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IndiGo Posts Rs 3,091Cr Profit in Q1 – Top Indian Market Updates

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

IndiGo Q1 Results: Net profit at ₹3,091 crore

InterGlobe Aviation (IndiGo) reported a consolidated net profit of ₹3,091 crore for the quarter ended June (Q1 FY24); beating street estimates. This is the highest-ever quarterly net profit reported by the budget carrier. The airline posted a loss of ₹1,064 crore in Q1 FY23. Its revenue from operations rose 30% YoY to ₹16,683 crore during the same period. IndiGo’s passenger ticket revenues were at Rs 14,996 crore, up 31% YoY.

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Carlyle to acquire 5.91% stake in SpiceJet at Rs 48 per share

SpiceJet Ltd has sought shareholder approval to issue a 5.91% stake in the low-cost airline to Carlyle Aviation Partners (CAP). CAP is the aircraft financing unit of global private equity giant Carlyle Group. The company will also issue equity shares of 20% to promoter Ajay Singh (the airline’s CEO) at ₹10 per share.

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Titan Q1 Results: Net profit falls 2% YoY to ₹777 crore

Titan reported a 2% YoY decline in net profit of ₹777 crore for the quarter ended June (Q1 FY24). Its revenue from operations rose 19% YoY to ₹10,306 crore during the same period. The company’s jewellery segment posted revenue of ₹9,070 corre in Q1, up 19% YoY. Titan’s watches and wearables business recorded a total income of ₹890 crore, up 13% YoY.

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Tata Power RE signs PPAs with MSEDCL for solar projects

Tata Power Renewable Energy Limited (TPREL) has signed two power purchase agreements (PPAs) with Maharashtra State Electricity Distribution Company Ltd. (MSEDCL) for commissioning two solar power projects. Located in Maharashtra, these projects of 200 MW and 150 MW will play a crucial role in fulfilling the state’s renewable energy target.

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Gujarat Gas Q1 Results: Net profit falls 43% YoY to ₹216 crore

Gujarat Gas reported a 43% YoY fall in consolidated net profit to ₹216 crore for the quarter ended June (Q1 FY24). Its revenue from operations fell 26% YoY to ₹3,923.7 crore during the same period. EBITDA fell 36% YoY to ₹388 crore in Q1. Its total gas sales volume for the quarter stood at 9.22 million metric standard cubic meters per day (mmscmd), compared to 8.86 mmscmd in Q1 FY23.

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Ambuja-ACC is frontrunner to acquire Sanghi Cements

Adani Group’s Ambuja-ACC has emerged as the frontrunner to acquire Sanghi Cements after deal negotiations moved forward over the past week. The group has come close to the expected enterprise value of ₹6000 crore that Sanghi Cement’s promoters have demanded as consideration for the sale of the company.

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Sula Vineyards receives excise duty notice of ₹116 crore from Maharashtra govt

Sula Vineyards Ltd (SVL) has received an excise duty notice of ₹116 crore from the Maharashtra excise department. This comes after the minister (State Excise Revenue) vacated the interim stay granted on the demand notice issued by the Nashik collector for recovery of excise duty from SVL. Sula Vineyards has been recognised as the market leader across wine variants, including red, white, and sparkling wines.

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Ambuja Cements Q1 Results: Net profit rises 31% YoY to ₹1,135 crore

Ambuja Cements reported a 31% YoY rise in consolidated net profit to ₹1,135 crore for the quarter ended June (Q1 FY24). Its revenue from operations rose 9% YoY to ₹8,713 crore during the same period. The company’s EBITDA stood at ₹948.8 crore in Q1, up 38% YoY. Its total sales volume rose 23% YoY to ₹9.1 million tonnes (MT).

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Brookfield India REIT raises ₹2,305 crore via sale of units

Brookfield India Real Estate Trust has raised ₹2,305 crore by selling units to institutional investors on a private placement basis. The firm will mainly use this fund for the acquisition of two assets in Gurugram and Mumbai. The company has approved the allotment of 9.13 crore units to 64 successful eligible institutional investors at the issue price of ₹252.50 per unit.

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CPI Inflation Spikes to 6.52% in Jan – Top Indian Market Updates

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

CPI inflation spikes to three-month high of 6.52% in Jan

India’s Consumer Price Index (CPI) or retail inflation rose to a three-month high at 6.52% in January 2023. The retail inflation rate had eased down to 5.72% in December. Food inflation surged from 4.19% in Dec to 5.94% in Jan. The inflation rate for fuel & light declined marginally from 10.97% to 10.84% in Jan.

