Tata Teleservices (Maharashtra) zooms 72% in 3 days, hits 52-week high
Shares of Tata Teleservices (Maharashtra) (TTML) were locked in upper circuit for the third straight day, up 20 per cent at Rs 4.86 on the BSE on Wednesday on the back of heavy volumes. The stock of the Tata group telecom services company was trading at its 52-week high. It has zoomed 72 per cent in the past three days from the level of Rs 2.82 on Friday.
Till 10:31 am, a combined 19 million shares, representing 3.8 per cent of total free-float equity of TTML, had changed hands on the BSE and NSE. There were pending buy orders for 5.9 million shares on both the exchanges, data shows. In comparison, the S&P BSE Sensex was up 0.89 per cent at 40,906 points.
According to the Business Standard report, the Tata group is looking at reviving Tata Teleservices by taking the latter’s technical expertise and enterprise solutions for its SuperApp, which is being built. The Tata SuperApp is expected to bring the entire group’s products as well as services under one platform and enable sales to consumers directly. The super app is targeted to be launched by December this year, the report suggests. CLICK HERE FOR FULL REPORT
As of September 30, 2020, the promoters, Tata Teleservices (48.30 per cent), Tata Sons Private Limited (19.58 per cent) and Tata Power (6.48 per cent) have collectively held 74.36 per cent stake in TTML. While, individual public shareholders hold 22.89 per cent stake in the company, shareholding pattern data shows.
TTML provides telecommunication services to its subscribers in Mumbai and Rest of Maharashtra (including Goa) telecom circles. Tata Teleservices (TTSL) provides telecommunication services in Pan India, except Mumbai, Rest of Maharashtra (including Goa), Jammu & Kashmir, North East and Assam.
TTSL also operates and maintains National Long Distance service network within territorial boundaries of India under the license granted by Government of India. TTML and TTSL share certain infrastructure between them to achieve the optimum cost of operations and also seamless connectivity as part of offering such services across the Country to their respective subscribers. TTML and TTSL are conducting business under one single brand ‘Tata Tele Business Services’ with no overlapping geographies or conflicting businesses.
TTML has completed the demerger transaction of its consumer mobile business to Bharti Airtel on July 1, 2019. The company in 2019-20 annual report said the enterprise segment of the telecom business is projected to witness growth in the years to come based on wide optical fibre network of around 132,000 km. (TTSL+TTML).
The strong brand presence across customers in this business with deep customer relationships, the wide range of customized solutions enabling to service as an “A One-Stop-Shop” for meeting needs of enterprise customers and enhancement of the Product portfolio, including Managed Services, it said.
The Company further said it may also explore opportunities to strategically restructure certain business lines/assets at an appropriate time.
HDFC Bank rises 6% in 4 days
Shares of HDFC Bank were trading higher for the fourth straight day, up 1.5 per cent at Rs 1,241.75 on the BSE on Wednesday after the bank reported healthy September quarter (Q2FY21) results with net profit growing 18.4 per cent year-on-year (YoY) at Rs 7,513 crore on the back of substantial growth in interest earnings and other income.
The private sector lender’s stock was trading at its highest level since February 14, 2020. In the past four trading days, HDFC Bank has outperformed the market by gaining 6 per cent, as compared to 3 per cent rise in the S&P BSE Sensex. In the past month, it has rallied 18 per cent, against 8 per cent gain in the benchmark index.
Net interest income (NII) for Q2FY21 grew 16.7 per cent YoY at Rs 15,776 crore, driven by asset growth of 21.5 per cent and a core interest margin for the quarter of 4.1 per cent. On asset front, gross non-performing assets (NPAs) of the bank fell to 1.08 per cent of the gross advances as on September 30, 2020, as against 1.38 per cent a year earlier. Likewise, net NPAs too came down to 0.17 per cent from 0.42 per cent.
Meanwhile, the lender informed that its board of directors, at the meeting held on Saturday, approved the appointment of Sashidhar Jagdishan as an additional director and also managing director and chief executive officer of the bank.
