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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Many airlines try to boost domestic and international flights [Flickr]

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Despite the aviation industry being hit by the outbreak of Covid-19 pandemic, many airlines are preparing to join other airlines in the intercontinental market by December 2020. They seem to be working very hard for the restart of the air services.
The $1.9 trillion money manager, Pacific Investment Management Co. anticipates an economic recovery and that the next market rally will lift the aviation sector - beaten-down the most by the pandemic- as people start to travel again.

Also Read: Covid-19 Spread Sparks Fresh Panic in the Aviation Sector

Mexican Airline Interjet

Interjet is one of Mexico’s three biggest airlines. It operates on more than 50 routes.

As the coronavirus pandemic devastated global air travel, Interjet availed a $150 million capital support in July 2020 to get it through a substantial restructuring in an effort to lessen the effect of the crisis in the airline sector.

August 30, 2020. Interjet is now in a position to increase the number of routes and frequency of its domestic flights beginning from September. It will hopefully boost travel options to Mexico's northern states and popular tourist destinations.

Interjet will have to enforce health and safety measures. It will offer its passengers free rapid COVID-19 tests and N95 masks.

Uganda Airlines

Recently, Uganda Airlines celebrated its first anniversary. The airline had collapsed in 2001 but was relaunched after 18 years. It has four planes at present. ncairways.co/many-airlines/

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Worse crisis yet to be seen by global airlines [Flickr]

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Today, the global airlines are struggling through a worse crisis since the first commercial service began flying passengers nearly 100 years ago. The Covid-19 pandemic has exerted a long-term and profound impact globally.

Domestic passenger numbers in some markets have slowly started signs of recovery from COVID-19 lockdown lows, especially in Asia.
Chinese airlines recover from such a worse crisis
Chinese airlines hope for local travel boost. The aviation market in China has been the first to rebound from such a worse crisis, and the overall trend of recovery and development appears to be prosperous. Strong potential demand for air-passenger travel if the virus is suppressed.

Air travel in China has mostly returned from its pre-COVID-19 levels, with about 15m seats scheduled in the week to August 30, indicating the pace of the country's economic rebound.

Japan has also resumed normal service. Domestic travel is not subject to the same level of restrictions as cross-border flights, leaving it well-positioned to lead any recovery from this worse crisis.

China, where the disease first emerged in 2019 has reported no new deaths since May 2020. A tentative return of business and tourist travel within its borders can be seen here, even as the virus wreaks havoc elsewhere. Here domestic travel has picked up with the coronavirus outbreak brought largely under control. ncairways.co/worse-crisis/

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Will India send a military contingent to participate in a war game in Russia? [Flickr]

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Russia has been a major partner of India in the defence sector and the cooperation has been steadily growing further. In a few days from now, a multilateral war game is going to be held in the Astrakhan region in southern Russia from September 15 to 26. The participating countries include India's neighbours - China and Pakistan in addition to a number of other member nations of the Shanghai Cooperation Organisation (SCO), an influential regional grouping.

The SCO is viewed as a counter to NATO. It has emerged as one of the largest transregional international organisations. It accounts for nearly 44 per cent of the world population stretching from the Arctic Ocean to the Indian Ocean and from the Pacific Ocean to the Baltic Sea.

Earlier, India had communicated to Russia that it will participate in the said strategic command-post exercise. India had planned to send around 150 Indian Army troops, 45 Indian Air Force personnel and a number of Navy officers for the exercise. In June 2020, a tri-services contingent from India took part at the Victory Day Parade at the iconic Red Square in Moscow to commemorate the 75th anniversary of the Soviet victory over Nazi Germany in the Second World War. A contingent from China had also attended it.

But India has reviewed its earlier decision now. It may not participate in the exercise.

Also Read: U.S. ncairways.co/russia/

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Eight Airlines Still Seek Government Aid to Stay Afloat in Aviation [Flickr]

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Eight airlines - Bangkok Airways, Nok Air, Thai AirAsia, Thai AirAsiaX, Thai Lion Air, THAI Smile Airways and Thai Vietjet- approached the government and requested it to do something for them so that they could remain afloat in the aviation business for at least one more year.