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Nykaa Q3 Results: Net profit falls 68% YoY to ₹9 crore

FSN E-Commerce Ventures (Nykaa) reported a 68% YoY decline in consolidated net profit to ₹9 crore for the quarter ended December (Q3 FY23). Its revenue from operations rose 33% YoY to ₹1,462 crore during the same period. The company’s expenses stood at ₹1,455 crore in Q3, up 36% YoY. The gross merchandise value (GMV) grew 37% YoY to ₹2,796 crore.

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Natco Pharma submits application with USFDA for generic cancer drug

Natco Pharma has submitted a new application with the US Food & Drug Administration (USFDA) for marketing authorisation of the generic version of Olaparib tablets. The drug is used to treat certain forms of ovarian, breast, pancreatic, and prostate cancers. Olaparib tablets are marketed in the US by AstraZeneca under the Lynparza brand.

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Godrej Industries Q3 Results: Net profit jumps 117% YoY to ₹314 crore

Godrej Industries Ltd reported a 117% YoY jump in consolidated net profit to ₹314.58 crore for the quarter ended December (Q3 FY23). Its revenue from operations grew 9.3% YoY to ₹3,514.61 crore during the same period. Total expenses grew 8.12% YoY to ₹3,795.10 crore in Q3. EBITDA rose 53.9% YoY to ₹373.2 crore.

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Vodafone Idea in talks to refinance ₹3,000-4,000 crore of loans

According to an Economic Times report, Vodafone Idea (Vi) has started fresh talks with key lenders, including State Bank of India, Punjab National Bank, and HDFC Bank, to refinance loans worth ₹3,000-4,000 crore. Refinancing some debt will help free up cash for Vi. The telco urgently needs to pay substantial vendor dues to tower companies like Indus Towers and network equipment makers such as Ericsson and Nokia.

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Gujarat Gas Q3 Results: Net profit jumps 204% YoY to ₹371 crore

Gujarat Gas Ltd reported a 204% YoY jump in net profit to ₹371.26 crore for the quarter ended December (Q3 FY23). Its revenue from operations fell 27% YoY to ₹121.93 crore during the same period. Total expenses stood at ₹3,355.87 in Q3, down 34.4% YoY. The company added close to 48,600 new domestic customers and 228 commercial customers in Q3.

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Adani Group cuts revenue growth target, capex

The Adani Group has halved its revenue growth target and aims to scale down fresh capital expenditure. This move comes days after US-based short seller Hindenburg Research published a negative report on the conglomerate. The group will now aim for revenue growth of 15% to 20% for at least the next financial year (FY24), down from the 40% growth originally targeted.

In other news, Adani Group has pledged additional shares in favour of SBICAP Trustee (a subsidiary of SBI) as the group companies are required to maintain 140% collateral security coverage as per one of the conditions relating to an existing loan. 

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Balkrishna Industries Q3 Results: Net profit falls 68% YoY to ₹108 crore

Balkrishna Industries Ltd reported a 68% YoY decline in consolidated net profit to ₹108.38 crore for the quarter ended December (Q3 FY23). The tyre manufacturer’s revenue from operations rose 6% YoY to ₹2,165.57 crore during the same period. EBITDA stood at ₹314.26 crore in Q3, down 44% YoY. The company’s shares fell 11% today.

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BPCL to Set Up 1,000 EV Charging Stations – Top Indian Market News

BPCL to set up 1,000 EV charging stations

Bharat Petroleum Corporation Ltd (BPCL) plans to add 1,000 electric vehicles (EV) charging stations in the short term. The company aims to tap new business opportunities as a hedge against the displacement of auto fuels. BPCL will offer multiple fuelling options at 7,000 petrol pumps to facilitate owners of vehicles powered by gas, electricity, and hydrogen. It also plans to spend Rs 5,000 crore to build its renewable power portfolio of 1,000 megawatts (MW) over the next five years.

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TCS secures 5-year contract from German bank NORD/LB

Tata Consultancy Services Ltd (TCS) has secured a five-year IT transformation contract from NORD/LB, a leading German commercial bank. TCS will work with the bank to simplify and transform its application estate across multiple businesses through application consolidation and automation. The IT major will also build new features and functionality to support NORD/LB´s transformation goals. 

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BHEL secures order from Goa Shipyard for warship gun mount

Bharat Heavy Electricals Limited (BHEL) has secured an order from Goa Shipyard for a warship gun mount. The order includes the supply of an upgraded Super Rapid Gun Mount (SRGM), which is the main gun onboard most warships of the Indian Navy. The upgraded SRGM is a state-of-the-art weapon system that comprises features such as the capability to manage different types of ammunition to engage fast, radio-controlled targets. 

