Tag: Airtel

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Wipro Posts 9% YoY Fall in Net Profit in Q2 – Top Indian Market Updates

Here are some of the major updates that could move the markets tomorrow:

Wipro Q2 Results: Net profit falls 9% YoY to ₹2,660 crore

Wipro Ltd reported a 9.2% YoY decline in consolidated net profit to ₹2,659 crore for the quarter ended March (Q2 FY23). Its revenue from operations rose 14.6% YoY to ₹22,539.7 crore during the same period. In constant currency terms, the IT services segment revenue increased by 4.1% QoQ and 12.9% YoY. Wipro’s order bookings during the quarter grew by 23.8% YoY. Wipro’s results are below street estimates.

Read more here. 

Retail inflation rises to 5-month high of 7.41% in September

India’s retail inflation, measured by the Consumer Price Index (CPI), rose to a five-month high of 7.41% in September. CPI stood at 7% in August. Inflation in the food basket rose to 8.60% in Sept from 7.62% in August. The fuel and light segment rose 10.39% last month.

India’s factory output, measured by the Index of Industrial Production (IIP) witnessed a contraction of (-)0.8% YoY to 131.3 in August.

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HCL Tech Q2 Results: Net profit rises 7% YoY to ₹3,489 crore

HCL Technologies Ltd reported a 7.1% YoY (or 6.3% QoQ) increase in consolidated net profit to ₹3,489 crore for the quarter ended March (Q2 FY23). Its revenue from operations rose 19.5% YoY to ₹24,686 crore during the same period. The total contract value of deals rose 6% YoY and 16% QoQ to $2.38 billion in Q2. The IT company’s board has declared a dividend of ₹10 per share.

Read more here.

Airtel tops 4G download speeds, Jio in coverage: OpenSignal

According to an OpenSignal report, Bharti Airtel users enjoyed the best quality of service on 4G networks with the fastest download speeds, while Reliance Jio had the best coverage. Users on Airtel clocked 13.6 Mbps download speeds, marginally faster than Vodafone Idea and Reliance Jio by 0.3-0.6 Mbps. Airtel delivered a superior experience in streaming videos, multiplayer gaming, and OTT services.

Read more here.

Adani Renewable Energy Holding Four sets up two subsidiaries

Adani Green Energy Ltd’s arm Adani Renewable Energy Holding Four has incorporated two new subsidiaries. These two subsidiaries are Adani Renewable Energy Forty Four Ltd (ARE44L) and Adani Renewable Energy Forty Eight Ltd (ARE48L). The main objective of the subsidiaries is to generate, develop, distribute, transmit, and supply power or electrical energy using any renewable sources of energy.

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HFCL secures order worth ₹40 crore

HFCL has received purchase orders aggregating to ₹39.19 crore from Reliance Projects & Property Management Services. The order is for rolling out a long-distance fibre network by one of the leading operators in various telecom circles. The orders are to be executed by May 2023. HFCL is a technology company that makes high-end transmission equipment and optical fibre cables (OFC).

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Coal India partners three PSUs for four gasification projects

Coal India Ltd (CIL) has signed agreements with Bharat Heavy Electricals Ltd (BHEL), Indian Oil Corporation Ltd, and GAIL (India) Ltd to set up four surface gasification projects. It aims to gasify 100 million tonnes (MT) of coal into syngas for use in the downstream production of value-added chemicals in the next eight years. In the first phase (from 2020-2024). 4 MT will be gasified with an investment of ₹20,000 crore. 

Sonata Software signs business transformation deal with Ireland-based eir evo

Sonata Software Ltd has signed an agreement with eir evo to support the standardization of their customer relationship management (CRM) platform, migrating them from Salesforce to Microsoft Dynamics. Ireland-based eir evo leading telecommunications and Information & Communications Technology (ICT) solutions provider.

Sonata Software and eir evo also plan to implement a long-term strategy for growing Microsoft Dynamics within the Irish market.

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Tata Power partners with 75F Smart Innovations for energy-efficiency solutions

Tata Power Trading Company Ltd (TPTCL) has signed an agreement with 75F Smart Innovations India to jointly promote automation and energy-efficiency solutions in the commercial building space. TPTCL is a wholly-owned subsidiary of Tata Power. The entities will help businesses optimize their energy consumption and usage. They will offer solutions in the areas of heating, ventilation, and air conditioning (HVAC) optimisation and smart building automation.

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Centre approves one-time compensation of ₹22,000 crore for OMCs to recover LPG losses

The government has granted a one-time compensation of ₹22,000 crore for Oil Marketing Companies (OMCs) in view of the rising under-recoveries due to rising LPG prices globally. LPG prices have surged globally up to 300%, while in India it has not gone up as much leading to under-recoveries of OMCs. The compensation will be rolled out to Indian Oil Corporation, Hindustan Petroleum Corporation, and Bharat Petroleum Corporation (BPCL).

Read more here.

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Rupee Hits 80 per US Dollar At Record Lowest – Top Indian Market Updates

An employee counts U.S. dollar bills at a money exchange in central Cairo, Egypt, March 20, 2019. REUTERS/Mohamed Abd El Ghany./File Photo

Here are some of the major updates that could move the markets tomorrow:

Rupee Hits 80 per US Dollar At Record Lowest

On July 19, 2022, Tuesday, the Indian Rupee to US Dollar conversion rate hit a new record low at Rs 80 per US Dollar in the interbank spot exchange. The rising trade deficit, continuous outflow of foreign portfolio investors, and rising crude oil prices are some of the reasons that are said to have kept the rupee under pressure.

