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Realty Stocks Soar
Thu, 8 Sep 01:30 pm

After opening the trading day on a flat note, Indian equity markets continue to trade near the dotted line with positive bias amid firm international markets. Barring IT sector, all the sectoral indices are trading in green. Gains are largely seen in Realty and metal stocks.

The BSE Sensex is trading higher by 67 points and the NSE Nifty is trading higher by 20 point. The BSE Small Cap index is up by 0.7%, while the BSE Mid Cap index is down by 0.1%. The rupee is trading at 66.36 to the US$.

Automobile stocks are trading on a firm note with Bajaj Auto and Hero Motocorp leading the gains. According to a leading financial daily, Ashok Leyland will buy partner Nissan's stakes in Ashok Leyland Nissan Vehicles, Nissan Ashok Leyland Powertrain and Nissan Ashok Leyland Technologies.

Ashok Leyland and Nissan announced a restructuring agreement in which Nissan agreed to sell to Ashok Leyland all of its shares in the three joint ventures (JV) that were formed in 2008. These companies will become wholly-owned Ashok Leyland subsidiaries. The process is expected to be concluded this year.

As per the reports, Ashok Leyland will continue to manufacture under a licensing agreement the Dost and Partner light commercial vehicles that are based on Nissan's design, engineering and technology. The firms will continue their arrangement to procure spare parts from India for Nissan.

The much talked about Nissan-Ashok Leyland venture reportedly turned sour (Subscription Required) with the Japanese company serving a notice for the termination license on NALT reportedly due to delay in a bill payment of Rs 23 million.

Ashok Leyland recently reported a 6% decline in total sales at 10,897 units in August 2016. The company had sold 11,544 units in August last year. Sales of heavy and medium commercial vehicles declined by 8% to 8,201 units last month as against 8,903 units in the year-ago period.

Moving on to news from banking sector. According to a leading economic daily, Yes Bank has launched a Qualified Institutional Placement (QIP) issue to raise US$1 billion. The bank proposes to use the funds to bolster its capital for meeting prudential norms and support its expansion.

Yes Bank and some of its private sector competitors are increasing their loan books at double the pace of state-run rivals, which have been burdened by a surge in bad loans.

The Yes Bank fund raising will be the biggest QIP so far in 2016. In June 2014, Yes Bank had raised US$500 million (Rs 29 billion) through a QIP. So far this year, just five companies have raised Rs 7.08 billion through the QIP route. In 2015, 32 companies had raised Rs 190.64 billion through QIPs.

Meanwhile, State Bank of India has also reportedly picked banks to work on a bond offering that could raise about US$1 billion. This will be India's first sale of dollar additional Tier 1 bonds since the country implemented Basel III rules.

In another development, Yes Bank has commenced first of its kind Unified Payments Interface (UPI) services by partnering with 50 businesses including Flipkart, Myntra and Jabong onto the new platform through a partnership with payment aggregator Phonepe.

Yes bank aims to make fund transfer easier and move towards a cashless economy. The UPI framework will enable low cost, high volume, electronic payments straight from the user's SmartPhone, and will make transactions instant, secure and interoperable. Yes bank is presently trading down by 4.7% on the BSE.

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Jan 16, 2018 02:53 PM