Indian Stock Market News, Equity Market and Sensex Today in India | Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Of IL&FS Crisis, FDI Growth in the Telecom Sector, and Top Stocks in Focus Today
Thu, 27 Sep Pre-Open | Monish Vora, TM Team

Share markets in India ended their trading session marginally lower yesterday. Losses were largely seen in the FMCG sector and IT sector, while metal stocks ended the day higher.

At the closing bell yesterday, the BSE Sensex stood lower by 110 points (down 0.3%) and the NSE Nifty closed lower by 13 points (down 0.1%). The BSE Mid Cap index ended the day up by 0.4%, while the BSE Small Cap index ended the day up by 0.1%.

Top Stocks in Focus Today

From the banking space, Yes Bank share price will be in focus today as the company's board yesterday said that it would ask the Reserve Bank of India (RBI) to grant an extension of eight months to managing director (MD) and chief executive Rana Kapoor.

Punjab National Bank share price will also be in focus today as the bank has informed bourses that it will consider capital infusion of Rs 54.3 billion by the government of India today.

From the airlines sector, market participants will also track SpiceJet share price as reports suggested that the airline is in talks with Airbus to buy its A330neo wide-bodied planes.

--- Advertisement ---
Where Would You Like Us to Send Your Virtually Free Book?

Equitymaster's Secrets :: Our Biggest Lessons From Over Two Decades Of Investing Journey
We hope you're among the readers who have already claimed their virtually free copy of Equitymaster's Secrets: 2018 Limited Edition.

If you still haven't – well, hurry – because we're running out of copies.

This is one of our most popular books on investing - in fact, an earlier edition of this book is still available on Amazon for Rs 1,450.

But if you act today, you won't have to pay Rs 1,450. You can claim a virtually FREE copy of this book, and have it delivered right to your doorstep (anywhere in India).

Just click here to tell us where to send your book.
------------------------------

FDI in Telecom Sector Grows Nearly 5x in Last 3 Years

In the news from the telecom sector, as per an article in a leading financial daily, the foreign direct investment (FDI) in the telecom sector has grown nearly five times in the last three years, from US$ 1.3 billion in 2015-16 to US$ 6.2 billion in 2017-18.

As per the Union Telecom Minister Manoj Sinha, the new sectoral policy in works envisages the FDI in the telecom space to reach US$ 100 billion by 2022. He added that FDI would be key to unleash the full potential of upcoming modern technologies.

Sinha stated that the government is keen on providing 5G services in India at a par with global standards in 2020, which will play a key role in harnessing new emerging technologies like machine-to-machine communications, internet of things, artificial intelligence, etc.

The minister further said that India needs massive investments in developing newer technologies which are accessible and affordable to the people and at the same time create productive employment.

Further, he also said that India is poised to become the third largest economy in the world over the next two decades and it is the most opportune moment for the investors across the world to invest in India.

Speaking of telecom sector, the whole telecom business has been an underwhelming story so far. While the telecom subscriber base has increased from 300 million in 2008 to 1.2 billion in 2017, investors have little to cheer.

Here's what we wrote about the struggling telecom sector in one of our issues of The 5 Minute WrapUp:

  • Telecom companies are straddled with high debt, intense competition, and lack of pricing power. High spectrum costs and regulatory issues have hampered the sector. While consumers have benefited from low costs and new players fighting for their share, investors have suffered.

    With the entry of Reliance Jio, the competition has intensified further. Reliance Jio's low cost offerings and strategy of capturing market share will further dent the sector. The sector has been a classic 'valuet trap'. While it always looks cheap compared to other sectors, it has failed to provide any reasonable returns. We also believe the situation is unlikely to change in the near future. For an investor, it's important to differentiate between 'value' and 'value traps'.

LIC's Comment on IL&FS Crisis

Shares of IL&FS Group companies were trading on a positive note yesterday after state-owned insurer Life Insurance Corporation of India (LIC) said it will not allow debt-ridden IL&FS to collapse and explore options to revive it.

The above announcement comes as earlier this month, it came to light that IL&FS group defaulted on a short-term loan of Rs 10 billion from SIDBI, while a subsidiary has also defaulted Rs 5 billion dues to the development finance institution.

While IL&FS has nearly Rs 350 billion consolidated debt, IL&FS Financial Services has Rs 170 billion of debt, which sits as standard asset for most of the lenders, the reports noted.

The group has seen its various long-term and short-term borrowing programmes downgraded to 'default' or 'junk' grades by credit rating agencies, even as the regulators are also probing alleged delay in disclosure about certain loan defaults.

According to Moody's Investor Services, IL&FS's outstanding debentures and commercial paper accounted for 1% and 2%, respectively, of India's domestic corporate debt market as of 31 March 2018. Its bank loans made up about 0.5% to 0.7% of banking system loans.

There are concerns that the defaults by IL&FS could cause a contagion in the Indian financial sector.

It would be interesting to see how this pans out. Meanwhile, we will keep you updated on all the developments form this space.

From the Macroeconomic Space...

According to data published by the Comptroller General of Accounts (CGA), India's budgetary fiscal deficit for April-August at Rs 5.91 trillion accounted for 94.7% of the full year's target of Rs 6.24 trillion.

