Bajaj Auto Q2FY25 Financials: Strong Revenue and Profit Growth, Margins Improve

Introduction

Finally, India is getting its first semiconductor facility. Vedanta and Foxconn, a Taiwanese electronics manufacturing firm, would spend 1.54 lakh crore. Foxconn is the technical partner, while Vedanta, an oil-to-metals giant, is funding the project. The country's first chip factory will be built on a 1000-acre plot of land in Ahmedabad, Gujarat.

Geopolitical concerns with China, as well as a global shortage of semiconductors, have driven Countries such as the United States are increasing domestic manufacturing capacity in order to lessen their reliance on imports to restore global dominance. The United States has supposedly laid aside vast quantities of money and is seeking alliances with other countries.

Vedanta following the agreement of a 60:40 joint venture with Foxconn will own 60% of the shares in the joint venture, while Foxconn will own 40%. In the following two years, the joint venture plans to establish a semiconductor manufacturing unit. Vedanta and Foxconn will construct three units: a semiconductor fabrication unit, a display fabrication unit, and a semiconductor assembling and testing unit.

This new facility will signal the start of semiconductor manufacture in India. This is also vital for India since it reduces our reliance on other countries. The planned semiconductor manufacturing fab unit would use 28nm technology nodes and 300mm wafers, while the display manufacturing unit will create Generation 8 displays for small, medium, and large applications.

The Vedanta group would invest Rs 1.54 lakh crore to establish two plants in Gujarat. Vedanta Displays Limited would invest Rs 94,500 crore in a Display Fab Unit, while Vedanta Semiconductors Limited will invest Rs 60,000 crore in an integrated Semiconductor Fab Unit and an OSAT (outsourced semiconductor assembly and test) facility.

The proposed investment by the Vedanta and Foxconn Group in the establishment of India's first display manufacturing fab unit and an Integrated Semiconductor fab unit with an OSAT facility would aid in the development of upstream and downstream electronics manufacturing clusters, as well as trade links. The Vedanta and Foxconn Groups will collaborate closely with the state government to develop high-tech clusters with the necessary infrastructure, including land semiconductor grade water, high-quality power, logistics, and a skill ecosystem.

Semiconductor Industry Growth

Semiconductor chips, sometimes known as microchips, are crucial components of many digital consumer items, which are used in automobiles, mobile phones, and other electronic gadgets, and are not currently made in India. Currently, Taiwan manufactures 8% of all chips used in the globe, followed by China and Japan.

In 2021, the Indian semiconductor industry was valued at $27.2 billion, and it is predicted to rise at a high CAGR of about 19% to $64 billion by 2026. However, none of these chips are currently made in India.

India now boasts 70,000 startups, including 100 unicorns, and the country has surpassed China to become the world's second-largest mobile phone manufacturer. Indian industries produce electronics worth Rs USD 80 billion, or about Rs 6,00,000 crore.

Impact

Last year, a significant shortfall in the semiconductor supply chain impacted a wide range of sectors, including electronics and automobiles.

Other Steps taken

Aside from Vedanta, a consortium led by Dubai-based NextOrbit and Israeli technology firm Tower Semiconductor has agreed to establish a facility in Mysuru, while Singapore-based IGSS Venture has picked Tamil Nadu as the location for its unit.

Conclusion

This is the largest business investment in independent India's history. This Memorandum of Understanding is a crucial step in accelerating India's chip manufacturing ambitions. The government has announced four programs totaling Rs 76,000 crore in order to position India as a worldwide semiconductor chip manufacturing powerhouse.

The Rs 1.54 lakh crore investment will have a huge influence on the economy and employment creation. This would also benefit our MSMEs by creating a large ecosystem for ancillary businesses. The two planned projects would provide around 1 lakh new job opportunities in the state.

