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<p>Fitch Ratings announced on Monday that it has upgraded the long-term foreign and local currency issuer default ratings of Oravel Stays, the parent company of OYO, from 'B-' to 'B', with a 'Stable' outlook. This upgrade reflects the hospitality firm's strengthened financial standing.</p> <p>Additionally, Fitch has raised the rating on Oravel Stays' USD 660 million senior secured term loan due in 2026 from 'B-' to 'B'. The decision is based on expectations that OYO's EBITDA leverage will fall below 5x, supported by continuous EBITDA growth, cost reductions, a rebound in short-term stay demand, and a recent USD 195 million debt buyback in November 2023.</p> <p>The upgrade follows OYO's recent financial success, with the company posting a net profit of approximately INR 99.6 crore (USD 12 million) for the fiscal year 2023-24, as shared by Founder Ritesh Agarwal during a recent town hall meeting.</p> <p>Fitch highlighted OYO's strong liquidity position, noting the company's adequate cash reserves and the anticipation of positive free cash flow starting from the financial year ending March 2025 (FY25). As of March 2024, OYO had about USD 95 million in unrestricted cash, surpassing Fitch's post-debt buyback projection of USD 80-90 million.</p> <p>Fitch believes that OYO's enhanced profitability and decreasing leverage will facilitate timely refinancing of its debt. The rating agency also forecasts continued improvement in the travel and tourism sectors within OYO's main markets for FY25.</p> <p>Overall, Fitch's upgrade of Oravel Stays' ratings underscores the company's improved financial health and positive outlook for the future.</p>
<p>Starting June 10, the National Stock Exchange (NSE) will implement a one paisa tick size for all stocks trading below Rs 250 per share, as announced in a circular issued on May 24. This change aims to enhance price discovery and reflects the ongoing competitive dynamics between NSE and BSE for market leadership, as noted by market analysts.</p> <p>A tick size represents the minimum price variation between consecutive bid and offer quotes. Additionally, beginning July 8, stock futures will adopt the same tick size as the cash market segment. This adjustment will apply to all futures contracts, including Near-Month, Middle-Month, and Far-Month expiries, according to the NSE circular.</p> <p><br />The introduction of a one paisa tick size for stocks priced below Rs 250 is a strategic move by the NSE to improve the precision of price discovery. By allowing for smaller price increments, the exchange aims to facilitate more accurate and granular adjustments in stock prices, which can benefit both traders and investors. This finer tick size can lead to tighter bid-ask spreads, potentially reducing trading costs and increasing market liquidity.</p> <p>This measure is also indicative of the intense rivalry between the NSE and BSE. Both exchanges are continuously seeking ways to attract more trading volume and market participants. By implementing a more competitive tick size, the NSE could draw traders who are looking for better price efficiency, thereby potentially increasing its market share.</p> <p>Market participants are likely to view this change positively. Tighter spreads can lead to lower transaction costs, making trading more attractive. However, there could be some initial adjustments required for trading algorithms and systems to adapt to the new tick size.</p> <p><br />Overall, the introduction of a one paisa tick size for lower-priced stocks and futures represents a significant step by the NSE to enhance market efficiency, attract more participants, and stay ahead in the competitive landscape of Indian stock exchanges.</p>
<p>The Reserve Bank of India (RBI) has levied a penalty of Rs 3.1 lakh on Hero FinCorp Limited due to regulatory non-compliance in specific areas concerning fair practices code. This penalty, however, reflects deficiencies in adhering to regulatory standards and does not question the validity of the company's transactions or agreements with its clientele.</p> <p>The imposition of the penalty follows a statutory inspection conducted by the RBI, referencing the company's financial status as of March 31, 2023. Subsequent to supervisory observations indicating deviations from RBI directives and related correspondence on the matter, the company was issued a notice to justify why penalties should not be imposed for its failure to adhere to regulatory directives.</p> <p>After assessing the company's response to the notice, oral arguments presented during the personal hearing, and reviewing additional submissions, the RBI concluded that the charge against Hero FinCorp was substantiated, necessitating the imposition of a monetary penalty.</p> <p>One of the identified shortcomings was the company's failure to provide borrowers with loan terms and conditions in a language comprehensible to them. The RBI clarified that the penalty imposed does not preclude any further action that may be taken against the company.</p> <p>The regulatory action underscores the RBI's commitment to upholding compliance standards within the financial sector, ensuring fair practices and transparency in dealings with customers.</p>
