Divam Sharma of Green Portfolio says this year seems to be a year of consolidation for the sector. The economic slowdown and potential recession in some of the developed nations will impact the sentiments and order flows for the sector.
This seems to be a year of consolidation for the IT sector as the economic slowdown and potential recession in some of the developed nations will impact the sentiments and order flows for the industry, says Divam Sharma of Green Portfolio in an interview to Moneycontrol.
The portfolio management and advisory firm believes that over the coming quarters, the IT sector will continue to face pressure on margins and from high attrition.
On the themes to track, with more than 13 years of experience in investment management in stock markets, Divam says sectors like pharma, chemicals, textile-garments, automobiles, cement, steel, and capital goods are showing good investment opportunities from near-term growth and valuations standpoint.
Excerpts from the interview:
Do you think the actual GDP growth for FY23 and FY24 would be higher than consensus expectations?
With the consumer confidence revival we are seeing in sectors like automobile, capital goods, and infrastructure, high capital inflow in the form of FPI and FDI capital, strong outlook for capex, manufacturing, and exports, India is going to witness the kind of growth that China had seen in the last 2 decades.
Do you think the risks to India story are far less from internal factors and largely emanate from global issues?
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India reflects a huge growth potential over this decade. Some key factors contributing to this opportunity include favourable demographics as India has a median age of below 30 with a high availability of efficient and cheap labour; infrastructure thrust that we have seen over the last few years specially in roads, ports, and power; ease of doing business efforts; favourable geopolitical relations and thrust towards local manufacturing through PLI (production-linked incentive), anti-dumping and other Government policies.
The global developments in terms of China plus one, and supply chain issues have added to the positives for India. We believe that the internal factors are the foundation for the India story and the external factors are the icing on the cake.
Do you expect a secular increase in energy and defence spending over the next few years?
Energy is attracting a lot of capital from large domestic corporates and global funds. The thrust on renewables will increase drastically over the coming years. Ethanol blending, transmission, renewables, electric vehicle (EV) batteries are the key themes where the world will be focusing.
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Domestic manufacturing and export for defense sector is a very interesting development to track. With a lot of talks and efforts being put towards the sector, we are finally seeing light at the end of the tunnel. This will be a good theme for investors over the coming years.
Do you think the travel and leisure segment is a strong catalyst to global growth going ahead?
We have seen a huge comeback for the sector over the last few quarters. This was also visible in the results of many hotel and travel-related companies. The growth in air traffic is strong, however, we are yet to reach the pre-Covid levels yet.
Foreign travel for leisure, education, and business has opened up and we are seeing huge growth there. This strong trend is going to continue and will drive GDP for a lot of economies going ahead.
Do you expect this year to be a year of consolidation for IT space?
This year seems to be a year of consolidation for the sector. The economic slowdown and potential recession in some of the developed nations will impact the sentiments and order flows for the sector. Also, we believe that over the coming quarters, the sector will continue to face pressure on margins and from high attrition.
What are the sectors that look attractive enough now?
Sectors like pharma, chemicals, textile- garments, automobiles, cement, steel, and capital goods are showing good investment opportunities from near-term growth and valuations standpoint. We are witnessing an above 20 percent capital expenditure to total expenditure and this also includes the impact of PLI related capex. Infrastructure implementation thrust, a positive outlook for manufacturing, exports, and consumption will drive investments over the coming quarters.
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Government, LIC may offer to sell 60% stake in IDBI Bank; EoI to be floated by October
The two currently own close to 94 percent in IDBI Bank, out of which the Centre owned 45.48 percent stake and LIC held 49.24 percent, as of June 30.
The Life Insurance Corporation (LIC) of India and the central government are likely to offer a 60 percent stake for sale in IDBI Bank, CNBC-TV18 reported on September 6. The Expression of Interest (EoI) for the divestment process will be invited by October.
It was earlier reported that LIC and the government could sell up to 65 percent stake in IDBI Bank. The two currently own close to 94 percent in IDBI Bank, out of which the Centre owned 45.48 percent stake and LIC held 49.24 percent, as of June 30.
The government will be seeking due diligence from the Reserve Bank of India (RBI) at every step in the divestment process.
There is no cap on promoter holding subject to submission of a plan to reduce stake in 15 years. However, the 26 percent voting rights cap stays for the divestment.
At the time of writing, the IDBI stock was trading at Rs 43.55 per share, about 0.46 percent higher.
The Government of India announced its intention to exit IDBI Bank in 2021. The disinvestment strategy refers to the liquidation or sale of the assets owned by the government.
Disinvestment is used as a technique by governments to reduce their fiscal burdens, and thus raise money for public needs. It can also be done to privatise the assets.
