CMIE has projected that the lockdown in April 2021 could have negatively impacted close to 7.5 million jobs in India taking the unemployment levels to a 4-month high of 7.97%. Mahesh Vyas of CMIE stated that this trend could get amplified. Urban unemployment touched 9.78% while rural unemployment touched 7.13% in April. In the second wave of the pandemic, only essential services have been permitted. However, the situation is not as bad as early last year when the unemployment had touched 24% levels.
There are 2 major IPOs coming up shortly as per the DRHP filed with SEBI. India Pesticides, a specialty agrochemical play, and Krishna Institute of Medical Sciences or KIMS have got SEBI approval for their IPOs. India Pesticides IPO will include a fresh issuance of Rs.100 crore and an offer for sale of Rs.700 crore as per DRHP. The issue proceeds will be used to fund working capital. KIMS will make a fresh issue of Rs.200 crore and offer 21.34 million shares as part of OFS. The proceeds will be used to repay company debt.
Chemplast Sanmar, a company that delisted in 2012, has filed with SEBI for a Rs.3,500 crore IPO. This will include a fresh issue of Rs.1,500 crore and an OFS of Rs.2,000 crore. Sanmar Holdings will offer shares worth Rs.1,850 crore in the OFS, while Sanmar Engineering will offer shares worth Rs.150 crore. Chennai based Chemplast Sanmar, a specialty chemicals company, will use the proceeds of the IPO for early redemption of its NCDs. Apart from reducing cost of debt, it will increase solvency, ISCR and DSCR ratios.
Kotak Mahindra Bank on Monday reported 36% higher net profit of Rs.2,589 crore for the Mar-21 quarter. The company witnessed 7.9% growth in net interest income or NII even though the net interest margins or NIMs fell from 4.72% to 4.39%. In terms of top line, the retail and wholesale banking revenues were tepid while treasury income was a tad higher. But, the big growth to the top line came from life insurance. The bank saw a sharp rise in gross NPAs by over 100 bps on a yoy basis at 3.25%. Net NPAs were at 1.21%.
Sugar stocks soared with most players like Dwarikesh Sugars, Dhampur, Avadh Sugars, Uttam Sugar and Dalmia Bharat gaining 15-20% on 03-May. Sugar is poised to benefit from a mix of global and domestic factors. While supplies from traditional leaders like Brazil and Thailand have been tepid, export subsidies by the Indian government have also boosted exports. But the big change is that the government is pulling back its commitment to 20% ethanol blending in petrol. Summer demand pushed up sugar prices by 8%.
Power Grid INVIT IPO was subscribed 4.83 times by the end of trading on 03 May. The INVIT IPO closed for subscription on Monday. Against the issue size of 425.43 million shares, the INVIT IPO received bids to the tune of 2,050 million shares. At the upper price band of Rs.100, the INVIT has received bids to the tune of Rs.20,547 crore. While the QIB portion got subscribed 4.63 times, the HNI portion was subscribed 5.07 times. The INVIT IPO is the first big test case for monetization of infrastructure assets of the state.
L&T Technology Services reported net profits of Rs.195 crore for the Mar-21 quarter, representing a 5% fall on a yoy basis. Revenues were marginally higher at Rs.1,441 crore. LTTS witnessed 3.9% growth in dollar revenues in the quarter on sequential basis. LTTS posted EBIT of Rs.239 crore giving an EBIT margin of 16.6%, compared to 15.2% in the Dec-20 quarter. Revenues from digital business stood at 52% of total revenues. For the full year, LTTS generated free cash flows of Rs.1,252 crore; the highest in its history.
At the AGM of Berkshire Hathaway over the weekend, Warren Buffett hinted that Greg Abel would take over as the next head of Berkshire Hathaway after he and Charlie Munger decided to call it a day. That more or less settles the succession issue at Berkshire. Indian born Ajit Jain was also in the fray but at 70 he may not be the best choice. Abel has had a longer stint managing the non-insurance businesses of Berkshire group. Buffett is 91 and Munger is 97 and they are surely not get any younger by the day.