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Wall Street climbs with focus on stimulus - Moneycontrol.com
Latest national opinion polls pointed to a victory for Democratic challenger Joe Biden, which would mean a cooling in global trade friction, but higher taxes for corporate America.
Wall Street's main indexes rose on October 20 as investors hoped for more stimulus from Washington, with Senate Republicans preparing to vote on a bill to help small businesses hammered by the COVID-19 pandemic. House of Representatives Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin will also talk again on Tuesday, after a 53-minute telephone conversation on Monday "continued to narrow their differences" about the coronavirus aid package, a Pelosi spokesman said on Twitter. "The stimulus package seems to be the major fixation for investors right now the idea of Republicans and Democrats agreeing on the next payments going forward," said Rick Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey. Uncertainty over the fiscal stimulus weighed on Wall Street's main indexes on Monday and analysts expect market turbulence to increase with only two weeks left until Election Day. Latest national opinion polls pointed to a victory for Democratic challenger Joe Biden, which would mean a cooling in global trade friction, but higher taxes for corporate America. Meanwhile, the third-quarter earnings season has gathered momentum. Of the 50 S&P 500 companies that have reported results, 86 percent have topped expectations for earnings, according to Refinitiv IBES data. Property and casualty insurer Travelers Cos Inc gained 3.3 percent as it beat quarterly profit expectations, while consumer products giant Procter & Gamble Co advanced 1.9 percent as it raised its full-year sales forecast. All 11 major S&P sector were up in early trading with financials tracking U.S. Treasury yields. At 9:47 a.m. ET, the Dow Jones Industrial Average was up 177.90 points, or 0.63 percent, at 28,373.32, the S&P 500 was up 23.91 points, or 0.70 percent, at 3,450.83. The Nasdaq Composite was up 70.89 points, or 0.62 percent, at 11,549.77. Netflix Inc dipped 0.2 percent ahead of its third-quarter earnings report. International Business Machines Corp edged past estimates for quarterly revenue on Monday, bolstered by higher demand for its cloud services. The company's shares, however, fell 3.3 percent after it stayed away from issuing a current-quarter forecast, citing economic uncertainty related to the pandemic. The U.S. Justice Department and 11 states filed an antitrust lawsuit against Alphabet Inc's Google for allegedly breaking the law in using its market power to fend off rivals. Alphabet's shares were up 0.9 percent in morning trading. Advancing issues outnumbered decliners 4.23-to-1 on the NYSE and 2.54-to-1 on the Nasdaq. The S&P index recorded six new 52-week highs and one new low, while the Nasdaq recorded 28 new highs and 12 new lows.
Market LIVE Updates: Sensex, Nifty near day's high; HCL Tech, L&T top gainers - Moneycontrol.com
Among sectors, IT index rose 1 percent, while PSU Bank index fell 1 percent. L&T, HCL Tech, HDFC Bank, Bharti Airtel and Tech Mahindra were among major gainers on the Nifty.
Jaikishan Parmar - Sr. Equity Research Analyst, Angel Broking: For Q2FY21, HDFC life reported a good set of numbers, APE growth of 21% YoY is one of the big positive for HDFC life. Par business was the key for healthy growth, it grew by 254% YoY while Non-Par declined 19% YoY and ULIP fell 6% YoY. VNB margin expanded by 30bps to 25.6% for Q2FY21 owing to better product mix and operating efficiency. Persistency trends in the 13th/25th month improved by 200bp/400bp, led by improvement in the PAR/Protection segment. HDFC life currently; trading at 4.96x of Q2FY21 Embedded value. If we compared with listed life insurance players HDFC life is trading at a premium valuation.
Britannia Industries share price dips 5% post-Q2 earnings - Moneycontrol.com
Yes Securities has maintained a neutral stance on the stock.
