Indian economy to grow at 6.1% 2013-14: World BankNEW DELHI:

   World Bank on Tuesday scaled down India's growth forecast to 6.1% for the current fiscal from 7% projected six months ago.

The decline in the growth forecast is largely due to the decline in agriculture sector which is expected to grow at 2% during 2013-14 against the previous estimate of 2.7% despite normal monsoon projection.

However, the multi-lateral funding agency said that India is regaining economic momentum and growth is expected to recover gradually to its high long-term potential. 

 

ARUSI SINGH

PGDM 2ndSem

Shriram Life Insurance expects 29% jump in new business premium

NEW DELHI: Private sector insurer Shriram Life Insurance today said it expects 29 per cent jump in new business premium income and plans to launch four new products by the end of June this year.

"We expect our new business premium income to be around Rs 545 crore by the end of March 2014, an increase of 29 per cent over the last fiscal," Shriram Life Insurance Managing Director Akhila Srinivasan told PTI.

The company ended the 2012-13 fiscal with a 8 per cent growth in new business premium income at Rs 421 crore.

It plans to file with IRDA for 14 new products in the current fiscal. "We plan to come out with four new products in the April-June quarter for which we will be filing with regulator IRDA," she said.

Srinivasan further said the total premium income of Shriram Life Insurance is expected to go up by 28.6 per cent to Rs 795 crore by March 2014, from Rs 618 crore in the previous year.

The company sold 1.54 lakh policies at the end of March 2013.

Shriram Life Insurance, which is a joint venture between Shriram Group and South Africa--based insurance service provider Sanlam, has a strong presence in South India, especially Tamil Nadu and Andhra Pradesh.

"We are expanding our presence across India. We are going to Delhi, Madhya Pradesh, Kolkata, Punjab, Uttar Pradesh, Jharkhand. We hope these areas to give us increase in our premium collection as we aim to achieve financial inclusion across the country," she said.

The paid-up capital of the company stood at Rs 175 crore. In 2011-12 fiscal, the life insurer clocked a pre-tax profit of Rs 67 crore.

ABDUL WAHEED
PGDM 2nd SEM.
IIMT COLLEGE OF MANAGEMENT

Nifty ends above 5,900; HUL rallies 7% on strong results

MUMBAI: The Nifty broke out of its narrow range in afternoon trade on Monday and surged higher to close near 5,900 mark led by gains in FMCG, realty, power and technology sectors.

The 50-share index ended at 5,904.10, up 32.65 points or 0.56 per cent. It touched a high of 5,918.65 and a low of 5,868.80 in trade today.

The Sensex closed at 19,368.22, up 81.50 points or 0.42 per cent. It touched a high of 19,428.94 and a low of 19,284.40 in trade today.

The S&P BSE Midcap Index was up 0.72 per cent and the S&P BSE Smallcap Index was 0.32 per cent higher.

Among the sectoral indices, the S&P BSE FMCG Index was up 2.40 per cent, the S&P BSE Realty Index was 1.60 per cent higher and the S&P Power Index gained 1.52 per cent. The S&P BSE Metal Index was 0.85 per cent lower and the S&P BSE Healthcare Index slipped 0.08 per cent.

Hindustan UnileverBSE 6.98 % (7.23 per cent), Reliance Infrastructure (4.33 per cent), IndusInd BankBSE 4.40 % (3.68 per cent), Hero MotoCorpBSE 3.24 % (3.01 per cent) and Jaiprakash AssociatesBSE 2.66 % (2.80 per cent) were among the top Nifty gainers.

Hero MotoCorp gained on reporting better than expected net profit at Rs 574.23 crore versus Rs 603.59 crore for the same period last year. The company has hiked prices ranging from Rs. 500 to Rs. 1,500 across all models with immediate effect.

Jindal SteelBSE -4.24 % (4 per cent), NMDC (2.29 per cent), Coal India (1.85 per cent), Sun Pharmaceuticals (1.68 per cent) and Ambuja Cements (1.28 per cent) were among the top losers.

Shares of FMCG major Hindustan Unilever surged higher in trade on back of short coverings after its volume growth and margins surprised the street on the upside.

The company reported a net profit of Rs 787 crore, up 14.6 per cent, as compared to a net profit of Rs 686.6 crore in the corresponding quarter, a year ago. Net sales grew to Rs 6370 crore, up 12.5 per cent as compared to Rs 5,660 crore in the corresponding quarter last fiscal.

EBITDA margins grew at 15.25 per cent as compared to 14.72 per cent, year-on-year (y-o-y). The company reported volume growth 6 per cent vs 10 per cent, y-o-y. The street was expecting volume growth of around 4 per cent.

Market breadth was positive on the NSE with 722 gainers against 567 losers.


ABDUL WAHEED
PGDM 2nd SEM.
IIMT COLLEGE OF MANAGEMENT

Sebi may get greater powers to check money-pooling frauds

NEW DELHI: Market regulator Sebi may get greater powers to check money-pooling frauds by various entities across the country, as the government is considering a major overhaul of regulations governing such schemes.

The proposed critical amendments to the securities laws, would also involve the capital markets regulator getting direct powers for attachment of properties, search and seizure of assets and powers to seek information from any entity in relation to its probes against erring persons and entities.

The amendments could be made to a host of regulations, including the Sebi Act, the Securities Contracts (Regulation) Act and the Depositories Act, a senior official said.

As a result, Sebi could be given powers for overall regulation and oversight of all kinds of money-pooling activities and the definition of Collective Investment Schemes would be expanded to include all kinds of activities involving collection of Rs 100 crore or more public money, he added.

While CIS operations already come under Sebi's jurisdiction, many companies try to challenge the regulator's actions taking advantage of loopholes in the existing norms and on the grounds of multiplicity of regulators.

The official said that Sebi has been given assurance by the government that the regulations would be amended soon. While proposals to these effects are being pursued by Sebi for almost four years now, a strong need to push with these changes has been felt in the recent months in the wake of a long-running tussle between Sebi and Sahara group.

The recent developments involving an alleged defrauding of lakhs of investors by West Bengal-based Saradha group and other entities in the state have further underscored the need to change the regulations to give greater powers to Sebi.

Sebi was earlier of the view that a separate regulator should be considered for all kinds of public money-pooling activities by non-listed entities under a separate act.

Alternatively, Sebi has been seeking amendment to the Sebi Act to widen the scope of CIS definition to include all kinds of money collection schemes.

As per the proposed changes, any pooling of funds under an investment scheme involving a collective amount of Rs 100 crore and above should be considered CIS activity, while Sebi would be empowered to specify the parameters for determining as to what constitutes pooling of funds from the public for the purpose of treating them as CIS operations.

Sebi had first proposed an overhaul of securities laws way back in June 2009, but the establishment of Financial Sector Legislative Reforms Commission (FSLRC) later led to the Finance Ministry asking Sebi to pursue only critical changes.

The Commission was asked to rewrite and harmonise the entire set of financial sector laws in the country, including those involving Sebi and the capital markets.

Later in June 2011, Sebi proposed only critical amendments to the securities laws that it felt were necessary and could not wait for the FSLRC recommendations.

