IndiGo Breaks Records and Probably a Few Clouds!

Friday, June 16^th 2023

Good Morning ☕

Wow, it seems like the Indian skies are getting as crowded as a Mumbai local train at rush hour! With a 36% year-over-year increase in domestic air traffic, it's safe to say that Indians are taking off with enthusiasm. With IndiGo soaring high, I wouldn't be surprised if their next upgrade is installing traffic lights at 35,000 feet! Watch out birds, you've got some serious competition up there.

1. India's May trade deficit widens to 5-month high of $22 billion

India's trade deficit widened to a five-month high of $22 billion in May 2023, with merchandise exports falling 10.3% to $57.10 billion and imports declining 6.6% to $34.98 billion. Meanwhile, a consortium led by Titagarh Rail Systems Limited and Bharat Heavy Electricals Limited signed a contract with Indian Railways to manufacture 80 Vande Bharat sleeper train sets by 2029. The contract is worth around Rs 25,000 crore.

2. May aviation data: Domestic air traffic jumps 36% on year

According to data released by the Directorate General of Civil Aviation (DGCA), domestic air passenger traffic in India climbed by 36% YoY in May 2023, with a total passenger footfall of 14.18 million. IndiGo, the country's largest carrier in terms of market share, increased its market share to over 60% in May 2023. The airline's load factor improved to 91.5% in May from April's 87.4%. The growth in domestic air traffic is attributed to the easing of COVID-19 restrictions and the increasing demand for air travel in the country.

3. Infra financier NaBFID raises ₹10,000 crore in maiden bond issue

India's National Bank for Financing Infrastructure and Development (NaBFID) has raised INR 10,000 crore ($1.3 billion) in its maiden bond issue, which was oversubscribed by 4.5 times. NaBFID was set up by the Indian government in 2021 to provide long-term finance for infrastructure projects. The bank plans to lend close to INR 1 trillion ($12.23 billion) this fiscal year, with INR 450 billion ($5.5 billion) already sanctioned. NaBFID will raise about INR 300 billion ($3.7 billion) through bond sales this financial year, with the first issue of between INR 50-100 billion ($610 million-$1.2 billion).

4. Titagarh Wagons-BHEL consortium inks ₹24,000 cr contract with Indian railways

Titagarh Rail Systems-BHEL consortium has won a contract from Indian Railways to manufacture 80 Vande Bharat sleeper train sets by 2029. The estimated value of the contract is Rs 23,000 crore ($3.1 billion). The consortium will manufacture, test, commission, and supply 80 energy-efficient Vande Bharat Trains at their manufacturing facilities in West Bengal. The Vande Bharat trains represent a significant advancement for Indian Railways under the Make in India initiative. The consortium is the only fully Indian entity eyeing the Rs 72,000 crore ($9.7 billion) Vande Bharat contract.

5. India summer power demand seen manageable, govt measures in place: JP Morgan

According to JP Morgan, India's summer power demand is manageable and the government has measures in place to deal with it. The government has ramped up coal stocks to alleviate energy shortage fears caused by the energy crisis. The power ministry has constituted a core management team to manage coal stocks and ensure equitable distribution. Coal continues to be the primary fuel for electricity generation in India, accounting for about 70% of the total.

6. India’s merchandise exports cross $100 bn in March quarter, says report

India's merchandise exports crossed $100 billion in the March quarter, with the highest monthly value of merchandise export in March 2022 amounting to $40.38 billion, an increase of 14.53% over the previous year. India's overall exports, including merchandise and services, are projected to grow at 13.84% during FY 2022-23 over FY 2021-22 to achieve $770.18 billion worth of exports. In the fiscal year ending March 31, 2023, India's exports of merchandise and services rose by 6%, while imports from Russia surged. Hindustan Power Exchange crossed the trade milestone of 2.5 billion units within eight months of its launch.

7. Spandana Sphoorty rejects report on stake sale to YES Bank

Spandana Sphoorty, a microfinance lender, has denied reports of a stake sale to Yes Bank. The company's shares had surged 20% on Tuesday on rumors of a stake sale to Yes Bank. However, Spandana Sphoorty has denied the reports, stating that it is not in talks with Yes Bank for any stake sale. Yes Bank has been in the news for its stake sales in the past, including a deal to sell a minority stake to a global technology company in 2019.

8. Adani Green tops in Asia for ESG performance: Report

Adani Green Energy Limited (AGEL), the renewable energy arm of the Adani Group, has been ranked first in Asia and among the top 10 companies globally in the renewable energy sector for ESG (Environmental, Social, and Governance) performance by ISS ESG, the responsible investment arm of Institutional Shareholder Services. AGEL has been placed in the ‘Prime’ (B+) band, recognizing its robust ESG disclosure practices and transparency. AGEL has also been ranked in the world’s top 10 companies in the renewable energy sector by Sustainalytics in FY23. The company aims to be among the top 10 companies of the world in the ESG benchmarking of the electric utility sector by FY25.

9. Hindustan Power Exchange crosses 5 billion units trade within 11 months of launch

Hindustan Power Exchange (HPX) has announced that it has traded over 5 billion units of power within 11 months of its launch. HPX is a platform for trading electricity, and it has seen a rapid increase in trading volume across segments. The platform crossed the 2.5 billion units of trade mark within eight months of its launch. HPX's achievement is significant as it shows the growing demand for electricity trading in India.

10. Coal stocks rise 44% to 110.58 million tonne: Government

India's coal stocks have risen by 44.2% to 110.58 million tonnes due to effective stock management strategies implemented by the Ministry of Power. The government has ramped up coal stocks at power plants to alleviate energy shortage fears caused by the energy crisis. The power ministry has constituted a core management team to manage coal stocks and ensure equitable distribution. A 10% increase in coal supply can augment the coal power crisis. Coal continues to be the primary fuel for electricity generation, accounting for about 70% of the total.

11. India to lose 6,500 HNIs in 2023

India is expected to lose 6,500 high-net-worth individuals (HNWIs) in 2023, according to a report by Henley & Partners. However, the country's HNWI population is projected to experience an 80% increase by 2031, positioning India as one of the fastest-growing wealth markets in the world. Meanwhile, Adani Green Energy Limited (AGEL), India's largest renewable energy producer, has been ranked first in Asia and among the top 10 companies globally for ESG performance by Institutional Shareholder Services ESG and Sustainalytics.

12. RBI rule allowing banks to compromise with wilful defaulters is misguided

The Reserve Bank of India (RBI) has allowed wilful defaulters and loan accounts involved in frauds to go in for a compromise settlement, which has been criticized by bank unions. Two of India's largest bank employee unions have urged the central bank to review and withdraw its recent decision to allow compromise settlements for wilful defaulters, saying that such a move would hurt the integrity of the banking system. The compromise settlement for fraud accounts is an "affront" to the principles of justice and accountability, they said. The RBI's move came as a "shocker" and rewards unscrupulous borrowers, they added.

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