Britannia Industries share price slipped over 5 percent intraday on October 20, a day after the company came out with its second-quarter earnings. The company reported a 23.2 percent year-on-year growth in consolidated profit at Rs 498.13 crore for the quarter ended September 2020 but an 82 percent increase in tax expenses hit profitability. The company's consolidated revenue grew by 12.1 percent year-on-year to Rs 3,419.11 crore in the July-September quarter. On the earnings front, earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 37.2 percent to Rs 675.39 crore YoY, while margin expanded by 361 bps YoY to 19.75 percent in Q2FY21, which was ahead of CNBC-TV18 poll estimates of 19.2 percent. The share touched its 52-week high of Rs 4,015.00 July 21, 2020 and a 52-week low of Rs 2,100.55 on March 23, 2020. It is trading 10.73 percent below its 52-week high and 70.64 percent above its 52-week low. Yes Securities has maintained a neutral stance on the stock. While higher-than-industry growth prospects, given the affordability and aggressive innovation, and ramp-up in direct distribution are key positives, limited success in non-biscuit segments and risks to the current level of margins offset the positives to a large extent. The recent underperformance though brought down valuations to 40x FY23E earnings, which can drive some upside in the near-term. Also Read - Britannia Q2 profit jumps 23% to Rs 498 crore, EBITDA margin beats estimates "On a consolidated basis for Q2FY21, Britannia Industries reported 12.1 percent growth in revenue to 3,419 crore. Due to an improvement in gross margin, the company's operating profit margin increased by 370 basis points to 19.8%. Operating margin expanded due to benign raw material cost and impact of operating leverage due to an increase in volume," said Keshav Lahoti-Associate Equity Analyst, Angel Broking. "For the quarter, operating profit and PAT increased by 37.3 percent and 22.5 percent respectively. Jump in PAT was less than operating profit due to an increase in tax rate and finance cost compared to last year. Numbers missed street expectations on all fronts of revenue, operating profit and PAT. While the Government is easing restrictions and the economy is on the path of recovery, we believe it will take some time for business to be back to normal, he added. At 1101 hours, Britannia Industries was quoting at Rs 3,584.35, down Rs 188.10, or 4.99 percent on the BSE.
Refrigerator-sized Asteroid heading towards Earth; to be closest a day before US Elections, says... - Moneycontrol
Before Tyson, NASA had predicted that a small asteroid is heading towards the Earth on November 2.
Astrophysicist Neil deGrasse Tyson has said that a refrigerator sized asteroid is headed towards Earth and will "buzz-cut" or have a close pass-by our planet on November 2, just a day before the upcoming US Elections. Asteroid 2018VP1, a refrigerator-sized space-rock, is hurtling towards us at more than 40,000 km/hr. It may buzz-cut Earth on Nov 2, the day before the Presidential Election. But its not big enough to cause harm. So if the World ends in 2020, it wont be the fault of the Universe, he wrote on Twitter handle.Asteroid 2018VP1, a refrigerator-sized space-rock, is hurtling towards us at more than 40,000 km/hr. It may buzz-cut Earth on Nov 2, the day before the Presidential Election. Its not big enough to cause harm. So if the World ends in 2020, it wont be the fault of the Universe. pic.twitter.com/eiy9G9w4Ez Neil deGrasse Tyson (@neiltyson) October 18, 2020 The astrophysicist stated the asteroid isnt large enough to cause any real damage to our planet. Adding to it, he said, if the world actually ends in 2020, then it wont entirely be the fault of the universe. Even before the Astrophysicist Neil deGrasse Tyson, NASA had predicted that a small asteroid is heading towards the Earth on November 2. It stated that Asteroid 2018VP1 is very small which is approximately 6.5 feet, and it poses no threat to Earth. It has 0.41 percent chance of entering our planets atmosphere, but if it did, it would disintegrate due to its extremely small size. Asteroid 2018VP1 is very small, approx. 6.5 feet, and poses no threat to Earth! It currently has a 0.41% chance of entering our planets atmosphere, but if it did, it would disintegrate due to its extremely small size. NASA Asteroid Watch (@AsteroidWatch) August 23, 2020 What do we know about 2018VP1 The 2018VP1 was found two years ago. According to the Space reference, it is an Apollo-class asteroid. It has an orbit period of two years i.e. 731 days and an average orbit speed of 23.63 km/s. 2018 VP1 is probably between 0.002 to 0.004 kilometers in diameter, making it a small to average asteroid, very roughly comparable in size to a school bus or smaller. The size of the asteroid to cause any amount of harm ought be atleast 140 metres or 460 feet, however, 2018VP1 is about 1 metre.
