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Indian banks are expected to have steady growth in earnings and returns over the next 3–4 years, according to a recent report by Jefferies. It expects a 13% compound annual growth rate (CAGR) in loan growth for banks between FY24 and FY27, helmed by a supportive environment and expected adjustments in interest rates. "We expect steady growth in earnings and stable returns, Over FY24-27, the banks we cover should see 13% CAGRin loans We factor 25-50 bps cut in rates, &amp; depending on timing, NIMs will move," the report said. Depending on the timing, these rate cuts could impact banks' <keyword id="20076541" type="General" weightage="20" keywordseo="net-interest-margins" source="keywords">net interest margins</keyword> (NIMs), which measure the difference between interest income generated and interest paid to depositors. The report also notes that banks' net interest income (NII), a critical metric that is reflective of how much a bank earns from its lending, could grow at a steady 12% CAGR, which would support overall earnings growth. <h2>Rate cuts probable next year</h2>Per SBI Mutual Fund's monthly outlook for November 2024, while markets were initially speculating possible rate reductions in December this year or February next year these chances now stand dampened due to two reasons. First, elevated CPI numbers in September, which stood at a nine-month high, underlined the stickiness of food inflation. Secondly, RBI governor Das recently highlighted his hawkish stance at a conference, stating that "rate cuts at this stage would be premature and risky’. The report further adds that February 2025, or even April, would be a better time to discuss repo rate cuts in India. Even <keyword id="19985925" type="General" weightage="20" keywordseo="bank-credit-growth" source="keywords">bank credit growth</keyword> has continued to outpace deposit growth for two years now. However, they seem to be inching closer in the recent past. For instance, in October 2024, while bank credit growth remained at 12.7%, the deposit growth rate followed closely at 11.8%. This also means that banks are witnessing an elevated bank credit-to-deposit ratio, standing at 77% in October. <h2>Risks in unsecured lending </h2>However, Jefferies noted some areas of caution that could influence growth in other revenue streams, particularly fees. Growth in fees may be at risk due to expected declines in the disbursal of unsecured loans, which generally carry higher interest rates and generate higher fees for banks. October saw stress and defaults rising in the unsecured lending space, prompting the RBI to intervene. As a result, unsecured loans by banks have only grown by 12.1%, the lowest since the pandemic. Despite these risks, the report expects banks' return on assets (ROA) and return on equity (ROE) to remain healthy, underscoring the sector's stable profitability potential. The report also highlights that while the Nifty Banks index has risen by 19% over the past year, it has still underperformed the broader Nifty index, which delivered 27% returns in the same period. BSE Bankex has been along similar lines, generating returns worth 19% over one year. While the Nifty banks' index has a YTD (yield to date) of 7.63%, it continues to trail Nifty's YTD of 11.30%

Indian banks to have steady growth in earning over next 3-4 years, fees from unsecured lending may dip, notes Jefferies report

New Delhi: The adoption of <keyword id="20643295" type="General" weightage="100" keywordseo="Electric-two-wheeler" source="keywords">electric two-wheeler</keyword> vehicles in <keyword id="19895063" type="General" weightage="20" keywordseo="India" source="keywords">India</keyword> is on a gradual rise and it is expected that their share will rise to upwards of 13 per cent by 2026-27, investment banking company <keyword id="19905137" type="General" weightage="20" keywordseo="Jefferies" source="keywords" meta.keywordsubtype="org" meta.entityname="Jefferies" meta.hostid="261" meta.entityid="Jefferies">Jefferies</keyword> asserted in a report. In the financial year that ended in March 2024, the share of electric two-wheelers was at 5 per cent. Share of EVs in two-wheeler sales rose from just 0.4 per cent in 2020-21 to 5.4 per cent by early 2023, led by rising subsidies and new launches. However, Jefferies claimed that a subsequent reduction in incentives has resulted in the share remaining in the 4-7 per cent range for most of the past 24 months, despite the introduction of lower-priced vehicles by manufacturers. "We currently assume share of E2Ws rising from 5 per cent (0.9mn units) in FY24 to 7 per cent/10 per cent/13 per cent (1.4mn/2.3mn/3.4mn units) in FY25E/FY26E/FY27E, although we now see a downside risk to these estimates in the context of the new scheme targeting just 2.5mn E2Ws over two years," Jefferies said in its report released earlier this week. <keyword id="19897349" type="General" weightage="20" keywordseo="Ola-Electric" source="keywords" meta.keywordsubtype="org" meta.entityname="Ola Electric" meta.hostid="261" meta.entityid="Ola Electric">Ola Electric</keyword>, which has recently become a publicly listed company, has emerged as the dominant manufacturer in India's electric two-wheelers market, said Jefferies, noting that its market share rose from 21 per cent in 2022-23 to 35 per cent in 2023-24 and further to 49 per cent in 1Q-2024-25. However, as per the Jefferies report, Ola's market share has subsequently fallen to 31 per cent in August and just 29 per cent in September (month-to-date). Bajaj, TVS and Ather, on the other hand, have gained 5-9 percentage points each since June quarter, it said. This week, the Union Cabinet has approved a scheme for the promotion of electric mobility in the country. The scheme has an outlay of Rs 10,900 crore over two years. The Cabinet's approval for the 'PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme' was based on a proposal from the Ministry of Heavy Industries (MHI). Among others, subsidies or demand incentives worth Rs 3,679 crore would be provided to incentivise e-2Ws, e-3Ws, e-ambulances, e-trucks and other emerging EVs. The scheme will support 24.79 lakh e-2Ws, 3.16 lakh e-3Ws, and 14,028 e-buses, a release said. The Ministry of Heavy Industries is also introducing e-vouchers for EV buyers to avail of demand incentives under the scheme.

