Share markets in India continued their upward climb today as risk appetite improved on a proposed stimulus plan by the European Union.
European Union leaders appeared close to agreement on a massive stimulus plan for their economies, with EU Council President Charles Michel voicing confidence of reaching a deal on the 750 billion euro recovery fund.
Strong cues from global peers and upbeat Q1 earnings also boosted the sentiment.
In overnight trade, surging technology shares pushed the Nasdaq to a record closing high, as promising trial results from potential Covid-19 vaccines boosted investor sentiment.
The BSE Sensex is trading up by 445 points, up 1.2%, at 37,850 levels. Meanwhile, the NSE Nifty is trading up by 121 points.
The BSE Mid Cap index is trading up by 0.4%. The BSE Small Cap index is trading up by 0.5%.
On the sectoral front, gains are largely seen in the energy sector and realty sector.
The rupee is trading at 74.78 against the US$.
Gold prices are trading up by 0.2% at Rs 49,105 per 10 grams.
Moving on, Vodafone Idea is among the top buzzing stocks today.
Shares of the company fell as much as 9% today, a day after the Supreme Court indicated it may consider a longer time frame for repayment of adjusted gross revenue (AGR) dues, which though could be lesser than 20 years that the government has backed.
The three-judge bench, led by Justice Arun Mishra upheld the amount to be paid by Bharti Airtel at Rs 259.8 billion and by Vodafone Idea at Rs 504 billion, factoring in payments of Rs 180 billion and Rs 78.4 billion, respectively.
Additionally, Vodafone Idea also missed the July 15 deadline to pay over Rs 12 billion to the Department of Telecommunications as license fee and spectrum usage charges for April-June.
In news from the IT sector, shares of Majesco are locked in the 5% upper limit today after the company's board agreed to sell its US subsidiary to private equity firm Thoma Bravo.
The Nasdaq-listed arm of the IT company will be sold at US$ 13.1 apiece, a premium of around 74% to its closing price on July 17, according to the corporate announcement on exchanges.
The deal values the company at US$ 594 million.
The board of directors at its meeting on July 20 approved the sale of the company's entire stake/ investment in the US subsidiary pursuant to the merger, subject to the approval of the shareholders of the company and other regulatory and statutory approvals, as may be required.
Majesco will divest its entire 74% stake in the US arm and will get US$ 421 million in cash by the sale of the US arm.
Reportedly, the company plans to distribute the entire amount to shareholders via a combination of buyback and dividends.
Moving on to news from the banking sector, HDFC Bank fired at least six senior and mid-level officials after an internal investigation found that they breached the code of conduct and governance standards by indulging in corrupt practices.
It was reported that car loan customers of the private sector lender were forced to purchase GPS devices by bundling them with loans in a possible violation of guidelines prohibiting banks from non-financial businesses.
Plus, the internal scrutiny revealed that some customers were not even aware of buying a vehicle tracking device.
The products were allegedly bundled with auto loans to meet sales targets and potentially track borrowers in the event of loan default.
Several news reports mentioned that executives of HDFC Bank had forced car loan customers to buy GPS devices costing Rs 18,000-19,500 from 2015 to December 2019.
Meanwhile, the country's largest private sector lender has received shareholders' approval to raise up to Rs 500 billion through bonds to enhance capital base to fund its business growth.
Last month, the board cleared the capital proposal to be carried out over the next twelve months.
HDFC Bank last week posted a 19.6% year-on-year rise in net profit at Rs 66.6 billion for the quarter ended June 30. The figure stood at Rs 55.7 billion in the corresponding quarter last year.
Net interest income of the lender grew 17.8% YoY to Rs 156.7 billion in Q1FY21, driven by growth in advances of 20.9%, and growth in deposits of 24.6%.
HDFC Bank share price is presently trading up by 0.6%.
Note that, HDFC Bank is one that has always adapted to changing times.
HDFC Bank wanted to transform itself from a leader in physical banking to a leader in online banking. Since then, HDFC Bank has constantly focused on going digital.
In 2004, only 10% of customer transactions were initiated through the internet and mobile. The number has gone up to 92% in 2019.
It is a great example of a company that has taken advantage of its scale and embraced disruption rather than fear it.
These are traits that one should look for in picking stocks. They not only withstand the disruption but also gain from it in the long-run.
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