Indian stock markets saw a significant recovery on Tuesday, with both the Sensex and Nifty surging by over 1.25 per cent during the early trading hours. The Nifty 50 index surged by more than 300 points, reaching 23,770, while the Sensex jumped over 1,000 points, climbing to 78,410, at the time of reporting. Market experts have attributed this rally to positive global cues and an oversold market condition. However, they have also cautioned that several underlying challenges for Indian stocks remain, which could affect the sustainability of the rally. These challenges include persistent foreign portfolio investor (FPI) selling, albeit at a reduced pace, downgrades in corporate earnings, slower economic growth, and high real interest rates, all of which are dampening growth prospects. Ajay Bagga, a banking and market expert, noted, "Positive global cues and a heavily oversold market are seeing a 1 per cent to 1.5 per cent bounce in the Indian markets today. The causes of the downtrend in Indian stocks are still very much present... FPI selling (though at a reducing intensity), downgrades to corporate earnings, slower economic growth and high real interest rates are proving a drag on growth impulses. Today's bounce in the Indian markets should be seen as a recovery from oversold levels." Experts have also pointed out that technical indicators suggest further potential gains. The Nifty's rally could extend if it manages to close above the lower Bollinger Band, which is currently situated near 23,490. Akshay Chinchalkar, Head of Research at Axis Securities, explained, "The Nifty's 300-point rally has the potential to extend, particularly given the strength of the recent downtrend. If the Nifty closes above the lower Bollinger Band today – currently near 23,490 – it would trigger a 'Bollinger outside inside' signal. This pattern typically occurs when the price closes below the band on the previous day, followed by a close above it. If this happens, the next logical upside target would be the 20-day moving average, which currently sits near 24,125. Support in the 23,200-23,300 area remains critical on the downside." Despite the recovery, experts have stressed that this should not be mistaken as the start of a bullish trend. FPI selling is likely to continue, and while domestic investors with available funds may find opportunities in stocks that have corrected sharply, the overall sentiment remains cautious. Shriram Subramanian, Founder and Managing Director of InGovern Research Services, added, "The markets are showing initial signs of recovery. FIIs will likely continue to sell, but domestic investors sitting on cash may find value in stocks that have been significantly corrected and are available at reasonable valuations. However, this bounce does not signal a bullish market." Market sentiment could further improve depending on the outcome of the Maharashtra state election results. If the Nifty manages to close above the 24,000 mark, it could signal a more sustained upward movement. Vijay Chopra, a market expert, stated, "Markets were oversold, and this bounce was long overdue. The markets bounced back from the 200-day moving average. If the Maharashtra election results are positive, the markets could resume their upward trajectory. It is essential that the market closes above 24,000 for a sustained rise. This could also mark the beginning of the Santa rally, which typically lasts until December." In summary, while the markets have shown signs of recovery, experts remain cautious about the sustainability of this bounce amidst ongoing macroeconomic challenges. (With inputs from ANI)
19 November,2024 01:03 PM IST | MumbaiThe government is poised to surpass the direct tax collection target of Rs 22.07 lakh crore set for the current fiscal year, according to Central Board of Direct Taxes (CBDT) Chairman Ravi Agarwal. Speaking on Monday, Agarwal expressed confidence in exceeding the ambitious target based on robust collections from both corporate and non-corporate taxes. As per PTI, the CBDT chairman also reminded taxpayers who have not disclosed their foreign income or assets in their Income Tax Returns (ITRs) that they have until 31 December to file revised returns for the 2023-24 fiscal year. To encourage compliance, the tax department is reaching out via SMS and email to individuals identified as holding high-value assets