Business News at 10:00 am on 13th May, 2024

Let’s begin. Finance Minister Nirmala Sitharaman told FE in an exclusive interview that the Congress’ idea of wealth redistribution was nothing but robbing Peter to pay Paul – something that was not only an outdated approach but also an irresponsible one. She said these are not the days of Robin Hood. She further added, quote, “The methodology Congress has been adopting is very insidious. They have been constantly talking about carrying out X-rays of wealth and caste census. They say their poll manifesto doesn’t talk about wealth redistribution, but their leaders are saying the same thing again and again,” unquote.

On to banking. Central Bank of India expects to recover Rs 4,000 crore from bad loans in the current financial year. The bank aims to increase the share of corporate loans and raise its Credit Deposit ratio by 500 to 700 basis points by the end FY25. MV Rao, MD & CEO, Central Bank of India in an earnings call told analysts said that they would like to grow the business at the rate of 12 to 14% and they want to improve CD ratio from 65 to 70. The bank’s asset quality remained stable during the fourth quarter as its GNPA position was unchanged at 4.50 % of gross advances as of March-end 2024 compared to December-end 2023.

Meanwhile, Tata Group-promoted Air India plans to smooth out issues related to employee fitment as the process for the merger with Vistara is expected to commence on Monday. The integration committee, which includes Vistara and Air India managements, has identified a number of jobs that will be duplicated after the merger. Air India has over 17,000 employees, while Vistara has some 6,500. At a recent town hall meeting, employees were informed that a number of jobs might become redundant after the merger. To avert job losses, the Tata Group plans to offer some employees new roles by upskilling them, and place others in different group companies. Air India and Vistara did not respond to requests for comment.

Over to market. Virat Kohli-backed Go Digit General Insurance expects its solvency ratio to surpass 200% after the initial public offering is completed. Chairman Kamesh Goyal said, quote, “My sense is that after the capital raise, the solvency ratio should exceed 200%. We have not done exact calculation,” unquote. Goyal added that the company does not intend to raise further capital in the near future at least. The Bengaluru-based insurtech company’s solvency ratio fell to 160% in April-December from 190% a year ago. In its draft red herring prospectus, the company stated that the objective of the IPO is to maintain the solvency ratio. The IPO opens for subscription on May 15, and closes on May 17. The price band has been set at Rs 258-272 per equity share.

Moving on. The Centre may increase the outlay for its flagship Mahatma Gandhi National Rural Employment Guarantee Scheme by over Rs 5,000 crore in the 2024-25 full Budget, as demand for work is expected to go up with more houses being built in rural areas, an official told FE. In April, demand under the scheme witnessed a moderation with the month-wise work demanded by households declining 10% year-on-year. In the interim Budget for 2024-25, the allocation for MGNREGS was Rs 86,000 crore. The allocation in the revised estimate for 2023-24 was the same, and official sources say, the allocation was around this level. The official said that they anticipate a rise in demand for work based on an internal assessment.

Next up, industry. The humble agarbatti has caught the attention of some of the country’s best-known FMCGs. Recent months have seen organised players either enter the market or consolidate their existing positions within the market with new and innovative launches. Consider this: Godrej Consumer, best-known for brands such as Cinthol and Hit, has recently stepped into the Rs 1,200-crore anti-mosquito incense-stick market, a sub-segment of the Rs 10,000-crore overall incense stick market in India. The product is called Goodnight Agarbatti. The launch, in a market dominated by unorganised players, is India’s first, legal anti-mosquito incense stick, experts say. In an update last week on the business, GCPL said that Goodknight Agarbatti is winning a share in a market dominated by illegal players.

Lastly, let’s see which are the stocks in focus. These include Tata Motors, SBI, Piramal Pharma, Vedanta, Kalyan Jewellers, Lupin, Zomato, and Indegene among others. Tata Motors’ consolidated net profit soared by 222%, a substantial increase reported in the same period last year. Meanwhile, the company’s revenue from operations grew by 13% to Rs 119,986.31 crore for the quarter under review, compared to Rs 105,932.35 crore recorded a year ago. On the other hand, the SBI, reported a standalone net profit of Rs 20,698.35 crore, up by 24% year-on-year, fueled by heightened interest income and reduced provisions.