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Indian state-run companies seek government approval to issue deep discount, long-tenor bonds
Four sources familiar with the matter confirmed on Tuesday that at least six Indian state companies had sought approval from the government to issue corporate bonds at deep discounts. They chose this rarely used structure in order to raise funds for their operations. Sources said that these companies include Indian Railway Finance Corp. (IRFC), Indian Renewable Energy Development Agency. (IREDA), Power Grid Corp of India. (PGC), REC, SIDBI, and NABARD. REC is seeking permission once again to issue these bonds. In September, the company raised 587 million dollars ($50 billion) through aggressive bids, but yields were lower than expected. REC confirmed this development, but no other companies responded to email seeking comment. Deep-discounted bonds are usually issued at a discount of more than 20-25% to their face value. They do not pay interest and have a similar feature to zero-coupon bills that eliminates the risk of reinvestment. These bonds are a great way to reduce borrowing costs for companies, especially in a time when interest rates continue to fall. These bonds offer investors a long-term capital gain benefit, even though they are not tax-free. Bankers say that this, combined with the rarity, is driving up demand for these notes. At maturity, investors will receive a return that is taxed at capital gains rates. The zero-coupon bond is attractive because it reduces the effective tax rate. This was stated by Nikhil Aggarwal. He is the founder and CEO of Grip Invest, an online bond trading platform. Housing and Urban Development Corp. (HUDCO), a state-owned company, became the third to receive approval to issue these bonds last week. One source said, "HUDCO is the most likely candidate. They have the approval. We expect REC and IRFC will be the next candidates." Sources said that the government may approve zero-coupon bonds in phases, as it is not happy with an influx of zero-coupon bond supply. Sources refused to identify themselves as they were not authorized to speak with the media. HUDCO was given approval to raise 50 Billion Rupees via bonds with a 10 year and 1 month maturity, while Power Finance Corp. (PFC) received approval to raise 100 Billion Rupees in the month of March. Both companies have until March 2027 for raising these funds.
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Minority owners demand that oil group Equinor explain discrepancy in climate.
A group of minority shareholders demanded that the board of Norway's Equinor explain how its plan to increase oil and gas production is in line with the Paris Agreement on climate change. Equinor, a 67% state-owned company, has joined Shell and BP this year in pledging higher oil output, while reducing investment in renewables. Minority owners have proposed a resolution that will be voted upon at Equinor’s annual general meeting on May 14. They claim there are "material inconsistencies” between the climate strategy of the company and the expectations expressed by the majority shareholder. The expectations of the Noway government from two years ago included Equinor setting goals and implementing actions to reduce greenhouse gas emission "both short-term and long-term" in accordance with the 2015 Paris Climate Accord. "Other investors have reasonable expectations that a company will move in the direction of aligning with the expectations and wishes of the majority shareholders." Equinor, however, has taken the opposite path," Brynn O'Brien of the Australasian Center for Corporate Responsibility, which filed the motion with the ACCR, stated in a press release. The board of directors at Equinor, however, requested that the shareholders reject the motion. This was also submitted by the Danish pension fund Sampension, and the Swedish pension fund Folksam. In a press release, the board stated that it believed the company's business model and strategy were in line with global goals on climate change. It added that "Scenarios for future energy requirements, including those that align with the goal of limiting global heating to 1.5 degrees Celsius," indicate oil and gas needs will continue to be needed in decades to come. Equinor, Europe's leading pipeline gas supplier. The result of the vote depends on the position taken by the Norwegian government. Generally, the Norwegian government supports the board position at AGMs. The ministry of industry did not respond immediately to a comment request. (Reporting and editing by Terje Solsvik, Nerijus Adomiaitis)
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Halliburton's first-quarter profits fall on North America drilling weakness
Halliburton reported lower first-quarter profits on Tuesday, as a decline in drilling activities in North America dampened the demand for its oilfield equipment and services. Shares of the company fell by 6% before market opening following results which included a $356 million pre-tax charge. Halliburton, the largest U.S. oilfield service provider, is the first to announce earnings. The sector is bracing for the impact that President Donald Trump's new tariffs will have on supply chains. They are also expected to increase the price of steel equipment like drilling rigs and casings. The sector is under pressure due to a continuing decline in drilling activity in North America. Oilfield service firms in North America have struggled due to the reduced U.S. Shale activity. Operators are cutting drilling budgets, focusing on capital management, resulting in lower demand and less rigs operating. Halliburton reported that North America's revenue for the first quarter was $2.2 billion. This is a decrease of 12% from a year ago. The Houston-based firm posted a loss of $204 millions, or 24 cents a share, for the three months ending March 31. This was lower than its profit last year, which was $606 million or 68 cents a share.
