Adani Enterprises is currently mulling sale of 44% stake in Adani Wilmar. Adani Wilmar is a joint venture between Adani Enterprises and Wilmar of Singapore and was listed on the stock exchanges only last year. This will also free up capital for the core businesses. The stake sale would be worth around $2.7 billion. However, Adani plans to retain his stake held in personal capacity. The stock of Adani Wilmar has fallen about 36% in this calendar year and is overall valued at around $6.2 billion. It is a trading cum FMCG play.
Tata Power will invest Rs13,000 crore in the state of Maharashtra for pumped hydro storage project (PSP). These 2 PSPs of 1,800 MW and 1,000 MW will be set up at Shirawta near Pune and Bhivpuri in Raigad district. In a PSP, the water is pumped from a lower reservoir to a higher reservoir during times of excess energy and the same water is used to power turbines located lower down to generate power in times of peak demand. Tata Power has been operating hydel projects in Maharashtra for more than 100 years.
The June quarter saw a fall in domestic share in equity market volumes. This includes the share of retail, DIIs and HNIs. This comes after 6 consecutive quarters of rise in share of domestic players. This is largely on account of profit by domestic investors in the quarter as well as the return of FPIs in a big way into Indian markets. Between September 2022 and March 2023, the domestic share went up from 22.40% to 25.73% but has since fallen to 25.50% in June 2023 quarter. DII net inflows were just Rs3,368 in Q1FY24.
SEBI is likely to put in place a mechanism for reversing erroneous off-market transfer of shares. SEBI had asked the depositories to put in place an OTP facility to authenticate one-time off-market transfers but it had practical difficulties in reversals, so SEBI is working out an alternate mechanism. SEBI may look at an inter-depository committee for handling such erroneous transfers. The committee will deliberate on such requests and approve reversal of such erroneous transfers. Verification of beneficiary is one more check.
Investors in India have made big bets on passive funds with the AUM of such passive funds up 8.5X in the last 5 years. Incidentally, nearly 60% of large cap AUM is now in passive funds. That is growth at a CAGR of 54% over the last 5 years in terms of passive fund AUM. The passive AUM has grown from Rs83,000 crore in FY18 to Rs700,000 crore in FY23. Market share of passive AUM is 17% of overall MF AUM. In the last one year, 80 out of 100 passive schemes with a history of over 1 year have given more than 10% yield.
Indian banks in Q1FY24 reported a sharp spike in treasury income on the back of a spike in bond returns during the quarter. SBI had reported profit on investments to the tune of Rs3,847 crore in the quarter, which is twice of the last year quarter. Others like HDFC Bank and Bank of Baroda also reported a sharp turnaround from treasury losses to treasury profits on yoy basis. With the bond yields falling from a high of 7.46% to below 7% after the RBI announced a pause on rates, most treasury profits came in that phase.
Svatantara Microfin, run by Ananya Birla, will pay Rs1,479 crore to buy Sachin Bansal’s Chaitanya India. Post the completion of the deal, Svatantara Microfin will become the second largest microfinance player in India with a reach of 3.6 million active customers. Svatantara is a platform to empower women with funds for their business needs. The combined entity will also have an AUM of Rs12,409 crore, after growth of nearly 6X in last 4 years. Svatantara remains a digital first business. JM Financial advised on the deal.
Adani Ports reported 82.6% jump in net profits in the June quarter at Rs2,115 core on higher volume tariffs. This is the strongest profit performance ever posted by Adani Ports. Total revenues were up 23.5% at Rs6,248 crore. EBITDA for the quarter also grew by 80.2% on yoy basis with cargo volume growth of 12% and container volume growth of 15%. Port cargo volumes were at an all-time record level of 101.4 MMT in the June quarter. Both Mundra and Krishnapatnam ports saw a sharp spike in volumes in Q1FY24.