Companies & Sectors
Tech Mahindra buys Hutch's BPO arm for $87.1 million

“The acquisition will provide significant enhancement of Tech Mahindra’s expertise in the customer management space and will be a key component of strategic plans going forward,” Tech Mahindra said in a statement


Software services major Tech Mahindra today announced the acquisition of Hutchison Global Services (HGS) for an upfront payment of $87.1 million (about Rs480 crore), reports PTI.
“Tech Mahindra announces the acquisition of 100% stake in Hutchison Global Services for $87.1 million, payable upfront,” Tech Mahindra said in a statement.

The acquisition will provide significant enhancement of Tech Mahindra’s expertise in the customer management space and will be a key component of strategic plans going forward, it added.
The deal will also enable Tech Mahindra to leverage the acquired capabilities and scale for expanding the scope of their existing services to other parts of the Hutchison group and to other customers and verticals, the statement said.
HGS, which provides customer lifecycle operations to clients in UK, Ireland and Australia, has over 11,500 employees. It operates out of Mumbai and Pune and is among the largest captives in the telecom domain.
“This acquisition is in line with our growth plans and is a logical next step in extending our relationship with Hutchison. We are committed to this opportunity and excited about the possibilities this acquisition opens up,” Tech Mahindra executive vice-chairman Vineet Nayyar said.
As part of the deal, clients of HGS have committed to procure services worth $845 million over a five-year period, and have agreed to HGS being their exclusive provider of certain agreed services in India.
“Hutchison’s focused service portfolio combined with our domain knowledge, geographic spread and execution excellence will help us become the undisputed leaders in this space, and extend these services to other verticals and markets,” Tech Mahindra managing director C P Gurnani said.


Sensex, Nifty yet to find direction: Tuesday Closing Report

The market has settled into a low-range trading


The market, which was in the negative for most part of the trading session, picked up momentum in post-noon trade and settled near the day’s high on select buying. Yesterday we had mentioned that the indices are presently directionless and a big move will help it find direction. We continue to maintain the stance. Although the Nifty covered more than yesterday’s loss, the index made a fresh low of the current downfall which began on 24th August. The benchmark moved in a narrow range today. The National Stock Exchange (NSE) saw a volume of 51.66 crore shares and the advance decline ratio was 945:696. 
The market resumed trade on a soft note as tracking the weak Asian markets in morning trade. The Nifty and the Sensex opened five points down at 5,249 and 17,379, respectively. Lack of any fresh domestic triggers kept the market sideways in the negative till the noon session.
Selling in select sectors saw the market fall to its intraday low at around 12.50pm. At this point the Nifty went down to 5,233 and the Sensex dipped to 17,308. However, the benchmarks recovered from the lows as buying in blue chips boosted sentiments.
The indices were firm in late trade as buying activity expanded, despite subdued trading in the European markets following Moody’s downgrade of the Eurozone rating outlook to ‘negative’.
The benchmarks hit the day’s high at the fag end of the session with the Nifty rising to 5,278 and the Sensex climbing to 17,453. The market closed near the high-point of the day. The Nifty gained 20 points to 5,274 and the Sensex added 56 points to settle at 17,441.
Among the broader indices, the BSE Mid-cap index closed 0.53% higher and the BSE Small-cap index gained 0.39%.
The top sectoral gainers were BSE Realty (up 1.59%); BSE Oil & Gas (up 1.19%); BSE Power (up 0.92%); BSE Power (up 0.92%); BSE Consumer Durables (up 0.89%) and BSE Metal (up 0.83%). The two losers were BSE IT (down 0.05%) and BSE Healthcare (down 0.04%).
Of the 30 shares in the Sensex list, 18 settled in the positive. The top gainers were GAIL India (up 2.60%); Jindal Steel (up 2.44%); Reliance Industries (up 1.87%); Tata Motors (up 1.71%) and Tata Steel (up 1.41%). The losers were led by HDFC (down 1.54%); Cipla (down 1.47%); Tata Power (down 1.28%); Bajaj Auto (down 0.98%) and Sun Pharma (down 0.61%).
The top two A Group gainers on the BSE were—Indiabulls Real Estate (up 7.61%) and Torrent Power (up 6.89%).
The top two A Group losers on the BSE were—AstraZeneca Pharma India (down 3.35%) and Castrol India (down 3.20%).
The top two B Group gainers on the BSE were—Nath Seeds (up 19.92%) and Shree Rama Multi Tech (up 19.87%).
The top two B Group losers on the BSE were—Riba Textiles (down 14.29%) and Sharon Bio-Medicine (down 13.82%).
Out of the 50 stocks listed on the Nifty, 32 settled in the positive. The top gainers on the Nifty were GAIL India (up 2.69%); Jindal Steel (up 2.47%); Jaiprakash Associates (up 2.41%); Reliance Industries (up 2.33%) and Tata Motors (up 1.95%). The key losers were IDFC (down 1.86%); HDFC (down 1.83%); Cipla (down 1.44%); Tata Power (down 0.97%) and Sun Pharma (down 0.79%).
Markets across Asia closed mostly lower on concerns about economic growth—both within the region and across the globe—as weak indicators recently showed. Downgrade of the Eurozone rating outlook by Moody’s also weighed on investors.
The Shanghai Composite declined 0.75%; the Hang Seng dropped 0.66%; the Jakarta Composite fell 0.31%; the Nikkei 225 lost 0.10%; the Straits Times slipped 0.19% and the Seoul Composite settled 0.29% down. On the other hand, the KLSE Composite and the Taiwan Weighted added 0.01% each.
At the time of writing, the key European indices were down between 0.29% and 0.76% and the US stock futures were mixed.
Back home, institutional investors continued to pull out funds from the equities segment on Monday, as well. Foreign institutional investors were net sellers of funds totalling Rs54.79 crore and domestic institutional investors were net sellers involving Rs160.70 crore.
State-owned NTPC is awaiting nod from the Arunachal Pradesh government for its proposed Rs1 lakh crore hydro power project, a top company official said today. As per its policy, the state government is believed to have asked NTPC to make an upfront payment of about Rs400 crore for setting up the project. The stock gained 0.80% to close at Rs170.15 on the NSE.
Elecon Engineering Company, a manufacturer of material handling equipment and transmission products, has received letter of intent from Tecpro Systems for the supply of equipment worth Rs26 crore for a project in Andhra Pradesh. The order involves design, engineering, manufacture and supply of equipment for Apgenco-Rayalseema Project-914. Elecon closed at Rs42.95 on the NSE, up 1.92%.
Shriram City Union Finance on Tuesday said it is planning to raise up to Rs500 crore through a public issue of secured non-convertible debentures. The NCDs are proposed with a face value of Rs1,000 each and the public issue opens on 12th September. The funds raised through the issue would be used for the company’s various financing activities and to repay their existing loans. The stock rose 0.45% to close at Rs765.55 on the NSE.


