Share Market Highlights: Sensex gains 636 points, Nifty crosses 11,030 on reports of withdrawal of tax on FPIs

The Indian currency Rupee gained strength intraday after media reports that the government would roll back the tax recently imposed on FPIs  in the Union Budget 2019-20. The Rupee was trading at 71.07 in the early trade but after the government's announcement of rolling back of tax on FPIs, it gained momentum and is now trading at 70.65, Ajay Kedia, Director with Kedia Commodity told Financial Express Online. 

Paytm’s QR-based payment service PayPay launched in Japan in partnership with SoftBank and Yahoo Japan last October has hit 10-million user target along with 1 million stores and 100 million transactions, Paytm Founder and CEO Vijay Shekhar Sharma tweeted on Thursday. Around mid-July 2019, the service had already acquired 8 million customers in the Japan market. PayPay “aims to promote the broader use of cashless payment in Japan and to provide highly convenient services to both consumers and affiliated stores,” Paytm had said in a blog last year during its launch.

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Early payment platform C2FO, which helps businesses boost their working capital finance has raised $200 million (Rs 1,420 Crore) in a round led by SoftBank Vision Fund. Existing investors including Temasek and Union Square Ventures also backed C2FO in the current round. While accounts receivable or factoring helps businesses particularly SMEs to tide over their cash flow issues by borrowing cash against their receivables or selling them to a company that will pay an amount equivalent to the invoice amount by selling it to a third party, C2FO removes the need to sell to a third party.

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The government is finally mulling withdrawing the surcharge on Foreign Portfolio Investors imposed by Finance Minister Nirmala Sitharaman in her maiden Budget 2019 in July, news agency reports said, sending benchmark indices Sensex and Nifty soaring. The new levy on FPIs had become the scourge of Indian stock markets, with the foreign investors withdrawing money in droves, with the Sensex and Nifty in continuous downfall since the announcement. The government is now considering withdrawing by way of a notification the proposal to levy the surcharge, ET Now reported, adding that the revenue forgone for the government will amount to only about Rs 400 crore.

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Chinese imports of American goods plunged in July as a tariff war with Washington intensified. Imports of US goods fell 19 per cent from a year earlier to USD 10.9 billion, customs data showed Thursday, though that was an improvement over June’s 31.4 per cent fall. Exports to the United States declined 6.5 per cent to USD 38.8 billion. Beijing has retaliated for US tariff hikes in a dispute over trade and technology by imposing its own punitive duties and suspending purchases of American soybeans and other goods.

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The headline indices Sensex and Nifty saw a sudden spurt in Sensex, Nifty are reports that the Narendra Modi-led govt will roll back tax on FPIs. The Sensex is up about 450 points to 37,147, while the Nifty is trading near the 11,000-mark. A government official told CNBC TV18 that the government is likely to roll-back the recently imposed higher tax on Foreign Portfolio Investors (FPIs). Bharti Airtel, HCL Tech, Tata Motors are among the biggest gainers jumping up to 5%. A look at LIVE Sensex heatmap.

The newly minted Union territories of Jammu & Kashmir and Ladakh have fared poorly in generating jobs for its young population. The unemployment rate in the erstwhile state stood at 15.89 per cent in the first four months of 2019, making it one of the worst performers on the job generation front. The figure for the entire country was 6.87 per cent during the period. The educated youth bore the brunt of the lack of employment opportunities in the state. The unemployment rate among graduate job seekers in the Valley stood at 25.2 per cent in the same period, according to the ‘Unemployment in India’ report by CMIE. 

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According to a regulatory filing, Maruti Suzuki, the leading carmaker in India, for the sixth time this year, announced production cuts at its manufacturing facilities. For the month of July 2019, the Indo-Japanese automaker had to cut its production by 25.15 per cent. For the said month, Maruti Suzuki produced a total of 1,33,625 units in comparison to 1,78,533 units during the same period last year. The passenger vehicle production for the company stood at 1,30,625 units during last month as against 1,75,456 units during July 2018, amounting to a decline of 25.6 per cent.

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Shares of India’s major IT firm HCL Tech jumped on Thursday morning, after the firm maintained its revenue and EBIT guidance in constant currency terms. HCL Tech has reported a 7.6% on-year fall in net profit to Rs 2,220 crore for the quarter ended 30th June. HCL Tech guided for 14-16% revenue growth in FY20 in constant currency terms and maintained FY20 EBIT margin guidance of 18.5 to 19.5 per cent. The firm’s total revenue came in at Rs 16,425 crore, up 18.4% on-year and 2.7% on a QoQ basis. The firm has also announced dividend of Rs 2 per share.