HDFC Life Q1 Results: Net profit rises 21% YoY to Rs 365 crore

HDFC Life Insurance Company Ltd reported a 21% YoY increase in net profit to Rs 365 crore for the quarter ended June (Q1 FY23). Total premium rose 21% YoY to Rs 9,396 crore during the same period. The first-year premium collection grew 27% to Rs 4,776 crore in Q1. The company’s subsidiary, HDFC Pension, crossed the Rs 30,000 crore assets under management (AUM) mark and has almost doubled its AUM in just 15 months.

Read more here.

SpiceJet launches 26 new domestic flights

SpiceJet Ltd has announced the launch of 26 new domestic flights. The airline will connect Nashik with Hyderabad and Delhi with Khajuraho under the UDAN scheme with new and additional flights starting July 22, 2022. The airline will also reduce direct flights to Nashik from Delhi, Hyderabad to Jammu, Mumbai to Guwahati, Varanasi to Ahmedabad, and Kolkata to Jabalpur. SpiceJet will deploy Boeing 737 and Q400 aircraft on these routes.

Read more here.

DLF aims to double retail presence in 4-5 years, building new malls

DLF Chairman Rajiv Singh said the company has initiated the development of new shopping malls and looks to double its retail portfolio in the next five years. At present, DLF has a retail footprint of 42 lakh square feet comprising eight properties, including malls and shopping centres mainly across Delhi-NCR. The company would also scale up the development of housing and office projects.

Read more here.

Indian Oil, NTPC form JV to set up a renewable energy-based power plant for refineries

NTPC Ltd has signed an agreement with Indian Oil Corporation Ltd (IOCL) to form a joint venture (JV) to meet the power requirements of IOCL’s refineries. Through this JV, Indian Oil plans to meet the additional power requirement of its refineries using round-the-clock renewable energy of up to 650 megawatts (MW) by Dec 2024. NTPC Green Energy Ltd (NGEL) will form the JV company to supply RE-RTC power to IOCLl.

Read more here.

HUL Q1 Results: Net Profit Up 11%

For the quarter ended June 30, 2022, Hindustan Unilever recorded an 11% increase in standalone net profit at Rs 2,289 crore as compared to Rs 2,061 crore in the same quarter last year. Revenue from operations increased by 19.48% YoY to Rs 14,016 crore from Rs 11,730 crore in the same quarter last year. Home Care delivered 30% growth driven by strong Fabric Wash and Household Care performance. Both categories grew in high double-digits with all parts of the portfolio performing well. 

Read more here.

Reliance Jio adds 31 lakh new mobile users in May; Bharti Airtel adds 10.27 lakh users

Reliance Jio Infocomm gained 31 lakh mobile subscribers in May 2022, taking its total user base to 40.97 crore. Bharti Airtel added 10.27 lakh users, and its total mobile subscriber count rose to 36.21 crore. Vodafone Idea lost nearly 7.59 lakh mobile subscribers during May, and its total subscriber base fell to 25.84 crore.

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Russia defaults on LNG supplies to India. 

As a result of Russia’s retaliatory sanctions against one of the gas suppliers to India, at least five cargoes or shiploads of LNG have not been delivered by Russia to India. India’s GAIL Limited, a government-owned natural gas explorer and producer, has a long-term agreement to purchase 2.85 million tonnes of LNG a year from a Singapore-based subsidiary of Russian gas producer Gazprom.

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Jio deposits the highest earnest money in the race for 5G Spectrum

Competing against Airtel, VI and Adani, Reliance Jio has deposited Rs 14,000 crore, with the DoT as earnest money deposit (EMD). An EMD is an amount that a buyer gives to the seller to show an inclination to successfully complete a deal. Adani Data Networks has deposited just Rs 100 crore, suggesting that the giant might buy spectrum only for airwaves in a few circles for the enterprise or limited use. Airtel and VI both deposited Rs 5,500 crore and Rs 2,200 crore, respectively. 

Read more here.

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SBI Q2 Net Profit Rises 67% – Top Indian Market News

sbi

SBI Q2 Results: Net profit rises 67% YoY to Rs 7,626 crore

State Bank of India (SBI) reported a 67% YoY increase in net profit to Rs 7,626.5 crore for the quarter ended September (Q2 FY22). Net profit increased 17% compared to the previous quarter. Its net interest income (NII) rose 10.6% YoY to Rs 31,184 crore during the same period. The gross non-performing assets ratio (GNPA) stood at 4.90% in Q2 FY22, compared to 5.32% in Q1 FY22. Provisions against bad loans stood at Rs 2,699 crore in Q2, down 52% YoY.

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India’s services PMI grows at the fastest pace in over a decade in October

India’s services sector activity expanded at the strongest pace in ten-and-a-half years in October. The IHS Markit India Services Purchasing Managers’ Index (PMI) stood at 58.4 in October, compared to 55.2 in September. Companies indicated that a notable pick-up in new business led to the fastest expansion in output in over a decade, and as a result, more jobs were created. However, business confidence remained subdued due to growing inflationary concerns. PMI is a month-on-month calculation, and a value above 50 represents an expansion when compared to the previous month. 

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Infosys collaborates with Shell to Market Shell Inventory Optimizer Solution

Tech-giant Infosys has announced a collaboration with Shell Global Solutions International B.V. (Shell) as the commercialization partner of the “Shell Inventory Optimizer” solution targeted towards energy companies. The “Shell Inventory Optimizer” uses Artificial Intelligence to optimize warehouse inventory levels based on historical consumption. This will allow energy companies to improve demand planning, reduce time and labour, and bring down cost of operation.

Read more here. 

