News Nook: Jan 20, 2025

Indian Sector Specific News:

A) BFSI:

1) IT Companies See Recovery in BFSI and AI Growth

• Major Indian IT firms like Infosys, HCLTech, and Wipro are seeing a recovery in North America and BFSI sectors, leading to upgraded growth forecasts.
• However, the manufacturing sector in Europe remains weak for these companies. 
• Source: ETtech

2) Union Budget 2025: Axis Securities' BFSI Sector Expectations

• Axis Securities expects the Union Budget 2025 to focus on capital expenditure, which could drive corporate credit growth for banks and benefit stocks like SBI, HDFC Bank, and ICICI Bank.
• The budget is also anticipated to support microfinance and insurance sectors, with measures like dedicated funding windows and tax exemptions, which may positively impact companies like SBI Life and HDFC Life. 
• Source: Business Today

3) Thematic Funds Leading to Speculative Bubble: Need for SEBI Intervention

• SEBI's past actions curbed reckless speculation in the F&O market, but another speculative frenzy is emerging in thematic funds, potentially harming retail investors.
• The regulator needs to step in to prevent this unsustainable bubble and protect smaller investors from significant losses. 
• Source: Economic Times

4) SEBI Warns Ola Electric for Violating Corporate Disclosure Practices

• SEBI issued a warning to Ola Electric for announcing its business expansion plans on social media before disclosing the information to stock exchanges, violating regulations requiring timely and equal disclosure to all stakeholders.
• This delay in disclosure could have created an unfair advantage for some investors and undermined market transparency, prompting SEBI to emphasize the need for compliance with disclosure norms. 
• Source: Bar And Bench

5) Sebi's Ketan Parekh Order Brings Dark Pool Platforms Under Scrutiny

• SEBI's investigation into front-running allegations against Ketan Parekh has highlighted the use of unregistered dark pool platforms by foreign portfolio investors (FPIs) in India, raising concerns over transparency.
• These platforms, like Liquidnet and ITG Posit, facilitate large trades but operate in a grey area of SEBI regulations, prompting questions about their regulatory oversight. 
• Source: Moneycontrol

B) Automobile:

1) India's Car Sector Set to Become World’s Largest in Five Years: Nitin Gadkari

• Union Minister Nitin Gadkari announced that India’s car sector, currently valued at Rs 22 lakh crore, will become the world’s largest in five years, highlighting its global competitiveness.
• The sector has created 4.5 crore jobs, significantly contributes to GST revenue, and exports 50% of its manufactured two-wheelers. 
• Source: Manufacturing Today

C) Pharma:

1) Experts Emphasize Critical Need for Strategic Focus on Healthcare in Union Budget 2025

• Healthcare leaders urge increased budget allocations of 2.5% to 3% of GDP, with a focus on infrastructure in Tier 2 and 3 cities, and expanding Public Health Centres (PHCs) and public-private partnerships.
• Advocates call for tax policy changes, such as shifting hospitals to a zero-tax bracket, and encourage investments in AI-driven diagnostics, digital health, and domestic pharmaceutical manufacturing. 
• Source: PharmaBiz

D) FMCG:

1) Reliance Steps Up Distribution Push as FMCG Vertical Grows

• Reliance Consumer Products (RCPL) aims to expand distribution into northern and western India, targeting a reach of 1 million outlets by FY25.
• Key RCPL brands like Campa and Independence are expected to hit Rs 1,000 crore in revenue by FY25, with Campa reaching this milestone within two years of its March 2023 launch. 
• Source: Financial Express

E) Agriculture:

1) Agriculture Processing Industry Seeks Modernization Incentives, Tax Breaks, Export Boosts in Budget

• Industry leaders advocate for subsidies and tax exemptions to modernize the rice milling sector, integrate by-products into ethanol production, and enhance sustainability.
• Calls for increased budgetary support to food processing, nutraceuticals sectors, and a focus on improving cold storage and reducing post-harvest losses, with suggestions for doubling PM-KISAN installments and boosting funding for small farmers. 
• Source: The Print

F) Energy:

1) Reliance Back on Growth Path, Multiple Catalysts to Drive Performance, Say Brokerages

• Brokerages highlight that Reliance is poised for strong growth, driven by key factors such as strategic investments, expanding retail business, and rising demand in telecom.
• The company's performance is expected to improve as multiple business segments contribute to overall growth, positioning Reliance for strong market performance in the coming quarters.
• Source: Economic Times

2) Oil Prices Rise Amid Supply Concerns

• Oil prices increased due to ongoing concerns over supply disruptions from Russian sanctions.
• Geopolitical tensions continue to affect global oil production and pricing.
• Source: Economic Times

3) Adani Energy Solutions Expands Order Book

• Adani Energy Solutions secured two major transmission projects in Rajasthan, raising its order book to Rs 54,700 crore, three times higher than at the start of FY25.
• The company’s market share in TBCB orders grew from 17% to 24%, and it added over 1,000 circuit kilometers to its network in Q3 FY25.
• Source: Economic Times

G) Infrastructure:

1) Cement Stocks Set for Growth with Budget 2025

• The Union Budget 2025-26 is expected to boost the cement sector by increasing infrastructure and road development spending, aiding growth after a slow 2024.
• Cement stocks like UltraTech, Ambuja, and ACC could benefit from these measures, especially after a year of mixed performance due to various challenges.
• Source: Moneycontrol

2) CREDAI to Aid in Developing MSRTC Land

• Maharashtra Transport Minister Pratap Sarnaik called for CREDAI's involvement in developing 1,360 hectares of MSRTC land for infrastructure and sustainable projects, including bus stations, solar panels, and hospitals.
• Developers will also have the opportunity to use leftover land for commercial projects, offering real estate sector growth. A comprehensive policy will be released soon.
• Source: Free Press Journal

Indian Economy and Government Initiatives:

• India's fiscal deficit reduced from 9.2% in FY21 to 5.6% in FY24, with a target of 4.9% this fiscal year. However, due to a sluggish economy, a balanced approach will be required for further reduction.
• The central government’s debt is at 56.9% of GDP, and combined with state debt, it exceeds 80%, which is higher than the target of 60% for fiscal responsibility.
• Economic policy, digital transformation, and inclusive growth will be the main topics at the World Economic Forum (WEF), according to Ashwini Vaishnaw. Discussions at WEF will focus on India’s role in shaping these key areas globally.
• Unemployment is a key concern for India, with slow growth and challenges in creating quality jobs for its youth, risking a demographic disaster. Finance Minister Nirmala Sitharaman is expected to prioritize job creation, skill development, and infrastructure investment in Budget 2025 to address these issues.

Indian Stock Market Update:

• The Sensex rose by 454 points, closing at 77,073.44, and the Nifty gained 141 points, reaching 23,344.75, driven by strength in power, telecom, and financial sectors.
• Kotak Mahindra Bank and Wipro were major gainers, while SBI Life Insurance and Shriram Finance saw notable losses. Most sectors, except auto and FMCG, closed higher.