but failing to report them. Inaugurating the Taxpayers Lounge at the India International Trade Fair (IITF), Agarwal highlighted the department’s efforts to simplify tax laws. “We have received over 6,000 suggestions for reviewing the income tax law. Our goal is to make the language clear and user-friendly,” he stated. According to PTI, the CBDT’s latest figures reveal that net direct tax collections between April 1 and November 10 grew by 15.41%, reaching Rs 12.11 lakh crore. This amount comprises Rs 5.10 lakh crore from corporate taxes and Rs 6.62 lakh crore from non-corporate taxes, including taxes paid by individuals, Hindu Undivided Families (HUFs), and firms. The collection from Securities Transaction Tax (STT) during this period stood at ₹35,923 crore. The government’s fiscal target includes Rs 10.20 lakh crore from corporate tax collections and Rs 11.87 lakh crore from personal income tax, corporate tax, and other taxes combined. Agarwal added, “Collections have shown consistent growth, reflecting the strength of our tax system and the compliance of taxpayers.” According to PTI, the Taxpayers Lounge at IITF is designed to promote awareness about the tax system and encourage voluntary compliance. It also showcases the Income Tax Department’s initiatives in leveraging technology to make tax filing more accessible and transparent. The government remains optimistic about achieving and surpassing its fiscal goals, demonstrating confidence in both the country’s economic activity and the efficiency of the tax collection system. (With inputs from PTI)
18 November,2024 02:43 PM IST | New DelhiThe Indian rupee is likely to remain under pressure in the short term, trading within a range of 84-84.5 per US dollar, as per a report by Bank of Baroda. The report attributes this temporary weakness in the rupee to two key factors: foreign portfolio investor (FPI) outflows and the strengthening of the US dollar. It stated, “The Indian rupee is likely to remain under pressure in the near term. This is due to two inter-related factors—FPI outflows and dollar strength.” Despite these immediate challenges, the report expressed confidence in the rupee’s prospects over the medium to long term, emphasising that India’s strong macroeconomic fundamentals position the country well to navigate the current scenario. According to ANI, the report highlighted that India is better equipped this time to address capital outflows compared to previous instances. It noted that the country’s external and fiscal deficits are under control, while economic growth remains robust. Additionally, the Reserve Bank of India (RBI) has maintained a healthy foreign exchange reserve exceeding USD 675 billion, which is expected to be deployed strategically to stabilise the domestic currency, according to the report. As per ANI, the recent outflows of FPIs are considered a temporary phenomenon. The report projected a positive turnaround in FY25, forecasting net FPI inflows of USD 20-25 billion during the financial year. On the trade front, the report noted that India’s trade deficit rose in October 2024. However, strong services exports and remittances are likely to help keep the current account deficit (CAD) in check, ANI reported. The report also underlined India’s resilience, citing solid macroeconomic indicators that provide a foundation for stability. While short-term pressures may persist, the medium to long-term outlook for the rupee remains optimistic. In summary, Bank of Baroda’s report, as per ANI, emphasised that India is in a much better position to manage the ongoing currency challenges, supported by robust economic growth, controlled deficits, and strong foreign exchange reserves. (With inputs from PTI)
18 November,2024 08:44 AM IST | New DelhiIndia’s passenger vehicle (PV) market is witnessing a significant shift, as long-standing players like Maruti Suzuki and Hyundai experience a decline in their market share, while new entrants gain traction. A recent report by Jefferies reveals that the combined market share of Maruti Suzuki and Hyundai has fallen to a 12-year low in the first half of fiscal year 2025 (1HFY25). This marks a notable change in the competitive landscape, as consumer preferences evolve and new competitors make headway. The report states, "Market shares of the top 2 OEMs (Maruti and Hyundai) slipping to 12-year lows in 1HFY25 and Mahindra