Business News Live (November 18) updates: Govt pushes back on key RBI proposals fearing hit to credit growth

The Indian government is pushing back on two key proposals of the central bank, which will require banks to set aside more funds for infrastructure projects and hold more liquid assets against online deposits, according to a government source.

Large parts of Asia's third-largest economy rely on bank financing with lenders' credit growing at nearly 14% over the past year.

The Reserve Bank of India (RBI) in May proposed banks set aside 5% of the loans given to infrastructure projects that are under construction, pushing banks to approach the government on concerns over a rise in the cost of funding such projects.

• Quick commerce platform Zepto on Monday said announced the rollout of its cafe service in major cities and said it targets a revenue run-rate of Rs 1,000 crore by 2026.
• It will serve through over 120 Cafes at stores across Mumbai, Delhi, Bengaluru, and soon in Hyderabad, Chennai, and Pune, a company statement said.
• "We have cracked 10-minute delivery with high-quality food preparation processes, which is why we are seeing strong customer love. Over the past year, our team has meticulously researched and sourced state-of-the-art equipment for our cafes, including coffee machines that employ handcrafted brewing techniques," Zepto CEO Aadit Palicha said. (PTI)

• Nvidia has bested lofty Wall Street revenue expectations for the past eight quarters. But as analysts expect a slower pace of growth, how the company overcomes delays and supply chain issues to sell its latest AI chips is likely to be a barometer for its stock price.
• The chipmaker, which is at the heart of the generative artificial intelligence boom, is expected to report that its third-quarter sales surged 82.8% to $33.13 billion, according to data compiled by LSEG. (Reuters)

• Chinese electronics maker Xiaomi Corp posted a 30.5% jump in third-quarter revenue as consumers clamoured for its first electric vehicle, the SU7 sedan.
• Xiaomi launched the car, which draws styling cues from Porsche, in March, entering a crowded China EV market with an attention-grabbing price tag - under $30,000 for the base model, $4,000 cheaper than the base model of Tesla's Model 3 in China.
• It raised its sales target on Monday and is now aiming for sales of 130,000 this year, far more than an initial goal of 76,000. To keep up with demand, Xiaomi has doubled production shifts since June and launched the premium SU7 Ultra model priced at more than $110,000. (Reuters)

• In 2013-14, we saw India at the 10th position, 10th largest economy post that we grew rapidly and by 21-22 we bridge the fifth position. Hopefully in the next few years will be reaching the third position.
• We need to have the digital financial inclusion as one of the very important goals so that cost effective digital means can reach everybody.
• The banking system with cleaner balance and adequate capital buffers and robust earnings are well positioned to finance long term projects
• We find that India's bank credit to GDP ratio stands relatively low at around 58.7% - 2023-24 figures compared to global averages. This underscores a significant opportunity for financial deepening and credit expansion within the economy.
• Banks need to be equipped to deal with the flow of distressed assets and the markets need to be equipped to channel investments into the reconstruction and revival of such assets.
• Supporting the MSMEs through innovation and credit assessment is a very important step.
• Small ticket loans enable entrepreneurship and employment generation
• Banks next year for 2025-26 should target lending of Rs 6.12 lakh crores and Rs 7 lakh crores for 2026-27 to the MSMEs.
• Banks will have to look more on the banking activities, and not burdens customers with insurances, which they don't require.
• There is no cause for undue concern. India's economy remains resilient, underpinned by strong macro economic fundamentals, moderating inflation, a robust external position and continued fiscal consolidation have reinforced confidence among both consumers and businesses

• Embattled green tech player Northvolt has missed some in-house targets and has curtailed production at its battery cells plant in northern Sweden, according to internal company documents and company sources, underscoring the challenge of ramping up output.
• Two unpublished documents reviewed by Reuters, marked "Production plan 2024", show Northvolt has since early September been consistently missing weekly production goals for shippable cells, or cells deemed good enough to be delivered to clients. They include data as recent as the week ending Nov. 10. (Reuters)

NTPC Green Energy Limited reported a remarkable growth in its financial performance, with revenue surging by 1,094.19% and profit after tax (PAT) increasing by 101.32% between the financial years ending March 31, 2023, and March 31, 2024.

The IPO of NTPC Green Energy, a Maharatna enterprise, will be opening tomorrow, Kfin Technolgies is the registrar of the IPO. The IPO can be applied via ASBA or UPI.

CBDT Chairman Ravi Agarwal has expressed confidence that the direct tax collection for the current fiscal year will not only meet, but likely exceed the budget target of Rs 22 lakh crore. He highlighted that trends in direct tax collections are strong, supporting this optimistic outlook. Agarwal also mentioned that a significant number of taxpayers with undeclared foreign assets above a certain threshold have been sent SMS alerts, urging them to come forward. As part of the ongoing effort to onboard taxpayers, he stressed the need for these individuals to file revised returns by December 31. Additionally, Agarwal revealed that over 6,000 suggestions have been received for the review of the Income Tax Act.

