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Foreign Institutional Investors (FIIs) have been rapidly exiting Indian markets, and this high-speed exodus does not look like it will stop anytime soon. In October 2024, FIIs withdrew Rs 1,14,445.89 crores from Indian markets. Yesterday, FIIs withdrew $770.67 million from the markets, with equity outflows of $440.86 million and debt outflows standing at $327.44 million across various categories. Per NSDL data, hybrid outflows amounted to $2.31 million. While this may sound dissuading at first, a recent SBI report underlined that FIIs still hold a massive $ 18.241 billion in Indian markets. So far, FY25 has seen FII inflows worth $ 8.924 billion. However, the situation may quickly turn alarming as well, given that FII holdings in Indian equities have already come down to a 12-year low. Says Anirudh Garg, Partner and Fund Manager at Invasset PMS, "The current valuation of Indian stocks, trading at around 24 times expected earnings, appears high compared to Chinese stocks, which are at approximately 10 times. Economic concerns, including weak corporate earnings and declining consumer demand, further exacerbate this situation. Additionally, renewed fears of inflation and potential monetary tightening by central banks have led FIIs to withdraw from the Indian market." In the meantime, DIIs (domestic institutional investors) are stepping in big time. During October 2024, DIIs infused Rs 1,07,254.68 crore in Indian markets. In November so far, DIIs have been keeping the fund momentum going, infusing Rs 12,265.74 crore in India, while FIIs have offloaded Rs 16,445.49 crore this month. But despite this strong uptick, SBI's recent report suggests that consumer confidence in India remains below 100, signaling muted positivity and optimism in the economy. While household consumption is gradually recovering, it grew at 4% last year, much below the 7% levels recorded pre-pandemic. <h2>FII share in <keyword id="20868945" type="General" weightage="20" keywordseo="NSE-listed-companies" source="keywords">NSE-listed companies</keyword> takes a dip, DII stake rise </h2>FIIs share in NSE-listed companies stood at 15.98% in October, with assets under their custody in the equity segment coming to Rs 71.08 lakh crore last month. In September, this stood at Rs 77.96 crore. Experts suggest that this is likely to continue for some time to come. Mutual funds, on the other hand, saw their share in NSE-listed companies hit a record high of 9.58%, as opposed to their 9.32% stake in September 2024. FIIs turned net sellers in the debt segment as well in October, dumping $771 million in Indian markets. This comes after 2 consecutive months of healthy inflows in this segment in August and September 2024, where the figures stood at $2,806 million and $2,295 million, respectively.