Electric two-wheeler adoption in India rising, 13% share expected by 2026-27: Jefferies

<ul class="summary-list"><li>The iPhone 16 lacks new features and a new AI smartphone is years away, wrote analysts on Sunday.</li><li>Apple's stock fell 2.3% after Jefferies cut its rating from buy to hold.</li></ul>One group of analysts finally said what even some of Apple's fans have been thinking: The iPhone 16 <a target="_blank" class="" href="https://www.businessinsider.com/apple-iphone-16-with-ai-seems-boring-could-be-good-2024-9">was underwhelming</a>, and it will take a while before a real AI smartphone is ready.In a note on Sunday, analysts at Jefferies said that the <a target="_blank" class="" href="https://www.businessinsider.com/apple-events">iPhone 16's </a>lack of new features and limited AI coverage mean that it might not sell as well as other analysts hope. They added that an AI-capable smartphone is another two to three years away."To expect an accelerated smartphone replacement cycle now due to AI is premature," analysts led by Edison Lee wrote. The firm cut <a target="_blank" class="" href="https://www.businessinsider.com/apple">Apple's </a>rating from a buy to a hold recommendation.The<a target="_blank" class="" href="https://markets.businessinsider.com/stocks/aapl-stock"> iPhone maker's stock </a>fell 2.3% on Monday following the note.IPhone sales are a closely-tracked metric because they make up about half of the company's total revenue.Much of the optimism surrounding Apple this year came from its June announcement of <a target="_blank" class="" href="https://www.businessinsider.com/apple-apple-intelligence-delaying-iphone-16-china-2024-7">Apple Intelligence</a>, the company's take on artificial intelligence. The smartphone maker's stock has rallied over 30% in the last six months, in part over AI excitement.But the fanfare surrounding the new technology dimmed in July, when Bloomberg reported that the new <a target="_blank" class="" href="https://www.businessinsider.com/apple-intelligence-delay-wont-hurt-new-iphone-sales-analysts-2024-7">iPhone 16 would not come with Apple Intelligence.</a> Instead, users would have to wait for <a target="_blank" class="" href="https://www.businessinsider.com/apple-intelligence-abilities-questioned-2024-8">AI features,</a> which include an AI-powered Siri and an image generator, to be released through several software updates starting in October.In Sunday's note, Lee forecasted "flattish volume growth" in the second half of 2024 for iPhone 16 compared to the iPhone 15, and only 2.5% growth in lifecycle volume for the iPhone 16.To be sure, not all analysts think the delay in introducing Apple Intelligence will hurt the company. Some say it's a small part of the overall product lineup."It's like trying to weigh an elephant by a few of its hairs," Gil Luria, an Apple analyst for D.A. Davidson,<a target="_blank" class="" href="https://www.businessinsider.com/apple-intelligence-will-drive-sales-for-iphone-16-analysts-say-2024-9"> told Business Insider last month.</a> He said that he gives little credence to third-party reports of iPhone 16 sales.Even Jefferies' Lee wrote that AI in the iPhone has potential, just not in the short run.He wrote that Apple "is the only hardware-software integrated smartphone player" and that he is excited about its long-term AI capabilities.He estimated that the company would have 490 million AI-capable iPhones by 2026, and 845 million by 2027. Apple sold 45.5 million phones in the three months ending in June, according to Counterpoint research data.In October, 32 of the 38 analysts who covered Apple had a Buy rating on the company.

