First month of FY2024-25 ends flat with FIIs offloading their positions before the elections and amid the ongoing global tension. Lets take a tour through this weeks important news.
RBI Bans Kotak Mahindra Bank
The Reserve Bank of India (RBI) has taken significant regulatory action against Kotak Mahindra Bank (KMB), barring the bank from onboarding new customers through online and mobile banking channels and issuing fresh credit cards from April 24.
This move comes in response to supervisory concerns regarding the bank’s technology platforms, following an examination of its IT systems over the past two years.
The central bank’s decision stems from significant deficiencies and noncompliance observed in various areas of IT management, including inventory management, user access management, data security, and disaster recovery. Despite repeated assessments and corrective action plans, Kotak Mahindra Bank failed to address these concerns adequately.
Customers have been inconvenienced by frequent failures in the bank's digital channels and core banking system due to a lack of a strong IT infrastructure. The RBI has previously taken similar action against a bank due to issues with technology.
Similar limitations were imposed on HDFC Bank in 2020 as a result of recurrent disruptions to its online platforms, underscoring the regulator's dedication to guaranteeing the dependability and effectiveness of the digital infrastructure used by the banking industry.
The limits will hamper KMB's ability to issue credit cards and attract new clients, even though the ban won't harm current customers. This is because a significant percentage of new account openings happen online.
New Member in the Gamble
The National Stock Exchange of India (NSE) is about to launch derivative contracts for its highly sought-after Nifty Next50 index on Wednesday April 24, subject to approval by the SBI. The derivatives will consist of three serial monthly indexed futures and indices options contracts, which will be settled in cash and will expire on the final Friday of each expiration month. This will be in addition to the current suite of index derivative products.
The Nifty Next 50 Index comprises 50 companies from the Nifty 100, excluding those in the Nifty 50. It is also known as the Junior Nifty.
In March 2024, financial services made up 23.76% of the Nifty50 index, capital goods accounted for 11.91%, and consumer services made up 11.57% of the index. The Nifty50 Index was first launched on November 3, 1997, and has a base of 1000.
The market capitalization of the index constituents stood at Rs. 70 lakh crore on 29 March 2024, which is about 18% of the overall market capitalization of listed stocks on the NSE.
On a daily basis, the combined daily turnover of these constituents stood at Rs 9,560 crore, which is about 12% of the total cash market turnover during the financial year 2024.
₹18,000 Crore Push
Vodafone Idea, the debt-laden telecom giant, is set to launch its much anticipated Follow-on Public Offering (FPO) worth ₹18,000 crore. The bidding for the FPO will open on April 18 and close on April 22, with the anchor investor bidding taking place a day earlier on April 16.
The company has fixed the price band for the FPO at ₹10 to ₹11 per equity share of face value ₹10. The FPO comprises a fresh issue of up to 1,636.36 crore equity shares, with a lot size of 1,298 shares and a minimum investment of ₹14,278 for retail investors.
The FPO has a reservation of 50% for Qualified Institutional Buyers (QIB), 15% for Non-Institutional Investors (NII), and 35% for retail investors. Axis Capital, Jefferies India, and SBI Capital Markets are the book-running lead managers, while Link Intime India Private Ltd is the registrar.
The share allotment Is expected to be finalized on April 23, with the shares credited to demat accounts by April 24. The FPO is expected to be listed on April 25.
Vodafone Idea plans to use the FPO proceeds for network infrastructure expansion, 4G and 5G capabilities, spectrum payment to the Department of Telecommunications (DoT), and general corporate purposes. The fundraising is crucial for the company, which is burdened with a debt of ₹2.1 lakh crore, including dues to the government.
Quick through the week
India was the 4th biggest spender on military in 2023. The United States, China, and Russia, were ahead in the list: SIPRI.
RBI announced the yield rates for its new government securities; for 10-year it is 7.1889% (maturity in 2034), and for 50-year it is 7.3338% (maturity in 2073).
Swiggy has reportedly received approval for its IPO from its shareholders. The company plans to raise Rs 3,750 cr from new shares and Rs 6,664 cr through an offer-for-sale (OFS).
Motilal Oswal announced 3 bonus shares for every one share held by investors.
Bajaj Finserv net profit increased by 20% year-on-year to Rs 2,119 cr.
Dividend: Rs 1 per share.
Maruti Suzuki net profit increased by 48% year-on-year to Rs 3,878 cr in the Jan-March quarter. Dividend declared Rs 125 per share.
ICICI Bank Q4 Results reported a rise of 17.4% net profit at ₹10,707.5 crore, compared to ₹9,121.9 crore in the corresponding period last year
Dividend of Rs10 per equity share of face value of ₹2 each.
L&T Tech 8% increase in net profit to Rs 1,304 cr.
Dividend Rs 33 per share.
Axis Bank : reported a net profit of Rs 7,129 crore against a loss of Rs 5,728 crore in the year-ago period.
Net interest income grew by 11 percent to Rs 13,089 crore.
Reliance Industries net profits has gone down by 18.24% YoY that is to 11,283.
Net profit of 13.69% have decreased from Q0Q.
Happy Investing😊
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