Corporate India plans bigger capex push in 2022-23
India Inc is planning to boost investment in 2022-23 as consumer demand increases, according to a survey of 19 chief executives. More than half the 19 CEOs planned to increase investment by over 25 percent this financial year over 2021-22, while only 10.5 percent said they would invest less.
Why it’s important: Consumer demand seems to be increasing after two years of pandemic slowdown. The Reserve Bank has said investment was likely to gain traction with improving business confidence, a pickup in bank credit, and support from the government’s capital expenditure on roads.
Adani leads race to acquire cement makers ACC, Ambuja
The Adani group has emerged as the frontrunner to purchase the two cement assets of Holcim in India, ACC and Ambuja, by ensuring funding of around $7-8 billion. Global banks Barclays and Deutsche are leading the financing along with Standard Chartered Bank. Domestic banks ICICI and Axis are still evaluating if they can join the consortium
Why it’s important: A successful sale of the two cement makers by Holcim will make it one of the biggest deals in India. The acquirer will dominate market share in many regions of India.
Indian equities rebound as global markets stabilise, volatility to remain
Indian stock indices rose 1.4 percent, snapping a two-day shedding run. The jump was led by gains in power, automobile, and banking stocks. The 50-share Nifty ended at 17,200 points, or 1.46 percent. The benchmark Sensex rose 1.37 percent to 57,356.61 points. The indices had fallen 2 percent in the past two sessions.
Why it’s important: Gains in most global markets helped the indices rise but analysts said market volatility will remain in the near term.
Government sets price band for LIC IPO at Rs 902-949
The central government has set the price band for the initial share sale of state-run Life Insurance Corporation of India at Rs 902-949 a share, with a Rs 60 discount for policyholders and Rs 45 for employees. The government expects to raise about Rs 210 billion at the upper end of the price band in what would be India’s largest IPO. The IPO will open for subscription to the public from May 4-9, with allotment to anchor investors on May 2.
Why it’s important: The stake sale in LIC is still lower than the minimum 5 percent initially planned. Geopolitical tensions, soaring crude oil prices and monetary tightening have made investors skittish, cramping demand for LIC’s shares.
Wipro buys SAP consulting firm Rizing for $540 million
Wipro has agreed to acquire Rizing Intermediate Holdings, a global SAP consulting firm, for $540 million, to bolster its SAP cloud practice and help clients transform their businesses into intelligent enterprises. The acquisition is subject to regulatory approvals and is expected to close before 30 June.
Why it’s important: Rizing is the latest in a series of acquisitions by Wipro, underscoring the firm’s ambitious growth agenda. It gives Wipro an edge over cloud consulting services.
Auditors made accountable for new reporting norms
Auditors will have to seek direct confirmation on borrowed funds from all entities involved in transactions, including the ultimate beneficiary, to ensure compliance with anti-money laundering laws and foreign exchange rules under new reporting requirements for firms by the Institute of Chartered Accountants of India.
Why it’s important: The guidelines align with new reporting norms notified by the corporate affairs ministry in 2021, which mandate significant additional disclosures in the statutory financial statements of all companies.
L&T Infotech and Mindtree may okay merger next week
The boards of Larsen & Toubro Infotech and Mindtree are expected to meet in the first week of May to finalise the terms of their merger. Mindtree chief executive Debashis Chatterjee is expected to be the chief executive and managing director of the merged entity.
Why it’s important: L&T Infotech acquired Mindtree in 2019. The combined firm will edge past Tech Mahindra to become the fifth-largest IT services provider by market cap, giving it scale to target bigger orders and seek takeover opportunities.
High crude oil prices may drag down India’s growth
High crude oil prices, which is a fallout of the Ukraine war, will weigh on India’s economic growth prospects, increase its current account deficit and push up inflation, the International Monetary Fund has predicted.
Why it’s important: The IMF has estimated India’s growth at 8.2 percent in 2022-23, down 0.8 percentage points from its January forecast because of geopolitical tensions and pandemic-induced slowdown in China. It has recommended monetary tightening to control inflationary expectations.
Google tightens privacy rules for app makers
Tech giant Google has launched a privacy feature on its Play Store that will require developers to give people more information about how apps collect, share and secure user data. Users will start seeing a data safety section in Google Play from Tuesday, and developers are required to complete this section for their apps by July 20.
Why it’s important: As app developers update their functionality or change their data handling practices, they will show the latest in the apps´ data safety section. This will partly assuage privacy concerns that are increasing across the world.
Small towns overtake big cities in electric two-wheeler sales
In the country’s biggest electric two-wheeler buying states, towns with less than a million people accounted for most of the sales: 56 percent in Maharashtra, 75 percent in Karnataka, and 78 percent in Tamil Nadu, according to a report by the Council of Energy, Environment and Water.Why it’s important: As electric two-wheelers don't require sophisticated charging infrastructure, small towns may be well-placed to lead the transition in India.