Business News at 05:30 pm on 24th January, 2024

Let’s begin with some market news. The broking firm Jefferies has raised the target price on the stock of Hero MotoCorp to Rs 5,325 from Rs 4,800, an increase of 20%. It has kept the rating unchanged to “Buy” as the brokerage house believes the company to have a “strong cyclical recovery in two-wheelers.” Also, it believes any potential success of premium bikes and electronic vehicles can work as a growth catalyst. Further, the brokerage house said that the company’s new 125cc bike, Xtreme-125R, filled a key product gap, which can help the company regain some share in the segment. The company’s share in the 125cc segment declined “from an average 43% over FY19-21 to just 18% in YTD.”

In some more market news, Axis Bank shares saw a sharp slide in early trade and have been the primary laggard on the Indices. This fall in prices of the stock can attributed to the third quarter’s financial results and concerns about loan growth prospects. Motilal Oswal slashed the rating to “Neutral” on the stock of Axis Bank, with a target price of Rs 1,175. According to a research report, the brokerage house has cut the earnings per share estimates for FY25 by 8% as Axis Bank’s costs increased and also margins are seeing pressures. Also, the bank’s credit-deposit ratio is higher standing at 93%. Considering this the brokerage house estimates the bank to have a loan growth of 15.7% over FY24-26.

Meanwhile, Consumer electrical goods maker Havells India reported its third quarter profit for the financial year 2023-24 at Rs 287.91 crore, up 1.5 per cent in comparison to Rs 283.52 crore during the same period last year. It posted revenue from operations at Rs 4,413.86 crore, up 6.9 per cent as against Rs 4,127.57 crore during the third quarter of FY23. While the company posted total income during the quarter in review at Rs 4,469.75 crore, total expenses incurred during the quarter was at Rs 4,079.02 crore. The Board of Directors also declared an interim dividend of Rs 3.00 per Equity Share of Re 1 each, i.e., at 300 per cent on the equity share capital of the company.

Speaking of profit, Canara Bank on Wednesday reported its third-quarter profit at Rs 3738.26 crore, up 27.9 percent in comparison to Rs 2923.16 crore during the corresponding quarter of last year. The bank’s Net Interest Income stood at Rs 9,417 crore, up 9.50 percent on-year. The Net Interest Margin, meanwhile, stood at 3.02 per cent improved by 9 bps. The Bank’s Gross Non-Performing Assets ratio stood at 4.39 per cent as at December 2023 as against 5.89 percent recorded during the same quarter last year. The Net Non-Performing Assets ratio stood at 1.32 percent as at December 2023 as against 1.96 per cent last year. The PCR improved to 89.01 percent as at December 2023 from 86.32 percent as at December 2022.

Moving on. The Supreme Court of Wednesday cancelled the bail of Kapil Wadhawan in the Rs 34,615-crore DHFL bank fraud case. According to Bar & Bench, Justice Bela M Trivedi pronounced the order. In its order, the apex court said quote, “We have no hesitation that the chargesheet having been filed and cognisance being taken in due time, respondents could not have claimed statutory bail as a right. HC and lower court greatly erred. Trial court to hear afresh on regular bail. Appeals allowed accordingly,” unquote. The Wadhawan brothers were accused of defrauding nearly 20 banks to the tune of Rs 34,615 crore. In terms of the scale of the scam, it is considered as India’s biggest banking fraud.

In the aviation industry, Air India has been fined Rs 1.10 crore by the Directorate General of Civil Aviation for safety violations on certain long-haul routes. The penalty comes after the aviation watchdog conducted a thorough investigation based on a safety report submitted by an Air India employee. The report alleged safety breaches on flights operating specific long-range critical routes. Following the investigation, which indicated non-compliance by the airline, DGCA issued a show-cause notice to Air India. The safety concerns raised in the report specifically related to leased aircraft operated by the airline. Due to the leased aircraft’s operations not aligning with regulatory and OEM performance limits, DGCA has imposed a penalty of Rs 1.10 crore on Air India.

Lastly, the share market. Benchmark indices ended higher in the volatile session on January 24 with Nifty above 21,450. Top gainers on the Nifty were Hindalco Industries, Dr Reddy’s Laboratories, Tata Steel, IndusInd Bank and HCL Technologies, while losers included ICICI Bank, Axis Bank, Asian Paints, Adani Ports and HDFC Life. Among sectors, auto, Information Technology, capital goods, FMCG, metal, oil & gas and power up 1-2 per cent. BSE Midcap and Smallcap indices added nearly 2 per cent each.