Zee Ent. To Announce Q2 Results on Nov 27 Amidst Shareholder Turmoil

Zee Entertainment has announced November 27, 2021, as the date for a board meeting to announce quarterly results (Q2). This comes after the company had cancelled its results meet on October 27, 2021, citing a lack of quorum. ZEEL’s single-largest shareholders Invesco Developing Markets Fund and OFI Global China Fund LLC who hold 17.88% stake in the company jointly have been pressing for an extraordinary general meeting(EGM) for the removal of its Managing Director Punit Goenka, besides opposing Zee’s proposed merger deal with Pictures Network India (SPNI). Two of Zee’s independent board members Manish Chokhani and Ashok Kurien have already resigned amidst certain allegations. The two major shareholders and Zee have locked horns with Invesco and OFI Global approaching the Mumbai Bench of the National Company Law Tribunal (NCLT) whereas Zee has approached the Bombay High Court leveling allegations against each other resulting in an ugly public spat. 

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Vodafone Idea: Co Partners With Nokia India For 5G Trials

Vodafone-Idea(VI) and Nokia have announced their partnership to test 5G using ‘E-Bands’ in areas where fiber is challenging to deploy. The two claimed a speed of 9.85 Gbps while testing the 5G networkings. “We are delighted to partner with Vi in trials to deliver 5G services by connecting small cells & macrocells with fiber-like speed through E-Band, in areas where fiber is challenging to deploy”, said Nokia in a tweet. 

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Hindalco Industries to acquire Polycab’s 100% stake in Ryker

Hindalco, the Aditya Birla Group’s flagship metal company has announced the acquisition of a 100% stake in Ryker Base Pvt. Ltd., a wholly-owned subsidiary of Polycab Industries for an enterprise value of Rs 323 crore. Ryker owns a 225,000-ton plant to manufacture cast and rolled copper wire rods. On the other hand, Hindalco owns the world’s largest single-location custom copper smelters at Dahej in Gujarat, with a capacity of 345,000 tons.

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Adani Power Get NCLT Nod To Acquire Essar’s 1,200 MW Mahajan Project 

Adani Power got approval from the National Company Law Tribunal to acquire Essar Power’s 1,200 MW thermal power project in Mahan, Madhya Pradesh. The Principal Bench of NCLT at New Delhi approved Adani Power’s resolution plan to acquire EPMPL (Essar Power M P Ltd) which is currently undergoing bankruptcy proceedings.

Read more here.

ABFRL Q2 Results: Consolidated Revenue Doubles!

Aditya Birla Fashion and Retail Limited (ABFRL) reported a net profit of Rs 5 crore this quarter against a net loss of Rs 188 crore last year in the same quarter. The consolidated revenue doubled YoY to Rs. 2054 crore from Rs 1028 crore in the same period. The company’s overall business recovered to 90% of pre-COVID levels where the Branded Business recovered to over ~95% of normalized level and Pantaloons to ~73% of pre-COVID levels. Additionally, the E-commerce business grew by 74% over last year. The company added 160+ stores across businesses during the quarter.


Read more here. 

Eicher Motors Q2 Results: Profit After Tax Grows 9%

Eicher Motors reported a net profit of Rs 373 crore, growing at 9% YoY and 44% QoQ. The consolidated revenue of the company stood at Rs 2,250 crore, up 5.4% from the same quarter of the previous financial year. Royal Enfield sold 123,515 motorcycles during the quarter, a decline of 17.2% from 149,120 motorcycles sold over the same period in FY 2020-21. Royal Enfield ended the quarter with the best ever performance in international markets for the second successive quarter with total exports at 17,922 units, more than 132% increase over 7,714 in the same period last year. VE Commercial Vehicles, a joint venture between Volvo and Eicher reported a profit of Rs 9 crore against a loss of Rs 3.85 crore in the same quarter last financial year. 

Read more here.

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Market News Top 10 News

Future Retail Files New Case Against Amazon Over Deal – Top Indian Market News

Future Retail Files New Case Against Amazon Over Deal

Kishore Biyani’s Future Retail has filed a fresh lawsuit against Amazon in the Supreme Court. Amazon owns a critical stake in Future Retail. Amazon won an arbitration order that stalled Reliance’s decision to acquire Future Group. Future Group has argued that if the deal with Reliance doesn’t go through, it would cause unimaginable damage to the group, It could mean possible job losses for 35,575 employees and risk Rs 28,000 crore in loans and debentures.


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Ami Organics IPO to Open Next Week

Specialty Chemical maker Ami Organics is set to launch its IPO next week on September 1, 2021.  The company manufactures different types of Advanced Pharmaceutical Intermediates and Active Pharmaceutical Ingredients (API). The company has three manufacturing plants in Gujarat situated at Sachin, Ankleshwar & Jhagadia, with an installed capacity of 6,060 MTPA. The company intends to raise Rs 570 crore through the IPO. The price band is set at Rs 603 to Rs 610 per equity share

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Airtel to Get Investment From Google

According to a TOI report, Google is now planning to invest money in telecom operator Bharti Airtel. It is reported that Google’s investment in Airtel could be substantially large running into several thousand crores of rupees. Google has invested a whopping Rs 33,737 crore and currently holds a 7.73% stake in rival platform Reliance Jio.

Read More Here 

EPF-Aadhar Link Mandatory From September 2021

The Employees’ Provident Fund Organisation(EPFO) has tweaked some rules regarding PF accounts. As per the latest update, your employer can credit money to your PF account only if your account is linked to your Universal Aadhar Number(UAN). 

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Grasim to Invest Rs 5000 Crore in Paints Business

Aditya Birla Group’s Grasim Industries has approved a Rs 5000 crore CAPEX mainly towards its paint business. It has earmarked Rs 2600 crore CAPEX for the current financial year FY22. The proceeds would be mainly towards its viscose staple fiber (VSF) and chemicals business.