FII stake in Indian equities dips to a 12-year low

The ongoing issue involving Supreme Infrastructure India Limited (<keyword id="23294280" type="General" weightage="20" keywordseo="SIIL" source="keywords">SIIL</keyword>) and the State Bank of India (<keyword id="19898108" type="General" weightage="100" keywordseo="SBI" source="keywords">SBI</keyword>) has become a focal point in India’s financial and political landscape. It concerns SIIL’s default on significant loans and SBI’s decision to convert this debt into equity, raising concerns about the precedent it may set for future debt resolutions in India. <h2>SIIL's financial troubles</h2>SIIL, a construction and infrastructure company, was once engaged in large-scale projects such as roads and bridges across India. Over the years, however, the company faced severe financial troubles due to project delays and insufficient revenues. As SIIL’s cash flow problems worsened, it struggled to repay its loans, leading to the company’s default. The State Bank of India (SBI), being SIIL’s largest lender, found itself at the centre of this financial turmoil, as SIIL declared bankruptcy. In response, SBI decided to take an unusual step to recover its dues. <h2>SBI's debt-to-equity conversion decision</h2>In a surprising move, SBI converted its outstanding debt into equity in SIIL. This means that instead of pursuing traditional recovery methods or selling off assets, SBI has now become an equity stakeholder in SIIL, shifting from being its primary lender to part-owner. The controversial decision also involved other lenders who agreed to take a 93.45% “haircut” on the debt, which indicates that they are recovering only a fraction of the original loans extended to SIIL. <h2>Criticism and concerns</h2>The decision has drawn sharp criticism, particularly from political circles. <keyword id="19895371" type="General" weightage="20" keywordseo="Congress" source="keywords" meta.keywordsubtype="org" meta.entityname="Congress" meta.hostid="261" meta.entityid="Congress">Congress</keyword> leader Jairam Ramesh, through a post on the social media platform X (formerly Twitter), criticised SBI’s approach and raised several concerns. He highlighted that SBI’s decision to become an equity stakeholder in a company that declared bankruptcy could set a "dangerous precedent in India’s <keyword id="20575563" type="General" weightage="20" keywordseo="corporate-debt" source="keywords">corporate debt</keyword> landscape". "This arrangement creates a dangerous precedent in India's corporate debt landscape — it encourages other defaulting companies to seek similar deals, where they can retain control and value even after significant defaults," Ramesh noted. <div type="Article" hostid="261" msid="112987756" title="Congress alleges SEBI Chairperson Madhabi Puri Buch of office for profit" mstype="2" mssubtype="0"></div>His concerns extend to how this move might affect the <keyword id="20158086" type="General" weightage="20" keywordseo="Insolvency-and-Bankruptcy-Code" source="keywords">Insolvency and Bankruptcy Code</keyword> (IBC) and India’s overall framework for handling distressed companies. By converting <keyword id="22921090" type="General" weightage="20" keywordseo="debt-to-equity" source="keywords">debt to equity</keyword>, SBI could be seen as aligning itself with the interests of the defaulting borrower (SIIL) rather than prioritising the recovery of public funds, which are at stake in cases involving <keyword id="19959986" type="General" weightage="20" keywordseo="public-sector-banks" source="keywords">public sector banks</keyword> like SBI. “The SBI appears to be aligning itself with the interests of the defaulting borrower (SIIL) rather than prioritising the recovery of public funds,” Ramesh further argued. "The Reserve Bank of India (RBI) needs to step in and examine SBI's decision-making process in this matter." Given the unusual nature of this debt restructuring and the potential risks it introduces, Congress is urging the Reserve Bank of India (RBI) to step in and examine SBI’s decision-making process. Ramesh emphasised the need for regulatory scrutiny to ensure that public sector banks maintain discipline in their approach to resolving bad loans. Congress' position is that SBI’s move could create a moral hazard within India’s <keyword id="19964544" type="General" weightage="20" keywordseo="banking-sector" source="keywords">banking sector</keyword>, encouraging more companies to default on their loans with the hope of retaining control through similar debt-to-equity swaps. Ramesh pointed out that the entire situation raises questions about how distressed assets should be managed by public sector banks, and whether SBI’s actions are truly in the best interests of the public. <div type="Article" hostid="261" msid="113620397" title="SEBI report reveals the ugly truth of F&amp;amp;O trading in India – 93% of retail traders incurred losses" mstype="2" mssubtype="0"></div>"There is a pressing need to ensure that public sector banks maintain strict discipline in their approach to debt resolution and avoid creating moral hazards in the financial system." <h2>Broader implications</h2>This situation shines a light on broader challenges in India’s banking and insolvency frameworks. When public sector banks like SBI take significant financial losses (haircuts) and switch from creditors to shareholders, it risks undermining confidence in the banking sector’s ability to handle bad loans effectively. Moreover, it raises questions about the long-term sustainability of the Insolvency and Bankruptcy Code (IBC) if companies that default can avoid paying back substantial portions of their debt and still retain operational control. (With inputs from PTI)

Congress criticises SBI's decision to convert SIIL debt into equity, urges RBI intervention

In recent years, <keyword id="19902194" type="General" weightage="20" keywordseo="Anil-Ambani" source="keywords">Anil Ambani</keyword>'s <keyword id="20479923" type="General" weightage="100" keywordseo="Reliance-Group" source="keywords" meta.keywordsubtype="org" meta.entityname="Reliance Group" meta.hostid="153" meta.entityid="Reliance Group">Reliance Group</keyword> has seen marquee firms being auctioned in insolvency proceedings and piling debt-fold businesses. But the group has, in the week gone by, made announcements that investors believe may mark its transformation. In three days -- from September 18 to September 20 -- the group announced it has turned into nearly zero debt and is implementing long-term fundraising plans that are said to solidify its financial position. <keyword id="20144587" type="General" weightage="20" keywordseo="Reliance-Infrastructure" source="keywords" meta.keywordsubtype="org" meta.entityname="Reliance Infrastructure" meta.hostid="153" meta.entityid="Reliance Infrastructure">Reliance Infrastructure</keyword>'s board approved <keyword id="20431799" type="General" weightage="20" keywordseo="fund-raising" source="keywords">fund raising</keyword> of up to Rs 6,000 crore via preferential issue and QIP, while <keyword id="20024191" type="General" weightage="20" keywordseo="Reliance-Power" source="keywords" meta.keywordsubtype="org" meta.entityname="Reliance Power" meta.hostid="153" meta.entityid="Reliance Power">Reliance Power</keyword> board is meeting on September 23 to consider and approve the fundraise via multiple routes. The speed at which Anil Ambani moved to clear the debt of his companies, and simultaneously announce and execute the fund raising plans for future expansion of his companies, has surprised the investors. Shares of both firms surged on stock markets. The announcement to invest Rs 1,100 crore by the promoters group in Anil Ambani's flagship company, Reliance Infrastructure, has further boosted the confidence of investors in the group's revival plans and its long-term growth story, investors said. Anil Ambani's twin strategy of <keyword id="21440133" type="General" weightage="20" keywordseo="debt-reduction" source="keywords">debt reduction</keyword>, coupled with fresh capital raising, has set the stage for a long-term transformation of the Reliance Group, they feel. Reliance Infrastructure's <keyword id="20000950" type="General" weightage="20" keywordseo="market-capitalisation" source="keywords">market capitalisation</keyword> by the end of this week surged nearly 50%, rising from Rs 8,500 crore to Rs 12,500 crore. Similarly, Reliance Power's market capitalisation increased over 25%, moving from Rs 11,500 crore to Rs 14,600 crore. Reliance Infra announced a significant reduction in standalone external debt, lowering it from Rs 3,831 crore to just Rs 475 crore. This was achieved by clearing outstanding dues to prominent lenders such as Life Insurance Corporation of India (LIC), Edelweiss ARC, ICICI Bank, and Union Bank, according to company filings. The move signals a robust financial recovery and enhances Reliance Infra's financial flexibility. Also, Reliance Infra board approved a preferential issue to raise Rs 3,014 crore, increasing the stake of Risee Infinity Pvt Ltd, a promoter group entity, along with other investors such as Florintree Innovation LLP and Fortune Financial &amp; Equities Services Pvt Ltd. The board also approved seeking shareholder authorization to raise an additional Rs 3,000 crore via a qualified institutional placement. This will provide further capital to strengthen the balance sheet and invest in new growth opportunities. With these fund infusions, Reliance Infra's net worth is set to rise from over Rs 9,000 crore to more than Rs 12,000 crore, according to the filings. The company is now well-positioned to invest in high-growth sectors, investors said.

