For the week ended 11th February, 9 out of the 10 most valuable companies by the market on the Nifty lost a combined Rs.103,532 crore. TCS led the fall during the week with RIL being the sole gainer. Among the big value losers, TCS saw a value depletion of Rs.44,037 crore. Among others, HDFC lost Rs.13,773 crore, Hindustan Unilever Rs.11,819 crore, ICICI Bank Rs.9,575 crore, Bajaj Finance Rs.8,988 crore, Infosys Rs.8,387 crore and Bharti Airtel Rs.3,158 crore. Of course, the sole gainer, RIL, recorded marginal gains.
The Central Bureau of Investigation (CBI) has filed police complaint against ABG Shipyards and promoters accusing of defrauding banks worth Rs.22,842 crore. ABG Shipyards has been among the highly indebted companies that had defaulted on payments. ABG owes Rs.7,089 crore to ICICI Bank, Rs.3,634 crore to IDBI Bank, Rs.2,925 crore to SBI, Rs.1,614 crore to BOB, Rs.1,244 crore to PNB and Rs.1,228 crore to IOB. CBI has alleged that there was clear diversion and laundering of funds, used for other than the stated purpose.
The year 2021 saw a total of 140 new fund offerings (NFOs) by Indian mutual funds, collecting Rs.100,000 crore in the process. There was a sharp revival in retail interest in MF NFOs. These include closed-ended funds and also ETFs. Comparatively, in 2020, a total of 81 mutual fund NFOs had collected Rs.53,703 crore from investors. The NFOs were triggered by buoyant markets and the need to fill product gaps due to the recategorization of schemes. Maximum number of NFOs were floated by the index funds, ETFs and FTPs.
TVS Supply Chain Solutions has filed DRHP with SEBI for its proposed Rs.5,000 crore IPO. This will include a fresh issue of Rs.2,000 crore and an OFS for the balance Rs.3,000 crore. Promoters and early investors will offer a total of 5.95 crore shares in the OFS. Out of the fresh issue, Rs.1,166 crore will be used for debt repayment while about Rs.75 crore will be deployed to capitalize its global subsidiaries. The company is present in over 25 countries and has served more than 60 Fortune-500 clients in the previous fiscal year.
Foreign portfolio investors withdrew Rs.14,935 crore from Indian markets in the first two weeks of Feb-22. FPIs have already been net sellers each month since October 2021. The FPI selling included Rs.10,080 crore selling in equities and Rs.4,830 crore in debt. There was a surge in FPI selling after Fed spoke about a series of rate hikes of up to 200 bps to offset 7.5% inflation. Among Asian emerging markets, Thailand, Indonesia and South Korea reported inflows of $1,155 million, $580 million and $477 million respectively.
Laurus Labs rallied 5% to Rs.568 after it secured purchase orders from a major global life sciences company with the supplies to commence from March 2022. The execution of these orders are subject to fulfilment of performance obligations. The stock has already recovered 31% from its Jan-22 lows of Rs.433. The stock has been a consistent underperformer since it peaked at Rs.724 per share in August last year. In Q3, Laurus saw revenues fall by 20% due to the impact of continued stocking related concern in the ARV business.
IL&FS group has confirmed in an affidavit to NCLAT that it will resolve debt of Rs.55,000 crore by March 2022. The new board of IL&FS under the leadership of Uday Kotak has been driving fund raising to repay debts via asset monetisation, restructuring and insolvency proceeding initiatives. IL&FS had outstanding debt of Rs.99,355 when it went bust in October 2018. The milestone of Rs.55,000 crore of debt resolution was to be achieved much earlier but got delayed due to the pandemic. There will still be a big haircut.
TCS buyback of shares worth Rs.18,000 crore was passed by the shareholders via special resolution. This special resolution was passed through postal ballot. Tata Sons and Tata Investments will participate in the buyback deal. The last buyback of Rs.16,000 crore was done in Dec-20. Compared to dividends, buyback of shares are more attractive in effective post-tax terms. Typical buyback candidates in India have been the cash-rich technology driven players in Indian market like Infosys, TCS, Wipro and HCL Technologies.
