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ICICIdirect Research Posted on 09:32am 09-Sep-2021

Central government is likely to discuss with state governments the inclusion of natural gas under the GST regime...

* Market Outlook

Indian markets are likely to open flat to negative on the back of mixed global cues, led by worries that the rapid spread of the Delta variant of Coronavirus could significantly slow down the pace of the global economic recovery.


*  Markets Yesterday

• Domestic markets ended flattish tracking gains in BFSI and metal stocks, which were partially offset by losses in IT, auto and pharma stocks.

• US markets ended lower on concerns over the spread of Covid-19 cases affecting the pace of the economic recovery.


* Key Developments

• Data released by the National Payments Corporation of India (NPCI) shows that of the 8.7 crore transactions initiated in August 2021, 32.98% transactions failed compared to 33.67% in July and 36.5% in June. This indicated directional recovery especially in retail portfolio.

• The Union Cabinet on Wednesday did not discuss and consider the relief package for the telecom sector, contrary to what was expected in media reports. According to The Economic Times, it may now be taken up for discussion and approval during one of the remaining Cabinet meetings this month. The Cabinet usually meets on Wednesdays.

• Infosys’ buyback committee has approved closure of the buyback with effect from September 8, 2021 as the company has bought back 99.99% of the maximum buyback size.

• The central government has appointed intermediaries - Kotak Mahindra Capital Company, Goldman Sachs India Securities, JP Morgan India, and others for listing and partial disinvestment its equity shareholding in Life Insurance Corporation of India (LIC) via an initial public offering.

• Canada Pension Plan Investment Board is selling 2.0 crore shares in SBI Life in an accelerated bookbuild offering, according to Bloomberg. Shares are being offered at | 1,159.05 to | 1,220.05 each, which is at a discount of 0-5% to Wednesday’s close. There is an option to increase the deal size by as many as 3 million shares.

• Jindal Steel and Power, through its step down subsidiary Jindal Steel & Power (Australia) Pvt Ltd has made a pre-payment of $105.66 million (~| 777.4 crore) The prepayment has helped reduce the Australian subsidiary debt by ~50%. The overseas debt is expected to be completely paid in upcoming quarters. As on Q1FY22, JSPL’s net debt was at | 15227 crore. JSPL is committed to becoming a net debt free company by FY23.

• According to Mint, ONGC is in discussions to acquire a minority stake in Sangomar oil project in Senegal from Woodside Petroleum. The project is of more than US$ 4 billion investment and ONGC is looking to acquire 20 - 40% interest in the oil field.

• According to media reports, the central government is likely to discuss with state governments the inclusion of natural gas under the GST regime.

• According to The Economic Times, the government is likely to ask promoters of IGL and Petronet LNG to make open offer to minority shareholders of these companies either in concert or in competition with strategic buyer of BPCL post privatisation.

• Crisil Ratings has revised its outlook on the long-term bank facilities of Vardhman Special Steels (VSSL) to ‘Stable’ from 'Negative' while reaffirming the rating at 'Crisil AA’. The rating on the short-term bank facility and debt programmes has been reaffirmed at 'Crisil A1+  Larsen & Toubro InfoTech (LTI) has informed the stock exchanges that NCLT, Mumbai Bench has approved the scheme of amalgamation between Syncordis Software Services India Pvt Ltd and Ruletronics Systems Pvt Ltd, wholly owned subsidiaries, with the company on September 6, 2021.

• Biocon has entered into a confidential settlement agreement with Celgene relating to patents for Revlimid (lenalidomide).

• The Multiplex Association of India (MAI), along with leading cinema chains PVR and INOX, on Tuesday urged the Maharashtra government to reopen theatres in the state on "urgent basis", claiming that the exhibition industry has suffered losses to the tune of | 4,800 crore.

• TCS has been selected by Avianca, one of the leading airlines in South America, as a strategic partner in its cloud transformation journey. TCS will modernise Avianca’s IT infrastructure and will help the airline to migrate 129 core applications to the cloud and will also manage the new cloud estate.

• Bank of Baroda has announced the launch of its digital banking platform 'BoB World', aimed at providing all banking services under one roof. The lender aims to provide an all-inclusive and seamless virtual banking experience, encompassing all digital banking services under one roof for the convenience of customers.


* Today’s Highlights

Events: EU deposit facility rate, India industrial production YoY, India manufacturing output, GDP trade balance, US PPI, GDP industrial production, GBP construction output.