5 Reasons Why Sensex and Nifty Plunged 2% Today
Closing

Indian share markets witnessed heavy selling pressure today despite the US administration saying it would bring a stimulus package even without the opposition's support.

Both benchmarks, Sensex and Nifty gave up their entire gains of 2021.

At the closing bell, the BSE Sensex stood lower by 938 points. Meanwhile, the NSE Nifty ended down by 271 points.

Axis Bank and Titan were among the top losers today.

SGX Nifty was trading at 14,030, down by 223 points, at the time of writing.

The BSE Midcap index ended down by 1.4%. The BSE Smallcap index ended lower by 0.5%.

On the sectoral front, metal stocks, banking stocks and finance stocks were among the hardest hit.

Asian stock markets ended on a mixed note. As of the most recent closing prices, the Hang Seng was down 0.3% and the Shanghai Composite stood higher by 0.1%. The Nikkei ended up by 0.3%.

US stock futures are trading mixed today. Nasdaq Futures are trading up by 60 points (up 0.4%), while Dow Futures are trading down by 85 points (down 0.3%).

The rupee is trading at 72.92 against the US$.

Gold prices are trading down by 0.6% at Rs 48,844 per 10 grams.

{inlineads1}

Here are Top 5 Factors Why Indian Stock Markets Plunged Today

Pre-Budget Nervousness: Pre-Budget nervousness and broader profit-taking have been attributed for the current round of selloff. Reports also state that locking up of large sums in the recent IPOs have also led to this selloff.

FIIs Turn Bearish: Foreign institutional investors (FIIs) have turned bearish on Indian share markets and have started to book profits. On January 25, FIIs net sold shares worth Rs 7.7 billion in the Indian equity market while on January 22 they sold shares worth Rs 6.4 billion.

However, so far in the month of January they have been net buyers of Rs 193.4 billion, data from NSDL showed.

US Federal Reserve Meeting: The US central bank will announce the verdict of its two-day policy meeting today, and it is expected to stand pat on policy.

Weak Global Cues: Asian and European stock markets are mixed today as investors were cautious ahead of US Fed meet outcome later today while uncertainty around US stimulus also weighed on sentiment.

Sectoral Indices Bleed: Banking and finance stocks witnessed huge selling pressure today with the Nifty Bank index plunging more than 1,000 points in intraday trade.

We will keep you updated on how these factors develop in the coming days and what effect they have on Indian stock markets. Stay tuned!

Speaking of stock markets, note that the BSE Sensex crossed the historical milestone of 50,000 last week on Thursday.

The BSE Sensex rose from 40,000-mark hit on October 8, 2020 to 50,000 in just 74 sessions. Developments on the vaccine front, a change of guard in the United States, FII buying and recovery in economic growth are the key factors behind this rally.

However, in the past four trading sessions, the Sensex has lost over 2,500 points.

Our editors have been pointing out for many weeks now about the risky nature of the market as Covid-19 remains an overhang and the economic outlook remains uncertain. The Sensex valuation is at nearly 40 times.

Have a look at the two charts below, in the order they have been placed.

Near Term Volatility in Sensex Compensated by Long Term Gains

The year-on-year change in the Sensex was hardly predictable but someone who stayed invested multiplied every lakh nearly 14 times.

As per Co-head of Research at Equitymaster, Tanushree Banerjee, 2021 could be one of the best years for individual investors.

{inlineads2}

Here's what she wrote in one of the editions of Profit Hunter:

  • 2021 could be one of the best years for individual investors.

    You read that right. Investing is one of those rare pursuits where amateurs can have an advantage over professional fund managers.

    It happens in almost no other field. If you compete against a professional sports person, you'd lose every time. As an amateur doctor or scientist, you need years of training before performing highly specialised tasks.

    However, individual investors who have a strategy to create long term wealth, stand a good chance at outperformance.

    Most professional fund managers can't afford to have long time horizons. A year or two of poor performance and they risk the sack.

    But an individual investor can sit tight over high conviction stocks and invest consistently to see the magic of compounding.

    Just like the investors in Titan saw their wealth creation unfold since 2004.

    So, 2021 could be extremely profitable, over time, provided you reset your portfolio with the right kind of safe assets and safe stocks.

    For the next decade, your best fund manager could be none other than you!

    Prepare well and ensure you make the most of it.

In her latest video, Tanushree discusses the best safe assets for 2021. You can watch the video here: Safest Assets in 2021 are Not What You Think...