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Sun Pharma launches cough syrup Chericof 12 in India

Sun Pharmaceutical Industries announced the launch of a novel formulation in cough management— Chericof 12 in India. It is the first prescription cough syrup in India that gives relief for up to 12 hours. Chericof 12 is manufactured using polistirex technology for sustained release of the drug. The technology helps in improving patient compliance and avoids the need for frequent dosing.

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RVNL secures order worth Rs 382 crore for Indore Metro Rail Project

Rail Vikas Nigam Ltd (RVNL) has secured a contract from the Madhya Pradesh Metro Rail Corporation worth Rs 381.95 crore. The contract is for the design and construction of seven elevated metro rail stations of the Indore Metro Rail Project. RVNL will construct the viaduct portion within the stations and transition spans on either side of the stations, entry-exit structures, etc.

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SEBI board approves framework for gold exchange

The Securities Exchange Board of India (SEBI) has approved the framework for gold exchange. The instrument representing gold will be called Electronic Gold Receipts (EGRs) and will have trading, clearing, and settlement features similar to other securities. The proposed gold exchange would lead to efficient and transparent domestic spot price discovery, assurance in the quality of gold, and augment gold recycling in India.

SEBI has also approved the creation of a Social Stock Exchange (SSE), which will help social entrepreneurs raise funds.

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SC rejects Adani Gas’ plea seeking authorisation for city gas distribution network in Ahmedabad district

The Supreme Court (SC) has rejected Adani Gas Ltd’s plea challenging the bidding process for the supply of PNG and CNG in Sanand, Bavla, and Dholka of Ahmedabad district. The SC also upheld the authorisation provided by Petroleum and Natural Gas Regulatory Board (PNGRB) to Gujarat Gas Ltd for establishing and operating the city gas distribution network in the areas adjacent to Ahmedabad. Further, the court imposed Rs 10 lakh cost on Adani Gas.

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IndiGo signs code-sharing agreement with American Airlines

InterGlobe Aviation (IndiGo), India’s largest airline, has signed a code-sharing agreement with American Airlines. The US airline is gearing up to launch new flights between the two countries. Code-sharing allows an airline to sell seats on a flight operated by its partner, such that it can fly passengers to destinations it does not serve. The agreement, expected to start in October, will see American Airlines’ code on 29 of IndiGo’s domestic routes in India.

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Bal Pharma to strengthen its position in diabetes segment via Gliclazide API

Bal Pharma Ltd is further strengthening its market-leading position in the diabetes segment via Gliclazide (API) with higher capacity utilization at the existing facility. The company will also streamline the new facility that commenced production of Gliclazide in September 2020. The pharma company is one of the largest producers and exporters of Gliclazide active pharmaceutical ingredient (API), used to treat Type-2 diabetes. Bal Pharma is a fully integrated pharmaceutical company specialized in Prescription Drugs, Generics, pharma intermediates, and Bulk Actives.

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Anupam Rasayan signs contract worth Rs 145 crore with European customers to supply active ingredient

Anupam Rasayan India has signed a Letter of Intent (LoI) worth Rs 145 crore with existing long-term European multinational customers for supplying a new life science-related active ingredient. The company will enter into a long-term contract for the next three years to supply the specialty chemical product. Anupam Rasayan manufactures products for over 66 domestic and international customers, including 24 multinational companies.

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Editorial

Government’s Boost for Natural Gas in India

India is currently the third-largest energy consumer in the world. Our country is highly dependent on oil and natural gas for its further development and growth. Around 58% of the total energy consumed in India comes from coal, while petroleum and other liquids make up 26% of the energy basket. Unfortunately, the share of natural gas is just 6%, while that of renewables is less than 2%. To ensure sustainable growth, it is high time that our country shifts its focus to greener energy sources. 

Recently, PM Modi announced huge plans to boost the supply of natural gas in India. Over the next decade, we would be able to witness significant changes in our consumption of this clean fossil fuel. Let us understand how the government proposes to achieve its targets. Let us also take a look at a few listed firms that could benefit from these expansion plans.

PM Modi’s Announcement

On January 5, 2021, Prime Minister Narendra Modi announced that the share of natural gas in India’s energy basket will be more than doubled. He stated that energy sources will be diversified, and the nation will be connected with one major gas pipeline grid. Work is in progress to set up 16,000 kilometres of a new gas pipeline, which will be completed over the next 5-6 years. This would help in providing affordable fuel to millions of people, as well as vital industries. The new line would provide the foundation for 700 compressed natural gas (CNG) stations. 

