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NITIN GADKARI

Retail Portion Of NHAI’s InvIT To Witness Surge: Nitin Gadkari

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During early October, InvIT raised Rs 1,430 crore and the issue was oversubscribed around seven times. Nearly 25 per cent of the issue was reserved for retail investors. To pool money from investors and invest in assets in order to provide cash flows over a period of time, infrastructure investment trusts are developed

Union Highways Minister Nitin Gadkari, motivated by the overwhelming retail investor response to the recent Infrastructure Investment Trust (InvIT) from National Highway Authority of India (NHAI), said that the retail portion will surge in new such fund-raising ahead, on 28 October. The investment comprised of issuance of Non-Convertible Debentures (NCDs) worth Rs 1,430 crore.

The minister after listing the second share of the NHAI Infrastructure Investment Trust (InvIT) and Non-Convertible Debenture, addressed a gathering at Bombay Stock Exchange (BSE). During early October, InvIT raised Rs 1,430 crore and the issue was oversubscribed around seven times.

Nearly 25 per cent of the issue was reserved for retail investors, however NHAI did not respond on how many times the retail portion was oversubscribed. It rather said that it had an overwhelming response.

To pool money from investors and invest in assets in order to provide cash flows over a period of time, infrastructure investment trusts are developed. Such instruments work on the lines of mutual funds.

The minister without quoting any numbers said, more investment is required from general public in these InvITs and more specifically in our roads. He assured that NHAI’s roads offer 100 per cent security to investors with best internal rate of return (IRR). Moving ahead will fetch more portion being reserved for retail, he added.

NHAI chairperson Alka Upadhyaya also retreated the minister and said that the upcoming InvITs from the NHAI will help more units being reserved for retail, however she did not quote any number.

While addressing the gathering, Gadkari also said that the as of now InvIT has raised nearly Rs 8,000 crore from foreign and domestic institutional investors. However, the second share was special because 25 per cent of the NCD had been reserved for retail investors.

IPO

Mankind Pharma Files For Rs 5,500 Cr IPO

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The company’s IPO comprises an offer for the sale of 4 crore equity shares by the promoters and existing investors

Drug maker Mankind Pharma on Friday filed its draft red herring prospectus (DRHP) with market regulator Sebi for an initial public offering (IPO). The size of the offer is expected to be Rs 5,500 crore.

The company’s IPO comprises an offer for the sale of 4 crore equity shares by the promoters and existing investors.

The offer for sale comprises up to 1 crore shares by promoter Juneja family, up to 2 crore shares by Capital International, up to 99.65 lakh by Beige, and up to 50,000 equity shares by Link Investment Trust.

In the current arrangement, The ChrysCapital-backed consortium of GIC of Singapore and CPP Investments owns 10 per cent of Mankind, while Capital International owns another 11 per cent stake.

The company has hired JM Morgan, Citi, Jefferies, Axis, IIFL, and Kotak as investment bankers.

FDI

“India a goldmine for investors”: Gadkari

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The minister further said that the government has allowed 100 percent FDI in the road sector and there are huge opportunities in the joint ventures

Union minister for road transport and highways Mr. Nitin Gadkari on Monday invited companies in the US to invest in the India transport infrastructure, renewable energy, EV batteries and hydrogen spaces among others.He was speaking at the 19th Indo-US Economic Summit organized by the Indo-American Chamber of Commerce (IACC) with the theme “75 Years of US India Relations : The New Agenda for the Next 25 years”.Noting that India has a well-developed framework for public private partnership in the highway sector, Mr. Gadkari said: “I sincerely hope more and more investors from the US will come forward and invest in roads and highways in India which is a gold mine for investors.” He also said that private investors can invest in the development of multi modal logistics parks, way side amenities, ropeways and alternative mobility solutions among others. The minister further said that the government has allowed 100 percent FDI in the road sector and there are huge opportunities in the joint ventures.

“We are bringing innovative and investor friendly products like InvIT, to allow retail investors to participate in the funding frive. We are designing the products so that retail investors can get good annual returns which are more than the fixed deposit rates.”Reiterating the government’s commitment to achieve net zero carbon emission by 2070, the minister said that the government is promoting research and development (R&D) in the area of renewable energy. India is ready to welcome investments in technologies which run on biofuels, he added.

Talking on the opportunities in the electric vehicles space, Mr. Gadkari said that US-based companies can collaborate in India’s R&D efforts towards EV batteries, technologies and retrofitting.Further, he also highlighted the incentives given under the national green hydrogen policy and called up companies for manufacturing low-cost electrolyzers and hydrogen fuel cell technologies.The union minister also said that the government’s top priorities include the reduction of logistics to below 10% which currently is in the range of 14-16%.Addressing the inaugural session, Patricia A Lacina, Charge D’ Affaires, US Embassy said that over the past 75 years both India and the US have achieved many great things over the years and now they are poised to achieve more in the next 25 years.Talking of the strong Indo-US relationship, Rohit Kochhar, Regional President, IACC said that the partnership is based on shared values in promotion of global security and stability and economic prosperity through free and fair trade, business and investment.