Anil Ambani's Reliance Group starts transformation journey, achieves near zero-debt

New Delhi [India], July 12 (ANI): <keyword id="20043730" type="General" weightage="20" keywordseo="Jio-Financial-Services" source="keywords" meta.keywordsubtype="org" meta.entityname="Jio Financial Services" meta.hostid="261" meta.entityid="Jio Financial Services">Jio Financial Services</keyword> has received the nod from the <keyword id="19899810" type="General" weightage="20" keywordseo="Reserve-Bank-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Reserve Bank of India" meta.hostid="261" meta.entityid="Reserve Bank of India">Reserve Bank of India</keyword> (<keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords">RBI</keyword>) to convert into a <keyword id="20871282" type="General" weightage="20" keywordseo="Core-Investment-Company" source="keywords">Core Investment Company</keyword> (CIC) from a Non-Banking Financial Company (<keyword id="19938496" type="General" weightage="20" keywordseo="NBFC" source="keywords">NBFC</keyword>). The company in an official statement on Thursday stated that "Further to the disclosure dated November 21, 2023, the Company has today received from the Reserve Bank of India approval for conversion of the Company from Non-Banking Financial Company to Core <keyword id="19895437" type="General" weightage="20" keywordseo="investment" source="keywords">Investment</keyword> Company." According to the Reserve Bank of India, a CIC is a specialised NBFC with an minimum asset size of Rs 100 crore. The RBI's circular dated December 20, 2016 stated that, a CIC's main business is the acquisition of shares and securities with certain conditions. One of the conditions stipulated by the central bank is that the CIC holds not less than 90 percent of its net assets in the form of investment in equity shares, preference shares, bonds, debentures, debt or loans in group companies. The transition from an NBFC to a CIC involves several key changes in the company's operational framework. As a Core Investment Company, <keyword id="2003276" type="General" weightage="20" keywordseo="Jio" source="Orion">Jio</keyword> Financial Services will primarily focus on investments in and the management of its subsidiaries companies. The transformation to a CIC structure would enable Jio Financial Services to delineate the financials and operations of each subsidiary, to provide better value discovery for investors. Unlike typical NBFCs, CICs are non-deposit taking financial companies that have their assets predominantly invested in the equity shares, preference shares, or debt instruments of their group companies. As a CIC, the company gains greater operational flexibility. It can now focus on core investment activities without engaging in other financial services. The CICs can explore different sectors and diversify their investment portfolio. This flexibility allows them to adapt to changing market conditions. The shares of the company also surged more than 1.5 per cent during the opening session on Friday, and stands at Rs 353.25 at the time of filing this report. (ANI)