Real AI smartphones are still a few years away, say Jefferies analysts

The <keyword id="22902068" type="General" weightage="100" keywordseo="health-insurance-sector" source="keywords">health insurance sector</keyword> may face challenges in the coming months, due to <keyword id="20617555" type="General" weightage="20" keywordseo="rising-claims" source="keywords">rising claims</keyword> and increased competition, particularly in the retail sector, highlighted a report by <keyword id="19905137" type="General" weightage="20" keywordseo="Jefferies" source="keywords" meta.keywordsubtype="org" meta.entityname="Jefferies" meta.hostid="153" meta.entityid="Jefferies">Jefferies</keyword>. "Health (approx. 35% of mix) can see pressure in its retail segment from rising claims frequency and elevated competition" the report stated. The report indicated that <keyword id="19895063" type="General" weightage="20" keywordseo="India" source="keywords">India</keyword>'s <keyword id="22461357" type="General" weightage="20" keywordseo="non-life-insurance" source="keywords">non-life insurance</keyword> sector is experiencing significant shifts, the health insurance segment may face challenges as healthcare costs continue to rise and more consumers claim their insurance, and insurers are grappling with increased payouts. This trend could squeeze margins and put pressure on insurers to find ways to manage costs while remaining competitive in the market. However, for the <keyword id="20224622" type="General" weightage="20" keywordseo="motor-insurance" source="keywords">motor insurance</keyword> segment, the report draws a promising picture and added that it is entering a promising multi-year upcycle. This positive momentum is expected to benefit large private insurers of the motor segment, who are well-positioned to capitalize on these trends. "Initiate on Non-Life Insurers Large private insurers are set to gain from multi-year upcycle in motor (approx. 35% of premium mix) led by <keyword id="21232881" type="General" weightage="20" keywordseo="premiumization" source="keywords">premiumization</keyword> of underlying auto mix and moderating competitive intensity" the report mentioned. The report also added that the motor insurance segment in India is estimated to grow at a compound annual growth rate (CAGR) of 14% over the financial years 2024 to 2027. The key driver behind this growth is the ongoing shift in the automobile market towards higher-value vehicles. Over the past three years, the average selling price (ASP) of passenger vehicles (PVs) has increased by 41%, reflecting a move towards premium segments. This trend is expected to continue, benefiting motor insurance renewals, which account for 60-70% of the motor insurance premium mix. "Motor segment amidst a multi-year upcycle (est. 14% CAGR over FY24-27E) as renewals (60-70% of premium mix) will continue to benefit from the underlying change in auto mix towards premium high-value segments" the report added. Despite these challenges, the report mentioned that the broader non-life insurance market in India remains significantly underpenetrated, with insurance premiums representing only about 1% of the country's <keyword id="19904293" type="General" weightage="20" keywordseo="GDP" source="keywords">GDP</keyword>. This is relatively low compared to global peers, where non-life insurance to GDP ratios range between 2% and 4%. However, the Indian non-life insurance market has shown steady growth, with gross premiums expanding at a CAGR of 12% over the past five years, reaching Rs 2.8 trillion (approximately $35 billion). Notably, the private sector has outpaced the overall market. "India remains an under-penetrated market with non-life insurance to GDP at approx. 1% (vs 2-4% for global peers). Gross premiums have expanded at 12% CAGR over the last 5 years to Rs 2.8tn (approx. $35bn) with the private sector growing faster at 15% CAGR and improving its market share to 68%(from 57%)" said Jefferies in the report. Despite these challenges, the overall insurance market in India remains underpenetrated, offering significant long-term growth potential for insurers who can navigate these dynamics effectively.

Rising claims pose challenge for health insurance sector in India, says Jefferies

<ul class="summary-list"><li>Jefferies hosted a conference to bring together late-stage tech founders, investors and bankers.</li><li>At the conference, there was talk of IPOs and M&amp;A being back.</li></ul>As bankers and venture capitalists nibbled on caviar sushi and sipped champagne and sake this week at Nobu Malibu, there was a gleeful mood at the beachside closing dinner of the Jefferies Private Internet Conference.IPOs and M&amp;As are finally back, and on top of that, there is an exciting new catalyst for rising tech valuations — generative AI."We surveyed a lot of the 140 entrepreneurs that are coming here and found 'IPO' is not a dirty word anymore," said Cameron Lester, Co-Head of Technology, Media and Telecom Investment Banking at Jefferies. "People are thinking maybe they will go public."After a Covid pause, Jefferies resumed this conference in 2022 to bring together late-stage tech founders, investors, and bankers. But there was not much to talk about in the way of actual deals. Now the logjam is finally breaking."We're as busy today as we were in 2021," said Jason Greenberg, Co-Head of Global Technology, Media, and Telecom Investment Banking at Jefferies."We ultimately succeed and get paid on the success of deals happening and closing. I don't think as many deals we're on today will turn into announced deals in 2024 or early 2025 compared to 2021. But even if they don't close at the same rate, you're going to see a market that was down 60% peak to trough recover a lot."AI is driving many of those deals, according to Greenberg; The theme of this year's conference was "In the Age of AI.""Beyond typical deal considerations, AI has emerged as the single biggest new influence today in tech M&amp;A," according to Greenberg.Reports that Salesforce <a target="_blank" href="https://markets.businessinsider.com/news/stocks/salesforce-s-strategic-and-financially-sound-acquisition-of-informatica-backed-by-analyst-s-buy-rating-1033255009">is in talks</a> to buy the $10 billion data management software firm Informatica is another sign dealmaking is back (though some people at the conference were skeptical the deal would ultimately go through).This week, there was also promising news that Goldman Sachs reported its investment banking division saw fees rise 32% in the first quarter thanks to strong underwriting and advisory work growth."It's clear that we're in the early stages of a reopening of the capital markets," said David Solomon, the bank's chairman and CEO, told investors.Reddit went public in March, though the stock is down from its opening price. <a target="_blank" href="https://www.businessinsider.com/the-11-startups-most-likely-to-ipo-in-2024-2024-3#epic-games-2">Other companies in the IPO pipeline include Databricks. Epic Games, and Getir.</a><div type="image" title="Marc Andreessen speaks at the Jefferies Private Internet Conference 2024" height="1391" width="2048" msid="109431736" hostid="261"></div>Aside from the lavish Nobu dinner, attendees at Jefferies also heard from Andreessen Horowitz cofounder Marc Andreessen and Anthropic's head of business development, Neerav Kingsland.Jefferies has significantly bulked up its tech investing division to better compete against more established players like Goldman and JP Morgan Chase."In the last 18 months, we've increased the number of MDs [managing directors] in our investment bank by 70%, which is kind of crazy given what's happened to our industry in terms of the decline over the past couple of years," Lester said.Now that deals are finally happening again, Lester is hoping the investment pays off."People don't typically choose a banker in a 30-day period," Lester said. "They choose it based on relationships built over a couple of years."