फेड द्वारा दरों में बढ़ोतरी के बाद पिछले सप्ताह बुलियन की कीमतों में अस्थिरता रही और निवेशकों की अपेक्षा से अधिक आक्रामक फेड का रुख रहा जिसमे उन्होंने ब्याज दरों को साल के अंत तक 4 प्रतिशत के ऊपर रखने की बात कही। हालांकि, अमेरिकी फेड की आक्रामक मौद्रिक नीति के चलते भारतीय रूपया अब तक के निचले स्तरों 1 डॉलर का मूल्य 81 रुपये पर पहुंच गया है, जिससे घरेलु वायदा बाजार में सोने के भाव पिछले सप्ताह 1000 रुपये प्रति दस ग्राम तक तेज़ हुए। एमसीएक्स अक्टूबर वायदा सोना पिछले सप्ताह 0.8 प्रतिशत तेज़ हो कर 49700 रुपये प्रति दस ग्राम के स्तरों पर रहा। जबकि कॉमेक्स में सोने के भाव सप्ताह में 0.80 प्रतिशत टूट कर 1670 डॉलर प्रति औंस के स्तरों पर रहे। कठोर मौद्रिक नीति के चलते अमेरिकी बेंचमार्क ट्रेज़री यील्ड बढ़ कर 3.7 प्रतिशत हो गई है जिससे अमेरिकी डॉलर इंडेक्स  पिछले सप्ताह 2 प्रतिशत तेज़ हो कर 111.80 के स्तरों पर पहुंच गया है। फेड के साथ बैंक ऑफ़ इंग्लैंड द्वारा भी ब्याज दरें बढ़ाई गई है जबकि बैंक ऑफ़ जापान ने अपनी ब्याज दरों में कोई बदलाव नहीं करने के साथ अपनी मुद्रा के अवमूल्यन को रोकने के कदम उठाए है। सोने के लिए निकट-अवधि में तेज़ी का दृष्टिकोण, अमेरिकी ब्याज दरों में वृद्धि की संभावना से बाधित है, जिसने डॉलर को बढ़ावा दिया और इस साल बुलियन की कीमतों को रिकॉर्ड ऊंचाई से नीचे गिरा दिया है। फेड द्वारा कठोर नीति में ढील देना 2024 से शुरू किया जायेगा जबकि निकट अवधि में आक्रामक मौद्रिक नीति से आर्थिक मंदी का खतरा बना हुआ है, जो सोने की सुरक्षित आश्रय की उपाधि को बनाये रखेगा।

तकनीकी विश्लेषण

इस सप्ताह कीमती धातुओं में भारतीय त्यौहारो के चलते निचले स्तरों पर सपोर्ट रहने की सम्भावना है। अक्टूबर वायदा सोने की कीमतों में 48400 रुपये पर सपोर्ट है और 50300 रुपये पर प्रतिरोध है। दिसंबर वायदा चांदी में 54000 रुपये पर सपोर्ट और 58500 रुपये पर प्रतिरोध है।

Bajaj Finserv Ltd has announced a 5:1 Stock Split and 1:1 Bonus Shares

The board of directors of Bajaj Finserv Ltd has approved and announced a 5:1 stock split and 1:1 bonus shares. Following the stock split, the company's authorized share capital would increase to 1 billion equity shares with a face value of Rs. 1 each. The number of fully paid and subscribed shares will grow to 9.64 crores at the same face value. The authorized capital will eventually increase to 2 billion equity shares with a face value of Re 1 following the issuing of bonus shares. A total of 1.59 billion Re 1 share will be added to the total paid-up and subscribed capital.

Let us First Understand What is a Stock Split?

A corporation may decide to split its shares into a number of new ones in a stock split. Split shares do not diminish the shareholders' ownership position or create any new value for them. However, what they actually do is increase the number of shares of the company. Meanwhile, the face value of the shares is reduced during a split. However, the investment's overall worth stays constant.

The major advantage of a stock split is that it makes the share price more affordable for retail investors. This indicates positive sentiment of the share. Since shares are now more readily available to regular investors, there will likely be a greater demand for them, which will enhance the amount of liquidity on the market.

