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Akasa Air Gets DGCA License to Fly – Top Indian Market Updates

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

Akasa Air gets airline license from DGCA

Ace investor Rakesh Jhunjhunwala’s Akasa Air has received the Air Operator Certificate (AOC) from the Directorate General of Civil Aviation (DGCA). The grant of the AOC marks the satisfactory completion of all regulatory and compliance requirements for the airline’s operational readiness. The airline will start commercial operations later this month. Akasa Air will be the eighth airline to operate domestically.

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BHEL commissions 100-MW floating solar PV plant in Telangana

Bharat Heavy Electricals Ltd (BHEL) has commissioned a 100 megawatts (MW) floating solar photovoltaic (PV) plant at NTPC Ramagundam, Telangana. The plant is installed across a natural raw water reservoir, saving valuable land resources and also conserving water by reducing evaporation. The plant will produce clean power with innovatively engineered layouts and arrangements for the solar PV modules, electricals, and floaters.

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JSW Steel’s consolidated output rises 16% to 5.88 MT in Q1

JSW Steel Ltd’s combined crude steel production for Q1 FY23 stood at 5.88 million tonnes (MT), registering a growth of 16% YoY. On a quarter-on-quarter (QoQ) basis, crude steel production was 2% down from 5.98 MT in January-March 2022 (Q4 FY22). The decline is due to the preponement of certain scheduled shutdowns during the financial year 2022-23.

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Glenmark Pharma launches Sitagliptin in India

Glenmark Pharmaceuticals Ltd has launched Sitagliptin and its fixed-dose combinations (FDCs) for adults with Type-2 diabetes in India. The pharma company has introduced 8 different combinations of Sitagliptin-based drugs under the brand name SITAZIT and its variants. It will help diabetes patients to manage their glycemic levels effectively.

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Ajmera Realty Q1 sales bookings jump over 3-fold to Rs 400 crore

Ajmera Realty & Infra India Ltd reported a 261% YoY jump in sales to Rs 400 crore for the quarter ended June (Q1 FY23). The company sold 1.57 lakh sq. ft. carpet area, registering a growth of 155% YoY. Collections increased by 126% YoY to Rs 210 crore in Q1. Despite the high input cost scenario and projected high-interest environment, Ajmera Realty is observing a positive momentum from home buyers.

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Kalyan Jewellers’ revenue jumps 105% YoY in Q1

Kalyan Jewellers India Ltd’s (KJIL) consolidated revenue grew 105% YoY during the quarter ended June (Q1 FY23). The company witnessed more than a 115% YoY growth in revenue from its India operations and 65% YoY from Middle Eastern operations. KJIL saw an improvement in gross margin in Q1, driven by an increase in the studded jewellery mix and share of business from non-south markets.

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Cyient partners with IIT Hyderabad to nurture India’s entrepreneurial talent

The Cyient Foundation and the Shibodhi Foundation have partnered with IIT Hyderabad to develop the BVR Mohan Reddy School of Innovation and Entrepreneurship (BVR SCIENT) on its campus. BVR SCIENT aims to nurture and develop world-class innovation and entrepreneurial talent from India. Cyient Foundation is the Corporate Social Responsibility (CSR) arm of Cyient Ltd.

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RBI eases overseas borrowing to boost forex inflows

The Reserve Bank of India (RBI) has announced several temporary measures aimed at boosting foreign exchange (forex) inflows. The steps include doubling borrowing limits for companies from overseas to $1.5 billion during a financial year. Interest rate ceilings for foreign currency deposits by non-resident Indians’ (NRI) will be removed. The move comes at a time when persistent capital outflows and a widening trade deficit have led to a sharp depreciation in the value of the Indian Rupee to new record lows against the U.S. Dollar.

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G M Breweries Q1 Results: Net profit rises 39% YoY to Rs 16.16 crore

G M Breweries Ltd reported a 38.8% year-on-year (YoY) increase in net profit to Rs 16.16 crore for the quarter ended June (Q1 FY23). Its revenue from operations jumped 103.8% YoY to Rs 142.02 crore during the same period. Total expenses rose 106% YoY to Rs 531.18 crore in Q1. G M Breweries manufactures and markets alcoholic beverages such as country liquor (CL) and Indian-made foreign liquor (IMFL).

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Power Grid, Tata Projects executives arrested in bribery case

The Central Bureau of Investigation (CBI) has arrested Executive Director of Power Grid Corporation of India B S Jha and five officials of Tata Projects in connection with alleged bribery to favor the private company. The agency had conducted searches in Ghaziabad, Noida, and Gurugram, during which Rs 93 lakh cash was recovered from the offices of Jha.