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Vance wants closer US-Indian ties but warns that a 'dark period' is coming if not
On a Tuesday visit to India, JD Vance, the Vice President of the United States, said that the United States was looking to sell more defence and energy equipment to India. He added that the ties between India and the United States will shape this century. In a speech delivered in Jaipur, a city in northwestern India, he stated that if India and the United States worked together effectively we would see a prosperous and peaceful 21st century. "But I believe that the 21st Century could be very dark for humanity if we do not work together effectively." After their dinner, he praised Narendra Modi repeatedly. Vance, his wife (who is the daughter an Indian immigrant) and their three kids are on a four-day, mostly personal visit to India. The visit comes as India rushes to seal a trade deal before the 90-day suspension of tariffs announced by the Trump administration. "Prime Minister Modi has a reputation as a tough negotiator." Vance, to loud laughter in the audience, said that Modi is a tough negotiator. Nirmala Sitharaman, Indian Finance minister, said on Monday in San Francisco that India hopes to have "positively concluded" the first portion of a new trade agreement by autumn. Vance confirmed that he and Modi had made progress in the trade negotiations and confirmed the finalisation of the terms for reference. He said that the roadmap outlined in the document would lead to a final agreement between our two nations. Reporting by Rupam JAIN; Writing by Sakshi DAIL; Editing By YP RAJESH and Kim Coghill
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Copper gains defy gloomy outlook
The copper price hit its highest level in over two weeks on the Monday after a weaker US dollar triggered fund purchases. However, traders are unsure that this upward momentum will continue as long as U.S. tariffs dominate sentiment. The levy imposed by Donald Trump has harmed the outlook for economic growth in the world and for demand for industrial metals. By 1126 GMT, the benchmark copper price on London Metal Exchange (LME), which had reached its highest level since April 4, was now up 1.5% to $9,325 per metric tonne. One copper trader stated that the market was not based on fundamentals but rather on funds buying as a reaction to the dollar, and people cutting short positions. Concerns over the independence and credibility of the Federal Reserve have impacted the currency after Trump's attacks on Fed chief Jerome Powell. A weaker dollar makes metals priced in dollars cheaper for buyers of other currencies. This could boost demand. This relationship is used in the trading of funds called commodity trading advisors, which trade on signals generated by numerical models. Copper has broken through resistance on the technical front at the 50-day- and 100-day-moving averages, respectively, at $9,290 and $ 9,330. The 21-day moving avg. is $9,380. This represents the next barrier to the upside. The Shanghai Futures Exchange's (ShFE) warehouse stocks, which fell 36% since February to 171,611 tonnes, and lower inventories at Shanghai's bonded storage facilities are supporting copper prices. . Citi analysts in a China note said that while trade conflicts are expected to affect demand in the second- and third-quarters, businesses hope for stimulus to offset this. Dealers are optimistic that the domestic market will remain resilient, despite recent export headwinds, they wrote. Other metals saw a 0.8% increase in aluminium at $2,384 per ton. Zinc gained 1.5% at $2,616, while lead was up by 0.6% at $1,933. Tin was up 1.3% at $31,030, and nickel rose 0.4% to $15,690.
