TCS may have flattered on the top line and disappointed on the bottom line in Q1FY23. However, it looks like TCS will now rely a lot more on the US markets for FY23. Sequentially, UK business was down -3.3% while the EU business was down -0.7%. This is a major worry since TCS gets nearly 30% of its revenues from UK and the EU region. Since clients in Europe were more cautious on tech spending, TCS will look to get that added boost from US markets. Ironically, Accenture saw Europe business grow at over 10% in Q3.
SEBI is likely to pioneer the issuance of regular risk factor disclosures on market trends. This includes any sharp moves in the market to enable investors to make right decisions with insights. This can avoid the
herd mentality, which is normally seen at market extremes. Especially, the regulator wants to caution on the specific risk factors of IPOs, especially after many investors ended up losing a big chunk of money on IPOs like Paytm and LIC. SEBI would make fact based disclosures on markets on a regular and macro basis.
For the week ended on 08th July, 8 of the 10 most valuable listed companies on the NSE by market cap, added Rs181,210 crore in value. In a week when the Nifty gained 2.97%, Hindustan Unilever emerged the top value creator. HUL added Rs50,058 crore in market value while other big value accretions
included ICICI Bank Rs35,957 crore, HDFC Bank, Rs23,940, LIC Rs19,797 crore, SBI Rs19,233 crore and Infosys Rs15,126 crore. Among losers, TCS lost Rs18,771 crore and Reliance Industries Rs11,805 crore this week.
The coming week is likely to be an action packed week in terms of data flows. Of course, the regular macro troika of USDINR, crude prices and FPI flows will continue to influence, In addition, the MOSPI will be announcing the CPI Inflation data and the IIP data on Tuesday. On Wednesday, the US consumer inflation will be put out. India will also the WPI inflation data announced on Thursday. In addition, the trade deficit for June and latest forex reserve position will be out on Friday. And, yes, don’t forget the
Q1FY23 results.
Foreign portfolio investors (FPIs) pulled out nearly Rs4,000 crore from the Indian markets in the first week of July, although it does not look as virulent as the Rs50,300 crore of selling seen in June 2022.
There still appears to be concerns over the appreciation of the dollar and rising US interest rates. One positive feel for the markets is that with the sharp fall in crude prices, domestic inflation should come under control. In the last 9 months since October 2021, the FPIs have sold over $35 billion in equities in Indian markets.
M&M plans to invest in a battery-cell company to meet future electrification needs. M&M has recent raised $250 million from British International Investment (BII) at a valuation of $9.1 billion. It is exploring a partnership with Volkswagen AG to source EV components like batteries and motors, to ensure that the ecosystem is also ready. M&M is planning to get into EV batteries considering growing demand for EVs and disruption of supply chains, pushing automakers to look for greater control over supplies and
costs.
Avenue Supermarts, which owns the marquee D-Mart brand, recorded standalone net profits of Rs680 crore in Q1FY23 rising. That is nearly a 6-fold increase on a yoy basis. PAT margin tripled from 2.3% last year first quarter to 6.9% in Q1FY23. Even on a sequential basis, the net profits were higher by 47%. Total revenues for Q1FY23 were Rs9,807 crore, up nearly 95% on a yoy basis. EBITDA margins expanded from 4.4% to 10.3% yoy. The general merchandise and apparel categories saw solid traction in the first
quarter.
As Elon Musk walks out of the Twitter bid, it is likely to degenerate into a vicious legal battle as Twitter shareholders hold Musk responsible for the value destruction in Twitter. Musk, on the other hand, has put the blame squarely on Twitter management for not disclosing about BOT details. Musk also doubted Twitter’s long-time estimate of 5% spam accounts and pegged the actual span Twitter accounts at closer to 30%. If Musk backs out, Twitter would at least force Musk to pay up the commitment fee of $1 billion.