CSB Bank Q2 profit jumps nearly 3-fold, slippages fall significantly - Moneycontrol.com
At Rs 3.7 crore, slippages in the September quarter declined sharply compared to Rs 5.5 crore in the previous quarter and Rs 60.7 crore in the year-ago period.
Kerala-headquartered private sector lender CSB Bank, formerly Catholic Syrian Bank, has reported a strong set of numbers for the September quarter 2020, with profit rising nearly three-fold YoY despite higher provisions. The bank's profit for the quarter stood at Rs 68.9 crore, increasing 178.9 percent compared to Rs 24.7 crore in the year-ago period driven by net interest income (NII), non-interest income and PPoP. NII grew by 56 percent to Rs 229.25 crore YoY, with net interest margin (NIM) expansion of 81 bps YoY at 4.5 percent. "The improvements in quarterly ratios that supported higher NIM in Q2FY21 vis a vis Q2FY20 are yield on advances which increased from 10.33 percent to 10.94 percent, cost of deposits fell from 5.91 percent to 5.18 percent and the yield on investments rose from 6.52 percent to 6.74 percent YoY," CSB Bank said in its BSE filing. Advances (net) in Q2FY21 grew YoY at 11 percent, with gold-loan growth at 47 percent YoY, while total deposits grew by 13 percent YoY. "Now we are well entrenched on the growth track and have recorded a growth of over 10 percent in both deposit and advances. We could post improvement in all key metrics: NIM, Cost Income Ratio, RoA, RoE, Gross NPA, Net NPA, PCR, CRAR. We have now set our own benchmarks to be exceeded next quarter," C VR Rajendran, Managing Director & CEO said. Find All Earnings Related News Here Asset quality improved with gross non-performing assets (NPA) as a percentage of gross advances falling 47 bps sequentially to 3.04 percent, while net NPA fell 44 bps QoQ to 1.30 percent in the September quarter. Slippages at Rs 3.7 crore in Q2FY21 declined sharply compared to Rs 5.5 crore in the previous quarter and Rs 60.7 crore in the year-ago period. Provisions and contingencies increased significantly to Rs 80.72 crore in the quarter, up 40.3 percent QoQ and 228.5 percent YoY. The provision coverage ratio improved to 84.24 percent as of September 2020 from 81.7 percent in the June quarter. Non-interest income in Q2FY21 shot up 80 percent to Rs 97.6 crore in the second quarter, with the backing of increased treasury profits, processing fee and PSLC income, the bank said, adding operating profit surged 172.6 percent YoY to Rs 172.8 crore in Q2FY21. CSB Bank shares were trading at Rs 233.85 on the BSE, up 1.39 percent.
What should investors do with Avenue Supermarts post-Q2 results: buy, sell or hold ? - Moneycontrol.com
Prabhudas Lilladher has upgraded D-Mart to 'buy' with a target price of Rs 2,316.