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Market News Top 10 News

Asian Paints to Hike Prices by 4-6% From Dec – Top Indian Market News

Asian Paints to hike prices by 4-6% from December

Asian Paints Ltd has confirmed that it is taking a price hike of about 4-6% starting December 5 to offset the impact of rising input costs. The company had earlier hiked prices by 8-9% with effect from November 12. So far, it has taken a cumulative price hike of about 15-16% this year. Asian Paints said high raw material inflation will push the pace of price hikes.

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Coal India allocates 17.34MT of coal to power sector under special forward e-auction in April-Sept

Coal India Ltd (CIL) allocated a 72.1% higher quantity of coal at 17.34 million tonnes (MT) under the special forward e-auction scheme to the power sector during the April-September period. The company had allocated 10.07 MT of coal under the scheme in the year-ago period. Coal distribution through forward e-auction is aimed at providing access to coal for consumers who wish to have an assured supply over a long period to plan their operations.

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Bharti Airtel partners with open network provider Mavenir for 5G trials

Bharti Airtel has partnered with US-based Mavenir for open radio access network (O-RAN)-based 5G field trials in the 3,500 MHz and millimeter wave (mmWave) bands at Chandigarh tri-city. The alliance between the two firms includes the deployment of captive 5G standalone and non-standalone modes for both core and radio networks in Chandigarh’s urban and rural areas. It would further allow Bharti Airtel to test a vendor-neutral ecosystem.

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Zebra Technologies selects TCS to drive digital transformation

Tata Consultancy Services (TCS) has entered into a strategic transformation engagement with US-based Zebra Technologies Corp to drive its IT agile transformation. Zebra provides a portfolio of purpose-built hardware, software, services, and solutions that digitize and automate workflows for the retail, manufacturing, and logistics sectors. TCS will play a key role in the end-to-end global agile transformation of Zebra’s IT that supports its systems and applications used by 8,800 employees in 45 countries.

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Meghmani Organics to invest Rs 400 crore for white pigment plant at Dahej

Meghmani Organics Ltd will set up a manufacturing facility for White Pigment Titanium Dioxide (TiO2) in Dahej, Gujarat. The total capital expenditure (capex) allocated for the project is Rs 400 crore. The plant will have a capacity of 33,000 tonnes per annum. TiO2 has application as a bright white pigment in various industries including paint, coating, plastic, ink, dyes, paper, and cosmetics.

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Coromandel to set up sulphuric acid plant in Vizag for Rs 400 crore

Coromandel International Ltd has announced plans to set up a 1,650 metric tonnes per day (MTPA) sulphuric acid plant at its fertiliser complex in Visakhapatnam. The company will invest Rs 400 crore for this project. The plant will add another 500,000 tonnes a year of sulphuric acid production capacity to the existing 600,000 tonnes. 

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Rakesh Jhunjhunwala’s Akasa Air orders 72 Boeing 737 Max jets

Rakesh Jhunjhunwala-backed Akasa Air has signed a deal with Boeing for 72 fuel-efficient 737 MAX airplanes. The order is valued at nearly $9 billion (~Rs 67,000 crore) at list prices. The low-cost carrier plans to offer commercial flights starting in the summer of 2022 and use its new fleet of 737s to meet the growing demand across India. In October, the Ministry of Civil Aviation had given a no-objection certificate (NOC) for the operation of Akasa Air in India.

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Ashok Leyland’s EV arm to supply 300 e-buses to BMTC

Ashok Leyland’s electric vehicle (EV) arm, Switch Mobility, has received an order to supply and operate 300 electric buses for Bengaluru Metropolitan Transport Corporation (BMTC). The fleet and charging infrastructure will be supplied, operated, and maintained by Switch Mobility for a period of 12-years. The electric buses of Ashok Leyland are expected to reduce fuel consumption by around 5.5 million litres annually. 

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HCL Tech secures multi-year deal from Euroclear Group

HCL Technologies (HCL) has announced a new multi-year application deal with Belgium-based Euroclear Group to accelerate its agile transformation journey. Euroclear is the world’s largest provider of domestic and cross-border settlement and related services for bond, equity, and fund transactions. HCL Tech will work with Euroclear to explore new business models and market opportunities to create value through innovation and data monetisation.

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Tarsons Products IPO subscribed 3.58 times on second day

The Rs 1,023.47 crore IPO of Tarsons Products Ltd was subscribed 3.58 times on the second day of bidding. Retail investors have subscribed 4.74 times against their reserved portion. Non Institutional investors (NIIs) and Qualified Institutional Buyers (QIBs) have subscribed 3.98 times and 1.30 times, respectively, against their reserved portions. 

To learn more about the IPO, click here.