<p>Waaree Energies Limited has secured a contract to supply 445 MW of its 540/545Wp dual glass bifacial solar modules for a major solar project in Bikaner, Rajasthan. Deliveries of these modules are scheduled from May to August 2024.</p> <p>The initiative aims to harness solar power to foster economic development and create jobs in the region. By using advanced bifacial technology, these modules can capture sunlight on both sides, enhancing efficiency and energy yield, which is particularly advantageous in Rajasthan's high-sunlight conditions.</p> <p>Hitesh Doshi, Chairman & Managing Director of Waaree Energies Limited, stated, "Our collaboration with Statkraft India is a crucial step towards advancing India's renewable energy agenda." He also highlighted that this project is not just about energy production but also about integrating sustainable practices into the local economy, supporting long-term environmental goals.</p> <p>The deployment of Waaree's bifacial modules is anticipated to significantly boost the area's renewable energy output, cut down carbon emissions, and support environmental sustainability. This project aligns with India's commitment to achieving 450 GW of renewable energy capacity by 2030, as part of its National Solar Mission.</p> <p>Furthermore, the Bikaner project is expected to generate substantial local employment, from the installation phase through to ongoing maintenance, providing a much-needed economic boost to the region. The project also serves as a model for future large-scale solar developments in India, showcasing the viability and benefits of cutting-edge solar technologies.</p> <p>Overall, this partnership between Waaree Energies and Statkraft India exemplifies a strategic move towards sustainable growth, energy security, and a cleaner, greener future for India.</p>
<p>Sterlite Power Transmission Ltd (SPTL) announced on Thursday that its shareholders have approved the plan to demerge its transmission business. This restructuring will result in the transmission infrastructure being placed under a new entity, Sterlite Grid 5 Ltd, while SPTL will continue to manage the global products and specialized EPC services.</p> <p>The demerger proposal received overwhelming support across the board, with secured creditors unanimously in favor, 99.26% of unsecured creditors approving, and nearly all equity shareholders (99.99%) voting in favor. Non-fund-based lenders also gave their unanimous support.</p> <p>This strategic move is designed to streamline the company's structure, enabling each entity to attract investors that align with their specific financial needs. The transmission business, now under Sterlite Grid 5 Ltd, can appeal to long-term investors looking for stable cash flows. Meanwhile, SPTL, focusing on its Global Products & Services (GPS) division, can attract investors seeking higher returns, often those interested in pre-IPO or capital market opportunities.</p> <p>Pratik Agarwal, Managing Director of SPTL, highlighted the significance of the stakeholders' support, stating that it underscores the strategic rationale behind the demerger. He emphasized that this milestone is crucial for developing two distinct business units, each poised for independent growth.</p> <p>Sterlite Power is a prominent private sector developer in power transmission infrastructure and a provider of GPS services.</p>