Why has Bajaj Finserv considered a Stock Split?

The company's business has expanded substantially over the years, and this is reflected in the share price. Bajaj Finserv's share price reached Rs 19,325 in October 2021. 98% of the total number of its shareholders are retail investors. The company signaled that it would become more challenging for retail investors to buy even a single share if the price rose from its current levels. In order to make shares more affordable to retail investors, the company is splitting shares.

What is a Bonus Issue?

An offer of free extra shares to existing shareholders is known as a bonus issue, often referred to as a scrip issue or a capitalization issue. As an alternative to increasing the dividend payout, a firm may elect to distribute more shares. Bajaj Finserv for instance provides one bonus share for one share owned.

Who is eligible for the Bajaj Finserv stock split and bonus share?

Investors who owned Bajaj Finserv prior to the record date are eligible for the stock split and bonus shares.

But what if you buy a share on 12 Sep? Since our system follows a t+2 settlement cycle you can get shares in your portfolio through a demat account by September 14, making you eligible for the bonus and the split.

Understanding its Financials:

Positives

1. The company has had a ROA of 11.56% during the past three years.

2.The company's operating income increased considerably during the last three years, with a CAGR of 13.82%.

3.Promoters own 60.76% of the stock.

4. The consolidated net profit of Bajaj Finserv for the three months ending in June 2022 increased by 57% to Rs 13.1 billion.

5. The Bajaj Group firm reported a profit of Rs. 8.3 billion last year.

6. The reviewed quarter's revenues totaled Rs 158.9 bn, an increase of 145 year-on-year growth (YoY).

7. Its subsidiary Bajaj Alliance's gross written premium climbed by 255 to Rs 31.2 billion during the quarter.

Negatives

1. The stock price is trading at 62.81 times the book value.
2. The PAT margin decreased by 30.29%.

Status of Bajaj Finserv Share

The share price of the stocks reached a 52-week high of Rs. 19325 a share in October 2021. On June 30, 2022, the 52-week low was Rs. 10727. Bajaj Finserv delivered has delivered, a 5-year return of about 204 percent. Moreover, it delivered returns of more than 2600 percent from the original stock price of Rs. 500 to Rs. 1790.

Inox Green Energy Services, a subsidiary of Inox Wind, intends to raise Rs 740 crore through an initial public offering (IPO) by October of this year.

On February 7, 2022, IGESL stated that it has filed a draft red herring prospectus with the Securities and Exchange Board of India, but withdrew it in April for unclear reasons. Inox Green Energy submitted its second draft red herring prospectus in June.

The proposed Offer comprises a Fresh Issue of Equity Shares worth up to Rs. 370 crores. and an offer to sell Equity Shares worth up to Rs. 370 crores.

The company received the observation letter on September 13. Before bringing an IPO, it is necessary for any company to get an observation letter. The company may also consider pre-IPO placements. If such placement is completed, the size of the new issue will be reduced.

Objective

After establishing itself in the Indian industry, the company intends to expand into the international market whether in South East Asia, the Gulf, or Africa.

Inox Wind will be debt-free following its Rs 740-crore initial public offering.

About Inox Green Energy Services

Inox Green Energy Services provides long-term Operation and Maintenance (O&M) services for wind farm projects, especially for Wind Turbine Generators (WTGs) and common infrastructure facilities on wind farms that facilitate power evacuation from such WTGs.

Inox Green Energy Services is now growing at a rate of 30-40% every year. Today, the volume for Inox Green Services is close to Rs 160 crore, and it is expected to reach Rs 400-500 crore in the next 3-4 years.

Inox Wind Updates

It has borrowed Rs 300 crore for the Nani Virani project, which is now being constructed by Inox Wind. It has also got an advance payment of Rs 850 crore from its important customer, a group firm.

