Namaste! Aaj ka news roundup, Newswala style!

MARKETS

Markets: Nifty opened flat but gained momentum throughout the day, closing with a strong 176-point increase. The IT Index played a crucial role, contributing significantly as Nifty surged past 24,000, marking a substantial 700-point rally over the last four sessions.

BUSINESS

India's Massive ₹3 Trillion Real Estate Investment Boom

What happened

Get ready to see some serious money flying around in the real estate sector! The investments totalling ₹1 trillion over the last two years are set to triple by FY25, reaching a staggering ₹3 trillion. Developers are seizing this opportunity to expand aggressively, focusing on increasing both residential and commercial leasing projects. This surge reflects optimism about sustained growth in the sector, signalling robust activity ahead.

Why it matters

Well, with residential properties and commercial leases becoming the new hotcakes in town, every developer is splurging crores to snatch up land and build like there's no tomorrow. Last year alone, they snagged 1,185 acres and built enough housing to cover a small country (410 million sq ft. to be exact).

• This year, project launches are expected to jump by 25%, with construction costs estimated at a hefty ₹75,000 crore.
  
  

• Home sales peaked in Q1FY24, reaching nearly 130,000 units across major cities, signalling strong demand recovery post-pandemic. 
  
  

• Office space absorption also surged by 19% in the first half of FY24 compared to the previous year, totalling 29.4 million sq ft.
  

Zoom out

Big names like Brigade Enterprises and Prestige Estate Projects are pursuing ventures worth billions. Brigade plans a whopping 16 million sq ft expansion across Bengaluru, Chennai, Hyderabad and Mysore. Meanwhile, Prestige Estate is selling ₹5,000 crore in shares to investors, focusing heavily on residential projects.

With cash flowing and regulators nodding (thanks, RERA!), developers are also leveraging IPOs, QIPs, and rights issues to fund even bigger plans. 

BIG MONEY MOVES

BHEL wins ₹13,300 cr contract for 1600 MW power plant

Bharat Heavy Electricals Ltd (BHEL) has snagged a whopping ₹13,300 crore contract from the Damodar Valley Corporation (DVC) to build a 1600 MW thermal power plant in Koderma, Jharkhand. This deal, finalised on June 26, 2024, supports the government's energy security goals. By 2030, DVC's thermal generation capacity will rise to 8140 MW, promising a powerful boost to both the economy and local communities.

UltraTech's ₹1,900 crore cement deal sets the market abuzz

UltraTech Cement is making big moves, announcing the purchase of a 23% stake in India Cements, valued at ₹1,885 crore. The purchase, initiated with morning block deals on June 27, involved buying 19.44% of shares, with plans to secure another 3.4% soon. This strategic acquisition, which started at ₹267 per share and could reach up to ₹285 per share, has propelled India Cements' stock to a 52-week high of ₹298.8, up 11.11%.

UltraTech's bold move not only boosted their portfolio but also sparked a frenzy in the market, where cement deals are making investors feel 'concrete' about their choices.

BUSINESS

India’s Bond Market Gains Global Ground with J.P. Morgan Inclusion

What happened

India is set to join the prestigious J.P. Morgan GBI-EM Global Series on June 28, 2024, potentially attracting $25-30 billion in inflows. This phased inclusion will see domestic bonds gradually achieve a 10% weight in the index over the next 10 months. With a current turnover of over $350 billion in 2023, India's inclusion will significantly boost non-resident participation in its local bond market. 

Why it matters
 

This is a monumental step for India's fixed-income market, making it the 25th market to be included since the index's inception in 2005. Market experts believe this move will spotlight India's bond market, drawing substantial foreign investments. Vishal Goenka from IndiaBonds called it a "watershed moment," predicting that the initial $25-30 billion could pave the way for even more inflows in the coming years.

This inclusion not only increases the weight of EM Asia in the index but also highlights India's economic stability, low inflation and fiscal discipline, making it an attractive investment destination.

Zoom out

Since September 2023, Foreign Institutional Investors (FII) have already invested over $10 billion in Indian Government bonds in anticipation of this inclusion. Currently, Foreign Portfolio Investors (FPIs) hold 2.4% of outstanding Government Securities, a figure expected to rise to approximately 5% over the next 12-18 months as Indian bonds gain entry into other global indices. 

With India’s bond market on the global radar, the future looks bright and bustling, much like the streets of Mumbai at rush hour!

BIG PICTURE

Japan considers Yen rescue as currency hits 38 year low

Japan is eyeing interventions to support the yen after it plummeted to a 38 year low against the US dollar. Finance Minister Shunichi Suzuki expressed concerns over the rapid depreciation, emphasizing the potential economic fallout. The yen weakened to 160.88 per dollar, its lowest since 1986, amid global economic uncertainties and divergence in monetary policies between Japan and the US.

While beneficial for exporters, the yen's decline has spiked import costs, straining household budgets.

Tamil Nadu plans international airport to boost economic growth

Tamil Nadu Chief Minister MK Stalin announced the establishment of an international airport in Hosur on June 27. The proposed airport will span 2,000 acres and handle 30 million passengers annually. This move aims to transform Hosur into a key economic centre, boosting its socio-economic development along with neighbouring areas like Krishnagiri and Dharmapuri.

The Industries Minister TRB Rajaa emphasised the economic benefits, highlighting Hosur's proximity to Bengaluru and Chennai and its growing manufacturing ecosystem. "Hosur's weather is so good, even planes will want to stay longer," quipped Rajaa. 

BUSINESS

JSW Energy Surges 4% After Securing 1,325 MW RE Projects

What happened

Shares of JSW Energy jumped nearly 4% to ₹739 as the company's subsidiary inked hefty Power Purchase Agreements (PPAs) for renewable energy projects totalling 1,325 MW. The agreement, including 1,025 MW with the Solar Energy Corporation of India Limited (SECI) and 300 MW with Gujarat Urja Vikas Nigam Limited (GUVNL), lock in power supply for 25 years at competitive tariffs of ₹2.66/KWh and ₹3.62/KWh respectively.

JSW Neo Energy, their superhero sidekick, also clinched a Letter of Award (LoA) for a 300 MW ISTS-connected wind-solar hybrid project from SECI. This move is part of JSW Energy's plot to expand its renewable energy empire and beef up its total generation capacity.

Why it matters

JSW Energy's grand plans in renewable energy are backed by their recent equity raise of ₹5,000 crores through a Qualified Institutions Placement (QIP). The funds are marked for debt repayment, investment in JSW Neo Energy and general corporate purposes.

Their commitment to green hydrogen initiatives, including a side hustle with JSW Steel for 3,800 tonnes per year of green hydrogen, shows they're not just about watts and volts—they're into making clean energy cool. Plus, being part of the Strategic Interventions for Green Hydrogen Transition (SIGHT) program means they're already buckled up to lead the hydrogen economy.

Zoom out

The company currently boasts a locked-in generation capacity of 13.6 GW, with 7.3 GW operational and 2.6 GW under construction across the wind, thermal and hydro sectors. Additionally, JSW Energy has secured PPAs for another 1.3 GW in its renewable energy pipeline, underscoring its commitment to scaling up green energy projects.

Looking ahead, JSW Energy aims to achieve 20 GW of generation capacity and 40 GWh of energy storage capacity by 2030.

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