Expect heightened volatility and stress to hit the markets. Caution may be the need of the hour, alerts Akash Prakash.
Consensus continues to be cautious with analysts pointing towards tougher days ahead
The startling report comes at a time when many analysts are concerned over almost all the key indicators heading south or even contracting, forcing the government to offer massive tax giveaways.
As regards India, FIIs have pumped in over Rs 34,400 crore in the Indian stocks in calendar year 2021.
Vedanta Limited (Vedanta) helping its parent and group holding company Vedanta Resources to deleverage its balance sheet has started to strain its balance sheet. Vedanta's gross debt (consolidated) was up 24.3 per cent year-on-year (YoY) in FY23 and reached a six-year high of Rs 66,628 crore by the end of March. Similarly, its net debt went up 20.3 per cent YoY to Rs 45,706 crore at the end of FY23, up from Rs 38,228 crore a year ago; it was the highest since FY20.
SBI remains a favourite of most brokerages in the PSB segment.
The rubber and tourism industries in the state, to which the bank has exposure, have been hit.
Valued at $71.2 billion, the bank's market capitalisation is more than that of global banks like Barclays, JP Morgan Chase and Credit Suisse.
The bull run in the Indian equity markets is intact, said analysts at Morgan Stanley in a recent note. They expect the S&P BSE Sensex to hit 80,000 levels by December 2023 in their bull-case scenario, to which they have assigned a 30 per cent probability. From the current level, this translates into an upside of nearly 29 per cent.
Companies with contrasting financial ratios enjoy similar credit ratings; agencies say they look at many other metrics.
Experts say a combination of improving asset quality and NBFCs' weak balance-sheets bodes well for both corporate and retail banks.
Digitisation is changing the banking business. This shift has resulted in a change in banking job profiles.
ICICI Bank puts up a good show in Q4.
The demand for gold is expected to take a hit if the price of the yellow metal - which has been hovering around Rs 60,000, a level never seen before - remains elevated. Due to a sharp increase in price in a very short time and the flow of smuggled gold continuing, gold price in Mumbai is quoted at around Rs 59,000 per 10 gram. Typically, overall demand in the January-March and July-September quarters is moderate-to-dull, which is the case in the ongoing period.
A section of analysts feel now may not be a bad time to buy select PSBs.
Major gainers in the Sensex pack were Wipro, Kotak Bank, Infosys, Maruti, Tata Motors, L&T, IndusInd Bank, Hero MotoCorp, M&M, SBI, ONGC, HDFC Bank and HUL, rising up to 3 per cent.
Lenders fret over stubbornly weak credit growth and still high funding costs.
So which sectors are likely to do well in 2022? Should you focus on domestic economy-related sectors or export-oriented ones?
The earnings of India Inc hit a record high in the 2022-23 (FY23) January-March quarter (fourth quarter, or Q4), compared with their poor showing in the previous two quarters of the financial year. The rise in earnings, however, is exclusively led by banking, financial services, and insurance (BFSI) companies. A better-than-expected showing by banks and non-bank lenders in Q4FY23 more than compensated for the earnings contraction in the non-BFSI space.
The inflation data for May and the US Fed interest rate decision are the crucial factors that would dictate terms in the equity market this week, analysts said. Moreover, foreign fund trading activity, movement of rupee and crude oil prices would be the other key monitarables for the markets, they added. "All eyes will be on the US FOMC (Federal Open Market Committee) decision scheduled on June 15, and the market is fearing aggressive rate hikes amid inflation monster. "Bank of Japan will also announce its credit policy on June 17.
Anaysts recommend a 'buy' on Icra due to its positive outlook.
Anaysts recommend a 'buy' on Icra due to its positive outlook.
Many of India's sleepy state banks don't have the management capacity they need to tackle bad debts and deals at the same time, says Una Galani.
Meet to review progress on lending, impact of recent rate cuts and what is being done on NPAs, among other things
Only three of India's 45 commercial banks have cut base lending rates since the Reserve Bank of India's surprise easing this month, hurting the government's drive to lift business investment.
Foreign currency loans raised by Indian companies nosedived to $210 million in the September quarter (Q2), 93.3 per cent less than the year-ago period when five firms raised $3.1 billion. The Q2 amount is the lowest since December 2003 quarter when India Inc raised $191 million. Companies cited volatility in the currency markets, sharp rise in interest rates in the United States, and fund availability in India as the main reasons behind the sharp fall.
From zeroing in on the best means for stake dilution to moving beyond microfinance, Bandhan navigates a tough path. Namrata Acharya reports.
Gold prices hit record high in the third week of March as fears of bank collapses and high inflation led investors to the traditional safe haven. Gold prices are often inversely correlated to dollar strength because the international price is dollar-denominated. The Federal Reserve's (Fed's) stance indicates that the dollar may appreciate further since it is prepared to keep pushing up policy rates. But demand for gold is also up - the World Gold Council claims central banks are buying in addition to private demand.
At an aggregate level, the late ace investor's portfolio that was valued at Rs 32,445 crore as on March 31, 2023 is now worth Rs 35,979 crore.
Major global indices like CAC 40, DAX Shanghai Composite, Hang Seng, Nikkei, Straits Times, Sensex, Nifty have lost 1% - 10% in a week
HDFC Bank's 12-month forward price-to-book ratio is estimated to be the highest among 166 large and mid cap banks in Asia Pacific.
It is nearly after 13 years that a foreign brokerage has resumed holistic coverage on stocks of public sector banks (PSBs). To that extent, Morgan Stanley's report dated March 3, where the analysts have listed their order of preference for PSB stocks, is an indication that the state-owned banks may once again be attracting some interest, thanks to three back-to-back quarters of good results in FY21 so far. "State-owned banks' balance sheets have improved, and bad loans formation should moderate going forward," the analysts note and this is the key reason for them to relook at their stance on PSBs. While State Bank of India (SBI) remains their preferred pick, stocks of Bank of Baroda (BOB) and Punjab National Bank (PNB) have been upgraded from 'underweight' to 'equal-weight'. The brokerage maintains its underweight recommendation on Bank of India and Canara Bank.
'The government must find worthwhile private owners for some of the banks, increase the share of private sector banking in the system, and then ask the remaining government banks to face the discipline of the market and compete, or shrink into irrelevance,' says T N Ninan.
India Inc could be embarking upon a new phase of capital expenditure (capex) cycle, observed analysts, and suggest its revival would lead to a rerating of industrial stocks. Assisted by a property upcycle, analysts at Jefferies said several government initiatives were likely to drive capex. Indicators, they said, include a private project announcement at Rs 25 trillion for 2022-23 (up 150 per cent from pre-pandemic levels) and credit growth at about 16 per cent, which is closer to pre-pandemic highs.
10 stocks which are most popular with brokerages right now and are expected to deliver maximum upside over the next 12 months.
Reserve Bank of India Governor Shaktikanta Das tells Anup Roy, Raghu Mohan and Niraj Bhatt that it is time for banks to lower interest rates and start lending to cash-starved finance companies after due credit appraisal and proper risk assessment.
This is part of an 'aggressive and decisive set of action' to shore up the company.
Currently, only three have completed more than six months of operation in the space - Fino Payments Bank, Airtel Payments Bank and Paytm
The ruble has recouped most of its losses and become the top-performing currency globally. It continues to gain and is up 60 per cent against the US dollar from its lows in the first week of March. The ruble appreciated to 83 to the dollar intraday on Tuesday against a record low of 139 on March 7.
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