TCS, India’s largest IT services company, kicked off the earnings season for the country’s outsourcing industry with disappointing results. The company reported a net profit of Rs 11,342 crore, an annualized increase of nearly 9%, for the quarter ending in September. However, both the net profit and revenue of Rs 59,692 crore fell below analysts’ expectations. TCS also announced a buyback of Rs 17,000 crore at Rs 4,150 per share.
The performance of TCS is closely watched as a barometer for the industry’s outlook, and the company’s warning of delayed decisions and reduced client spending reflects the challenges faced by the global IT industry.
The Indian government has decided to hold off on expanding the production-linked incentive scheme until it assesses the effectiveness of existing initiatives. The scheme, launched three years ago with an allocation of Rs 1.97 lakh crore, aims to boost domestic manufacturing and attract investments. However, only a few of the 14 sectors included in the scheme have shown promising results.
Ranjan Pai, chairman of the Manipal Education and Medical Group, is considering investing $250-300 million in Aakash Institute, a unit of troubled edtech start-up Byju’s. This investment would provide much-needed relief to Byju’s, which plans to use the funds to retire debt.
Naveen Jindal, promoter of Jindal Steel and Power, has expressed interest in buying insolvent airline Go First. It is unclear whether Jindal is looking to acquire the airline outright or become a strategic investor. This potential acquisition could provide a breakthrough solution for Go First, which has struggled to secure funding from lenders due to litigation by aircraft lessors.
Despite escalating tensions between India and China, the People’s Bank of China continues to hold shares worth at least Rs 25,000 crore in major Indian companies. The bank has kept its holdings below the 1 percent threshold to prevent any backlash.
The Union cabinet has approved royalty rates for strategic minerals such as lithium, niobium, and rare earth elements. This move paves the way for the government to auction mining blocks containing these critical minerals for the first time. These minerals play a crucial role in economic development and energy security as India strives to achieve net-zero emissions by 2070.
JSW Steel and ArcelorMittal, along with private equity funds, are interested in acquiring the iron ore mines and steel plant owned by ESL Steel, a part of Vedanta. The Vedanta Group is seeking funds to repay its debt, and potential buyers are negotiating for a reduced valuation.
The Securities and Exchange Board of India is investigating the relationship between the Adani Group and Gulf Asia Trade & Investment to determine if there has been a violation of share ownership rules. The Adani Group has denied any wrongdoing.
Canadian investment firm Alberta Investment Management Corporation and others are interested in acquiring a minority stake in Aditya Birla Group’s renewable energy business. This investment will help the conglomerate expand its renewable capacities and support its decarbonization plans.
In conclusion, several key developments have shaped the business landscape in India. From the disappointing earnings of TCS and the government’s evaluation of the production-linked incentive scheme to potential investments in troubled companies and the ongoing investigations into corporate activities, these stories highlight the challenges and opportunities in the Indian market.
Sources:
– [TCS starts earnings season on disappointing note](source1)
– [Government to evaluate production-linked incentive scheme](source2)
– [Manipal chairman Ranjan Pai may invest $250-300 million in Akash Institute](source3)
– [Jindal Power submits expression of interest to buy insolvent Go First airline](source4)
– [People’s Bank of China continues to own Indian shares worth Rs 25,000 crore](source5)
– [Union cabinet approves royalty rates for strategic minerals like lithium and rare earths](source6)
– [ArcelorMittal and JSW Steel lead race to acquire mines and steel assets of Vedanta](source7)
– [India’s market regulator investigating between Adani Group and Gulf Asia fund](source8)
– [Canadian investment fund and others seek to buy stake in Aditya Birla Renewables](source9)
– [Corporate India unlocks value of subsidiaries through mergers](source10)
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