BQuick On Dec. 7: Top 10 Stories In Under 10 Minutes
Here’s a roundup of the day’s stories in brief.
1. Retail Car Sales Hit 3-Year High
Passenger car sales at dealerships jumped to the highest in nearly three years as demand picked up during the festival season.
Vehicle registrations—a measure of sales at dealerships—of passenger cars rose 2.6% year-on-year to 2.8 lakh units in November, according to data compiled by BloombergQuint from the Ministry of Road Transport and Highways’ Vahan website.
The jump was mostly driven by Maruti Suzuki India Ltd. and two new entrants—MG and Kia Motors Corp.
That compares a 20.2% year-on-year drop and a 28.4% rise over the previous month in overall vehicle registrations in the reported month.
Find out how first-time buyers were behind the pick-up in sales in November.
2. Corporate Investment Green Shoots?
Hindalco Industries Ltd. has revived a $947 million plan to make more value-added aluminum products as the Indian economy recovers from the coronavirus pandemic.
Billionaire Kumar Mangalam Birla’s aluminum major will invest Rs 7,000 crore to double its capacity to more than 600,000 tonne annually over the next few years, the company said in an exchange statement Monday.
The company will kick off its long-term downstream investment plan by setting up a 34,000-ton aluminum extrusion project in the western Indian town of Silvassa, with production expected to start in two years.
Group company, UltraTech Cement Ltd., unveiled a Rs 5,477-crore capacity expansion plan on Dec. 3.
In June, Hindalco had said it will slow down expansion plans.
3. SBI Looks To Boost Retail Loan Book
State Bank of India will accelerate retail loans and expects most lenders to post stronger-than-anticipated earnings as the economy revives faster than expected, according to Chairman Dinesh Khara.
“The banks were expecting worse, so they strengthened risk management significantly,” Khara, who took charge as head of the country’s largest lender in October, said in an interview with Bloomberg Television.
“That’s why we are expected to see much better results than at the beginning of the pandemic,” he said.
The state-run bank has provided for its potential bad loans in advance, which will prevent significant pressure from building.
4. Sensex's Record-Breaking Run Continues
Indian equity markets began the new trading week on a positive note, after a sluggish start, gaining momentum in the second half of trade.
The S&P BSE Sensex ended 0.8% higher at 45,426 while the NSE Nifty 50 index ended above the mark of 13,300, up 0.7%.
Both Sensex and Nifty registered another record high.
The PSU Bank index ended 2.1% higher at the highest level in nine months.
Follow the day’s trading action here.
35% Earnings Growth Next Fiscal?
Jefferies Mahesh Nandurkar has said that the battered real estate sector will lead a sharp recovery in Nifty earnings in the upcoming fiscal.
Find out why he is placing his faith in the sector.
Global Stocks Mixed Amid Stimulus Talks, Brexit Deadlock
Stocks were mixed as traders awaited more details on a new stimulus package, with coronavirus infections sweeping across U.S. states.
The S&P 500 dropped from an all-time high, while the Nasdaq 100 rose.
Intel Corp., the world’s largest chipmaker, slid on news that Apple Inc. is planning a series of new Mac processors for introduction as early as 2021.
The pound fell on concern that Brexit talks could collapse.
West Texas Intermediate crude decreased 0.5% to $46.02 a barrel.
Get your daily fix of global markets.
5. Franklin Templeton To Seek Unitholder Nod To Wind Down Schemes
After the Supreme Court’s direction, Franklin Templeton Mutual Fund sought consent from unitholders for winding up six of its fixed income schemes.
The fund house, through a notice, informed unitholders that voting on the issue would take place electronically between Dec. 26 and Dec. 28.
That’ll be followed by a meeting of the unitholders of the relevant schemes through video conferencing on Dec. 29, according to its media statement released on Monday.
If a majority of unitholders in any or all of the six fixed income schemes decide to vote ‘no’, thereby declining to give consent for winding up, the schemes will be re-opened and unitholders will be free to sell their units, it said.
Franklin Templeton has cautioned reopening the schemes could lead to distress selling, eroding the value of its assets.
6. Tata Empire Faces Tough Decisions
Ratan Tata is no stranger to flying. As a 17-year-old, the patriarch of India’s biggest conglomerate once landed a plane that had lost its sole engine mid-flight. He’s also piloted the supersonic F-16 fighter jet.
That love of aviation hasn’t always translated into business success, however. Tata Group’s two airlines -- AirAsia India and Vistara -- were struggling before the coronavirus pandemic.
Covid-19 has put the sprawling Tata Sons Ltd., which owns a 51% stake in each, at a crossroads.
Either go big, by buying state-run Air India Ltd., for example, or bow out before spilling more red ink.
Stuck between a rock and a hard place, will Tatas continue to be devoted towards making an airline work at any cost?
7. Wipro’s New Boss Doesn’t Need To Step Into Office To Make The Stock Rally
In the five months since he took over as chief executive officer of Wipro Ltd., Thierry Delaporte has yet to visit the Indian outsourcer’s Bangalore headquarters once. Instead, the 53-year-old has been on a virtual tour from his home in Paris, meeting with managers, workers and customers around the globe.
He’s trying to turn around the struggling business without letting the Covid-19 pandemic slow him.
Delaporte slashed the top ranks of leadership from 25 people to four. He stepped up acquisitions, with more on the way.
Mostly, he focused his attention on customers, meeting with 130 over video conference and helping to land new multi-year contracts with clients in the U.S. and Europe.
The company’s stock has rallied about 70% since his appointment, most among India’s four largest outsourcing firms.
It’s a rare victory for Wipro, but the company needs more than just enthusiasm right now.
8. Gems, Jewelry Exports Recover Sharply
Exports of gems and jewelry from India, which polishes about 90% of the world’s rough diamonds, showed a sharp recovery in November.
Overseas shipments fell about 4% from a year earlier to $2.48 billion, compared with a 99% plunge at the start of the financial year in April, according to Colin Shah, chairman of the Gem & Jewellery Export Promotion Council.
It was also milder than the 19% to 40% decline in the prior three months.
As many as 90% of the industry’s workers have come back, says Shah.
9. ‘Bharat Bandh’ Tomorrow
Thousands of farmers protesting against the Centre's new laws for the past 11 days have called on people to join their 'Bharat Bandh' on Tuesday in large numbers, even as police increased deployment at various Delhi border points.
Farmer leaders also welcomed the support of political parties to the nationwide strike against the laws and demanded that the legislation be repealed.
The Congress, Aam Aadmi Party, Samajwadi Party, Bahujan Samaj Party, Nationalist Congress Party, CPI (M) and DMK are among the political parties that are backing the day-long strike.
Besides political parties, trade unions, transporters unions and bank unions have all lent their support to the movement.
The Centre has asked all states to tighten security and ensure peace. Read more here.
10. Indo-China Tensions: New Frontier
Indian officials say China is assisting rebel groups that have stepped up attacks on its border with Myanmar in recent months, opening another front in the conflict between two nations already engaged in a deadly standoff in the Himalayas.
Armed groups in Myanmar -- including the United Wa State Army and the Arakan Army, which was designated a terrorist organization this year -- are acting as Beijing’s proxies by supplying weapons and providing hideouts to insurgent groups in India’s northeastern states, according to Indian officials with knowledge of the situation, who asked not to be identified due to rules for speaking with the media.
The officials said multiple security agencies warned Prime Minister Narendra Modi’s government that at least four of India’s most wanted insurgent leaders were in the southern Chinese city of Kunming to train and source weapons as recently as mid-October.
China has denied claims saying it doesn’t interfere in the affairs of other countries.