Today’s Latest Business News, Finance and Share Market News at 10:00 am on 20 December 2023

Let's begin - GIFT Nifty traded up by 86.50 points or 0.40% at 21,614.50, indicating a positive opening for domestic indices NSE Nifty 50 and BSE Sensex on Wednesday. Previously, on Tuesday, the NSE Nifty 50 gained 34.45 points or 0.16% to settle at 21,453.10, while the BSE Sensex ended higher by 122.10 points or 0.17% to 71,437.19. The stocks to watch out for today are Bharat Petroleum, IT Companies, Rail Vikas Nigam Limited, Nippon India, JK Tyre, DOMS, Glenmark Life Sciences and India Shelter.

Up next - In order to prevent possible evergreening of loans via investments in schemes of alternative investment funds, the RBI on Tuesday tighthened norms for lenders. It said while regulated entities make investments in units of AIFs as part of their regular investment operations, it has come to the regulator’s notice that certain transactions were not in line with regulatory norms. The norms are applicable to all commercial banks, including small finance banks, local area banks, regional rural banks, co-operative banks, non-banking financial companies and financial institutions. According to Veena Sivaramakrishnan, partner at Shardul Amarchand Mangaldas & Co, while it is usually rare for RBI to call out specific structures, it does not necessarily come as a surprise as the central bank has always been concerned with hidden bad loans and evergreening as a principle.

In other developments - Essar group’s IT solution provider Black Box aims to double its revenue to $2 billion in the next three years, said president and CEO of Black Box Sanjeeb Verma, in an interaction with FE on Tuesday. Currently, the company is seeing an annual revenue run rate of about Rs 7,000 crore. It is looking to increase its margin to 10% over the next few quarters. In the second quarter, the company’s Ebitda margin was at 6.4%. In 2019, AGC Networks acquired the IT solution provider and in 2021, renamed it Black Box. The company is headquartered in Texas but is also listed in India.

Moving on - Paddy procurement under the minimum support price scheme declined 13% on year to 36.54 million tonne so far in the current season, with farmers in Chhattisgarh and Telangana holding on to stocks in anticipation of receiving bonus over MSP. On the hustings, the BJP which returned to power in Chattisgarh after recent assembly elections promised a procurement price of Rs 3100/quintal for paddy, including bonus, against MSP of Rs 2,183. The Congress which won in Telangana also hinted at bonus over paddy MSP. Sources said the slowdown in procurement is mainly due to sharp fall in purchases by the Food Corporation of India and state governent agencies from farmers in Chhattisgarh and Telangana although purchases in Punjab and Haryana have been robust.

Meanwhile - EbixCash on Tuesday announced that its operations in India will not be affected by the Chapter 11 process in the US. The company in a statement said that, quote-unquote, "The Chapter 11 proceedings apply to Ebix entities in the US only and Ebix’s approximately 200 affiliates outside the US are not included in the US-only Chapter 11 filing and will continue to operate normally." EbixCash companies in India, besides all international subsidiaries and their franchisees around the world are not included in the Chapter 11 filing. The company has strong standalone financials and governance, with its cash flows solely available for its own needs. Chapter 11 process mandates insulation between the international companies and the US company in terms of any intercompany dealings.

In other news - Dismissing the International Monetary Fund's assessment that the Reserve Bank of India probably made excessive intervention in the foreign exchange market to influence the level of the rupee in the nine months to October, the central bank stated that the Fund’s view is “incorrect” and resulted from selective use of data. The IMF’s views and the RBI’s reaction to them are narrated in the Fund’s annual Article IV country report for India released on Tuesday. Though dialogues between a country’s fiscal and monetary authorities and the Fund are usually chronicled in the Article IV report that seeks policy transparency, such strong exchange of views seldom make it into it.

Lastly - The Indian used-car market is set to leap from a value of Rs 2.1 trillion in FY23 to Rs 5 trillion by FY28, and a volume increase from 4.6 million units in FY23 to 8.5 million units in FY28, growing at a value-CAGR of 18% and volume-CAGR of 13%, respectively, according to the OLX Mobility Report. Siddharth Agrawal, country head, marketing, OLX India, told FE that contrastingly, the new-car market, despite achieving a historic 27% growth in FY23 with 3.9 million units sold, anticipates a moderated growth pace of 6-8% in FY24. Agrawal added that the rise in sales of pre-owned utility vehicles is propelling this growth.

Click to listen to yesterday evening’s bulletin