Latest news with #Currency
India Gazette
3 days ago
- Business
- India Gazette
Higher risk buffers by RBI strengthen its balance sheet, support India's macroeconomic outlook: ICICI Bank Report
New Delhi [India], June 3 (ANI): The Reserve Bank of India's (RBI) decision to maintain higher risk buffers is expected to strengthen its balance sheet and support India's macroeconomic fundamentals, especially at a time when global oil prices are expected to remain benign, according to a recent report by ICICI Bank. The report noted that the RBI's strong risk buffer not only adds to its financial resilience but also provides a tailwind for the broader Indian economy. It said 'we believe higher risk buffer by RBI strengthens its balance sheet and provides a tailwind for India's macroeconomic fundamentals when oil prices too are expected to be benign'. The central bank's balance sheet stood at Rs 76.3 trillion as of FY25, marking an 8.2 per cent increase over the previous year. Since FY2022, the balance sheet has expanded by 23 per cent, which is lower than the nominal GDP growth of 40 per cent during the same period. In contrast, during the pandemic years from 2019 to 2022, RBI's balance sheet grew by 50 per cent, while nominal GDP rose by only 25 per cent. According to the report, the RBI's balance sheet is expected to grow in line with or faster than nominal GDP in the coming years, supported by an accommodative policy stance. In FY25, the expansion was primarily driven by an increase in domestic securities, which rose by 14.3 per cent year-on-year to Rs 15.6 trillion. Foreign securities saw a modest increase of 1.7 per cent year-on-year to Rs 48.8 trillion, mainly due to muted foreign investment flows. On the asset side, the sharpest rise was in gold holdings, which surged by 52 per cent year-on-year to Rs 6.7 trillion. The central bank added 57 tonnes of gold during the year. On the liabilities front, the growth was led by the Currency and Gold Revaluation Account (CGRA), which rose 15.2 per cent year-on-year to Rs 13 trillion. This was attributed to higher global gold prices and the depreciation of the Indian rupee during the year. The RBI earned Rs 1.1 trillion from its foreign exchange operations in FY25, a 33 per cent jump compared to the previous year. The gross sales and purchases during the year amounted to Rs 65 trillion, compared to Rs 29 trillion in FY24. However, the average spread narrowed to 1.7 per cent in FY25 from 2.9 per cent in FY24, mainly due to a lower average depreciation of the rupee, 2.1 per cent this year compared to 3 per cent last year. The report added that the outlook for foreign exchange has shifted fundamentally. While the US dollar was strong last year due to economic exceptionalism, the dollar index has declined by 8.3 per cent in 2025 so far. This change has improved the position of emerging market currencies, including the rupee. (ANI)
Yahoo
31-03-2025
- Business
- Yahoo
Shift4 Payments, Inc. (FOUR): A Bull Case Theory
We came across a bullish thesis on Shift4 Payments, Inc. (FOUR) on Substack by PatchTogether Investing. In this article, we will summarize the bulls' thesis on FOUR. Shift4 Payments, Inc. (FOUR)'s share was trading at $84.58 as of March 28th. FOUR's trailing and forward P/E were 27.91 and 17.76 respectively according to Yahoo Finance. A businessman at a smart POS terminal, demonstrating contactless payment methods. Shift4's stock has declined by 20% following its announcement of a $2.5 billion acquisition of Global Blue, a leader in tax-free shopping and currency exchange payment solutions. The deal, funded through a mix of cash and revolving credit, has raised concerns over its financial impact and long-term value. However, a closer look at the numbers suggests it could be a transformative move for Shift4. On an EBITDA basis, the acquisition appears reasonable, with Global Blue contributing approximately $190 million in EBITDA, implying a 13× acquisition multiple. Expected synergies of $70 million by 2027 could push EBITDA to $260 million, reducing the multiple to around 9.5–10× EV/EBITDA. While free cash flow metrics indicate a less attractive 20× multiple, the acquisition aligns with Shift4's strategy of entering new markets, enhancing capabilities, and driving cross-sell opportunities within acquired networks. Global Blue provides Shift4 with a significant new revenue stream. The company generated approximately €422 million ($450 million) in revenue for FY2023/24, and once the deal closes in Q3 2025, Shift4's topline will benefit immediately. More importantly, Shift4 can cross-sell its payment processing services to Global Blue's 400,000+ merchant locations, unlocking a major growth avenue. Global Blue currently relies on acquiring partnerships for payment processing, handling roughly €28.3 billion ($30 billion) in transactions annually. If Shift4 captures even a portion of that volume at its 0.8% standard take rate, it could generate up to $240 million in new revenue. Additional high-margin opportunities exist in cross-border payments and currency conversion services such as Dynamic Currency Conversion (DCC) and Multi-Currency Pricing (MCP). Shift4's existing network of hotels and resorts can integrate Global Blue's DCC