BQuick On July 27: Top 10 Stories In 10 Minutes
This is a roundup of the day’s top stories in brief.
1. How Secure And Private Is Your Data? This Draft Law Will Decide
A panel headed by retired Justice BN Srikrishna submitted its report to the government on suggestions for a data protection law that will cover everything from Aadhaar biometric database to data consent, transfer and use.
Here are the highlights:
- Definition of personal data flexible, sensitive personal data defined.
- Processing of personal data by both public and private entities covered under law.
- Personal data processing needs consent; fiduciary liable if harm caused after consent.
- Data can be used only for the purpose stated.
- Data subjects to get rights.
- Data Protection Authority, appellate authority tasked with enforcement.
Read a summary of the key recommendations here.
2. U.S. GDP Growth Is At Its Fastest Since 2014
The U.S. economy accelerated to a 4.1 percent pace of growth in the second quarter, the fastest since 2014, letting President Donald Trump claim a win for his policies even though the expansion is projected to cool.
- GDP growth was just short of the 4.2 percent median forecast in a Bloomberg survey
- This was much higher than the 2.2 percent growth for the first quarter
- The scorecard gives Trump a chance to highlight the success of his policies
- Risks from tariff wars and a fading effect of tax cuts are why analysts find it hard to see the economy growing at a robust pace
3. U.S. Stocks Drift. But Sensex, Nifty Close At Fresh Records;
Indian equities climbed for a sixth day, helping the benchmark gauges post a fresh record every day this week, as positive earnings news kept the bulls energised.
- The S&P BSE Sensex surged 0.95 percent or 352 points to 37,337.
- NSE Nifty 50 index climbed 1 percent or 111 points to 11,278.
- The rally was led by ITC, Indian Oil and Tata Motors.
- Benchmarks have surged over 5 percent so far this month, heading for the best monthly gain since April.
Follow the day’s trading action here.
Meanwhile stocks on Wall Street drifted early Friday, while the dollar dipped and treasuries gained, as news of a surge in U.S. economic growth contended with disappointing quarterly results from Exxon Mobil and Twitter.
Get your fix of global markets here.
4. Win-Win For Reliance Jio; Rise And Rise Of Reliance Petrochemicals
Reliance Industries Ltd.’s profit rose marginally in the April-June quarter, beating street expectations. The company’s standalone net profit grew 1.4 percent sequentially to Rs 8,820 crore, according to its exchange filing. That compares with the Rs 8,525 crore consensus estimate of analysts tracked by Bloomberg.
- Revenue rose 8.5 percent over the previous quarter to Rs 91,159 crore—higher than the Rs 88,503 crore estimated.
- Operating profit grew 12.9 percent to Rs 15,154 crore.
- Margins expanded 60 basis points to 16.6 percent.
- Petrochemicals business now contributes more to RIL's operational profit than any other segment.
- Higher petrochemicals’ revenue was driven by production ramp up, better volume growth and higher spreads.
- Retail business has nearly doubled over last year.
For a detailed report of Reliance's earnings, click here.
Reliance Jio Infocomm Ltd. reported its third straight profit beating estimates as average revenue per user fell less than expected.
- Net profit rose almost 20 percent sequentially to Rs 612 crore.
- Operating profit rose 16.8 percent to Rs 3,147 crore.
- Operating margin expanded 101 basis points to 38.8 percent.
- ARPU declined to Rs 134.5.
Read more on Jio’s first quarter results.
5. ICICI Bank Has Its First Net Loss Since 2001
ICICI Bank Ltd. reported a surprising net loss for the quarter ended June 2018 as the lender chose to set aside more money to cover for bad loans. This is the first quarterly loss reported by the private sector bank since at least 2001, according to Bloomberg.
- Net loss stood at Rs 119.5 crore, compared to a profit of Rs 2,049 crore last year.
- Weak asset quality continued to pressure the lender as gross bad loan ratio stood at 9.65 percent of total advances.
- Provisions stood at Rs 5,971 crore, while provision coverage ratio rose 560 basis points to 66.1 percent.
- The lender said it chose to increase provision coverage to strengthen its balance sheet.
