TMS Ep378: Vedanta, airline pilots, road-infra players, index rebalancing

Gautam Adani may not be the only highly-leveraged Indian industrialist in trouble. While it is not facing a Hindenburg-like storm, Anil Agarwal’s Vedanta Resources Ltd too has significant debt on its books. And, one of Agarwal’s recent attempts to reduce the debt burden has met with opposition from the Indian government itself. So, is Vedanta in trouble? 

While metals-mogul Agarwal’s plan to trim down debt may have run into rough weather, airlines in India are clearly looking at a clear sky. After navigating pandemic turbulence, they have started reporting profits now. Orders of over 1,000 new aircraft have also been placed and the airlines are now scrambling to ramp up staffing. But will we be able to find enough pilots to fly the expanding fleet? What are the challenges involved? 

The number of operational airports in the country has risen from 74 to 140 in the last eight years. From sky traffic, let us now shift focus to the roads. Road and transport ministry saw a 36% jump in the Budget 2023 allocation, kindling hope that related-stocks would witness a good growth in the long-term. Experts said that the strong order book and healthy NHAI pipeline bodes well for road-construction players. 

Shares of Adani group companies recently tumbled after global index provider MSCI reduced the weightage of its four firms. But, it later postponed the decision to its May review -- giving some respite to the conglomerate. Key index providers like MSCI, FTSE, and Nifty undergo quarterly, or semi-annual rejig of their indices. This is called index rebalancing. We tell more about this in this episode of the podcast.