The Nifty and the Sensex have opened the day with strong gains adding to the gains already made this week.
Former RBI Governor Raghuram Rajan has urged emerging market nations to offer immediate stimulus to protect their long-term growth chances.
Join us as we follow the top business news through the day.
TCS jumps over 5% after share buyback announcement
A major cause behind the rally in the indices.
PTI reports: “Shares of Tata Consultancy Services (TCS) on Thursday jumped over 5 per cent after the company announced a mega-Rs 16,000 crore buyback plan at Rs 3,000 per equity share.
TCS was the top gainer in the Sensex pack in early trade. The stock rose by 5 per cent to Rs 2,875 — its one-year high — on the BSE.
On the NSE, it jumped 5.18 per cent to its 52-week high of Rs 2,877.90.
“TCS impressed with revenue growth of 4.8 per cent quarter-on-quarter. Broad-based growth across geographies and verticals indicates healthy recovery across segments,” said a report by Motilal Oswal Research.
In 2017 and 2018 too, TCS had undertaken buyback offers of similar sizes.
The board of directors of the company has approved a proposal to buyback up to 5,33,33,333 equity shares of the company for an aggregate amount not exceeding Rs 16,000 crore, being 1.42 per cent of the total paid-up equity share capital at Rs 3,000 per equity share, TCS said in a regulatory filing on Wednesday.
The buyback will be conducted via a tender offer route using the stock exchange mechanism, it added.
TCS had on Wednesday reported a 6.87 per cent dip in the September quarter net at Rs 7,504 crore but said the demand has recovered faster than projected and will be sustainable going forward as well.
It had to set aside Rs 1,218 crore as provisions because of the trade secrets lawsuit filed by Epic Systems, if not the net profit would have grown 4.9 per cent to Rs 8,433 crore.
Revenues for the July-September period came at Rs 40,135 crore, up 3 per cent when compared to the year-ago period, and its chief executive and managing director Rajesh Gopinathan said the Rs 40,000 crore-mark was reached one quarter ahead of what was expected at the start of the pandemic and stressed that the company is in the midst of a “sustainable demand recovery“.
It is confident about the demand recovery, which “stands on stronger legs”, but the prevailing economic climate and realities on the health front make it “cautious”, Gopinathan said.
Other IT stocks like HCL Tech, Infosys, Tech Mahindra and Wipro were also trading with up to 4.5 per cent gains.”
PFRDA allows video-based customer identification process for NPS subscribers
Pension Fund Regulatory and Development Authority (PFRDA) on Wednesday said it has allowed video-based customer identification process to further facilitate on-boarding, withdrawals and exit for NPS subscribers.
The regulator has been constantly introducing new methods of subscriber authentication such as OTP/ eSign based onboarding, offline Aadhaar-based on-boarding, third party reliance for KYC, e-nomination, e-exit for eNPS subscribers to make subscriber registration, exit process and processing other service requests seamless and subscriber friendly, according to a release.
While a lot of NPS (National Pension System) services have been moved online, including onboarding of new subscribers and their servicing, the physical presence of NPS subscribers is required at POPs (Points of Presence) for In-Person Verification (IPV) to complete the process of exit and some other allied services.
Online videos, dealer websites playing significant role in auto purchase journey: Google
Interesting observations on consumer behavior in the automobile market.
PTI reports: “A large number of people are turning to digital channels like search engines, online videos and dealer websites for research before making their decisions about buying new and used cars and two-wheelers, a report by Google and Kantar said on Wednesday.
The report titled ‘Auto Gear Shift India 2020’ explored the digital influence on Indian automobile buyers and the opportunities for the industries.
“With the consumer placing a much higher importance on online and digital channels – search engines, online videos and dealers’ websites have become the three most important touch points for the buyers – leaving behind traditional media platforms,” it said.
The report found that online video plays a significant role in the purchase journey of an automobile shopper, allowing buyers to experience cars and two-wheelers from different and unique angles such as vehicle features, design (walk-around interior, features and technology), in-action (vehicle safety tests, VR content, performance videos), reviews and ads (testimonials, third party reviews or comparison tests.
As digital becomes the primary touch point for prospective buyers, automobile brands and dealerships have heightened their online presence to be a part of the consumer’s car-purchasing journey, it added.
“The auto industry is undergoing a digital transformation and many leading brands have already digitised their consumer touch points. With the consumer preferences shifting to digital across categories, we will see more brands find new ways to engage consumers on digital platforms,” Nikhil Bansal, Head of Industry – Auto at Google India, said.
He added that the duration between research and final decision making has become short with easy access to information online.
“This makes it even more important for auto brands to create richer experiences and content that allows buyers to not just get information but also get an immersive brand experience to engage and influence their decision,” he said.
The report is based on a survey of 2,000 respondents covering 17 cities from tier I, II and III cities.”
S&P 500 performance without big tech stocks
Uday Shankar to step down as President of Walt Disney APAC, chairman Star & Disney India
Change of guard at Disney India.