Also speaking of stock markets, in our new video series called Momentum Moves, Brijesh Bhatia talks about what market participants can expect this week.

Tune in to the video to find out more:

Moving on to stock specific news...

Tata Consultancy Services (TCS) was among the top buzzing stocks today.

India's largest IT services provider TCS' brand value grew by US$ 1.4 billion in 2020, the highest among IT services firms globally, according to Brand Finance 2021 report.

The company's brand value stood at US$ 14,924 million in 2021 as opposed to US$ 13,499 million in 2020.

According to the Brand Finance report, the growth on brand value of US$ 1.4 billion is the highest absolute growth among the 25 firms assessed in the IT services space.

{inlineads3}

The report said this growth was seen in a challenging year when the brand value of IT services companies collectively dropped by 3%. Further, at 10% growth over the prior year, TCS has outperformed its peers in the Top 3 category.

The world's leading brand valuation firm also ranked TCS at the third position among the top 25 IT companies globally.

According to the report, this was possible because of the company's ability to quickly adapt to new ways of working through the launch of its Secure Borderless Workspaces, its remote working platform and its robust financial, customer and market performance amid the pandemic.

Apart from TCS, the other key brands that featured in the Brand Finance report under Global 500 include Accenture, which ranked 60.

Infosys was ranked at 212 in brand value at US$ 8,402 million, up 18.6% from US$ 7,087 million last year. Cognizant's brand value dipped from the rank of 219 in 2020 to 231. Other Indian IT firm HCL Technologies was ranked 353, up from 425 in 2020 and Wipro's rank rose to 457 in 2021 from 493 last year.

TCS share price ended the day down by 0.8%.

Moving on to news from the IPO space...

Kitchen appliances maker Stove Kraft which opened its initial public offering (IPO) for subscription on Monday was subscribed 2 times on the second day of bidding.

The offer size has been reduced after the company raised Rs 1.8 billion from anchor investors on last Friday, a day before the issue opening.

The subscription at retail investors desk was full as their reserved portion subscribed 10.6 times.

This is the fourth company to launch an IPO in the current month after Indian Railway Finance Corporation (IRFC), Indigo Paints and Home First Finance Company.

The IPO comprises fresh issue of Rs 950 million by the company and offer for sale of 8.25 million equity shares by promoters and investors.

The company has fixed a price band of Rs 384-385 per share.

Stove Kraft aims to raise Rs 4.1 billion through this offer. The company already raised Rs 1.9 billion from anchor investors on January 22.

We will keep you updated on the latest developments from this space. Stay tuned.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.


Sensex Trades Over 500 Points Lower; Dow Futures Down by 77 Points
12:30 pm

Share markets in India are presently trading on a negative note.

The BSE Sensex is trading down by 553 points, down 1.1% at 47,794 levels.

Meanwhile, the NSE Nifty is trading down by 150 points.

Wipro and Tech Mahindra are among the top gainers today. Axis Bank and Tata Motors are among the top losers today.

The BSE Mid Cap index is trading down by 0.5%.

The BSE Small Cap index is trading down by 0.2%.

On the sectoral front, all sectors are trading in red, with stocks from the telecom sector, witnessing most of the selling pressure.

US stock futures are trading mixed today.

Nasdaq Futures are trading up by 60 points (up 0.4%) while Dow Futures are trading down by 77 points (down 0.3%)

The rupee is trading at 72.81 against the US$.

Gold prices are trading down by 0.5% at Rs 48,878 per 10 grams.

{inlineads1}

In international markets, gold prices dipped 0.3% today ahead of the US Federal Reserve's monetary policy decision due later in the day. While the US central bank is not expected to make any major announcements, traders will be keen to find out about any new plans for monetary policy.

Note that gold has come under pressure in recent days on concerns that US stimulus package could be delayed.

Amid weak global prices, gold prices today fell sharply in Indian markets. On MCX, gold futures were down 0.6% to near one-month low of Rs 48,845, extending losses to the fourth day.

Speaking of the precious yellow metal, how lucrative has gold been as a long-term investment in India?

The chart below shows the annual returns on gold over the last 15 years...

As you can see, barring just two years - 2013 and 2015, gold has delivered positive returns in 13 of the last 15 years.

The recent price volatility in the bullion market has rattled many traders. Even with the recent volatility in prices, gold remains among the best performing commodities this year to combat the fallout from the coronavirus pandemic.

To know more about gold, check out our article on how to invest in gold here: How to Invest in Gold?