“Our two great nations collectively contribute a staggering 22% of the world’s GDP. We therefore enjoy a place of great prominence in the global economic landscape and with this we carry a huge responsibility as torch bearers in the post Covid journey of recovery and resurgence.”Dr. Lalit Bhasin, National Executive Vice President, IACC the corporate and policy leaders would deliberate of the key issues identifying opportunities and challenges for promoting, handholding and for scripting a time bound agenda for realising the goal of becoming a developed country by 2047.”We look forward to 2047 and this summit is a humble effort in that direction that we can achieve our goal and possibly stand hand to hand and holding each other in the larger economic global world which we have today,” Dr. Bhasin said.

Dr. Bina Modi, Chairperson, Modi Enterprises was of the view that a new era has begun for the Indo-US relations with the presidency of Joe Biden and the bilateral relationship has further deepened even amid the ongoing geopolitical tensions involving Russia and Ukraine. She further said that India’s aim to become a developed nation will be supported by the US.The annual flagship event is being held on 12-13 September 2022 virtually and the key areas of discussion including defence and aviation, banking and insurance, food & agri business, healthcare, infrastructure, climate change, information technology and emerging unicorns. The summit will have leading speakers and panelists from the Indian and US governments, US Embassy, corporate sectors and think tanks.The speakers in the inaugural session of the 19th Indo-US Economic Summit included Kapil Kaul, National President, IACC, Dr. Vivek Lall, Past Regional President and Mr. Arun Kumar, Regional Vice President, IACC.

nirmala sitharaman 3

India’s Digital Revolution Presents Opportunity For US Investors: FM

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Earlier, The finance minister had promised investors in April that the administration would handle any potential problems, in order to promote foreign investment in the nation.

According to Finance Minister Nirmala Sitharaman, the Indian digital revolution presented investment potential for the United States.

Nirmala Sitharaman said that India’s Open Network for Digital Commerce has revolutionised the industrial and retail industries today at a business conference in New Delhi.

She continued by saying that this provided opportunity for international businesses.

Earlier, The finance minister had promised investors in April that the administration would handle any potential problems, in order to promote foreign investment in the nation. 

In her remarks at a roundtable in San Francisco on “Investing in India’s Digital Revolution,”  the minister recommended ongoing dialogue with investors to better understand and address their issues.

In her speech at the US-India Business Council (USIBC) conference on Wednesday, Finance Minister Nirmala Sitharaman discussed the impact of the rapidly shifting geopolitical landscape worldwide and India’s growing relationship with the United States.

Sitharaman also expressed confidence in the ongoing improvement of relations between the two nations.

piyush goyal getty images

Goyal Calls Upon American Investors

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Goyal pointed out that India is opening up discussions with countries on subjects that were never taken up before such as gender, environment, small and medium enterprises, labour and anti-corruption laws

The Union Minister Piyush Goyal recently stated that India provides the best investment opportunity to investors across the world. and called upon investors in the United States (US) to avail the opportunities. While addressing the US India Strategic Partnership Forum (USISPF), he also said that the golden period of ‘Amrit Kaal’ is the most appropriate time to invest in India. Additionally, he also spoke about India-US relations partnership, which is a ‘Partnership of Trust’, resting on 3Ts, that is, trade, technology and talent.  

In order to expand the trade and increase bilateral business opportunities, Goyal also encouraged US investors to share newer ideas, and suggestions on taking India-US relations to the next level.  He noted that India-US relations are based on strong government-to-government engagement, people-to-people ties, large Indian diaspora, business-to-business relations, increasing bilateral trade, deep engagement in geopolitically relevant vibrant  Quad, Ministerial Dialogue, IPEF and robust trade policy forum. 

Goyal asserted that the two countries can work collectively to promote global security, stability and resilient supply chains and a growing economy. The minister also highlighted that India is a much more open economy now.  Goyal pointed out that India is opening up discussions with countries on subjects that were never taken up before such as gender, environment, small and medium enterprises, labour and anti-corruption laws. 

mutual funds

EazyBee Allows Easy Mutual Fund Investment

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DCB EazyBee is a paperless and user-friendly platform that is accessible via desktop and mobile devices. This means one can invest from anywhere in the world

DCB Bank’s Eazybee helps investors monitor and control their mutual fund investment anytime and anywhere. It makes investing in diverse mutual funds quick and seamless, facilitates automatic payments, and provides the option to invest, redeem or switch instantly, all without visiting the bank branch. DCB EazyBee is a paperless and user-friendly platform that is accessible via desktop and mobile devices. This means one can invest from anywhere in the world.