and Toyota climbing to all-time highs." Both Maruti and Hyundai have been dominant players in India’s PV sector for years, but they are now facing increasing competition from other manufacturers, particularly Mahindra & Mahindra (M&M) and Toyota. According to the report, Mahindra's market share has reached a historic high of 12.5 per cent in 1HFY25, fuelled by the growing demand for SUVs, a segment in which Mahindra has consistently introduced new models. Tata Motors, too, has made significant progress, with its market share peaking at 14 per cent in FY23, though it has slightly decreased to 13.3 per cent in the first half of FY25. Despite this, the second quarter proved challenging for the PV industry in India, with wholesale volumes, including exports, registering a 1 per cent year-on-year decline. This suggests that while consumer demand for newer, feature-rich vehicles such as SUVs continues to rise, there are still headwinds for the overall sector. As per the latest sales data from the Society of Indian Automobile Manufacturers (SIAM), passenger car sales in October saw a decline of 17 per cent. However, when considering all passenger vehicles, including buses and autos, total sales in October reached a record high of 393,238 units, marking a 0.9 per cent increase from the previous year. The market dynamics indicate that while Maruti Suzuki and Hyundai’s dominance is waning, the growing popularity of SUVs and the success of brands like Mahindra and Tata Motors suggest a rapidly changing landscape in India's passenger vehicle market, as per ANI. (With inputs from ANI)
15 November,2024 01:28 PM IST | New DelhiReliance Power reported a consolidated net profit of Rs 2,878.15 crore for the July-September quarter of this financial year, according to PTI. This marks a significant improvement from the Rs 237.76 crore net loss it recorded in the same quarter last year, ending 30 September 2023. The company’s latest quarterly performance reflects a notable turnaround, primarily driven by the financial impact of subsidiary deconsolidation. As per PTI, Reliance Power disclosed in a regulatory filing on Tuesday that it realised a substantial gain of Rs 3,230.42 crore following the deconsolidation of one of its subsidiaries. Deconsolidation typically means that the assets, liabilities, and equity of a subsidiary are no longer part of the parent company's consolidated financials, impacting the company’s overall financial standing. In the same quarter, however, the company's total income decreased to Rs 1,962.77 crore, down from Rs 2,116.37 crore in the corresponding period last year. This dip in income came alongside the gains from deconsolidation and restructuring activities, which have been central to Reliance Power’s financial repositioning this year. One of the significant moves by Reliance Power during this period involved settling guarantor obligations totalling Rs 3,872 crore for its subsidiary Vidarbha Industries Power Ltd (VIPL). According to the regulatory filing, the settlement has effectively discharged Reliance Power from all corporate guarantees and related undertakings associated with VIPL’s outstanding debt, totalling Rs 3,872.04 crore (or Rs 3,87,204 lakh). With this development, VIPL ceased to be a Reliance Power subsidiary on 17 September 2024. The company also announced that it had settled all disputes with CFM Asset Reconstruction Private Limited (CFM). Following this settlement, an application filed by CFM under Section 7 of the Insolvency and Bankruptcy Code was withdrawn on 25 September 2024, according to PTI. In accordance with Ind AS 110, which pertains to “Consolidated Financial Statements,” Reliance Power recognised VIPL’s income and expenses in the Group's consolidated financials only up to 17 September 2024. By the end of September, the Group had derecognised its share in VIPL’s net liabilities, resulting in a gain of Rs 3,230.42 crore (or Rs 3,23,042 lakh) as an exceptional item. Reliance Power, a key entity within the Reliance Group, stands as one of India’s foremost private power generation and coal resource companies. With a diverse portfolio that spans coal, gas, hydro, and renewable energy, the company’s operational capacity currently stands at 5,300 megawatts. This latest quarter’s financial results underscore the company’s continued efforts in financial restructuring and consolidation.