The capital markets watchdog again took up the matter with the Centre in November 2012, pursuant to which the Finance Ministry sought some clarifications and a revised set of proposals was sent again by Sebi earlier this year.

In the meantime, FSLRC has submitted its recommendations, but the government has decided to move ahead with Sebi's proposals with regard to critical amendments in the securities laws as various steps suggested by the Commission need more deliberations and might take time, the official said.

The suggestions made by Sebi include powers similar to the Income Tax department for recovery of monetary penalties and setting up of special courts to deal with criminal prosecution for violation of securities laws. The proposals were sent to Finance Ministry for necessary amendments to relevant securities laws, after being discussed by Sebi board.

The amendments have been sought in view of the challenges faced by Sebi in areas such as the recovery and realisation of monetary penalties and regulation of pooling of monies from public by schemes, including those in the nature of collective investments, among others.

ABDUL WAHEED

PGDM 2nd SEM.

IIMT COLLEGE OF MANAGEMENT

finance

test 1

HDFC bank will continue to grow at scorching pace with rural push

HDFC Bank had another strong quarter, reporting a 30% year-on-year growth in net profit, in line with expectations, on the back of high loan growth, strong margins and stable asset quality. But, the stock fell 1.7% in an otherwise flat broader market, due to a lower-than-anticipated sequential growth in non-interest income.

The non-interest income is an important revenue stream for the bank as it contributes 30% to the total revenue. The flat growth in the non-interest segment was due to moderation in fee growth and decline in foreign exchange (forex) income. Fee income, which forms the most important component of this income stream, declined sequentially for the first time in eight years, albeit marginally. Even forex income dropped due to lower volumes.

According to the bank's management, the volumes in its third-party sales are intact, but regulations regarding pricing and seasonal variations have resulted in the decline. This should improve as the market picks up, the management said. For the March quarter, the second-largest private lender clocked higher-than-expected net interest income, or NII, backed by high loan growth and high margins. The high margin of 4.5% was due to a change in the accounting policy, which considers acquisition cost of retail loans as operating expenses.



Earlier, the cost was netted off from the yield on loans. This not only resulted in higher net interest income but also a substantial jump in its operating expenses sequentially. The higher operating expenses also got reflected in its cost-to-income ratio, which inched upwards due to the massive network expansion the bank has undertaken, adding almost 200 branches this quarter.


The slow pick-up in the economy had a bearing on the bank's advances portfolio, with the share of its retail book increasing almost 300 basis points to 57% from a quarter ago. Personal loans, credit cards, gold loans and business banking were the main drivers of this segment. However, the commercial vehicle/commercial equipment (CV/CE) segment saw a sequential decline in growth rate.

ABDUL WAHEED
PGDM 2nd SEM.
IIMT COLLEGE OF MANAGEMENT

Mini Indian Rupee futures launched in Dubai-:

 a bid to further expand the reach of its Indian Rupee product offering, the Dubai Gold and Commodities Exchange (DGCX) has launched a Mini Indian Rupee Futures Contract (DINRM), it has been announced. "The Mini Indian Rupee futures contract has been designed to meet increasing demand

from market participants for a smaller product that allows them to execute trading strategies without making high capital investments." said Gary Anderson, CEO of DGCX. "Developed after close consultations with our Members and market participants, we believe the contract will particularly benefit SMEs, retail players and traders who import into and export from India, as well as others who remit funds to India regularly." The first of its kind to be introduced in the region and outside of India, the mini contract is one-tenth the size of the existing DGCX Indian Rupee futures contract.
The smaller size of the contract will support retail remitters, individual investors and small and medium-sized businesses (SMEs) in cost-effectively managing currency risk exposure to the Indian Rupee, a statement released in Dubai said.
The innovative new contract is priced at Rs. 200,000 per lot compared to Rs. 2 million per lot for the existing regular DGCX Indian Rupee contract.


ARUSI
PGDM 2nd Sem

Govt seeks to raise Rs.5,000 cr through ETFs in fiscal 2014

Move a part of govt’s Rs.40,000 cr divestment plan; Goldman Sachs Asset Management named fund manager

  

India’s ETF industry is small, with gold-based ones being the most common. Photo: Norm Betts/Bloomberg

Updated: Wed, Apr 24 2013. 01 03 AM IST

Mumbai: The government plans to raise at least Rs.5,000 crore through exchange-traded funds (ETFs) as a part of its Rs.40,000 crore divestment plan in the current fiscal, three persons familiar with the plan said. Goldman Sachs Asset Management (India) Pvt. Ltd has been appointed as the fund manager for the ETFs, which will be based on stocks of state-run firms, they said.

ETFs, like stocks, are listed on exchanges. They are liquid, tradable during market hours, and are issued in a dematerialized form. Typically, ETFs do not have entry or exit loads when bought on exchanges.

These instruments, however, attract costs in the form of a bid and ask spread, and brokerage charges.

India’s ETF industry is small, with gold-based ones being the most common. According to the Association of Mutual Funds in India, at the end of March, the total assets under 38 domestic ETF schemes stood at Rs.13,124 crore, with equity-oriented ones contributing only Rs.1,476 crore.

According to the plan, an index based on the shares of central public sector units (PSUs) will first be created. Index schemes will be launched based on this.

Since January, BSE’s PSU index has underperformed the exchange’s benchmark index, the Sensex. The PSU index has lost 6.977% while the Sensex has lost 1.27%. The National Stock Exchange’s PSE (public sector enterprise) index has, however, done better. It has lost 0.56% since January, while the bourse’s Nifty index has lost 1.15%.

Goldman Sachs emerged as the winner of the mandate last week from among about half a dozen contenders in the mutual funds space.

Most of the ETFs in India are managed by Goldman Sachs Asset Management, with Goldman Sachs Nifty ETS (Rs.482.21 crore) and Goldman Sachs Liquid ETS (Rs.576.66 crore) being the two largest equity-oriented ETFs, according to Value Research India Pvt. Ltd, a New-Delhi based mutual funds tracker.

This is the first time the government will raise money through ETFs. Once launched, the PSU ETF will be the largest among all ETFs.

With Rs.3,377.04 crore assets under management, Goldman Sachs’ Gold ETF is the largest now.

  LALIT SHARMA

PGDM 2ND

Axis Bank profit up 22% in March quarter 

 Profit for the quarter rises to Rs1,555 crore as interest and non-interest income increase 

 Axis Bank set aside Rs595 crore as provisions for non-performing assets, higher than the Rs139 crore it set aside in the same period last year and the Rs387 crore in the quarter ended December. Photo: Mint 

                  Mumbai: Axis Bank Ltd’s profit for the March quarter rose 22% to Rs.1,555 crore, boosted by loan demand from individuals even as the lender earned more through fees and trading.

The net profit beat a Bloomberg estimate of Rs.1,431 crore based on a survey of 45 analysts.

Earnings per share rose to Rs.34.19 in the three months ended 31 March from Rs.30.75 a year earlier.

Its annual net profit on a standalone basis rose 22% to Rs.5,179 crore.

Demand for retail loans, mainly from home and car buyers, increased 44% from a year earlier, faster than the 8% rise in loan demand from companies, said Somnath Sengupta, executive director.

“Demand for corporate loans was slow because of low investment as there was little demand for project finance and most of the loans were taken for working capital,” Sengupta said.