The stake sale of IDBI Bank has witnessed many ups and downs, and the process has been delayed quite a bit. The government had initially planned to invite the EoI in May, but the process got delayed due to its attempts to reach out to potential buyers as well as bidders.
Hyundai launches Venue N-Line at a starting price of Rs 12.16 lakh
With the Venue N Line, Hyundai has created a new niche by making a “sporty compact SUV” in India, the South Korean carmaker said
Hyundai India has launched the sportier version of the Venue sub-compact SUV the Venue N-Line at a starting price of Rs 12. 16 lakh (ex-showroom).
With the Venue N Line, the company had created a new niche by making a “sporty compact SUV” in India, the South Korean carmaker said. The bookings for the new SUV have opened across the country.
“Hyundai Venue N Line has been introduced to India as a part of our vision of redefining mobility experiences for customers and with this new launch, we will now offer 2 N Line models in a short span of two years, the Hyundai Venue N Line being our first compact SUV N Line model for India customers,” Unsoo Kim, MD & CEO, Hyundai Motor India Ltd, said at the launch.
The new car line takes cues from Hyundai’s ‘Sensuous Sportiness’, with a bold and dynamic aesthetic inspired by motorsport design, the company said in a release.
The car features a bold and sporty-looking dark chrome front grille with N Line Logo. It also features a Sporty N Line bumper with skid plates and roof rails with Red inserts.
The side profile of this SUV is characterized by R16 (D=405.6 mm) Diamond Cut Alloys with N Branding.
The line has been equipped with red front brake callipers, while the side sill garnish with red inserts add to the SUV’s sporty character, the release said.
The sporty tailgate spoiler gives the car a dynamic look. The SUV’s twin tip muffler builds on the SUV’s muscular and athletic imagery.
The Hyundai Venue N Line will also feature the N Line emblem on the tailgate, a feature unique to India.
The SUV is Powered by the 1.0 Kappa Turbo GDi petrol engine offered with a 7-speed DCT (dual clutch transmission).
The powertrain has been configured to provide a drive mode select (normal, eco, sport), so that the driver can switch between economical, balanced and thrilling power delivery settings.
The car comes with specific tuning to suspension (damping force increased to 34 percent), steering, exhaust sound and incorporation of all 4-disc brakes, thus the Hyundai Venue N Line delivers better control while cornering, offering a greater high-speed stability and enhanced ride quality.
The interior expresses a futuristic look, featuring elements that compliment the overall design theme of the exterior.
The Venue N Line features a 20.32 cm (8″) HD Infotainment System with Bluelink that lets you access a host of information while also offering smartphone connectivity with Android Auto & Apple Carplay.
It boasts of first in segment dashcam with dual camera to offer customers the ability to capture fun and exciting moments while on the move.
To ensure a sporty yet balanced driveability Hyundai offers over 30 safety features out of which 20+ safety features come as standard, thereby offering a surefooted drive experience.
Hyundai Venue N Line will be offered with 2 monotone options– shadow grey (new) and polar white and 3 dual tone options- thunder blue with phantom black roof, polar white with phantom black roof and shadow grey with phantom black roof.
India gives coal-fired plants extra two years to install emissions equipment
Indian cities have some of the world’s most polluted air. Thermal utilities, which produce 75% of the country’s power, account for some 80% of industrial emissions of sulphur- and nitrous-oxides, which cause lung diseases, acid rain and smog.
India extended a deadline for coal-fired power plants to install equipment to cut sulphur emissions by two years, the government said in a notification on Tuesday, marking the third push back on a commitment to clean up dirty air.
Indian cities have some of the world’s most polluted air. Thermal utilities, which produce 75% of the country’s power, account for some 80% of industrial emissions of sulphur- and nitrous-oxides, which cause lung diseases, acid rain and smog.
India had initially set a 2017 deadline for thermal power plants to install flue gas desuphurisation (FGD) units to cut sulphur emissions. That was later changed to varying deadlines for different regions, ending in 2022, and further extended last year to a period ending 2025.
The order on Tuesday said power plants will be forcibly retired if they do not comply to norms on sulphur emissions by end-2027.
Plants near populous regions and the capital New Delhi will have to pay penalties to operate from end-2024, while utilities in less polluting areas will be penalized after end-2026, the order said.
The federal power ministry had pushed for an extension, citing higher costs, lack of funds, COVID 19-related delays and geopolitical tension with neighbouring China, which has restricted trade.
The delay will be welcomed by operators of coal-fired utilities including private companies, like Tata Power and Adani Power, which have long lobbied for less severe requirements.