CAPEX
Hindalco to spend nearly $7 billion on capex in 3-5 years
Hindalco Industries plans to invest $7 billion in capital expenditure over three-five years, focusing on Novelis and Hindalco India. The Bay Minette facility in North America, costing $4.1 billion, will enhance production capacity for beverage cans and automotive-grade aluminium sheets. Long-term agreements with major customers like Coca-Cola are in place. Novelis will also invest in recycling centers in North America and South Korea.
A play on revival of capex cycle: 5 PSU banks with an upside potential of up to 36%
After a gap of almost three months, PSU banks witnessed an across the board up move. If one looks deeper, even in the last three months of correction or rather consolidation, the cut in PSU stocks was not very high. They moved in a sideways range. This is very different if one takes into account how the stock used to lead the correction earlier. The re-rating of PSU banks has to be divided into three parts, the first part which was about clean up of the banking system which was full of NPA brushed under the carpets and they got cleaned up and their balance sheets became more reliable. Second part was mergers which meant improvement in the operational efficiency. Now it is the third part, which is more important, growth and that too profitable growth. Is now the street getting ready to re-rate them because of loan book growth, which is showing green shoots due to the capex cycle starting back
Budget 2024 retains focus on capex, infra creation for a foundation for future
The first budget of PM Narendra Modi's third term has focused on fiscal consolidation, and this should help build a strong foundation for the future and achieve the goal of building a Viksit Bharat. Capex spending and infrastructure creation are among the success stories of this government.
Pavna Industries to take QIP route to fund capex plans and reduce debt
The move aims to reduce its debt and finance capital expenditures. The fundraising will occur in two-three tranches over the next 12-18 months. The formal announcement is expected in a few days. According to the sources mentioned above, the company has approached several bankers for the fundraising process and discussions with ICICI Securities are in the final stage.
FM Nirmala Sitharaman clears air on the budget proposals that got everyone talking
In a detailed interview, the Finance minister discusses the moves made in Budget -- from politics to reforms and the broader economy.
Financialization a mega trend; it is here to stay: Ajay Bagga
What happened in the COVID period, there was a gamification. The trading became a video game. You got access through online brokerages and the cost of access with this zero brokerage without realising the STT, the GST in terms of IGST, the exchange charges, the government charges, the stamp duty, all those if you add in it was a hefty sum as well.
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Budget 2024 reinforces multiple positives; good macro conditions expected to continue: Shreyash Devalkar
Regarding the consumption part of the economy, the market was probably expecting more. However, some state budgets have announced spending measures that may support consumption. Although the central budget didn't show much in this regard, policies related to job creation, transfers to states, and rural housing schemes are definitely going to support the consumption sector as well. Overall, this budget broadly reinforces the previous stance.
Market leadership will revert to banks & IT; days of capex, defence stocks over: Samir Arora
For two-three years, Helios was zero in IT and bought some of these infra type railway and defence stocks . All those are relatively over now, says Samir Arora. Even a very good Budget with very good tax or no change in tax or whatever could have kept railway and defence stocks up beyond plus-minus a few months.
India's Budget 2024-25 focuses on ambitious capital expenditure, decarbonisation initiatives
The Indian government's 2024-25 Budget significantly boosts infrastructure allocation, focusing on energy transition. With $133 billion in capital expenditure, it targets roads, railways, and power projects. Key initiatives include rooftop solar installations, a Pumped Storage Policy, the National Green Hydrogen Mission, and EV support. This will drive deal activity and require substantial private equity and project finance.
Infra allocation, support to startups to boost innovation in steel sector, create jobs: ISA
The increased R&D funding and support for startups and MSMEs in the Budget will foster innovation in steel manufacturing, according to the Indian Steel Association. The Rs 11.11 lakh crore allocation aims to enhance infrastructure, create jobs, and benefit the steel industry. Emphasis on roads, railways, ports, and urban development will boost steel demand and productivity.
Should market be worried about frothiness in some PSU stocks? Hiren Ved answers
If you add 15,000 crores that has been given to Andhra plus another 26,000 crores that has been allocated to Bihar, which are also in turn for infrastructure projects. There is ultra mega power plant in AP. There are irrigation facilities to be set up in AP and there is allocation for roads for Bihar and therefore in many senses while it may seem that, oh, this is for two states, but if you add 15 and 26 that is another capex allocation that has happened.
That shrinking feeling of ‘do nothing’: The trend of a revenue-constrained GoI with low tax and disinvestment ambitions continues
The central government’s budget is shrinking, with declining TE/GDP ratios except for a COVID-induced spike in FY21. Post-pandemic, fiscal deficit reductions have come from expenditure cuts as revenue-GDP ratios stagnate or fall. Revenue shortfalls hindered fiscal consolidation. Minor revenue gains in FY23 and FY24 allowed for moderate expenditure cuts. The FY25 budget aims to cut the fiscal deficit by 0.7%. Despite optimism, tax buoyancy remains low, and disinvestment targets underperformed, influencing fiscal strategies. Non-tax revenue increases from public sector dividends are part of the strategy, but overall public sector capex remains flat, impacted by the BSNL bailout.
India Capex Budget: Sitharaman makes no change in the capex, target remains Rs 11.11 lakh crore for FY25 to boost infra
Union Budget 2024 Infrastructure Funds: Finance Minister Nirmala Sitharaman has proposed to maintain the capital expenditure target at Rs. 11.11 lakh crore for the fiscal year 2025. The government aims to support infrastructure and economic growth through strong fiscal backing. This decision aligns with the goal of making India the third largest economy and stimulating job creation.