The government seemed to be worried about the airlines regarding liquidity to maintain the employment of their employees. It appeared to be satisfied with the airlines' endeavours - that the airlines did respond to the government’s request to retain their 20,000+ workers through the COVID crisis, despite the fact that their business is limited by travel restrictions and a near-total ban on foreign tourists.

Also Read: Debt in the Airlines Set to Ruin Industry Prospects

Thai AirAsia chairman Tassapon Bijleveld said that the chief expectations of the airlines from the government have been :

allocation of soft loans,
an extension of the excise tax cut for jet fuel and
reduction of airline operation fees such as parking and landing charges.

Prime Minister Prayut Chan-o-cha has pledged to offer 24 billion baht in soft loans to such airlines by October 2020 during the meeting with the airline representatives.

Such a development further endorses the basic fact that the airline industry is not yet out of its troubles. It still has to plead for tax-payers' money to keep it in business. ncairways.co/eight-airlines/

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Cummins India Shows Irresistible Accumulative Swing Index [Flickr]

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Cummins: Price breakout from the falling supply line, last three month’s base formations augurs well for next up move

The capital goods space is witnessing fresh momentum after the last three month’s base formation and is expected to witness a catch up with the rest of the market.

Cummins India Ltd., a Mid Cap company, was incorporated in the year 1962. It has a market cap of Rs 12677.74 crores and is operating in Engineering sector. The company, a producer of diesel and natural gas engines, generator sets and their related services operates through two main segments: Engines and Lubes.

In January 2020, its share price fell over 2 per cent. A research house Nomura has downgraded the stock to reduce from neutral and cut target to Rs 570 from Rs 585 per share. Today a consolidation is being witnessed.

o The share price of Cummins India has generated a breakout above the lastthree month’s higher base formation (Rs 311-439). In the process, it has also closed above the falling supply line joining highs since May 2019 (Rs 801) signalling a reversal of the corrective trend and resumption of the fresh up move, thus offers fresh entry opportunity with a favourable risk-reward set up

o Structurally, the stock in the last three months of base formation has constantly been forming higher lows as can be seen in the adjacent chart highlighting the positive price structure. ncairways.co/cummins/

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Britannia Industries Continues its Outperformance [Flickr]

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The stock, Britannia Industries (BRIIND), remains a major outperformer within FMCG space and is currently poised to resume its structural uptrend after the four-week breather, thereby offering fresh entry opportunity.
Such a bullish stance on Britannia Industries is anchored on the following observations :

Since March 2020 panic lows of Rs 2100, price rallies are stronger while corrections have remained shallow underscoring strong appetite to own the stock and robust price structure
Over Past four weeks stock retraced is preceding five-week rally (Rs 3305 – 4010) only by 38.2%, signifying elevated buying demand
The share price has consistently garnered buying support at a rising 10-week average in each correction since March 2020.
This rhythm is expected to be maintained and stock to rally higher from current levels

Analysts expect a significant demand zone is now placed ~3570 which is 61.8% retracement of June-July rally, which is expected to be held. ncairways.co/britannia-industries/

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EasyJet Establishes Severity Terms for Voluntary Redundancy [Flickr]

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EasyJet pilots have been offered alternative contracts. The airline also warns of upcoming cuts.

In Q3 of last year, budget carrier EasyJet served 26.4m fliers and earned £1.76bn as revenue. One year later, the story became entirely different. EasyJet flew just 117,00 passengers and could earn revenue of only £7m as it could not utilise its resources.

The EasyJet (LSE: EZJ) share price has crashed this year. The stock has fallen 65% from its 52-week high of 1,500p witnessed at the end of February.

The coronavirus crisis has hit the airline sector like a storm. Several air carriers were forced to ground their planes as travel restrictions were imposed around the world.

Following the grounding of its fleet, EasyJet had to deal with the nightmare scenario of having no income and persistent expenditures. Additionally, it also has a number of other liabilities.

The dire financial predicament of the discount airline EasyJet has forced the company to consider strange steps for its survival.

EasyJet shall extend its pilots “seasonal” contracts. That is, work for 26 weeks continuously, and do not draw any salary for the rest of the year.

EasyJet has over 2200 pilots. As the global airline companies battle the collapse in the air travel business, EasyJet may terminate a third of its pilot workforce in an attempt to make severe cuts in its expenditures. ncairways.co/easyjet/

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