Sensex trades over 90 points higher on positive global cues

At 9.29am, the Sensex was trading up 0.44%, or 92.16 points, at 20,903.6 points. Photo: Hemant Mishra/Mint

Mumbai: The 30-share bellwether BSE Sensex on Tuesday was trading over 90 points higher tracking gains in global markets.

At 9.29am, the Sensex was trading up 0.44%, or 92.16 points, at 20,903.6 points, while the National Stock Exchange’s (NSE’s) broader 50-share Nifty was trading higher 0.48%, or 29.7 points, at 6,215.8 points.

The gainers included Bharti Airtel Ltd that rose 1.18% to Rs.286.25 and ICICI Bank Ltd that jumped 1.14% to Rs.1,048.

Among the losers, Dr Reddy’s Laboratories Ltd shares lost 0.45% to Rs.2,782.5 and Maruti Suzuki India Ltd fell 0.09% to Rs.1,681.90.

All sectoral indices are in green. The BSE Bankex index rose 0.72% to be the biggest gainer, while the S&P BSE consumer durable index rose 0.6%.

Financial Technologies (India) Ltd (FTIL) was trading at Rs.329.4 on BSE, up 2.08% from its previous close, while Multi Commodity Exchange of India Ltd (MCX) was trading at Rs.506.6 on BSE, up 0.91% after sources said that corporate affairs ministry has found that the management of National Spot Exchange Ltd (NSEL) violated companies law and that the board of its parent FTIL may be liable for the breaches.

Ranbaxy Laboratories Ltd was trading at Rs.359.30 on BSE, down 1.11% after Daiichi Sankyo Co. Ltd said on Tuesday its Indian unit Ranbaxy has suspended shipment of pharmaceutical ingredients produced at its Toansa and Dewas plants.

US markets closed lower on optimism about merger activity and gains in shares of health insurance companies. The Dow closed up 0.64%, while the S&P 500 gained 0.62% and the Nasdaq 0.69%.

Asian markets were trading higher. Japan’s Nikkei Stock Average gained 1.35%, Hong Kong’s Hang Seng was up 0.51%, while China’s Shanghai Composite was marginally down 0.01%.

Rahul Kumar

1st year pgdm

Haryana hikes financial grant in awards for ex-servicemen

 

The Haryana government on Wednesday said it would hike the financial grant in awards for ex-servicemen.

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Chief minister Bhupinder Singh Hooda announced this while addressing a gathering of ex-servicemen, after laying the foundation stone of Haryana Ex-Services League Bhawan here. The financial assistance for Paramvir Chakra recipients in the state has been hiked from Rs. 31 lakh to Rs. 2 crore, he said.
A recipient of Maha Vir Chakra would get Rs. 1 crore, instead of Rs. 21 lakh, and Vir Chakra recipients would get Rs. 50 lakh instead of Rs. 15 lakh, the CM said.

The recipients of Sena medal, Nausena medal, Vayu Sena medal (bravery) would get Rs. 21 lakh instead of Rs. 7.5 lakh each, he said, adding that the recipient of 'Mention-in-Dispatches' would get Rs. 10 lakh, instead of Rs. 5.5 lakh
                                                                            NAME RAHUL SINGH 2
                                                                                        PGDM 2 SEM.

RBI needs to keep raising policy interest rate to curb inflation: IMF

The Reserve Bank of India will need to continue raising its policy interest rate given the sticky nature of inflation, the International Monetary Fund said on Thursday.
  
"The ingrained nature of inflation and inflation expectations mean that reducing inflation - even over a protracted horizon - will require significant increases in policy rates, which will weigh on growth," the IMF said in a report.
"Should high inflation expectations persist and inflation remain sticky, a more front-loaded path of interest rate increases may be needed," the IMF said.
  

RBI Governor Raghuram Rajan, a former IMF chief economist, has raised the key repo rate by 75 basis points to 8.00 % since becoming head of India's central bank in September. He has made consumer prices its key inflation barometer, a shift away from using wholesale price inflation.

The latest 25 basis point increase, which surprised the market, was on January 28. Rajan, a former IMF chief economist, said in his last policy review that further rate hikes were not anticipated if the inflation trajectory remained subdued.
The consumer price index touched a two-year low in January at 8.79 % as food prices cooled but was still much higher than the wholesale price index of 5.05 %, an eight-month low.
The IMF expects India's consumer price index to remain near double digits well into next year driven by food prices.
It endorsed giving more emphasis to consumer prices for making policy decisions.