The Central Board of Indirect Taxes and Customs (CBIC) has announced an extension for filing the GSTR-3B return for October 2024 for taxpayers in Maharashtra and Jharkhand. The polling for the legislative assembly elections in these states is scheduled for November 20, 2024, which coincides with the due date for filing the GST returns. To accommodate voters, the government, with approval from the GST Implementation Committee (GIC), has decided to extend the filing deadline by one day, from November 20 to November 21, 2024. A formal notification regarding this extension will be issued soon.

• India's central bank will launch a pilot programme in 2025 offering local cloud data storage to financial firms at affordable prices, according to two sources aware of the matter, who declined to be identified as conversations are confidential.
• The Reserve Bank of India's planned cloud platform will use local IT firms, pitting it against the likes of Amazon Web Services, Microsoft Azure, Google Cloud and IBM Cloud, in a first-of-its-kind initiative from a major global central bank.
• The burgeoning cloud services market in Asia's third largest economy was estimated at $8.3 billion in 2023 and is expected to grow to $24.2 billion by 2028, according to a report by International Data Corporation, but it is largely dominated by foreign firms. (Reuters)

• Qualified Institutional Buyers (QIBs) - 0.26 times
• Non Institutional Investors(NIIS) - 0.07 times
• Retail Individual Investors (RIIs) - 1.24 times
• Employee Reserved - 7.70 times
• Total - 0.39 times

The Promoters of this Maharatna company are the President of India, who acts through the Ministry of Power, Government of India and NTPC Limited.

Oyo founder and chief executive officer (CEO) Ritesh Agarwal is set to increase his stake in the hospitality chain with an investment of Rs 550 crore, as the Gurugram-headquartered company eyes global expansion. Agarwal is set to buy more than 12.9 crore shares at Rs 42.60 apiece, taking his stake from 30 percent to 32 percent. The investment values Oyo at close to Rs 32,000 crore, sources said. (Read More)

A key contest is unfolding in Anushakti Nagar, Maharashtra, between two factions of the Nationalist Congress Party (NCP). Fahad Ahmad, representing the Sharad Pawar faction, will face off against Sana Malik, the daughter of former minister and two-time MLA Nawab Malik. Fahad Ahmad, known for his involvement in the anti-CAA and NRC protests, has a background as a student leader at Aligarh Muslim University and the Tata Institute of Social Sciences. Opposing him is Sana Malik, who is fighting to carry forward her father's legacy in the constituency, a seat that Nawab Malik, who won it twice, had previously held and now supports his daughter's bid. (Read More)

• Apple supplier Foxconn has ordered the hiring agents that help recruit iPhone assembly workers in India to remove age, gender and marital criteria as well as the manufacturer's name in job advertisements, according to three people familiar with the matter and almost a dozen ads reviewed by Reuters.
• The moves follow a Reuters investigation published June 25, which found that Foxconn excluded married women from jobs at its main India iPhone assembly plant, though it relaxed the practice during high-production periods.
• Foxconn, which employs thousands of women at the iPhone factory at Sriperumbudur, near Chennai, outsources recruitment of assembly-line workers to third-party vendors. These agents scout for and screen candidates, who ultimately are interviewed and selected by Foxconn. (Reuters)

China's Huawei on Monday announced that it had started taking pre-orders for its Mate 70 smartphone model, in a statement on its official WeChat account. (Reuters)

• Bajaj Broking has given a ‘subscribe for long term’ recommendation for the IPO of Zinka Logistics Solution Ltd. (ZLSL).
• ZLSL is India’s largest digital platform for truck operators by user count, with 963,345 truck operators using its platform in FY24, which accounts for 27.52% of the country’s truck operators.
• In terms of financial performance, the company reported the following for the last three fiscals:
• FY22: Total income of ₹156.13 crore and a net loss of ₹230.35 crore
• FY23: Total income of ₹195.09 crore and a net loss of ₹236.85 crore
• FY24: Total income of ₹316.51 crore and a net loss of ₹166.99 crore
• For Q1 FY25 (ended June 30, 2024), ZLSL posted a net profit of ₹32.38 crore on a total income of ₹98.33 crore, signaling a shift towards profitability. However, it will take some time to eliminate its carried-forward losses.
• Bajaj Broking’s IPO note highlights that while the company is a leading digital platform offering a wide range of services for truck owners, it reported losses up until FY24 but became profitable in Q1 FY25. The IPO appears to be aggressively priced based on annualized earnings for FY25. Investors with surplus funds, who are well-informed and risk-tolerant, may consider allocating moderate funds for the long term.

• Qualified Institutional Buyers (QIBs) - 0.26 times
• Non Institutional Investors(NIIS) - 0.05 times
• Retail Individual Investors (RIIs) - 1.10 times
• Employee Reserved - 6.85 times
• Total - 0.36 times

The public offer of NTPC Green Energy is scheduled to debut on the BSE and NSE on Wednesday, November 27.