Moving on to stock specific news...

Among the buzzing stocks today is L&T.

Larsen and Toubro (L&T) reported its highest-ever fresh order intake in a quarter, for the quarter ended December, at Rs 732.3 billion, a jump of 76% year-on-year (YoY) while its order book stood at a historic high of Rs 3,130 billion.

The performance was backed by the company winning some big marquee orders in the infrastructure segment. New orders included large wins in High-Speed Rail Corridor, large orders in the hydrocarbon sector, and also large equipment supplies order in the construction and mining business. International orders during the quarter constituted 14% of the total order inflow, with 86% of orders coming in from the domestic market.

The company also reported a 5% YoY increase in its net profit for the quarter to Rs 24.6 billion. Revenues during the quarter, however, were still slightly lower as Covid-19 restrictions continued to have an impact on project site execution and Hyderabad metro operations. On a YoY basis, revenues declined 2% to Rs 355.9 billion but were up 15% on a sequential basis.

{inlineads2}

Earnings before interest, tax, depreciation and amortization (EBITDA) of the company increased 4.3% YoY to Rs 42.8 billion, while EBITDA margins were up 60 basis points YoY to 12%.

In terms of the segments, the infrastructure segment secured orders of Rs 455.7 billion, higher by 80% on a YoY basis. The EBITDA margin of the segment stood at 6.2%, up 10 basis points annually. The power segment did not secure any major order during the quarter and the segment's EBITDA margin was at 2%, lower compared to 3.4% in the corresponding quarter.

The EBITDA margin of the Heavy engineering segment came in at 20%, a decline over the corresponding quarter of the previous year of 23.5%, on account of changes in job mix. The hydrocarbon segment secured orders valued at Rs 128.2 billion during the quarter supported by receipt of some large value domestic orders in the petrochemicals space.

We will keep you posted on more updates from this space. Stay tuned.

At the time of writing, L&T share price was trading down by 1.9% on the BSE.

Speaking of stock markets, India's #1 trader, Vijay Bhambwani, talks about why it's not a good idea to blindly support the bullish consensus prevalent in the market these days, in his latest video for Fast Profits Daily.

Tune in here to find out more:

Moving on to news from the shipping sector...

Adani Ports to Raise US$ 500 Million From Overseas Bond Sale

Adani Ports & Special Economic Zone, the largest port operator in the country, is in the international debt market with a benchmark issue to raise at least US$ 500 million. This is the third large bond sale by domestic issuers after Exim Bank's US$ 1 billion issue at record low prices in the first week of the month followed by the State Bank of India (SBI) in the second week with a US$ 6 billion sale.

The company will use the proceeds from the issue primarily for refinancing the early redemption of its dollar bonds due in 2022.

The highly leveraged Adani Group is on massive expansion mostly using debt. In July 2020, the company had raised $750 billion and in December another $300 million, to retire some of its higher cost debt.

The issue has been rated BBB- by Fitch and Baa3 by Moody's.

{inlineads3}

Fitch Ratings in a note gave the proposed senior unsecured notes sale by the port operator a BBB- rating with a negative outlook.

The rating reflects the company's market-leading position, the stability of long-term cargo revenue and its operational efficiency, the agency said, adding the pandemic may result in weaker domestic demand and exports, but cargo mobility is largely uninterrupted despite the global lockdowns.

In a separate note, Moody's assigned a Baa3 rating to the issue with a negative outlook.

The rating takes into consideration the long-term growth potential of the domestic economy, a key driver behind the large increase in the volume of traded goods over the past few years, it said, adding the port operator reported 5.4% growth in cargo volumes in the first nine months of the current fiscal year.

Adani Ports is the largest port developer and operator in the country in terms of volume, with coal and other dry bulk terminals showing an annual capacity of 478.6 million tonnes.

How this pans out remains to be seen. Meanwhile, stay tuned for more updates from this space.

And to know what's moving the Indian stock markets today, check out the most recent share market updates here.


Sensex Opens Lower Tracking Mixed Global Cues; Tata Motors & Sun Pharma Top Losers
09:30 am

Asian share markets are trading on a mixed note today. All eyes are on the US Federal Reserve policy outcome due later today.

The Nikkei is trading up by 0.2% and the Hang Seng is trading up by 0.1%.

In US markets, Wall Street indices ended in the red overnight with the S&P and Nasdaq slipping from record closing levels as investors digested a batch of corporate earnings results.

