QBiz: Maruti Suzuki’s Profit Up 27%; ITR Filing Date Extended
Here are the top business stories of the day.
1. Maruti Suzuki's Profit Up 27% in Q1, But Lower Than Expected
India’s top carmaker Maruti Suzuki posted a lower-than-estimated net profit of Rs 19.75 billion in the June quarter. The bottom line was 27 percent higher than in the year-ago quarter, while analysts had pegged a growth of over 40 percent.
Lower net profit was largely due to a steep fall in other income, which was down 60 percent to Rs 2.7 billion. Higher tax outgo at Rs 9 billion, up 26 percent, also pegged the net profit performance back. Given the miss, the stock ended the day losing 3.7 per cent. On the operating front, however, the company continues to outperform the sector posting strong volume growth.
(Source: Business Standard)
2. Bharti Airtel Posts Rs 9.4-bn Loss in India Operations
Bruised by an intense tariff war in the telecom sector, Bharti Airtel has reported a net loss of Rs 9.4 billion in its India operations during the quarter ended June. The Sunil Bharti Mittal-led firm, set to be dethroned by Vodafone Idea as the country’s largest telecom operator, had reported a net profit of Rs 8.3 billion for India in the same period last year.
However, helped by an exceptional gain of Rs 5.15 billion, the telco has reported a consolidated net profit of Rs 970 million for the June quarter. Without this gain, Airtel would have reported a net loss on a consolidated basis. The exceptional gain relates largely to creation of deferred tax asset in Nigeria.
Total revenues were also down by 8.6 per cent to Rs 200 billion for the June 2018 quarter, compared to Rs 219 billion last year. The net debt of rose to Rs 1.02 trillion at the end of June 30.
(Source: Business Standard)
3. Facebook shares fall by nearly 20%
Facebook Inc. plunged as much as 20 percent Thursday, July 26, after the social media company showed signs of slowing growth following months of scandal and criticism that delivered a suckerpunch to earnings.
The social media goliath’s financial performance had previously seemed immune to fierce critiques of its content policies, its failure to safeguard private data, and its changing rules for advertisers. But on Wednesday Facebook reported sales and user growth numbers for the second quarter that fell short of analysts’ projections, leaving investors reeling.
The company’s shares fell the most in its history as a public company, wiping out more than $120 billion in market value. It marks the largest ever loss of value in one day for a US traded company. The stock was trading at $179.92 at 9:41 a.m. in New York. The company told Wall Street the numbers won’t get any better this year.
(Source: Hindustan Times)
4. Hindalco to Buy Aleris for $2.6 bn
Hindalco Industries has agreed to acquire US-based Aleris Corporation for an enterprise value of $2.58 billion in a move that will help Hindalco become a global leader in aluminium excluding China.
The acquisition will be done through Hindalco’s wholly owned subsidiary, Novelis Inc. The combined entity will have revenue of $21 billion and an employee base of about 40,000.
“The $2.58 billion debt funded deal would be on the books of Novelis and the company would pay $775 million in cash for the equity portion,” said Hindalco Industries chairman Kumar Mangalam Birla, adding that after the acquisition, “we are well placed to serve our customers across geographies in automotive and now the high-end aerospace segments.”
(Source: The Hindu)
5. Deadline for Filing ITR Extended
The government on Thursday, 26 July, extended the last date for filing income tax returns for assessment year 2018-19 by a month to 31 August.
The new income tax return forms were notified early in April and taxpayers (whose accounts are not liable for audit) were allowed to e-file their ITRs till 31 July .
“Upon consideration of the matter, the Central Board of Direct Taxes (CBDT) extends the ‘due date’ for filing of Income Tax Returns from 31 July , 2018 to 31 August, 2018 in respect of the said categories of taxpayers,” a finance ministry statement said.
(Source: Hindustan Times)
6. ITC Net Profit Rises 10%, Revenue Increases 13.5%
ITC Ltd posted a 10 percent increase in net profit in the June quarter as higher taxes on cigarettes outweighed healthy performance by other segments. The cigarette and consumer goods producer recorded a profit of Rs 2,818.68 crore in the three months ended 30 June. Gross sales grew 13.5% on-year to Rs 18,171.66 crore.
The financial performance was however largely in line with market expectations.
Despite healthy performance by almost all segments, ITC’s profits took a hit from an incremental tax burden of 20% on cigarettes post implementation of the goods and services tax, and a drop in profit from its commodities trading business.
(Source: Livemint)
7. Vodafone India, Idea Get Final Govt Nod for Merger
India will soon have a new No. 1 telecom operator with the department of telecommunications (DoT) giving its final approval to a proposed merger of Vodafone India and Idea Cellular. The new merged entity will overtake Bharti Airtel as India’s largest mobile phone operator.
“We have given final approval for the merger as the companies have paid the required dues,” a senior official from the DoT said, requesting anonymity.
The department had on 9 July raised a demand for ₹3,900 crore in cash and ₹3,300 crore in bank guarantees towards one-time spectrum charges to be paid as part of the merger and acquisition guidelines.
(Source: Livemint)
8. TV Viewership in India Up by 12%: BARC
In an era of increased competition from video streaming platforms, total television viewership in the country has gone up by 12% percent from 2016. The number of TV homes has also grown by 7.5 percent from 2016, outpacing the growth of total homes, which rose at 4.5 percent. These are the findings of the Broadcast India 2018 Survey conducted by Broadcast Audience Research Council (BARC) India.
There are currently 298 million homes in India, out of which 197 million have TV sets, providing an opportunity for penetration in an additional 100 million homes. According to the findings, the average time spent by an individual in watching TV per day has gone up by 3 percent to touch 3 hours 44 minutes.
The Hindi-speaking and southern markets witnessed spikes of 12 percent and 10 percent in viewership respectively. Gujarati channels witnessed the highest growth in viewership at 66 percent.
(Source: Livemint)
9. Paytm Buys Land in Noida for New HQ
Digital payments company Paytm has purchased 10 acres in Noida to establish a new headquarters to accommodate its swelling staff, in one of the largest real estate deals by an Indian consumer internet startup in recent times.
Property consultants peg the deal size at Rs 120-150 crore, based on the market price of Rs 12-15 crore an acre at Sector 137 off Noida Expressway, where Paytm has bought the land. Paytm COO, Kiran Vasireddy, confirmed that the company purchased land for a new headquarters without disclosing financial and other details.
Paytm’s new headquarters is expected to accommodate more than 15,000 employees.
(Source: The Economic Times)
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