Jio Financials gets RBI nod to become Core Investment Company

Economists at the country's largest lender, SBI, today said they see India's Q2 real GDP growth slowing down further to 6.5% in the September quarter of this fiscal year. Amid concerns over the country's economic growth rate and whether it is slowing down, the analysts said they expect FY25 growth to come "closer to" 7%. SBI analysts join a long line of agencies like Fitch, ADB, IMF, Moody, World Bank, S&amp;P, and even RBI in forecasting India's GDP growth for FY25 in the range of 6.8% to 7.2% for FY25, driven by robust consumption and investment. SIP inflows have been at an all-time high, and so has QIP (qualified institutional placement) fundraising. As many as 71 companies raised Rs 88,678 crore this year through QIPs. Activity in Indian primary markets also remained robust, with 78 mainboard IPOs in 2024; this is a 111% rise from just 38 listings in FY23. Between April and June 2024, India's real GDP grew by 6.7%, the lowest growth seen in 15 quarters, pushing experts to believe that India is caught in a cycle of slowdown. "There is some incipient pressure evident on the domestic economy. Based on our analysis of 50 meaningful leading indicators (both consumption and demand-centric), a dip looks plausible across select cohorts of agriculture, industry, and services in Q2," the <keyword id="22337294" type="General" weightage="20" keywordseo="SBI-economists" source="keywords">SBI economists</keyword> added. Stating that they track 50 indicators to gauge economic activity, SBIs note said the proportion of indicators showing acceleration declined to 69% in Q2 FY25, as against 80% in Q2 FY24 and 78% in Q1 FY25. However, things might be changing now, given that rural demand has started looking up amidst muted urban demand. SBI also explained that the ongoing regulatory tightening on unsecured lending and roadblocks that are hindering rollover/refinancing of debt through unsecured credit are dismantling the unwarranted exuberance that had built up post-pandemic, especially in the urban areas. Madhu Lunawat, CIO &amp; Fund Manager, Bharat Value Fund states that the overall investment environment remains strong due to favorable economic conditions supporting government policies &amp; reforms. "The sustainable inflow from domestic investors is going to support the Indian equity market in any kind of correction. The long-term bullish structure of Indian economy will continue to attract new domestic &amp; global investors to participate in India’s growth story through various Investment avenues.” <h2>Rate cuts not on cards</h2>RBI Governor Shaktikanta Das clarified today that changing the monetary policy stance to 'neutral' does not mean a rate cut is imminent in the central bank's next policy announcement. Notably, RBI MPC is set to meet between December 4 and 6, 2024, to decide if the prevailing repo rate of 6.5%, which has stayed unchanged for the last 2 years, should be brought down or not. In its last meeting, The <keyword id="20501100" type="General" weightage="20" keywordseo="RBI-monetary-policy" source="keywords">RBI monetary policy</keyword> committee had shifted its stance to 'neutral' indicating that it is open to adjusting interest rates based on economic conditions. "It should not be assumed that we have done this, so therefore the next step is a rate cut. A change in stance doesn't mean that the next step is a rate cut in the very next meeting. It's not so," Das said. Das also cautioned that inflation remains a key factor, and inflation and CPI prints for October are expected to stay high.

SBI economists see Q2 GDP growth slowing down to 6.5%; FY25 growth to be closer to 7%

Byju's Founder <keyword id="1702989" type="General" weightage="100" keywordseo="Byju-Raveendran" source="Orion">Byju Raveendran</keyword>'s plea against the insolvency of <keyword id="19901241" type="General" weightage="20" keywordseo="Think-Learn" source="keywords">Think &amp; Learn</keyword> before the NCLAT was adjourned on Monday, as one of the members of the bench recused from the hearing. The matter will be placed before a bench headed by <keyword id="19916403" type="General" weightage="20" keywordseo="National-Company-Law-Appellate-Tribunal" source="keywords" meta.keywordsubtype="org" meta.entityname="National Company Law Appellate Tribunal" meta.hostid="345" meta.entityid="National Company Law Appellate Tribunal">National Company Law Appellate Tribunal</keyword> (NCLAT) Chairman Justice Ashok Bhushan, who will assign a different bench to hear the matter. Raveendran had filed a petition challenging the initiation of <keyword id="19965539" type="General" weightage="20" keywordseo="insolvency-proceedings" source="keywords">insolvency proceedings</keyword> against Think &amp; Learn, which runs edtech company Byju's. The matter was listed on Monday before a two-member Chennai-based bench of the NCLAT comprising Justice Sharad Kumar Sharma, Member (Judicial), and Jatindranath Swain, Member (Technical). However, Justice Sharma recused himself from the hearing, saying he had appeared as the counsel for the Board of Control for Cricket in India (<keyword id="19901245" type="General" weightage="20" keywordseo="BCCI" source="keywords" meta.keywordsubtype="org" meta.entityname="BCCI" meta.hostid="345" meta.entityid="BCCI">BCCI</keyword>) before his elevation. "I have appeared as a senior counsel for (the) BCCI. Since they are the main beneficiaries of this order, I cannot take this up," said Sharma. The Bengaluru bench of the National Company Law Tribunal (<keyword id="19901085" type="General" weightage="20" keywordseo="NCLT" source="keywords">NCLT</keyword>) on July 16 directed Corporate Insolvency Resolution Proceedings (CIRP), admitting the plea filed by the BCCI. The BCCI had approached the NCLT under the Insolvency and Bankruptcy Code (IBC) over a default of Rs 158.9 crore by Think &amp; Learn -- once India's most valuable startup worth an estimated $22 billion. NCLT has suspended the board of Think &amp; Learn Pvt Ltd as per the provisions of the IBC and had appointed an interim resolution professional (IRP) to take care of the debt-ridden firm. Raveendran challenged the NCLT order before the appellate tribunal NCLAT. He has also approached the Karnataka High Court. The high court had, on July 26 deferred Raveendran's plea to July 30. At the high court, Raveendran challenged the validity of the order and suspension of the NCLT order till the NCLAT hears the appeal.