Avenue Supermarts, the operator of the D-Mart, rose 3 percent intraday on October 19 after the company came out with its Q2FY21 earnings. The company reported a 38.5 percent year-on-year decline in consolidated profit for the quarter ended September 2020 but sequentially, profit grew five-fold amid the easing of lockdown restrictions. The company's revenue during the quarter also fell 11.4 percent to Rs 5,306.2 crore compared to the year-ago period but there was 36.6 percent sequential growth. Other income also supported profitability, rising significantly to Rs 52.2 crore in the September quarter from Rs 8.1 crore YoY. Here is what brokerages have to say on the stock after Q2 earnings: ICICIdirect Over the years, D-Mart has proven to be a resilient business model generating superior RoIC of 23 percent and a healthy fixed asset turnover ratio of 4.1x. Of the total QIP proceeds (Rs 4078 crore), the company has utilised Rs 1,213 crore mainly towards retirement in total debt (~Rs 700 crore). The robust liquidity position is expected to provide impetus to the store-addition pace (mainly from FY22E onwards). Near-term headwinds may have a negative impact on the performance in FY21E but the broking house remains structurally positive on the company and its long-term prospects. It has upgraded rating from hold to buy with a reduced target price of Rs 2,300 (38.0x FY23E EV/EBITDA) from Rs 2,360. Prabhudas Lilladher We are upgrading D-Mart to buy with DCF(discounted cash flow)-based target price of Rs 2,316 from Rs 2,057 earlier). 2Q21 results were a miss on broking firms estimates given slower than expected pickup in sales and lower Gen Merchandise mix impacting margins. It estimates 28.4 percent PAT CAGR over FY20-23 and 28.5 percent over FY20-25, showing the resilience of business model, though it cut EPS by 10.6 percent, 3.4 percent and 2.9 percent for FY21/22/23. It has upgraded the stock to buy. Motilal Oswal We expect D-Mart to deliver FY20-22E revenue/EBITDA CAGR of 20 percent/18 percent. Motilal Oswal believes the gradual unlocking would lead to positive sales from 3QFY21, supported by improving sales from the general merchandise and apparel category.It values D-Mart at around 20 percent discount to its three-year average EV/EBITDA multiple of 54x, implying a 6 percent upside. It retained its neutral recommendation on the stock. Jefferies The research house maintained a buy rating with a target of Rs 2,600. The company saw a sequential improvement (QoQ & MoM). The Q2 performance was slightly ahead of its estimate but below consensus. The FMCG & staples grew YoY in September and so did the basket value. Footfalls were lower but improving, with the festival season holding the key. However, there is progress on ecomm but lack of transparency was an issue, CNBC-TV18 quoted the research house as saying. At 1214 hours, Avenue Supermarts was quoting at Rs 2,046.25, up Rs 62.05, or 3.13 percent on the BSE.
What should investors do with HDFC Bank after Q2 results: buy, sell, or hold? - Moneycontrol.com
The company reported an 18.4 percent year-on-year growth in profit at Rs 7,513.11 crore for the September quarter.
HDFC Bank share price rose 3 percent in the early trade on October 19 after the company posted its September quarter earnings over the weekend. The company reported an 18.4 percent year-on-year (y-o-y) growth in profit at Rs 7,513.11 crore for the September quarter, driven by PPoP, NII and lower tax rate. The profit in the year-ago period was at Rs 6,345 crore. Net interest income (NII), the difference between interest earned and interest expended, increased by 16.7 percent year on year to Rs 15,776.4 crore in the quarter, driven by asset growth of 21.5 percent and a core net interest margin for the quarter at 4.1 percent. Here is what brokerages have to say about the stock after the Q2 earnings: ICICIdirect | Rating: Buy | Target: Rs 1,450 Digital initiatives and strong festive tie-ups are seen propelling retail credit growth ahead. This, coupled with healthy traction in corporate disbursement, is seen as keeping the business momentum ahead of the industry. Improvement in collections at 97 percent and contingent provision at ~75 bps of advances provides cushion from high volatility in asset quality and earnings. Though the management refrained from providing an indication about restructuring, improving