The BSE Sensex and NSE Nifty are likely to open in green on Thursday tracking SGX Nifty and firm Asian markets.(Photo: PTI)

The BSE Sensex and NSE Nifty are likely to open in green on Thursday tracking SGX Nifty and firm Asian markets.

At 8.23 am (IST), SGX Nifty was up 28 points, or 0.34 per cent, at 8,154.50.

Asian shares rose on Thursday and the dollar struggled near multi-week lows after weak US economic data added to expectations that the Federal Reserve will delay hiking interest rates. Hang Seng, Nikkei and Shanghai were up 1.18 per cent, 0.77 per cent and 0.71 per cent, respectively.

Back home, disappointing second quarter earnings from blue-chips so far and muted global cues dragged the benchmark BSE Sensex lower for a third consecutive session on Wednesday with a fall of 66.87 points to 26,779.66 following TCS Q2 numbers failed to impress investors.

Foreign portfolio investors bought shares worth a net Rs 121.75 crore on Wednesday, as per provisional data released by the stock exchanges. Domestic institutional investors sold shares worth a net Rs 207.63 crore, as per provisional data.

(With inputs from agencies)

Indian internet companies have raised $5.5 billion in the first nine months of 2015, a jump of over 37% over the $4 billion  mopped up in 2014, reports Neha Bothra in Mumbai, citing investment banking firm Jefferies. Industry estimates put private equity/venture capital investment at $11.8 billion in domestic companies in the first nine months of CY15,with around 50% deployed in the internet sector.

“If you look at the global economy, we are in an era of surplus money that is going into financial assets. Part of that is coming into India because the allocation to China is being readjusted, and investors had been off India for four-five years,” Akhil Awasthi, managing partner, Tata Capital Growth Fund, observed.

E-tailers like Paytm, Flipkart and Snapdeal have topped the list of fund-raisers, raising $1.2 billion, $700 million and $500 million, respectively, from investors including Alibaba, Tiger Global, DST Global, Falco Edge and Steadview Capital.

Gopal Jain, managing partner of Gaja Capital, says active global e-commerce investors, including hedge funds in the US and in the Chinese e-commerce space, are driving e-commerce valuations in India as well.

“It is a demand-supply situation, where a ton of money is chasing a few domestic e-commerce companies,” Jain said.
Sandeep Ladda, leader of technology practice at PricewaterhouseCoopers, said PE and VC interest around online hyperlocal and home services is building due to the exponential scope to scale up business in this area. “This rapidly growing convenience oriented segment is driven by India’s young population, and may outpace 56% CAGR in the next two to five years,” Ladda added.

Mukul Singhal, principal at SAIF Partners, said investors are bullish on companies that cater to local services and have a strong smartphone platform. “We are keen to invest in companies that provide a marketplace for commerce around the home and on-demand local services like interior designers, beauticians at home, wedding planners, for example,” Singhal told FE.

Shares of Tata Consultancy Services (TCS) plunged more than 4% on Wednesday as the company’s earnings for the second quarter of the current financial year fell short of Street expectations. The scrip closed at Rs 2,483 on the BSE, down by Rs 114 or 4.39%. A total of 45.3 lakh shares changed hands across the stock exchanges – more than three times the 90-day average of 12.23 lakh.

During the quarter under review, the net profit grew 6.1% to Rs 6,055.2 crore while revenues jumped 5.8% on year to Rs 27,165 crore. US-based investment banking firm Morgan Stanley said in a note to investors that mixed Q2FY16 results of TCS have been offset by the strong management commentary.

“According to management, the demand environment remains strong barring a few parts of the business. Latin America grew in 2Q, and is expected to continue to grow in constant currency terms over the coming quarters. TCS recorded strong order booking during the quarter. The order booking in 2Q16 was 30% higher than the highest ever order booking in any quarter historically. Moreover, order booking was broad-based across key verticals and geographies,” said Parag Gupta, vice-president of Morgan Stanley, in the note.

The report however observed that unlike Infosys, the revenue growth of TCS in North America decelerated to 3.1%, which could pose a downside risk to the stock along with decline in revenues from Diligenta, the UK-based insurance subsidiary of TCS.

The decline in TCS shares dragged other IT scrips with the CNX IT index closing down 1.39%. Shares of
Infosys closed 0.3% lower while shares of Wipro declined 0.5%.

Sun Pharma’s FY15 annual report analysis highlights 71% YoY increase in revenue to Rs 274 billion while EBITDA margins declined to 28.7%, led by Ranbaxy’s merger and Halol issues. Legal and consultancy charges increased to Rs 14.2 billion  (21.4% of PBT) v/s Rs 4.8 billion in FY14 while, additional provisioning of Rs 1.0 billion (1.5% of PBT) was recognized toward $ 400m deal.

Unrealised forex gains increased to Rs 7.8b (12% of PBT) v/s Rs 0.1b in FY14. Tax rate remained low at 14.2% on account of (a) SPLL structuring leading to tax savings of R3.2b, (b) recognition of DTA of Rs 7.3b and (c) no taxation in the Dubai entity.

Contingent liabilities for tax disputes increased to Rs 26.7 billion. Goodwill stood at Rs 50 b (20% of net worth); of which, Rs 13.6 billion pertains to acquisition (part of which represents brands /products in pipeline); which in our view should be amortised.

Revenue jumps 71% YoY to Rs 274 billion; EBITDA margins decline 1480bp to 28.7% due to (a) Ranbaxy’s merger related cost and relatively low-margin business and (b) Halol issues.

Operating cash flow increased 34% YoY to R53 billion in FY15.  Tax rates remained low at 14.2%; contingent liabilities for tax dispute rise to Rs 26.7 billion v/s R12.1 billion in FY14.

The initial public offering (IPO) of Coffee Day Enterprises was subscribed 0.13 times on the first day of its three-day offering.

Qualified institutional bidders (QIBs) bid for 12.19 lakh shares, against 73.80 lakh shares reserved for the category, data showed. The non-institutional category comprising high net worth individuals (HNIs) bid for 1.65 lakh shares, against reservation of 53.87 lakh shares. Retail investors subscribed 20.03 shares, against 1.25 crore shares reserved for the category.

The Bengaluru-based company had raised around Rs 334 crore on Tuesday through a pre-IPO placement to anchor investors. A little over one crore shares were allotted to 17 institutional investors at a price of  Rs 322 apiece. List of anchor investors included Blackrock, Government Pension Fund Global, ICICI Prudential Mutual Fund, Merrill Lynch, Swiss Finance Corp and Axis Mutual Fund.

Coffee Day Enterprises plans to raise Rs 1,150 crore through the issue, making it the largest IPO in nearly three years. The company has fixed a price band of Rs 316-328 per share. Kotak Investment Banking, Citigroup, Morgan Stanley, Axis Capital, Edelweiss and Yes Bank are the lead book running managers for the issue.

Coffee Day Enterprises is the parent company of Coffee Day Group and the company operates the largest chain of coffee stores in India.

The company also has presence in real estate sector through a subsidiary, Sical Logistics. It also owns a 16.75% equity holding in information technology company, Mindtree.