Caviar, champagne, and IPOs: At the Jefferies Private Internet Conference, tech dealmaking was back

<ul><li>Two wheeler sales are expected to grow at 15% for next two years, outpacing PVs.</li><li>Sales of 2Ws have been lagging behind PV sales for the last three years.</li><li>Margins of 2W companies are also expected to improve due to moderating metal prices, strong demand. </li></ul>Two wheeler sales are expected to see double digit growth for the next two years, outpacing passenger vehicles, says a report by <keyword id="19905137" type="General" weightage="20" keywordseo="jefferies" source="keywords">Jefferies</keyword>. Two wheelers are expected to grow at a 15% compounded annual growth rate (CAGR) while passenger vehicles and trucks are expected to grow at 7-8% CAGR. The research firm also believes that tractors are at the risk of a downturn after an elongated up-cycle. Their volumes are expected to fall by 9% FY24 and 5% in FY25, followed by a recovery in FY26. Amidst a mixed auto picture, two-wheelers are the preferred picks. “We enter 2024 reiterating our positive view on Indian autos with preference for two-wheelers. After the strong 2023 rally in autos, valuations are not cheap, but we believe premium multiples are justified in most cases for the strong growth outlook and company-specific positives,” said Jefferies. Its preferred buys are <keyword id="20036540" type="General" weightage="20" keywordseo="tvs" source="keywords">TVS</keyword> and Eimco Elecon, followed by <keyword id="19906967" type="General" weightage="20" keywordseo="tata-motors" source="keywords">Tata Motors</keyword>, Bajaj Auto and <keyword id="19983534" type="General" weightage="20" keywordseo="hero-motocorp" source="keywords">Hero Motocorp</keyword>. It also has buy ratings on Maruti and AL, but they’re lower in its pecking order. Turning tide: Sales &amp; profitability Jefferies believes that the tide has now turned for two wheelers after stressful pandemic years. The sales of two wheelers have been lagging behind passenger vehicles (PVs) for the last three years. “Compared to the respective FY19 peaks, FY23 volumes were 23% lower for 2Ws but 15% higher for PVs,” said Jefferies. In 2023, 2Ws started charting their recovery, and grew at 9.5% as compared to 11% growth seen in PVs, as per data by Federation of Automobile Dealers Associations (FADA). Experts also surmise that the year of 2024 will see a boost for two wheelers. “The two wheeler sector expects a boost from new model launches, especially in the first half of the year, and an overall better economic condition coupled with higher EV participation. Improved customer sentiments, due to factors like lower fuel prices and crop payments to farmers, are likely to drive demand,” said <keyword id="20117944" type="General" weightage="20" keywordseo="manish-raj-singhania" source="keywords">Manish Raj Singhania</keyword>, president of FADA in 2024 outlook. Improved margins; EV consolidation Strong demand and new launches are also expected to yield good margins for two-wheeler automakers. They have been stressed between FY21 and FY23 on weak demand as well as a rally in steel and aluminum prices. Commodity prices have turned benign since then which is expected to add to two-wheeler profitability along with sales. “Auto OEM margins are on an improving trajectory as rising demand is boosting pricing power and providing operating leverage benefit, amid a benign commodity price environment,” said Jefferies. Electric vehicle sales are also expected to push for more sales in the two-wheeler category in the coming year. As of the second half of 2023, EVs made up for 5% of the market. “While the reduction in EV subsidies in June 2023 has slowed down the pace of 2W electrification, tighter regulations and lower subsidies are driving consolidation,” opined Jefferies. Top four original equipment manufacturers hold around 80% market share in electric two-wheelers. In the ICE market, the top four players hold 86% of the market share. Two wheeler HHI (Herfindahl–Hirschman Index) is also converging with ICE, which should ease concerns on long-term profitability, says Jefferies. HHI is a measure of market concentration used to determine competitiveness in the market.