<p>Le Travenues Technology, the parent company behind the well-known travel platform ixigo, has received the green light from the Securities and Exchange Board of India (SEBI) to move forward with its initial public offering (IPO). This approval was disclosed by SEBI on Wednesday.</p> <p>Based in Gurugram, Le Travenues Technology first filed its IPO prospectus in February. The filing detailed plans to issue new shares valued at ₹120 crore and included an offer for sale (OFS) of 66.67 million shares by current investors. Among those selling shares are Elevation Capital (formerly Saif Partners), Peak XV Partners, and company founders Aloke Bajpai and Rajnish Kumar, as indicated in the draft red herring prospectus (DRHP).</p> <p>In February, ixigo resubmitted its DRHP to SEBI, reiterating its goal of raising ₹120 crore through new share issues and selling up to 66,677,674 equity shares.</p> <p>The funds generated from this IPO will be invested in technological enhancements, such as data science, cloud infrastructure, server hosting, artificial intelligence, and customer engagement improvements.</p> <p>Additionally, the proceeds from the issuance of new shares will be used to bolster working capital, finance potential acquisitions, advance technological projects, support strategic initiatives, and cover general corporate expenses.</p>
<p>In a recent townhall, OYO's Founder Ritesh Agarwal revealed that private investors have shown interest in the travel tech company, potentially raising equity at a valuation ranging between $3 billion to $4 billion. This development comes as OYO, supported by Softbank, reported its first net profitable year with a profit after tax (PAT) of Rs 99.6 crore ($12 million) for the fiscal year 2023-24.</p> <p>The company recorded an adjusted EBITDA of Rs 888 crore ($107 million) for the same period, a significant increase from Rs 274 crore ($33 million) in FY23, according to sources who attended the townhall and reviewed the presentation.</p> <p>OYO, operated by Oravel Stays Ltd, plans to refile its initial public offering (IPO) documents with the Securities and Exchange Board of India (Sebi) following the refinancing of its $450 million Term Loan B (TLB) at a lower interest rate, as reported by PTI last week.</p> <p>During the townhall, Agarwal mentioned that OYO might consider a small equity round at Rs 38-45 per share to further reduce its debt. The fiscal year 2023-24 saw OYO adding approximately 5,000 hotels and 6,000 homes globally.</p> <p>The company’s gross booking value (GBV) per storefront per month for hotels was around Rs 3.32 lakh ($4,000). OYO's gross margins for FY24 increased to Rs 2,508 crore ($302 million) from Rs 2,350 crore ($283 million) in the previous year.</p> <p>Operational costs also saw improvement, dropping from 19 percent of GBV in FY23 to 14 percent in FY24. Agarwal attributed the profitability to enhanced operational performance, stable gross margins, cost efficiencies, and reduced interest costs after a partial prepayment of $195 million in debt during Q3 FY24.</p> <p>Looking ahead, Agarwal expressed confidence in growing both revenues and GBV for FY25 while maintaining the profit growth trajectory.</p>
<p>Hexaware Technologies, a leader in digital solutions, announced its acquisition of Softcrylic, a Minneapolis-based data consulting firm. This strategic move is intended to enhance Hexaware's data and analytics offerings, allowing the company to deliver a comprehensive suite of services aimed at improving marketing and customer journey initiatives through advanced data and technology integration. The financial terms of the acquisition were not disclosed.</p> <p>Hexaware stated that combining Softcrylic’s marketing technology and customer journey expertise with Hexaware’s strengths in engineering and artificial intelligence will significantly bolster the capabilities of chief marketing officers (CMOs) in driving business growth through efficient data utilization. The partnership is expected to extend the use of data beyond marketing to various business functions, enabling enterprises to customize their data journeys comprehensively.</p> <p>Girish Pai, Hexaware's Global Head of Data and AI, emphasized that the acquisition aligns with Hexaware's vision to become a premier partner for customer and marketing analytics solutions. He noted that Softcrylic’s profound data expertise and marketing analytics proficiency would empower Hexaware to help clients unlock the full potential of their data, leading to tangible business outcomes.</p> <p>Softcrylic specializes in resolving complex data issues, from data capture and validation to modeling and activation. Their services enable organizations to derive deeper insights and activate data effectively.</p> <p>John Flavin, CEO of Softcrylic, expressed enthusiasm about the acquisition, highlighting the potential for expanded reach and accelerated growth. He is confident that the merger will create a formidable entity in the data consulting industry.</p> <p>With its headquarters in Minneapolis and additional offices in Atlanta, Princeton, Chennai, and Canada, Softcrylic serves a global clientele across various sectors including travel and hospitality, food and beverage, retail, financial services, and sports and media.</p>