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Market News Top 10 News

JSW Steel’s Crude Steel Production Rises 29% YoY in Q2 – Top Indian Market News

JSW Steel reports 29% YoY rise in crude steel production in Q2

JSW Steel Ltd reported a 29% YoY increase in crude steel production at 5.07 million tonnes (MT) for the quarter ended Sept (Q2 FY22). The capacity utilisation at the standalone level was at 91% during the quarter. For the six months ending September 30, 2021, the company recorded crude steel production growth of 21% on a standalone basis and 45% at the steel group level.

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Rakesh Jhunjhuwala-backed Akasa Air to start operations by 2022

Akasa, the new airline backed by ace investor Rakesh Jhunjhunwala, has received a No Objection Certificate (NOC) from the Ministry of Civil Aviation. SNV Aviation Pvt Ltd will fly under the brand name “Akasa Air” with Vinay Dube as CEO. The airline will now seek a license from the Directorate General of Civil Aviation (DGCA) to commence operations in the summer of 2022. Akasa Air aims to be India’s most dependable, affordable, and greenest airline.

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Power Mech Projects secures orders worth Rs 448.6 crore

Power Mech Projects Ltd has received a Letter of Intent (LoI) for orders worth Rs 448.60 crore. The project includes the operation and maintenance of 2×660 megawatt (MW) Mutiara Thermal Power Plant in Melamaruthur Village, Tuticorin. The company has also received a miscellaneous civil works order for Screening Plant-III in Kirandul, Chattisgarh, from NMDC Ltd.

Prestige Estate Projects registeres highest quarterly sales in Q2

Prestige Estates Projects registered its highest-ever quarterly sales of Rs 2,111.90 crore and collections of Rs 1,551.50 crore during Q2 FY22. The company’s sales rose 88% YoY and collections jumped 35% YoY during the same period. In terms of volume, the real estate developer sold 3.54 million square feet area in Q2, compared to 1.77 million sq. ft. area in the corresponding period last year.

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Macrotech Developers signs 5 JVs in H1 to build projects worth Rs 4,500 crore

Macrotech Developers has formed five joint ventures (JVs) since April 2021 to develop projects that have a sales potential of Rs 4,500 crore. The company is aiming to enter into five more such tie-ups with landowners by the end of the current financial year (FY22). The development potential in five joint development agreements (JDAs) is around 4 million square feet in various micro-markets of Mumbai Metropolitan Region (MMR) and Pune. Mumbai-based Macrotech Developers markets its properties under the ‘Lodha’ brand.

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Saregama India Q2 Results: Net profit rises 19.9% YoY to Rs 33.8 crore

Saregama India Ltd reported a 19.9% year-on-year (YoY) increase in consolidated net profit to Rs 33.8 crore for the quarter ended Sept (Q2 FY22). Net profit increased by 24.31% when compared to the previous quarter. Its total revenue from operations rose 34.21% YoY to Rs 145.09 crore during the same period. The revenue from Saregama India’s music business rose 21% YoY to Rs 121.58 crore in Q2. Revenue from the TV & film division surged 238% YoY to Rs 22.35 crore.

Tata Motors reports 24% rise in group global wholesales in Q2

Tata Motors Ltd reported a 24% YoY increase in group global wholesales (including Jaguar Land Rover) to 2,51,689 units in Q2 FY22. Global wholesales of all Tata Motors’ commercial vehicles and Tata Daewoo range during the quarter stood at 89,055 units, up 57% YoY. The global wholesales of all passenger vehicles in Q2 rose 11% YoY to 1,62,634 units. JLR’s global sales stood at 78,251 units during the same period.  

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Glenmark Pharma launches Tavulus for COPD treatment in Spain

Glenmark Pharmaceuticals has launched the Tiotropium Bromide dry powder inhaler (DPI) under the brand name Tavulus in Spain. The drug is used for the treatment of chronic obstructive pulmonary disease (COPD). COPD is a long-term condition that causes inflammation in the lungs, damaging the lung tissue and narrowing the airways, all of which make breathing difficult. Tavulus helps to open the airways and makes it easier for air to get in and out of the lungs. 

Read more here.

Ramkrishna Forgings Q2 Results: Net profit rises 78.45% QoQ to Rs 44.05 crore

Ramkrishna Forgings Ltd reported a 1,934.97% YoY jump in consolidated net profit to Rs 44.05 crore for the quarter ended Sept (Q2 FY22). Net profit rose 78.45% when compared to the previous quarter. Its revenue from operations rose 129.67% YoY to Rs 578.82 crore during the same period. Total income and net profit have surged 172.39% YoY and 345.30% YoY, respectively, for the half-year ended Sept 2021. The company has declared an interim dividend of Rs 0.5 per share.