India’s auto sales to ride on two wheels in 2024

<ul class="summary-list"><li><a target="_blank" href="https://www.businessinsider.com/tech-job-cuts-january-make-failed-logins-scarier-2024-1">Tech layoffs</a> have swept the nation since the start of 2024, with over 34,000 workers laid off. </li><li>The layoffs aren't ending anytime soon, according to a Jeffries analyst. </li></ul>It may seem like tons of tech companies are laying off employees this year.Well, that's because they are — and they're showing no sign of stopping, according to a Jefferies analyst. "The lay-offs are going to continue and it may get worse. It's become contagious," Brent Thill said in an interview with <a target="_blank" href="https://www.ft.com/content/9bace2e9-3ecb-4651-a6c0-b16f0226c0e0">FT</a> published Sunday.Google CEO Sundar Pichai already warned staff that more layoffs are coming in a staff email last month, after several hundred layoffs so far this year.Over 140 tech companies have cut staff, totaling 34,250 layoffs since the start of 2024, according to tech-layoff tracker <a target="_blank" href="https://layoffs.fyi/">Layoffs.fyi</a>.While that may sound like a high number, it pales in comparison to last February, when tech companies cut a total of 140,000 workers as the industry grappled with pandemic-era overhiring.This year, fewer employees were impacted, but the layoffs feel never-ending as tech giants like Amazon and Google consistently make small cuts in different sectors. <a target="_blank" href="https://www.theverge.com/2024/1/17/24042417/google-layoffs-2024-internal-employee-memo-sundar-pichai#:~:text=Google%20has%20laid%20off%20over,that%20was%20shared%20with%20me.">Amazon</a><a target="_blank" href="https://www.businessinsider.com/amazon-layoffs"> had layoffs this year in its</a> Buy with Prime department, along with Prime Video, and Amazon MGM Studios.Amazon employees are now bracing for more layoffs after news broke that as many as <a target="_blank" href="https://www.businessinsider.com/amazon-one-medical-pharmacy-layoffs-broader-cost-cutting-campaign-2024-2">several hundred jobs will be cut</a> from One Medical and Amazon Pharmacy.Additionally, Google cut several hundred roles across various teams this year, including Assistant, knowledge and information product teams, the hardware team, and central engineering.A Google spokesperson said the company is investing in its "biggest priorities and the significant opportunities ahead." Google is continuing to support impacted employees as they look for new roles at the company, according to the statement.January layoffs are common, but many of these cuts appear different because <a target="_blank" href="https://www.businessinsider.com/layoffs-happening-at-tech-firms-that-are-doing-just-fine-2024-2">companies that seem to be d</a><a target="_blank" href="https://9to5google.com/2024/01/10/google-reorganizing-hardware/">oing well,</a> like Microsoft and Meta which have launched major AI platforms and recently reported their highest earnings, are also partaking in staff cuts.Microsoft cut 1,900 roles in its gaming division this January despite reporting record-breaking revenue for its final quarter of 2023.Microsoft Gaming CEO Phil Spencer said that the layoffs were part of a greater "execution plan" to reduce overlap within the company, <a target="_blank" rel="nofollow noopener" class="link " href="https://www.cnbc.com/2024/01/25/microsoft-lays-off-1900-workers-nearly-9percent-of-gaming-division-after-activision-blizzard-acquisition.html">CNBC reported</a>.According to the FT report on Sunday, companies may be continuing to make cuts so that they can invest in new areas, like generative AI. Additionally, tech companies might want to show investors that they're focusing on cost discipline, per the same report.For companies like Meta, this tactic seems to be working.Meta announced additional cuts in January after reducing its staff by <a target="_blank" href="https://www.businessinsider.com/meta-layoffs-office-closures-stock-price-mark-zuckerberg-earnings-2024-2">22% over the last year</a>. The decision to do so sent their stocks up by 12% to $450 a share at its peak in January.Even though Meta said it was done with layoffs in 2023, CEO Mark Zuckerberg has labeled 2024 as the '"year of efficiency" and has already <a target="_blank" href="https://www.businessinsider.com/meta-layoffs-tpm-roles-instagram-job-cuts">eliminated a manager role at Instagram</a> with more in that role expected.The strategy may even lead to a revival of the Metaverse, which was previously viewed <a target="_blank" href="https://www.businessinsider.com/metaverse-dead-obituary-facebook-mark-zuckerberg-tech-fad-ai-chatgpt-2023-5">as a failure in the tech world.</a>

The layoffs sweeping tech companies are 'contagious' and 'may get worse,' Jefferies analyst predicts

