Business News at 05:30 pm on 26th April, 2024

Let’s begin – Facing competition from over-the-top channels, direct-to-home operators like Bharti Airtel, Tata Play, Dish TV, and others are seeking a telecom sector-like tariff forbearance to price their offerings. Tariff forbearance is generally provided by regulators when it is felt that competition is high and the industry has matured in terms of pricing its offerings. Operators are free in such cases to set tariffs without any prior approval from the regulator, which in this case is the Telecom Regulatory Authority of India. However, operators need to file their tariffs within a week after implementation and if the regulator feels that changes need to be made, directions are issued. DTH operators feel that broadcasting sector has become highly competitive and also matured with the coming of OTTs, hence tight price regulation is not required any more.

Now news related to green IPOs – After NTPC Green’s Rs 10,000 crore initial public offer expected around November, almost a dozen more such issues are likely to hit the market over the ensuing months, with state-run energy companies seeking to bolster the capital bases of their newly incorporated green subsidiaries. These IPOs are part of a larger plan of these companies – Coal India, ONGC, SJVN, NHPC, India Oil and NLC India – to create robust climate-friendly asset bases, and enjoy the tax reliefs for new greenfield ventures (see chart). While a clearer picture will emerge only later, the combined value of these IPOs could easily run to tens of thousand crores, according to official sources and market experts.

Meanwhile – The forecast of above-normal monsoon in 2024 bodes well for good harvest, easing inflation concerns, finance ministry said in a report on Thursday, a day after a Reserve Bank of India bulletin said, “extreme weather events may pose a risk to India’s inflation in near-term.” According to the ministry, resilient growth, robust economic activity indicators, price stability, and steady external sector performance continue to support India’s “promising economic performance,” amidst uncertain global conditions. India’s food inflation declined from 8.7% in February to 8.5% in March. Food prices have, however, been key challenge for government, which have taken several actions to this end including strengthening buffers of key food items, making periodic open market releases of key grains, easing imports of essential food items through trade policy measures, preventing hoarding through imposition/revision of stock limits, channelling supplies through designated retail outlets, etc.

In another development – The country’s largest consumer goods company, Hindustan Unilever, has identified six key areas to invest in as it premiumizes the beauty portfolio, CEO & MD Rohit Jawa said during the analysts call post Q4 results. The six areas include face cleansing, sun care, light moisture, serums, weatherproof body care and masstige skincare, covering brands such as Ponds, Lakme, Dove & Vaseline and newer products such as Love Beauty and Planet, and Simple. At the same time, the company will also use more digital channels, media and influencer marketing to reach out to beauty consumers, especially the younger ones.

In a separate development – Food-tech unicorn Swiggy said on Thursday it has received approval from its shareholders at an extraordinary general meeting held on Tuesday for an initial public offering of $1.2 billion (Rs 10,414 crore), consisting of Rs 3,750 crore of fresh issue and up to Rs 6,664 crore ($800 million) as an offer-for-sale component, according to its RoC filings sourced through TheKredible. Swiggy, which is yet to file its draft red herring prospectus with Sebi, will also raise a pre-IPO round of Rs 750 crore from certain existing investors, the documents said. Recently, Entrackr reported that the company was offering shares at Rs 350 a piece and at a valuation of Rs 80,000 crore, which is roughly a 20% discount.

In another development – Shares of Vodafone Idea recovered their initial losses and rose up around 6% even as 16.36 billion new shares – allotted through the follow-on public offering – flooded the market on Thursday. The stock closed at Rs 13.89 per share on the BSE, which is over 26% higher than the FPO price of Rs 11. The company’s Rs 18,000-crore FPO, which is the largest-ever secondary share sale in India, received bids for 6.4x the number of shares that were on offer. Calling it the beginning of Vi 2.0, Aditya Birla Group chairman Kumar Mangalam Birla said the fundraise is a “fresh lease of life”.

Lastly – GIFT Nifty traded up by 25 points or 0.11% at 22,680 indicating a lacklustre opening for domestic indices NSE Nifty 50 and BSE Sensex on Friday. Shares in the Asia-Pacific region are trading in mixed territory on Friday morning. The Asia Dow is trading down by 1.60%, where as the Japan’s Nikkei 225 is trading in red, down by 0.07%, Hong Kong’s Hang Seng index is ended higher by 0.48% and the benchmark Chinese index Shanghai Composite is ended up by 0.27%.