The company intends to utilise the funds raised from the public issue to invest in its wholly-owned subsidiary, NTPC Renewable Energy Limited (NREL). Additionally, NTPC Green Energy plans to repay or partially prepay certain outstanding borrowings, with the remainder allocated for general corporate purposes.

NTPC Green Energy Limited, a wholly-owned subsidiary of the state-run NTPC Limited, specializes in renewable energy generation, executing projects through both organic and inorganic approaches.

Honasa Consumer shares plunged 20% to hit their lower circuit during the morning session on November 18 after the parent company of the D2C brand Mamaearth reported a weak earnings performance for the September quarter, marking its first quarterly loss in five quarters. By 9:20 am, the shares had fallen to ₹297.25 on the NSE, dropping below their IPO price of ₹324 per share. (Read More)

The Grey Market Premium (GMP), which reflects investors' readiness to pay a premium for a public issue, has seen a sharp decline for NTPC Green Energy in recent days, dropping to Re 1. As of November 12, the IPO's GMP stood at Rs 9 per share.

IDBI Capital Market Services Limited, HDFC Bank Limited, IIFL Securities Ltd., and Nuvama Wealth Management Limited are serving as the book runners for the public issue, with Kfin Technologies Limited acting as the registrar.

The IPO has allocated a minimum of 75% of the shares for Qualified Institutional Buyers (QIB), a maximum of 15% for Non-Institutional Investors (NII), and a maximum of 10% for retail investors. Additionally, equity shares worth up to Rs 20 crore have been reserved for employees, who will also receive a discount of Rs 5 per equity share.

NTPC Green Energy aims to raise approximately Rs 10,000 crore through its book-built offer, which includes a fresh issue of 92.59 crore shares. The company has set the price band for the public offer between Rs 102 and Rs 108 per equity share, with each share having a face value of Rs 10. The minimum lot size for the offer is 138 shares.

The initial public offering (IPO) of state-owned NTPC Green Energy Limited is set to open for public bidding on Tuesday, November 19, and will close on Friday, November 22. Prior to this, the renewable energy firm will hold its anchor investor round on Monday, November 18.

• Last week, China announced reductions or cancellations of export tax rebates on certain products made from aluminum and copper, as well as refined oil products and batteries. This decision led to a sharp rise in aluminum futures prices on the London market. In India, shares of metal producers like Hindalco, Nalco, and Vedanta are closely monitoring developments related to this move.
• China is a major exporter of aluminum in the form of semi-finished products, a long-standing source of trade tensions with Western economies. These exports, which include a variety of aluminum products such as pipes, plates, sheets, and strips, currently benefit from tax rebates of up to 13%. (Read More)

As per investorgain.com, the last Grey Market Premium (GMP) for the BlackBuck-Zinka Logistics IPO is nil. With a price band of Rs 273, the estimated listing price is Rs 273 (cap price + current GMP), resulting in an expected percentage gain/loss of 0.00% per share.

• Anchor Investment: BlackBuck IPO raised Rs 501.33 crore from anchor investors on November 12.
• Promoter Shareholding:
• Current combined holding: 32.91%.
• Post-issue holding: 27.84%.
• Fund Utilization:
• Cover sales and marketing expenses.
• Invest in its NBFC subsidiary.
• Fund product development costs.
• Support general corporate activities.

• Retail Investors: Minimum investment of 54 shares, costing Rs 14,742.
• Small Non-Institutional Investors (NIIs):
• Minimum 14 lots (756 shares), costing Rs 2,06,388.
• Large Non-Institutional Investors (NIIs):
• Minimum 68 lots (3,672 shares), costing Rs 10,02,456.

The IPO saw a lukewarm response from investors, with subscriptions reaching only 24% on Day 1, largely driven by the Employee segment. On Day 2, overall subscription increased modestly to 32%. The Grey Market Premium (GMP) also remained unimpressive, staying at zero since November 12. Prior to that, from November 9 to 12, the GMP stood at Rs 24, reflecting an 8.8% rise from the upper end of the price band.

• The BlackBuck IPO is a book-built issue totaling Rs 1,114.72 crores. It comprises:
• A fresh issue of 2.01 crore shares, raising Rs 550.00 crores.
• An offer for sale of 2.07 crore shares, amounting to Rs 564.72 crores.

• Face Value: Rs 1 per share.
• Price Band: Rs 259 to Rs 273 per share.
• Lot Size: 54 shares per bid.
• Total Issue Size: 40,832,320 shares, aggregating up to Rs 1,114.72 Crore.
• Employee Discount: Rs 25 per share.
• Shareholding Increase:
• Pre-issue: 156,330,160 shares.Post-issue: 176,476,680 shares.

Zinka Logistics Solutions offers the BlackBuck app, a digital platform designed to enhance operational efficiency for truck operators. The app provides a range of services, including payments, telematics, a freight marketplace, and vehicle financing.

Good morning and welcome to our live coverage of business news. Today we are tracking the subscription trends of Zinka Logistics Solutions and latest buzz around the NTPC Green Energy's mega public offer.