Till August this year, the government's total expenditure stood at Rs 10.70 trillion (43.85 per cent of the budget estimates) while the total receipts were Rs 0.0479 billion (26.38 per cent of the budget estimates).

Notably, fiscal deficit during the corresponding five months of the previous financial year was 96.1%.

The government missed its fiscal deficit target for FY18 by 30 basis points. Against a target of 3.2%, the government managed to keep fiscal deficit at 3.5% in FY18. It has also outlined the projected fiscal deficit target of 3.3% in FY19 in its budget.

Maintaining this deficit target in FY19 won't be easy. Fiscal deficit basically means the amount a government earns minus the amount it has to spend. The lesser the fiscal deficit, the better the government has performed.

In the past, the government has relied on reducing expenditure to keep the fiscal deficit in check.

For this year, the government is banking on earning much more than it has in the past. It expects a major portion of the revenue to be collected through GST tax collections. Also, the recent rise in crude oil prices has cast a doubt over how much the government will be to curb its spending.

The dual pressure of increasing expenditure and lower inflows makes this FY19 deficit target an uphill challenge.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

Read the latest Market Commentary


What else is happening in the markets today? Dig in...

Equitymaster requests your view! Post a comment on "Of IL&FS Crisis, FDI Growth in the Telecom Sector, and Top Stocks in Focus Today". Click here!

  

Stock Market Updates

Bloodbath on Dalal Street: 6 Reasons Why Sensex Nosedived 1,939 Points Today (Today's Market)

Feb 26, 2021 Closing

Indian share markets end deep in the red with the Sensex down by 1,939 points and the Nifty ending down by 568 points.

ONGC Share Price Down by 7%; BSE OIL & GAS Index Down 4.0% (Today's Market)

Feb 26, 2021 03:34 PM

ONGC share price is trading down by 7% and its current market price is Rs 118. The BSE OIL & GAS is down by 4.0%. The top gainers in the BSE OIL & GAS Index is CASTROL INDIA (up 1.3%). The top losers are ONGC (down 7.1%) and GAIL (down 6.3%).

ULTRATECH CEMENT Share Price Down by 5%; BSE 500 Index Down 3.4% (Today's Market)

Feb 26, 2021 03:30 PM

ULTRATECH CEMENT share price is trading down by 5% and its current market price is Rs 6,487. The BSE 500 is down by 3.4%. The top gainers in the BSE 500 Index are SOUTH IND.BANK (up 10.4%) and JAGRAN PRAKASHAN (up 10.0%). The top losers are ULTRATECH CEMENT (down 5.0%) and BAJAJ FINSERV (down 6.3%).

JAGRAN PRAKASHAN Share Price Up by 10%; BSE 500 Index Down 3.2% (Today's Market)

Feb 26, 2021 03:26 PM

JAGRAN PRAKASHAN share price is trading up by 10% and its current market price is Rs 60. The BSE 500 is down by 3.2%. The top gainers in the BSE 500 Index are JAGRAN PRAKASHAN (up 10.1%) and RCF (up 11.0%). The top losers are MAHINDRA CIE AUTO. and AJANTA PHARMA (down 0.1%).

UPL Share Price Down by 5%; BSE 500 Index Down 3.2% (Today's Market)

Feb 26, 2021 03:26 PM

UPL share price is trading down by 5% and its current market price is Rs 589. The BSE 500 is down by 3.2%. The top gainers in the BSE 500 Index are RCF (up 11.0%) and SOUTH IND.BANK (up 10.4%). The top losers are UPL (down 5.4%) and BAJAJ FINSERV (down 6.2%).

ICICI LOMBARD GENERAL INSURANCE Share Price Down by 5%; BSE 500 Index Down 3.2% (Today's Market)

Feb 26, 2021 03:26 PM

ICICI LOMBARD GENERAL INSURANCE share price is trading down by 5% and its current market price is Rs 1,479. The BSE 500 is down by 3.2%. The top gainers in the BSE 500 Index are RCF (up 11.0%) and SOUTH IND.BANK (up 10.4%). The top losers are ICICI LOMBARD GENERAL INSURANCE (down 5.2%) and BAJAJ FINSERV (down 6.2%).

View More Indian Share Market News

Most Popular

It's the Beginning of a New Bull Phase in Smallcaps(Profit Hunter)

Feb 24, 2021

Last time the smallcap index crossed 19k a big correction followed. Here's what makes it different this time.

Intraday Trading for a Living(Fast Profits Daily)

Feb 15, 2021

In this video, I'll cover your queries on intraday trading and also share my view on how to decide stop losses and target prices.

Top 5 Stocks Mutual Funds Bought and Sold in January 2021(Sector Info)

Feb 16, 2021

A look at what India's top equity mutual funds bought and sold in January 2021.

I Would Recommend this Small-cap Stock Over Tesla(Profit Hunter)

Feb 16, 2021

Do you enjoy reading Tesla and Bitcoin stories? Here's a not so famous small-cap stock to profit from the rise of EVs.

More

India's #1 Trader
Reveals His Secrets

Secret To Increasing Your Trading Profits Today
Get this Special Report,
The Secret to Increasing Your Trading Profits Today, Now!
We will never sell or rent your email id.
Please read our Terms

S&P BSE SENSEX


Feb 26, 2021 (Close)

MARKET STATS