13 November,2024 11:11 AM IST | MumbaiA rate cut by the Reserve Bank of India (RBI) is unlikely even in February due to the ongoing inflationary pressures, according to a recent report by SBI Research. The report states that while inflation is expected to ease slightly from January 2025, it will be largely driven by base effects, rather than a significant cooling of underlying price pressures. SBI Research forecasts that inflation will average around 4.8 percent to 4.9 percent in the financial year 2025, which is still above the RBI's target of 4.5 percent. The easing of inflation from January onwards is expected to be gradual, largely owing to base effects from the previous year. This has led the research team to revise its expectations regarding a rate cut in February, with the first rate cut now anticipated to occur later than initially expected. As per the data released by the Ministry of Statistics and Programme Implementation, food inflation in India stood at 10.87 percent in October, with vegetable inflation reaching a staggering 42.18 percent. This has contributed to a sharp rise in overall inflation, with India's retail inflation recorded at 6.21 percent in October, surpassing the RBI's upper tolerance limit of 6 percent. Several states, including Chhattisgarh (8.8 percent), Bihar (7.9 percent), and Odisha (7.5 percent), are experiencing inflation rates higher than the national average, according to the report. The report also highlights a stark disparity between rural and urban inflation, with inflation in rural areas exceeding urban inflation by 1.07 percent. This is primarily due to the higher weight of food items in the rural inflation basket (54.2 percent) compared to the urban basket (36.3 percent), as food prices continue to rise. While the report anticipates some moderation in vegetable prices in November, it suggests that CPI headline inflation may remain above 5 percent for both November and December. Additionally, the volatility in the currency markets could provide the RBI with further justification for not signalling an early rate-cut cycle, with higher inflation potentially serving as a buffer to delay such decisions. Overall, the outlook for inflation and interest rates remains cautious, as the RBI is likely to adopt a wait-and-see approach before making any rate adjustments, especially in light of the ongoing inflationary pressures and market uncertainties, as per the SBI Research report. (With inputs from ANI)
13 November,2024 09:25 AM IST | New DelhiBank of Baroda (BoB) has projected that India's Gross Domestic Product (GDP) growth will reach 6.9% in the second quarter of the fiscal year 2024-2025, surpassing the 6.7% growth rate recorded in the first quarter, according to a recent report. The forecast attributes this uptick in growth to a combination of strong domestic demand and favourable trends in high-frequency economic indicators, as per ANI. The report from BoB states, "On the domestic front, GDP data for Q2 is awaited, and we expect growth at 6.9% versus 6.7% in Q1." According to BoB, the upcoming festive season, which began in September and extended into October, has further boosted demand across various sectors. This rise in consumption is evident in several indicators, including an increase in air passenger volumes and the Services Purchasing Managers’ Index (PMI), which reflects heightened activity in the services sector. Additionally, the report notes an increase in toll collections, vehicle registrations, and non-oil, non-gold imports towards the close of Q2 and the beginning of Q3. These trends suggest greater mobility and consumer activity, demonstrating a broad-based improvement in economic sentiment and consumer confidence. According to ANI, both central and state government expenditures have also contributed to this acceleration, driving growth in public infrastructure and related areas. Digital payments and auto sales have shown a marked recovery as well, aligning with the overall rise in consumption metrics, as stated in the report. Manufacturing and services PMI data indicate balanced growth across sectors, suggesting that both manufacturing and service industries are contributing positively to the economic expansion. The Reserve Bank of India's (RBI) consumer confidence survey conducted in September has shown stable household sentiments, while rural demand has experienced a notable recovery. Two-wheeler and tractor sales, important indicators of rural economic health, have rebounded, signalling positive trends in rural areas. However, BoB’s report also highlights persistent inflationary pressures, with price data for October reflecting elevated levels. This could influence the RBI’s monetary policy in its December meeting. The central bank is likely to keep interest rates steady in response to sustained economic growth, though a potential rate cut may be considered by February 2025, depending on inflation trends. The report also mentions a slight deceleration in credit growth across sectors, a trend that may impact the broader economic momentum in subsequent quarters. Slowing credit growth can lead to reduced investments, which may temper the pace of expansion if it persists. Overall, the report from BoB emphasises that a combination of factors, including festive demand, rising consumer confidence, and positive rural and urban economic indicators, is helping to maintain India’s growth trajectory. With the GDP data for Q2 expected on 29 November, the Ministry of Statistics and Programme Implementation (MoSPI) will soon release official figures to confirm the forecast, according to ANI. According to the BoB report, the economy is positioned for steady growth in the latter half of the fiscal year, bolstered by sustained demand, a robust services sector, and a stable consumption environment across both urban and rural areas.