Finance ministry wishes to ignore manipulation in the F&O segment

Questions put to the finance minister on the manipulation in the F&O segment have been vaguely answered. Who is the ministry of finance looking to protect?


Rajeev Chandrasekhar, an independent Member of Parliament (MP) in the Rajya Sabha, recently asked a list of questions pertaining to the Futures and Options (F&O) segment to the finance minister. Most of the questions asked were related to the manipulation in the F&O segment. The questions asked were whether several dubious operator-driven stocks have crashed in response to SEBI’s recent decision to change the eligibility norms for the F&O segment. He also asked for the details of any enquiry made regarding dubious and poor quality stocks being added to the F&O segment.

It seems that the finance minister missed the point and replied that the average decline of the 51 stocks in three weeks from 23 July to 13 August “was only around 0.5% which cannot be termed as a crash warranting an enquiry.” But it’s not all the stocks put together that need to be scrutinised. It is individual stocks that crashed by more than 10% that should have fallen under their radar.

In the first week itself (23 July to 27 July) the 51 stocks which were common to both the NSE and the BSE crashed by an average of 5.95% with around 45 stocks in the red. Out of these, as many as 12 stocks had declined by more than 10% within the week. The Nifty remained flat during this period. Even in the period referred to by the finance minister, there were stock like S Kumars Nationwide and BEML which were down by nearly 30% and 20% respectively. And as many as 25 stocks were negative. Yet these stocks were overlooked. If such is the state of affairs in the ministry of finance, one cannot expect much from the exchanges or even the market regulator.

Moneylife has highlighted the brazen manipulation in creating the F&O list several times in the past. Even as the Securities and Exchange Board of India (SEBI) has stepped in to change the eligibility criteria for F&O nobody seems to have gone into what is, on paper, the role and responsibility of the stock exchanges. Indeed, in a supreme irony, while SEBI’s move is designed at checking manipulation by doing away with illiquid stocks, the bourses have either encouraged manipulation or turned a benign eye towards them.

Read our earlier articles on this:

SEBI slams down on F&O manipulation-I: What was NSE’s role all this while?

SEBI slams down on F&O manipulation-II: NSE and BSE as the first line of regulation stand exposed

Stock Manipulation


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