The company’s management remains optimistic about a cyclical recovery. Loan against property (LAP) and retail working capital loan disbursals are already at pre- Covid levels and unsecured loans will reach pre-Covid levels by October. Bureau data shows that inquiries for auto and home loans have moved above pre-Covid levels.
With a focus on top-end customers across segments, superior underwriting, and healthy provisioning & capital buffers (CET 1 ratio at 17 per cent), analysts at Dolat Capital expect HDFC Bank to be amongst the best-placed amidst current uncertainty. “We factor in incremental stress (RSA+ slippage) of 3.7 per cent for the bank,” the brokerage said.
Larsen & Toubro Infotech surges 6% on healthy September quarter results
Shares of Larsen & Toubro Infotech (LTI) were up 6 per cent to Rs 3,139 on the BSE in the intra-day trade on Wednesday after the company reported strong revenue growth numbers and healthy margin expansion in July-September quarter (Q2FY21). Besides, the board also declared a first interim dividend for the financial year 2020-21 of Rs 15 per share of the face value of Re 1 each. The company has already fixed October 28, 2020, as the record date for the same.
In Q2FY21, LTI’s constant currency dollar revenues increased 2.3 per cent quarter on quarter (QoQ), higher than the analyst estimate of 1.1 per cent to 1.5 per cent. In rupee terms, revenue grew 1.7 per cent sequentially at Rs 2,998 crore, while net profit rose 9.7 per at Rs 457 crore on QoQ basis. Better pricing, utilization, and off-shore mix drove the robust improvement of 250 basis points (bp) QoQ / 440bp YoY in the EBIT (earnings before interest tax) margin to 19.9 per cent.
The company also won a large deal with net new TCV above US$40 million in analytics. The company’s large deal pipeline remains strong. LTI is seeing increased traction in digital, cloud and analytics space.
“LTI’s Ebitda (earnings before interest, taxes, depreciation, and amortization) margins increased 279 bps QoQ to 22.9 per cent, above our estimate of 20.5 per cent, mainly led by higher offshoring and increase in utilization,” ICICI Securities said in a note. The brokerage firm expects this improving trajectory to continue in coming quarters led by a healthy deal pipeline and its digital prowess.
At 12:06 pm, LTI was trading 5 per cent higher at Rs 3,106 on the BSE, as compared to 0.95 per cent gain in the S&P BSE Sensex. A combined around 600,000 equity shares had changed hands on the counter on the NSE and BSE till the time of writing of this report. It hit a 52-week high of Rs 3,515 on October 12, 2020.
How Are IPO Shares Allotted?
Initial Public Offering or IPO is a process in which a privately held organisation makes the shares of the firm available to the general public for purchase. This application is made available in assigned banks and online for applicants to bid. If you have ever applied for the shares of an IPO, you must have observed that many a time no shares were allotted to you. At the same time, maybe your friend was allotted some shares in the same IPO application. So, why does this really happen and how do IPO shares get assigned to applicants? Let’s understand the allotment process of an Initial Public Offering in detail and look at the reasons for zero allotments.
Procedure for Allotment of Shares in IPO
After an organisation launches an IPO to the general public, all bids for the shares are registered online. Then through an online process, all invalid bids that were incorrectly submitted are eliminated from the total number of bids. With this, you now have the final number of successful bids for the said IPO.
There are two cases amongst which the situation of a company may fall in, that are:
1. The total number of successful bids is less than or equal to the number of shares offered by the firm
2. The total number of successful bids is more than the number of shares offered by the firm
1: Total number of bids is less than or equal to the number of shares offered
If the total number of bids made by the applicants is less than or equal to the number of shares being offered, then complete allotment of stocks will take place. Thus, every applicant who has applied will be assigned shares.
2: Total number of bids is more than the number of shares offered
If the total number of bids made by the applicants is more than the number of shares being offered, then the allotment process of shares requires more planning. SEBI or Securities and Exchange Board of India mandates that at least one lot should be allotted to every individual who has applied.
ACC rises 4% post-September quarter results
Shares of cement companies were in focus at the bourses on Tuesday, gaining up to 4 per cent, after ACC managed to improve its sales volumes to pre-Covid levels along with expansion in margins during the July-September quarter (Q3CY20) despite localised lockdowns and monsoon impact.