services, allowing international guests to convert their payments into their home currency at checkout. If just 3% of estimated 2025 transactions ($200 billion) utilize DCC with a 2% FX spread, Shift4 could generate over $100 million in additional revenue. The acquisition also strengthens Shift4's positioning in the restaurant and entertainment sectors. Its extensive network of restaurants, casinos, and stadiums can implement multi-currency options, improving customer experience while capturing additional revenue. Luxury retail presents another opportunity—Global Blue's partnerships with brands like Prada and Louis Vuitton position Shift4 to provide unified commerce solutions that bundle payment processing, eCommerce, and tax refunds, differentiating it from competitors such as Adyen and Stripe. Additionally, the acquisition expands Shift4's geographic footprint, particularly in Europe and Asia, where it previously had limited exposure. With nine new countries expected to adopt tax-free shopping, the transaction volume potential increases further. However, the deal also introduces financial risks. A $1.8 billion bridge loan will finance part of the acquisition, increasing Shift4's leverage and putting pressure on cash flows. Higher interest rates in a downturn could drive up expenses significantly, and if expected synergies fail to materialize, financial strain could follow. To mitigate this risk, Shift4 must prioritize refinancing the bridge loan with long-term debt as soon as possible. Despite these risks, Shift4's cash flow outlook remains strong. Over the past year, the company generated $500.3 million in cash from operations, with an adjusted free cash flow of $380.8 million. Management has guided for 25% annual growth over the next three years, which could drive cash flow to $744 million by 2027. With Global Blue's integration, EBITDA and gross revenue could exceed a 30% compound annual growth rate. By 2027, Shift4's total debt load, including Global Blue's term loan, will likely reach $3.52 billion, with estimated interest costs of $237 million annually. Subtracting this from projected cash flow leaves an estimated owner's cash flow of $507 million. At current trading levels, Shift4 is valued at approximately 15× its projected 2027 earnings, with upside potential if growth targets are met. In the best-case scenario, Shift4 successfully integrates Global Blue, captures a meaningful share of payment volume, and realizes its synergy targets, driving stock re-rating. Shift4 Payments, Inc. (FOUR) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 38 hedge fund portfolios held FOUR at the end of the fourth quarter which was 27 in the previous quarter. While we acknowledge the risk and potential of FOUR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than FOUR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None. This article was originally published at Insider Monkey. Sign in to access your portfolio
Yahoo
12-02-2025
- Business
- Yahoo
Trump Plans to Pick Quintenz as Head of US Derivatives Regulator
(Bloomberg) -- President Donald Trump plans to pick Brian Quintenz, the head of policy at Andreessen Horowitz's a16z crypto arm, to lead the Commodity Futures Trading Commission, according to a document sent by the White House to Capitol Hill that was reviewed by Bloomberg News. Saudi Arabia's Neom Signs $5 Billion Deal for AI Data Center Nice Airport, If You Can Get to It: No Subway, No Highway, No Bridge Sin puente y sin metro: el nuevo aeropuerto de Lima es una debacle The Forgotten French Architect Who Rebuilt Marseille In New Orleans, an Aging Dome Tries to Stay Super Quintenz served as a Republican commissioner at the CFTC during the first Trump administration before joining the venture capital firm. The agency is the primary US watchdog for the roughly $400 trillion swaps market and other derivatives. Quintenz has been a vocal advocate for regulatory changes that would benefit digital-asset firms and other new technologies and financial products. If confirmed, he's expected to push for changes that could help the CFTC rise in prominence as the preferred regulator for crypto. According to the same document, Jonathan Gould would be nominated as Comptroller of the Currency, and Jonathan McKernan would be tapped as director of the Consumer Financial Protection Bureau. The White House did not immediately respond to a request for comment about Trump's plans for the nominations. Trump picked junior Republican CFTC Commissioner Caroline Pham in January to serve as acting chair. Rodney Hood, formerly the head of the National Credit Union Administration, was selected recently as acting Comptroller of the Currency. The fate of the CFPB has grown increasingly uncertain in recent days as acting Director Russell Vought — who also leads the White House Office of Management and Budget — has ordered halts to much of the agency's work. --With assistance from Jennifer A. Dlouhy. Why Fast Food Could Be MAHA's Next Target Trump's Tariffs Make Currency Trading Cool Again After Years of Decline The Game Changer: How Ely Callaway Remade Golf Trump Promised to Run the Economy Hotter. His Shock and Awe May Have a Chilling Effect Orange Juice Makers Are Desperate for a Comeback ©2025 Bloomberg L.P.