Stock <keyword id="20345915" type="General" weightage="20" keywordseo="exchanges" source="keywords">exchanges</keyword> and <keyword id="20710434" type="General" weightage="20" keywordseo="brokers" source="keywords">brokers</keyword>, catering to retail traders, could be hit hard by the regulator <keyword id="19901201" type="General" weightage="100" keywordseo="Sebi" source="keywords">SEBI</keyword>'s proposed measures for Futures &amp; Options (F&amp;O) <keyword id="22748189" type="General" weightage="20" keywordseo="trading-regulations" source="keywords">trading regulations</keyword>, with market volumes slumping 30-40 %, according to reports. If these measures are implemented, the number of investors could decrease, it added. Moreover, discount brokers, who depend heavily on retail investors, are expected to be more affected than traditional full-service brokers. SEBI, in its consultation paper in July, proposed seven measures, including increasing minimum contract size and upfront collection of option premiums, intra-day monitoring of position limits, rationalisation of strike prices, removal of calendar spread benefit on expiry day and increase in near contract expiry margin. SEBI stated that these measures are aimed at enhancing <keyword id="20775670" type="General" weightage="20" keywordseo="investor-protection" source="keywords">investor protection</keyword> and promoting <keyword id="20813757" type="General" weightage="20" keywordseo="market-stability" source="keywords">market stability</keyword> in derivative markets. According to a report by Jefferies, SEBI's proposed measures to reduce the number of weekly option contracts from 18 to 6 could impact around 35% of industry premiums. However, if trading shifts to the remaining contracts, the overall impact can be reduced to 20-25%. Among its 7 proposed measures, IIFL Securities see the highest impact from the withdrawal of <keyword id="22353333" type="General" weightage="20" keywordseo="weekly-options" source="keywords">weekly options</keyword> (only 1 per exchange allowed) as index Options account for 98% of the volumes. IIFL Securities expects the National Stock Exchange (NSE) to be more affected than the BSE because 60 % of NSE's revenue comes from options trading, compared to 40% for BSE. It estimates that by the financial year 2026, NSE's earnings could be reduced by 25-30% while BSE's earnings could drop by 15-18%. Jefferies also believes that the removal of Bankex weekly contract can impact BSE's earnings per share (EPS) by 7-9% over FY25-27. It further said that BSE might see a small decline in earnings, but if trading activity shifts from discontinued products, it could offset the impact or even lead to earnings growth. "We don't see any impact on MCX from these regulations. Within the value chain, discount brokers are likely to be more impacted than traditional full-service brokers given the former's dependence on retail investors," IIFL Securities said. Jefferies believes that clearing members like Nuvama, which caters to institutional players High-Frequency Traders (HFTs), and Foreign Portfolio Investors (FPIs) are less impacted. Rationalizing weekly options to only one benchmark index per exchange will significantly affect the NSE because it currently has four weekly index expiries, with "Bank Nifty" being the most important, contributing to 50 % of its options volume. The change could reduce NSE's overall trading volumes by 30-35 %, IIFL Securities said. On the other hand, BSE is expected to be less affected since it only has two contracts, with Sensex making up 85 % of its volumes in FY24. Even if "Bankex" contributes 30% by FY26, the impact on BSE's volumes is expected to be smaller compared to NSE, it said. Additionally, with just two expiries, BSE might gain market share and experience higher trading volumes, resulting in an estimated 20 % reduction in its overall volumes, it added. Jefferies said that SEBI's proposed measure of increasing lot sizes by 3-4 times over six months could lead to higher costs for retail traders, potentially reducing their participation in the market. The proposed margin increase for options sellers close to expiry could reduce leverage and profitability, especially for retail traders with limited funds. "Finally other measures like increasing ELM (extreme loss margin) around expiry, and withdrawal of calendar spread margin on expiry will increase the margin requirements and thereby could impact the liquidity. Based on our initial estimates we expect a 30-40 % impact on market volume," IIFL Securities said. SEBI Chief Madhabi Puri Buch recently mentioned that households are losing up to Rs 60,000 crore a year in the problematic futures and options segment. Earlier, SEBI research showed retail traders lose money in nine out of 10 trades in the F&amp;O segment Last month, the government in the Union Budget raised the securities transaction tax (STT) on both futures and options trade from October 1 to allay concerns about hyperactive interest in the derivative segment. Before that, the Economic Survey flagged concerns over rising retail investors' interest in derivative trading. The survey stated that speculative trade has no place in a developing country. It also pointed out that the sharp increase in retail investor participation in F&amp;O trading is likely driven by humans' gambling instincts.