As a result of this, Axis Bank’s loan book increased 16%, in line with the banking system. Its peer HDFC Bank Ltd reported a 23% rise in loans which helped it increase fourth-quarter profit by 30%.

Axis Bank is “well poised to take advantage of a pick-up in industry whenever there is an opportunity”, Sengupta said.

In 2012-13, Axis Bank focussed on increasing its exposure to retail loans as a result of which the proportion of such loans increased to 27% of the total loan book in March 2013 from 22% in the year earlier. Axis Bank set aside Rs.595 crore as provisions for non-performing assets (NPAs), higher than the Rs.139 crore set aside in the year-ago quarter and the Rs.387 crore in the quarter ended 31 December.

Sengupta said a Rs.375 crore special contingency fund has been created through the year. “This is for likely NPAs in the near future. We are just being prudent. It’s not in the expectations of any rise in NPAs,” he said.

Net NPAs as a percentage of net advances increased to Rs.704 crore from Rs.473 crore a year ago, or to 0.32% from 0.25% of net advances last year. The bank added Rs.398 crore NPAs during the quarter while Rs.791 crore loans were restructured, taking the total restructured loans to Rs.4,367 crore, 2.2% of its total loans.

Axis Bank’s net interest margin (NIM)—or the difference between interest earned on loans and that spent on deposits—improved to 3.7% from 3.55% in March 2013. The margin was supported by a Rs.5,537 crore share sale in January as it reduced the cost of funds for the lender.

The bank’s so-called other income increased 26% to Rs.2,007 crore from Rs.1,588 crore in the year earlier, boosted by a 63% rise in trading income and 32% gain in income from recovery of bad assets.

No money laundering

Sengupta said the bank’s preliminary inquiry into allegations of money laundering had showed that “there is no evidence of any systematic money laundering within the bank”.

Axis Bank was one of the three banks named in a sting operation by Cobrapost.com showing employees offering high networth customers ways to circumvent tax rules by compromising on so-called know your customer (KYC) norms.

The bank appointed consulting firm KPMG India in March to carry out a forensic inquiry into the allegations and shifted 20 employees to administrative tasks outside branches.

“If there are any suggestions during the investigation to improve our processes we will implement them and action will be taken against the employees if they are found guilty of any wrongdoing,” Sengupta said.

The bank has investigated 12 branches with transactions spanning a year where its employees were shown helping prospective clients evade tax by the news website.

Sengupta said the Reserve Bank of India had already completed its inquiry and internal inquiries by the bank and KPMG will be completed in a “few days time”.

 

 

Touhid Hussain

PGDM 2nd SEM

Jet Airways to sell stake to Etihad for over Rs 2000 crore

NEW DELHI: In a major Foreign Direct Investment ( FDI) move in the aviation sector, Jet AirwaysBSE 4.43 % on Wednesday agreed to sell 27.3 million shares to Etihad Airways. Jet Airways will sell the shares at Rs 754.73 per share. ET Now sources said that the Jet-Etihad transaction stands at around Rs 2000 crore.

In an intimation to the stock exchanges Jet Airways announced that the Board of Directors of the company approved, subject to compliance with applicable laws and regulations and other necessary approvals, the issuance, by way of a preferential allotment 27.3 million equity shares (24% of Jet's equity) of the face value of Rs. 10/- (Rupees Ten only) to Etihad Airways PJSC at a price of not less than Rs. 754.7361607.

The approval of the shareholders for such issuance and allotment will be sought at an Extraordinary General Meeting to be held in this regard, Jet informed the stock exchanges.

The Board of Directors has granted approval for the Company and Etihad PJSC to enter into inter alia, the Investment Agreement in relation to such issuance and allotment and other documents incidental thereto.

The said preferential allotment is subject to various conditions precedent including regulatory approvals.

The number of Jet shares to be alloted to Etihad represents nearly 32 percent of Jet Airways' share capital. The deal, subject to regulators and shareholders approval, would be the first since India relaxed ownership rules in September and allowed foreign carriers to buy up to 49 percent in local carriers, which are battling stiff competition and high operating costs.

Commenting on the deal which is being called a game-changer for the sector, Kapil Kaul of CAPA told ET Now, "The deal will give Jet the capital that it requires right now. Jet will get new financing opportunities."

The deal is on expected lines post regulatory approvals, he added. "This is a game changing deal for the Indian aviation sector," he said.

Since the government relaxed ownership rules and allowed foreign airlines to buy up to 49 per cent stake in Indian airlines, the Abu Dhabi-based carrier has been in talks a stake in Jet. A few weeks ago, Etihad paid Jet $70 million for the latter's three slots at London's Heathrow Airport.

NEELU KUMARI
PGDM 2ND SEM

Axis Bank likely to report 22% rise in Q4 NII

NEW DELHI: Axis BankBSE 0.24 % Ltd is slated to declare its earnings for the quarter ended March 31 on Wednesday. The private sector bank is expected to report a 22.80 per cent YoY rise in its fourth quarter net interest income ( NII) at Rs 2635 crore as against Rs 2146.10 crore reported in the year-ago period, according to an ET Now poll.

The private sector bank is expected to report a 14.8 per cent YoY rise in its fourth quarter net profit at Rs 1466 crore as against Rs 1277.30 crore reported in the year-ago period, according to estimates.

Pre provision profit (PPP) or profit before deducting any provisions is likely to rise by 22.50 per cent on year-on-year basis. PPP is expected to have grown to Rs 2497 crore, up 22.50 per cent YoY, compared to Rs 2037.60 crore reported in the year ago period.

Net interest margins are likely to come stable sequentially. Slippages are likely to rise, but asset quality needs to be watched. Third quarter gross NPAs are likely to come at 1.1 per cent and net NPAs at 0.3 per cent.

Loan growth is likely to come about 18-19 per cent YoY.

ABDUL WAHEED
PGDM 2nd
 

Asian shares seen rising, weak data pressures euro

Euro off two-week lows vs dollar, capped as rate cut eyed; MSCI Asia ex-Japan likely track US stocks higher 

 

Tokyo: Asian shares are set to track global equities higher on Wednesday, but the euro remained under pressure despite a modest recovery after soft German data underscored the still-fragile state of the euro zone economy.

After the bell on Wall Street, Apple shares rose 3.8% after the company reported better-than-expected second-quarter revenue of $43.6 billion, reflecting strong sales of the iPad and iPhone.

According to Westpack bank, 72.8% of the 147 Standard & Poor’s 500 companies reporting so far beat consensus on earnings.

“Equities were underpinned by positive reports on corporate earnings and US housing, some indications of progress in the Italian political arena, and perceptions that economic weakness in Europe may promote a further easing of monetary policy by the European Central Bank,” Barclays Capital said in a research.

The euro was around $1.3000, managing to recover from Tuesday’s two-week low of $1.2973 hit after a survey showed Germany, the euro zone’s largest economy, saw business activity decline in April for the first time in five months. Traders saw it as strengthening the case for the European Central Bank to cut interest rates.

The upside for the single currency was limited given the potential for an ECB rate cut and lingering concerns about the growth outlook in the recession-hit euro-zone.