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Aluminium prices inched up 0.18 per cent to Rs 140.45 per kg in futures trade Thursday as speculators created fresh positions on spot demand.
On the Multi Commodity Exchange, aluminium contracts for August delivery edged up by 28 paise, or 0.18 per cent, to Rs 140.45 per kg in 758 lots.
Analysts said building up of positions by participants on the back of rising demand from consuming industries in the physical market led to rise in aluminium prices. (PTI)

Mohit Paper Mills' June quarter net PAT 9.3 million rupees versus 3 million rupees year ago. June quarter revenue from operations 375.9 million rupees versus 367.1 million rupees year ago.

IL&FS Maritime infrastructure cuts stake in co by 2.09% to 5.11% via open market sale, said Reliance Naval and Engineering

Shares of Kirloskar Industries soared to Rs 701.95 against the last close of Rs 667 on Thursday after the company reported rise in its Q1FY20 profits. Kirloskar Industries’ June quarter consolidated profit 123.1 million rupees versus 88.6 million rupees a year ago. June quarter consol revenue from operations 4.84 billion rupees versus 4.98 billion rupees a year ago.

Kirloskar Industries’ June quarter consolidated profit 123.1 million rupees versus 88.6 million rupees a year ago. June quarter consol revenue from operations 4.84 billion rupees versus 4.98 billion rupees a year ago.  (Reuters)

Shares in China ended six straight sessions of losses on Thursday as the yuan staged a small recovery, which calmed fears in global markets of a full-blown Sino-U.S. currency war. ** At the close, the Shanghai Composite index was up 0.9% at 2,794.55, while the blue-chip CSI300 index rose 1.3%. ** Haunted by the trade war escalation, the two indexes lost more than 6% in the past six trading days and fitted in and out of negative territory for much of the past month. On Thursday, they recorded the largest daily gains since July 1. (Reuters)

Crude oil futures rose by 2.55 per cent to Rs 3,734 per barrel Thursday after participants widened their bets, tracking a firm trend overseas. On the Multi Commodity Exchange, crude oil contracts for August delivery traded higher by Rs 93, or 2.55 per cent, at Rs 3,734 per barrel with a business turnover of 27,672 lots. (PTI)

Iconic American jeweller Tiffany & Co said it will enter the Indian market in partnership with billionaire Mukesh Ambani's Reliance Industries and plans to open its first store in Delhi this year and one in Mumbai next year. Tiffany, which is known for its diamond engagement rings and robin's egg blue boxes, will be another marquee name to join the ever-growing portfolio of Reliance. In May, it had bought British toy-store chain Hamleys. (PTI)

Gold held steady on Thursday, hovering near the key psychological level of $1,500, supported by uncertainties around Sino-U.S. trade war and a slew of interest rate cuts by global central banks amid fears of an economic slowdown. Spot gold was little changed at $1,499 per ounce as of 0722 GMT. On Wednesday, prices soared over 2% to breach the $1,500 barrier for the first time since April 2013. (PTI)

The BCCI is set to seek advice from an English law firm after the ICC threatened to deduct a part of the Indian cricket board's annual revenue share in a continuing tussle on tax exemptions for events held in India. The Shashank Manohar-led International Cricket Council (ICC) wants complete tax exemption for all global events happening in India and is still awaiting waiver for the 2016 World T20 held in the country. According to the latest documentation of the July 6 Committee of Administrators (CoA) meeting here, the ICC wants to recover the tax burden for the 2016 event by slashing the BCCI annual share from the ICC revenue. (PTI)

In a shocking incident, a murderous assault on the state-run Steel Authority of India Limited (SAIL) Chairman Anil Kumar Chaudhary by four unidentified assailants was reported on Wednesday night in New Delhi while he was on his way back to his residence from office in his official car. The top boss of the PSU Maharatna received injuries on his head, neck, knees and legs as the attackers attacked him with rods and sharp-edged weapons, SAIL said in a statement.

Read more: SAIL Chairman A K Chaudhary attacked by unidentified assailants in Delhi; probe on

Shares of India’s major IT firm HCL Tech jumped on Thursday morning, after the firm maintained its revenue and EBIT guidance in constant currency terms. HCL Tech has reported a 7.6% on-year fall in net profit to Rs 2,220 crore for the quarter ended 30th June. HCL Tech guided for 14-16% revenue growth in FY20 in constant currency terms and maintained FY20 EBIT margin guidance of 18.5 to 19.5 per cent. The firm’s total revenue came in at Rs 16,425 crore, up 18.4% on-year and 2.7% on a QoQ basis. The firm has also announced dividend of Rs 2 per share.  HCL Tech’s Earnings before interest and tax (Ebit) came in at Rs 2,806 crore, down 7.7% on quarterand 2.8 per cent YoY. EBITDA margin decline to 20.7 per cent in the recently concluded quarter, as compared to 23.2 per cent in the year-ago period.

