IREDA in Spotlight: Government Approves New Fundraising Route:-
Discuss some important companies and some important updates related to them The name of the first company is ET i.e. Indian Renewable Energy Development Agency. Disclaimer that all the company related news and updates that we will cover are only for educational purposes. So do not consider this as any kind of investment advice. You can also do your own research and analysis.
Government Approves Capital Gains Bonds:-
There are two big reasons to stay focused. Now what are those two reasons? So let us understand both the reasons one by one.The first reason is that they have got approval from the government. Now we will hear the name of IREDA. So, one thing has been common with IREDA in the past some time and that is fund race. So at present the government has given approval to IREDA regarding the fund race. Approval for what brother? of Fund Race. With whom? Through capital gains bonds. Now you will see IREDA sending you funds through Capital Gain Bonds. That means, we can say that a new source of fund race has been found by IREDA. Raise Fund through 54 EC Bonds which you can also call Capital Gain Bonds. Now it is not the case that only IREDA will be seen raising funds through Capital Gain Bonds. Apart from this, there are some other companies which raise money through this mode. In which you see one name of RSC. PFC can be seen. The name of NHAI is visible. You also get to see the names of companies like HUDCO and ifc.
Now the biggest reason for this is that if we till FY 30, the aim of this company is to increase its loan book by almost five times. Now to achieve such a big M, the company needs a huge amount of money so that the company can sanction more and more loans and the more the loan sessions, the more the company can contribute to the renewable sector and also achieve growth and for this, for the last few times, we have been continuously hearing news of new fund or fund raising related to IREDA. So friends, this was the first news due to which Irida was seen in focus to you.
Q1 Results Expected Today:-
The second news is that today IREDA is going to report its quarterly results. which result brother? Q1 result means the result of quarter one. Now look, on the basis of the recent quarter one business update shown by the company, the market had cheered after seeing IREDA. Now if the market has reacted on the basis of the business update of Q1, then we can certainly expect that we may see good numbers in the company’s results. In which we can also expect good from the company’s revenue. You can expect good profits as well. Apart from this, we can expect better from other parameters like NPS etc. If we look at it, the company’s results for quarter one may be good. It has its possibilities. But apart from this there are some other things which are more important than the result. Now look, you will not see the details of expectations of much results in the market but one thing will definitely be seen that the focus of the investors will be on the growth outlook of the company because what will be the commentary of the company on the asset quality because recently we saw the news of default of Gensol Engineering and IREDA’s money was also stuck in Gensol Engineering, so on the basis of all these things, we will get to hear the details of asset quality from IREDA, that too will be an important parameter along with the results of this company. So the result is important but along with it the commentary of the company is important and apart from that the growth outlook of the company is also very important.
DMart: Mixed Sentiments Ahead of Q1 Results:-
The next company whose name is Aveen Summar. According to Irate, we got to see very good business update of quarter one and the market also cheered it. But when we look at the business update of quarter one of New Supermarket i.e. DMAR, the market did not like it. So tomorrow we will get to see the quarterly results of this company as well and the market expectation regarding the results that we will see is that if we talk about its top line i.e. revenue, then we may see muted outcomes there. This means that muted growth can be seen. But what are the expectations at the moment ? So the expectations here are that the company’s revenue can grow by 17.8%. Revenue of Rs 16,583 crore may be seen. We may see growth of around 17 or 18% compared to last year.
Now if we compare it with the previous quarter, growth is expected on q and q basis but growth is expected on year on year basis as well. You should keep this thing in mind. This is the expectation of the brokerage house. Now apart from this, about EBITDA, the performance of EBITDA may remain weak in comparison to revenue. We will see growth in EBITDA of only 11%. EBITDA of Rs 1,354 crore may be seen which was Rs 12,21 crore last year, sorry. And if we compare this with the previous quarter, on a basis, we may witness very good growth in EBITDA. And even if we look at it on year on year basis, we will see growth of around 11%. That is, we can say that the financing, sorry not financing, but operating profit margin of the company may be seen performing slightly better to us. If we look at it on a Q on Q basis, but there is still a big question mark on how it will perform on a year on year basis. About net profit which can grow by 14% this time .About last year, the company had reported a profit of Rs 774 crore. So this time the profit is also expected to be in double digits, but these double digit numbers are not something that we will see only in quarter one. These were also seen in the previous quarter. These were seen in the previous quarter as well and even before that. But what is happening is that the company is reporting double digit growth. But as per the market expectation, suppose the market is expecting a growth of 15%, then the company’s number comes at 14%. That means it is not able to meet the exact expectations. So because of this, valuation concern is always seen in this company. If we look at the data from 2021 till now, at one time the company was seen at a PE of 300, but if you look at the present time, you get to see this company at a PE of about 100. Because the growth of the company has continuously created a big question mark that it has not been consistent due to multiple things in which you can say that margin is also a big issue.
HAL & Defence Stocks: Why the Sudden Pressure?:-
About the next company whose name is Hindustan Aeronuticsed i.e. HL,About Hindstan Aeronautic, today whether we talk about Hindstan Aeroneric or other defence companies like Bharat Dynamics GRE or other defence stocks, you were seeing some pressure in all of these today.
Now let us understand what could basically be the possible reason behind this. So, look friends, if you look at the past few times, our defence company has delivered good performance. Now its reason is geopolitical tension. Whether we talk about India-Pakistan, Israel-Hamas or Israel-Iran, we saw many things related to geopolitical tension. So because of this the hope had increased that our defence exports can grow rapidly and we also saw good performance. But in the meanwhile we did not hear anything related to the numbers that we might get such a big contract from Israel or we might get such a big contract from Iran. Meaning, we can say that in the future, the company may be seen getting more export orders.
Cooling Geopolitical Tensions:-
But the current scenario is that all the war like situations that were there, may not be official but yes the things are such that they are going to end in the future and you may see all these things very soon. We just got to see a statement from Trump, sorry Trump, that the conflict between Israel and Hamas could end within a week as both can be seen agreeing for a ceasefire. This means that their cease fire deal can possibly be seen by you this week or you can say that you can see it in the next week i.e. in 7 days. So all these things are coming from Trump. That means if this war ends then as per the present time only Ukraine and Russia war will remain. All the remaining wars have been officially completed. So keep all these things in mind. And on the basis of all these things, today our defense company seems to be performing a little weak. But it is not that if all these things do not happen then our defense company will not get contracts.
India’s Defence Budget Still Has Room to Grow:-
If you look at the data on which country spends how much on its defence, then at number one you will see the United States i.e. America which spends approximately 997 billion on its defence. 3.4% of GDP Then you see China. Then we get to see Russia. Then we get to see Germany. Then we see India which spends 2.3% of its GDP on defense; we get to see an investment, sorry allocation, of around 86 billion in the defense sector. Now, the thing to note is that out of these four countries, we are lagging behind, if we look at just one country, Germany, and the rest of the countries, we are far behind them. That is, it is not the case that now that the war is over, our defence spending will continue as it was going on; it may become weak in the future, it is not like that. Right now, we can say that India needs to make huge spending and gains. If you want to see yourself dominating at the global level, then you should pay attention to all these things that the war like situation is definitely over but ultimately if seen in the long run, India will also increase its defense spending, due to which if seen in the long run, defense companies will keep on getting contracts etc. continuously.
Pavan Industries: Announces First Ever Stock Split:-
The next company whose name is Pavan Industries. Recently the company has announced the first ever split in which the company has approved the split in the ratio of 1:10. So if you are an investor in this company then definitely this news is for you.