Read detailed analysis of ICICI Bank’s earnings here.
6. HDFC AMC IPO Garners Heavy Demand
The initial public offer of HDFC Asset Management Company got subscribed 83 times on the last day of bidding today.
The Rs 2,800-crore IPO received bids for over 156 crore shares against the total issue size of more than 1.88 crore shares, according to data available on the National Stock Exchange.
• The category set aside for qualified institutional buyers was subscribed 192.26 times.
• Non-institutional investors' segment was subscribed 195.15 times.
• The retail investors category received 6.61 times more demand than the shares on offer.
• HDFC AMC has total assets under management of over Rs 3 lakh crore as of March end.
It is the second asset management company to hit the market after Reliance Nippon Life AMC, which had raised Rs 1,542 crore last year.
Kotak Mahindra Capital Company, Axis Capital, DSP Merrill Lynch, Citigroup Global Markets India, CLSA India, HDFC Bank, ICICI Securities, IIFL Holdings, JM Financial, J P Morgan India, Morgan Stanley India Company and Nomura Financial Advisory and Securities are managing the issue.
7. The Haircut Analysis That PM Modi Should’ve Used, Writes Congress’ Praveen Chakravarty
If we, like the Prime Minister, assume these barbers employ two new people, then the haircut industry alone generates nearly five lakh new informal jobs every year. Such irrefutable haircut analysis can now be extrapolated to the larger economy to estimate the total number of jobs created and thus we can infer that India does not have a jobs scarcity but a jobs bounty.
If you find this line of reasoning laughable, you will not be alone.
That the Prime Minister of India, who was blessed with the extraordinarily good fortune of an absolute majority in Parliament, low oil prices, and a robust global economy, had to resort to inane, twisted and bizarre analytics to explain the state of jobs for the nation’s youth is in itself a vindication of how dire the jobs situation in the country is.
Read more on how Praveen Chakravarty thinks PM Modi should’ve addressed the jobs problem.
8. Kidnappers, Angry Workers Plague A $210 Billion Debt Cleanup
Devendra Jain was abducted one muggy Mumbai afternoon last September, whisked away in a car by angry investors of an insolvent firm he was tasked with reviving. It took nearly 24 hours and a lucky phone call for the police to track him down. He now keeps an armed bodyguard with him at all times.
- Bankruptcy experts called resolution professionals are becoming India’s foot soldiers as it attempts to clean up $210 billion of bad debt.
- RPs are facing treacherous terrain including obstructionist owners, worker protests and even the rare kidnapping.
- Stakes are so high that brokers are offering them special insurance plans.
Read more about the middlemen charged with cleaning up the world’s second largest bad debt book.
9. Meet The Man Who Shut Down One Of Mumbai’s Busiest Bridges
Pradipta Banerji’s investigation is only a few days old but he has already found his first culprit: a creaking 100-year-old bridge.
That’s now been shut. It will be demolished and rebuilt in two years. The problem is that the Delisle bridge, a link to the business district in the heart of central Mumbai’s Parel area, is among the busiest in the city.
Banerji, a professor of civil engineering at the Indian Institute of Technology, Bombay, is convinced that he is right. “Whenever you shut down something, there is always heartbreak,” he told BloombergQuint.
10. Life At Aditya Birla Group After Rs 1 Lakh Crore Worth Of Deals In Two Years
Kumar Mangalam Birla, the chairman of the $44 billion Aditya Birla Group, is leading the charge to integrate acquisitions worth over Rs 1,00,000 crore ($14 billion) his companies have undertaken in the last two years. Group companies have since 2016 acquired the cement assets of Jaypee Group for over Rs 16,000 crore, initiated a merger with Vodafone, valuing the India arm of U.K.-based Vodafone Plc. at over Rs 80,000 crore, and announced an Rs 18,000 crore acquisition of Aleris Corp.
- Integration of UltraTech Cement and Jaypee is “beautifully done”.
- Group faces herculean task of merging Idea with Vodafone.
- Acquisition spree is not over yet as UltraTech pursues insolvent Binani Cement.
- Birla said no further consolidation is needed within the group.
Watch the full interview with Kumar Mangalam Birla here.