SEBI proposed F&O norms to hit exchanges, brokers, says reports

<ul><li><keyword id="17888391" type="General" weightage="20" keywordseo="jiobharat" source="Orion">JioBharat</keyword>'s competitive pricing and decent device quality are expected to attract existing feature phone users. </li><li><keyword id="6354287" type="General" weightage="20" keywordseo="bharti-airtel" source="Orion">Bharti Airtel</keyword> may experience voice subscriber churn of approximately 17 million by March 2026. </li><li>Analysts at Jefferies Equity Research maintain a BUY rating with a revised price target of ₹1,020. </li></ul>Back in September 2016, Reliance <keyword id="2003276" type="General" weightage="20" keywordseo="jio" source="Orion">Jio</keyword> disrupted the Indian telecom market when it launched its mobile telephony and data services. Cut to 2023 and Jio is set to disrupt the market again with JioBharat the cheapest <keyword id="122479" type="General" weightage="20" keywordseo="4g" source="Orion">4G</keyword> feature phone priced at ₹999. Analysts at Jefferies Equity Research while analysing the impact of the launch, believe that over the next few years this will hit Bharti Airtel, its biggest competitor, with a potential 1-4% reduction in their India-mobile subscribers. <cmsannotation type="cmsannotation" annotationid="Jio expected to gain market share" comment="subhead" text="Jio expected to gain market share">Jio expected to gain market share</cmsannotation> JioBharat's competitive pricing and decent device quality are expected to attract existing feature phone users. Those nearing the end of their device life could potentially save 26% on their overall mobile expenses (device + service) by switching to JioBharat. However, users who are content with their current handsets may not switch. As a result, JioBharat is estimated to have an annual addressable market of approximately 60-65 million users. Based on this, the report anticipates Reliance Jio gaining around 55 million subscribers by March 2026. <cmsannotation type="cmsannotation" annotationid="Airtel’s subscriber estimates lowered" comment="subhead" text="Airtel’s subscriber estimates lowered">Airtel’s subscriber estimates lowered</cmsannotation> Bharti Airtel currently has around 130 million active 2G subscribers and over 100 million paying voice subscribers, giving it a substantial 40-50% share in the 250 million <keyword id="8627917" type="General" weightage="20" keywordseo="feature-phone" source="Orion">feature-phone</keyword> market. Despite having a better <keyword id="6359918" type="General" weightage="20" keywordseo="network" source="Orion">network</keyword> compared to other 2G operators, its dominant position in the feature-phone market may result in higher subscriber losses. As a consequence, the report projects Bharti Airtel to experience voice subscriber churn of approximately 17 million by March 2026, leading to a potential 1-4% reduction in their India-mobile subscriber estimates for the fiscal years 2024 to 2026. <cmsannotation type="cmsannotation" annotationid="What else is affecting Bharti Airtel’s growth?" comment="subhead" text="What else is affecting Bharti Airtel’s growth?">What else is affecting Bharti Airtel’s growth?</cmsannotation> Jio's focus on subscriber gains through network capacity additions and JioBharat launch may delay tariff hikes. Tariff hike assumptions are adjusted from 15% by end of calendar year 2923 to 20% in Q2 FY2025, resulting in a 3-5% cut to FY2024-2025 India Mobile average revenue per user (ARPU) estimates. The recent 68% devaluation of Nigerian Naira vs USD affects Bharti Airtel's Africa growth until Q1 FY2025, leading to a 17-21% reduction in Africa revenues and Ebitda. The market value of Airtel Africa has also corrected by 15% due to the Naira devaluation. <cmsannotation type="cmsannotation" annotationid="BUY rating maintained" comment="subhead" text="BUY rating maintained">BUY rating maintained</cmsannotation> Considering the delay in tariff hikes and the potential subscriber churn due to JioBharat, the analysts have revised their FY2024-2026 India revenue/ EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) estimates for Bharti Airtel, reducing them by 2-5%. However, it is still anticipated that Bharti Airtel will achieve strong growth with 15-16% CAGR in India revenue and EBITDA over FY 2023-2026, along with improving return on capital employed (ROCE) and generating more free cash flow. Furthermore, the impact of JioBharat may accelerate the move towards a duopoly in the market, leading us to raise the target enterprise value (EV)/EBITDA for India to 10x (in line with the 5-year average). So the analysts maintain a BUY rating with a revised price target of ₹1,020. The BUY rating is based on a favourable risk-reward scenario at the current price levels. Key factors contributing to this recommendation are Bharti's significant share gain in 4G subscribers, their intention to increase ARPU, and an optimistic tariff outlook driven by the government's stake in the stock. These factors align to present a compelling case for investors to consider buying Bharti's shares.<div type="image" title="Bharti Airtel" msid="102104466" hostid="261" sizebytes="22694"></div>

Will the newly launched JioBharat feature phone impact Airtel? Jefferies believes so

