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Bajaj Finance among top 10 on BSE

Newsmantra — Mon, 17 Feb 2020 05:52:12 +0000

Bajaj Finance Ltd on Monday replaced State Bank of India to become India’s tenth most-valued firm by market capitalisation on the BSE.

According to the BSE, Bajaj Finance’s market capitalization stood at ₹2.87 trillion, with its shares trading at ₹4,773.85 on the BSE. The finance company’s shares have risen nearly 12% so far this year.

State Bank of India has a market cap of ₹2.81 trillion. Currently, Reliance Industries Ltd is the country’s most valued company with a market cap of ₹9.48 trillion, followed by Tata Consultancy Services Ltd ( ₹8.26 trillion) and HDFC Bank Ltd ( ₹6.73 trillion).

Hindustan Unilever Ltd is number four ( ₹4.95 trillion), followed by HDFC Ltd ( ₹4.12 trillion),Infosys Ltd( ₹3.36 trillion), ICICI Bank Ltd ( ₹3.50 trillion), Kotak Mahindra Bank Ltd ( ₹3.23 trillion), and Bharti Airtel Ltd ( ₹3.07 trillion).

Despite the slowdown in consumer spending, Bajaj Finance has reported strong earnings consistently and analysts said this is a clear indication of the company’s resilient business model.

Analysts gave a thumbs-up to the finance company’s portfolio granularity strategy across products and geographic locations and its capacity to absorb higher provisions. They believe the firm will continue on its high double-digit growth trajectory.

“Overall, we remain optimistic about BFL’s growth prospects on both topline and earnings front supported by a wide and strong customer franchise (40.38 mn customer base; 65-70% of new loans generated from existing customers), unique market positioning in India with an expanding retail franchise and distribution reach, a well capitalized balance sheet, and sound ROE profile (>20%)” said KR Choksey in a report.

SBI stock has fallen nearly 4% in the last two sessions on concerns over its asset quality after the Supreme Court rejected Vodafone Idea and Bharti Airtel’s plea seeking to negotiate payment schedule in AGR case. SBI has around ₹11,200 crore exposure to Vodafone Idea. So far this year, the stock has declined nearly 5.3%.

Investor sentiment was also hit after recent December quarter earnings of SBI showed a sharp rise in slippages. The lender reported slippages of ₹16,525 crore versus ₹8,800 crore in the second quarter led by non-performing asset recognition of housing finance account. Corporate slippage came in higher at ₹9,467 crore against ₹3,239 crore quarter on quarter.

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Vodafone Idea to Pay AGR dues to DoT

Newsmantra — Mon, 17 Feb 2020 05:45:13 +0000

Vodafone Idea share price rose 18 percent in the opening trade on February 17 but erased most gains soon after. The company is likely to make payment for adjusted gross revenue (AGR) to the Department of Telecom (DoT).

It has touched an intraday high of Rs 4.09 and an intraday low of Rs 3.60.

Telecom operators Bharti Airtel, Vodafone Idea and Tata Teleservices are likely to make payment for adjusted gross revenue (AGR) dues on Monday to avoid stringent punitive action from the Telecom Department, according to official sources.

Telecom operators are collectively liable to pay Rs 1.47 lakh crore in AGR dues.The apex court on Friday came down heavily on the Telecom Department for not taking steps to recover statutory dues, estimated to be around Rs 1.47 lakh crore from operators.

The DoT issued fifth and final notice to telecom operators on February 14 for making payment on the same day, but none of the companies paid the dues.

CLSA has maintained sell call on the stock and cut target to Rs 3.50 from Rs 5.50 per share.

Broking house factor in 50 percent of AGR dues risk in its valuation.

It raises FY20-22 forecasts by 2-4 percent as Q3 revenue & EBITDA are ahead of estimates.

The company has received letters from Department of Telecommunications (DoT) directing immediate payment. The company is currently assessing the amount that it will be able to pay to DoT towards the dues calculated based on AGR (Adjusted Gross Revenue), as interpreted by the Hon’ble Supreme Court in its order dated 24 October 2019. The Company proposes to pay the amount so assessed in the next few days, company said in the press release.

According to Motilal Oswal the Supreme Court order leaves telecom companies with limited options to get relief from legal or government sources.

Could see far-reaching serious ramifications on telecom & banking sectors, said Motilal Oswal.

A duopoly market will likely to benefit Bharti Airtel and raises target to Rs 650 per share.

The incremental EBITDA potential for Bharti Airtel is at Rs 10,000 crore in FY22 and it can garner EBITDA of Rs 55,000 crore in FY22, without factoring any further ARPU increase.

Vodafone Idea’s debt burden is high, while Bharti better placed to make payments as it may continue to gain market share at an accelerated pace, said Axis Capital.

For Vodafone Idea, it’s tough to remain a going concern if there’s no change in order, while there is limited room for any change in decision either by government or any other SC bench, it added.

ICICIdirect believes that given Vodafone’s weak balance sheet and promoters’ earlier statement of their inability to infuse capital, the company is more likely to file for bankruptcy than meet the demand for the dues.

It has suspend the rating on Vodafone Idea, given this development.

It has reiterated that Bharti Airtel remains the preferred pick in the telecom space given its resilient performance amid challenging times with improving market share and relatively stronger balance sheet to weather the challenges.

At 09:32 hrs, Vodafone Idea Limited was quoting at Rs 3.84, up Rs 0.40, or 11.63 percent on the BSE.

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Bharti Airtel removed from DGFT’s ‘denied entry list’

Newsmantra — Fri, 31 Jan 2020 06:27:56 +0000

Bharti Airtel on Friday said its name has been removed from the Directorate General of Foreign Trade’s (DGFT) ‘denied entry list’, and the operator is working with authorities to complete pending formalities.

“We wish to clarify that the company has highlighted the relevant details and documents submitted to the DGFT and accordingly the name of the company has now been removed from the Denied Entry List,” the company said in a statement.

“We are actively engaged with the authorities to complete the formalities and provide additional documents for closure of the remaining cases,” Bharti Airtel said.

The telecom company, had on Wednesday, clarified to the stock exchanges that the company is closely working with DGFT to get its name removed from the list, which bans an entity from importing or exporting its goods and services.

Companies placed under the ‘denied entry list’ lose their import licence. The ban does not limit the company’s ability to import and export in the future, Airtel had said on Wednesday.

At 9:46 am, shares of Bharti Airtel were at ₹490.75, up 0.3%, on the BSE, while the benchmark Sensex was marginally higher at 40,962.49 points.

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