The online platform comes with several attractive features. These include no registration fees and transaction charges; easy mutual funds selection option to invest in well-known AMCs; access to risk ratings and factsheets of all the funds; online uploading of KYC documents; and facility to download NSDL consolidated account statement, among others.

Besides, investors can add up to five savings accounts including DCB Bank to DCB Eazybee, and invest through these. They will also have access to information on Morningstar rated funds and indicative capital gains on their mutual fund investments.

indian rupee

Domestic Investors Own More Equities Than FPIs In 75 Large Cos: Report

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The promoters of these 75 companies own 44.9 per cent as of June (down from 45.4 per cent in September 2021)

For the first time since 2010, the number of equities owned by domestic investors has exceeded the holdings of foreign funds in 75 large companies in April-June quarter this year, according to a report. The combined holdings in equities by domestic investors (mutual funds and households) have increased by 720 basis points (bps) to 25.6 per cent in June 2022, while those owned by Foreign Portfolio Investors’ (FPIs) declined by 230 bps to 24.8 per cent, according to the data collated by Wall Street brokerage Morgan Stanley.

The June quarter alone saw a near 90 bps rise in domestic ownership, while FPI ownership fell 84 bps in these 75 companies which are the largest in terms of market capitalisation, the brokerage said. FPIs’ ownership in these companies has declined by 232 bps since December 2014, and by 263 bps year-on-year. Promoters’ holdings also declined 20 bps annually, 5 bps sequentially and a steep 326 bps since 2014.

Financial institutions’ holdings in these companies rose 39 bps and 64 bps during the respective periods and declined by 17 bps since 2014. On the other hand, domestic mutual funds saw this rising by 49 bps, 144 bps and 580 bps respectively during the three comparable periods. When it comes to public or retail investors, the same has gone up by 1 bps, 36 bps and 157 bps, respectively.

The promoters of these 75 companies own 44.9 per cent as of June (down from 45.4 per cent in September 2021). While 24.8 per cent is owned by FPIs, domestic mutual funds hold 9.5 per cent (up from 8.2 per cent in September 2021), public 9 per cent (up from 8.5 per cent), financial institutions 7.2 per cent (up from 6.5 per cent) and NRIs & others 4.7 per cent during this period. FPIs’ ownership, after peaking at 26.9 per cent in September 2021, has been steadily falling. In December 2021 it slipped to 26.4 per cent and by March 2022 it dropped to 25.6 per cent before hitting 24.8 per cent in June 2022, the data said.

(PTI)

indian rupee

Investors richer by over Rs 5.77 lakh cr as markets rally

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Driven by the rally in equities, the market capitalisation of BSE-listed firms jumped by Rs 5,77,006.83 crore to stand at Rs 2,40,63,930.50 crore

Equity investors became richer by over Rs 5.77 lakh crore on Tuesday, helped by a rally in the broader market where the BSE benchmark jumped nearly 2 per cent. The BSE Sensex zoomed 934.23 points or 1.81 per cent to settle at 52,532.07. Driven by the rally in equities, the market capitalisation of BSE-listed firms jumped by Rs 5,77,006.83 crore to stand at Rs 2,40,63,930.50 crore.

“Absence of fresh selling triggers in the domestic and global economy along with falling commodity prices relieved the heavily discounted equity market to showcase recovery. The recovery indicates that the current uncertainties of inflation and monetary policy tightening have been factored in,” said Vinod Nair, Head of Research at Geojit Financial Services.

However, with the highly sensitive nature of the current equity market, even the slightest inconvenience can trigger volatility, he added. From the global markets, Asian equities in Hong Kong, Tokyo and Seoul ended with smart gains, while Shanghai settled in the red. European markets were trading in the green in mid-session deals.

The US markets were closed on Monday for a holiday. “Markets extended rebound for the second consecutive session and gained nearly 2 per cent, tracking firm global cues. After an upbeat start, the benchmark moved from strength to strength for most of the day, however marginal selling in the last hour trimmed some gains.

“This move has certainly eased some pressure but sustainability is the key,” said Ajit Mishra, VP – Research, Religare Broking Ltd. From the Sensex pack, Titan, SBI, TCS, HCL Technologies, Dr Reddy’s, Tata Steel, Wipro, Infosys and ITC were the major gainers.

Only Nestle India ended marginally lower. In the broader market, the BSE smallcap gauge rallied 2.99 per cent and the midcap index jumped 2.42 per cent. All the BSE sectoral indices ended with gains, with oil & gas index jumping the most by 5.96 per cent, followed by energy (4.95 per cent), consumer durables (3.93 per cent), metal (3.90 per cent), realty (3.79 per cent) and utilities (3.58 per cent). As many as 2,502 stocks advanced and 831 declined, while 129 remained unchanged.