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Argentex, a FX company, suspends its trading of shares due to market volatility
The shares of British currency management firm Argentex, which is based in London, were suspended on Tuesday. Argentex said that the sharp drop in the U.S. Dollar had caused a serious deterioration in its liquidity. The company stated in a filing that "Argentex is exposed to significant volatility of foreign exchange rates... As a result, (it) experienced a rapid impact on its short-term liquidity position due to, inter alia margin calls related to its FX Forward and Options books." It stated that it has the support of its main liquidity provider, and is looking to strengthen its positions. However, "in the event the volatility on the currency markets worsens, the company's liquidity position will be stretched if it does not improve in the near future." The global markets have been volatile this month as President Donald Trump’s tariff policy has increased uncertainty about the economy. Argentex stated that it was particularly exposed to the "rapid devaluation of the U.S. Dollar against other major benchmark currency." According to LSEG, the dollar is at its lowest level in three years compared with a basket major currencies. It's also on track for its worst first-four months performance in 50 years. Analysts believe that its decline can be attributed to global investors selling U.S. investments due to concerns about the health of U.S. businesses and the economy Argentex's website describes it as "a global expert in currency risk and alternative banking". It offers its clients payment services and strategies to hedge their currency risks. The company's shares were suspended Tuesday, but they have already logged a 50% gain in 2025. (Reporting and editing by Amanda Cooper, Susan Fenton and Samuel Indyk)
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Severstal, a Russian company, blames the economic slowdown for a 55% drop in its first-quarter profits
Severstal, a Russian steelmaker, said that the economic slowdown in Russia and the reduced demand for steel in the construction and machine building industries led to a drop of 55% in its net profit during the first quarter. In a press release, Alexander Shevelev, the CEO of the company, said that "economic cooling measures, especially the high key rate, continue to put pressure on all major consumers" of rolled metal. Government forecasts predict that Russian economic growth will slow this year to 2.5% from 4.3% by 2024. The central bank's main interest rate is still at 21% - the highest level since the early 2000s. He added that "our estimates indicate that the steel consumption in Russia has decreased by about 13% on an annual basis, primarily due to reduced economic activities in the construction and machinery-building sectors." Earnings before interest, tax, depreciation and amortization (EBITDA), which are the company's earnings, fell by 40% during the first quarter. Revenues, however, only decreased by 5%. The company announced that it would not be paying a dividend for the first quarter due to "market uncertainties". Shevelev stated that the company was able to increase its sales of metal products and high-value products by 9% despite difficult economic conditions. The company increased investment by 140% during the first quarter thanks to a cash cushion. Many Russian companies claim that high interest rates stifle investment. (Reporting and Anastasia Lyrchikova, Writing by Gleb Brnski; Editing Jan Harvey)
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Japan's crude steel production falls 4.5% in fiscal 2020/21 due to weak construction demand
The world's third largest producer of crude steel, Japan, saw its output fall 4.5% during fiscal 2024/25. This was due to a lackluster demand for construction and manufacturing, as well as sluggish exports, as China, the top producer of steel in the world, increased exports. The Japan Iron and Steel Federation announced on Tuesday that the output, which was not adjusted for season, fell to 82.95 millions metric tons during the year ending March 31. This is the third consecutive drop in annual production. According to an analyst with the Federation, production was at its lowest level since fiscal 2020/21. A collapse in demand caused by the COVID-19 epidemic pushed the production to the lowest point it had been for roughly 50 years. The analyst stated that "steel demand has been dampened by construction delay caused by labour shortages, high material costs and a slow recovery in the automotive and other manufacturing sector." He added that "as well, a surplus of steel in the overseas market due to China's massive exports has contributed to reducing Japan's exports." The production is expected to decline as Nippon Steel closed one of their blast furnaces by the end of March, and JFE Steel will temporarily suspend one blast furnace in mid-May. The analyst also said that U.S. Tariffs have increased uncertainty regarding steel demand. Tadashi Imai, chairman of the Federation, warned that U.S. steel and auto tariffs could cause Japan's crude steel production to drop by several millions tons, down to 80 million tons. No exemptions were allowed by President Donald Trump when he raised import duties for steel and aluminum to 25% on March 12. On April 2, tariffs on auto parts and vehicles went into effect. Analysts at the Federation said that in March, Japan's crude-steel output increased by 0.2% compared to a year ago, reaching 7.21 million tonnes. This was the first rise in 13 months. However, local demand continued to be weak. The output was up 12.6% compared to February. (Reporting and editing by Kim Coghill; Yuka Obayashi)
Iranians are fighting a 'water crisis'
Iranians are urged to reduce water consumption as dam levels drop
Farmers in the United States are suffering from a nationwide water shortage
The shortfall is similar to an overdrawn account
By Sanam Mahoozi
The water levels in the dams surrounding the capital are at an all-time low. Water rationing is expected this summer, as the country wilts from a severe drought.