"Headline CPI should provide the principal nominal anchor for monetary policy, as food and fuel price shocks propagate rapidly into core inflation, and inflation expectations and wage formation are closely linked to CPI inflation," the IMF said.
The IMF expects India's economy to grow at 4.6 % in the current fiscal year ending in March, picking up to 5.4 % in the fiscal year that starts in April, which is in line with the RBI's expectations

VIKASH CHANDRA MISHRA
PGDM 1ST YEAR
SOURCE: HINDUSTAN TIMES

RBI reduces foreign investment limit in commercial papers

 

The latest RBI move follows a similar move by the central bank on 29 January when it had increased the sub-limit of investment in government securities for long-term investors to $10 billion from $5 billion. Photo: Pradeep Gaur/Mint 

Mumbai: The Reserve Bank of India (RBI) has reduced the amount of money foreign institutional investors (FIIs) can invest in commercial paper from $3.5 billion to $2 billion, the central bank said on its website.

The decision was taken to “encourage long term investors” in the local debt market, RBI said. Commercial paper refers to short-term instruments maturing within a year.

Foreign investors are currently allowed to invest up to $51 billion in local corporate bonds. The sub-limit of investments in commercial paper was part of this limit.

“This sub-limit is being presently utilize only to the extent of around 58%,” RBI said.

“The balance $1.5 billion shall, however, continue to be part of the total corporate debt limit of $51 billion and will be available to eligible foreign investors for investment in corporate debt,” RBI said.

Ananth Narayan, co-head of wholesale banking for South Asia at Standard Chartered Plc, said the RBI was probably seeking to ensure that foreign inflows in the debt market are “more sticky.”

“The fact that they said they want long-term investors means that they are wary of hot money outflows from the debt market like it happened post 22 May,” Narayan said.

Between June and November 2013, FIIs pulled out $13 billion from the Indian debt market after the US Federal Reserve said in May that it is likely to taper its $85-billion-a-month bond purchase programme. The tapering began only last month.

But Narayan said he does not expect the latest RBI move to have any impact on the market because the amount is too small.

The latest RBI move follows a similar move by the central bank on 29 January when it had increased the sub-limit of investment in government securities for long-term investors to $10 billion from $5 billion.

Long-term investors include sovereign wealth funds, multilateral agencies, foreign pension, insurance and endowment funds and foreign central banks, RBI said on its website.

However, the overall foreign investor limit in government securities remained unchanged at $30 billion, RBI said.

 

LOVE GUPTA
PGDM 2nd SEM

SAIL to scale down investment by 22% to Rs.9,000 crore

Highest outlay of Rs2,960 crore has been proposed for the Bhilai plant, followed by Rs1,790 crore for the Rourkela plant 

New Delhi: State-owned steel maker Steel Authority of India Ltd. (SAIL) plans to scale down investment by nearly 22% to Rs9,000 crore on expansion and modernization at 5 integrated plants during the next fiscal.

Highest outlay of Rs2,960 crore has been proposed for the Bhilai plant, followed by Rs1,790 crore for the Rourkela plant. It also plans to invest Rs1,244 crore in Burnpur unit, Rs642 crore in Bokaro unit and Rs588 crore in Durgapur facility. The remaining Rs1,766 crore has been planned to be spent on various schemes such as installation of slab casters, coke oven batteries, oxygen plants and others in various plants, as per the documents of the interim budget 2014-15. 

 

In 2013-14, SAIL is expected to spend Rs11,500 crore, up 18.17% over actual investment of Rs9,731 crore made in the previous fiscal. The company had budgeted Rs13,000 crore total investment for the current fiscal ending 31 March.

 

SAIL is investing Rs72,000 crore to enhance capacity by around 10 million tonnes per annum (MTPA) to 24 MTPA. The ongoing expansion is likely to be completed next fiscal.

 

The other state-owned steel maker Rashtriya Ispat Nigam Ltd. (RINL) has a higher investment plan for 2014-15 at Rs1,724.17 crore as compared to the revised estimate to Rs1,548.72 crore in the current fiscal. Details of investments were not given. Iron ore producer NMDC Ltd. plans to spend Rs4,345 crore next fiscal which is nearly 60% higher than the estimated investment of Rs2,720 crore investment in 2013-14. NMDC had spent Rs1,607.24 crore in the previous fiscal.