In Asia, MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.3% on Tuesday after the preliminary or “flash” China HSBC Purchasing Managers’ Index for April fell to 50.5 from 51.6 in March, as a contraction in new export orders pointed to fragile global demand.

The pan-Asian index was likely to be supported on Wednesday, with Australian shares seen opening higher.

Japan’s Nikkei stock average is also expected to open higher in response to the firmness in US equities, as well as a pause in the yen’s firmness.

The dollar was down 0.1% at ¥99.41, struggling to break above the key ¥100 mark due to weak US economic reports, but traders say the upcoming Bank of Japan meeting on Friday may provide an opportunity to clear that symbolic level.

US stocks rallied on Tuesday, recovering from sharp declines sparked by a “bogus” Associated Press tweet about explosions at the White House, shrugging off data showing US manufacturing grew at its most sluggish pace in six months.

European shares posted their biggest one-day gain in seven months.

Earlier in the Asian session on Wednesday, New Zealand’s central bank held its benchmark interest rate at a record low 2.5% for the 17th straight review, reaffirming it expects to be on hold for the rest of the year as the economy picks up and inflation remains tame.

US crude futures were up 0.3% at $89.44 a barrel early on Wednesday.

 

Touhid Hussain

PGDM 2 nd SEM

Preview: Axis Bank likely to report 22% rise in Q4 NIINEW DELHI: Axis BankBSE 0.24 % Ltd is slated to declare its earnings for the quarter ended March 31 on Wednesday. The private sector bank is expected to report a 22.80 per cent YoY rise in its fourth quarter net interest income ( NII) at Rs 2635 crore as against Rs 2146.10 crore reported in the year-ago period, according to an ET Now poll. The private sector bank is expected to report a 14.8 per cent YoY rise in its fourth quarter net profit at Rs 1466 crore as against Rs 1277.30 crore reported in the year-ago period, according to estimates. Pre provision profit (PPP) or profit before deducting any provisions is likely to rise by 22.50 per cent on year-on-year basis. PPP is expected to have grown to Rs 2497 crore, up 22.50 per cent YoY, compared to Rs 2037.60 crore reported in the year ago period. Net interest margins are likely to come stable sequentially. Slippages are likely to rise, but asset quality needs to be watched. Third quarter gross NPAs are likely to come at 1.1 per cent and net NPAs at 0.3 per cent. Loan growth is likely to come about 18-19 per cent YoY.NEW DELHI: Axis BankBSE 0.24 % Ltd is slated to declare its earnings for the quarter ended March 31 on Wednesday. The private sector bank is expected to report a 22.80 per cent YoY rise in its fourth quarter net interest income ( NII) at Rs 2635 crore as against Rs 2146.10 crore reported in the year-ago period, according to an ET Now poll. The private sector bank is expected to report a 14.8 per cent YoY rise in its fourth quarter net profit at Rs 1466 crore as against Rs 1277.30 crore reported in the year-ago period, according to estimates. Pre provision profit (PPP) or profit before deducting any provisions is likely to rise by 22.50 per cent on year-on-year basis. PPP is expected to have grown to Rs 2497 crore, up 22.50 per cent YoY, compared to Rs 2037.60 crore reported in the year ago period. Net interest margins are likely to come stable sequentially. Slippages are likely to rise, but asset quality needs to be watched. Third quarter gross NPAs are likely to come at 1.1 per cent and net NPAs at 0.3 per cent. Loan growth is likely to come about 18-19 per cent YoY.NEW DELHI: Axis BankBSE 0.24 % Ltd is slated to declare its earnings for the quarter ended March 31 on Wednesday. The private sector bank is expected to report a 22.80 per cent YoY rise in its fourth quarter net interest income ( NII) at Rs 2635 crore as against Rs 2146.10 crore reported in the year-ago period, according to an ET Now poll. The private sector bank is expected to report a 14.8 per cent YoY rise in its fourth quarter net profit at Rs 1466 crore as against Rs 1277.30 crore reported in the year-ago period, according to estimates. Pre provision profit (PPP) or profit before deducting any provisions is likely to rise by 22.50 per cent on year-on-year basis. PPP is expected to have grown to Rs 2497 crore, up 22.50 per cent YoY, compared to Rs 2037.60 crore reported in the year ago period. Net interest margins are likely to come stable sequentially. Slippages are likely to rise, but asset quality needs to be watched. Third quarter gross NPAs are likely to come at 1.1 per cent and net NPAs at 0.3 per cent. Loan growth is likely to come about 18-19 per cent YoY.

NEW DELHI: Axis BankBSE 0.24 % Ltd is slated to declare its earnings for the quarter ended March 31 on Wednesday. The private sector bank is expected to report a 22.80 per cent YoY rise in its fourth quarter net interest income ( NII) at Rs 2635 crore as against Rs 2146.10 crore reported in the year-ago period, according to an ET Now poll.

The private sector bank is expected to report a 14.8 per cent YoY rise in its fourth quarter net profit at Rs 1466 crore as against Rs 1277.30 crore reported in the year-ago period, according to estimates.

Pre provision profit (PPP) or profit before deducting any provisions is likely to rise by 22.50 per cent on year-on-year basis. PPP is expected to have grown to Rs 2497 crore, up 22.50 per cent YoY, compared to Rs 2037.60 crore reported in the year ago period.

Net interest margins are likely to come stable sequentially. Slippages are likely to rise, but asset quality needs to be watched. Third quarter gross NPAs are likely to come at 1.1 per cent and net NPAs at 0.3 per cent.

Loan growth is likely to come about 18-19 per cent YoY.

ABDUL WAHEED
PGDM 2nd SEM.
IIMT COLLEGE OF MANAGEMENT

BANKER’S TRUST REALTIME | Four lessons from Sebi-Sahara spat

 What should Sebi do to get to the bottom of Sahara case? 

 

A file photo of Sebi headquarters in Mumbai. Photo: Abhijit Bhatlekar/Mint 

 

                       India’s apex court has once again expressed its unhappiness with Subrata Roy’s Sahara India Pariwar, a Lucknow-based conglomerate that has at least 4,100 establishments in its fold and Rs.1.18 trillion in assets spread across real estate, infrastructure, media, hospitality, sports and finance. “You are manipulating courts,” a Supreme Court bench, consisting of judges K.S. Radhakrishnan and J.S. Khehar, said on Monday in reference to the group approaching different forums for relief in a legal battle with the stock market regulator. The bench wanted to know why Sahara was refunding money directly to investors and not routing it through the Securities and Exchange Board of India (Sebi), as has been directed by the court.

The group claims that Sahara India Real Estate Corp. Ltd (SIRECL) and Sahara Housing Investment Corp. Ltd (SHICL) have already paid back some Rs.19,000 crore to investors who purchased securities sold by the two firms. Instead of providing a list of people who have received their refunds, the group has been filing appeals in various courts. Sebi wants a few directors of these two companies, including Roy, detained for delaying the refunds.

In August 2012, Radhakrishnan and Khehar asked Sahara to pay back Rs.24,000 crore and directed a retired Supreme Court judge, B.N. Agarwal, to oversee the process. Since then, Sebi has been struggling to get the investors’ money back.

