60 against the Wednesday’s closing price of Rs 987.70 and opening price Rs 986. (IANS)

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Rajen Vagadia appointed Country Manager of Qualcomm India

May 10, 2018 0

New Delhi– US-based semiconductor and telecommunications equipment maker Qualcomm Incorporated on Thursday announced the appointment of Rajen Vagadia as the Country Manager of Qualcomm India.

With the new designation, Vagadia will report directly to Jim Cathey, Senior Vice President and President of Asia Pacific and India.

“Rajen has been instrumental in contributing to this growth and I am confident as a Country Manager, he will charter a new path that will help the Qualcomm establish itself as a leader in mobile, Internet of Things (IoT) and 5G,” Cathey said in a statement.

Larry Paulson, Vice President and President, Qualcomm India, who has been managing Qualcomm India operations from 2016 will help Vagadia with the transition.

Vagadia has played an important role in the LTE growth in India, Qualcomm said.

He has experience in business development of IoT across the different verticals covering smart cities, healthcare, automotive, wearables, home automation and industrial automation. (IANS)

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Fortis Board to recommend aHero-Burman’ bid for shareholders’ approval

May 10, 2018 0

New Delhi– Fortis Healthcare on Thursday said that its Board will recommend the binding offer of the Hero and Burman consortium for shareholders’ approval.

According to the healthcare major, the entire exercise for selecting the Hero and Burman consortium involved a process that witnessed “deliberation and recommendation” by an independent Expert Advisory Committee (EAC).

“The Board considered the views of the EAC, financial and legal advisors, and following extensive discussions arrived at this decision,” the company said in a late night statement on Thursday.

The EAC comprised of Deepak Kapoor, former Chairman of PWC (India) and Lalit Bhasin, Chairman of the Indian Society of Law Firms, along with two financial advisors – Standard Chartered Bank and Arpwood Capital – while Cyril Amarchand Mangaldas were the legal advisors.

The company’s Board had received offers from suitors such as Hero Enterprise Investment Office and the Burman Family Office, Fosun Health Holdings, IHH Healthcare Berhad, Manipal Hospital Enterprises and Radiant Life Care for infusion of funds. (IANS)

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NTPC auction yields solar tariff of Rs 2.73/unit, good response

May 10, 2018 0

Bengaluru– Auctions conducted here for solar power projects of 750 MW at Ananthapuram Solar Park in Andhra Pradesh have resulted in tariffs as low as Rs 2.72-73 per unit, state run generator NTPC said on Thursday.

Auctions in May last year yielded a record low solar tariff of Rs 2.44 per unit.

NTPC sources said the auctions were not for the company but had been conducted by it as part of the Solar Mission programme being implemented by the Union Ministry of New and Renewable Energy.

The three winners, who won 250 MW each, are UK-based Actis’ renewable energy arm Sprng Energy, which quoted a tariff of Rs 2.72 per unit, the British government supported Ayana Renewable Power and SB Energy Solar, a joint venture of Japan’s SoftBank, Taiwan’s Foxconn and Bharti Airtel. Both Ayana and SB Energy quoted Rs 2.73 per unit.

A total of 11 bidders put up bids cumulatively worth 4,000 MW in the NTPC auction, the official said.

According to the Ministry, “the objective of the Solar Mission is to create conditions, through rapid scale-up of capacity and technological innovation, to drive down costs towards grid parity”.

The government has targeted the deployment of 100 gigawatt (GW) of solar power by 2022 out of a total renewable energy target of 175 GW. (IANS)

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Caution ahead of Karnataka polls, global cues depress Indian equities

May 10, 2018 0

Mumbai– Caution ahead of the Karnataka assembly elections along with subdued global factors including high crude oil prices and geo-political tensions in the Middle East dragged the Indian equity indices lower on Thursday.

According to market observers, heavy selling pressure was witnessed in consumer durables, capital goods and healthcare stocks.

The broader Nifty50 of the National Stock Exchange (NSE) closed at 10,716.55 points — down 25.15 points or 0.23 per cent — from its previous close of 10,741.70 points.

Similarly the barometer 30-scrip Sensitive Index (Sensex) on the BSE closed in the red. It had opened at 35,353.96 points and closed at 35,246.27 points — down 73.08 points or 0.21 per cent — from its previous session’s close of 35,319.35 points.

The Sensex touched a high of 35,500.76 points and a low of 35,203.85 points during the intra-day trade.

The BSE market breadth was bearish with 1,890 declines and 775 advances. On the NSE, too, the market breadth was bearish.

“Sensex and Nifty50 closed lower on Thursday as investors are cautious ahead of elections in the state of Karnataka,” said Dhruv Desai, Director and Chief Operating Officer, Tradebulls.

According to Deepak Jasani, Head of Retail Research at HDFC Securities: “Rising crude oil prices also impacted the sentiments.”

“Broad market indices like the BSE mid-cap and small cap indices lost more, thereby underperforming the main indices,” Jasani told IANS.

The S&P BSE mid-cap fell 1.52 per cent, while the S&P BSE small cap settled 1.36 per cent lower from its previous closing level.

Jasani added: “major Asian markets have closed on a mixed note. European indices like FTSE 100 and CAC 40 are trading in the red.”

On the currency front, the Indian rupee weakened by 4 paise to 67.31 against the US dollar from its previous close at 67.27.

Provisional data with the exchanges showed that foreign institutional investors sold scrips worth Rs 364.88 crore, while the domestic institutional investors purchased stocks worth Rs 900.69 crore.

Sector-wise, the S&P BSE oil and gas index and the S&P telecom index were the only gainers on Thursday. The oil and gas stocks rose by 77.85 points, while the telecom stocks ended 0.27 points higher than its previous close.