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FDI Equity Inflows Up 168% to Rs 1.3 Lakh Crore in Q1

Foreign direct investment (FDI) into the country increased twofold to Rs 1.3 Lakh Crore or USD 17.57 billion during April-June this fiscal. The rise is attributed to measures such as policy reforms and ease of doing business. The FDI in the same quarter last year was USD 11.84 billion or Rs 87,000 Crore.

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Jandhan Bank Accounts Rise to 43 Crores, Amount to Rs 1.46  Lakh Crore

As of August 18, 2021, Pradhan Mantri Jan Dhan Yojana accounts stood at 43 crores, totaling a Rs 1.46 crore balance in beneficiary accounts. Of this close to 55.47 percent (23.87 crores) Jan-Dhan account holders are women and 66.69 percent (28.70 crores) holders are in rural and semi-urban areas. Moreover, 36.86 crores or 85.6 percent are operative, and the average deposit per account is Rs 3,398, as per the statement

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Editorial

Why Airtel Leads In Its Race Against Jio

There was a time when India’s telecom industry had a vibrant spectrum. One could choose between at least 6-7 telecom operators. Things took a hit when Jio was launched in India. India’s telecom industry was now reduced to only three private players. They are Jio, Airtel, and VI(Vodafone Idea). Airtel and Vodafone-Idea are currently burdened by debt(Read More On AGR Dues). Now the race is mainly limited to Airtel and Jio.

Airtel and Jio currently lead the market in terms of subscriber base. Bharti Airtel, despite being financially weak, has been giving a stiff competition to Mukesh Ambani-owned Jio Infocomm. That makes some spectators ask, what makes Airtel so special? Can Airtel lead in the race against Jio? In this piece, we explore the factors that have made Airtel more viable in recent months and what lies beyond it. 

Airtel Q4 FY 2020-21 Result Highlights

  • Bharti Airtel published its quarterly results for Q4FY21 on Monday, May 17, 2020. The results, although fairly good, were below analysts’ expectations. The share price of Airtel was down 2.25% by end of the day. 
  • Bharti Airtel’s revenue stood at Rs 18,338 crore, up by 17.5% as compared to last year, but down by 2.9% as compared to last quarter. 
  • The net profit for the quarter was Rs 759 crore, as compared to a loss of Rs 5,237 crore in the same quarter last year. 
  • The company’s Average Revenue Per User(ARPU) fell to Rs 145 from Rs 166 over the past year. The company grew its 4G customer base by 4.3 crores(~31%) over the year. The 4G customer base grew by 8.3% QoQ. 
  • The company’s mobile business revenue grew by ~19%. Its broadband revenue(Airtel Home Services) grew by~ 27% YoY adding 2.74 lakh subscribers in the segment this quarter.
  • Geographically speaking, Airtel’s majority revenue comes from two countries, India and Africa. Airtel Africa’s revenue grew by 21.7% YoY in Q4FY21.

Airtel Vs. Jio: A Tough Run?

Airtel has managed to stand strong on its feet despite strong competition from Jio. There are reasons to believe that Airtel might come up stronger. There are some factors to consider though.

Subscriber Base

As of March 2021, Jio leads the market with a total of 41 crore subscribers, whereas Airtel has 34.4 crore subscribers. 

However, it should be noted that not all of Jio’s subscribers are actively using its services. According to TRAI, the ACTIVE subscriber rate of Jio was just 78.15%. For Airtel, 97.47% of its subscribers were active on their network, beating Jio by a staggering ~20%.

In January 2021, Airtel added 3 times MORE subscribers than Jio. Airtel added close to ~6 crore subscribers in January, whereas Jio added only ~2 crore subscribers beating Jio for six straight months. However, Jio managed to get back at its game in February adding 6 lakh more subscribers than Airtel. The second COVID wave can severely impact Airtel’s subscriber count.

Broadband Business

According to TRAI data, Jio is leading the broadband business in India having ~41 crore subscribers versus Airtel which has ~17 crore subscribers.

However, Airtel’s broadband game should not be undermined. With its flagship product Airtel Xtream, Airtel was clocking in 10,000-20,000 subscribers per month which has now increased to 90,000 subscribers a month. Airtel has onboarded many small-time cable operators adding more than 72 cities to its list in the first 3-4 months of 2021. It offers bundled packages where one can avail of internet services, TV channels, and OTT platforms all in one. It has also been catering Work-From-Home packages of individuals and corporates. 

Non-Telecom Business

Jio earns only 6% of its income from non-mobile businesses. Airtel on the other side earns close to ~21% of its revenue from non-mobile businesses. This serves as a relative advantage to Airtel since a deface on the telecom business won’t affect the other side. Airtel’s non-telecom businesses include Airtel Xtream, Airtel DTH, Airtel Payments Bank, etc.  

Airtel Africa

During the COVID-19 lockdown period, while Airtel India lost close to 80 lakh subscribers in the first quarter of this year, Airtel Africa GAINED close to 1 crore subscribers. Airtel Africa contributed to 30% of Bharti Airtel’s consolidated revenue and has been increasing consistently over the past few years. In November 2020, we at marketfeed did a piece on Airtel Africa’s business model and everything that it was doing right. You can check out the article over here.

5G

Jio has already announced that it is planning to launch 5G in India. Airtel had announced last year that it had already tested its 5G network at an industrial area in Hyderabad. Nevertheless, Jio is running for the money when it comes to 5G networks. This is because it is not ‘burdened’ by the impediments arising from the existence of 2G or 3G cellular networks, unlike Airtel. To be specific, there are some fixed costs associated with owning  2G and 3G cellular towers, with a shrinking user base for these services. Owning 2G and 3G spectrum might not turn out to be cost-effective for Airtel. Moreover, Jio has actively been working on acquiring or partnering with companies involved in taking the 5G project ahead.

What Lies Ahead?