What should it do to get to the bottom of the case which, according to Sebi counsel Arvind Datar, keeps getting “curiouser and curiouser”?

First, it can ask Sahara to provide the list of the top 1% or 5% of investors in the bonds sold by SIRECL and SHICL. Typically, the top 1-5% “creamy layer” of investors account for 20-25% of the money invested. This will make life easier for Sebi and also Sahara as it won’t have to send truckloads of documents to the regulator.

Second, Sebi can also look at the concentration of the investor base. If it can locate five geographical pockets, it would become easier to get a fix on the investors as Nandan Nilekani’s Aadhaar unique identity number project can do the rest of the job.

Finally, Sebi could ask Roy from which banks he withdrew the money to pay investors. He may have been paying cash but certainly he cannot keep Rs.19,000 crore in gunny bags at home or in the Sahara offices. In other words, had he indeed paid Rs.19,000 crore to the bond investors, he would have withdrawn that money from the banking system.

Sebi has been following the directives of the Supreme Court diligently but it lacks the acumen to deal with Roy.

How could Roy find himself in such a situation? The Sahara chief refused to give information to Sebi and thought he could get away with it, but now the apex court is seeking the same details from him. Had he provided the information to Sebi, he would not have found himself in such a mess.

It may or may not be the end game for Roy but many lessons can be learnt from the Sebi-Sahara spat.

First, it’s a vindication of the independence of the judiciary. In this case, justice may have been delayed but definitely not denied. The Supreme Court has demonstrated that politicians cannot shield a businessman for ever.

Second, it’s a lesson for the Indian financial system on its loopholes and how any smart entrepreneur can use regulatory arbitraging to his advantage.

Third, if indeed the two Sahara group firms had 30 million investors in their bonds, the Indian financial system can learn lessons in financial inclusion from Roy. The total number of demat accounts in India is about 20 million.

Finally, if Sahara fails to furnish the correct list of investors, the money for which there are no takers will flow into the government’s consolidated fund for investor education. That will deal a blow to Roy’s business model.

Note: Sahara has filed a defamation case in a Patna court against Mint’s editor and some reporters over the newspaper’s coverage of the company’s disputes with Sebi. Mint is contesting the case.

Banker’s Trust Realtime is a frequent blog by Tamal Bandyopadhyay, who writes a popular weekly column Banker’s Trust.

 

Touhid Hussain

PGDM 2nd SEM 

 

HDFC Bank Q4 net up 30 per cent at Rs 1890 crore, meets forecast

MUMBAI, April 23 (Reuters) - HDFC Bank LtdBSE -1.41 %, country's No3 lender by loan value, met forecasts with a 30 per cent rise in quarterly profit on Tuesday led by higher loan growth, fee income and stable asset quality.

Mumbai-based HDFC Bank, which has posted profit growth of more than 30 per cent every year for the last decade, said its net profit rose to Rs 1890 crore ($348.8 million) in the quarter ended March from about Rs 1453 crore a year earlier. Net interest income grew about 21 per cent to Rs 4290 crore.

According to Thomson Reuters I/B/E/S, analysts had expected a net profit of Rs 1887 crore for the bank, which is also listed in New York and competes with bigger local rivals State Bank of India and ICICI Bank.

Asset quality, valued by the market at about $31 billion, was stable with net non-performing loans as a percentage of total assets at 0.2 per cent.

The bank's net interest margin, a key gauge of profitability, is among the highest in the sector at 4.5 per cent compared with 4.4 per cent a year ago.

HDFC Bank Ltd.

BSE

689.40

-9.85(-1.41%)

Vol: 485217 shares traded

NSE

689.00

-9.30(-1.33%)

Vol: 5965690 shares traded

At 2:39 PM, shares in HDFC Bank were trading at 686.80, down 1.78% on the Bombay Stock Exchange.

ABDUL WAHEED
PGDM 2nd SEM.
IIMT COLLEGE OF MANAGEMENT

HDFC bank contravened RBI instructions: Consumer panel 

A branch of HDFC bank here has been slapped with a fine of Rs 2,000 by a consumer forum for contravening RBI instructions by failing to inform one of its customers about the increase in minimum balance to be maintained in his account and deducting charges from him.

The North District Consumer Disputes Redressal Forum said there was deficiency in service on the bank's part and ordered it to refund the minimum balance charges it had deducted from account holder Mahender Kumar Gola.
The forum arrived at the decision as the bank had not shown any proof that it had informed Delhi resident Gola about the change, from Rs 5,000 to Rs 10,000, in average quarterly balance to be maintained in his account.
"Nothing has been produced on record by opposite party (HDFC) as to what were the contents of note/information regarding minimum amount of average quarterly balance (AQB) displayed on any notice board or displayed for notification to the general public."
"Therefore, we come to the conclusion that the bank failed to intimate the complainant about change in AQB.which is certainly deficiency of service and in contravention of the instructions issued by RBI. It straightaway deducted amounts of Rs 723 and Rs 89 from account of the complainant...," a bench presided by Babu Lal said.
Gola in his complaint had said the bank had approached him with an offer to open an account and had assured him that as long as he maintained an AQB of Rs 5,000, no

ADITYA KUMAR SINGH
PGDM 2nd SEM

Indian rupee slips marginally lower in opening trade

The Indian currency is trading at 54.01/02 per dollar versus its previous close of 53.96/97  

 

Dealers say some bunched up inflows may provide support to the Indian rupee. Photo: Priyanka Parashar/Mint  

 

Mumbai: The Indian rupee traded marginally lower on Monday morning after flattish open. The local currency was trading at 54.01/02 per dollar versus its previous close of 53.96/97.

Dealers say some bunched up inflows may provide support to the Indian rupee. The rupee-dollar pair is seen consolidating around 53.85-54.10 levels.

Foreign funds were provisional buyers of Rs.940 crore of stocks on Thursday.

Indian financial markets were closed on Friday for a local holiday.

The equity benchmark Sensex gained in early trades on Monday, up 0.44%.

The yen started the new week under pressure, with the dollar just a whisker away from the elusive 100 level, after the Group of 20 countries stopped short of criticising Japan’s reflationary policies that have sent its currency tumbling.

 

TOUHID HUSSAIN

PGDM 2nd SEM

 

Sensex above 19,100; capital goods, banks lead

MUMBAI: The S&P BSE Sensex was hovering above the 19,1000 mark on Monday as buying activity continued with the positive opening of the European markets. Capital goods, banks, power and metals led the upmove while IT sector remained under pressure following disappointing fourth quarter results by Wipro.

At 02:00 p.m.; the 30-share index was at 19,118.62, up 102.16 points or 0.54 per cent. It touched a high of 19,144.47 and a low of 18,989.78 in trade today.

The Nifty was at 5,821.15, up 38.05 points or 0.66 per cent. It touched a high of 5,833.45 and a low of 5,789.80 in trade today.

The S&P BSE Midcap Index was up 0.86 per cent and the S&P BSE Smallcap Index gained 0.56 per cent.

Among the sectoral indices, the S&P BSE Capital Goods Index was up 2.14 per cent, the S&P BSE Bankex was 2.06 per cent higher, the S&P BSE Power Index was up 1.47 per cent and the S&P BSE Metal Index gained 1.37 per cent. The S&P BSE IT Index was down 2.39 per cent.