Read more: HCL Tech share price jumps after firm maintains revenue guidance; should you buy or sell stock?

While superior realisation led to better-than-estimated quarterly performance, a sharp jump in operating cost is an overhang for the quarter and does not bode well for the Company. However, considering no meaningful capex for the next two fiscals, we expect JKLC to generate aggregate FCF of Rs10bn, which will also lead to significant recovery in return ratios. As the Current valuations at 5.9x EBITDA and US$48 EV/tonne for FY21E look attractive, we maintain BUY recommendation on the stock with a revised Target Price of Rs 460 (8x of FY21 EBITDA), Reliance Securities said in a report. 

Gold held steady on Thursday, hovering near the key psychological level of $1,500, supported by uncertainties around Sino-U.S. trade war and a slew of interest rate cuts by global central banks amid fears of an economic slowdown. Spot gold was flat at $1,501 per ounce as of 0620 GMT. On Wednesday, prices soared over 2% to breach the $1,500 barrier for the first time since April 2013. U.S. gold futures were down 0.3% at $1,515.20 an ounce. "The moves by central banks around the world are very important, and the focus we are getting on currency markets for potential for competitive devaluation remains supportive for gold," said Michael McCarthy, chief market strategist, CMC Markets. (Reuters)

China's exports beat expectations to rise in July while its purchases continued to shrink, official data showed Thursday, despite simmering US trade tensions.
The trade war with the United States and weakening global demand had weighed on China's manufacturing sector during the first six months of the year, with its global exports roughly flat from a year earlier. But in July China's exports rose 3.3 percent on-year, the customs administration's figures showed, ahead of the one percent drop forecast by a Bloomberg News poll. (AFP)

The French economy is expected to grow 0.3% in the third quarter, the country's central bank said on Thursday, a slight pick-up for the euro zone's second-biggest economy. Last month, official data showed a slowdown in French economic growth, with the country's economy expanded 0.2% in the second quarter, down from 0.3% in the first quarter. (Reuters)

Emami's June quarter consolidated net profit 392.6 million rupees versus 266.6 million rupees year ago. The consolidated revenue from operations 6.49 billion rupees versus 6.14 billion rupees year ago. (Reuters)

The shares of Affle India made an impressive debut on Thursday with its shares listing at Rs 929.90, at a premium of 24.82 per cent over its issue price of Rs 745 per share. Affle India shares hit a high of Rs 958.30 per share on BSE in the early trade today. Last week, the 459 crore-IPO of global technology firm got a stellar response which was subscribed 86.48 times last week. The IPO comprised a fresh sale of shares worth Rs 90 core and a sale of about 4.95 million shares by Affle Holdings. The qualified institutional buyers or QIB portion was subscribed 55.31 times, non-institutional investors 198.69 times and retail investors’ portion was subscribed 10.94 times. The issue had received around 2,96,561 applications across all segments. The proceeds from the fresh issue will be utilised towards inorganic acquisitions and working capital.

Read more: Affle India shares rise 25 per cent on market debut; here are the key details

Ambica Steels Limited, a Delhi-based stainless steel manufacturer, has grabbed the prestigious regional award (Northern) from Engineering Exports Promotion Council (EEPC) for export excellence. The company has won this award on 20th July, 2019 and the award ceremony was held in Shimla, Himachal Pradesh. The EEPC Award was handed over by Hon'ble Chief Minister of Himachal Pradesh Shri Jai Ram Thakur to the company export manager, Mr. Pankaj Singh, who received the award on behalf of Ambica Steels Limited. (PTI)

If you’re hopeful that your loan EMIs will see at least some drop in the near future owing to the Reserve Bank of India’s decision to cut the repo rates for the fourth consecutive time, there’s something else you need to know that will make you happy. In consonance with its Payment Settlement Vision 2019 to 2021, the central bank decided on Wednesday to make National Electronic Fund Transfer (NEFT) available 24×7 from December. Currently, the popular digital payment facility between different bank accounts is only available between 8 am to 7 pm on working days except second and fourth Saturdays. As such, the latest decision is expected to make NEFT transactions way more convenient for users.

