News Nook: Oct 21, 2024

Indian Sector Specific News:

A) Indian BFSI:

1) HDFC Bank to Offload Rs 10,000 Crore of Shares in HDB Financial Services IPO

• HDFC Bank will sell shares worth Rs 10,000 crore through an IPO of its subsidiary, HDB Financial Services, with a total issue size of Rs 12,500 crore, including a Rs 2,500 crore fresh issue.
• The IPO is expected by the end of the financial year, subject to market conditions and regulatory approvals.
• HDFC Bank currently holds a 94.64% stake in HDB Financial Services, which will remain a subsidiary post-IPO.
• Source: Business Today

B) Indian IT:

1) Indian IT Sector Recovery Driven by BFSI

• Post-Covid recovery in the Indian IT sector is gaining momentum, led by the BFSI sector.
• Peter Bendor-Samuel of Everest Group highlights that BFSI's rebound is an encouraging sign for the entire IT industry.
• The uptick in discretionary spending, particularly in financial services and North America, signals real growth after the slump.
• Source: Economic Times 

2) LTIMindtree Wins Largest Deal via AI Approach

• LTIMindtree secured its largest deal ever, over $200 million, with a US manufacturer due to its AI-driven services.
• In Q2 FY25, the company's total order intake was $1.3 billion, slightly down from the previous quarter.
• Their large deal pipeline remains strong at over $5 billion, with AI playing a key role in consolidating vendor relationships.
• Source: Economic Times

C) Indian Pharma:

1) Indian Pharma Firms Lag Behind in R&D and Innovation

• Indian pharmaceutical firms are trailing global peers in crucial metrics such as R&D intensity, number of patents, publications, and the proportion of PhD employees.
• Global firms generate 5.6 times more patents and 8.4 times more publications per billion USD revenue compared to Indian firms.
• Dr. Reddy's leads in R&D intensity and PhD employee proportion in India, while Biocon and Sun Pharma also perform strongly in patents and publications.
• India is the 3rd-largest drug producer, contributing 1.72% to the country's GDP.
• Source: Economic Times

2) India's Bioeconomy and Innovation Potential

• India's biotechnology sector is valued at $150 billion, ranking 14th globally due to limited patented products and innovation.
• BIRAC is focusing on nurturing startups and promoting R&D to enhance India's leadership in the biotech industry, which supplies 40% of the world's generic medicines.
• Source: Economic Times

D) Indian Telecommunication:

1) 15th ITU Kaleidoscope Academic Conference Kicks Off in New Delhi

• The 15th ITU Kaleidoscope Academic Conference begins tomorrow in New Delhi, focusing on "Innovation and Digital Transformation for a Sustainable World."
• The three-day event aims to foster collaboration among academia, industry, and government on advancements in 5G, AI, IoT, and quantum communications, highlighting India's role in indigenous technology development.
• Source: newsonair

E) Indian Agriculture:

1) Cabinet Committee Overrides Agriculture Minister's NAFED Appointment

• The Appointments Committee of the Cabinet (ACC), chaired by Prime Minister Narendra Modi, has reassigned the Managing Director of NAFED from an Agriculture Ministry official to Pankaj Kumar Bansal, an official from the Ministry of Cooperation.
• This decision comes a week after Union Agriculture Minister Shivraj Singh Chouhan had designated Muktanand Agrawal as the acting MD, highlighting an unusual move by the ACC to alter the Agriculture Ministry's choice.
• Source: The Indian Express.

F) Indian Energy: 

1) HPCL Plans LNG Terminal Launch by Year-End

• Hindustan Petroleum Corp (HPCL) aims to commission its new 5 million metric ton per year LNG import terminal in Chhara by December or January, following delays caused by weather issues.
• The company is currently in discussions with eight to nine companies for long-term LNG supply to support its refineries and projects.
• Source: Economic Times

Indian Economy and Government Initiatives:

1) Direct Tax Windfall: Burden on India's Middle Class?

• India’s direct tax revenue reached a 24-year high, with collections surging by 182% over the past decade, totaling over Rs 19.60 lakh crore in FY24, heavily reliant on the middle class despite their small population percentage.
• The middle class pays significant taxes while facing high costs for public services, as 70% of tax filers had zero tax liability, raising concerns about the fairness of the tax system.
• Corporate tax revenues are decreasing despite soaring profits, leading to calls for better tax distribution to alleviate the burden on individuals.
• Source: Policy Circle

2) India's Solar Industry: Time to Reduce Chinese Dependence

• India's solar sector, aiming for 500 GW of capacity by 2030, is currently 80% reliant on imports for solar equipment, predominantly from China, raising concerns over energy security.
• Despite measures like a 40% customs duty on Chinese solar modules, the reliance on imported components from other countries still inflates costs for local manufacturers and slows solar adoption.
• Strengthening domestic manufacturing, enhancing international collaborations, and investing in R&D are critical for India to reduce import dependency and achieve its renewable energy goals.
• Source: Policy Circle

3) New Policies to Drive Economic Growth in Andhra Pradesh

• The Confederation of Indian Industry (CII) predicts that new policies in Andhra Pradesh will attract ₹30,000 crore in manufacturing investments and ₹83,000 crore in Foreign Direct Investment, positioning the state among India's top three for investment.
• Key incentives include 10% additional incentives for job creation and 6% for reducing carbon footprints, aiming for a 15% economic growth rate and the establishment of 175 industrial parks to benefit 2.2 million MSME entrepreneurs.
• The introduction of a single-window system for approvals and support for the One District One Product (ODOP) initiative aims to enhance regional development and create substantial employment opportunities.
• Source: The Hans India

Stock Specific News:

• Havells India reported a 16.38% year-over-year revenue growth and a 7.69% profit increase in Q2 2024, but faced a 21.82% revenue decline and a 34.24% profit drop compared to the previous quarter, while maintaining a positive EPS trend and strong long-term stock performance.
• Waaree Energies' IPO, opening on Monday and closing on October 23, aims to raise approximately Rs 4,321 crore through a fresh equity sale of Rs 3,600 crore and an offer for sale of Rs 721 crore, with a current GMP of Rs 1,340, reflecting an 89% premium to the issue price.
• Mahanagar Gas Ltd. (MGL) stock declined by 8.33% on October 18, 2024, amid underperformance in the gas sector and a total loss of 10.87% over the past three days, leading to a bearish sentiment among investors.
• LCC Infotech's stock price surged to an all-time high on October 20, 2024, marking a 556.98% increase over the past year, despite receiving a 'Sell' call from MarketsMojo, and outperforming its sector by 1.82%.

Bonus Briefs:

• Ukrainian Drone Strike: Ukraine conducted a drone attack on a significant Russian explosives factory, the Sverdlov plant, which is known for producing military explosives and has faced international sanctions.
• Russian Response: Russian officials acknowledged the strike but claimed they successfully defended against it, leading to only minor injuries among workers at the factory.
• Verification Issues: Although there is footage of the explosions, its authenticity has not been confirmed, and Ukraine has not provided information on how much damage was caused.
• Escalation of Conflict: In response to the drone strike, Russia shot down numerous Ukrainian drones and targeted civilian areas, resulting in injuries. This indicates an escalation in military hostilities.
• Impact on Civilians: An attack on an energy facility in Sumy caused significant power outages, affecting over 37,000 residents, highlighting the conflict's impact on civilian infrastructure.