Coal India (3.93 per cent), HDFC BankBSE 3.85 % (3.80 per cent), Larsen & Toubro (2.83 per cent), BHELBSE 3.04 % (2.34 per cent) and NTPCBSE 2.02 % (2.06 per cent) were among the top Sensex gainers.

WiproBSE -7.95 % (8.59 per cent), InfosysBSE -2.22 % (2.41 per cent), Bajaj AutoBSE -1.67 % (2.20 per cent), Dr Reddy's Laboratories (2.17 per cent) and ONGC (1.63 per cent) were among the top index losers.

Jefferies has lowered its price target on Wipro to Rs 405 from Rs 500 earlier based on 14x Mar'15E EPS. This is within the ~12-22x band at which the stock has traded over the past three years, the brokerage says.

Market breadth was positive on the BSE with 1217 gainers against 984 losers.

Foreign institutional investors bought shares worth Rs 940.07 crore while domestic institutional investors sold equities worth Rs 405.22 crore on Thursday as per the provisional data from the National Stock Exchange.

European markets opened on a positive note after profit booking last week. The FTSE 100 was up 0.59 per cent, the CAC 40 was 0.37 per cent higher and the DAX gained 0.62 per cent.

ABDUL WAHEED
PGDM 2nd
IIMT COLLEGE OF MANAGEMENT

Wipro shares fall 11% after weak sales forecast

Wipro joins Infosys in delivering tepid revenue outlook, citing tough macroeconomic conditions

Wipro’s shares plunged 9.36% to Rs.334.15 at 11.04am on Monday on BSE. The exchange’s benchmark index rose 0.11% to 19,037.06. Photo: Pradeep Gaur/Mint

Bangalore: Shares of India’s third-largest software services provider Wipro Ltd fell as much as 11.02% in early morning trade on Monday, after the company gave a weaker-than-expected sales forecast for the June quarter.

On Friday, Wipro posted a profit that beat market expectations, but disappointed investors with a weak revenue forecast for the first quarter of fiscal 2014, raising concerns over whether the turnaround plan overseen by chief executive T.K. Kurien was working. Earlier in April, larger rival Infosys Ltd also disappointed market expectations by giving an annual revenue growth forecast of 6-10%, citing tough macroeconomic conditions. The forecast was less than industry lobby Nasscom’s prediction of 12-14% growth for software exports revenue in fiscal 2014.

Wipro has forecast revenue in the range of $1.57-1.61 billion for the quarter ending June. A poor March 2013 top-line (revenue) report and a soft June 2013 dollar-revenue growth guidance of (0.6)-1.6% quarter-on-quarter indicates Wipro’s turnaround is still quite some time away. Such a weak start to the year yet again implies much of the onus of delivering revenue upsides will fall on 2HFY14, visibility for which remains very low,” CLSA analysts Nimish Joshi and Arati Mishra said in a note to clients.

The weak forecast from Wipro and Infosys was in sharp contrast to Tata Consultancy Services Ltd’s outlook after its earnings last week. TCS said it would exceed Nasscom’s growth forecast for the year. Last week, HCL Technologies Ltd also posted strong earnings and gave a positive outlook for the year ahead.

Wipro’s shares plunged 9.36% to Rs.334.15 at 11.04am on Monday on BSE. The exchange’s benchmark index rose 0.11% to 19,037.06

 

 

PRIYA

PGDM 2nd Sem

Action against ICICI Bank, HDFC Bank, Axis on basis of RBI report: Finmin

The government today said action would be taken against ICICI Bank, HDFC Bank and Axis Bank on the basis of an RBI audit report which has detected certain "aberrations", a month after the private banks were accused of money laundering by an online news portal. "An audit report has come and now the banks would probably be asked for their versions...We don't need to recommend anything; we discussed the issue and everybody will do whatever one is supposed to do after that. The RBI would be doing what they are required to do," Banking Secretary Rajiv Takru told reporters outside the Mint Road office of RBI.
"I think it would be safe to say that there are actionable points where RBI would need to take some action and consequently government would also need to address them," he said.
Last week, Reserve Bank Deputy Governor H R Khan had said the central bank is initiating action against these banks.
"Actions are on the way. Scrutiny has been done, actions is being taken both in respect of systemic level and at the individual banks," he had said.
"Actions are being initiated both at the system level and the individual bank level," he had said.
The banking secretary said that he has received RBI's interim audit report on the allegations levelled in the sting operation by news portal Cobrapost.
However, Takru said he was not at the RBI to recommend specific actions in the regard.
The country's three largest private banks -- ICICI

bank, HDFC Bank and Axis Bank -- were last month accused by Cobrapost of indulging in money laundering activities. Takru said RBI audit report has found certain "aberrations" at ICICI Bank, HDFC Bank and Axis Bank.
"There is no risk of systemic failure. There are certain aberrations which we have discovered in the audit report.
These would be addressed both in terms of systemic factors as well as individual cases," Takur said.
"Whatever responsibilities would have to be fixed will be fixed and whatever rectifications have to be done would be done," he added.
The expose had led to worries over the non-compliance of know your customer norms and also raised concerns if this was a systemic problem.
All the three banks had initiated their internal inquiries and forensic audits, while two of them have also suspended nearly 40-odd people directly concerned pending inquiries.
When asked about the time-line by when the regulatory action can be expected in the regard, Takru suggested that one should not rush and action will be taken only after due considerations and hearing of all sides.
"There is absolutely no tearing hurry to run into some kind of hasty decision-making and in the process do something foolish. So, all concerned will be required to apply their minds, all concerned will be given a complete opportunity to explain. (and then) what is correct and appropriate would be done," he said. Earlier in the day, the secretary attended a board meeting of the country's largest lender SBI.

ABDUL WAHEED
PGDM 2nd SEM
IIMT COLLEGE OF MANAGEMENT

Over-reliance on a single currency for global trade is dangerous: D Subbarao, RBI governor

 

MUMBAI: The Reserve Bank of India governor, Duvvuri Subbarao, said the attempts by central banks of emerging markets to defend a sliding currency are akin to catching a falling knife, and the global financial system may be best served by more than one reserve currency.

Depleting the reserves arsenal at a time of weakness will leave the central banks exposed and failure to defend it against the market tide will cause more harm than good, he said.

"When you are fighting currency depreciation, you are intervening in a hard currency. Your capacity to intervene is, therefore, limited by the size of your forex reserves," Subbarao said at the International Monetary Fund Conference in Washington.

"What complicates the dilemma is that the market is aware of this. It should also be clear that a failed defence of the exchange rate is worse than no defence. So, when you are intervening in the forex market, it is important to make sure that your intervention is successful."

The Indian corporate lobby criticised the RBI for its limited intervention in 2011 when the currency was pummelled.

Although the central bank took some harsh measures to curb speculation, its approach was to make minimal intervention in the market as it believed the reserves were limited.

RBI's stated goal on currency is that it will intervene only to smoothen the volatility and not target a level. On Thursday, the rupee ended 0.4% higher at 53.97 to the US dollar.

India's foreign exchange reserves, which crossed $300 billion before the 2008 credit crisis, have been weakening ever since. Indeed, the nation's vulnerability has worsened with overseas borrowing climbing substantially in the last five years as companies took advantage of low interest rates overseas.