collections are seen keeping the quantum in lower single digits. Adequate capital with CaR at 19.1 percent and healthy internal accrual and operational efficiency provide confidence about future business and earnings growth. Thus, ICICIdierct remains positive on the bank and maintains a buy rating with a revised target price of Rs 1,450 per share, valuing the core bank at ~3.8x FY22E ABV and adding Rs 50 in lieu of subsidiaries. Motilal Oswal | Rating: Buy | Target: Rs 1,400 HDFC Bank has delivered strong growth amid a challenging macro environment and business momentum is swiftly moving toward pre-COVID levels. The banks operating performance remains steady, aided by healthy revenue growth and controlled opex. The bank continued to make healthy provisions to further strengthen the balance sheet and still reported stable in-line earnings. Overall, Motilal Oswal expects a marginal deterioration in asset quality/ earnings growth (on a high base) in 2HFY21. Although a healthy provision buffer would limit the damage and enable the bank to quickly recover to a normal growth run-rate. It maintains earnings estimates for FY21/FY22 and also introduce FY23E. It estimate a 19 percent PAT CAGR over FY20FY23E, with ROA/ROE at 2 percent/ 17.8 percent for FY23E. Maintain buy, with a revised target price of Rs 1,400 (3.1x Sep22E ABV). Dolat Capital | Rating: Buy | Target: Rs 1450 With the focus on top-end customers across segments, superior underwriting and healthy provisioning and capital buffers (CET 1 ratio at17%), Dolat Capital sees HDFC Bank as best placed amid current uncertainty. It has factored in incremental stress (RSA+ slippage) of 3.7 percent for the bank. Tweaking the estimates marginally and rolling over to Sep-22E, it maintains a buy recommendation on the stock with a SOTP-based target price of Rs 1,450, implying 3.4x Sep-22E P/ABV. The stock currently trades at 2.8x Sep-22E ABV. Prabhudas Lilladher | Rating: Buy | Target: Rs 1,385 HDFC Banks earnings were marginally lower than expected at Rs 75.1 billion (PLe: Rs 75.9 bn). Miss was from NII, which grew by 17 percent YoY (PLe: 18 percent YoY) on a slightly sharper NIM decline of 20bps QoQ and slightly higher provisions for strengthening balance sheet. The bank is placed in a strong position with prudent provisioning buffers at 0.7 percent of loans and high PCR of 85 percent (pro-forma 75 percent) and should have much lower restructuring and asset-quality outcome than the industry. The broking house has retained a buy rating with a revised target price of Rs 1,385 from Rs 1,265 based on 3.1x multiple as it rolled over its valuations to Sep-22 ABV. Sharekhan | Rating: Buy | Target: Rs 1,500 HDFC Banks Q2FY2021 results were strong with operational performance in line with expectations. Asset quality improved on a q-o-q basis. Results indicated a revert to normalcy. The management commentary was positive and reassuring and indicated a bright long-term outlook. The bank indicated a strong deal pipeline in the corporate segment and expects robust retail credit pickup, led by healthy disbursement trends. With the management transition behind it, the bank is looking to leverage technology/reach to gain market share across business lines, buoyed by better efficiencies and, thereby, deliver superior RoAs. The brokerage expects HDFC Banks business quality and franchise strength will help it tide over near-term challenges. Kotak Institutional Equities | Rating: Add | Target: Rs 1,300 The company reported 18 percent YoY earnings growth on healthy operating profit growth. The solid performance on asset quality implies a sizeable lead versus all banks. Strong operating profits give it an adequate cushion to manage stress, CNBC-TV18 reported the brokerage as saying. Nomura | Rating: Buy | Target: Raised to Rs 1,450 from Rs 1,325 The franchise strengths were showing up, while collections were nearing normalisation. The SME stress for 30 dpd (Days Past Due) reduced to 3 percent from 9 percent earlier and reduced credit cost estimate to 1.6 percent/1.3 percent for FY21/FY22, respectively. Nomura expects ROE of 17-18 percent by FY22-23, reported CNBC-TV18. Jefferies | Rating: Buy | Target: Raised to Rs 1,450 from Rs 1,350 The bank is holding up, while HDB finance faces the pressure. Its September collections were indicating restructuring to be at just 