The business would also sell its stake in the Rs 350-crore SPV before the IPO, with net proceeds of Rs 100 crore from the transaction. Aside from that, it will receive little more than Rs 200 crore from the conversion of previously issued warrants.

Meanwhile, Inox Wind said that at its next Annual General Meeting (AGM) on September 28, it will seek shareholder permission to fund up to Rs 200 crore through the issuing of 20 crore preference shares to its holding and promoter business Inox Leasing and Finance for cash.

According to the company's notice for the AGM, the board of directors approved the issuance of up to 20 crore 0.01 percent non-convertible, non-cumulative, participating, redeemable preference shares with a face value of Rs 10 each for an aggregate value not exceeding Rs 200 crore to Inox Leasing and Finance Ltd at its meeting on August 30, 2022.

It further stated that the business intends to enhance its authorized share capital from Rs 110, 11, 00,000 to Rs 310, 11, 00,000 to facilitate the issuing of preference shares.

Last year in October, Oyo parent company Oravel Stays Ltd filed a draft red herring prospectus (DRHP) with SEBI to launch an Rs 8,430-crore IPO

The prospectus was approved in January of this year, and the IPO is slated to start soon.

OYO submitted its DRHP with SEBI in October of last year and has now requested permission to file its financial accounts for FY22.

About OYO

OYO is an online marketplace for travelers to locate hotels and other places to stay. Ritesh Agarwal founded OYO in 2013 to aggregate and standardize services given by budget hotels and hostels across India. OYO Hotels and Homes manages India's largest hotel network.

About the IPO

The intial public offering includes a fresh issuance of shares worth Rs 7,000 crore and an offer-for-sale (OFS) by existing shareholders for Rs 1,430 crore. The business also stated that it will explore offering shares worth up to Rs 1,400 crore in a pre-IPO placement.

According to the sources, SoftBank, which owns 48% of OYO, will decrease its interest in the business, and its share sale would likely account for the majority of the OFS. A1 Holdings Inc (Grab) and China Lodging are two other investors that are expected to sell their IPO stakes.

The issue's global coordinators and book running lead managers are Kotak Mahindra Capital Company, JP Morgan India Private Ltd, Citigroup Global Markets India Private Ltd, ICICI Securities, Nomura Financial Advisory and Securities, and JM Financial Ltd.

OYO is aiming to cut the amount of its IPO from $1.2 billion to $800 million.

Negative market sentiment, pandemic challenges, and investor withdrawal have prompted the business to seek a lower valuation of $7 billion to $8 billion.

Objective

The offer consists of a new issue and an OFS totaling 84,300 million. The proceeds from the IPO will be utilized to reduce the company's debt and for other corporate reasons.

The fresh issue component of 70,000 million rupees would be used for repayment/prepayment of certain debt availed by their subsidiaries, 29,000 million rupees would be used for funding their organic and inorganic growth initiatives, and the remainder of the fresh issue would be used for general corporate purposes. The OFS is $14,300 million, with the proceeds going straight to the selling stockholders.

Strong Growth Momentum

OYO reported a 47% increase in monthly gross book value per hotel in Q1 FY23 compared to the previous fiscal quarter.

In Q1 FY23, OYO recorded revenue from operations of Rs 1,459.3 crore.

The company's Adjusted Gross Profit Margin has steadily increased from 33.2% in FY21 to 40.1% in FY22 and 41.3% in Q1 FY23.

Adjusted profits before interest, taxes, depreciation, and amortization (EBITDA) for the first quarter were 72.66 million Indian rupees (IPO).

Oyo recorded a loss of 18.9 billion rupees ($237 million) for the fiscal year ending March 2022, substantially lowering the previous year's loss of 33.83 billion rupees in 2021

The addendum filed by OYO shows that in the first quarter of FY23, i.e. April, May, and June, the company's sales increased and losses have come down. Gross booking value (GBV) was 24.87 billion rupees in the June quarter and 81 billion rupees in fiscal 2022, up 22% from the previous year.