12 November,2024 12:37 PM IST | New DelhiA report by DSP Asset Managers has highlighted that if the ongoing sell-off by foreign investors is combined with a sharp rise in crude oil prices, India’s Balance of Payments (BoP) could face significant pressure. According to the report, foreign inflows, particularly from Foreign Institutional Investors (FIIs) in the equity markets, are not only key drivers of stock prices but also play a vital role in maintaining macroeconomic stability in India. The report stressed that in the event of a sharp increase in oil prices, coupled with large-scale FII sell-offs, India’s BoP could deteriorate rapidly, which would put a strain on the country’s economic balance. India’s dependency on imported crude oil has been a historical challenge. As noted in the report, crude oil is a crucial input for the nation’s economy, and every time oil prices surpass USD 100 per barrel, India’s merchandise trade deficit expands significantly, putting added pressure on the nation’s economic resilience. However, over the last decade, rising net flows from services exports and remittances have acted as a cushion, offsetting the negative impact of high oil prices on India’s BoP. The report pointed out that despite crude oil reaching USD 100 per barrel, these inflows have been successful in keeping India’s merchandise trade deficit under control. "In years when India faces an oil shock, foreign inflows come to its aid," the report stated. Despite this buffer, India is not immune to external shocks. When oil prices rise unexpectedly, the BoP position becomes fragile, and India has often relied on foreign capital inflows to stabilise its finances. For instance, during the 2013 crisis, the Reserve Bank of India (RBI) launched the USD 34 billion Foreign Currency Non-Resident (FCNR) deposit scheme to attract dollar inflows, providing the country with much-needed support. Similarly, in the financial years 2013, 2018, and 2019, India raised substantial foreign loans to manage deficits. The report warns that if capital inflows were to fall short, it could lead to a currency crisis, forcing the RBI to step in. "When India’s financial and capital accounts are unable to cover the current account deficit, a currency threat looms, which the RBI must manage," it said. As per the report, ensuring a steady flow of foreign investments is crucial for India’s economic stability, especially during times of volatile oil prices and uncertain global capital movements. (With inputs from ANI)
12 November,2024 10:32 AM IST | New DelhiEquity benchmark indices, Sensex and Nifty, showed positive movement in early trade on Tuesday, boosted by value buying at lower levels, sustained investment by domestic institutional investors, and a rally in the US markets. The BSE Sensex surged by 324.83 points, reaching 79,820.98, while the NSE Nifty climbed 100.7 points to 24,242 during early trade. Among the 30 stocks that make up the Sensex, Bharti Airtel, ICICI Bank, Sun Pharma, Axis Bank, Tata Steel, Titan, Reliance Industries, and Power Grid emerged as the biggest gainers. However, Maruti, HDFC Bank, Asian Paints, and IndusInd Bank were among the major laggards. Foreign Institutional Investors (FIIs) had offloaded equities worth Rs 2,306.88 crore on Monday, while Domestic Institutional Investors (DIIs) bought Rs 2,026.63 crore worth of shares, according to exchange data. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, commented that two key factors were influencing the market's current trend. Firstly, the persistent selling by FIIs has been putting pressure on the market, favouring the bears and pulling the market down. Secondly, the sustained buying by DIIs has been providing support, preventing a crash. Vijayakumar further added that the market's performance in the coming days would depend on the relative strength of these two opposing forces. In the Asian markets, Seoul, Tokyo, Shanghai, and Hong Kong were all trading in the negative territory. On the other hand, Wall Street ended higher on Monday, with the S&P 500 crossing the 6,000 milestone and the Dow surging past 44,000. This positive momentum was fuelled by optimism surrounding Donald Trump's election win, the Federal Reserve’s rate cut, and strong consumer sentiment, as noted by Prashanth Tapse, Senior Vice President (Research) at Mehta Equities Ltd. Global oil prices also saw a slight dip, with Brent crude falling by 0.15 per cent to USD 71.72 per barrel. After fluctuating between highs and lows, the BSE Sensex ended Monday’s session with a marginal gain of 9.83 points, or 0.01 per cent, to close at 79,496.15. Meanwhile, the Nifty ended with a minor dip of 6.90 points, or 0.03 per cent, settling at 24,141.30. As per PTI, the mixed performance in the equity markets reflects ongoing market consolidation amid varying investor sentiments. (With inputs from PTI)
