BQuick On Jan. 17: Top 10 Stories In Under 10 Minutes  

This is a roundup of the day’s top stories in brief.

1. RIL’s Refining Margin Falls, Jio's ARPU Gets IUC Boost

Reliance Industries Ltd.’s standalone profit met estimates even as refining margin fell unexpectedly and output from its petrochemicals business declined.

• Revenue fell 1 percent to Rs 86,289 crore. That compares with the Rs 92,803-crore estimate.
• Operating profit fell 5.8 percent to Rs 12,871 crore, against an estimate of Rs 14,608 crore.
• Operating margin narrowed 80 basis points to 14.9 percent.

RIL’s gross refining margin fell to $9.2 per barrel from $9.4 in the preceding quarter.

Reliance Jio Infocomm Ltd.’s operating profit missed estimates in the quarter ended December as it added fewer subscribers than expected.

• Operating profit rose 8.64 percent sequentially to Rs 5,583 crore, lower than the Rs 5,978-crore consensus of analyst estimates.
• Net profit jumped 36.36 percent to Rs 1,350 crore.
• ARPU rose to Rs 128 from Rs 120. However, when adjusted for IUC charge it stood at Rs 127.5 in the September quarter.

Price hikes could mean slower customer additions in the near-term.

2. TCS’ Margin Rebounds, HCL Tech Hikes Guidance

Tata Consultancy Services Ltd.’s third-quarter profit met estimates and its margin rebounded from a nine-quarter low on the back of a weaker rupee and cost efficiencies.

• Net profit rose 1 percent sequentially to Rs 8,118 crore.
• Revenue rose 2.3 percent to Rs 39,854 crore.
• Dollar revenue is $5,586 million versus $5,517 million.
• Operating margin expanded 100 basis points to 25 percent—the first rise in four quarters.

The company said it will be “happy” to clock 8 percent revenue growth which is not “anywhere” near the 11.5 percent it hit last fiscal.

HCL Technologies Ltd. raised revenue guidance for the ongoing financial year as its net profit beat estimates.

• Net profit rose 14.6 percent sequentially to Rs 3,037 crore.
• The company also raised its revenue growth guidance to 16.5-17 percent in constant-currency terms for the financial year ending March from 15-17 percent earlier.

Deal pipeline currently stands at an all-time high.

3. Is There Still Hope For Bharti Airtel, Vodafone Idea?

India is open to hearing wireless carriers’ suggestions to help ease payment of $13 billion in overdue fees, a government official with knowledge of the matter told Bloomberg News.

• Stripping out interest from the dues or paying the amount in tranches are some ideas that the government can discuss, the official said, asking not to be identified citing rules.
• An independent panel can examine such requests provided the companies commit to pay some amount immediately, the official said.
• The official spoke before the top court on Thursday rejected telecommunication operators’ plea to review an October verdict.

The ruling could help boost the government’s tax collection but will be a blow to the debt-saddled telecom firms.

Contrast In Fortunes

Vodafone Idea Ltd.’s shares partially pared losses after a record 39.2 percent intraday plunge, after the possibility of relief regarding the additional gross revenue emerged.

• The stock recorded its largest intraday fall ever of 39.2 percent, before closing the day 25.2 percent lower.

Read more here.

Shares of Bharti Airtel Ltd., though, rose to the highest in more than 12 years after a Supreme Court order raised the prospects of a telecom duopoly in India.

• On Friday, the company’s shares gained 6.31 percent over previous close to Rs 503.80 apiece—the highest since Oct. 17, 2007.

Here’s how the Vodafone Idea customers could split between Airtel and Jio in case of a shutdown.

Related Coverage

• Here’s what struggling telecom operators owe banks.
• India’s banks face risk from $13 billion telecom dues, UBS says.
• Franklin Templeton Mutual Fund marks down Vodafone Idea debt.
• Reliance Jio loses customers for the first time.

4. Sensex Ends Flat, U.S. Stocks Rally

Indian stocks ended mixed on a volatile session ahead of quarterly results from RIL and TCS.

• S&P BSE Sensex closed flat at 41,945.37, while the NSE Nifty 50 ended largely unchanged at 12,352.
• RIL contributed the most to the Sensex advance, increasing 2.8 percent.
• Housing Development Finance Corporation Ltd. was the biggest drag on the index, declining 1.1 percent while IndusInd Bank Ltd. had the biggest drop, falling 2.5 percent.