Both, the Dow Jones Industrial Average and the Nasdaq Composite ended down by 0.1%.

Back home, Indian share markets have opened on a negative note.

Axis Bank, Hindustan Unilever (HUL), Bank of Baroda, Marico, Emami and India Cements are among 50 companies set to post their December quarter earnings today.

The BSE Sensex is trading down by 265 points. Meanwhile, the NSE Nifty is trading lower by 84 points.

UltraTech Cement is among the top gainers today. IndusInd Bank, on the other hand, is among the top losers today.

Both, the BSE Mid Cap index and the BSE Small Cap index have opened down by 0.6%.

All sectoral indices are trading on a negative note with stocks in the energy sector and automobile sector witnessing most of the selling pressure.

Shares of Century Plyboards hit their 52-week high today.

The rupee is trading at 72.87 against the US$.

Gold prices are trading down by 0.6% at Rs 48,850 per 10 grams.

{inlineads1}

Speaking of stock markets, note that since the lows in March 2020, the smallcap index has gained more than 100%.

While caution is indeed warranted, Richa Agrawal, Research Analyst at Equitymaster, thinks there is still a lot more steam left to this smallcap rally.

Despite rallying more than 100% since the March 2020 lows, Richa believes small-cap stocks are set for a massive up move in 2021 and beyond.

Here's what she wrote in a recent edition of Profit Hunter...

  • The P/E for smallcap index doesn't make sense. There are thousands of listed small companies. Some have negative earnings. The base is not a valid data to work with.

    That said, the closest proxy to relative valuations is the Smallcap to Sensex ratio,

    Historically, this ratio has averaged 0.43x. In the previous mega runs of the smallcap index, this ratio has gone as high as 0.75x.

    In January 2018, when smallcaps peaked, the ratio was at 0.58x.

    Guess where this ratio is now after a 100% run up in the smallcap index?

    0.38.

    It's lower than the median over 2 decades.

https://www.eqimg.com/profit-hunter/images/2021/01122021-chart-equitymaster.gif

Richa believes if you focus on the quality of business, margin of safety in valuations, and an optimum asset allocation, you are likely to create huge wealth for yourself.

In her latest video, Richa talks about how to not miss the 10 best days for your portfolio returns.

Tune in to the video to find out more:

In news from the financial markets, as per an article in The Economic Times, the government is looking to set up a Financial Redressal Agency (FRA) to examine all consumer complaints against regulated financial services providers.

A government official confirmed that deliberations have been held and an announcement could be made in the budget that will be presented on February 1.

India's existing consumer redressal system is fragmented and overseen by sectoral regulators such as the Reserve Bank of India (RBI) for banks and the Insurance Regulatory and Developmental Authority (Irda) for insurance-related grievances.

{inlineads2}

The government is of the view that this fragmented regulatory architecture leads to inconsistent treatment of both consumer complaints and micro-prudential regulation.

Set up under former pension regulator Dhirendra Swarup, the task force had pointed out in its report that existing consumer complaint redressal forums are not always adequately empowered or equipped to handle all categories of complaints.

In its recommendations, the task force had recommended a two-phase rollout. In the first phase, the FRA would look into complaints regarding the insurance sector and pension sectors that are currently being handled by Irda, the Insurance Ombudsman and the Pension Fund Regulatory and Development Authority (PFRDA).

Once this is stabilised, it would look into complaints against financial service providers regulated by the markets regulator as well as RBI.

How this pans out remains to be seen. Meanwhile, we will keep you updated on the latest developments from this space.

In news from the economic space, the International Monetary Fund (IMF) has pegged contraction in India's economy at 8% in the current financial year, higher than the 7.7% decline projected by the government's advance estimates.

However, it expects a growth rate of 11.5% in the next financial year before slowing to 6.8% in 2022-23, making India regain the tag of the fastest-growing large economy in the world in both the years.

{inlineads3}

In the World Economic Outlook released on Tuesday, the IMF said the second-quarter (Q2) gross domestic product numbers for India surprised it on the upside. India's economy fell by 7.5% in the quarter, while most experts had expected the contraction to be in double digits.

IMF was also surprised by the growth numbers for Australia, the euro area, Japan, Korea, New Zealand, Turkey, and the United States for Q2.

The IMF had earlier expected India's GDP to decline by 10.3% in FY21. However, the second-quarter numbers helped it revise the projection.

The IMF projected the global growth contraction for 2020 at 3.5%, 0.9 percentage point less than projected in the previous forecast, reflecting stronger-than-expected momentum in the second half of 2020.