Airtel’s ARPU fell sharply from Rs 166 to Rs 145. Besides, Reliance Jio’s ARPU fell from Rs 151 to Rs 138 this quarter. What was the reason for this fall? The fall in ARPU was due to scrapping of the Interconnect Usage Charge(IUC) by TRAI. IUC was paid by one carrier to another whenever its customers made voice calls to a phone number in the rival network. The more a carrier receives calls from another carrier, the more money it would make by IUC. Jio was a net receiver of IUC, while Vodafone was a net giver. Airtel was somewhere in between. Yet, the scrappage of IUC did impact Airtel considering that it was the second-largest telecom operator in the country. Jio was affected a little more. 

What is worth noting is that Airtel has managed to grow in business given the unfavorable circumstances in the telecom sector. There is definitely some good work going on in its management and strategy side. Airtel has announced a set of free recharge packages for its low-income consumers benefiting more than 5.5 crore users amidst the ongoing COVID-19 second wave. While Airtel continues to expand its footprint, and with the 5G spectrum around, it would be worth noting how Airtel performs throughout the COVID-19 second wave and how it plans to compete in the 5G regime.

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Vodafone Idea increases Postpaid Tariffs

VI - Vodafone idea

Vi has increased their prices of Rs 598 and Rs 749 postpaid plans. The third largest telecom company in India has increased their prices of two postpaid plans by Rs 50. Considering their financial condition it is necessary for them to increase their Average Revenue Per User (ARPU). The ARPU of Vi is Rs 119 which is very low when compared with ARPU of Airtel and Jio, Rs 162 and Rs 140 respectively.

Vi is also trying hard to increase the users of their network but unfortunately they are losing more and more users as per the report by the Telecom regulatory Authority of India (TRAI). This might be the reason why the share price of Airtel is going up. There could also be a similar move from Bharti Airtel, they are also in need of funds to pay off their obligations.

The Q2 results of Vi has reduced its loss to Rs 7,203 crore from Rs 25,467 crore. The company is reeling from trying to pay off AGR dues. They are trying to get funds to expand and develop their network services and also to pay off their huge debt. The company had also announced that they would not be bidding in the upcoming 5G spectrum auction. There are also reports that claim Vi has become the fastest 4G telecom provider in India.

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CCI approves Future Group-Reliance Retail deal – Top Indian Market News

CCI approves Future Group-Reliance Retail deal

Competition Commission of India (CCI) has approved the much-anticipated Future Group-Reliance Retail deal. Commission approves acquisition of retail, wholesale, logistics & warehousing businesses of Future Group by Reliance Retail Ventures Limited and Reliance Retail and Fashion Lifestyle Limited.” Commission approves acquisition of retail, wholesale, logistics & warehousing businesses of Future Group by Reliance Retail Ventures Limited and Reliance Retail and Fashion Lifestyle Limited”, CCI posted on Twitter.

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To know more about the Retail War between Amazon, Future Group, and Reliance, Click Here

Bharti Infratel gains 13% over completion of merger with Indus Towers

Bharti Infratel has completed its merger with Indus Towers which manufactures and maintains telecommunication towers and other network devices. After the merger, Vodafone which sold 11.5% of its stake in Indus Towers received ₹3,760 crores. Vodafone will continue to hold ~28% stake in the merged entity. The Board has appointed Bimal Dayal as the Chief Executive Officer of the merged entity

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SEBI asks Subrata Roy to pay up Rs 62,600 crore to avoid jail time

The Supreme Court of India in 2012 had ruled that Sahara group companies violated securities laws and illegally raised over Rs.26,000 crores. SEBI has now asked Subrata Roy to pay up Rs.62,000 crores after making additions and interest to the amount. Roy so far has deposited Rs. 15000 crores. Roy’s story was featured in the NetFlix series Bad Boy Billionaires.

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Vaccine to be ready by April 2021: Serum Institute CEO

Serum Institute of India’s CEO Adar Poonawalla on Thursday has said that the Oxford Covid-19 vaccine would be ready for healthcare workers and elderly people by around February 2021 and for the general public by April 2021. Serum Institute may sell covid-19 vaccine Covishield at around ₹500- ₹600 per dose in the private market.

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Gland Pharma Lists at 14% premium over issue price

Gland Pharma’s IPO  was sold between November 9 and 11, was subscribed 2.06 times in a three-day bidding process, with the HNI and retail quotas undersubscribed. It made a strong market debut closing in at Rs.1,710, close to 14% above its issue price of Rs. 1500

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PM Modi, Bhutanese PM launch RuPay card Phase-II

Prime Minister Narendra Modi along with the PM of Bhutan Lotay Tshering jointly launched RuPay card Phase-II that will allow Bhutanese card holders to access the RuPay network in India. RuPay, just like Visa and Mastercard, is an Indian debit and credit card payment network which can be used at ATMs, payment counters, and for online transactions across India.


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Maharashtra May Stop Flights, Trains Coming From Delhi Due to rising Covid Cases

According to sources, the Maharashtra government is contemplating halting flight services from Delhi to Mumbai in the wake of rising COVID-19 cases in the national capital region. Train services between Delhi and Mumbai could also be stopped.

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Haryana Health Minister gets first Covaxin Dose as Bharat BioTech kicks off Phase III Testing

Haryana Health Minister Anil Vij was given the first trial dose of the COVID vaccine Covaxin at Civil Hospital, Ambala Cantonment. Covaxin, a potential Covid-19 vaccine, is being developed by Bharat Biotech jointly with the Indian Council of Medical Research (ICMR).

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Petrol, Diesel Price Hike For First Time In Two Months.

Global oil prices are up after almost a 2-month hiatus after multiple successful COVID-19 vaccines were announced. This has caused a hike in petrol and diesel prices across India.