NCLAT judge recuses from hearing Raveendran's plea against insolvency proceedings of Byju

<ul><li>A <keyword id="17512600" type="General" weightage="20" keywordseo="debt-resolution-company" source="Orion">debt resolution company</keyword> offers comprehensive solutions to help individuals overcome their debt burdens. </li><li>The primary goal of a <keyword id="977398" type="General" weightage="20" keywordseo="debt-counsellor" source="Orion">debt counsellor</keyword> is to equip individuals with the knowledge, tools and support necessary to navigate the challenges of debt resolution. </li><li>It is essential to conduct thorough research and compare the fees of different debt resolution companies before making a decision.</li></ul>Dharshan Kumar S, a 30-year old banker, had a <keyword id="180660" type="General" weightage="20" keywordseo="personal-loan" source="Orion">personal loan</keyword> on his <keyword id="6368202" type="General" weightage="20" keywordseo="credit-card" source="Orion">credit card</keyword> and was paying his EMIs on time. But during the lockdown, the family income went down and he could not pay the EMIs, or equated monthly instalments. With his <keyword id="6360217" type="General" weightage="20" keywordseo="loan" source="Orion">loan</keyword> and credit card debt, his outstanding dues rode up to ₹4 lakh and he was struggling to repay. There were creditors coming home and harassing him. That’s when he came across the contact of a debt resolution company on Facebook and approached them for help. <cmsannotation type="cmsannotation" annotationid="Options to deal with outstanding debt" comment="subhead" text="Options to deal with outstanding debt">Options to deal with outstanding debt</cmsannotation> In today's world, loans have become an essential part of our lives, and many individuals find themselves managing multiple debts simultaneously. If you are facing difficulties due to excessive debt, the initial crucial step is to assess and understand the nature of your debts. “It is crucial to identify high-cost debts such as credit cards, and app loans with interest rates as high as 40-48%, personal loans, and accordingly decide where to concentrate your repayment efforts first. The longer one keeps loans open, the more interest one has to pay overtime, and it can eventually spiral into a toxic trap that will lead to delinquency if not repaid on time,” says Ritesh Srivastava, founder and chief executive officer, FREED, a debt relief platform. “There are several options available for individuals who are struggling with outstanding debt,” says Manavjeet Singh, managing director &amp; CEO, CLXNS, a debt collection platform for banks. Debt consolidation, debt counselling, and debt resolution are some of the options. <cmsannotation type="cmsannotation" annotationid="Should you approach a debt resolution platform?" comment="subhead" text="Should you approach a debt resolution platform?">Should you approach a debt resolution platform?</cmsannotation> “When debt has gone out of hand, one should take help from professionals for debt management. While debt restructuring and subsequent resolution will need traditional finance experts, a money coach would be great to help you with behavioural changes,” says Renu Maheswari, co-founder and principal advisor, Finscholarz Wealth Managers. “Nothing comes for free, so weigh the pros and cons and use debt resolution as the last resort,” she adds. <cmsannotation type="cmsannotation" annotationid="How does debt resolution work?" comment="subhead" text="How does debt resolution work?">How does debt resolution work?</cmsannotation> “A debt resolution company offers comprehensive solutions to help individuals overcome their debt burdens. These companies provide services such as debt settlement, consolidation, and elimination. Debt settlement involves implementing financial discipline by setting aside funds for loan repayment in a trust account and thereafter negotiating with the creditors,” says Srivastava. On the other hand, debt consolidation focuses on combining multiple high-cost loans into a single loan. By doing so, individuals can benefit from a reduced interest rate and an extended repayment period. It is helpful for borrowers who are currently repaying their debt but are over-leveraged. <cmsannotation type="cmsannotation" annotationid="The importance of debt counselling" comment="subhead" text="The importance of debt counselling">The importance of debt counselling</cmsannotation> Debt counselling services employ a systematic approach to help individuals burdened by debt achieve a debt-free life. These services involve offering educational resources, guidance on budgeting, and utilising tools and strategies to reduce and eliminate debt. The main objective is to foster financial discipline in borrowers and provide ongoing support throughout the debt relief process, all while avoiding excessive upfront costs. “The primary goal of a debt counsellor is to equip individuals with the knowledge, tools and support necessary to navigate the challenges of debt resolution. By providing financial education, budgeting assistance, and advocating for their clients' interests, these services empower individuals to take control of their financial situation and work towards achieving freedom from debt,” says Srivastava. The fees associated with debt counselling resolution services in India can vary based on the specific services offered and the debt resolution company selected. Many companies offer a free initial consultation, after which fees may be charged for ongoing services. This can be a percentage of the total debt, in case the debt issue is resolved, or subscription fees for other services such as counselling, support for creditor harassment, budgeting. “It is important to carefully research and compare the fees of different debt resolution companies before choosing one,” says Singh. Kumar was counselled on his debt and how he could handle his creditors. Now he has to pay a consolidated amount every month to his debtors and is looking to be debt free soon.