<p>Oravel Stays Ltd, the operator of the travel-tech company Oyo, is set to refile its initial public offering (IPO) documents with the Securities and Exchange Board of India (SEBI) following the refinancing of its $450 million Term Loan B (TLB) at a lower interest rate.</p> <p>Oyo is nearing the completion of its refinancing strategy, which involves raising $350-450 million (approximately Rs 2,908.5 crore to Rs 3,739.5 crore) through bond issuance, with an estimated interest rate of 9-10 percent per annum, as per sources reported by IANS on Saturday.</p> <p>This move aims to substantially reduce the current effective interest rate of 14 percent on the existing $450 million TLB, which has a seven-year repayment term. The anticipated refinancing is expected to deliver annual interest savings of $8-10 million (Rs 66.4-83.0 crore) in the first year, even after accounting for the bond issuance costs. According to sources, these savings could increase to $15-17 million (Rs 124.5 crore to Rs 141.1 crore) annually thereafter, which would significantly boost the company's net profits. The refinancing will lead to significant changes in Oyo's financial statements.</p> <p>Under current SEBI regulations, the company must update its filings with the regulator. JPMorgan is leading this refinancing initiative. Oyo has decided to delay pursuing IPO approval with its current financials due to the advanced stage of the refinancing decision.</p>
<p>In the first quarter of 2024, Nayara Energy, a private fuel retailer, experienced a substantial 48% increase in petrol sales, reflecting a strategic shift towards fulfilling the rising domestic demand. During this period, the company reduced its fuel exports to accommodate the growing needs within India.</p> <p>Nayara’s Vadinar refinery in Gujarat saw 70% of its petroleum products being sold locally from January to March 2024, according to a company statement. The focus remains on serving India’s energy requirements through direct sales, partnerships with other oil companies, and its retail outlets.</p> <p>In detail, local petrol sales soared to 0.89 million tonnes in the first quarter of 2024, up from 0.60 million tonnes in the same period the previous year. Diesel sales remained steady at approximately 1.7 million tonnes.</p> <p>Emphasizing its role in supporting India’s energy consumption, Nayara Energy remarked, “We are committed to meeting India’s energy demands and will continue to be a reliable partner in this regard.”</p> <p>The company noted that the first quarter is pivotal due to increased economic activity linked to the harvest season. Despite India's limited crude oil production, which is crucial for making fuels like petrol and diesel, the country possesses a surplus refining capacity. Data from the Oil Ministry indicated that while domestic consumption was 233.3 million tonnes, production reached 276.1 million tonnes in the 2023-24 period.</p> <p>A notable shift was observed in Nayara’s gasoline export strategy. The percentage of gasoline exported dropped significantly from 37% in the first quarter of 2023 to 11% in the same period in 2024, underscoring the company’s commitment to prioritizing local demand.</p> <p>Nayara’s export destinations remain focused on Africa, Southeast Asia, and the Middle East, with no automotive fuels being exported to Europe. Out of the total 1.53 million tonnes exported, gasoil accounted for about 0.95 million tonnes. The company highlighted that over the past five years, exports to the European Union have been minimal.</p> <p>The domestic market for petrol and diesel in India grew by 5.3% from January to March 2024, with total consumption reaching 32.3 million tonnes compared to 30.7 million tonnes in the same period the previous year. This increase was driven by an 8.4% rise in petrol consumption and a 4.1% rise in diesel consumption.</p> <p>“Nayara Energy remains dedicated to supplying the energy that powers the aspirations of our customers, partners, communities, and employees,” the statement continued.</p> <p>Nayara Energy contributes significantly to India’s oil refining sector, producing around 8% of the country’s output with its 20 million tonnes per year Vadinar refinery.</p> <p>Alessandro des Dorides, CEO of Nayara Energy, affirmed the company’s ongoing commitment to supporting India’s growing energy needs by maintaining a strong presence in the domestic market.</p>
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