RIL’s funding cost drops 42 bps
ICICI Bank emerges top holding at mutual funds
Bank Nifty may lag from here on
Reliance aims to grow retail arm 3 times in 5 years
Now lemme give you a quick glance on the state of the markets.
Dalal Street looked headed for a mild gap-up start this morning. Nifty futures traded some 16 points higher on the Singapore Exchange at 7 hours (IST). Other Asian markets opened in the green. Shares climbed in Japan, South Korea and Australia. In overnight trade, US shares hit a record on a bipartisan $579 billion US infrastructure deal that stoked economic optimism. Dow rose nearly 1%, the S&P500 half a per cent and the Nasdaq 0.69 per cent.
Elsewhere, the dollar held a retreat. The Mexican peso rallied, spurred by an unexpected central bank interest-rate increase. The pound edged lower. Bitcoin extended a rebound from a swoon earlier in the week. Benchmark US crude was headed for the longest run of weekly gains since December.
That said, here’s what is making news?
Funding costs for Reliance Industries, India’s biggest company by all conventional financial yardsticks, dropped 42 basis points in the past one year, with the decline in average cost of debt capital at the oil-to-retailing major far outpacing the reduction in broader market rates. A basis point is 0.01%. The average differential or spread of three-year RIL bonds with the sovereign benchmark slipped to 53 basis points from 95 bps in April last year, reflecting investor appetite for RIL debt, showed data compiled by JM Financial.
RBI has linked dividend payout to balance sheet parameters for financial companies. The new dividend distribution norms prescribed by the regulator apply to all finance companies, including core investment companies. The rules cap the maximum dividend payout ratio at 50% of net profit for all NBFCs, but allow a higher payout of 60% for core investment companies and primary dealership firms. Boards of NBFCs have been asked to factor in RBI’s observation during supervision and the notes to accounts before approving a dividend.
Traders carried forward a higher number of Bank Nifty futures than on Nifty to the July series on expiry of the June contracts. Analysts said the trend indicates that Bank Nifty might continue to underperform the Nifty. Foreign investors’ bullish bet rollovers were in line with that of the previous expiry, shrugging off uncertainties around the US Federal Reserve’s hawkish statement last week that has made the market undertone jittery. But, few want to bet against the market, which has stayed afloat thanks to flows from domestic investors.
RBI has allowed banks to recover part of gold metal loan advances in physical gold. Current regulations required lenders to recover gold loans dues in rupees equivalent to the value of the yellow metal borrowed. Banks that have got the permission to import gold and are participating in the gold-monetisation scheme are allowed to extend gold loans, which are availed by jewellers and exporters. The option will be available only for prospective borrowers.
LASTLY, Reliance Retail is set to grow three times in the next three to five years, said Reliance Industries chairman and MD Mukesh Ambani. The company, which operates several businesses across categories such as grocery, consumer electronics and pharma, continues to be among the fastest growing retailers in the world and aims to be among the top 10 globally, Ambani said at RIL’s AGM on Thursday.
NOW Before I go, here is a look at some of the stocks buzzing this morning…
LIC will infuse equity capital worth about Rs 2,334.70 crore in its subsidiary LIC Housing Finance by picking up an additional stake in the company.
The Adani Group will export the first coal from its Australian mining project this year, riding out a series of lawsuits and public litigation initiated by environmental activists.
Gammon Infrastructure, currently under a liquidity squeeze, is seeking to divest nearly half its stake in Vizag Seaport
State-owned Indian Bank has raised Rs 1,650 crore by selling shares to institutional investors at Rs 142.15 apiece, the bank said in a regulatory filing.
The Mumbai bench of the National Company Law Tribunal directed Reliance Home Finance to repay its debt obligations to nearly 19,000 debenture holders in the next five months.
Do also check out over two dozen stock recommendations for today’s trade from top analysts on ETMarkets.com.
That’s it for now. Stay put with us for all the market news through the day. Happy investing