PTI reports: “Global media and entertainment conglomerate The Walt Disney Company on Thursday said Uday Shankar will step down as President of its Asia Pacific (APAC) business and Chairman of Star and Disney India with effect from December 31, 2020.
Shankar has quit to pursue entrepreneurial interests outside the company.
“Shankar will step down as President, The Walt Disney Company APAC, and Chairman, Star and Disney India, effective as of December 31, 2020,” Rebecca Campbell, Chairman of Disney’s Direct-to-Consumer and International segment said in a statement.
The company said that over the next three months, Shankar will work closely with Campbell to identify his successor to ensure a smooth transition.
Since February 2019, Shankar has served as President, The Walt Disney Company APAC, and chairman, Star and Disney India.
Disney’s Direct-to-Consumer and International segment includes the company’s direct-to-consumer streaming businesses including Disney+, Hulu, ESPN+ and Disney+ Hotstar, as well as Disney’s international media operations stretching from Europe to Asia to Latin America.”
‘Need short-term relief to retain long-term growth hopes’
Emerging markets must take urgent relief measures to address distress among households and small firms due to the pandemic and lockdowns, instead of holding off for a stimulus package after the virus is reined in, former Reserve Bank of India governor Raghuram Rajan said on Tuesday.
Speaking at ICRIER’s annual G20 conference, Dr. Rajan said countries such as Mexico, Peru and India have been very badly affected by the pandemic, both in terms of infection rates and the adverse effects on households and firms.
“Many governments have been cautious, and some would argue overly cautious, because they have lower resources for relief, and they fear rating downgrades. For a number of countries, the right thing to do, which is perhaps what the IMF is now saying, is to spend to diminish the damage than to wait to spend hoping that it will increase demand,” Dr. Rajan said, stressing that relief was distinct from stimulus measures that only aim to increase demand.
Sensex soars over 400 points in early trade; IT stocks shine
Yet another great start to the day for stocks.
PTI reports: “Equity benchmark Sensex rallied over 400 points in opening trade on Thursday led by strong buying sentiment in IT and banking stocks amid positive cues from global markets and sustained foreign fund inflow.
The 30-share index was trading 452.15 points or 1.13 per cent higher at 40,331.10, and the NSE Nifty soared 117.50 points or 1 per cent to 11,856.35.
Tata Consultancy Services (TCS) was the top gainer in the Sensex pack, surging over 4 per cent, after the IT major announced a mega-Rs 16,000 crore buyback plan at Rs 3,000 per equity share.
The firm, meanwhile, reported a 6.87 per cent dip in the September quarter net at Rs 7,504 crore but said the demand has recovered faster than projected and will be sustainable going forward as well.
In the Sensex pack, the other stocks that were trading on a positive note include HCL Tech, Infosys, Tech Mahindra, Tata Steel, Bajaj Finserv, IndusInd Bank, Axis Bank and SBI.
On the other hand, ONGC, Asian Paints, Titan, ITC and PowerGrid were among the laggards.
In the previous session, Sensex ended 304.38 points or 0.77 per cent higher at 39,878.95, while Nifty jumped 76.45 points or 0.66 per cent to close at 11,738.85.
Exchange data showed that foreign institutional investors bought equities worth Rs 1,093.81 crore on a net basis on Wednesday.
According to Arjun Mahajan, Head – Institutional Business – at Reliance Securities, while there is still some amount of ambiguity about fiscal stimulus, US President Donald Trump’s remark to sign separate fiscal stimulus created positive sentiments which led US markets to move higher.
Indian market is expected to move in tandem with global markets, he said, adding that better prospects of 2Q earnings and continued hope about domestic fiscal stimulus will provide support to domestic benchmarks.
IT stocks are likely to be in focus after solid 2Q numbers reported by TCS along with announcement of the buyback offer, he added.
Meanwhile, on the global front, bourses in Tokyo and Seoul were trading on a positive note in mid-session deals, while Hong Kong was in the red. Stock exchanges in Shanghai were closed for holidays.
Wall Street indices ended with significant gains in the overnight session.
International oil benchmark Brent crude was trading 0.17 per cent higher at USD 42.06 per barrel.”
HDFC Bank offers loan for care at Apollo
HDFC Bank has tied up with Apollo Hospitals Ltd. to offer its customers unsecured, pre-approved loan of up to ₹40 lakh for medical expenses incurred at the healthcare chain.
‘The Healthy Life Programme’ will be offered exclusively to HDFC Bank customers at Apollo 24/7.
As per the plan, the bank’s customers will have round-the-clock access to an emergency doctor at the hospital at no cost along with benefits such as a choice of payment options and ease of finance for treatment at all Apollo Hospitals.
The initiative was launched digitally by HDFC Bank MD Aditya Puri, and Apollo Hospitals Group chairman, Prathap C. Reddy in the presence of Apollo Hospitals group executive vice-chairperson Shobana Kamineni, and HDFC Bank MD-designate Sashidhar Jagdishan.