TATA-Walmart deal: A real game-changer in the Indian business landscape [Flickr]

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The latest TATA-Walmart deal. In May 2018, the global retail giant Walmart purchased a 66% stake in Flipkart for $16 billion. Till date, it has been the country’s biggest-ever deal in the retail space. But, this may be overtaken latest by January 2021 by a new ambitious deal coming up between TATAs and Walmart.

One of the biggest news that has come up in recent times is: "Walmart is considering a $25 billion investment into Tata Group's Super App."

The TATAs proposed super-app may be launched as a joint venture, combining the Tata Group’s entire retail product franchise and Flipkart’s offerings from Walmart.

Waiting to be lifted

Super Apps from Tata group can definitely provide a comprehensive solution for B2B2C. The Tatas seem to be working with advisers to bring in global tech companies, including investors, for the digital entity. Goldman Sachs may have been asked as the investment bank for this deal.

Tatas, the pioneer of the Indian tech industry, stayed inactive for a while but now the group is catching the super app fever. It may have to reset its supply chain network. Given how foreign capital has built a strong infra for online/e-commerce, this is the most promising time for super apps to mushroom.

Amazon and Reliance Jio, which is planning a similar offering with Facebook are set to have a new competitor in terms of variety and economies of scale. moneyinvestors.in/tata-walmart/

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Amarin Corp. shares crash 67% to $4.47 after a court ruling [Flickr]

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Amarin Corp - a pharmaceutical company developing and commercializing therapeutics to improve cardiovascular health - recently has been jolted by a court's ruling. Amarin Corp was founded in 1993 and is headquartered in Dublin, Ireland for the purpose of taxes. Traded at ‎NASDAQ as AMRN.

Benchmark indices ended almost flat after a volatile session on Tuesday. As per provisional closing data, the S&P BSE Sensex fell 8.41 points at 37,973.63. The Nifty 50 index lost 5.15 points at 11,222.25.

IndicesDateChange% ChangeNikkei30-09-2020-82.3-0.35Straits Times30-09-20203.750.15DOW Jones29-09-2020-131.4-0.48Shanghai29-09-20206.830.21Hang Seng29-09-202000Nasdaq29-09-2020-32.25-0.29DAX29-09-2020-45.05-0.35CAC 4029-09-2020-11.2-0.23FTSE29-09-2020-30.43-0.51World Indices today

There were more sellers than buyers. On the BSE, 1178 shares rose and 1436 shares fell.

In corona age, pharma companies have more work to do

The rating agency, Icra, after market hours on Monday, revised its forecast for contraction in GDP for FY21 to -11% from -9.5% as fresh Covid-19 infections remaining elevated at the end of the second quarter. The agency, however, retained its earlier forecast of a 12.4% contraction in GDP in the second quarter.

Notable scrips which declined appreciably:

Radico Khaitan (down 3.9%), Globus Spirits (down 3.28%), Advanced Enzyme (down 3.22%), Dhampur Sugar (down 3.05%), Tata Consumer (down 3%), Kaveri Seed (down 2.46%), ADF Foods (down 2.39%), moneyinvestors.in/amarin-corp/

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Cadila Healthcare: Strongest rally in 3 years signifies a turnaround [Flickr]

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Cadila Healthcare has been seeing the strongest rally in recent times which clearly indicates a structural transformation. Time to enter!

Stable earnings visibility, least stressed balance sheets, healthy free cash flows and ability to deliver products at the time of crisis are some key attributes of Indian pharma.

Over the last few quarters, most players are recalibrating CAPEX and R&D spend in order to optimise capital utilisation. The current situation, underpinned by Covid-19 pandemic and its negative impact on most sectors, further strengthens the argument for investment in pharma.

While the Q1 performances of most pharma companies have been skewed, H2 should reflect the normalised trend.

Technically, the Pharma index has registered a structural turnaround on long term charts. At the current juncture, Cadila Healthcare and Caplin Point Laboratories seem to be well placed in terms of a favourable risk-reward set-up from a medium-term perspective.

The pharma sector has been relatively outperforming over the past couple of months after witnessing a structural turnaround off March 2020 lows, signalling a reversal of five-year-long downtrend.

o In the pharma space, Cadila Healthcare has been relatively underperforming. However, currently, it has been seeing a faster pace of retracement as it retraced past five week’s decline (Rs 412-358) in just a single week, signalling an acceleration of upward momentum, auguring well for the next leg of up. moneyinvestors.in/cadila-healthcare/

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FICCI for Start-ups Initiative [Flickr]

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SAVE THE DATE

LAUNCH INVITATION: “FICCI for Start-ups”Date: October 1, 2020Time: 3:00 PM to 4:00 PM (IST)

We invite you to the launch of “FICCI for Start-ups” initiative of the Federation of Indian Chambers of Commerce and Industry (FICCI). Under this initiative, FICCI will provide a wide array of services and benefits to the Indian start-ups. The prime aim of the initiative is to provide a voice to the startups in India.

