After opening the day on a flat note, the Indian share markets have continued to trade flat, with a positive bias. Sectoral indices are trading on a mixed note with stocks in the FMCG sector witnessing maximum selling pressure. Realty stocks are trading in the green.

The BSE Sensex is trading up 48 points (up 0.2%) and the NSE Nifty is trading up 14 points (up 0.2%). Meanwhile, the BSE Mid Cap index is trading up by 0.2%, while the BSE Small Cap index is trading up 0.3%. The rupee is trading at 67.86 to the US$.

Bharti Airtel has announced that it will acquire Middle East North Africa Company Submarine Cable Systems (MENA-SCS).

Airtel said, its subsidiary Network i2i has entered into a definitive agreement with Egyptian firm Orascom, to acquire the latter's entire equity stake in MENA-SCS for an undisclosed amount.

MENA-SCS, a 100% subsidiary of Orascom owns and operates a submarine cable network between India and Europe covering the Middle-Eastern region.

MENA cable is live and operational connecting Mumbai -Oman-Saudi Arabia-Egypt and Italy. It further has the branching options to connect to other countries in Europe, Africa and West Asia, Cyprus, Greece, Djibouti, Yemen, Iran, Lebanon, Libya and Sudan.

Commenting on the acquisition Ajay Chitkara, Director and Chief Executive Officer (Global Voice and Data Business) of Airtel said,

"The additional capacity will enable Airtel to serve the growing demand for data services and enterprise services across its footprint of 18 countries across South Asia and Africa. In particular, it will provide impetus to India's emergence as a major regional internet hub serving customers across Saarc region, with seamless global connectivity."

The proposed acquisition of MENA-SCS is aimed at further strengthening Airtel's global network that currently runs across 225,000 route kilometers, covering 50 countries and 5 continents.

In other news, facing temporary disruption in business due to demonetisation, public sector undertaking (PSU) banks have sought higher capital infusion from the government. Reportedly, The Reserve Bank of India (RBI) too has endorsed their view of higher capital infusion.

Under the roadmap announced last year, the government will infuse Rs 250 billion in PSU banks during the current fiscal. The government in July had announced the first round of capital infusion of Rs 229 billion for 13 PSU banks. Of this, 75% has already been released to these banks.

According to a leading financial daily, the banks met finance minister Arun Jaitley in a pre-budget meeting and suggested the government continue capital infusion next year, provide full tax exemption towards provisions for non-performing assets (NPAs) and reduce tax rates for companies increasing employment.

The demands have been spurred due to a disruption caused by demonetisation. Shares of most state-owned banks however have rallied since demonetisation on the back of swelling deposits and falling treasury yields, and are surprisingly turning out to be better performers than their private-sector counterparts, even as the problem of bad loans continues to weigh.

The demonetisation effect may well be a short term phenomenon on the performance of PSU banks. Many of them have been performing steadily over the past fiscal and is evident from the chart below:

Are the PSU Banks on the verge of a turnaround?

It remains to be seen how demonetisation affects the PSU banks in the long run. As many economic triggers, including the budget, await in the near future.