1. Vodafone Idea’s Belt-Tightening is Helpful, but Far From Good Enough
When expectations aren’t running very high, room for disappointment is small. Analysts were already expecting Vodafone Idea Ltd to report a massive loss of around ₹5,000 crore for the December quarter, and it turns out that they were prescient. The company reported a loss of ₹5,004.6 crore.
In fact, thanks to operating cost synergies and some belt-tightening, Ebitda (earnings before interest, tax, depreciation and amortization) rose 16.3% sequentially to ₹1,137 crore. Ebitda margin widened by 150 basis points from the September quarter. This should come as a relief to investors, considering that margins were frightfully low at 8.1% in Q2.
But the relief is only marginal. Note that margins of Bharti Airtel Ltd’s India wireless business are nearly double those levels. And as the chart alongside shows, Vodafone Idea’s profit levels are still much lower than peers, notwithstanding the improvement last quarter. To be sure, the majority of the synergy benefits are yet to play out, and things will settle down only by FY21.
(Source: LiveMint)
2. Nifty Rises to 4-Month High Ahead of RBI Policy
Markets climbed to a four-month high on Wednesday, the eve of the Reserve Bank of India’s (RBI) monetary policy statement. The Nifty touched the 11,000-mark for the first time since 1 October 2018, after hitting a record 11,760 on 28 August.
The 50-share index closed at 11,062.45, up 128.10 points or 1.17%, while the Sensex was at 36,975.23, up 358.42 points or 0.98% before briefly touching the 37,000-mark.
Investors are expecting RBI Governor Shaktikanta Das, in his maiden monetary policy review, to change the policy stance to neutral and keep interest rates unchanged. The RBI’s Monetary Policy Committee, or MPC, began its policy review meeting on Tuesday, just days after the government announced a range of election-year sops in its interim Budget presented on 1 February. General elections are due in April-May.
(Source: LiveMint)
3. Zomato Raises Rs 284 Cr from Uber, Airbnb Investor Glade Brook Capital
Online restaurant guide and food ordering startup Zomato has raised Rs 284 crore from US-based investor Glade Brook Capital Partners which counts companies such as Uber, Airbnb and Snapchat among its portfolio firms. The financing is part of Zomato’s Series I funding round that started in November 2018 when Alibaba-backed Ant Financial invested Rs 1,539 crore in the New-Delhi based firm. Zomato allotted 13,000 ‘compulsorily convertible cumulative preference shares’ for Rs 2,18,790 per share to Glade Brook to raise the funding, according to regulatory documents filed by Zomato, which were sourced from business signals platform paper.vc.
The funding would help Zomato compete with rivals such as Swiggy, Uber Eats and Ola-owned Foodpanda, which are also betting big on the online food ordering and delivery market in the country.
(Source: Business Standard)
4. Cognizant Names Vodafone’s Brian Humphries as New CEO
Cognizant Technology Solutions Corp named Brian Humphries, currently chief executive of Vodafone Business, as chief executive officer (CEO) succeeding Francisco D’Souza, under whose helm the revenue of the New Jersey-based company surged more than 11-fold to $16.1 billion in 12 years.
The appointment of Humphries is effective from 1 April, after which D’Souza will continue for three months as executive vice chairman.
D’Souza will become non-executive vice chairman on 1 July.
Humphries was chosen over Cognizant’s current president Rajeev Mehta, who will leave the company on April 1. Before joining Vodafone, Humphries, 45, was with Dell for four years and prior to that spent a decade with Hewlett Packard.
(Source: Hindustan Times)
5. RCom Taking Insolvency Route Out of 'Dishonest Intention': Ericsson to SC
In a fresh contempt plea moved before the Supreme Court, Ericsson India has alleged that the insolvency route taken by Anil Ambani-led Reliance Communications (RCom) has "dishonest intention" intended to frustrate the orders of the court, sources close to the development said. The Supreme Court had ordered RCom to pay Rs 550 crore to Ericsson India latest by 15 December.
The purpose of the application filed by RCom to take the company into "voluntary winding up" is to obtain a moratorium, which would prevent it from making any payments to all creditors, including Ericsson, sources said.
RCom had on 1 February sent a notice to the exchanges, stating that it had been unable to find a solution for its debt and hence, would approach the National Company Law Tribunal (NCLT) for initiating insolvency.
(Source: Business Standard)
6. Centre Seeks Around Rs 69,000 Crore in Dividend From RBI in FY20
The government is seeking around Rs 69,000 crore in dividend from the Reserve Bank of India (RBI) for the 2019-20 fiscal year, about 83 percent of the combined dividends of Rs 82,911.56 crore that the Centre has budgeted from the RBI, state-owned banks and financial institutions, a senior government official said.
For the Centre’s current fiscal year, the RBI has already paid Rs 40,000 crore in dividend, and the Centre is seeking another Rs 28,000 crore in interim dividend.
“In our revised estimates, we have budgeted for Rs 28,000 crore. It is the RBI board’s decision on what amount they finally transfer,” the official said. The revised 2018-19 estimate from dividends from the RBI, banks and financial institutions is Rs 74,140 crore, compared with budgeted estimates of Rs 54,817 crore.
(Source: Business Standard)
7. Etihad Infuses ₹252 Cr in Jet Through Jet Privilege Ticket Purchase
Etihad Airways has pre-purchased Jet Airways’ tickets worth $35 million (₹252 crore) through its loyalty programme company Jet Privilege, infusing some funds into the airline, said two people aware of the developments.
The tickets will be offered to Jet Privilege members as redemption for their accumulated miles of air travel. Etihad owns 50.1% of Jet Privilege, while the rest is held by Jet. The Abu Dhabi airline owns 24% of Jet.
An Etihad spokesperson said the airline doesn’t comment on “rumours and speculations”.
(Source: The Economic Times)
8. Key Amazon Seller Cloudtail Returns in a New Avatar
Cloudtail, the largest seller on Amazon’s India website that suspended operations about a week ago, is making a comeback on Thursday after restructuring its ownership so that it is no longer a group company of the marketplace.
NR Narayana Murthy’s Catamaran Ventures has increased its stake in Cloudtail’s parent company Prione Business Services to 76 percent from 51 percent earlier, reducing JV partner Amazon Asia’s stake to 24 percent from 49 percent, people aware of the matter said. With this change, Cloudtail ceases to be an Amazon group company and becomes eligible to sell on the marketplace. Cloudtail also has independent plans. It will list on online marketplaces Snapdeal, Indiamart and other sites, and will also have its own website. However, it will not list on Flipkart.
Equity holdings in Appario, the other large seller, will be similarly rejigged to make it eligible to return, the people said.
(Source: The Economic Times)
9. Adani Ports Q3 Profit Jumps 42% YoY to Rs 1,410 Crore, Revenue Up 5% at Rs 2,824 Crore
Adani Ports & SEZ on Wednesday reported a 42 percent year-on-year (YoY) rise in consolidated profit at Rs 1,410 crore for December quarter.
The company had posted Rs 994 crore profit in the year-ago period.
Total operating revenue for the quarter rose 5 percent to Rs 2,824 crore from Rs 2,689 crore in the corresponding quarter last year.
Ebitda inched up 3 percent to Rs 1,843 crore from Rs 1,784 crore in the same quarter last year.
(Source: The Economic Times)
(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)