Reliance Jio has raised strong objections to the telecom bailout planned by the government; calling it contempt of Supreme Court order. A week after the Supreme Court had ordered telecom majors to shell out Rs.92,000 crore towards AGC charges, Reliance Jio has objected to any concessions. According to a report in The Hindu, Jio had called it a bad precedent. Bharti Airtel and Vodafone Idea had asked for waiver of penalty and interest and a 10-year time period for the AGC charges; which the DOT was willing to concede, especially considering the stress that telecom operators are currently under.
There has been a sharp fall in the mutual fund NFOs in the first 10 months of 2019. According to AMFI data, mutual funds approach SEBI with just 125 new schemes in the year 2019. Fund houses have attributed the sharply lower NFOs in 2019 to the tepid investor sentiment and the liquidity crunch in the market. In 2018, mutual funds had approached SEBI with 211 new offer documents. Normally, the fixed maturity plans (FMPs) are the closed ended funds that are the most frequent to hit the NFO market, but they have been fairly quiet after the recent debt defaults, in the aftermath of the IL&FS fiasco.
State Bank is getting a lot more aggressive about its loan book clean-up as it finalizes plans to auction stressed loans worth Rs.700 crore during the month of November. After a sharp uptick in profits in the September quarter, SBI is planning to auction stressed loans of Rs.700 crore even as the NCLT process has been taking longer than anticipated. SBI has issued a revised policy on sale of financial assets to sell assets directly to ARCs / NBFCs. All auctions are under the Swiss Challenge method where the existing offer will have the right to match the highest bid, and this process is allowed to go on.
The world’s largest oil company and also the most profitable company may be finally set for its maiden IPO in the global markets. Saudi Aramco is expected to issue IPO prospectus for mega issue on November 09th. Saudi Aramco has already kick-started its IPO process and is expected to issue the prospectus on November 09th according to the CEO of Aramco. The Kingdom intends to list Aramco at a valuation of $2 trillion by selling 2% stake at around $40 billion. The final price would be determined after the book building exercise. Market experts expect crude prices to remain buoyant till the IPO.
Even as the Sensex settled above the 40,100 mark and the Nifty got within the vicinity of 12,000, the month of October was marked by sharp inflows from foreign investors. FPIs infused Rs.12,476 crore into equities and Rs.3,989 crore into debt during the month of October. This was nearly 150% more than the overall FPI inflows in September and that also contributed to rupee strength. Value accretion continued to be concentrated with eight out of ten most valuable stocks add Rs.134,000 crore in the week. With 80% of the most valuable companies adding value during the week, it was hardly surprising that the Sensex closed at a new high. While TCS led in terms of market cap accretion during the week, other stocks included Reliance Industries, Hindustan Unilever, HDFC Bank, ITC, HDFC, Infosys and SBI.
The UK elections may have added a fresh twist to the BREXIT progress. Prime Minister Johnson rejected calls for no-deal BREXIT in election pitch. With the House of Commons forcing Johnson to seek an extension for BREXIT by 3 months till January 31st, Johnson has refused to seek votes on the back of a no-deal BREXIT. This has left Nigel Farage of the BREXIT party fairly unhappy. Johnson expressed confidence that UK had a good deal on hand and that he would be able to push through BREXIT after the elections on December 12th. This may impact the BREXIT party support for the Conservatives.
