Business News at 05:30 pm on 8th November 2023

Let’s begin, Lenders of Go First are expecting to recover around 25%-30% or Rs 1,600-1,900 crore of their exposure to the beleaguered airline, a senior banker told FE. This will come primarily from the parcel of land in Thane that the Wadia group has given as collateral to the banks. The grounded airline, which stopped flying from May 3, is undergoing an insolvency resolution process under the Insolvency and Bankruptcy Code (IBC), owes Rs 6,521 crore to the lenders including Central Bank of India, Bank of Baroda, Deutsche Bank, and IDBI Bank. The recovery of 25%-30% is a little less than what the financial creditors have realised from the IBC process in FY23 at 36%.

Next up, the government on Tuesday made it clear to social media firms like X, Facebook, Instagram, etc that pending a new Digital India Act, they should take down content related to deep fakes and similar misinformation from their platforms even in the absence of a formal complaint, under the provisions of Information Technology Act. It also warned the firms concerned that failure on their part to act under the provisions, will attract punishment under Section 66D of the IT Act, 2000, which involves punishment for cheating by personation by using computer resources and imprisonment of up to three years and a fine of up to Rs 1 lakh.

Now let’s talk market, Honasa Consumer, which owns the Mamaearth brand of products, had a lukewarm debut on the exchanges. Shares of the company closed the session up just 4% on Tuesday. The company listed at an issue price of Rs 324 on the BSE and with a 1.85% listing premium at Rs 330 on the NSE, closing the day with a 4.06% and 4.10% gain on the two exchanges, respectively. According to analysts, this did not come as a surprise, given that the market has been cautious on the firm given its financials. It closed the session with a market capitalisation of over Rs 10,800 crore.

Meanwhile, India’s fast-moving consumer goods (FMCG) market reported a 9% year-on-year jump in September 2023 quarter sales and an 8.6% rise in volumes for the period, market research agency NielsenIQ (NIQ), said on Tuesday, led by urban markets. Rural markets, despite showing indications of progress, still have a long way to go before fully recovering, according to the market research firm in its quarterly market analysis. A closer look at the data shows that the overall FMCG value growth for the three months ended September 2023 has slowed when compared to the March 2023 quarter (10.2%) and June quarter (12.2%) each, thanks in part to a flat price-led growth (0.3%) reported during the period.

On to some exciting news. Air India plans to reinstate 100% of its ‘long-grounded’ fleet since the takeover by the Tata Group around two years ago, sources told FE. According to sources, over 95% of the ‘long grounded’ fleet, which included Boeing 787s, 777s, and some narrowbody Airbus A320 type aircraft, has already been made airworthy. The source said, quote, Many of these aircraft were grounded due to a lack of components and engine shortages. Now that we are witnessing an improvement in the supply chain, the remaining two will also be made airworthy soon, unquote. At the time of takeover by the Tatas, Air India had over 30 ‘long grounded’ aircraft in its fleet, which included both wide and narrowbody planes.

On the other hand. The Reserve Bank of India (RBI) on Tuesday released final guidelines on information technology (IT) governance for regulated entities (REs) like banks, non-bank financial companies, credit information companies and other financial entities. These entities have been mandated to put in place a robust IT governance framework. As per the new guidelines, which will come into effect from April 1 next year, the REs will have to set up a board-level IT strategy committee (ITSC), which will be headed by an independent director and will have three directors as members. Quote, The chairperson of the ITSC shall be an independent director and have substantial IT expertise in managing/guiding IT initiative, unqote, noted the guidelines.

Lastly, let’s know about the stocks you need to focus on today. These include Hindustan Petroleum Corporation, Power Grid Corporation, SJVN among others. State-owned Petroleum Corporation plans to spend Rs 75,000 crore in expansion and diversification in the next five years with an annual expenditure of around Rs 14,000-15,000 crore, the company said on Tuesday. Also, SJVN has received a Letter of Intent for the purchase of 200 MW solar power from Uttarakhand Power Corporation (UPCL). Trent recorded second-quarter profit for the financial year 2023-24 at Rs 234.73 crore, up 152.3% in comparison to Rs 93.02 crore during the same period last year.