OYO's revenue from operations in the first quarter stood at Rs 1,459.3 crore. The firm has registered a growth of 47% in gross booking value per hotel in Q1FY23. It stood at Rs 3.25 lakh, which was Rs 2.21 lakh in FY22.

Revenue from customer contracts grew 21% to 47.8 billion rupees for the fiscal year ending March 2022

OYO claimed that its general and administrative expenses have come down by 44.4% in FY22. In FY22, it became 515.4 crores, which was Rs 927 crores in FY21. Employee expenses also declined by 26.5% to Rs 1,117.2 crore from Rs 1,520.4 crore in FY21. Oyo said its 'storefronts' stood at 1.68 lakh at the end of Q1FY23, from around 1.57 lakh at the end of FY21.

Conclusion

Last year, the hotel-booking start-up Oravel Stays announced that it has sustained net losses every year since its inception and that its capacity to attain profitability may be delayed because of the economic consequences of the epidemic.

But now SEBI may consider the IPO document of OYO Hotels after the submission of financials for the second quarter. Considering this speed, OYO Hotels can launch its IPO by the fourth quarter of FY23. OYO submitted its DRHP with SEBI in October of last year and has now requested authorization to file the financial accounts for FY22.

Negative market sentiment, pandemic headwinds, and investor withdrawal have caused the business to seek a lower valuation of $7 billion to $8 billion. Book your IPO today!

बढ़ती हुई महंगाई को नियंत्रित करने के लिए यूरोपियन सेंट्रल बैंक द्वारा पिछले सप्ताह ब्याज दरों में 0.75 प्रतिशत की बढ़ोतरी कर दी गई जिससे यूरो सप्ताह में 1.5 प्रतिशत तेज़ हुआ और अमेरिकी डॉलर इंडेक्स, जिसमे यूरो का वेट 57.6 प्रतिशत  है, सप्ताह में 1 प्रतिशत टूट गया। डॉलर में 20 साल की उचाई से गिरावट के कारण सोने और चांदी के भाव में तेज़ी रही। यूरोपीय सेंट्रल बैंक द्वारा अपेक्षा से अधिक दर में वृद्धि के बाद यूरो के दबाव के बावजूद, फेड प्रमुख पॉवेल की टिप्पणियों ने डॉलर को 20 साल के उच्च स्तर के करीब रखा जिसके कारण सोने की तेज़ी सीमित रही। एमसीएक्स में पिछले सप्ताह सोने के भाव 0.60 प्रतिशत जबकि चांदी 5 प्रतिशत तक तेज़ हुई है। केटो इंस्टीट्यूट के वार्षिक मौद्रिक सम्मेलन के एक संबोधन के दौरान फेड चेयर जेरोम पॉवेल द्वारा केंद्रीय बैंक के कठोर रुख को दोहराया और पॉवेल ने शपथ ली है कि जब तक मुद्रास्फीति अपने 2 प्रतिशत लक्ष्य के भीतर नहीं हो जाती, फेड आक्रामक रूप से नीति को सख्त बनाए रखेगा। फेड द्वारा मौद्रिक नीति पर सख्ती, आने वाले कुछ समय के लिए कीमती धातुओं की तेज़ी को सीमित रख सकता है। हालांकि, भारतीय बाज़ारो में त्यौहार का सीजन शुरू होने वाला जिससे सोने और चांदी की मांग में बढ़ोतरी होने के आसार है। त्योहारों के बीच कीमती धातुओं के सस्ते भाव कीमतों में बढ़ोतरी कर सकते है।

तकनीकी विश्लेषण:

इस सप्ताह कीमती धातुए सीमित दायरे में रहने की सम्भवना है। अक्टूबर वायदा सोने की कीमतों में 50000 रुपये पर सपोर्ट है और 51100 रुपये पर प्रतिरोध है। दिसंबर वायदा चांदी में 54000 रुपये पर सपोर्ट और 56000 रुपये पर प्रतिरोध है।