'The recent correction in indices has made the markets cheaper to invest for the long term.'
India's GDP may turn positive at 1.3 per cent in the third quarter of 2020-21, having witnessed contraction in the previous two quarters due to the coronavirus pandemic, as the number of cases is falling and public spending has started rising, according to a report. The government will release the GDP numbers for the October-December quarter of the current fiscal on Friday. Projecting that the gross domestic product (GDP) may have returned to the black in the last quarter of the calendar year 2020, DBS Bank in the report said the full-year growth in real terms may be at a negative 6.8 per cent.
Since January 2021, the inflation rate in health has stood in the range of 6.08-8.44 per cent.
The Reserve Bank may be hitting the end of its tolerance for high inflation and will most likely hike interest rates in the first half of 2022, analysts said on Friday. The central bank will also start rolling back its accommodative policies which have led to easy liquidity conditions, they said. The view from analysts came even as inflation cooled down to 5.6 per cent for July, after two months of breaching the upper end of the RBI's tolerance band of 6 per cent.
In the past 10 trading sessions, shares of the state-owned company have shot up more than 50 per cent.
FY22 will be the year to rebuild with the IMF projecting output growth at 11.5 per cent, economic survey at 11.0 per cent and the RBI's Monetary Policy Committee at 10.5 per cent.
While analysts remains overweight on financials, property, discretionary, industrials and materials, they maintain a neutral stance on pharma, telecom and energy; and underweight on staples, utilities, and IT services.
The government is expected to defer the mega initial public offering (IPO) of LIC to the next financial year as the ongoing Russia-Ukraine war has dampened fund managers' interest in the public issue, market experts said on Sunday. The government was looking to sell 5 per cent stake in Life Insurance Corporation (LIC) this month, which could have fetched over Rs 60,000 crore to the exchequer. The IPO would have helped meet the curtailed divestment target of Rs 78,000 crore this fiscal.
Citing the impact of the second wave of the pandemic over the economy and consumer sentiment, Swiss brokerage Credit Suisse has lowered its nominal GDP growth forecast by 150-300 bps to 13-14 per cent, but expects a stronger recovery in the second half as it sees the lockdowns having limited impact on tax collections. Last month, Neelkanth Mishra, the co-head of equity strategy for Credit Suisse Asia Pacific, and India equity strategist, had told PTI that he expected the real GDP to fall to 8.5-9 per cent in FY22 due to the more severe pandemic attack. The virus case load has crossed the 25-million mark, death toll from the same is nearing 2.9 lakh mark, which is one of the highest in the world as the test positivity rate has been around 15 per cent for long.
The Budget, to be presented on February 1, is likely to be less worried about fiscal deficit and will be focused more on nursing the fragile growth, according to a Wall Street brokerage report. Bank of America Securities India expects the budget to peg "fiscal deficit at a high 5 per cent of GDP for FY22 and 7.2 per cent for FY21, as it is likely to step up capex, recap public sector banks, push asset sales to break government monopolies, offer sops for real estate, tax cuts for lower income groups and creation of a bad bank". Its house economists expect these spends to be funded by debt and partly by imposing a cess on high income groups and also by some non-fiscal measures like tapping the central bank's revaluation reserves and bank recapitalisation and infra bonds.
After a stellar run in 2021 that saw the S&P BSE Sensex and the Nifty50 clock gains of 20 per cent and 22 per cent respectively, global equity markets, including India, are gearing up to welcome 2022 on a cautious note. For one, new variants of the Covid -19 infection that make current vaccines less effective is one of the key risks worth flagging, analysts said. Inflation was also a risk for this asset class in 2021, although most market participants expect that the current elevated inflation levels will be transitory.
With the spectrum auction now delayed till at least next May, the expected 5G orders for telecom equipment have not been sealed, the companies point out. Surajeet Das Gupta reports.
Investors became richer by over Rs 6.34 lakh crore on Monday as markets gave a big shout-out to the Budget 2021-22, which analysts termed as 'unprecedented' against the backdrop of the pandemic-induced slowdown. Cheering the Budget proposals, the BSE benchmark Sensex zoomed 2,314.84 points or 5 per cent to close at 48,600.61. During the day, it jumped 2,478.63 points to 48,764.40. This was the best Budget-day gain for the markets since 1997, analysts said. Following the extremely positive market sentiment, the market capitalisation of BSE-listed companies rallied Rs 6,34,069.67 crore to Rs 1,92,46,713.70 crore.