ACC hit a 52-week high of Rs 1,622, up 4 per cent on the BSE on the back of heavy volumes. A combined 2.8 million equity shares had changed hands on the counter on the NSE and BSE till 09:43 am. In the past month, the stock has outperformed the market by gaining 12 per cent, against 4.5 per cent rise in the S&P BSE Sensex.
ACC’s revenues for Q3CY20 grew 0.3 per cent year on year (YoY) to Rs 3,537 crore. Net profit increased by 20.3 per cent to Rs 364 crore over the previous year quarter. Ebitda (earnings before interest, taxes, depreciation, and amortization) margins for the quarter improved 328 bps YoY to 19 per cent. Efficiency and cost reduction drives EBITDA margin during the quarter, the company said.
The management said that “despite Covid-19 headwinds, Indian economy is witnessing early signs of recovery. At ACC, this recovery has been reflected in our Q3 results where our volumes and sales have bounced back to prior-year levels”.
“Our efficiency and cost reduction plans have helped drive significant margin expansion during the quarter. We continue to manage working capital effectively resulting in healthy cash flow delivery,” it said.
Besides, other cement stocks were also trading firm. Orient Cement, Dalmia Bharat, Birla Corporation, Star Cement, India Cements, HeidelbergCement India, Shree Cement, JK Cement, JK Lakshmi Cement, UltraTech Cement and Ambuja Cements were up between 1 per cent and 4 per cent in intra-day trade, so far.
Recovery in cement demand in the North, Central and East regions surprised positively after the easing of lockdown norms, though demand remained under pressure in the South and West regions. The demand recovery, in the beginning, was led by strong rural demand, though infrastructure demand too has started improving recently.
Analysts at Emkay Global Financial Services remain constructive on the sector as they expect clinker utilization to improve gradually. “Though there has been cost inflation in H1FY21, we believe that price hikes and volume improvement will help companies improve profits,” the brokerage firm said in sector update.
HUL Q2 net up 9% YoY to Rs 2,009 crore
Hindustan Unilever (HUL) on Tuesday reported an 8.7 per cent year-on-year (YoY) rise in its net profit at Rs 2,009 crore for the second quarter of the current fiscal year (Q2FY21). The company had logged a profit of Rs 1,848 crore in the year-ago period.
On a sequential basis, numbers grew 6.8 per cent.
Total sales (revenue) for the quarter under review came in at Rs 11,276 crore, up 16.1 per cent YoY while underlying domestic consumer business sales (excluding the impact of business combinations) grew by 3 per cent YoY in the quarter. On a quarter-on-quarter (QoQ) basis, total revenue increased by 8.3 per cent.
The board has also declared an interim dividend of Rs 14 per share. The record date to determine the entitlement for payment of the interim dividend is fixed as October 29, 2020.
Analysts at Emkay Global had estimated HUL’s organic sales to grow 5 per cent year-on-year (YoY) whereas, including GlaxoSmithKline Consumer Healthcare (GSK) sales, revenue was expected to grow 19 per cent YoY at Rs 11,713.3 crore. Profit after tax (PAT) or net profit was estimated to increase by 16.4 per cent YoY and 13.9 per cent QoQ to Rs 2,133.3 crore.
Earnings before interest, tax, depreciation, and amortisation (Ebitda) for the quarter under review came in at Rs 2,869 crore, up 17 per cent YoY while Ebitda margin improved by 30 bps YoY to 25.1 per cent.
“In the context of a challenging economic environment, our growth has been competitive and profitable. We continue to demonstrate execution prowess, agility, adaptability, resilience, and passion of our people. We have expanded our portfolio with consumer-relevant innovations and have invested strongly behind our brands. Our operations and service levels are now back to pre-Covid levels and we have accelerated the pace of digitizing our operations under the ‘Re-imagine HUL’ agenda, ” said Sanjiv Mehta, Chairman, and Managing Director.
Siemens Healthineers to invest Rs 1,300 cr in India innovation hub
Global med-tech company Siemens Healthineers on Tuesday said it plans to invest Rs 1,300 crore over the next five years in an innovation hub in Bengaluru.
