Namaste! Aaj ka news roundup, Newswala style!

MARKETS

Markets: The markets remained volatile, ending nearly flat after a mixed bag of earnings reports. Nifty surged early but sharply declined, closing at 24,815, as pressure mounted on metal, IT, and FMCG stocks, with broader indices shedding nearly 1.5%.

TOP STORIES

UltraTech Cement Battles Competition, Q2 Profits Decline

What Happened

UltraTech Cement faced a challenging second quarter, with net profit plunging 36% year-on-year to ₹820 crore. Despite a 4% increase in sales volume, reaching just under 28 million tonnes, the company struggled due to a significant drop in domestic grey cement realizations, which fell 8% to ₹4,901 per tonne.

• This accounts for a whopping 92% of UltraTech's sales, leading to a 21% fall in earnings.
  
  

• With EBITDA margins decreasing to 12.9%, the cement giant is feeling the heat.
  

Why It Matters

The stiff competition between UltraTech and the Adani Group is intensifying, as both companies expand their capacities aggressively. UltraTech is not just putting down roots; it's planning to surpass 200 MTPA by FY27, thanks to ongoing projects and recent acquisitions.

They recently raised $500 million through a sustainability-linked loan, signalling a commitment to green initiatives. 

What’s next?

Despite its current challenges, UltraTech remains optimistic about the future, banking on a predicted 7-8% growth in cement demand, driven by rising government infrastructure spending and urban housing needs. With a focus on sustainability—reporting a 32% share of green energy in its power mix—UltraTech is laying the groundwork for a cement-powered India, literally!

PAISON KA KHEL

Silver races past ₹ 1 lakh mark!

Silver’s shining moment arrived as it hit a record ₹1 lakh per kg, with a 3% GST! That’s a jump of ₹5,000 in just one weekend. Experts predict it could touch ₹1.25 lakh, thanks to its growing demand for electric vehicles and solar panels. As gold climbs to ₹78,000 for 10 grams, silver is looking like the "poor man’s gold" – and it's sprinting to keep up! 

Groww grows big but pays the price for relocation

Groww's revenue hit a high of ₹3,145 crore in FY24, doubling from ₹1,435 crore in FY23. The financial platform, backed by Tiger Global, stayed operationally profitable with a 16.8% profit bump to ₹535 crore. However, a hefty one-time ₹1,340 crore tax for shifting its domicile to India left it with a net loss of ₹805 crore. 

Still, Groww now boasts 1.2 crore active investors, leading the stock-broking game. While competitors like Zerodha and Angel One are earning more, Groww’s growth streak is impressive—just with a pricey twist!

TOP STORIES

DMart Takes on Quick Commerce

What Happened

India's retail sector is undergoing a dramatic transformation, and DMart, a major player in this field, is at the heart of it all. Recently, Avenue Supermarts, which operates DMart, reported a 5.78% increase in net profit, reaching ₹659.44 crore for the September quarter. 

While this sounds good, the overall earnings fell short of expectations, largely due to the growing competition from quick commerce platforms. With quick delivery services like Zepto and Swiggy Instamart taking a bite out of traditional retail, the once-booming sector is feeling the heat.

Driving the news

The retail sector in India is shifting faster than a bargain shopper can grab a deal. Modern trade sales have dipped to a four-year low, growing just 3.2% during July and August compared to 24% last year. 

Consumers are increasingly turning to online channels for their shopping needs, causing significant disruptions. Quick commerce is leading this charge, accounting for nearly a third of online sales, with modern trade only holding onto 12-15% of FMCG sales.

Zoom out

DMart is choosing to focus on expanding its physical store footprint rather than competing on the speed of delivery, emphasising value retailing over convenience. Their CEO has even noted, "Quick commerce is about convenience, not discount," hinting that they aim to attract price-sensitive shoppers who may not mind a little inconvenience.

GLOBAL NAZARA

Starbucks tries to perk up sales with budget brews

Starbucks is brewing up a plan to draw more customers, and it's as simple as cheaper coffee. To combat slowing footfall, they’ve launched a ‘Classic’ menu offering hot and iced coffee starting at just ₹150—20-30% cheaper than their regular options. 

With inflation causing a dine-out dilemma, Starbucks is hoping this affordable option will bring back more coffee lovers. Despite lower footfall, they saw a 2% revenue rise in Q3. Opening 19 new stores in September, they’re eyeing long-term growth but with a shot of caution for the short-term hiccups. 

Boeing's shares soar as strike talks take off

Boeing's shares took flight, climbing 4% on Monday amid hopes of ending a month-long strike that’s been grounding its 737 MAX jets. Around 33,000 workers will vote on a new contract Wednesday, which includes a 35% pay hike over four years, a $7,000 bonus, and beefed-up retirement contributions. While workers are still holding out for a 40% raise, Boeing hopes this deal will clear the runway for recovery.

TOP STORIES

Asian IPO Frenzy Raises Hopes for Market Revival

What happened?

Asia is seeing a blockbuster week for IPOs, with 20 companies expected to raise as much as $8.3 billion through share listings. This is the largest IPO activity since April 2022, and companies from China, India, and Japan are leading the charge. 

Indian IPOs, in particular, are booming, with proceeds set to surpass $12 billion this year, thanks to Hyundai Motor India’s massive $3.3 billion listing. Other major players include China Resources Beverage and Horizon Robotics, which are raising a combined $1.3 billion in Hong Kong. Japan is also joining the IPO frenzy with Tokyo Metro's $2.3 billion listing.

The revival?

The IPO wave signals growing confidence in Asia’s capital markets, with companies eager to raise funds before potential market disruptions, including the US election. For India, Hyundai’s listing is significant, marking the country's largest-ever IPO.

However, despite Hyundai's success, smaller investors showed limited interest due to a sluggish auto market, hinting at cautious optimism. In China, the strong demand for companies like Horizon Robotics shows a potential rebound for Hong Kong’s market, which has been quiet in recent years. 

Wait and watch

This week's IPO bonanza is a major test for Asia's capital markets. While the excitement is high, the real test will be how these stocks perform after their debuts. If the major players succeed, it could spark a new wave of listings in the region. However, with mixed signals from markets and ongoing economic concerns, particularly in India’s auto sector, it remains to be seen if this IPO rally is the beginning of a sustained trend or just a brief resurgence. 

MIRCH MASALA

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