Friday, 6th May 2022

Nitin Gadkari, the ubiquitous Minister for Road Transport and Highways, has promised a record 18,000 KM of highways in FY23 at the rate of 50 KM per day. The daily target is 50% higher than last year. In the Budget speech, Nirmala Sitharaman had committed 25,000 KM of national highways. He also added that the 1400-km trunk Delhi-Mumbai expressway was 60% complete and he targeted 90% completion by Dec-22. The Delhi-Mumbai expressway costs Rs.100,000 crore and could be a real game changer for logistics.

On Thursday, NASDAQ reacted negatively to news of 50 bps rate hike by the Fed. They were more worried about the hawkish outlook for rates. Even as the NASDAQ dropped over 5% on Thursday, the hard hit stocks were the likes of Google, Apple, Microsoft, Meta, Tesla and Amazon. The sharp spike in the dollar to a 20-year high is a dampener for the export driven tech stocks. On the main board, all the 11 major sectors fell with consumer discretionary and technology the worst hit. CBOE VIX spiked to above 31 levels.

TVS Motors reported 5% fall in profits. Even on a sequential basis, profits were down 5%. However, revenues for the quarter were up 4% at Rs.5,530 crore, while full year revenues were up 24% yoy. Despite the supply chain constraints, EBITDA margins improved by 70 bps to 10.1%. FY22 recorded the highest ever sales and profits for TVS Motors. Motorcycle sales in FY22 rose 29% to 17.32 lakh units while scooter sales were lower. The big boost came from international sales jumping by 43% to 12.53 lakh units in FY22.

The LIC IPO has already generated bids worth Rs.20,744 crore (including anchor bids) and the issue is subscribed just about once. However, the QIB, HNI and retail portions are still short of being filled up. The real oversubscription has come from employee and policyholder quota. The LIC IPO has already seen retail participation from over 36 lakh individual investors and is expected to cross the 1 crore mark by close of the issue on Monday. The QIB portion and HNI portion typically see maximum response on the last day.

Dabur India reported 21.98% fall in net profits at Rs.294.34 crore for Q4. Sales was up 7.74% at Rs.2,518 crore. The company has witnessed weak sales on the rural front and that has been responsible for the sequential pressure on sales. Rural India has been faced with rising inflation and pressure on income levels in this quarter. Margin pressures were visible in the counter from a spike in the costs of a number of key raw materials. Total expenses for the 4th quarter were up 8.7% yoy at Rs.2,141 crore, weakening profits.

All is not well with the EDTECH companies. After Unacademy and Lido Learning laid off employees to cut costs, it is now the turn of another market leader, Vedantu, to cut jobs. Vedantu is expected to lay off 200 employees; about 3.5% of its staff strength. However, Vedantu has taken pains to underline that they are also recruiting about 1,000 people fresh. It is reported with regular classes and tuition commencing, the edtech companies are seeing their demand wane after 2 years of bumper growth during COVID-19.

After successful forays into power, renewable energy, ports, FMCG products and airports; Gautam Adani is eyeing the media sector. The group may look to buy stakes in local television and print news outlets. Several deals are currently being studied. Controlling media is not just about profits but about the clout and about syncing futuristic content with a digital strategy. Adani has already established AMG Media Networks, which is headed by Sanjay Pugalia. It is also looking to buy a stake in Quintillion Business Media. 

Paytm announced that it had already tokenised 2.80 crore cards across Visa, Mastercard and RuPay; as stipulated by RBI. By 30th June,  Paytm also plans to purge all saved card data, as per RBI diktats. Paytm had already recognised the need for tokenised cards and implemented the same on its app. Tokenization makes online card transactions safe and secure. Tokenization entails replacement of actual card details with an alternate code called the token. This will do away with websites storing your card information.