The forthcoming week will be a very busy one, with prominent developments expected in the global and domestic markets. US and China are expected to sign a partial trade deal on January 15. China's Vice Premier Liu He, is visiting the US on January 13-15 to sign a 'phase one' trade deal. Closer home, the focus will be on the corporate earnings to be released throughout the week, which include heavyweights like HDFC Ltd, Reliance Industries Ltd and Tata Consultancy Services Ltd. Investors might also take cues from the CPI data which will be released today. Let’s look at company specific news you should know before markets open on Monday:
- Edelweiss Capital Ltd: The Chairman of Edelweiss Capital’s parent company Rashesh Shah said the group has no relationship with Capstone Forex, which is being investigated by the Enforcement Directorate for foreign exchange rules violation. In a clarification to the stock exchanges on Sunday, Shah said the allegation of FEMA (Foreign Exchange Management Act) violation is "false" and the company will fully cooperate in the investigation. The ED had recently summoned Shah in connection with the company's dealings with Capstone Forex Pvt Ltd. The chairman also said that he was unable to go in person to the ED and authorized senior representative had attended in person with the requisite information.
- Granules India Ltd: Drug firm Granules India is recalling over 2.3 crore ranitidine tablets, used to treat ulcers of the stomach and intestines, from the US market, the latest report of the US Food and Drug regulator said. According to the Enforcement Report of the USFDA, the company is recalling 23,090,000 Ranitidine tablets USP 150mg, 10,000 count bag on account of "CGMP deviations: Impurity N-nitrosodimethylamine (NDMA) found in API". CGMP refers to the Current Good Manufacturing Practice regulations. The voluntary ongoing recall is a class II recall, it added.
- Yes Bank: The board of private lender Yes Bank met and approved raising of funds of up to Rs10,000cr in one or more tranches through a qualified institutional placement (QIP), or any other private placement of equity or debt, the bank said in a statement to the stock exchanges post market hours Friday. It added that it would not proceed with the offer made by Erwin Singh Braich/SPGP Holdings. However, the bank is favorably considering the offer by Citax and the final decision regarding the allotment will be taken in the next board meeting. In other news, the Mumbai based lender’s independent director and chairman of the audit committee Uttam Prakash Agarwal resigned on Friday citing deteriorating corporate governance standards and compliance failure in the bank. Agarwal was appointed as independent director on November 14, 2018 and his tenure was to end in November 2023.
- Infosys Q3FY20: IT major Infosys reported a 23% yoy rise in net profit for Q3FY20. The company's net profit rose to Rs4,466cr in the third quarter of current fiscal compared to Rs3,610cr in the corresponding quarter of last fiscal. The company reported operating profit of Rs5,064cr during the Oct-Dec quarter of current fiscal, an increase of 4.8% on annual basis from Rs4,830cr in the same quarter last fiscal. The IT firm revised FY20 revenue outlook upwards to 10 to 10.5% in constant currency. The operating margin guidance was maintained in the range of 21 to 23%. Furthermore, an internal audit committee of Infosys Ltd has concluded that whistleblower allegations about financial irregularities at the Bengaluru-based information technology company were substantially without merit.
- Avenue Supermarkets Ltd: The owner of pan Indian retail store chain Dmart on Saturday reported a 53.3% yoy rise in standalone profit at Rs394cr compared to the same quarter last year. Revenue for the quarter rose 23.90% to Rs 6,752cr compared with Rs5,451cr reported for the year-ago period. On a consolidated basis, the supermarket chain's net profit stood at Rs384cr for the third quarter of FY20 as against Rs247cr profit in the corresponding period of the previous year.
- Tata Motors Ltd: On Saturday, Tata Motors reported a 3% decline in global sales, including that of Jaguar Land Rover (JLR), at 97,348 units in December. Global sales of JLR stood at 50,001 units. Jaguar wholesale units for the month were 12,742 vehicles, while Land Rover wholesale stood at 37,259 units.
- Lupin Ltd: On Saturday, drug firm Lupin said it has received two observations from the US health regulator following the inspection of its Nagpur manufacturing facility. A PAI (Prior Approval Inspection) was carried out by the United States Food and Drug Administration (USFDA) at the company's Nagpur oral solid dosage manufacturing facility between January 6-10, 2020, Lupin said in a filing to BSE. The inspection closed with two 483 observations, Lupin said. The USFDA issues observations by means of Form 483 notifying a company's management of objectionable conditions at the facility inspected.
- Cholamandalam Finanance Ltd: The Muruguppa group company said that it would raise Rs400cr tier-II debt from the UK-based CDC Group Plc through unsecured, subordinated, rupee denominated masala bonds. The masala bonds were Cholamandalam Investment and Finance Company's maiden issue which may be listed on the London Stock Exchange in future, the company said in a statement to the stock exchanges post market hours Friday. CDC's investment in CIFCL's masala bonds would support the extension of loans to driver-turned-owners and micro and small enterprises in underserved rural and semi-urban areas.
- Tata Steel Ltd: Tata Steel on Friday said its Netherlands subsidiary has executed agreements for the refinancing of its bank debt and has raised term-loan facilities of 1.75 euro bn from 19 banks. Tata Steel Netherlands Holdings B V (TSNHBV), a 100% subsidiary of Tata Steel Ltd, has raised the long-term fund. The facilities have also been contracted at favorable terms and more efficient pricing, besides extending the maturity profile relative to the existing ones, the Tata group company said in a statement post market hours Friday.
- HCC Ltd: Lenders of Ajit Gulabchand's Hindustan Construction Co. Ltd. (HCC) said they were going to carve out about Rs2,100cr of debt on the construction firm to a third-party-controlled special purpose vehicle, the company said in a statement to the stock exchanges post market hours Friday. Certain arbitration awards and claims will also move to the SPV and will significantly deleverage the company and address its asset-liability mismatch. The tenure of the debt at the SPV will be up to 10 years and repayments from the proceeds of the awards will yield a higher internal rate of return than current yields offered by HCC.
Let us look at the developments which took place on the global front:
US stocks ended lower Friday, after the Dow Jones index briefly topped 29,000 for the first time in history, as slower than expected jobs data dampened investor appetite. The Dow Jones Industrial Average, lost 133.13 points, or 0.5%, to end at 28,823.77, while the S&P 500 index, fell 9.35 points, or 0.3%, to close at 3,265.35. The Nasdaq Composite Index closed down 24.57 points, or 0.3%, at 9,178.86.
The U.S. Labor Department said the U.S. economy added 145,000 new jobs in December, below the 165,000 expected by economists and less than the 266,000 gain in the prior month. The unemployment rate, meanwhile, held near a 50-year low at 3.5%. Average hourly wage growth slipped to 2.9%, the worst since mid-2018.