The price of petrol has increased by 17 paise per litre in Delhi. In Mumbai, petrol prices went up from Rs. 87.74 per litre to Rs. 87.92, while diesel rates went up from ₹76.86 to ₹77.11.

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9 Apple Inc Units Shifted From China to India during COVID-19 Lockdown

Union IT minister Ravi Shankar Prasad Bengaluru at the Bengaluru Tech Summit said that during the COVID lockdown period nine operating units, along with component makers, shifted from China to India.

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Editorial

Airtel: Struggling in India, Thriving in Africa

Airtel has been in bad waters in India for almost a decade. There are some reasons for it. Firstly, there are the taxing regulations and interventions by the TRAI or the Telecom Regulatory Authority of India. Then comes the one-and-only, Reliance Jio, which changed the face of the Indian telecom industry. The price competition that it offered threw a major blow to its counterparts in India. Airtel was one of them. However, in a land far far away, Airtel seems to be making some big bucks. That land is the African Sub-Continent. So what makes Airtel Africa different from Airtel India?

The Market Of Airtel Africa

Airtel Africa consists of 14 countries under it. The biggest market for Airtel Africa is Nigeria, which contributes to more than 40% of its total revenue. Africa is an unexplored place in terms of telecom ventures, therefore Airtel saw potential in exploring Africa for a stint in telecom. Airtel Africa was officially launched in June 2010. Since then Airtel Africa has gained a subscriber base of 111 million people, which is 11.1 crore users. 

Why did Airtel choose Africa of all places though? What separated the African telecom market from the Indian market is its low-competition, its low population density, easy availability of spectrum, no strict regulatory authority in Africa unlike the TRAI in India. Also cheap availability of resources like land and labour, and finally, the immense potential in the unexplored African telecom market also makes the market very lucrative. 

Airtel Africa also has its own mobile money service, Airtel Money, which includes payments systems, micro-loans, savings, and international money transfers with an 18 crore user base. Airtel Money contributes close to 9% of Airtel Africa’s total revenue. Through this Airtel is promoting financial inclusion in the region.


Is Airtel Africa a lifesaver? 

  • Airtel Africa contributes close to 23% of Bharti Airtel’s total revenue. After the pandemic, the September 2020 Q2 that the contribution of Airtel Africa to the consolidated revenue increased by 5%.
  • During the COVID-19 lockdown period, While Airtel India lost close to 80 lakh subscribers in the first quarter of this year, Airtel Africa GAINED close to 1 crore subscribers. The COVID-19 pandemic did not impact the financials of Airtel Africa as much as it impacted Airtel India’s performance. This is because of the low population density and far fewer COVID-19 cases in Africa, as compared to the rest of the world. 
  • Airtel Africa’s ARPU or Average Revenue Per User is generally 35-40% more than that of Airtel India’s. Airtel Africa’s ARPU was Rs 210(or $2.8) as compared to Rs 162 for Airtel India as of September 2020. This is mainly due to less competition, unlike in India.
  • Coming to deploying funds ‘efficiently’, Airtel Africa is performing much better than Airtel India. Airtel Africa’s average Return on Capital Employed(Read as Capital Invested) is 13% as compared to Airtel India’s 6%, over a period of five years. This means that for every Rs 100 of capital invested Airtel Africa makes Rs 13 as profit, whereas Airtel India makes only Rs 6 as profit.
  • Airtel Africa, which was a debt-ridden company since inception, has almost halved its debt over the years. Whereas Airtel India continues to mount more and more debt, with the AGR dues issue adding fuel to the fire. The Debt/Equity ratio has decreased over the years for Airtel Africa. The Debt/Equity ratio shows how much a shareholder is exposed to debt-related risk. The lower the ratio, the better the financial health of the company.

The company is also looking to sell its tower assets to reduce debts, While the world is racing towards 5G, Africa hasn’t touched the finishing line for 4G. Due to the low population density, telecom operators have to spend more on infrastructure to cover a greater user base.

The higher cost of deployment makes it harder for telecom operators to roll out 4G and increase its coverage. Since the coverage for 4G is less, users prefer switching to 2G/3G for its convenience. Sub-Saharan Africa still awaits investment in 4G technologies, 4G is where the investment potential lies and unused 4G capacity. Companies like Vodacare, MTN, and Airtel Africa are filling that gap.

Having adopted the correct cost management strategies, debt management, and marketing, Airtel Africa is filling the gap for 4G and possibly even 5G. Airtel Africa has recently spoken on its ‘readiness’ on 5G technology in Nigeria.

If Airtel Africa maintains its current subscriber growth, continues to reduce its dependency on debt, faces no unfair competition, and maintains its liquidity, it can surpass major telcos in Africa and become the blue-eyed boy for Bharti Airtel. 

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Market News Top 10 News

Tata Consumer’s Net Profit Rises 31% YoY – Top Indian Market News

Tata Consumer Q2 Results: Net Profit rises 31% YoY to Rs 273 crore

Tata Consumer Products Ltd reported a 31.4% year-on-year (YoY) increase in net profit to Rs 273.18 crore, for the quarter ended September (Q2). The company’s revenue increased by 18.5% YoY to Rs 2,781.34 crore, during the same period. The FMCG firm has stated that its sales have rebounded to pre-Covid levels.

Voltas Q2 Results: Net Profit falls 26% YoY to Rs 80 crore

Voltas Limited reported a 25.75% year-on-year (YoY) decline in consolidated net profit to Rs 79.66 crore, for the quarter ended September (Q2). The total income of the company increased by 10.45% YoY to Rs 1,650.80 crore, during the same period. Voltas has stated that it has continued to be the market leader in the room air conditioner space, with a market share of 26.8%.