The growth numbers for the next financial year may have implications for the Budget, which will be tabled in Parliament in less than a week.

Speaking of the Budget, in one of his videos for Fast Profits Daily, Vijay Bhambwani talks about the Union Budget 2021.

In the video, Vijay cover the sectors which would basically see the highest amount of expectation, buying and selling momentum.

Which stocks can you expect to move pre- and post-budget?

Tune in to the video to find out more:

Moving on to news from the energy sector, GAIL is among the top buzzing stocks today.

State-owned gas utility GAIL (India) is planning to launch an InvIT of its two gas pipelines between Dahej and Bengaluru ahead of a proposed splitting of the pipeline business from the gas marketing function.

Reportedly, the nation's top gas marketing and transportation firm plans to monetise Dahej-Uran-Panvel-Dabhol pipeline and Dabhol-Bengaluru pipeline by setting up an Infrastructure Investment Trust (InvIT).

InvITs are like a mutual fund, which enables direct investment of small amounts of money from possible individual or institutional investors in infrastructure to earn a small portion of the income as return.

The InvIT may involve selling 10-20% stake initially. The two pipelines proposed for InvIT had incurred over Rs 30 billion spending.

The move comes ahead of a planned spin-off of GAIL's pipeline business into a 100% subsidiary.

GAIL is India's biggest natural gas marketing and trading firm and owns more than 70% of the country's 16,981-km pipeline network.

Sources said a note for the split will be moved for the consideration of the Cabinet soon. The proposal involves separating the accounts of the pipeline division as well as transferring employees directly connected with the pipeline operations to the new subsidiary.

The government has a 54.89% stake in GAIL (India).

GAIL share price has opened the day down by 3.2%.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.


SGX Nifty Trades Flat, Stove Kraft IPO, Top Q3FY21 Results in Focus, and Buzzing Stocks Today
Pre-Open

Indian share markets witnessed huge selling pressure on Monday.

Benchmark indices extended losses with shares of Reliance Industries plunging as much as 6% after the announcement of its December quarter results.

Selling pressure was also seen after the Indian army said Indian and Chinese troops were involved in a "minor face-off" last week in a disputed stretch of their shared border in the eastern Himalayas.

At the closing bell on Monday, the BSE Sensex stood lower by 531 points. The NSE Nifty ended down by 133 points.

Bajaj Auto was among the top gainers. Reliance Industries, on the other hand, was among the top losers.

{inlineads1}

Both, the BSE Mid Cap index and the BSE Small Cap index ended down by 1.1%.

Barring metal and healthcare stocks, all sectoral indices ended on a negative note with stocks in the energy sector, oil & gas sector and IT sector witnessing maximum selling pressure.

Tata Consultancy Services (TCS) on Monday surpassed Reliance Industries to become the country's most valued firm by market capitalization.

Shares of Apollo Hospitals hit their 52-week high after the company said it has raised Rs 11.7 billion via qualified institutional placement (QIP) issue.

At 8:30 am today, the SGX Nifty was trading up by 7 points, or 0.1% higher at 14,200 levels. Indian share markets are headed for a flat opening today following the trend on SGX Nifty.

Gold prices were trading down by 0.2% at Rs 49,059 per 10 grams at the time of closing stock market hours on Monday.

To know more about gold, you can check out our detailed article on investing in gold here: How to Invest in Gold?

{inlineads2}

Top Stocks in Focus Today

Oberoi Realty will be among the top buzzing stocks today.

The Mumbai-based realty firm posted a 93.4% jump in profit after tax for Q3FY21, to Rs 2.9 billion from Rs 1.5 billion in Q3FY20.

The company said that sales in Mumbai Metropolitan Region boomed after the state government cut stamp duty and other levies last year.

The company's revenues went up 56% at Rs 8.4 billion in Q3FY21 as compared to Rs 5.4 billion in Q3FY20.

He added that the volumes during the quarter shows a clear shift of home buyers towards developers with financial stability and a proven track record.

Tata Motors share price will also be in focus as the company has raised prices of its passenger vehicle (PV) range to maximum Rs 26,000 depending upon the variant. The new price hike has come into effect from January 22, 2021.

{inlineads3}

Tata Motors said, "Rising input costs and material costs of steel, precious metals and semiconductors have compelled the company to pass on a part of the cost to customers."

"Continuing its commitment towards customers, the company will also offer protection from the price increase to customers who have booked Tata passenger vehicles on or before January 21, 2021," Tata Motors said.