1-2 percent of loans The retail momentum pick-up will help topline and encouraged to see 27 percent growth in CASA. The lower funding cost enabling market share gain in corporate loans, reported CNBC-TV18 CLSA | Rating: Buy | Target: Raised to Rs 1,525 from Rs 1,450 The collections and new business trends were strong. It reduced credit cost estimate to 3 percent for FY21-FY22 from 3.2% and increased PPoP estimate by 1-2 percent due to better fee income, reported CNBC-TV18. Edelweiss Securities | Rating: Buy | Target: Raised to Rs 1,490 from Rs 1,335 The bank's profits beat estimate due to higher other income. The exit month collection efficiency and disbursals run-rate shy of pre-COVID levels. The stability achieved and growth aspirations were renewed, reported CNBC-TV18. Axis Capital | Rating: Buy | Target: Raised to Rs 1,450 from Rs 1,350 It was a strong show with normalcy returning sooner than expectations. The retail bank seems to have moved ahead with little damage. The disbursals in retail is at 80 percent of pre-COVID levels while HDB Finance reported a weak performance, reported CNBC-TV18. Macquarie | Rating: Outperform | Target: Raised to Rs 1,489 from Rs 1,219 The management painted a very positive outlook on asset quality. The customer segment has been relatively insulated and salary credits quite regular. The non-moratorium book collections are similar to pre-COVID levels. The 50 bps reduction in credit cost will result in earnings rebound of 15-20 percent, CNBC-TV18 reported the brokerage as saying. At 0922 hours, HDFC Bank was quoting at Rs 1,211.80, up Rs 12.45, or 1.04 percent on the BSE.
'We are not afraid': France rallies after beheading of teacher - Moneycontrol
Demonstrators on the Place de la Republique held aloft posters declaring: "No to totalitarianism of thought", and "I am a teacher" in memory of murdered colleague Samuel Paty.
Tens of thousands of people rallied in Paris and cities across France in solidarity with a teacher beheaded for showing pupils cartoons of the Prophet Mohammed, as President Emmanuel Macron promised swift action against online extremism. Demonstrators on the Place de la Republique held aloft posters declaring: "No to totalitarianism of thought", and "I am a teacher" in memory of murdered colleague Samuel Paty. "You do not scare us. We are not afraid. You will not divide us. We are France!" tweeted Prime Minister Jean Castex, who joined the Paris demonstration on Sunday. Castex was joined by Education Minister Jean-Michel Blanquer, Paris mayor Anne Hidalgo and junior interior minister Marlene Schiappa. Some in the crowd chanted "I am Samuel", echoing the widespread "I am Charlie" cry after Islamist gunmen killed 12 people at the Charlie Hebdo satirical magazine in 2015 for publishing caricatures of the Islamic prophet. Between bursts of applause, others recited: "Freedom of expression, freedom to teach." "I am here as a teacher, as a mother, as a Frenchwoman and as a republican," said participant Virginie. The Charlie Hebdo attack in 2015 unleashed a wave of Islamist violence and forced France into a national discussion about Islam's place in a secular society. After the magazine assault, some 1.5 million people gathered on the same Place de la Republique in support of freedom of expression. Things have to change On Sunday, President Emmanuel Macron ordered swift and "concrete action" to counter radical Islamist propaganda online. At a meeting with six ministers and anti-terror prosecutor Jean-Francois Ricard, Macron said there would be "no respite for to those who organise to oppose the Republic's order". The presidency said action would be taken against anyone expressing support for the attack, without giving any further details Sunday. And authorities said from Monday, they would investigate the authors of 80 messages of support for the attacker. Ministers in France's defence council also agreed to step up security at schools when they return after half term. Over the weekend thousands rallied in cities across France, with hundreds of people marching in Nice on the south coast, where in July 2016 a man killed 86 people when he rammed a truck into a crowd. "Everyone is in danger today," said student Valentine Mule, 18, attending the Nice rally. "Things have to change." Paty was murdered on his way home from the school where he taught in a suburb