A comprehensive benefits package has been developed by FICCI under the said initiative which includes connecting start-ups to FICCI corporate members, mentorship by industry experts, direct connect to the Indian Angel Network, access to soon to be set up FICCI-IAN social venture fund, access to FICCI innovation and start-up programs, exhibitions, delegations, conferences at special costs, connect to the global investor community, policy advocacy with the government on behalf of start-up members among others.

Learn more at the launch event by registering here: webinar.ficci.com/startups/index.php

BE THERE!

In July 2020, FICCI had conducted a nationwide survey on the 'Impact of COVID-19 on Indian Start-ups' jointly with the Indian Angel Network (IAN), 250 start-ups, 61 incubators and investors. The covid has had a huge impact on the Indian businesses, especially for the SMEs and Start-ups. moneyinvestors.in/ficci/

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India's $22 billion bond market [Flickr]

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The bond market also drives India’s economy which is otherwise slowing, inflation is sputtering and the central bank is cutting interest rates. But the cost of long-term money is refusing to budge. The reason, in a single word: upcoming elections. Polls are scheduled in states. Prime Minister Narendra Modi probably would have liked to make NDA's reelection endorsement with less distress in the farm economy and a better jobs track record. If he hadn’t scored an own goal by banning 86 per cent of the country’s cash overnight, he might even have succeeded. Team Modi will end the fiscal year on March 31 with a huge deficit of roughly $190 billion, a pre-poll bump that doesn’t appear to have helped in pump-priming the economy.

The Gross Domestic Product (GDP) in India grew 0.70 per cent in the first quarter of 2020 over the previous quarter. It comes as little surprise that the country recorded its slowest GDP growth rate recently. More weakness is expected in the coming three months ending December 2020. That can only mean more disinflation and deeper interest-rate cuts. Why, then, is the 10-year Indian government bond yield doing very well, more than double the expected inflation rate for the year?
For both NBFC and corporate categories of bonds, the ranges grew by nearly 30-40 basis points between February 2020 and April 2020. moneyinvestors.in/bond-market/

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CAMS: Most Exciting IPO Opportunity [Flickr]

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Why invest in CAMS IPO?

Computer Age Management Services Limited (CAMS) is India’s largest registrar and transfer agent of Mutual Funds with an aggregate market share of approximately 70%, based on Mutual Fund Average Assets Under Management (AAUM) managed by its clients and serviced by it during July 2020, according to the CRISIL Report.

Largest infrastructure and services provider in a large and growing Mutual Funds market.The ten-year CAGR of QAAUM (Quarterly Average AUM) of Mutual Funds between March 2010 and March 2020 was 13.4% according to the CRISIL Report, while the ten-year CAGR of QAAUM of Mutual Funds serviced by CAMS over the same period was 15.8%.

Integrated business model and long-standing client relationships in our Mutual Funds services businessIts pan-India physical network comprises of 271 service centres spread over 25 States and 5 Union Territories as of June 30, 2020. Its Mutual Fund clients include 4 of the 5 largest Mutual Funds as well as 9 of the 15 largest Mutual Funds based on AAUM during July 2020.

Established track record of delivering robust financial resultsIts total income for the three months ended June 30, 2020, and the Financial Year 2020 was ₹1,634.61 million and ₹7,213.43 million, respectively. Its profit after tax for the three months ended June 30, 2020, and the Financial Year 2020 was ₹408.25 million and ₹1,734.56 million, respectively.

Issue Details moneyinvestors.in/?p=51748

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One World, One Sun, One Grid: Is it possible? [Flickr]

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With war clouds hovering around several Nations in the world, will it be ever possible for us to see a One World One community?

One basic need of the humans - Energy - seems to have the potential to bring and connect people of the world to come together cutting across geographical barriers.

September 8, 2020. The International Solar Alliance (ISA) organised a virtual World Solar Technology Summit.

India's Prime Minister Narendra Modi was earlier expected to deliver the inaugural address but could not do so because of some other engagements. His message was read out by the New and Renewable Energy Minister R K Singh.

The PM Modi expressed his visions on humanity and the global use of clean energy supplies across nations. He mentioned the idea of 'One World, One Sun, One Grid'. The Prime Minister also mentioned that ISA is part of this project which can bring transformational benefits for the entire humanity.

The PM Modi made it clear that his government wants to take solar energy to all villages of India and replace fossil fuels with this clean source in agriculture.

India's existing clean energy capacity is 134 GW. It will be scaled up to 220 GW by 2022.

