Despite high exposure of public sector banks to power, iron and steel sectors, analysts remain in a wait-and-watch mode.
The last year has seen public sector undertakings (PSUs) outperforming the Nifty50, albeit by a small degree. But PSU valuations are still, on average, less than half of private sector peers at price-to-equity or PE 8.7x for the Nifty PSU Index versus 20.9x for the Nifty50. There are several reasons for lower valuation.
Despite the large economic impact of the Covid-19 pandemic, the markets have recovered sharply even though the performance among individual stocks has been quite polarised.
Lending rates in certain segments may be increased; fixed depositors may lock into existing rates.
Bad debt rules are steps in right direction.
Chief economic advisor V Anantha Nageswaran on Tuesday said Indian economy will grow at over 7 per cent, down from above 8 per cent of growth rate projected in January. He, however, said that the economic momentum and the animal spirits are "unmistakable". "India's own growth rates have come off the projections made in January down to about 7-plus per cent for the current financial year," Nageswaran said speaking at Global Fintech Fest event in Mumbai.
'If because of El Nino, the monsoon is affected adversely in the current year, naturally it will affect income projections and consequently Budget numbers.'
ICICI Bank, HDFC Bank and Axis Bank reported healthy loan growth and asset quality.
Vedanta group chairman, Anil Agarwal, 69, is well known for his business journey from a scrap dealer from Bihar to a London-based globe-girdling metal and oil and gas conglomerate with revenues of $19 billion. Now his abilities to keep his group from over-leveraging itself will be put to the test. Over the years, Agarwal, now based in London, set up the conglomerate via acquiring iron ore producer Sesa Goa, Cairn's oil producing assets in India, and Electrosteel Steel.
Small- and medium-sized realty firms are scouting for private equity funds to finance forthcoming projects as bank funds have dried up following concerns over high credit growth to the sector.
India's equity markets are on a roller-coaster ride, after delivering spectacular returns for two consecutive years - in 2020 and 2021. The benchmark National Stock Exchange's (NSE's) Nifty50 is down 1.5 per cent in the first nine months of the current calendar year 2022 (CY22) as foreign portfolio investors sold Indian stocks due to rising bond yields in the US and across global markets, including India. The sell-off in the Indian equity markets has, however, not been broad-based and largely limited to sectors facing earnings headwinds from rising interest rates, lower commodity and energy prices, and likely economic recession in advanced economies.
As the clean-up has taken hold, loan growth slipped to 10.7 per cent in the last fiscal
Most of the NBFCs do not take public deposits but that does not mean they cannot create systemic risks. The banking system has at least Rs 57,000 crore exposure to IL&FS. Haven't the banks invested public money in IL&FS papers, asks Tamal Bandyopadhyay.
Over 25,600 cases of banking fraud reported up to December 21, 2017, says Minister RS Prasad.
Analysts say there is still no visibility of earnings improvement.
Banks cannot shirk their responsibility in cases of frauds.
The FTSE 100 is up by about 2 per cent since the start of 2015, although the index is down 6 per cent from a record high of 7,122.74 points reached in April.
India's banks rely on overnight borrowings to fund longer-term lending.
Housing finance major HDFC on Monday reported a 16 per cent growth in standalone net profit to Rs 3,700 crore for the January-March quarter, helped by record loan sales on the back of benign interest rates and the resultant fall in cost of funds along with the near-total repayments that culled provisions and credit costs. For the full year, the company, which is working on a reverse merger with its banking subsidiary, has booked a net profit of Rs 13,742 crore, up from Rs 12,027 crore in FY21, vice-chairman and chief executive Keki Mistry said on Monday in an earnings call with analysts. On a consolidated basis, net profit for the quarter surged 21.6 per cent to Rs 6,892 crore on-year and for the full year it jumped 21 per cent to Rs 22,595 crore, Mistry said and guided towards better days.
In the context of market integrity, the IRAI and RBI should go over the minutes of the LIC and SBI board meetings when the decisions to invest in Adani equity or debt were taken, notes Jaimini Bhagwati, former World Bank treasury professional.
Jain was the architect of Deutsche's investment banking business and placed one of his former trading heads, Alan Cloete, in Hong Kong as co-CEO for Asia Pacific in 2012.
With over Rs 15,000 crore in deposits, its strategy is a hit for now, but the real test will come when it starts lending to retail and corporate customers in a big way
25,600 cases of banking fraud totalling Rs 1.79 billion were reported up to December 2017. 'There is an inherent legacy when it comes to insuring crime.' 'Generally, most banks are uncomfortable in sharing data about employee fraud.'
The engineering and construction (E&C) sector delivered an excellent performance in the last two financial years (FY2021-22 or FY22 and FY23's nine-months) and there's reason to believe that FY24 will also see outperformance. The sector has emerged from the pandemic with stronger balance sheets and more rational cost structures. It has a big order book and it should see new order flows accelerate in FY24.
Pawan Verma contended that PSU banks are influenced to give loans to the people who are not able to repay them.
An obscure Indian bank has been an unlikely beneficiary of Western sanctions against Iran, handling billions of dollars from frozen oil payments that boosted its interest margins, but is now having to prepare itself for life after the windfall.
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Of the 11 licence holders, only eight remain in the fray as concerns about profitability and rising competition are making them think twice before jumping in.
Govt reconstitutes body, says will not interfere in senior PSB appointments
'When growth drops precipitously from 7% to 4.5% in four quarters, it is for all practical purposes a recession' notes T N Ninan.
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The report indicated that price rise will continue being a problem and that inflation, which is restricting the Reserve Bank from loosening its elevated policy rates.
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 finance ministry is not only keen to split the roles of CMD, but also wants to appoint them for a fixed tenure of five years.
Closing banks and restricting the flow of capital can build pressure for a solution as finances get squeezed.
Around 75 per cent, or 372 stocks, that are part of the BSE500 are trading at least 10 per cent below their all-time high levels, despite the index hitting a record high 20,515 points on the BSE in intra-day trade on Wednesday, surpassing its previous high of 20,390 touched in March 12. The index, which accounts for 93 per cent of BSE listed companies' market capitalisation, has gained 8 per cent from its recent low of 18,983, touched on April 19. In comparison, the benchmark S&P BSE Sensex gained 6 per cent over the same period, but is still nearly 4.5 per cent away from its all-time high of 52,517 that it hit on February 16.
The spike at private sector lenders like ICICI Bank and Axis Bank follows a push to grab market share from India's dominant state banks.
Jain, who, landed the top spot at Deutsche in 2012, had to resign following criticism from investors
Payments banks are niche banks set up by the Reserve Bank of India to further the agenda of financial inclusion.
Chinese stock markets have slumped 30 per cent since mid-June.
Reliance-Google's new smartphone has got mixed reviews from analysts and brokerages. The phone pricing is seen unattractive for low-end customers and bundled offers are being viewed as non-disruptive. While this could slow the pace of adoption, it could set the stage for tariff hikes in the industry, feel analysts.
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