Neck deep in debt? Here’s how some companies are helping habitual borrowers consolidate their loans

<ul><li>The pain in the mutual fund companies’ finances is reflected in the latest corporate earnings of some mutual fund companies.</li><li>Among the top mutual fund companies Aditya Birla Sun Life AMC reported a 13% on- year decline in net profit to ₹136 crore from ₹156 crore last year.</li><li>For <keyword id="174045" type="General" weightage="20" keywordseo="HDFC-AMC" source="Orion">HDFC AMC</keyword>, on a sequential basis, its profit rose by a marginal 2% to ₹376 crore in March quarter from ₹369 crore in the previous quarter.</li><li>Government’s changes in <a href="https://www.businessinsider.in/business/news/debt-schemes-of-mfs-lose-edge-over-bank-deposits-as-budget-proposes-to-scrap-ltcg-indexation-benefits/articleshow/98965932.cms">debt funds tax structure</a>, rising competition and stricter norms on tax expense ratios (TER) are some triggers that have impacted the mutual fund companies.</li><li>As a result, shares of all the listed asset management companies have been in the red so far in 2023 underperforming the broader market.</li></ul>The year 2023 has not been kind to asset management companies listed on Indian stock exchanges. They have been battered 20-32% so far this year as several stricter regulatory norms hit their profit avenues. Government’s changes in <a href="https://www.businessinsider.in/business/news/debt-schemes-of-mfs-lose-edge-over-bank-deposits-as-budget-proposes-to-scrap-ltcg-indexation-benefits/articleshow/98965932.cms">debt funds tax structure</a>, rising competition and stricter norms on tax expense ratios (TER) are some triggers that have impacted the mutual fund companies. The pain is visible in the latest corporate earnings of some mutual fund companies. Among the top mutual fund companies Aditya Birla Sun Life AMC reported a 13% on-year decline in net profit to ₹136 crore from ₹156 crore last year. “While we are constructive on Aditya Birla Sun Life AMC’s strong and diversified distribution network, given rising competitive intensity, we believe yields will plummet faster than assets under management (AUM) growth, posing a high risk to earnings from negative operating leverage,” said analysts at HDFC Securities. The brokerage house downgraded the rating on the company’s stock to ‘Add’ from ‘Buy’. As a result, shares of Aditya Birla Sun Life AMC have been the top loser among its peers, slipping 21% in 2023 so far. Rival HDFC Asset Management Company posted a sequential 2% rise in profit to ₹376 crore in the March quarter while its revenue fell 3% to ₹541 crore. However, in the case of HDFC AMC, analysts feel that the impact of the total expense ratio (TER) changes on the company’s stock may be limited due to strong AUM growth and potential benefits from its HDFC Bank parentage. Housing Development Finance Corporation (HDFC) is the parent company of HDFC AMC that is expected to complete its merger with HDFC Bank by <a href="https://economictimes.indiatimes.com/wealth/borrow/hdfc-hdfc-bank-merger-how-will-it-impact-hdfc-home-loan-borrowers-will-home-loan-interest-rates-go-down/articleshow/99978517.cms">July this year as per reports. </a> “While we remain watchful of the proposed changes in the TER structure and HDFC AMC’s stock has corrected by c.9% over the last 3 months on fears regarding the changes, we expect the impact to be limited and current valuations (20x FY25 EPS) adequately factor in the expected cut in earnings. HDFC AMC is our top pick in the space and the stock can see a meaningful rerating in the near to medium term driven by robust AUM growth and potential benefits from HDFC Bank parentage,” said analysts at JM Financial. On the other hand, <keyword id="193636" type="General" weightage="20" keywordseo="uti-amc" source="Orion">UTI AMC</keyword>’s profit grew strongly to ₹86 crore in March quarter from ₹60 crore in the previous quarter and ₹54 crore during the same period last year. However, Nippon Life Asset Management’s profits were flat sequentially at ₹198.96 crore while revenue from operations fell nearly 2% at ₹325 crore. As a result, shares of all the listed asset management companies have been in the red so far in 2023 underperforming the market. The benchmark Sensex is up almost 1% so far this year. <table style="border-width: initial; border-style: none;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Asset management companies </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Share price gains/losses in last 5 days </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Share price gains/losses YTD </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Aditya Birla Sun Life AMC </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">5% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-21% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">UTI AMC </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.34% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-23% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Nippon Life India AMC </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.02% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-5% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HDFC AMC </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.50% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-17% </td></tr></tbody><tbody></tbody></table>Source: NSE Fall in average ticket size of retail investors show signs of weakness While mutual funds are popular among investors, the average ticket size of retail investors has dropped nearly 3% to ₹68,321 in March 2023 from ₹70,199 last year, according to data from the Association of Mutual Funds in India (AMFI). The amendment in the Finance Bill that proposed to do away with <a href="https://www.businessinsider.in/business/news/debt-schemes-of-mfs-lose-edge-over-bank-deposits-as-budget-proposes-to-scrap-ltcg-indexation-benefits/articleshow/98965932.cms">long-term capital gains tax benefits on debt investments</a> was the latest trigger that impacted the mutual fund companies. As per the proposed changes in the Finance Bill, investors in debt funds will have to pay tax according to their income slabs. Investors had so far benefited from indexation while calculating long-term capital gains from debt funds but this will now longer be available effective 1 April. Adding to it, as per reports, the Securities and Exchange Board of India (SEBI) is considering taking action against big fund houses that charge very high expense ratios from their customers. Currently as per SEBI’s rules, mutual funds can charge a total expense ratio (TER) of up to 2.25%, if the AUM reaches ₹500 crore. However, the regulator might now reduce this expense amount to benefit investors. Also, since distributors earn more commission by selling new funds, there are cases of mis-selling. Hence to protect investor interest, the regulator is looking to <a href="https://economictimes.indiatimes.com/opinion/et-editorial/make-mf-schemes-more-affordable/articleshow/98485116.cms?from=mdr">bring a uniform expense ratio </a>for mutual fund schemes. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/fpis-pump-9677-crore-into-financial-services-and-auto-stocks-in-april/articleshow/100100496.cms">FPIs pump ₹9,677 crore into financial services and auto stocks in April</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/auto/news/fy23-scorecard-tvs-motor-fares-better-than-bajaj-auto-hero-motocorp-on-profits-and-margins/articleshow/100082560.cms">FY23 Scorecard: TVS Motor fares better than Bajaj Auto, Hero MotoCorp on profits and margins</a>