northwest of Paris on Friday afternoon. A photo of the teacher and a message confessing to his murder was found on the mobile phone of his killer, 18-year-old Chechen Abdullakh Anzorov, who was shot dead by police. Witnesses said the suspect was spotted at the school on Friday asking pupils where he could find Paty. On Saturday, anti-terror prosecutor Ricard said the teacher had been the target of online threats for showing the cartoons to his civics class. Depictions of the prophet are widely regarded as taboo in Islam. Online Campaign The father of one schoolgirl had launched an online call for "mobilisation" against the teacher and had sought his dismissal from the school. The parent had named Paty and given the school's address in a social media post just days before the assault, which Macron labelled an Islamist terror attack. The father and a known Islamist militant who was involved in his campaign against Paty are among those arrested, along with four members of Anzorov's family. An 11th person was taken into custody on Sunday, a judicial source said, without providing details. Ricard did not say if the assailant had any links to the school or had acted independently in response to the online campaign. The Russian embassy in Paris said Anzorov's family arrived in France from Chechnya when he was six to seek asylum. Locals in the Normandy town of Evreux where the attacker lived described him as low key, saying he got into fights as a child but had calmed down as he became increasingly religious in recent years. Friday's attack was the second of its kind since a trial started last month over the Charlie Hebdo killings. The magazine republished the controversial cartoons in the run-up to the trial, and last month a young Pakistani man wounded two people with a meat cleaver outside Charlie Hebdo's former office. Doing his job According to his school, Paty had given Muslim children the option to leave the classroom before he showed the cartoons, saying he did not want their feelings hurt. Kamel Kabtane, rector of the mosque of Lyon and a senior Muslim figure, told AFP on Sunday that Paty was merely been "doing his job" and had been "respectful" in doing so. A national tribute is to be held for Paty on Wednesday.
DLF raises Rs 2,400 crore from SBI to refinance debt, fund ongoing commercial projects - Moneycontrol
DLF Cyber City Developers Ltd (DCCDL), the joint venture between DLF and Singapore sovereign fund GIC, has 33 million sq ft of office and retail properties generating an annual rental income of Rs 3,500 crore.
Realty major DLF's rental arm DCCDL has raised Rs 2,400 crore debt from India's largest lender SBI to refinance its existing debt and fund future expansion plans, a senior company official said. In an interview with PTI, DLF's group chief financial officer (CFO) Vivek Anand said the debt has been raised at a very attractive interest rate of 7.35 percent, enabling the company to reduce interest cost. DLF Cyber City Developers Ltd (DCCDL), the joint venture between DLF and Singapore sovereign fund GIC, has 33 million sq ft of office and retail properties generating an annual rental income of Rs 3,500 crore. DLF holds 66.66 percent stake in DCCDL while GIC has the rest. "DCCDL has secured funding of Rs 2,400 crore from India's largest public sector bank SBI. It sets a benchmark for lease rental discounting (LRD) in the country," Anand told PTI. The fund has been raised through the LRD route against a rental portfolio of 2.4 million sq ft area in Cyber City, Gurugram. "It is one of the biggest disbursements by any public sector bank during the COVID-19 pandemic. This also clearly demonstrates our strong tenant profile and ability to generate cash for a long-term period," said Anand, who joined the company last year. Asked about utilisation of funds, Anand who is a chartered accountant by profession with 25 years of experience across businesses, said DCCDL has refinanced its existing debt worth Rs 1,950 crore while Rs 450 crore will be used for future expansion. At present, DCCDL has a debt of around Rs 19,500 crore. "In the short to medium term, the debt of DCCDL will remain at Rs 20,000 crore level because of our plan to expand portfolio," Anand said. He noted that the company has chalked out a plan to develop 18 million sq ft of commercial assets, of which 4 million sq ft is already