10 November 2023

NewsWala aaya, taaza khabre laya! Good morning!
 

MARKETS

Markets: Adani Enterprises, HUL, Tata Consumer Products, Adani Ports, and ONGC experienced declines on the Nifty, while M&M, Apollo Hospitals, Coal India, Hero MotoCorp, and Power Grid Corporation were among the top gainers.

BUSINESS

InCred Finance ascends to unicorn glory

What happened

In a financial twist that's as magical as a unicorn sighting, InCred Finance, the lending arm of InCred Group, has successfully secured ₹500 crore ($60 million) in its Series D funding round, earning itself the coveted "unicorn" status. In a year where India's unicorn club seemed to have locked its doors, InCred's achievement stands out.

The latest funding has propelled the company's valuation to approximately ₹8,800 crore ($1.05 billion). This funding comes sweet sixteen months after InCred Finance merged with the US private equity giant, KKR.

Why it matters

InCred Finance's ability to raise ₹500 crore in Series D funding showcases strong investor confidence and a bright future in the fintech space. The company has its sights set on making a significant impact across its core business verticals, including 

• consumer loans, 

• student loans, 

• and MSME lending.

The funding will undoubtedly fuel these ambitions and help them grow stronger.

Zoom out

InCred isn't just about lending; it's part of the larger InCred Group. The group's diverse businesses span wealth and asset management, investment banking through 'InCred Capital,' and retail bonds and alternative investments under 'InCred Money.' This expansion into multiple financial domains adds a dash of versatility to the InCred Group, making them more than just a unicorn; they're a multi-horned financial powerhouse.

BIG MONEY MOVES

Legal Triumph Unleashes Vodafone Idea's Stock Surge

Vodafone Idea experienced a 2.5% surge in its stock value following a Bombay High Court decision to compel the income-tax department to reimburse the telecom company with a substantial sum of Rs 1,128 crore , previously paid as outstanding dues for the 2016-17 period. The court deemed the assessment order against Vodafone Idea as both "unsustainable and time-barred," underscoring the urgency of accountability and swift action.


Ashok Leyland charges up electric mobility with ₹1,200 crore

Ashok Leyland, a Chennai-based commercial vehicle manufacturer, is set to bolster its electric mobility initiatives with a substantial investment of ₹1,200 crore in its electric mobility subsidiary, Switch Mobility. The funds will primarily support the expansion of product offerings, research and development efforts, and operational improvements in both the UK and India. 

BUSINESS

Go First nears terrifying legal showdown

What happened

In a plot twist that could rival any courtroom drama, the lenders of India's grounded airline, Go First, are gearing up for a legal showdown. India recently made a significant alteration to its bankruptcy laws, effectively excluding leased aircraft from the assets that can be frozen during bankruptcy proceedings.

This change created a buzz in the aviation industry, with lessors of Go First eager to regain control of their planes. But here's where the turbulence begins. The lenders of Go First owed a hefty $783 million , and are far from pleased with the prospect of their planes being released. They fear that this could further erode the already grounded airline's value.

Why it matters

This high-flying legal battle serves as a vivid reminder of the delicate balance between the interests of various stakeholders in the aviation industry. On one side, lessors are eager to retrieve their valuable assets. On the other hand, lenders are concerned about the impact on the airline's value and the potential fallout for their investments.

• The lenders are arguing that the bankruptcy law changes should only affect future cases, not Go First's situation, which was already under bankruptcy protection when the law was amended.

• As we await the Delhi High Court's decision, it's clear that the fate of more than 50 Airbus planes of Go First hangs in the balance.

Zoom out

The drama surrounding Go First highlights the complexities of navigating the legal landscape in the aviation industry. This case also emphasizes the importance of clear and well-defined laws to protect the interests of all parties involved, from lessors and lenders to potential bidders and, ultimately, passengers who rely on these airlines for their travel needs. 

NewsWala silently watches the lenders crying in a corner

BIG PICTURE

🎯  Tata Technologies targets $2.5 billion valuation

Tata Technologies, a part of India's Tata Group, is in discussions with Morgan Stanley Investment Management, Blackrock, and U.S. hedge funds to invest in its upcoming IPO at a notable valuation of $2.5 billion . This marks a significant milestone as it's the first IPO in two decades for a Tata Group company.

✂️  Disney surpasses profit forecasts, slashes costs by $2 billion

Disney exceeded earnings expectations, primarily driven by profit from ESPN+ and ongoing growth in its theme parks. However, a decrease in ad revenue, notably from Disney's ABC Network and other owned TV stations, had a negative impact. The company is intensifying cost-cutting efforts, aiming to reduce costs by an additional $2 billion, targeting a total of $7.5 billion in savings.

BUSINESS

Government's agri-subsidy surge

What happened

The Indian government is injecting additional funds into subsidies for food, fertilizers, and rural job schemes in the second half of the current financial year. This strategic move is designed to accelerate spending, all while keeping a watchful eye on the fiscal deficit target for FY24, set at 5.9 percent of GDP.

The government budgeted substantial subsidies for the fiscal year, including ₹1.97 lakh crore for food, ₹1.75 lakh crore for fertilizers, and ₹60,000 crores for the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).

Why it matters

Predictability takes centre stage in the government's financial strategy. Their cash position is robust, and they're keen to keep borrowing in line with expectations, avoiding surprises in the bond market. 

• This approach aligns with their commitment to meet the fiscal deficit target for the year, totaling ₹17.87 lakh crore .

• The acceleration in government spending, particularly in the second half of the fiscal year, will stimulate economic activity and support key sectors, driving growth.

These expenses are expected to be offset by gains from robust tax collections, reflecting a sturdy financial position.

For more context

On September 26, the finance ministry announced that they were going to borrow a large amount of money, which is Rs 6.55 lakh crore, by selling some special types of bonds. So far, in the first part of the year, they've already borrowed Rs 8.88 lakh crore. This is a lot of money!

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