Mutual fund company stocks bleed this year, thanks to tax hit on debt funds and strict expense ratio norms

<keyword id="16492024" type="General" weightage="100" keywordseo="Homegrown-EV-charging" source="Orion">Homegrown EV charging</keyword> and <keyword id="16492025" type="General" weightage="20" keywordseo="mobility-solutions-company" source="Orion">mobility solutions company</keyword> <keyword id="14455900" type="General" weightage="20" keywordseo="Magenta-Mobility" source="Orion">Magenta Mobility</keyword> has raised $40 million in its Series B <keyword id="12999336" type="General" weightage="40" keywordseo="funding" source="ETB2B" meta.aliasname="funding" meta.entityname="funding" meta.entityid="7040">funding</keyword> in a mix of equity and debt, the media reported. Backed by <keyword id="16492026" type="General" weightage="20" keywordseo="Microsofts-global-startup" source="Orion">Microsoft's global startup</keyword> programme, the company closed $20 million in equity funding led by two global marquee investors, reports DealStreetAsia. The company raised $20 million in debt in the same round. Magenta is aiming to expand its geographical presence in cities including Hyderabad, Chennai, Delhi and Chandigarh. The company has a fleet of 600 3-wheelers and 4-wheelers across the country and expects to have over 4,000 in fiscal 2023-24, the report said. Last year, the Mumbai-based charging solutions provider announced its collaboration with Amazon <keyword id="13362851" type="General" weightage="40" keywordseo="india" source="ETB2B" meta.aliasname="india" meta.entityname="india" meta.entityid="7017">India</keyword>. Through this partnership, Magenta Mobility works with Amazon India to induct a fleet of <keyword id="12991107" type="General" weightage="40" keywordseo="electric-vehicles" source="ETB2B" meta.aliasname="electric vehicles" meta.entityname="electric vehicles" meta.entityid="7048">electric vehicles</keyword> including two and four-wheeler electric vehicles for its delivery partners in Hyderabad. Magenta Mobility's current list of customers includes all the major e-commerce businesses such as Amazon, Flipkart, Bigbasket, Porter and Udaan. It has a relationship with the electric-vehicle manufacturers such as Tata Motors, Mahindra Electric, Omega Seiki and Euler Motors. Magenta is a Series A funded company backed by HPCL and investors such as JITO Angel Network, LetsVenture, and Indian-American philanthropist, Dr Kiran Patel. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/auto/news/renault-nissan-commits-5300-cr-to-tn-to-introduce-6-new-models-including-evs/articleshow/97867394.cms">Renault-Nissan commits ₹5,300 cr to TN; to introduce 6 new models including EVs</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/reliance-seeks-12-75-for-cbm-gas-ongc-wants-9-35/articleshow/97867864.cms">Reliance seeks $12.75 for CBM gas, ONGC wants $9.35</a>