under construction in Chennai and Gurugram. Talking about the operational performance of the rental business during this pandemic, Anand said the DCCDL's rental collections and occupancy level were robust at over 95 percent during the first half of this fiscal and the outlook remains positive. He said the company has not reduced rental of leased office space, but rents have been deferred in few cases. Referring to retail real estate segment, Anand said the shopping malls business has been impacted due to the outbreak COVID-19 and subsequent lockdown during April-May. He said footfalls in its malls, which were allowed to open from June, have reached 50-60 percent of the pre-COVID-19 level. With multiplexes opening and ease of curb in food and beverages (F&B) segment, he hoped that footfall would gradually increase. However, Anand highlighted some positive trends in retail space like conversion rates being higher with only serious buyers visiting shopping malls and international brands doing better due to restrictions in overseas travel. The group CFO said the DCCDL is going ahead with its expansion of office portfolio, and the construction work is being undertaken at ongoing projects in Chennai and Gurugram. Anand said the company's rental income will rise further as rent from its Cyber Park project has started accruing from this month. This 2.5 million sq ft project will help it earn Rs 350 crore annually. DLF had formed a joint venture with GIC in December 2017 after its promoters sold their entire 40 percent stake in the DCCDL for nearly Rs 12,000 crore. This deal included sale of 33.34 percent stake in DCCDL to GIC for about Rs 9,000 crore and buyback of remaining shares worth about Rs 3,000 crore by the DCCDL.
Government unlikely to extend credit guarantee scheme for MSME sector beyond October - Moneycontrol
Sources said the objective is to provide support to all those affected and if there are no takers for the scheme, there is no need to extend the scheme even though there is some room left.
The government is unlikely to extend the Rs 3 lakh crore-Emergency Credit Line Guarantee Scheme (ECLGS) for MSME sector beyond October even though the sanctioned amount so far is only nearly 65 percent of the target, sources said. The scheme is meant to provide financial support to businesses, primarily Micro, Small and Medium Enterprises (MSMEs), impacted by slowdown triggered by the coronavirus pandemic. The sources said the objective is to provide support to all those affected and if there are no takers for the scheme, there is no need to extend the scheme even though there is some room left. On August 1, the government widened the scope of the Rs 3 lakh crore-scheme by doubling the upper ceiling of loans outstanding and including certain loans given to professionals like doctors, lawyers and chartered accountants for business purposes under its ambit. To ensure more companies can benefit from the scheme, it was decided to increase the upper ceiling of loans outstanding as on February 29 for being eligible under the scheme from Rs 25 crore to Rs 50 crore. The maximum amount of Guaranteed Emergency Credit Line (GECL) funding under the scheme was correspondingly increased from Rs 5 crore to Rs 10 crore. Announced as part of the government's Rs 20.97 lakh crore-economic package in the wake of the coronavirus pandemic, the scheme was later tweaked to be made applicable for companies with an annual turnover of Rs 250 crore as against the earlier threshold of Rs 100 crore. Banks and Non-Banking Financial Companies (NBFCs) have approved loans worth about Rs 1,87,579 lakh crore while disbursement stood at Rs 1,36,140 crore as on October 5. On May 20, the Cabinet approved additional funding of up to Rs 3 lakh crore at a concessional rate of 9.25 percent through ECLGS for MSME sector. Under the scheme, 100 percent guarantee coverage will be provided by the National Credit Guarantee Trustee Company (NCGTC) for additional funding of up to Rs 3 lakh crore to eligible MSMEs and interested Micro Units Development and Refinance Agency (MUDRA) borrowers in the form of GECL facility. The scheme will be applicable to all loans sanctioned under GECL facility during the period from the date of announcement of the scheme to October 31 or till the amount of Rs 3 lakh crore is sanctioned under GECL, whichever is earlier.