"There is the real danger that by intervening in the forex market, you could end up losing forex reserves and not gain on the currency," said Subbarao. "The lower your reserves dip, the more vulnerable you become. And the vulnerability can become quite serious if your reserves go below the level markets perceive as necessary to regain market access."

The foreign exchange reserves have fallen to about $290 billion, just enough to fund about 6-8 months' imports; in May 2008, there were enough reserves to fund 15 months imports.

Over the past decade, India has had to intervene whenever the currency has appreciated or depreciated.

RBI was defending a strong currency for most part of the last decade when it was seen piling up huge reserves. Subbarao said though central banks have succeeded in preventing a total collapse of the global financial system through their synchronised action, the fault lines have not vanished.

The over-reliance on a single currency for global trade is keeping the system at risk, he said. "The crisis has illustrated the threat to global stability because of a single reserve currency," said Subbarao. "Till alternatives to the single reserve currency emerge, what are the obligations of the US as the issuer of the sole reserve currency? In particular, what are its obligations to EMEs whose currencies are not yet fully convertible on the capital account?" 

TOUHID HUSSAIN

PGDM 2nd SEM

Federal Bank launches Rupay Brand Debit card

Rupay is the card scheme launched by the National Payment Corporation of India to offer a domestic, open loop, multilateral system which will allow all Indian banks and financial institutions in India to participate in the electronic payments market 

Federal Bank launches Rupay Brand Debit card

India Infoline News Service Apr 18, 2013

Rupay is the card scheme launched by the National Payment Corporation of India to offer a domestic, open loop, multilateral system which will allow all Indian banks and financial institutions in India to participate in the electronic payments market

Federal Bank reduces base rate by 25 basis points to 10.20%

India Infoline News Service Feb 21, 2013

The cut will become effective from February 21, 2013.

Federal Bank revises Interest rates on Foreign Currency Deposits

India Infoline News Service Feb 04, 2013

For Japanese Yen, the rates stand increased for maturities between 3 years and 5 years.

Comments of Federal Bank on RBI’s Monetary Policy

India Infoline News Service Jan 29, 2013

With investor sentiment slowly turning positive amidst stagnant growth, India is going through an extended slow down in Industry and trade during the last many months with GDP growth rate at a ten year low.

Federal Bank comments on RBI Monetary Policy

India Infoline News Service Jan 29, 2013

Today’s rate cuts make India become the first major Asian economy to ease borrowing costs in 2013.

Federal Bank & Manipal Global Education launches Federal Manipal School of Banking

India Infoline News Service Jan 21, 2013

The Federal Manipal School of Banking is a fully residential campus offering a one-year ( nine months of intensive campus training and three month internship at a branch of Federal Bank) full time program on various areas of Banking and Management disciplines which is coupled with intensive grooming and soft skills training.

Federal Bank Q3 net profit at Rs2107.80 mn

India Infoline News Service Jan 17, 2013

Total Income has increased from Rs. 16047.60 million for the quarter ended December 31, 2011 to Rs. 17256.20 million for the quarter ended December 31, 2012.

Federal Bank appoints Sureshkumar as Non-Executive Chairman

India Infoline News Service Jan 08, 2013

Federal Bank appoints Suresh Kumar as Non Executive Chairman

India Infoline News Service Jan 07, 2013

Federal Bank appoints Suresh Kumar as the Non Executive Chairman and Dr K M Chandrasekhar as an Additional Director

Federal Bank grants 24,05,725 shares under ESOS 2010

India Infoline News Service Dec 28, 2012

The unique feature of the Scheme is that it covers all permanent employees of the Bank, which means from the junior most award staff till the Managing Director get an opportunity to own the Banks stock

Federal Bank revises interest rates on resident and NRI deposits

India Infoline News Service Dec 24, 2012

The bank has increased rate to 9.00% on maturity period of one year to three years

Federal Bank staff strength crosses 10,000 mark

India Infoline News Service Dec 17, 2012

General Manager, Jolly Antony and the Chief Human Resource Officer, Radhakrishnan Nair expressed confidence that the unity of the 10,000 strong ‘Federal Family’ can and will carry the institution through the difficulties that can test the limits of their courage and determination in future.

Federal Bank launches “House Warming Loan”

India Infoline News Service Nov 05, 2012

The loan is offered at an attractive rate of 2% over the housing loan rate. The quantum of loan can be upto 5% of the Housing Loan limit with a maximum of Rs 2.00 Lakh.

Federal Bank comments on RBI policy

India Infoline News Service Oct 30, 2012

CRR cut of 25 bps would release Rs 17,500 crores in the system.

Federal Bank Q2 net profit at Rs2.15bn

India Infoline News Service Oct 22, 2012

The Bank also improved its half yearly profit numbers with Net Profit of Rs405.45 Crore during H1 of FY 2012-13 as against Rs337.32 Crore during H1 of FY 2011-12, registering growth of 20%.

Federal Bank comments on RBI mid-quarter policy

India Infoline News Service Sep 17, 2012

These moves will improve the confidence of investors. Holding Repo rates constant suggest that RBI is yet vary of high inflation, which may peak before it starts trending down.

Federal Bank declines on block deal

India Infoline News Service Aug 28, 2012

Shares of Federal Bank closed at Rs. 401.90, down 3% over the previous close.

Federal Bank signs MoU with Manipal Global Education Services

India Infoline News Service Aug 24, 2012

The program includes nine months of intensive campus training and three month internship at a branch of Federal Bank. The first batch will commence in November 2012.

Federal Bank Q1 net profit at Rs1903.50 mn

India Infoline News Service Aug 02, 2012

Total Income has increased from Rs. 13616.10 mn for the quarter ended June 30, 2011 to Rs. 16610.40 million for the quarter ended June 30, 2012.

Federal Bank ties up with Samba Bank

India Infoline News Service Jul 04, 2012

Under the arrangement, remittances received through Samba under “SpeedCash Now” can be encashed by the beneficiaries in cash from any of the Federal Bank branches upto Rs. 50,000 per remittance
surya prakash
pgdm 2nd sem

top reality options to invest in near metro citiesBuy a home for yourself this year.

Buy a home for yourself this year. That's the message of Union Budget 2013-14. The Budget has announced an additional tax deduction of Rs 1 lakh for those taking a loan up to Rs 25 lakh to buy their first home this financial year.

If you find the bait attractive enough, the Rs 25-lakh loan cap and high property prices mean you have limited options if you cannot make a big down-payment. One option is buying a house at places not far from metro cities where prices are on the lower side. Even if you don't want to move away from the main city, the high returns that some of these new locations promise means the house can be used as a bridge to the one that you want to live in.

THE ALTERNATIVES

With improving connectivity, expanding cities and rising property prices, more and more home buyers are looking at places close to metro cities. Developers are also betting big on such locations.

Some emerging locations are Manesar (Haryana), Neemrana (Rajasthan), Narela (Delhi), Dharuhera (Haryana), Bhiwadi (Rajasthan), Yelahanka (Karnataka) and Ranjanapada (Maharashtra). Knight Frank India, a property consultancy, listed Manesar, Neemrana, Narela, Yelahanka and Ranjanapada as "hidden gems" in a report released towards the end of last year.