It’s a great Budget; a lower cost of capital over time leads to more capex and faster growth: Prashant Jain
Prashant Jain of 3P Investment Managers praised the Budget for equitable taxation, capex growth, and fiscal progress. Noting job creation, Rs 1 lakh crore for urban housing, and taxation reviews, he emphasized the ease of doing business and the small midcaps market correction. Despite high risk-reward in manufacturing and defense, Jain sees continued potential in PSUs and power sectors.
Budget 2024: Capital goods stocks tank up to 8% after Sitharaman makes no change in capex
Stocks of capital goods giants nosedive up to 8% on BSE as Finance Minister maintains massive expenditure target. Government's bold move sparks fears and excitement in the market. Experts weigh in on the impact of this decision on India's economic growth and job creation.
Budget 2024: Expecting incremental shift towards RevEx & continued thrust on capex: Ravi Dharamshi
Ravi Dharamshi expects the Budget to stress revenue expenditure, capex, rural distress, PM Awas Yojana, energy transition, and private sector capex. With state elections approaching, supply chain shifts, potential new PLI scheme sectors, and measures to boost the middle class, he predicts government actions will stimulate the real estate cycle and increase market volatility.
CEAT lines up ₹1k-cr capex in FY25, flags margin woes
RPG Group’s CEAT has a ₹1,000 crore capex to counter rising natural rubber and freight costs, with staggered 1.5-2.5% price hikes and an additional 5-6% expected. Margins dropped 300 basis points in June and remain pressured in the second quarter. Investments improve R&D, IT, and factory efficiency, expand specialty tyres at Chennai and Ambernath, and de-bottleneck Halol.
India Playbook 2024 – Budget FY25 to focus on affordable housing
One big change in the final budget could be an increase in rural expenditure including higher spends on affordable housing. RBI’s extraordinary dividend of Rs 2.1 lakh crore and impressive tax collections give the government the power to increase expenditure and still stick to its prudent policy of lowering the fiscal deficit.
Why DBS Bank strategist Joanne Goh prefers smallcap and midcap stocks in this bull market
Joanne Goh of DBS Bank highlights public capex's role in driving economic and earnings growth, favoring small and midcaps. India’s 7.8% GDP growth, stable global trends, rising domestic consumption, and strong emerging market inflows boost sentiment. Yet, elevated valuations, geopolitical uncertainties, and private consumption dynamics present fiscal policy challenges.
Phillip Capital initiates Buy call on Coal India amid rising capex and robust growth prospects, sees 23% upside
The scheme is benchmarked against Nifty India Defence - TRI, which provided a return of 146.17% in the last nine months. Over the past three and six months, the scheme delivered returns of 60.66% and 87.04%, respectively. In the last one year, the scheme has achieved a return of 187.42%.
Motilal Oswal raises target price for Hindalco, sees upside potential of 15%
Hindalco's target price raised to Rs 800 by Motilal Oswal as they plan a USD 6.9 billion capex for capacity expansion.
PSU rail, defence stocks rally up to 77% in 1 month. Will Budget be about Modi stocks?
Dalal Street anticipates Finance Minister Nirmala Sitharaman to maintain the capex agenda and fiscal discipline. PSU stocks in railways and defence sectors lead with up to 77% returns in a month. Pre-Budget optimism propels PSU stocks to record highs, despite concerns over stretched valuations. The rally is driven by 'Modi stocks,' linked to capex and infrastructure sectors.
FPIs lap up realty stocks amid low inventories, sustained demand scenario
The increase in the weight of the sector can be attributed to capital appreciation and steady inflow of overseas funds. The Nifty Realty index has outperformed the benchmark Nifty 50 by 32% year-to-date.
JM Financial initiates coverage on this small cap stock, views upside potential of 20%
Shivalik Bimetal Controls, analyzed by JM Financial, shows potential in niche markets with diverse growth avenues, including smart metering, EVs, and customized products. The company's expansion into shunt resistors and focus on global opportunities signal a promising future amidst challenges like market delays.
Indian Budget 2024: Jefferies sees affordable housing, capex-related businesses, consumer goods sectors getting the most benefit
Budget 2024 anticipates positive impacts on various sectors, with potential benefits for consumer goods and affordable housing. The budget may include tax cuts, interest subsidy reintroduction, and stable capital gains tax policies, fostering economic growth and fiscal prudence.
Morgan Stanley playing India's infra boom with these 4 stocks
Morgan Stanley expects a 15.3% CAGR in India's infrastructure investments, leading to $1.45 trillion spending over 5 years. They highlight the impact of PM Gati Shakti on project execution and efficiency improvements.
Balancing Act: With greater capex comes lower dividend
The dividend payout ratio is the proportion of a company's earnings paid to shareholders as dividends. This payout tends to be lower in times when companies spend more on expansion. Companies with a high cash flow in mature industries tend to have higher dividend payout ratios.
Consumer stocks have edge over capex-linked ones after shock poll verdict
Indian consumer-focussed companies are likely to shine, while capital spending-linked firms could suffer as the government shifts its policy focus to support lower-income segments, fund managers and analysts said on Wednesday, a day after a surprise result in the national elections.
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