The investment aims to make India a manufacturing centre for the company’s emerging market products.
The innovation hub will be housed in a new campus that will combine R&D and manufacturing to make India a centre of competence for the design and development of entry-level products, said the company headquartered in Erlangen, Germany.
Siemens Healthineers said it plans to hire an additional 1,800 skilled digital tech experts to expand its digital capabilities in the next 10 years.
“This investment is the largest we have ever made in India. It will play a key role in taking our business to the next level by driving digitalisation and expanding our portfolio for emerging markets,” Elisabeth Staudinger, President Asia Pacific, Siemens Healthineers, said in a statement.
“The innovation hub in Bengaluru will demonstrate our commitment to advance healthcare through cutting edge digital technologies as well as through accessible and affordable innovations driven from India.”
When completed in 2025, the first phase of the new campus will include 70,000 square meters of office space for the enlarged R&D centre and 5,000 square metres of factory space, the company said.
The Bengaluru campus will be one of four innovation hubs of the company, with the other hubs located in the US, Germany, and China.
The innovation hub at Bengaluru will include centres of competence in digital technologies such as data analytics, Artificial Intelligence (AI), immersive technologies like augmented and virtual reality, user experience, and cybersecurity.
Siemens Healthineers said it has already invested about Rs 2,500 crore in R&D in India.
With about 50 per cent of all the software engineers in Siemens Healthineers, the existing R&D centre at Bengaluru plays a strategic role in developing cutting edge software products and platforms for all three segments of the company — imaging, diagnostics, and advanced therapies.
Hindustan Zinc Q2 profit dips 6.7% to Rs 1,940 cr
Vedanta group firm Hindustan Zinc Ltd (HZL) on Tuesday reported a 6.7 per cent drop in net profit to Rs 1,940 crore for the quarter ended on September 30, 2020, due to high expenses.
The company had posted a net profit of Rs 2,081 crore in the year-ago period, HZL said in a filing to BSE.
However, the total income of the company increased to Rs 6,050 crore in the July-September period from Rs 5,101 crore in the year-ago period.
Total expenses of the company during the quarter increased to Rs 3,428 crore from Rs 3,014 crore in the year-ago period.
Commenting on the results, company’s CEO Arun Misra said, “On the back of streamlined operations, we continue to deliver record volumes despite the challenges posed by the pandemic. We are setting up Hindustan Zinc for its next phase of growth and are confident to deliver superior value to our stakeholders in a sustainable manner.”
The company’s CFO Swayam Saurabh said that HZL’s operational discipline and focused cost optimisation programmes leveraging technology and digitalisation are driving its cost lower and is evident in its financial performance.
The company’s mined metal production for the quarter was up 9 per cent Q-o-Q to 2,38,000 tonnes on account of higher ore production. Mined metal production was driven by higher ore output resulting from better mining planning and effective targetting with the increased use of technology.
Integrated metal output for the quarter was 237,000 tonnes, up 13 per cent from a year ago, it said.
“Due to ongoing COVID-19 restrictions including visa restriction of Chinese nationals, commissioning of Fumer plant at Chanderiya is delayed and efforts are ongoing for early commissioning,” the company said.
As on September 30, 2020, the company’s gross cash and cash equivalents was Rs 27,631 crore.
Shares of the company closed at Rs 222.95 apiece on BSE, up 0.97 per cent.
ALL YOU NEED TO KNOW ABOUT NEW FUND OFFER
A new fund offer (NFO) is the first time subscription offer for a new scheme launched by the asset management companies (AMCs). A new fund offer is launched in the market to raise capital from the public to buy securities like shares, govt. bonds etc. from the market.
How does the New Fund Offer work?
In a new fund offer, the opportunity to subscribe to the scheme is available only for a limited period. The investors may purchase units of the mutual fund scheme during the pre-defined period and subscribe to the NFO at an offer price. This is usually fixed at Rs 10. Once the tenure expires, the investors would be able to purchase the fund units at the specified price. NFO subscribers, in general, have been able to generate noticeably better gains post-listing.