As water levels decline, lakes are disappearing and farmers are struggling. In cities, huge sinkholes appear.
The kitchen taps often run dry, and students are concerned about the washing.
Last week, the managing director of Tehran’s Water and Sewage Department announced that reserves at key dams which supply nearly all of the city’s drinking water had dropped to their lowest level in history. They were only 5% of their capacity.
Mohsen Ardakani, urging residents to reduce water consumption by 20% or more before the New Year celebrations that begin on March 20.
He said, "This is not an option or a choice -- it's essential to get us through these difficult times."
Local media broadcast images of the Alborz Mountains north of Tehran, where the Amir Kabir Dam (which is only 6% full) was almost empty and the Latian Dam (10% full). The capital has seen a 17% drop in rainfall compared to last year and is 42% below its long-term average.
The TV reports that there might not be enough water for us to drink tomorrow. I worry about the impact this is having on my family's mental and physical well-being every night.
My father is afraid of taking showers, and my mother is scared to drink water containing the medication she needs to treat her kidney condition. "They say they want the water to be saved for the younger generation to survive and use," she said.
Kaveh Madani, former deputy director of Iran's Department of Environment and the Director of the U.N. University Institute for Water, Environment, and Health, UNU-INWEH, stated that the country is experiencing "water bankruptcy".
"If water resources were viewed as assets, surface water would be a checking and savings account while groundwater is a bank account, Iran has depleted their reserves leaving the public in a similar situation to a bank account that's overdrawn," Madani said.
FARMERS SUFFER
Masoud Pezeshkian, the president of the Tehran Council, said that the rapid urbanization made it impossible for the 19,000,000 people living in the capital city and its surrounding areas to maintain their current consumption levels.
Pezeshkian stated that "scientists and experts must sit down and solve the water problems of the city."
Iran's National Water Information and Data Office reports that the water flow into dam reservoirs in Iran is 28% lower than last year. Storage levels at some dams in 10 provinces are now less than 15%.
Reservoirs are located near Isfahan and Zanjan provinces. Summer temperatures can reach over 50 degrees Celsius.
Scientists claim that the main causes of water shortages have been mismanagement over decades, inefficient farming practices and an increasing population. However, climate change has also exacerbated this problem.
Mohsen Megaran, assistant Professor of Plant Sciences at UC Davis, California, stated that agriculture, which is responsible for 90% of Iran’s water consumption, is the primary driver of the crisis.
He said: "While it is understandable that Iran only receives about a fourth of global average rainfall, agricultural productivity remains low in comparison to this limited rain."
A 36-year old farmer in East Azerbaijan, northwest Iran, said that water shortages are driving farmers from the area surrounding Lake Urmia. Once the largest saltwater lake in the Middle East, the area is now a vast, desert.
Our wells and groundwater have also dried up. "Our wells and underground water have also dried up," said a farmer from Bonab Village, who refused to reveal his name out of fear of reprisals.
The government only digs deeper wells. "I don't think we have anyone left to whom we can express our sorrow and pain."
Iran is already under pressure from U.S. Sanctions, as more than 4 million people are employed in agriculture, which represents 80% of the country's economy.
Mesgaran said that it is difficult to reduce the agricultural activity of these farmers unless government provides alternative employment opportunities.
LAND SUBSIDING
Land subsidence has been caused by excessive extraction of groundwater and its depletion for agriculture. Cracks and sinkholes have appeared in cities and sometimes even swallowed whole cars.
In Tehran, land subsidence rates are 31 cm per year.
Any land under highways or airports in industrial cities like Isfahan Khashan Yazd now faces the risk of collapsing.
Water shortages disrupted the most basic of routines for a 25-year old psychology student in Shiraz in south-central Iran.
The student said, "It is getting harder to do simple things like wash my face and body. Sometimes I have to sit for hours before the water comes back on." She did not wish to be identified for fear of repercussions from the authorities.
(source: Reuters)