The PM Modi exuded confidence that India will reduce energy tariffs further through technological advancements. A further reduction in the cost will provide a major boost to the use and expansion of renewable energy. moneyinvestors.in/solar/

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Time to Buy Infosys is Now [Flickr]

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In the current market scenario, we have seen stocks from underperforming sectors witnessing sharp upsides while performing spaces like technology took a breather. We believe that after a round of profit booking, technology stocks will resume their uptrend. Infosys has been hovering around Rs 900 levels for a while. Now, it is likely to witness upsides on the back of fresh formation of long positions

Buy Infosys in range of Rs 915-935, Target: Rs 1090; Stop Loss: Rs 840; Time frame: Three months

Last closing price - Rs 925.00Beta - 0.6512M Avg Price - Rs 753.03M Avg Roll (%) - 87.0%HV 30 Day (% Annualised) - 25.40

Price vs. open interest pattern. Fresh accumulation is likely to take stock higher

 The open interest in Infosys has been gradually declining in the last couple of weeks as the stock surpassed its major resistance of Rs 840 in July lost its quarterly results. Since then, the short covering has propelled the stock towards Rs 975. The stock started the September series with almost six month’s low open interest. We believe it will attract fresh long additions from here onwards and is well placed to move above Rs 1000

 In the options space, the stock had the highest Put OI base at the 900 strikes in August as well September series. Despite continued strength in the rupee, the stock was able to hold these levels amid profit booking and has started moving up. moneyinvestors.in/buy-infosys/

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Beat Lockdown Blues; Try the 'Happiest Minds Technologies' Guide [Flickr]

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IPO of Happiest Minds Technologies Limited is now open for subscription. Minimum order quantity is 90 shares which is available at a price band of Rs.165 - Rs.166 per share.

Happiest Minds Technologies (HMT)

HMT focuses on delivering a seamless digital experience to its customers. The company’s offerings include, among others, digital business, product engineering, infrastructure management and security services. The company’s capabilities include giving end-to-end solution in the digital space. HMT has repeat business from its customer base, which includes more than 35 Fortune 2000/Forbes 200/billion dollar corporations.

The company’s broad range of offerings helps to up-sell while multiple business units (BUs) help it to cross-sell to existing customers as well as to acquire new customers. Its average revenue per customer has increased from US$471,472 in FY18 to US$501,562 in FY19 to US$614,675 in FY20. The company’s total income & EBITDA has grown at a CAGR of 20.8% and 285.3%, respectively between FY18 and FY20.

Strong brand in digital IT services

The global enterprise digital spend is expected to be ~US$691 billion in 2019 and is expected to grow to US$2,083 billion by 2025 at a CAGR of 20.19%. In FY20, 96.9% of revenues came from digital services. This is one of the highest among Indian IT companies. Broadly, the company’s target market includes business services, IT services, infrastructure-as-a-service, applications, application development and deployment. moneyinvestors.in/make-money/

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Renewable Energy Shows to way to make money [Flickr]

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Renewable energy stocks have teased investors with their promise for years. On the one hand, it's easy to dream on the sector's growth potential given the need to transition the global economy away from its current fossil fuel-based approach to a more sustainable one. According to one estimate, the world's developed economies need to invest a staggering $10 trillion in the coming years to make the switch. However, despite all the investments in the sector, most clean energy stocks have significantly underperformed the market over the years.

Two factors have driven this underperformance: intense competition and weak financial profiles. With so many companies focused on doing the same thing, the industry has fought against itself for growth opportunities, which has hurt investment returns. Meanwhile, most clean energy companies focused on growing as fast as they could despite the lacklustre returns. As a result, many stretched themselves too thin, putting pressure on their balance sheets and stock prices and burning investors in the process.

A small group of renewable energy companies, however, have thrived despite the sector's issues. That's allowed them to consistently create value for their investors over the years.

One of the defining characteristics of these outperformers is that they aim to grow the value of their company, not just its size. Thus, those who want to invest in renewable energy stocks should seek out companies focused on this pursuit. moneyinvestors.in/renewable-money/

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Fliers Stop Flying, Airlines Losses Mount; Is Anyone Gaining? [Flickr]

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While the fliers have not yet resumed flying, it is now being widely recognised that the global aviation industry is going through the toughest-ever phase in its 100-year old history. The uncertainty of survival is bound to cause unprecedented turmoil and has fully paralysed the sector.

Rating agency Crisil reports that the unprecedented plunge in demand for air travel will badly impact the financials of airlines. It reports that the aviation industry will lose revenue to the tune of Rs 240,000–250,000 million. Airlines will see more than 70% of the losses, and airport operators will lose Rs 50,000 million and airport retailers, including retail, food and beverages and duty-free outlets will lose Rs 17,000 million.

In other words, the general public could save up to Rs 240,000–250,000 million by not availing air services. Things such as food and beverages and duty-free items and even flying are after all dispensable for fliers.

Not availing air services also causes less fuel burn and a cleaner environment.

The fear of corona has driven away the fliers. In June 2019, low-cost airline Spicejet had 94% occupancy, it is 68% in June 2020. At this level, the airline can not break even. It means not operating will be more profitable.

India’s two listed airlines, IndiGo and SpiceJet, lost up to Rs 125 billion across January-March and April-June quarters.

Operations at India's two biggest airports - Delhi and Mumbai - dropped by 67% and 87% in June 2020 respectively. ncairways.co/fliers/

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