PM Modi stated that the share of natural gas is targeted to be raised to 15% by 2030. The government plans to spend around $60 billion (~Rs 4.4 lakh crore) to create and improve gas infrastructure throughout India. This includes new pipeline projects, liquefied natural gas (LNG) terminals, and city gas distribution (CGD) networks.

On the date of the announcement, the Prime Minister was inaugurating the 450-km long natural gas pipeline between Kochi and Mangaluru. This new line will help take the fuel to industries such as petrochemical plants and fertiliser units. It will also provide fuel for city gas projects for supply of CNG to automobiles and piped cooking gas to households in cities along the route. The pipeline has a design capacity of 12 million standard cubic meters per day. The cost of this project was around Rs 3,000 crore.

Listed Companies in Focus

As mentioned above, the demand for natural gas in India will get a major boost from the government’s plan to establish a large pipeline network. The sale of piped natural gas (PNG) for cooking and compressed natural gas (CNG) for fueling vehicles will grow rapidly in the years to come. India has prominent listed companies that distribute natural gas to end-consumers. Let us take a look at a few of these: 

GAIL (India) Ltd

GAIL (India) Limited is the largest state-owned natural gas processing and distribution company in India. The public sector undertaking (PSU) comes under the administrative control of the Ministry of Petroleum and Natural Gas. The company was incorporated in 1984 and was initially known as the Gas Authority of India Limited. Over the years, they have strategically expanded and diversified into various allied activities. 

Currently, the main business segments of GAIL include natural gas, liquefied petroleum gas (LPG) transmission, petrochemical city gas distribution, exploration & production, and electricity production. The company has constructed some of the largest natural gas pipeline projects and has also developed city gas distribution networks throughout India. It has an existing gas pipeline network of over 12,500 km, which has a capacity of 204 Million Metric Standard Cubic Meter Per Day (MMSCMD). GAIL’s existing natural gas pipeline network covers 18 States.

Indraprastha Gas

Incorporated in 1998, Indraprastha Gas Ltd (IGL) took over Delhi City Gas Distribution Project from GAIL in 1999. The company has established a strong distribution network of natural gas in the National Capital Region (NCR) of Delhi. It distributes the essential clean fossil fuel to consumers in the domestic, transport, and commercial sectors. IGL gave out a record 2.72 lakh new connections for piped cooking gas (PNG) to household kitchens during the financial year 2019-20. It supplies PNG to nearly 14 lakh households. The company also has a network of 557 CNG stations. It sells CNG to over 11.5 lakh vehicles in NCR through this network.

Adani Total Gas

Adani Total Gas Ltd develops city gas distribution (CGD) networks to supply PNG to the industrial, commercial, domestic (residential) sectors. It also distributes CNG to the transport sector. The company has strategically set up CGD networks in Ahmedabad and Vadodara in Gujarat, Faridabad in Haryana, and Khurja in Uttar Pradesh. In November 2020, the company signed a definitive agreement for the acquisition of the business undertaking of city gas distribution and retail sale of CNG in the areas of Jalandhar, Ludhiana, and Kutch (East). 

Adani Gas supplies PNG to approximately 4.4 lakh customers through a connected pipeline network of approximately 7,600 km. The company also has over 115 CNG filling stations. 

Gujarat Gas

Gujarat Gas Ltd also engages in the distribution of city natural gas in India. The company operates a network of approximately 24,400 kilometers of gas pipeline and 403 CNG stations. It supplies natural gas to approximately 14.4 lakh residential consumers and 12,600 commercial customers. It operates in 21 districts of Gujarat, 7 districts of Punjab, and 5 districts of Madhya Pradesh. Gujarat Gas also has a significant presence in Rajasthan, Maharashtra, and Haryana.

Conclusion

Historically, we have seen that these companies often receive contracts from the Centre and state governments to develop natural gas distribution networks. With the announcement of such a large initiative, we could see these companies reporting a higher increase in their revenue growth. The households and industries that are located within the vicinity of the proposed natural gas pipeline projects would be able to obtain the required fuel at cheap rates. Also, we may see the use of natural gas benefiting to reduce pollution levels in the country. Compared to renewable energy sources like solar and wind, natural gas is much cheaper, which may benefit a country like India.

Within 2030, petrol will be doped with as much as 20% of ethanol extracted from sugarcane and other agro products. [Companies such as EID Parry, Uttam Sugar Mills, and Balrampur Chini Mills could benefit from this]. On the other hand, the construction of the world’s biggest hybrid renewable plant (that combines wind and solar power) has started in Gujarat. The manufacturing of biofuels and electric mobility will also be given greater importance. All these projects would help our country to become self-sufficient in meeting energy needs. India will also be able to significantly cut down its carbon emissions. Let us look forward to seeing how India implements this huge task.