EV startup Magenta Mobility raises $40 million in equity and debt

The one-hour <keyword id="23618998" type="General" weightage="100" keywordseo="Muhurat-trading" source="keywords">muhurat trading</keyword> session, which marks <keyword id="20963892" type="General" weightage="20" keywordseo="Diwali-2024" source="keywords">Diwali 2024</keyword> and the onset of Hindu Samvat 2081 on both NSE and BSE, is set to commence at 6 pm today and will conclude at 7 pm. Generally, investors and traders make symbolic stock buys during this hour-long session, since it is believed that purchases made during this time herald wealth and prosperity for one’s investments for the year to come. If you are looking for <keyword id="19910146" type="General" weightage="20" keywordseo="stock-recommendations" source="keywords">stock recommendations</keyword> to add to your portfolio, here are a few value picks by SAMCO and Kotak Securities you can consider: <keyword id="19895995" type="General" weightage="20" keywordseo="HDFC-Bank" source="keywords" meta.keywordsubtype="org" meta.entityname="HDFC Bank" meta.hostid="261" meta.entityid="HDFC Bank">HDFC Bank</keyword> Ltd Holding period: 1 year Last Traded Price: Rs 1,734.30 Per the firm, “The bank has maintained a robust 10-year profit CAGR of 21.74%, operating with a NIM (net interest margin) of 3.5% and a low net NPA (non-performing assets) of 0.3%. Advances and deposits have shown steady growth. Currently, the stock trades below its 10-year average price-to-book value and at a price-to-earnings ratio of 19, offering a favorable risk-reward profile with a substantial downside buffer”. <keyword id="22086440" type="General" weightage="20" keywordseo="Vindhya-Telelinks" source="keywords" meta.keywordsubtype="org" meta.entityname="Vindhya Telelinks" meta.hostid="261" meta.entityid="Vindhya Telelinks">Vindhya Telelinks</keyword> Ltd Holding Period: 1 year Last Traded Price: Rs 1,992.55 SAMCO notes that this key cable manufacturing, which is a joint venture between Universal Cables Limited and Madhya Pradesh State Industrial Development Corporation, has shown robust growth over the last 5 years, nearly doubling revenues with a 14.3% CAGR. The company holds significant investments in Birla Cable Ltd, Birla Corporation Ltd, and Universal Cable Ltd, totaling Rs 3,618 crore—surpassing its market capitalization of Rs 2,545 crore. This solid investment base underscores Vindhya Telelinks’ strong fundamentals and financial potential. <keyword id="23763358" type="General" weightage="20" keywordseo="Ramco-Industries" source="keywords" meta.keywordsubtype="org" meta.entityname="Ramco Industries" meta.hostid="261" meta.entityid="Ramco Industries">Ramco Industries</keyword> Ltd Holding Period: 1 year Last Traded Price: Rs 244.89 SAMCO observes that over the past decade, sales grew at a 7% CAGR, while the share price rose at a 14% CAGR. Known for its financial stability, Ramco Industries boasts a low debt-equity ratio of 0.07 and has consistently paid dividends since FY17, currently yielding 0.31%. The stock’s attractive price-to-book multiple of 0.5 offers a solid margin of safety, highlighting its investment appeal. <keyword id="22786675" type="General" weightage="20" keywordseo="Gravita-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Gravita India" meta.hostid="261" meta.entityid="Gravita India">Gravita India</keyword> Holding Period: 12 months Last Traded Price: Rs 2,119 Kotak explains that Gravita India is the market leader in India’s emerging recycling industry with a focus on lead recycling. Gravita India is increasing its recycling capacity by a massive 72% to 500 ktpa by FY27E. “We expect the company’s earnings per share to grow by 31.8% in FY25E &amp; 31.6% in FY26E. We also expect an upside of 15% or more on this stock over the next 12 months”, adds Kotak’s note. <keyword id="23763359" type="General" weightage="20" keywordseo="S-H-Kelkar" source="keywords" meta.keywordsubtype="org" meta.entityname="S H Kelkar" meta.hostid="261" meta.entityid="S H Kelkar">S H Kelkar</keyword> and Company (SHKL) Holding Period: 12 months Last Traded Price: Rs 289.90 The company is a flavors &amp; fragrances (F&amp;F) supplier and has started to make inroads into the global market. SHK is well-placed to drive double-digit revenue growth. The company is a small but emerging contender in the vast F&amp;F market, with potential for margin expansion—higher-margin geographies &amp; operating leverage—allowing for over 15% return upside in the next 12 months. Kotak Securities further notes that FY25 will likely see more broad-based growth across sectors. However, the OMCs (oil marketing companies) may likely drag down overall profits. Most sectors and stocks are quite overvalued, with the degree of overvaluation ranging from: (1) low for most large-cap consumers, IT services, and pharmaceuticals (2) medium in the investment space (3) high in the case of several low-quality companies. "As the broader market valuations are rich, opportunities arising from market correction can be used to add quality stocks (with attractive valuations) from a long-term investment perspective," explains the research firm's note. SAMCO further advises adding a little glitter to your portfolio using GoldBees and SilverBees ETFs since there are recessionary fears in the US and geopolitical tensions across the world. Even central bankers like RBI have been adding gold to their vaults like never before. At present, markets are looking to secure their return on capital rather than seeking a return on capital. "Thus all of these make a strong case to add gold and silver to the portfolio. They will give stability to your portfolio this Samvat," adds SAMCO's note.

You Searched For "debt companies in india" and got 10 results

FII stake in Indian equities dips to a 12-year low

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Mutual fund company stocks bleed this year, thanks to tax hit on debt funds and strict expense ratio norms

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EV startup Magenta Mobility raises $40 million in equity and debt

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