Alembic Pharma gets EIR from USFDA for Karakhadi facility

Alembic Pharmaceuticals Ltd has received an Establishment Inspection Report (EIR) from the US Food & Drug Administration (USFDA) for its new injectable facility at Karakhadi, Gujarat. The USFDA has indicated that a compliance verification would be performed during the re-inspection of the facility in the next review cycle. Vadodara-based Alembic Pharma is a leading provider of active pharmaceutical ingredients (APIs) and generic formulations.

Read more here.

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Editorial

Can Rakesh Jhunjhunwala’s ‘Akasa’ Fly to New Heights?

You must have heard it by now. Ace investor Rakesh Jhunjhunwala has announced plans to launch his own airline, “Akasa”, with 70 aircraft over the next four years. He will invest $35 million (~Rs 260 crore) and hold a 40% stake in the company. Interestingly, Vinay Dube, the former CEO of Jet Airways and GoAir, will be leading the new venture. Reports also state that former IndiGo boss Aditya Ghosh has joined the Akasa team. They have sought a No Objection Certificate (NOC) from the Ministry of Civil Aviation to commence operations. 

At a time when the entire airline industry is struggling to cope amidst the Covid-19 pandemic, is it wise to launch a new airline? Let’s find out.

The Present State of India’s Aviation Industry

According to a report from consultancy firm CAPA, airlines in India are expected to incur losses of over $4 billion (~Rs 29,750 crore) for the second year in a row. Air traffic has declined considerably due to Covid-related restrictions across our country. Data published by the Directorate General of Civil Aviation (DGCA) revealed that the number of air passengers fell from ~233 lakh in the quarter ended March (Q4 FY21) to 109 lakh in Q1 FY22. Major airlines such as IndiGo, SpiceJet, and Go First (previously known as GoAir) are currently operating at 65% of their pre-pandemic seat capacity. 

Revenues have taken a severe hit due to restrictions on the movement of people. IndiGo reported its highest-ever quarterly loss of Rs 3,174 crore in the April-June quarter (Q1). Moreover, the companies mentioned above are burdened with high costs and debt. Airlines are incurring extra costs to set up health and safety systems for passengers. At the same time, the cost of aviation turbine fuel is surging. The ongoing effects of the pandemic will continue to cause trouble to the airline industry. Existing airlines are a long way away from recovery. The government is not providing any direct support as well.

Now, on the onset of a third wave, the Big Bull Rakesh Jhunjunwala is betting on the future prospects of the aviation sector. 

The Right Time to Launch a New Airline?

  • Currently, all prominent companies in India’s airline space are financially weak. Some are likely to go bankrupt if the Covid-19 situation prevails. Many analysts feel that this is a perfect time to launch a new airline in India. And that too, a well-funded ultra-low-cost carrier (ULCC). Other airlines will have no option but to reduce their prices to compete with a ULCC, which will cause further strain on their financial performance.
  • Most airline companies across the world lease aircraft rather than outrightly purchasing them. They borrow the large Boeings and Airbus planes from leasing companies and make payments in installments. With the onset of the Covid-19 pandemic, these leasing firms had a large fleet of aircraft at their disposal that was simply left idle or unused. As a result, they started offering huge discounts on lease rates to new customers. Akasa could greatly benefit from this.
  • A lot of pilots and cabin crew members across all airlines in India lost their jobs amidst the pandemic. They are desperately looking for new work and are willing to take salary cuts. Thus, Akasa’s initial expenses would be minimal. 

Conclusion

Akasa will be an ultra-low-cost carrier, which means that Rakesh Jhunjhunwala and his team plans to capture a significant portion of the Indian market. The airline is expected to bring down average fares and make flying affordable to a larger population base. However, the success of a new airline will ultimately depend on the kind of airport slots they get access to. Moreover, IndiGo (a low-cost carrier) has over 54% market share. Jet Airways is all set to make a comeback as well. Akasa will have to compete heavily with the well-established networks of these existing airlines. 

In his interview with Bloomberg TV, Jhunjhunwala said: “I’m very bullish on the Indian aviation sector in terms of demand and I think some of the increment players will not recover”.

Many believe that Rakesh Jhunjhunwala’s deep pockets and business acumen will play a vital role in Akasa’s launch and success. If they deliver on promises and manage to keep expenses low, Akasa will be able to perform well. If the prices are attractive enough, Indian customers would simply move to the new airline. We will have to patiently wait and watch how they execute all strategic plans in the near future.

Will Akasa be able to take off smoothly and disrupt the aviation industry? Let us know your views on this new airline venture in the comments sections of the marketfeed app.