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Etihad Seeks to Increase Stake in Jet, Uber Files For IPO, Disney Unveils Disney+, Q4 Results Infosys and TCS, SC Halts ArcelorMittal's Payment for Essar et al.

Professor of Financial Economics and Part-time Value Investor, Transfin.
Apr 12, 2019 2:19 PM 4 min read

Etihad seeks to increase stake in Jet, submits expression of interest. Supreme Court halts ArcelorMittal’s INR42,000cr payment for Essar Steel. TCS reports c. 18% growth in consolidated net profit in Q4 FY2019. Infosys Q4 profit grows 11% YoY to INR4,078cr. Uber files for IPO; reveals massive losses. Disney to launch video streaming service Disney+ on November 12.


Moving on to the top Business stories of the day. 



Etihad seeks to increase stake in Jet, submits expression of interest. SpiceJet to induct 16 new planes. Tata, Singapore Airlines infuse INR900cr in Vistara.

Nod of Approval: Abu Dhabi-based Etihad Airways which currently holds 24% stake in Jet Airways has submitted an Expression of Interest (EoI) to increase its stake in the debt-ridden domestic airline. 

It can raise its holding in Jet to 49%, the maximum that a foreign carrier can hold in a domestic airline.

Recap: Today is the last day for submitting EoIs, after it was extended from April 10, to accommodate more bids. Till date, five companies (excluding Etihad) have submitted EoIs in buying stake in Jet Airways.

Strike While the Iron is Hot: SpiceJet is set to induct 16 Boeing 737-800 NG aircraft on dry lease. The new aircrafts can be deployed in ten days, subject to regulatory approvals.

The move comes at a time when airlines capacity has reduced in recent weeks due to grounding of Boeing 737 Max and Jet Airways aircrafts. This could help bridge the capacity gap in the industry and stabilize ticket prices.

Tata Sons and Singapore Airlines have infused a combined  INR900cr in their joint venture airline Vistara.

Pump it Up: Tata Sons Ltd and Singapore Airlines Ltd have invested INR900cr in their joint venture airline Vistara, in an attempt to improve its financial health and take the delivery of new planes from Airbus SE and Boeing. The injection also aims to achieve a threefold expansion in Vistara’s fleet by 2023.



Supreme Court halts ArcelorMittal’s INR42,000cr payment for Essar Steel. Vedanta Resources raises $1bn via bonds. 

No Go: The SC’s two-judge bench headed by Justice Rohinton F. Nariman has said status quo is to be maintained regarding Arcelor’s plan to buy Essar Steel. The court directed the bankruptcy appellate tribunal to expeditiously decide on appeals in the case.

Backstory: NCLT had approved Arcelor and its partners Nippon Steel’s offer to pay $6 billion upfront to lenders and invest about another $1.1bn in the company to turn it around.

The Waiting Room: As per JSW Steel, delays in the sale of assets under India’s bankruptcy law are becoming a key challenge for bidders who “cannot wait indefinitely" because of funding constraints. Read the entire matter here.

Also This: Vedanta Resources, through its wholly-owned subsidiary, Vedanta Resources Finance, has raised $1bn through bonds. The company will use the net proceeds primarily to repay debt.



TCS reports c. 18% growth in consolidated net profit in Q4 FY2019. Infosys Q4 profit grows 11% YoY to INR4,078cr. 

TCS: Tata Consultancy Services reported a c. 18% growth in consolidated net profit, beating expectations at INR8,126cr for Q4 FY19 vs a net profit of INR6,904cr previous year.

For the entire fiscal, net profit was higher by c. 22% at INR31,472cr, while revenue increased 19% to INR1,46,463cr. 

"This is the strongest revenue growth that we have had in the last fifteen quarters. Our order book is bigger than in the prior three quarters, and the deal pipeline is also robust. Despite macro uncertainties ahead, our strong exit positions us very well for the new fiscal," said Rajesh Gopinathan, CEO and MD of TCS.

Infosys: Infosys reported 10.5% growth in consolidated net profit at INR4,078cr for Q4 FY19 vs INR3,690cr previous year. Revenue grew 19% to INR21,539cr in the quarter under review from INR18,083cr previous fiscal.



Uber files for IPO; reveals massive losses. 

Renewed Questions: The ride-hailing giant, Uber filed for IPO on Thursday, but the prospectus renewed questions about how sustainable Uber’s business actually is.

Uber in its filing said that it had lost $1.8bn in 2018, excluding certain transactions, on revenue of $11.3bn. 

As the company aims for a valuation of as much as $100bn, the filing shows that the spectacular growth Uber has enjoyed in its core ride-hailing business has leveled off lately. Uber generated more than $11bn in net revenue last year, a 42% growth rate from the year before — although it’s noteworthy that the rate slowed to 22% in Q4 of 2018 from 69% in Q1 2018.

Bonus: Uber is huge, sprawling and still entirely unproven. Here’s a deep dive into why investors are going to have a tough time figuring out how to value the company.


Disney to launch video streaming service Disney+ on November 12. PayU acquires digital payments security company, Wibmo for $70m.

Walt Disney is set to launch its new streaming service, Disney+ on November 12. 

Netflix-Slayer?: The service will be available at a price of $6.99 a month - nearly half the cost of Netflix. 

Disney+ will be an ad-free subscription service anchored by programming based on Disney’s biggest franchises, including “Star Wars” and Marvel Studios, as well as original programming. 

The Spread: In addition to Disney films and TV shows, it will feature programming from the Marvel superhero universe, the "Star Wars" galaxy, "Toy Story" creator Pixar animation and the National Geographic channel. 

Omnipresent: The company said it has struck deals with Roku and Sony to distribute Disney+ on streaming devices and console gaming systems and expects it to be widely available on smart televisions, tablets, and other outlets by launch. 

There’s More: Digital payments platform PayU has announced the acquisition of California-based payments security and mobile payments technology company Wibmo for $70m.

PayU, which is the fintech arm of South Africa’s Naspers would combine its merchant network and  Wibmo’s  digital transaction security solutions to offer payments solutions to merchants and financial institutions in India and other high growth markets.


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