"Buying property in a location that is well-connected and an upcoming industrial hub is apt not only from the end-user point of view but also from the investment point of view," says PS Jayakumar, managing director of Value and Budget Housing Corporation (VBHC), a Bangalorebased developer with focus on low-cost homes.

"The Delhi-National Capital Region (Delhi-NCR) should be a good bet, but buyers need to be aware of two situations-one, economic development in the area and, two, rise in inventory with a large number of new properties getting ready," says Ankur Gupta, joint managing director of Delhi-based Ashiana Housing.

To attract both investors and first-time buyers, developers are offering properties in a number of destinations close to metro cities. Some of these are likely to give good returns over the years .

Avinash kumar
PGDM 2nd sem.

India’s exports rise in March; trade deficit at $10.4 bn

For the financial year ended 31 March, exports contracted 1.76% to $300.6 billion

Exports grew 6.97% to $30.8 billion while imports fell 2.87% to $41.2 billion, leaving a trade deficit of $10.4 billion. Photo

Updated: Thu, Apr 18 2013. 03 28 PM IST

New Delhi: India’s exports grew in March while imports contracted, but the country was still left with a hefty trade deficit, according to figures released on Thursday.

Exports grew 6.97% to $30.8 billion while imports fell 2.87% to $41.2 billion, leaving a trade deficit of $10.4 billion.

For the financial year ended 31 March, exports contracted 1.76% to $300.6 billion while imports grew 0.44% to $491.2 billion, leading to a trade deficit of $190.9 billion.

 

PREETI CHAUHAN

PGDM 2sem

Honda aims to sell 50,000 units of Amaze in FY'14 

apanese auto major Honda plans to sell around 50,000 units of its sedan 'Amaze' in the current fiscal in India and launch five models in the country over the next three years, a senior company official said today.

Honda Cars India Ltd (HCIL) would be able to manufacture only 4,000-5,000 units of Amaze per month this year as its limited by the current production capacity, company's Senior Vice-President (Sales & Marketing) Jnaneswar Sen said at the car's launch in the city.
"Our current plan is to make 4,000-5,000 cars (Amaze) a month. Our capacity is 1.2 lakh units which include all our models. What's available for this model is 4,000-5,000 units a month," Sen said, adding: "We are limited by capacity as of now".
The company hopes to sell "roughly" 50,000 units of 'Amaze', which marks its foray into the diesel segment, in India in the current financial year, he said.
Honda launched its much-awaited entry level sedan Amaze in New Delhi at a price range of Rs 4.99 lakh to Rs 7.60 lakh (ex-showroom, Delhi) on April 11.
The model is the company's first diesel offering in India. Its wholly-owned arm Honda Cars India Ltd (HCIL) is offering the car in petrol option as well.
While the diesel option will be priced between Rs 5.99 and Rs 7.60 lakh, the petrol version will be available at a price range of Rs 4.99 lakh to Rs 7.50 lakh.
Prices for both the variants are as per the company's
surya prakash
PGDM 2ND SEM

Tumbling global gold price eats into RBI’s forex reserves

Value of RBI’s gold reserves has declined from $34.08 bn in September 2011 to $24.17 bn early this week

On Wednesday, the gold price rose 1.32% to $1,386 per ounce. At this price, RBI’s gold reserves are valued at $24.85 billion, down 27.08% from its September 2011 peak.

Mumbai: The value of gold reserves with the Reserve Bank of India (RBI) has dropped 29% after international gold prices crashed last week following speculation that Cyprus may sell its gold reserves to rein in its ballooning fiscal deficit.

The value of RBI’s gold reserves—557.75 tonnes—declined from $34.08 billion (around Rs.1.84 trillion today) in September 2011, when the international gold price peaked at $1,900.23 per ounce (28.35 gram), to $24.17 billion early this week, when the yellow metal tumbled to its 26-month low of $1,347.95 per ounce.

Economists and analysts are playing down the impact of this on the Indian central bank’s reserves as the decline in value is notional. In fact, RBI has made substantial gains from the acquisition of gold reserves in the last one decade, they said.

“Looking at the average cost of acquisition of RBI’s gold holdings, gold has brought significant gains to it as the prices have gone up in the last decade. The current loss is only notional,” said Gaurav Kapur, India economist at Royal Bank of Scotland NV.

On Wednesday, the gold price rose 1.32% to $1,386 per ounce. At this price, RBI’s gold reserves are valued at $24.85 billion, down 27.08% from its September 2011 peak.

Last week, the European Commission said Cyprus may have to sell gold worth about €400 million (Rs.2,840 crore) to rein in its fiscal deficit. If the 13.9 tonnes sale takes place, this will arguably be the largest such disposal by a euro zone central bank since France sold 17.4 tonnes in the first half of 2009.

Gold as a percentage of RBI’s total reserves has been declining since the mid-1990s. It constituted 20% of the reserves in 1994, but dropped to 2.98.% by end-September 2008. RBI then bought 200 tonnes of gold from the International Monetary Fund (IMF) in November 2009, following which the share of the metal in the total reserves rose above 8%.

The 2009 gold purchase from IMF was seen as part of efforts by global central banks such as those of China, Russia, India and some European Union nations to shore up gold reserves and safeguard the reserve position of their economies in the event of a financial crisis. The objective was also to diversify assets.

Traditionally, RBI values its gold reserves at the end of the month at 90% of the daily average price quoted on the London Metal Exchange.

Apart from gold, RBI’s foreign exchange (forex) reserves include foreign currency assets, special drawing rights, and reserves held with IMF. Foreign currency assets consist of sovereign bonds, mainly US treasury bills. Buying more gold will help the Indian central bank diversify its assets. RBI’s gold holdings include the acquisition of gold worth $191 million from the government in 1991-92, $29.4 million in 1992-93, $139.3 million in 1993-94, $315 million in 1994-95 and $17.9 million in 1995-96.

On the other hand, the Indian government has been buying back gold from RBI to meet its own repayment needs. For instance, the government bought back 1.27 tonnes of gold in 1997 and 38.96 tonnes in 1998 from RBI to meet redemption obligations under a gold bond scheme.

Globally, central banks are among the biggest losers in the latest price crash as they own 31,694.8 tonnes, or 19%, of all the gold mined, according to the World Gold Council (WGC) in London. Sliding gold prices have eroded $560 billion from the value of central bank reserves, Bloomberg reported on Wednesday.

Around $773 billion was wiped from the value of all gold holdings globally on 15 April, taking them to around $7.5 trillion from $8.3 trillion last week, based on futures and a 2011 estimate by WGC that 171,300 tonnes of the metal have been mined.

The amount erased is greater than the market capitalization of all the stocks trading in Singapore, according to data compiled by Bloomberg.

In 1991, the Indian central bank had to pledge 67 tonnes of gold to Union Bank of Switzerland and the Bank of England to raise $605 million to shore up its dwindling forex reserves, when the country faced its worst ever balance of payments crisis. India’s forex reserves had declined to a mere $1.2 billion in January 1991. Currently, India’s forex reserves are at $293 billion.

PRIYA
PGDM 2nd Sem