'India has entered an economic super-cycle driven by a housing cycle turnaround.'
Indian economy is expected to grow 10.5 per cent or more in the current fiscal, Niti Aayog Vice Chairman Rajiv Kumar said on Thursday. Speaking at a virtual conference organised by the Public Affairs Forum of India (PAFI), he also said that modernisation of the retail sector is very much on the cards. "India Purchasing Managers' Index (PMI) for both manufacturing and services has shown a very smart uptick last month. "This (Indian economy) will strengthen even further," he said. "I expect Indian economy to grow 10.5 per cent or higher in FY 22," he noted.
While the Indian Institute of Technology (IIT) Kanpur may have attracted among the highest donations by an individual (former student and IndiGo Airlines co-founder Rakesh Gangwal) at Rs 100 crore last week, IITs have largely seen such contributions rise over recent years, despite the Covid pandemic. According to Mahesh Panchagnula, dean, Alumni and Corporate Relations, IIT Madras, in the last five years, the premier institute has raised more than Rs 135 crore under the endowment category of education alone. Despite the pandemic, there has been an increasing trend in endowment funding received at IIT Madras, with an average increase of about 20 per cent year-on-year across the last five years.
Wall Street brokerage Goldman Sachs has lowered its estimate for India's economic growth to 11.1 per cent in fiscal year to March 31, 2022, as a number of cities and states announced lockdowns of varying intensities to check spread of coronavirus infections. India is suffering the world's worst outbreak of COVID-19 cases, with deaths crossing 2.22 lakh and new cases above 3.5 lakh daily. This has led to demand for imposition of nationwide strict lockdowns to stem the spread of the virus - a move that the Modi government has so far avoided after the economic devastation last year from a similar strategy.
Global forecasting firm Oxford Economics on Monday revised downwards its India GDP growth forecast for 2021 to 10.2 per cent from 11.8 per cent previously, citing the country's escalating health burden, faltering vaccination rate and lack of a convincing government strategy to contain the pandemic. Oxford Economics also said that notwithstanding the likelihood of further mobility restrictions, it expects India's targeted lockdown approach, less stringent restrictions, and resilient consumer and business behaviour to mitigate the economic impact of the second wave.
Once stability returns to the secondary market, companies that have obtained approval from Sebi will start tapping the market.
In May, Satpal Singh, who runs a dairy business with three buffaloes in Jewar, near Noida, was worried about the steep spike in input costs. Singh said dry fodder rates, which cost Rs 1,500-2000 per tractor trolley last year, were quoting at Rs 4,500-5,000. The price of other cattle feed ingredients (that include mustard meal and similar mixes) had also gone up from Rs 2,000 per quintal to Rs 3,100-3,200 per quintal.
'The business continuity clause will mean the Tatas will have to keep running the airline for three years, and cannot exit the flying business.'
AI and machine learning will only continue to grow in 2022, with a significant increase in the demand for such roles, notes Sekhar Garisa, CEO, Monster.com.
North Block is concerned that when India is trying to attract more investment, putting up restrictions on audit firms could create an avoidable bad advertisement.
Tata Steel was the top loser in the Sensex pack, shedding over 2 per cent, followed by Sun Pharma, ICICI Bank, SBI, Kotak Bank and Dr Reddy's. NSE Nifty dropped 151.75 points to 15,727.90.
With all major US export-oriented drug manufacturing plants in the country up for inspection in 2022, some estimates peg that at least 20-30 per cent of the new product launches lined up for the US will be subject to on-site inspection by the US Food and Drug Administration (USFDA). The last two years saw limited physical inspections due to travel restrictions during the pandemic. "Pre-Covid, the frequency and number of inspections of manufacturing plants in India by USFDA had increased significantly," analysts from ICICI Securities Research noted. "With growing ANDA filings, especially for complex products. "We expect this trend to return with the environment normalising," analysts from ICICI Securities Research noted.
While domestic market growth is important, the sales trajectory in the international markets, which account for 45 per cent of the revenues, will be a key rerating trigger, say analysts.