Read more here.

Supreme Court orders Airtel, Vodafone to provide details of special offers to TRAI

The Supreme Court has backed the Telecom Regulatory Authority of India’s (TRAI) request to seek details from Bharti Airtel Ltd and Vodafone Idea Ltd. The telecom companies will have to disclose all details regarding their segmented tariff or special offers for certain customers. As per the ruling, the disclosed information has to be kept confidential by TRAI.

Read more here.

Bank of India Q2 Results: Net Profit up by 98% YoY to Rs 526 crore

Bank of India Ltd reported a 98% year-on-year (YoY) increase in standalone net profit at Rs 526 crore, for the quarter ended September (Q2). The bank’s net interest income (NII) increased by 6.55% YoY to Rs 4,113 crore, during the same period. The share price of the bank saw a rise of 2.89%, and closed at Rs 41 on the NSE today.

Read more here

APL Apollo Tubes signs pact with Zamil Steel Buildings India

APL Apollo Tubes Ltd. has signed a pact with Zamil Steel Buildings India to develop a market for pre-engineered steel buildings made from structural steel tubes. Zamil Steel India is a subsidiary of Saudi Arabia-based Zamil Industrial Investment Company. Apollo Tubes has stated that this agreement is in line with its broader strategy to create demand for structural steel tubes in India.

Read more here.

Manappuram Finance Q2 Results: Net Profit declines 6.4% YoY to Rs 405 crore

Manappuram Finance Ltd. reported a 6.4% year-on-year (YoY) decline in net profit to Rs 405.44 crore, for the quarter ended September (Q2). The total income of the company increased to Rs 1,577.91 crore, during the same period. The company has also declared an interim dividend of 60 paise per share of the face value of Rs 2.

Read more here.

Coal India to consider interim dividend on November 11

Coal India Limited (CIL) has stated that it will conduct a board meeting on 11th November to consider quarterly earnings, and also consider payment of interim dividend. The company has fixed 20th November as the record date for the purpose of payment of dividend, if it is declared. Earlier, the company had also announced that its e-auction sales had nearly tripled in October to 16.8 million tonnes.

Read more here.

Cipla Q2 Results: Net Profit jumps 41% YoY to Rs 665 crore

Cipla Limited reported a 41.8% year-on-year (YoY) increase in consolidated net profit to Rs 665.43 crore, for the quarter ended September (Q2). The drug maker’s total revenue from operations increased by 14.62% YoY to Rs 5,038.29 crore, during the same period. The Mumbai-based company has stated that its business in India grew by 17% YoY in Q2.

Read more here.

Vedanta Q2 Results: Net Profit falls 62% YoY to Rs 824 crore

Vedanta Limited reported a 61.8% year-on-year (YoY) decline in consolidated net profit at Rs 824 crore, for the quarter ended September (Q2). The revenue of the company declined by 4% YoY to Rs 20,804 crore, during the same period. Last month, Vedanta had failed to delist its shares from the stock markets.

Read more here.

MRF Q2 Results: Net Profit jumps 79% YoY to Rs 411 crore

MRF Limited reported a 79% year-on-year (YoY) increase in consolidated profit to Rs 410.92 crore, for the quarter ended September (Q2). The consolidated revenue from operations stood at Rs 4,244.43 crore, during the same period. The tyre major has stated that its top-line sales have grown above pre-Covid levels.

Read more here.

Dr. Lal PathLabs Q2 Results: Net Profit rises 7.5% YoY to Rs 87 crore

Dr. Lal PathLabs Limited reported a 7.5% year-on-year (YoY) increase in net profit to Rs 87.1 crore, for the quarter ended September (Q2). The company’s revenue from operations increased by 18% YoY to Rs 431.9 crore, during the same period. The diagnostic services provider has announced an interim dividend of Rs 6 per share.

Read more here.

IOL Chemicals Q2 Results: Net Profit rises 45% YoY to Rs 126 crore

IOL Chemicals & Pharmaceuticals Ltd reported a 45% year-on-year (YoY) increase in standalone net profit to Rs 126.96 crore, for the quarter ended September (Q2). The company’s sales increased by 18.83% YoY to Rs 533.48 crore, during the same period. IOL Chemicals has announced an interim dividend of Rs 4 per share. 

Read more here.

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Market News

SC reserves order on the timeline for AGR dues to be paid.

SC AGR

The Supreme Court today once again reserved its order on the much-talked-of AGR (Adjusted Gross Revenue) case. The timeline for the payment of AGR dues is still debatable.

The Sum and Substance of Today’s Hearing

  •  A three-judge bench of Justices Arun Mishra, S Abdul Nazeer and MR Shah heard the case. The court reserved their order to decide the timeline withing which the telecom operators were to pay their dues.
  • The SC stated that the calculation of AGR dues by the Department Of Telecommunications should be treated as final as that there is no room for self-assessment or renegotiation by any of the respondents.
  • Vodafone-Idea represented by counsel Mukul Rohatgi expressed poor liquidity, disposable assets and lack of sufficient funds on part of Vodafone-Idea to be able to pay the dues. Moreover, he requested for a period of 20 years and at best 15 years for Vodafone-Idea to pay its AGR dues.
  • Bharti Airtel represented by counsel Abhishek Manu Singhvi stated that the Government had wrongly charged Bharti Airtel for Spectrum Usage Charges (SUC) which should not be a part of AGR dues. He requested for a period of 10 or 20 Years since upfront payments could affect the 11,000 employees of the company and services provided by the company itself.
  • Senior Advocate Mohan Parasaran on behalf TATA Telecommunications stated that the company submits to SC that a 7-10 year period would be reasonable for repaying AGR dues.