Follow the day’s trading action here.

Stocks extended this week’s relentless push to all-time highs as positive U.S. and China economic data, low interest rates and easing trade tensions propelled investor optimism.

• The benchmark S&P 500 Index set a record intraday high for the eighth consecutive trading session.
• The Dow Jones Industrial and Nasdaq Composite also set new highs.
• U.S. housing starts surged last month, while factory production unexpectedly increased.
• The dollar strengthened and gold climbed.

Get your daily fix of global markets here.

5. Piramal’s $950-Million Deal

Piramal Enterprises Ltd. will sell its healthcare insights and analytics business to the U.S.-based Clarivate Analytics Plc. for $950 million (around Rs 6,750 crore).

• The company’s board approved divesting 100 percent of its Decision Resources Group business in a meeting today, according to an exchange filing.
• The total sale value includes $900 million in cash and about $50 million worth of Clarivate’s ordinary shares that will be issued after one year of the transaction.
• Piramal had initially invested $650 million in 2012 to acquire DRG, of which $260 million was infused as equity.
• It has realised 2.3 times its initial equity investment in rupee terms, the filing said.

Here’s how Piramal will utilise the funds from the sale.

7. Problems Pile Up For Punjab

The slowdown in state tax revenue and reduced transfers from the central government has forced the North Indian state of Punjab to cut spending across a number of new projects and schemes. So dire is the situation that the state even had to stagger salary payments last month, said Punjab Finance Minister Manpreet Singh Badal in an interview to BloombergQuint.

• Tax collections are lower by 10-15 percent compared to the budget estimates, Badal said. “Not only in terms of the tax that we had budgeted for but also in terms of the grant from the Government of India and the devolution which comes from the centre,” Badal said.
• “Even though Punjab is a very small state, almost Rs 1,500 crore of less tax is coming in than what had budgeted for,” he said.
• Badal echoes the sentiment of a number of state finance ministers. Weaker tax revenues, lower and, sometimes delayed, transfers from the central government have made the management of state finances tougher in 2019-20.

The result is lesser room for spending when the economy is already under pressure. Watch the full interview here.

8. Should Jeff Bezos Worry About India?

Jeff Bezos is in India at an awkward moment. Just before his visit, the country’s antitrust authority ordered a probe into the business practices of its two main American-owned shopping websites. One of them is his.

• If the Competition Commission’s recently released study on e-commerce is any guide, Bezos shouldn’t lose any sleep over the $6.5 billion he has committed so far — including $1 billion just this week — to win the only billion-person market that’s open to Western tech firms.
• The document, which forms the basis for the antitrust investigation, has much fodder for action, but nothing that hasn't already been chewed over.
• Can the competition investigation upend existing business models? There’s a hint of a stick in the watchdog’s study, which notes that.
• It’ll be unrealistic to expect anything more dramatic from the formal inquiry. After all, the final customer isn’t complaining.

Still, should Bezos be worried? Andy Mukherjee writes.

9. Air India Decks Up For Suitors

Air India Ltd. is trying to make itself more attractive to potential bidders by deploying a greater number of high-end seats for the lucrative London market and adding new flights by repairing grounded aircraft.

• The carrier started using Boeing Co. 777 jets for flights to London from New Delhi this week, replacing the smaller 787 Dreamliner that now flies three times a week to Washington DC.
• The 777 offers four first-class and 35 business-class seats and can return from London the same day given it’s a 10-hour flight.
• The Dreamliner doesn’t offer first class and has fewer seats in the business section.

With suitors in mind again, Air India is trying to brush up its image.

10. How To Fix Twitter Elon Musk Style

Elon Musk’s suggestion for how to fix Twitter? Identify the bots.

• Musk, the SpaceX and Tesla Inc. chief executive officer, was asked Thursday by Twitter Inc. CEO Jack Dorsey how he would fix the social network, where Musk has almost 31 million followers.
• “Give us some direct feedback,” said Dorsey, who spoke to Musk via a video call from a company meeting in Houston. Musk was projected onto a giant screen as thousands of Twitter employees watched the two executives chat. “If you were running Twitter,“ Dorsey continued, “what would you do?”
• “I think it would be helpful to differentiate” between real and fake users, Musk replied, according to a video posted to Twitter by an employee. “Is this a real person or is this a bot net or a sort of troll army or something like that?”

Musk is one of the site’s most popular users and one of its most controversial.