On the company's Q3FY21 results, Tata Motors said that its PV business has witnessed strong demand for its 'New Forever' range of cars & SUVs and that the segment grew by 39% year-on-year (YoY) in FY21 over FY20.

In Q3FY21, Tata Motors also registered the highest ever sales in last 33 quarters and continues to work on debottlenecking the supply chain and ramp up its output to meet the increased demand."

Ultratech Cement share price will also be in focus as the cement producer's net profit more than doubled in the quarter ended December 31, 2020.

The Aditya Birla group company reported over two-fold jump in consolidated net profit to Rs 15.84 billion in the third quarter of the financial year.

The company's revenue from operations stood at Rs 122.5 billion, up 17.4%, during the October-December quarter under review compared to Rs 104.4 billion in the corresponding period of the last fiscal year.

Market participants will also track Reliance Industries (RIL) share price as the company reported a 12.5% year-on-year (YoY) rise in its consolidated net profit to Rs 131 billion.

The oil-to-telecom conglomerate reported consolidated revenues of Rs 1,200 billion which were up 21.1% YoY.

The weak topline performance of the company was attributable to the continued struggles of the refining business and retail business of the company due to the Covid-19 pandemic.

Speaking of stocks, in his latest video for Fast Profits Daily, Brijesh Bhatia shows a crucial chart that you need to check before you decide to sell any stock or index.

Tune in to the video to find out more:

IPO Buzz: Stove Kraft IPO Sees Strong Retail Interest

In news from the IPO space, Kitchen appliances maker Stove Kraft which opened its initial public offering (IPO) for subscription on Monday was subscribed 80% on the first day of bidding.

The offer size has been reduced after the company raised Rs 1.8 billion from anchor investors on last Friday, a day before the issue opening.

The subscription at retail investors desk was full as their reserved portion subscribed 4.3 times.

This is the fourth company to launch an IPO in the current month after Indian Railway Finance Corporation (IRFC), Indigo Paints and Home First Finance Company.

The IPO comprises fresh issue of Rs 950 million by the company and offer for sale of 8.25 million equity shares by promoters and investors.

The company has fixed a price band of Rs 384-385 per share.

Stove Kraft aims to raise Rs 4.1 billion through this offer. The company already raised Rs 1.9 billion from anchor investors on January 22.

In other news, Blackstone, the world's largest alternative asset manager and the largest owner of commercial real estate in India, has filed a draft red herring prospectus (DRHP) with markets regulator for an IPO by its portfolio company Aadhar Housing Finance to raise Rs 73 billion.

As per reports, the IPO will be a combination of fresh and secondary issue of shares.

The listing of Aadhar Housing Finance would be the first IPO of an Indian portfolio company backed by the US private equity giant in the past five years.

In October 2015, SH Kelkar backed by Blackstone launched a Rs 5-billion IPO. The US based private equity major is also considering a 2021 IPO by its auto component firm Sona Comstar.

We will keep you updated on the latest developments from this space. Stay tuned.

DoT to Favorably Consider Telcos' Plea on Notice Period for New Service

In news from the telecom sector...

As per an article in The Economic Times, the telecom department may favorably consider requests by Reliance Jio Infocomm and Bharti Airtel to halve the notice period for starting services based on a new technology to six months, a move that may increase bidding interest in the upcoming spectrum auction.

If the Department of Telecommunications (DoT) approves the requests, the telcos will be allowed to offer 5G services on 4G spectrum bands such as 700 MHz or 800 MHz that also support the faster mobile standard and can be purchased in the March auction.

It's not clear when 5G airwaves in the 3,300-3,600 MHz bands will be auctioned. Both Airtel and Jio have written to reduce the pre-intimation notice period for a new service.

DoT is considering their requests and it is possible to reduce the notice period from one year to six months, said an official aware of the development.

Note that Jio has said it is 5G-ready and has developed its own eco-system that will make the telco a global 5G vendor.

Jio and Bharti Airtel are expected to be the major bidders in the spectrum auction. DoT aims to sell 2,250 MHz of 4G airwaves across seven bands from March 1, although it is yet to clear the air on when 5G airwaves will be auctioned.

The government may net Rs 400 billion from the auction in which airwaves worth Rs 3.92 lakh crore at the base price will be up for sale.

Jio is expected to spend Rs 200 billion, followed by Airtel, which is likely to spend Rs 100-150 billion in the auction.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.