12 November,2024 10:20 AM IST | MumbaiThe Indian stock markets are continuing to face pressure from persistent selling by foreign portfolio investors (FPIs). According to data from the National Securities Depository Ltd (NSDL), FPIs have sold equities worth a substantial Rs 19,994 crore in just the first five trading sessions of November, heightening concerns about the stability of the market. The data also reveals that the highest single-day selling occurred last Friday, when foreign investors offloaded shares worth Rs 5,635 crore. This wave of selling has put significant strain on the major Indian indices, with both the Nifty 50 and Sensex dropping by around 8 per cent since the selling spree began in October. In October, FPIs had recorded their highest ever monthly selling, with Rs 1,13,858 crore worth of shares being sold through the exchanges. The sheer volume of this outflow underscores the cautious stance that foreign investors have taken toward Indian equities. However, despite the heavy selling in the secondary market, FPIs have remained active in the primary market, with selective investments in certain sectors and new companies entering the market. In October alone, FPIs invested Rs 19,842 crore in initial public offerings (IPOs) and other primary market opportunities, highlighting their continued interest in specific areas. Experts believe that the volatility could persist in the near term, as foreign investors adjust their portfolios. "The rally in Chinese stocks seems to have slowed, as seen in the recent declines in the Shanghai and Hang Seng indices. Given the high valuations in India, FPIs may continue to sell, which could cap any potential upward movement in the market. Another noteworthy trend is that despite significant FPI selling in financial stocks, the sector has shown resilience due to reasonable valuations, with the selling being absorbed by domestic institutional investors (DIIs) and high-net-worth individuals (HNIs)," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. This ongoing selling by FPIs has introduced an element of uncertainty into the Indian equity markets. Experts are now closely monitoring the situation, looking for signs of stabilisation, as domestic institutional investors strive to counterbalance the outflows. According to ANI, this shift in investor sentiment has raised questions about the market's near-term outlook and its capacity to recover from the recent declines. (With inputs from ANI)
09 November,2024 02:34 PM IST | New DelhiSony Pictures Networks India (SPNI) announced the appointment of Sibaji Biswas as its new Chief Financial Officer (CFO), effective from the first week of January 2025. Biswas will take on the responsibility of leading SPNI’s financial strategy, planning, and corporate finance, with a focus on driving operational efficiency and fostering growth across the company’s multi-channel and digital platforms. As per PTI, Biswas brings with him extensive financial expertise from his previous roles. He had been serving as the CFO and Executive Director at Syngene International, a firm under the Biocon Group. His experience also includes a distinguished 12-year tenure at Vodafone, where he held several key positions, including CFO of Vodafone Romania, Executive Vice President (EVP) of Corporate Development, and Head of Procurement. His varied experience in the financial sector will be crucial to the ongoing growth and efficiency of SPNI. In his new role at SPNI, Biswas will oversee the company’s financial operations, ensuring that SPNI remains competitive in an ever-changing media landscape. His leadership will be instrumental in navigating the company through financial challenges, optimising resource allocation, and ensuring the company's financial health as SPNI continues to expand its reach across India and beyond. Commenting on the appointment, Gaurav Banerjee, Managing Director and CEO of Sony Pictures Networks India, expressed confidence in Biswas’s abilities, stating, "Sibaji’s financial expertise and strategic approach make him a strong fit for SPNI’s leadership team. His experience in building operational efficiency and navigating complex financial landscapes will be invaluable as we strengthen our brand and enhance the viewer experience." According to PTI, Banerjee’s statement highlighted the importance of Biswas’s leadership in steering SPNI towards greater success in the competitive entertainment industry. The appointment comes at a crucial time as SPNI looks to grow its portfolio across both traditional television and digital platforms, striving to deliver content that resonates with a wide range of audiences. With a solid financial strategy in place, the company is looking forward to continued success in the years ahead. As per PTI, this change in leadership will ensure that SPNI is well-positioned to navigate the challenges of a rapidly evolving media sector, delivering both financial stability and growth. (With inputs from PTI)
08 November,2024 02:26 PM IST | MumbaiADVERTISEMENT