 

“The company (NMDC) is also entering into the field of producing high-value products like ferric oxide, iron powder, etc,” the documents state.

 

MOIL Ltd., country’s largest manganese ore producer, plans to invest Rs192.05 crore in 2014-15, up from Rs133.32 crore in 2013-14. The company had spent Rs56.93 crore in 2012-13.

Kudremukh Iron Ore Co. Ltd. (KIOCL) and MMTC Ltd. plan to spent Rs50 crore and Rs45 crore respectively in the next fiscal. Steel ministry controls 10 companies. PTI

 

Source- Livemint.com

 

                 By

Shah Mohammad Abdul Qadir

        PGDM 2nd Sem

IIMT College of Management 

        Greater Noida

Investment tip: Place your bet on low risk stocks

 

 

 I spent much of last week asking investment bankers what the best ever advice they ever got had been. To my surprise, everyone had a standard reply: "Give it your best and results will follow." This wasn't any different from what I had been advised as a child by many people.

But one story my father told stays with me: learn from the ants and how they save for a rainy day.
As children most of us have come across the story of the ant and the grasshopper. While the ant spent his winter drying grains collected in summer and lived well, the grasshopper died of hunger as it had not saved for the winter. The lesson: plan ahead or else don't complain if things don't work out.
Though investment goals differ from person to person, one can't run away from the fact that investment in equities is important for building wealth. According to the Reserve Bank of India (RBI), a mere one per cent of Indian household financial wealth is in equities and shares. A recent study by Axis Bank reveals that even if real estate is excluded from Indian household savings, less than six per cent of the saving is in equities. In the US it is around 45 per cent. There is no doubt that more of Indian household wealth has to be channeled into equity markets. But at the same time investors cannot be blamed for shying away, for many of them have not had pleasant experiences there despite the Sensex having grown more than 26 times in the last two decades.
The major reason is that investors have always invested when the markets were peaking. Their choice of investments has also often been wrong. Be it tech stocks in 2000 or infrastructure and real estate stocks in 2008 and 2009, investors have tried catching momentum stocks and highly volatile stocks such that when market went down by 10 points, their stocks slipped by 20.
The classical financial theory is: the higher the risk, the higher the returns and the lower the risk, the lower the returns. But that is not always true. According to a the study by Nardin Baker and Robert Haugen in April 2012, low risk stocks give higher than expected returns compared to high risk stocks. The study extends over the time period 1990 to 2011 and covers 21 developed markets and 12 emerging markets, including India. Though in the short-term, 'high risk equals high returns' is true, in the long-run, low risk stocks have always delivered better returns. Studies also reveal that over time equity tends to be less volatile. In fact over a 10 year horizon the probability of losing money is nil compared to 35 per cent in one year.
Benefits of long-term investing.


soruce- india today
anand maurya
pgdm-2sem

Tata Power jumps over 7%, NTPC falls 11.5% on CERC order

 

 

Mumbai: Shares in Tata Power Ltd jumped as much as 7.4% in early trade after the Central Electricity Regulatory Commission (CERC) upheld its earlier order of a bailout package to the power company for the electricity generated from its imported coal-based Mundra plant in Gujarat.

This results in an increase in electricity tariffs by 52 paise per unit for the current fiscal year across Gujarat, Maharashtra, Haryana, Punjab and Rajasthan, which are the procurers of electricity for this project.

In an order dated 21 February, which has far-reaching implications for the Indian power sector, CERC ruled that Tata Power will be allowed to temporarily increase tariffs to compensate for the additional fuel costs it is incurring on account of coal imports becoming expensive when the Indonesian government in 2012 started levying higher royalty and income tax, affecting the financial viability of the project. The position will be reviewed after three years.

In reaction to this, shares of state-owned NTPC Ltd fell as much as 11.5% to Rs.116.95, lowest level since 21 Nov 2008.

“Impact on NTPC is seen as negative because the regulator has also tightened the norms for reimbursement of tax expenses, which will in turn hit on their return on equity sharply,” said Arun Kejriwal, director of Kejriwal Research and Investment Services.

State utilities are likely to approach the appellate tribunal for electricity against the order.

At 10:24am, Tata Power shares were up 4.1% at Rs.81.95 a piece on BSE, while NTPC shares dropped 10.8% to Rs.117.90. The 30-share Sensex was trading 0.1% lower at 20,685.42 points.

 

 

 

md .aquil alam

pgdm 1st semester 

source.live mint