'At present Metaverse is a hype cycle.' 'If it succeeds, then I would like to see TCS there, too.'
Despite headwinds, it remains "structurally bullish" on India and expects the Sensex to scale up to the 70,000-mark by December 2022; 80,000 level in a bull-case scenario and hover around the 50,000-mark as a bear-case, the brokerage house said in a report.
Debt-ridden telecom operator Vodafone Idea is evaluating the option of converting interest dues arising out of the deferment of statutory payments into equity, a senior company official said on Monday. The company is also in talks with banks and investors for raising funds and part of the proceeds is likely to be utilised towards meeting obligations related to debt maturing this fiscal, Vodafone Idea Limited (VIL) chief financial officer Akshay Moondra said during the company's earning call. VIL MD and CEO Ravinder Takkar said the company expects to conclude fund raising plan by the end of the current financial year.
'For the next two years, we expect the bulk of earnings growth contribution from sectors like financials and energy, where the outlook remains positive, while the sectors which are linked to domestic consumption and are currently witnessing strains on margins have low salience for Nifty earnings.'
Digital payments and financial services firm Paytm is likely to allocate shares at the upper price band of Rs 2,150 apiece on November 16 after market regulator SEBI's approval which is expected to come on Monday, sources aware of the development said. Earlier the allocation was expected to take place on Monday and the Paytm Money app also displayed the same.
Airports hold pride of place in the government's National Monetisation Pipeline (NMP) programme to monetise public assets. Private airport operators, including the Adani group, Fairfax, GMR and Zurich Airport, are expected to evince interest in the next round of public private partnership (PPP) development of state-owned Airport Authority of India (AAI) airports. Industry analysts, however, do not expect bids to be as high as the last round, which saw Adani group gain control of six airports.
With retail inflation witnessing significant uptick in May, the Reserve Bank of India (RBI) is likely to maintain status quo in its August monetary policy review, according to a report. According to the SBI's research report- Ecowrap, inflation may remain elevated in the coming months due to several global and domestic factors. "We expect a status-quo in August. We believe RBI would still try to find a marriage of convenience of regulatory and developmental measures and monetary policy in August policy," the research report said on Wednesday.
Providing services like broadband connectivity, cable TV, enterprise solutions, and payment wallets is the need of the hour for telcos, and a second wave of consolidation is upon the industry, a rating agency said on Tuesday. India Ratings and Research said the sector, which was battered following the aggressive entry of Reliance Jio, will continue showing signs of recovery amid conducive regulatory environment and maintained a "stable" outlook for the industry in FY22. The second round of consolidation (Consolidation 2.0) is kicking-in in the industry, which will bring a transformation in the business models of telecom companies, leading to the evolution of incumbents from the providers of traditional voice-only services to complete digital solutions for households, it said.
'We expect exports to touch Rs 1,000 crore by the end of the year.'
Many banks' profits will take a hit and a few of them could even end up being in the red because of treasury losses, triggered by a sudden spike in government bond yields in the rising interest rate cycle, notes Tamal Bandyopadhyay.
'It has the potential to add half a trillion dollars to the economy over the next five years.'
The broadening of the market rally sends the signal that growth will be broad-based, observes Akash Prakash.
With the farmers' protest against the three new laws and in support of legalising the minimum support price (MSP) going strong, state governments have announced a slew of measures in their annual Budgets to placate farmers. The Centre kicked things off in the Union Budget by assuring farmers that the MSP would continue and coming out with a report card to demonstrate its commitment. However, these efforts don't seem to have yielded tangible results. In their respective Budgets, states chose to go a step further by announcing a variety of measures.
There has been a stellar rise for the Indian markets this far in calendar year 2021 (CY21) with the S&P BSE Sensex surging over 19 per cent. The gain in mid-and small-cap indices on the BSE has been sharper with both these indexes surging around 38 per cent and 54 per cent, respectively during this period. Rampant spread of Covid pandemic's Delta variant and the ensuing lockdown and mobility curbs across India, rising prices key commodities, including crude oil and its impact on inflation, possibility of tightening of policy stance by major global central banks, especially the US Federal Reserve (US Fed) have been some of the key headwinds that the markets successfully negotiated during this period.
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