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India is soon expected to lead as a unicorn destination with most billion-dollar valuation start-ups emerging out of the country. Due to the close integration of start-ups and conglomerates for delivering tech-enhanced services, the country is expected to churn most number of unicorn companies, a joint report by CREDAI, CBRE said this week. India is currently the third-largest destination for start-ups in the world and fourth in creating unicorns. In 2018, eight unicorns emerged out of India including the food aggregator Zomato, Oyo, Byju’s, Paytm subsidiary Paytm Mall, Udaan and Swiggy. As of now, India’s unicorn start-ups number is just behind the US, the UK and China.

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State Bank of India (SBI), the country’s largest lender, on Wednesday announced a 15 basis point (bps) cut in its marginal cost of fund based lending rate (MCLR) across all tenors soon after the RBI cut its repo rate by 35 bps on Wednesday. With the fourth consecutive rate cut by the RBI in the current fiscal, the one-year MCLR would come down to 8.25% per annum from 8.40% per annum with effect from August 10, 2019, while the MCLR for three years would come down to 8.45% per annum, 8.35% for two year, 8.10% for six month, 7.95% for three month and 7.90% for one month and overnight lending. With this MCLR cut, home loans would become cheaper by 35 bps since April 10, 2019. In addition, SBI is offering a Repo Linked Home Loan Product from July 1, 2019.

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India is the crucible for innovative ideas which can be shared with other developing nations to implement changes that leap-frog women’s empowerment and equality for generations ahead, Anita Bhatia, the newly-appointed Deputy Executive Director of UN Women, has said. UN Secretary-General Antonio Guterres last month appointed Bhatia as Assistant Secretary-General for Resource Management, Sustainability and Partnerships and Deputy Executive Director of the United Nations Entity for Gender Equality and the Empowerment of Women (UN Women).

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Oil futures jumped more than $1 a barrel on Thursday, recovering half of the nearly 5% losses in the previous session, on expectations that lower prices may lead to production cuts. Brent crude had rebounded to $57.75 a barrel, up $1.52, or 2.7%, from its last close by 0401 GMT, while U.S. West Texas Intermediate (WTI) crude futures jumped $1.51, or 2.96%, to $52.60 a barrel. Both contracts hit their lowest levels since January on Wednesday after a surprise build in U.S. crude inventories added to worries that the China-U.S. trade war could further dampen demand growth this year.

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Affle India lists at 25% premium to issue price. Shares of global technology firm Affle India listed at Rs 929 on the exchanges, representing a 25% premium to issue price. Affle India IPO (initial public offering) for Rs 459 crore has turned out to be a blockbuster, as the issue has been subscribed by more than 86 times earlier last week The public offer has received total bids for 29.19 crore as against the issue size of 33 lakh. Non-institutional portion saw the highest demand, with the investors from the category bidding for 199 times their reserved share. QIB’s bid for a total of 56 times their reserved portion, while retail investors bid for a total of 11 times their share. As at the end of yesterday, the initial public offer of Affle India was subscribed 81% on the second day of bidding.

Adani Gas on Wednesday reported a 44% year-on-year (y-o-y) growth in net profit to `79.31 crore for the April-June quarter of 2019, led by increase in sales volume and improved operating margins. The sales volume for the June quarter grew 9% on-year to 137 million metric standard cubic meters per day(mmscmd) on the back of strong growth in both piped natural gas (PNG) and compressed natural gas (CNG) segments. The PNG distribution volume grew 10% on year to 67 mmscmd, while the CNG volume grew 9% to 71 mmscm for the period.

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 The headline indices Sensex and Nifty opened higher tracking global cues. The Sensex is up 170 points to 36,860, while the Nifty is trading near the 10,900-mark. Heromotocorp, HCL Tech, Yes Bank are among the biggest gainers jumping up to 3%. A look at LIVE Sensex heatmap.

Within hours of RBI governor Shaktikanta Das’ unconventional 35 basis points repo rate cut, SBI had dropped the interest rate for fresh loans by 15 bps. That is speedy transmission for sure. However, the fact is there’s a fair bit of catching up left for all lenders since the cumulative repo cuts of 75 basis points till June resulted in a fall of just 29 bps in loan rates. Governor Das’ efforts to revive credit growth are to be lauded but, unfortunately, merely lowering interest rates may not be enough to stimulate appetite for credit. At this point, when there is a fair bit of surplus capacity and visibility on demand—both locally and overseas—is somewhat poor, the private sector has no real incentive to invest. 

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