The US economy reported GDP growth at 6.5% for the Jun-21 quarter. This is marginally lower than the original estimate of 6.4%, but stays robust nevertheless. The expansion in GDP is expected to be strong for the remainder of year 2021. Economists have pointed out that the resurgence in COVID-19 infections driven by Delta variant could pose a risk to the US economy. However, currently the US economy appears to be reaping benefits of Biden’s $1.9 trillion pandemic relief and aggressive vaccinations across the US.
Panatone Finvest, a subsidiary of Tata Sons, signed a deal to acquire 43.3% stake in telecom equipment maker, Tejas Networks, for Rs.1,850 crore. Panatone is the arm that originally held the VSNL stake. Tejas Networks designs and develops networking products for telecom service providers, ISPs, utilities, defence and government. Tejas will utilise the proceeds from the preferential allotment to expand organically as well as inorganically. Tejas will allot 1.94 crore shares at Rs.258 per share aggregating up to Rs.500 crore.
Tech Mahindra reported 39% increase in net profit at Rs.1,353 crore for the Jun-21 quarter. Revenues were higher by 12% at Rs.10,198 crore. Tech Mahindra committed to continue its focus on delivery excellence as the cornerstone of improving operational and financial metrics. In dollar terms, net profit rose 42.2% to $183 million, while revenues were higher by 14.6% at $1,384 million. Tech Mahindra saw smart growth across all key markets as well as key verticals. Its headcount increased by 5,209 to 126,263.
May 2021 will be a month that Bharti Airtel would prefer to forget. During May, Bharti lost a staggering 46.13 lakh wireless subscribers while Reliance Jio added 35.54 lakh mobile users. Overall, the Indian mobile market shed 62.7 lakh users in May. The Jio subscriber base now stands at 43.12 crore. Vodafone also lost customers to Jio in May-21. Vodafone lost another 42.8 lakh users in May, reducing its tally to just 27.7 crore users. Total India mobile customer base stood at 117.60 crore as of the end of May-21.
Colgate Palmolive India reported 17.7% growth in net profit sat Rs.233 crore for the Jun-21 quarter. For the same quarter, net sales were higher by 12% at Rs.1,158 crore. Both sales and profits were slightly lower compared to street estimates. Like most FMCG companies, Colgate also suffered a 28.3% spike in raw material costs but partially offset it with inventory efficiency gains and selective price hikes. EBITDA for the quarter was still higher by 15% at Rs.350 crore. Gross margins expanded 301 bps on a yoy basis.
Windlas Biotech fixed the price band for its forthcoming IPO at Rs.448-460 per share. The 3-day IPO will open on 04 August and close on 06 August. The IPO will comprise a fresh issue worth Rs.165 crore and an OFS of 51.42 lakh shares adding up to Rs.237 crore taking the total IPO size to Rs.402 crore. The proceeds from the fresh issue will be used to purchase equipment required for capacity expansion of the Dehradun Plant-IV and also for repayment or prepayment of certain borrowings to reduce solvency risk for Windlas.
Nykaa, floated by former Kotak investment banking honcho Falguni Nayyar, is preparing to file for IPO. It could see the start-up valued at around $4 billion. Nykaa looks to have fast-tracked IPO plans after the phenomenal success of Zomato IPO. Nykaa will file the DRHP with SEBI in the next few days. Nykaa plans to sell up to 10% of its equity to raise nearly $400 million. Zomato has soared 75% since listing and now commands a market value of $14 billion. Nykaa was founded in 2012 and was last valued at $1.2 billion.
Indian Metal stocks have been in the midst of a rally since January 2021 and on 29 July, the metal index rallied by 5%. On Nifty, 4 out of the top 5 gainers were metal stocks. This was after a report by Bloomberg projected India’s steel consumption is set records this year. Steel demand is expected to surge 17% to 110 million tons in FY22. Rising power consumption and mining activity, along with higher sales of tractors and passenger vehicles were pushing up demand for steel. Global metals prices have also been on a roll.
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