Adani Group has prepaid Rs7,374 crore of share-backed financing to domestic and global institutions; 2 years ahead of schedule. The idea is to aggressively cut down on promoter leverage backed by shares. It will release about 15.5 crore shares of Adani Ports, 3.1 crore shares of Adani Enterprises, 3.6 million shares of Adani Transmission and 1.1 crore shares of Adani Green Energy. In the last 30 days, Adani group has repaid nearly $2.11 billion of share-backed financing. It is currently amid major global bond roadshows.
The Defence Ministry signed a deal with Hindustan Aeronautics Limited (HAL) to buy 70 HTT-40 basic trainer aircraft worth Rs6,800 crore for the Indian Air Force (IAF). The Defence Ministry will also procure 3 cadet training ships worth Rs3,100 crore from L&T. The HTT-40, which is 56% indigenized, is a turboprop aircraft with good low speed handling qualities. HAL will engage the domestic private sector and the MSMEs for handling the supply chain. L&T will design its ships indigenously at L&T shipyard in Chennai.
The central government has received Rs50,279 crore of CPSE dividend earnings in FY23; the second year in a row. For FY23, the original budget estimates were Rs40,000 crore, which was later scaled up to Rs43,000 crore. In FY22, total dividend receipts for the government from CPSEs were Rs59,000 crore. In addition, the disinvestment receipts for the year have been Rs31,306 crore against the full year target of Rs50,000 crore. That gap should be filled, either by the sale of HZL stake or Axis Bank stake sale by SUUTI.
According to the Global Trade Research Initiative (GTRI), manufacturing electric vehicles (EVs) in India will increase its dependence on China for raw materials, mineral processing and battery production. China currently processes more than 60% of lithium, 65% of cobalt and 93% of manganese produced globally. It also makes 75% of the batteries produced globally. There is also the cost of recycling the batteries after it completes its 7-year life. India currently generates 50% of electricity from coal, where costs are an issue.
Credit card outstanding in January 2023 rose 29.6% yoy to an all-time high of Rs1.87 trillion. This has been triggered by increased digitisation and rising consumer confidence. Even the growth for the first 10 months is 20% on yoy basis. Ease of digital payments and the rise of other forms of cards has led to this rapid spike in card spends. As of January 2023, there are a total of 8.25 credit cards issued by the major banks in India, led by HDFC Bank, SBI Cards and ICICI Bank. Unsecured loans have been growing rapidly.
The CEO of Tata Realty has confessed that real estate projects were becoming unviable due to high cost of land, capital and construction in India; coupled with economic uncertainties. For instance, in cities like Mumbai, NCR and Bengaluru, the land cost is anywhere between 50% and 85% of the total project cost. Also, the cost of capital varies from 8.5% to 18% and the median rates have gone up in the last one year due to RBI hawkishness. Cost and time overruns are inevitable over a 6-year period for the large projects.
Adani group is now the majority shareholder in NDTV Ltd after Prannoy Roy and Radhika Roy completed the sale of large chunk of their stake to the Adani group. The transfer of 27.26% stake to the Adani group also included a control premium. Now, Adani group owns 64.71% in NDTV. The stake buy happened in 3 phases. In the first phase, Adani got 26% in NDTV by converting warrants in RRPR Holdings. Then the sake was hiked to 37.45% through the SEBI mandated open offer. The latest is the sale by former promoters.
HCL Technologies will double its semiconductor services business over the next 3 years as it is aggressively building capabilities on electronic chip plants to be set by its group firm. HCL has applied under the PLI scheme to manufacture semiconductors in India. HCL Tech expects its wafer-fab to be ready in 24 months. HCL will make chips of 65 nanometre nodes; used in automobiles and consumer durables. It is working with names like Intel, TSMC and Applied Materials in this area. Demand is expected to grow exponentially.