PTI

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Investors Have No Access To Payments Bank Data: Paytm CEO

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Paytm Payments Bank, which facilitates transactions on mobile commerce platform Paytm, has over 300 million wallets and 60 million bank accounts, according to its website

Investors in India’s Paytm (PAYT.NS) do not have access to customer data of its payments bank, CEO Vijay Shekhar Sharma told Reuters in an interview on Monday, seeking to allay concerns over reports of user data being leaked to Chinese firms.

Paytm is backed by China’s Alibaba Group Holding (9988.HK) and its affiliate Ant Group.

The Reserve Bank of India last week barred Paytm Payments Bank from taking on new customers and ordered a comprehensive audit of its IT systems, citing “material” supervisory concerns observed in the bank, without elaborating further.

Paytm has denied a news report from Bloomberg that said earlier on Monday RBI found Paytm Payments Bank’s servers were sharing information with China-based entities that indirectly own a stake in the firm.

In an interview to Reuters, Sharma said no investor had access to the company’s customer data, and the country’s central bank had raised no concerns related to data storage or access.

“There is no access of any bank customer data to any person, of any nationality … RBI has (in its observations) not mentioned anything in relation to investors,” Sharma said.

Paytm Payments Bank, which facilitates transactions on mobile commerce platform Paytm, has over 300 million wallets and 60 million bank accounts, according to its website. Paytm is one of India’s most popular digital payments service.

Shares of Paytm slumped 13% on Monday after RBI’s move, with Macquarie Research analysts saying they expect a significant impact on Paytm’s brand and customer loyalty. read more

The RBI action is the latest setback for Paytm, which had a flop stock market debut of its $2.5 bln IPO in November. Its shares are down almost 70% from the issue price.

Sharma told Reuters “we are confident” of addressing RBI’s concerns at the earliest. The RBI has ordered a comprehensive audit of Paytm Payment Bank’s IT systems.

In a separate statement, a Paytm spokesperson said its payments bank data resides within the country.

The RBI did not immediately respond to a Reuters request for comment.

(Reuters)

start-up

EPF Rate Plummets To Near All-Time Lows

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Smart investors should consider looking beyond the EPF – and understanding how investing systematically in risk assets over long timeframes can help them create an exponentially higher retirement corpus than the EPF ever could

The EPFO announced the interest rate on deposits for FY ’22 on Saturday – and it came in at a near all-time low of 8.1% – a sharp 40 bps drop from last year’s rate of 8.5%. Incidentally, this is near the all-time low rate of 8% that was announced 44 years ago in FY ’78.

The “low” rate for the fiscal can be attributed to the accommodative stance that the RBI has maintained since the pandemic struck; holding repo rates at an all-time low of 4% for an extended period of time despite burgeoning inflationary concerns and skyrocketing crude oil prices.

Low rates, while great for stimulating consumption by bringing down interest rates, also lower the coupon on interest-bearing securities like Fixed Deposits and Government Schemes.

The EPFO’s official statement was that “in determining the rate of interest, the Central Government shall satisfy itself that there is no overdrawal on the Interest Account as a result of debit thereto of the interest credited to the accounts of members”

Translating that to simple terms; EPFO has a mandate that it won’t ever borrow moneys to pay interest to its investors! That’s a smart rule to be following.

It is also worth noting that despite the steady fall in rates since FY ’19, EPF rates are still far superior that other comparable government schemes – a good 100 bps higher than PPF rates.

This higher return can be attributed to the fact that since 2015, the EPF has been investing a portion of its portfolio into equities – namely, ETF’s and CPSE companies. In the last fiscal, the EPFO’s equity portfolio (which is incidentally almost 3X the size of the entire mutual fund industry at 1.23 lakh crores) returned an impressive 14.6% per annum.

Given that EPF rates are tax free (for now), post tax returns from the EPF are at par with conservative hybrid funds, that maintain a similar asset allocation. These funds have returns between 7-9% on an annualized basis over the past 5 years. That’s quite a feat for a portfolio that is neither very actively managed nor run by “star” fund managers!

The bigger question to ask yourself is: should you be satisfied with a ~PPF+75bps return on your long-term retirement savings that could span anything from 20-30 years? In that sort of timeframe, the return from SIP’s in aggressive equity funds could be significantly higher (albeit not linear). The opportunity cost of not taking risks in such a long-term horizon is too high to ignore. 

Smart investors should consider looking beyond the EPF – and understanding how investing systematically in risk assets over long timeframes can help them create an exponentially higher retirement corpus than the EPF ever could.

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