Telecom stocks will be in focus as in a move that would enable big ticket mergers in the telecom sector, the empowered group of ministers (EGoM) on telecom reportedly on Tuesday allowed an entity formed by merger between two or more mobile service providers to hold up to 50% of the market share in a circle.
After any merger and acquisition, they can hold two carriers of spectrum in the 3G band. Currently, operators have only one carrier of 5 Mhz 3G spectrum and are required to surrender any additional carrier they get from a merger. But in the 2G space the acquiring company will have to pay the difference between the entry fee and the auction-determined price of spectrum beyond 4.4 MHz in the GSM band and 2.5 MHz in the CDMA band, if the spectrum was originally acquired by paying the entry fee.
No separate charges will be required to be paid for spectrum acquired through auctions. This will leave 3G spectrum out of the ambit of any extra payment to the government as this spectrum was acquired through auctions.
An area which is still to be decided is whether the lock-in of three years on a new licensee from selling out should be lifted or not. The government is likely to seek a legal opinion on this. The Supreme Court had mandated that all spectrum freed up by cancellation of 122 licences post its February ruling needs to be put up for auction. The EGoM had asked the Department of Telecommunications to clarify the total quantum of spectrum available in the 1,800 Mhz band that can be sold, report said.
Meanwhile, Reliance Communications has reportedly upped 3G mobile internet rates by 26% and reduced the benefit on the internet packages. The company increased the price of 1 GB of 3G internet usage to Rs 156 from Rs 123 it charged earlier.
HDFC, the country's largest home financier, has reportedly hiked its home loan rates by 10 basis points (bps) with effect from 1 December 2013. Following the hike, the lender's retail prime lending rate now stands at 16.75%. The interest rate on home loans of up to Rs 30 lakh will now be 10.5% while from Rs 30 lakh to less than Rs 75 lakh, the rate will be 10.75%.
Meanwhile, HDFC has also reportedly received Reserve Bank of India's permission to raise $300 million through external borrowings under a new facility aimed at funding affordable housing projects.
Syndicate Bank's board of directors at its meeting held 3 December 2013, has considered and approved the issue of equity shares aggregating to Rs 200 crore on preferential basis to Government of India. The announcement was made after market hours on Tuesday, 3 December 2013.
Bank of Baroda's board of directors at its meeting held on 3 December 2013, considered and approved issue of such number of equity shares aggregating upto Rs 550 crore, on preferential basis to Government of India. The announcement was made after market hours on Tuesday, 3 December 2013.
Jyothy Laboratories said that the preferential allotment committee of the board of directors of the company at its meeting held on 3 December 2013, has allotted 1.50 crore equity shares of the company to Sahyadri Agencies on preferential basis at Rs 175.15 per share against receipt of entire amount payable by Sahyadri Agencies in cash aggregating to Rs 262.72 crore. Consequent to the aforesaid allotment, the paid-up capital of the company has increased from Rs 16.60 crore to Rs 18.10 crore. The announcement was made after market hours on Tuesday, 3 December 2013.
Mahindra Holidays & Resorts India said that the BAH Hotelanlagen AG, Austria and MHR Hotel Management GmbH, Austria have ceased to be subsidiaries of the company with effect from 29 November 2013 in view of divestment of investment held by the Company in the aforementioned subsidiary companies. Further, the company has informed that the existing arrangement for room inventory will continue between BAH Hotelanlagen AG (which has a hotel property "Bon Alpina" in Innsbruck, Austria) and the company. Accordingly, Club Mahindra members can continue to avail the room inventory in Bon Alpina. The announcement was made after market hours on Tuesday, 3 December 2013.
Sugar stocks may be in focus after global sugar prices fell to a three-year low in London on speculation that exports from India will speed up after the end of a cane-price dispute that delayed processing in the world's second-biggest producer.
Infrastructure stocks may be in focus after the Reserve Bank of India (RBI) on Tuesday eased norms for companies raising foreign funds for infrastructure projects. Companies can now raise funds through the external commercial borrowing (ECB) route for their infrastructure projects through their holding firms or core investment firms, which will enable them to arrange finances for these projects faster.
Such funds should be used in special purpose vehicles (SPVs) for a specific project, RBI said in a notification. Presently, SPVs are allowed to bring in ECB funds for infrastructure projects, while there were restrictions for parent firms in doing so. The new norms, applicable with immediate effect, will make availing ECB funding easier for infrastructure firms.
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