<ul class="summary-list"><li><keyword id="12061432" type="UNKNOWN" weightage="60" keywordseo="private-equity" source="Orion">Private equity</keyword> firm Pamplona is looking to cut ties with Russian oligarch backers, per Bloomberg.</li><li>Pamplona wants to replace its biggest backer; an <keyword id="6355120" type="UNKNOWN" weightage="60" keywordseo="investment" source="Orion">investment</keyword> firm that froze out two Russian cofounders.</li></ul>Private equity firm Pamplona is turning to US investment companies to help cut ties with Russian oligarch backers, <a href="https://www.bloomberg.com/news/articles/2022-05-31/pamplona-seeks-help-from-jefferies-apollo-to-cut-oligarch-ties">Bloomberg</a> reported.Pamplona Capital Management has sought help from American financial services and investment firm <keyword id="12243776" type="UNKNOWN" weightage="60" keywordseo="jefferies" source="Orion">Jefferies</keyword> to help distance itself from Russian oligarch connections, people with knowledge of the matter told Bloomberg.In addition, the private equity company has held initial discussions with investment giant <keyword id="11896186" type="UNKNOWN" weightage="60" keywordseo="apollo" source="Orion">Apollo</keyword> Global Management, some of the sources told Bloomberg. The two companies didn't speak about a structure for a deal in the talks, which were deemed provisional, one person familiar with the matter, who requested anonymity, told Bloomberg.Some of the sources told Bloomberg that it's part of Pamplona's effort to replace its largest backer, LetterOne, a London-based $22 billion investment firm.LetterOne <a href="https://www.businessinsider.com/sanctioned-russian-oligarch-petr-aven-investment-firm-scared-meet-up-2022-3">froze out</a> two of its cofounders, Mikhail Fridman and Petr Aven, in early March after they were sanctioned by the UK and EU over their close ties to the Kremlin in the midst of the <keyword id="11985141" type="UNKNOWN" weightage="60" keywordseo="ukraine" source="Orion">Ukraine</keyword> war. Three of the firm's board members also <a href="https://www.businessinsider.com/russian-billionaires-oligarchs-letterone-resign-step-down-board-lock-out-2022-3">stepped down</a>, despite not being sanctioned, LetterOne told Insider at the time.Pamplona oversees nearly $3 billion of LetterOne's money, a LetterOne spokesman previously told <a href="https://www.bloomberg.com/news/articles/2022-05-31/pamplona-seeks-help-from-jefferies-apollo-to-cut-oligarch-ties">Bloomberg</a>.Pamplona, Jefferies, Apollo, and LetterOne didn't immediately respond to Insider's request for comment made outside of normal working hours.Hundreds of companies all over the world, including financial firms and banks, <a href="https://www.businessinsider.com/list-all-the-companies-pulling-out-of-russia-ukraine-war-2022-3">have cut ties with Russia,</a> following its invasion of Ukraine in late February. Many private equity firms have since steered clear from deals that involve Russian firms and individuals because of the war, Bloomberg reported.

A private equity company wants to cut ties with Russian oligarch backers, with help from US investment firms Apollo and Jefferies, a report says

Online food delivery platform <keyword id="6358977" type="General" weightage="100" keywordseo="swiggy" source="Orion">Swiggy</keyword>'s losses doubled to ₹3,629 crore in FY22 compared to ₹1,617 crore in the last fiscal year. Total expenses went up 131% to ₹9,574.5 crore in FY22. According to its annual financial statement with the Registrar of Companies (RoC), during the last quarter of FY22, Swiggy turned "decacorn" (with a valuation of $10 billion and above) after raising a $700 million round led by Invesco. Meanwhile, Swiggy's revenue grew 2.2 times to ₹5,705 crore during FY22 as opposed to ₹2,547 crore in FY21. According to Entrackr, outsourcing support costs accounted for 24.5% of the total expenses of the company. This particular cost increased 2.3 times to ₹2,350 crore in FY22 from ₹1,031 crore in FY21. Its advertising and promotional expenses surged 4 times to reach ₹1,848.7 crore during FY22, according to the report. Reports surfaced last month that Swiggy may lay off more than 250 employees or up to 5% of its workforce starting January. "There have been no layoffs at Swiggy. We concluded our performance cycle in October and have announced ratings and promotions at all levels. As with every cycle, we expect exits based on performance," a Swiggy spokesperson had said in a statement. The upcoming layoffs are likely to impact Swiggy's quick commerce delivery service <keyword id="9728281" type="General" weightage="50" keywordseo="instamart" source="Orion">Instamart</keyword> to reduce cash burn. In November, global brokerage firm <keyword id="151304" type="General" weightage="50" keywordseo="jefferies" source="Orion">Jefferies</keyword> said that Swiggy was fast losing market share to its rival <keyword id="11830133" type="DOMAIN" weightage="20" keywordseo="zomato" botkeyword="" source="ET" sourcekeytype="COMPANY" meta.keywordsubtype="EQ" meta.aliasname="zomato" meta.entityname="Zomato Ltd." meta.entityid="57948" meta.seoname="zomato-ltd">Zomato</keyword> despite offering heavy discounts. Citing Swiggy investor Prosus' financial report, Jefferies said that the gross value of Swiggy's food delivery business was $1.3 billion in the January-June period this year. Zomato in the same period logged a gross order volume of $1.6 billion. In May last year, Swiggy acquired Dineout, a dining-out and restaurant tech platform, for an undisclosed sum. According to sources, the acquisition size was around $200 million. Earlier this year, the food delivery platform raised $700 million led by Invesco at a $10.7 billion valuation. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/auto/news/tvs-motor-sales-slip-3-58-to-242012-units-in-dec/articleshow/96681654.cms">TVS Motor sales slip 3.58% to 2,42,012 units in Dec</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/indias-manufacturing-pmi-hits-13-month-high-in-dec-on-rise-in-new-orders-strong-demand/articleshow/96678340.cms">India's manufacturing PMI hits 13-month high in Dec on rise in new orders, strong demand</a>

You Searched For "Jefferies report" and got 11 results

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Will the newly launched JioBharat feature phone impact Airtel? Jefferies believes so

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A private equity company wants to cut ties with Russian oligarch backers, with help from US investment firms Apollo and Jefferies, a report says

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Swiggy's losses jump 2X to ₹3,629 crore in FY22, layoffs coming

IANS

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