On the other hand, the S&P BSE consumer durables index fell by 287.03 points, the capital goods stocks dropped by 214.64 points and the healthcare stocks ended 208.25 points lower.

The major gainers on the Sensex were ONGC, up 2.87 per cent at Rs 188.15; Bharti Airtel, up 1.92 per cent at Rs 410.35; Tata Motors (DVR), up 0.71 per cent at Rs 198.25; Reliance Industries, up 0.55 per cent at Rs 980.70; and HDFC Bank, up 0.54 per cent at Rs 1,989.70 per share.

The top losers were Dr Reddy’s Lab, down 3.70 per cent at Rs 1,988.30; Tata Motors, down 2.34 per cent at Rs 333.35; Sun Pharma, down 1.85 per cent at Rs 496.95; Power Grid, down 1.77 per cent at Rs 207.95; and Bajaj Auto, down 1.62 per cent at Rs 2,827.80 per share. (IANS)

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India, Ethiopia review bilateral ties

May 9, 2018 0

New Delhi– Reflecting New Delhi’s increasing engagements with Africa, India and Ethiopia on Wednesday reviewed bilateral ties during the second Joint Commission Meeting headed by External Affairs Minister Sushma Swaraj and her Ethiopian counterpart Workneh Gebeyehu here.

“The discussions focused on building closer cooperation in areas of defence cooperation, lines of credit, human resource development, capacity building, trade and investment, cultural exchanges and enhancing people to people contact,” the External Affairs Ministry said in a statement.

“India reiterated its commitments towards development partnership with Ethiopia.

“The two sides also exchanged views on issues of mutual interest at regional and multilateral levels including cooperation at the United Nations and other international organisations,” it said.

India-Ethiopia bilateral trade in 2016 stood at $1.37 billion, of which India’s exports to Ethiopia were $1.30 billion and imports were $68.4 million, according to figures provided by the External Affairs Ministry.

An MoU between the Foreign Service Institute of India and the Foreign Service Training Institute of Ethiopia was signed between the two countries after the conclusion of the meeting.

Indian companies are among the top three foreign investors in Ethiopia.

There are over 540 Indian companies in Ethiopia with licensed investment of over $4 billion of which about $2 billion is estimated to be on the ground, according to figures provided by the External Affairs Ministry. (IANS)

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Equities close flat on geo-political tensions, higher oil prices

May 9, 2018 0

Mumbai– After a largely volatile session, the key Indian equity indices ended Wednesday’s trade on a flat-to-positive note due to broadly weak global cues.

Market analysts pointed out that largely weak Asian equities, along with a rise in geo-political tensions after the US pulled out of the Iran nuclear deal as well as higher crude oil prices capped gains and unleashed volatility.

However, the key indices were somewhat supported by healthy buying in the consumer durables, IT and capital goods stocks.

Index-wise, the broader Nifty50 of the National Stock Exchange (NSE) closed at 10,741.70 points — up 23.90 points or 0.22 per cent — from its previous close.

Similarly, the barometer 30-scrip Sensitive Index (Sensex) ended the day’s trade higher from Tuesday’s closing level. It opened at 35,198.08 points and closed at 35,319.35, up 103.03 points or 0.29 per cent.

The Sensex touched a high of 35,404.83 points and a low of 35,134.20 during the intra-day trade.

The BSE market breadth was, however, bearish with 1,527 declines and 1,157 advances.

“It has been an indecisive day as mixed global trends and sparse domestic signals kept investor activity muted. Stock markets in India opened the day lower but subsequently firmed up to finally close the day with marginal gains,” said Abhijeet Dey, Senior Fund Manager, Equities, BNP Paribas Mutual Fund.

He said: “Overseas, Asian shares saw a mixed trend while European shares traded higher, supported by strength in oil stocks after Trump pulled the US out of Iran’s nuclear agreement, boosting crude prices.”

According to Deepak Jasani, Head, Retail Research, HDFC Securities: “Markets inched up higher on Wednesday to end with gains for the third consecutive session. Selling pressure in the afternoon session curbed the gains to some extent.

“Major Asian markets have closed on a mixed note. European indices like FTSE 100, CAC 40 and DAX traded in the green.”

On the currency front, the Indian rupee weakened by 19 paise to 67.27 against the US dollar from its previous close at 67.08.

Provisional data with the exchanges showed that foreign institutional investors sold scrips worth Rs 704.03 crore while the domestic institutional investors purchased stocks worth Rs 664.92 crore.

Sector-wise, the S&P BSE consumer durables index rose by 104.17 points, the IT stocks edged up by 97.28 points and the capital goods stocks was higher by 76.82 points.

On the other hand, the S&P BSE healthcare index fell by 64.45 points, the automobile stocks dropped by 56.26 points and the FMCG stocks ended 29.02 points lower.

The major gainers on the Sensex were Tata Motors (DVR), up 3.82 per cent at Rs 196.85; Tata Motors, up 2.79 per cent at Rs 341.35; Asian Paints, up 1.53 per cent at Rs 1,224.10; Tata Consultancy Services (TCS), up 1.39 per cent at Rs 3,489.05; and Axis Bank, up 1.36 per cent at Rs 548.60 per share.

The top losers were Sun Pharma, down 1.02 per cent at Rs 506.30; ICICI Bank, down 0.70 per cent at Rs 307.10; Maruti Suzuki, down 0.70 per cent at Rs 8,713.60; Wipro, down 0.66 per cent at Rs 270.50; and Mahindra and Mahindra, down 0.64 per cent at Rs 860.05 per share. (IANS)

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