Difference between IPO and NFO
A lot of times, NFO is confused with IPO since both are ways for companies to raise money. However, they do differ. IPOs help businesses to raise capital to improve their operations, while NFOs help AMCs raise money from investors to buy more company stocks, debt, gold etc.
Also, IPOs are generally priced much higher than the face value. But in the case of NFOs, the fund is generally available at Rs 10 per unit.
Types of New Fund Offer
After the NFO, an open-ended scheme is available for all the investors. The investors, including the NFO subscribers, can then redeem their purchased units anytime they like.
In close-ended schemes, NFO investors are not able to exit the fund even after the NFO period. These funds generally have a maturity period of 3-5 years, and investors can only exit after maturity. In theory, these funds can also be traded on stock exchanges even before maturity. But their liquidity on exchanges is generally very low.
BENEFITS OF INVESTING IN NFO
Generate Profits -As discussed above, there can be a significant difference between the NFO price and the NAV. This difference can sometimes be highly rewarding.
Invest in Innovative Funds – Many AMCs are now launching innovative mutual funds schemes. For instance, some schemes specifically invest in recently-listed stocks and IPOs. And some schemes use hedging strategies to generate better returns for the investors. With NFO, you get to invest in such funds before it is open to every investor.
Lock-in Period for Disciplined Investing – A lot of people invest in mutual fund schemes only to redeem it after a few months. This negatively impacts the investment goals. But with NFOs, like close-ended NFO, there is a lock-in period for which you must to remain invested. This makes investment more disciplined and also increases the returns potential.
HDFC Life’s PAT rises 5.6% to Rs 326 cr in Q2
Private sector life insurer HDFC Life’s standalone profit after tax rose 5.6 per cent in the quarter ending September (Q2FY21) to Rs 326 crore, compared to Rs 308.69 crore in the same period last year.
Net premium income of the insurer in the second quarter rose 35 per cent to Rs 10,045 crore, compared to Rs 7,453.68 crore in the year-ago period. The insurer also saw a 15 per cent rise in the first-year premium in Q2FY21 at Rs 1,675.15 crore, compared to Rs 1,452.72 crore in the corresponding period last year. Renewal premium on the other hand grew by 21 per cent to Rs 4,310.37 crore. Single premiums grew more than 65 per cent in the period under review to Rs 4,197 crore.
In H1FY21, the total annualised premium equivalent (APE) of the insurer contracted 4 per cent to Rs 3,334 crore, compared to Rs 3,473 crore in the same period last year. The individual APE contracted 1 per cent to Rs 2,834 crore in the same period. While protection based on individual APE grew 38 per cent in H1FY21, protection based on APE contracted almost 30 per cent during the same period.
“Inflows into conservative long-term savings products have picked up in this quarter, with customers willing to commit to higher ticket sizes than Q1. Our product mix remains balanced with ULIPs at 23 per cent, non- par savings at 30 per cent, and par savings at 33 per cent”, said Vibha Padalkar, MD&CEO, HDFC Life.
Term products constitute 9 per cent of the product mix and annuity constitutes 5 per cent.
“It’s a bearish outlook for ULIP products, but that can change very quickly. Right now, it is more of a risk on the kind of approach wherein people don’t want volatility. They want assurance on their returns and therefore, par and non- par products are doing well”, Padalkar added.
The new business margins of the insurer in H1FY21 stood at 25.1 per cent, with the value of the new business at Rs 838 crore in the period under review, compared to Rs 957 crore in H1FY20.
The solvency ratio of the insurer stood at 203 per cent, aided by the fundraising of Rs 600 crore via non-convertible debentures. In H1FY21, the thirteenth-month persistency of the insurer stood at 88 per cent, while in Q2 it was close to 91 per cent.
The company has received 418 Covid death claims worth Rs 22 crore so far. The company has a reserve of Rs 41 crore, which it had instituted due to Covid. The management said it will suffice as far the Covid claims are concerned, but it will take a call on the reserve at the appropriate time.
The company is also looking to launch the Corona Kavach policy, the specified Covid health product of the insurer, as the regulator had allowed life insurers to sell it due to the prevailing situation.