With divestments likely to go slow in this fiscal, the government is now planning to monetise assets worth Rs75,220 crore in the coal mining sector in FY23. The coal blocks will monetize Rs52,200 crore, while Rs20,320 crore will be monetized through the MDO (mine developer and operator) model. In FY22, total revenues from coal monetization was Rs40,090 crore, which included Rs28,986 crore from coal blocks and Rs9,593 crore from MDO model. Total of 39 coal blocks are likely to be taken up for monetization in FY23.
According to the HDFC Chairman, Deepak Parekh, demand for home loans is expected to double to $600 billion (Rs46 trillion) over the next five years. This would coincide with India transforming into a $5 trillion economy. However, despite this expansion, the mortgage penetration would remain relatively low at 13% of GDP in India. The normal mortgage to GDP ratio is closer to 30% in Asia. Parekh expressed high level of confidence that the HDFC Ltd and HDFC Bank merger would act as a catalyst to mortgage growth in India.
The World Bank has further trimmed India’s GDP growth forecast for FY23 to 7.5%. In April 2022, World Bank had trimmed its forecast by 70 bps from 8.7% to 8%. Now another 50 bps has been cut. World Bank has pointed to key headwinds like rising inflation, supply chain disruptions and geopolitical tensions offsetting the broad recovery in the services sector. Manufacturing is likely to be hit, especially by the supply chain constraints. For FY24, the World Bank has further trimmed its GDP growth projection to 7.1%.
Southwest Monsoon progress may not be as impressive as it originally manifested. In the first seven days since the monsoon first hit the coast of Kerala, the rainfall has been 37% below normal, getting just 14.5 MM of rain against the normal 23.1 MM. These figures were confirmed by the IMD. In places where rains have arrived, Kerala has been 48% below normal but Tamil Nadu was 21% above the normal levels. Parts of North East received twice the average rain. Skymet had warned of below average rainfall in June 2022.
PB Fintech, which owns and operates Policybazaar and Paisabazaar, saw its stock plunge 10% to Rs595 on Tuesday after CEO (Yashish Dahiya) disclosed plans to sell 37.7 lakh shares of the company in open market. This was disclosed by the company in an exchange filing. He currently holds about 190 lakh shares, so this would be about a fifth of his holdings. Markets are jittery because in February 2022, co-founder Bansal had sold 28.5 lakh shares at Rs825 and the stock had fallen vertically after that. It is below its IPO price.
MRPL and Chennai Petro rallied 19-20% and hit their 52-week highs on Tuesday amid high volumes. That was the highlight of an otherwise dull day. Meanwhile, the Singapore gross refining margin (GRM) has risen to a record level of $25.2/bbl, which bodes well for oil refiners. In the last 3 months CPCL is up more than 3-fold. MPRL and Chennai Petro are downstream oil companies. MRPL is 71.6% owned by ONGC. The product cracks of transport fuels are trading at multi-quarter highs boosting the GRMs to record levels.
According to power minister RK Singh, coal stock scenario in India was improving with imported coal now flowing in. The government had ordered importing coal on priority basis to improve the coal stocks with the power plants. Between April and June, due to lower output by Coal India Ltd, the reserve stocks of domestic coal fell from 24 million tonne to 18.5 MT, leading to the coal crisis. Now that has been partially addressed by coal imports. Energy demand has gone up from 3.5 billion units to 4.5 billion units per day.
Adani Group and a unit of Flipkart are in advanced talks to expand their partnership beyond warehousing and data centres. They may even collaborate in areas like wholesale e-commerce, sourcing of groceries and household goods etc. They are likely to enter into a fresh strategic partnership. This is part of Adani’s strategy to enhance its presence in e-commerce space. This will help Flipkart to compete on a stronger footing against rival wholesalers like Udaan, Amazon and JioMart. The deal was originally signed in April.