As per DoT estimates, telecom companies owe a total of Rs 1.19 lakh crore with payments received so far at Rs 26,896 crore. The balance amount to be paid is currently at Rs 92,520 crore.

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Editorial

The entire Telecom AGR saga

agr

What is AGR- Adjusted Gross Revenue?

Whenever a company makes money, they are liable to pay tax to the government. Telecom companies charge Interconnect Usage Charge (IUC) but it is not a part of the income which stays with them. They have to pass it to different operators. Thus, this charge only inflates their total revenue. It won’t be fair if the government taxes a telecom company on this inflated number. Hence, the total gross revenue is adjusted downwards which is known as Adjusted Gross Revenue.

Where it All Began

After 1994, telecom companies were allowed to operate in a fixed license system which was very expensive. From 1999, the government allowed the telcos to migrate from the expensive license-based model to the revenue-sharing model. This model helped the company to share a part of what they earned rather than paying out a high fixed amount. The payment under the new model was divided into two parts annual license fee (LF) and spectrum usage charges (SUC). The former would be 8% of AGR and the latter would be 3%-5% of AGR.


This AGR was the base of the argument which started in 2005 when the Cellular Operators Association of India (COAI) challenged the definition of AGR calculation that was followed by the government. This leads us to dive deep into the definition given by both the parties and the dispute which continued for a decade and a half.

The “AGR Definition” Dispute

The telecom companies believe that the government should be charging tax from the revenue generated only from the core business and not from other businesses. For example, a telecom company like Airtel will generate revenue not only by providing services in the telecom area but also by selling off its assets or by investing in equities or bonds.

Now, the DoT says that AGR includes the revenue generated by the company as a whole and not only from its core business. They believe that companies are earning revenue only because they are allowed to do business in the country. Hence, they are liable to pay taxes on their total AGR, no matter if it is coming from the company’s core business or the non-core business. 

We bring you a timeline of things that have shaped this whole saga –

October 24, 2019

The judgment day. After 14 years of indecision and uncertainty, the Supreme Court of India announced their mammoth verdict. The SC decided to widen the definition of AGR and include revenues coming for non-core items for taxation. The bombshell was that the apex court has asked the companies to pay all their dues amassing Rs 1.19 lakh crore by 23rd January 2020.

January 23, 2020

Vodafone Idea, Bharti Airtel and others miss the deadline citing poor financial health of their companies. The government also asked DoT not to take any action against the defaulting on payments.

February 14, 2020

As expected, the red-hot SC blasted the Centre, DoT and the telecom companies for not respecting their orders. The apex court declared March 17 as the new deadline for the companies to clear all their AGR dues. 

March 18, 2020

In the past few weeks, telecom companies started clearing their dues but only partially. Supreme Court was asked to give 20 years for companies to clear their AGR dues. The apex court fiercely rejected the idea and also declared that companies won’t be allowed to self-assess their dues. 

June 18, 2020

Supreme Court cooled its stance a tad bit. They asked the companies to present a detailed plan of action as to how they intend to clear their dues. This plan of action should consist of the years that the companies would be asking for and the guarantees they will be giving in the meantime. No allowance for staggered payment would be issued if companies fail to provide adequate bank guarantees and a proper roadmap for payment in upcoming years. 

July 20, 2020

The Supreme Court reserved its orders for the AGR payment timeline. They reiterated that the calculation done by DoT is final and binding. Vodafone accepted the dues levied on them but requested 15 years to pay back the dues. Their counsel stated that the company is in “deep waters”. They even asked the government to retain the Rs 8,000 crore worth of GST refunds for this year.

With all this, the Supreme Court voiced their concern on how they can “rely” on a company to pay their dues in future if they already are in shambles. The next hearing is scheduled on 10th August 2020.

AGR Dues for Vodafone Idea: 

Dues Outstanding: Rs 58,254 crore

Dues Paid: Rs 7,854 crores 

Balance Due: 50,400 crore

Vodafone’s counsel told the Supreme Court that the company is “barely afloat”. If the apex body forces the company for an upfront payment, they will be forced to shut down their operations in India which will directly impact over 1100 employees.

AGR Dues for Bharti Airtel:

Dues Outstanding: Rs 43,980 crore

Dues Paid: Rs 18,004 crore 

Balance Due: Rs 25,976 crore

Airtel has paid 60% of the total dues paid by the telecom companies till now. Several analysts believe that Airtel is in a much better financial condition when compared to Vodafone and will be able to pay its dues soon. Doubts remain on the survival of Vodafone Idea.

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Market News

Telecom AGR hearing on 20th July – Vodafone Idea in Focus

Vodafone Idea

The AGR saga continues and its next hearing will be on 30th July. This story of Adjusted Gross Revenue from telecom sector has been continuing for the past 16 years.

Supreme Court’s order of October 2019, widened the definition of AGR to include non-core items. Companies like Airtel, Vodafone and others missed the apex court’s deadline of 23rd January to make payments.

After SC’s decision, the Department of Telecommunication estimated that Vodafone Idea owes Rs 58,254 crore and Bharti Airtel owes Rs 43,980 crore. Out of this amount, Vodafone Idea and Bharti Airtel have paid Rs 6,354 crore and Rs 18,004 crore respectively.

Both the telecom companies have stated that, currently, they are not in a position to pay statutory dues anymore. Therefore, they have asked for a period of 20 years and offered to pay in a staggered form during that timeline. Supreme Court didn’t accept this plan but have asked the telecoms to present a detailed roadmap of the payment timeline.

Vodafone Idea has voiced their concerns with the decision. They have already warned that they will be forced to shut their shops in the country if asked to pay their dues without being in instalments.

Telecom experts believe that while Bharti Airtel can manage to clear the dues, Vodafone Idea’s financial position looks uncertain.