Indian share markets ended their trading session deep in the red today.
Indian stock markets witnessed selling on the back of weak global cues and the Supreme Court's verdict on the adjusted gross revenue (AGR) case. The Supreme Court expressed grave concerns over the government's move to slap spectrum dues worth over Rs 4 lakh crore from PSUs as AGR-based dues on par with private sector telco's dues.
Sectoral indices ended on a negative note with stocks in the telecom sector and banking sector witnessing most of the selling pressure.
At the closing bell, the BSE Sensex stood lower by 708 points, down 2.1%.
Meanwhile, the NSE Nifty closed down by 214 points, down 2.1%.
SGX Nifty was trading at 9,885, down by 226 points or 2.24% lower, at the time of writing.
The BSE Mid Cap index ended the day down by 1.4%, while the BSE Small Cap index ended down by 1%.
Asian stock markets ended on a negative note today. As of the most recent closing prices, the Hang Seng ended down by 2.27% while the Shanghai Composite stood lower by 0.78%. The Nikkei ended down by 2.82%.
European stock markets also declined today, moving away from their three-month peak following a downbeat economic outlook from the US Federal Reserve and on worries of a second wave of COVID-19 cases.
The central bank expects the US economy to shrink 6.5% in 2020 and the unemployment rate to be 9.3% at the year's end.
The rupee is trading at 75.74 against the US$.
Market participants were tracking penny stocks in today's market trade.
This comes as penny stocks have delivered eye-popping gains in the recent market rebound from the lows of March 24, when Sensex and Nifty had scaled their fresh 52-week lows.
Shares of Vodafone Idea have rallied as much as 200% from Rs 3.36 on March 24 to Rs 10.08 earlier this week on June 9.
Speaking of the current stock market scenario, note that the coronavirus impact has shaken markets worldwide.
For the BSE Sensex, FY20 was the second-worst year post FY08, the year of the global financial crisis.
Good Time to Start Investing Now?
Moving on, market participants were tracking Ramco Systems' share price. Shares of the company were locked in the upper circuit limit of 20% for the second day today after investor Vijay Kedia acquired a stake in the company via open market on Wednesday.
In news from the telecom sector, the Supreme Court today directed telecom companies to provide details with respect to three key points - the roadmap for payments in terms of the period required to repay AGR dues; timeline of payment, and security they can provide to guarantee payment.
The Supreme Court expressed grave concerns over the government's move to slap spectrum dues worth over Rs 4 lakh crore from PSUs as adjusted gross revenue (AGR)-based dues on par with private sector telco's dues.
Justice Mishra dubbed the government moves to slap similar dues for recovery from PSUs as a misuse of its earlier ruling against the private telcos.
He warned of action against the Department of Telecommunications (DoT) officials responsible for the move while seeking clarity on this move from the Solicitor General who appeared for the government.
Here are the key highlights from the AGR Case:
Justice Arun Mishra said, nobody has seen the next 20 years, can't allow extension based on a "gentleman's promise". How can 20 years be said to be reasonable? he asked referring to the government demand that staggered payment is allowed over a period of 20 years.
On Justice Mishra's doubts about the guarantee that telecom companies will make the payment, Vodafone Idea counsel Abhishek Manu Singhvi and Bharti Airtel counsel Mukul Rohatgi said the court can go ahead and cancel their licenses if the companies do not pay up within the stipulated period.
Questions were raised on how the department made demands from oil PSUs when the judgment never dealt with PSUs. Demands to the tune of Rs 4 lakh crore are being raised with ulterior motives, Justice Mishra said, ordering that the demand against PSUs be withdrawn.
The next hearing in the telecom AGR dues case is scheduled for June 18.
Note that this hearing comes after the one held on March 18, where the apex court pulled up the DoT for allowing telcos to self-assess payable dues.
How this all pans out remains to be seen. Stay tuned for more updates from this space.
Moving on, IndusInd Bank share price was in focus today. The stock continued its rally seen this weel and witnessed huge buying interest today as the bank's promoters have said they would acquire additional shares of the bank from the secondary market.
The bank in a filing recently announced that the promoters will purchase additional shares from the open market within the overall regulatory limit prescribed for promoter equity holding cap.
The promoters, IndusInd International Holdings Ltd. and IndusInd Ltd., currently hold 14.68% of the paid-up share capital of the bank.
In April, the bank had said that the promoters have applied to the Reserve Bank of India for increasing their permissible holdings to 26%. On a fully diluted basis, the promoters have a holding of 14.68% which is very close to the current regulatory cap of 15%.
We will keep you updated on all the developments from this space.
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