| News Announcement |
Impact Analysis |
| NDA scores a decisive victory in the national elections |
- With 303 seats for the BJP and over 350 seats for the NDA, it was truly an election which was Modi all the way
- The NDA not only dominated the Hindi belt but also made serious inroads into the states of Orissa and West Bengal
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| Sensex crosses 40,000 on the day of election counting on May 23rd |
- While markets started the celebration post exit polls, the real thrust came on the counting day
- While the Sensex lost 1200 points from the peak, Friday was again a decisive up move of over 620 points
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| Oil prices in the Brent market fall sharply during the week |
- Most of the losses (in excess of 5.2%) came in a single day on Thursday due to trade war fears
- Rising US stockpiles also pulled crude prices down. Brent has lost over 10% since its recent peak of $75.60/bbl
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| Brokerages turn positive on banks and rate sensitives post NDA win |
- The PSU bank stocks were among the major gainers on hopes of speedy IBC resolution and more capital support
- NBFCs and realty also celebrated on expectations of lower interest rates and sufficient liquidity support
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| FPIs turn net buyers during the election counting week |
- FPIs turned net buyers during the election counting week on hopes of a stable government at the centre
- FPIs had been net sellers through the month of May but that has now been more than compensated for
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| RBI moots stringent checks and balances on NBFCs |
- One of the steps the RBI has taken is to set up a separate supervision department for the new kinds of risks
- RBI may also put limits on NBFCs on asset liability mismatch and insist on greater disclosure
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| Reliance Capital exits the MF business and sells out to partner Nippon |
- With the stake sale worth Rs.6000 crore, Nippon Life Asset Management becomes 85% owner of the AMC
- The Reliance ADAG group has been desperately looking to monetizing assets to reduce its group debt
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| Theresa May agrees to step down on June 07th after no deal |
- With May unable to get the required support for her BREXIT deal, she will move on effective June 07th this year
- That still leaves the option of BREXIT turmoil open as BOE has estimated 7% fall in GDP if exit is tumultuous
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| JSW Steel to raise Rs.14,000 crore to fund its expansion plans |
- JSW plans to expand its steel capacity to 24 MTPA by 2022 at an investment outlay of Rs.48,000 crore
- The company had reported a sharp 48% fall in net profits in the March quarter due to higher input costs
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| L&T hikes stake in Mindtree to 28.45% through purchase of 2.49 mn shares |
- The open offer scheduled to open on 14th May has been postponed pending SEBI approval for the open offer
- L&T targets to take its overall stake in Mindtree to 66% to add a digital flavour to L&T’s IT business
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| RBI likely to introduce liquidity coverage ratio for NBFCs |
- The LCR will be restricted only to those deposit taking NBFCs that have a loan book of more than Rs.5000 crore
- It is the minimum liquidity that these NFBCs will have to maintain at any point of time to be operational
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| Modi government created $1 trillion of stock market wealth in 5 years |
- The market cap of the BSE moved from Rs.75 trillion to Rs.150 trillion between May 2014 and May 2019
- During this period, the indices Nifty and Sensex were up by 60% with most wealth coming from outside this set
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| Hinduja Group may be evaluating options to buy Jet Airways |
- Jet may finally find a buyer in the form of Hinduja group of London and Naresh Goyal too could make a comeback
- However, Hinduja Group has apparently set some very stringent conditions for their participation
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| Spice Jet CEO calls for tax cuts on ATF or inclusion in GST |
- ATF costs are nearly 60% of the operating costs of the airline and have put the most pressure on airline companies
- One way that is being considered to begin by bringing ATF under the GST ambit, while leaving out petrol and diesel
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| Rupee strengthens post the Modi win during the week |
- A decisive mandate for the NDA combined with strong FPI flows kept the INR buoyant during the week
- The trade war is likely to impact oil prices and that is also one reason why the rupee strengthened
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| Aviation sector shows de-growth of (-4.3%) in April 2019 |
- This is the first month of negative growth in aviation since the month of June 2013, post which it has been growing
- The fall was a result of Jet shutting down and also weak demand due to high airline prices
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| Indian industry puts forth a charter of demands from Modi government |
- With NDA 2.0 taking charge on May 30th, industry has demanded lower corporate taxes, FDI and bold reforms
- The industry bodies have urged the government to spend more on primary health, education, skills and infrastructure
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| Fitch expects a major consolidation in the NBFC sector in India |
- Fitch foresees NBFCs merging or acquiring with larger banks for a bigger and sounder balance sheet
- Just a couple of years back, India had seen a major consolidation in the telecom sector post Jio launch
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| Mutual funds and PMS permitted to trade in commodity derivatives |
- Mutual funds will be allowed in commodity derivatives for maximum holding period of 1 month only
- PMS in commodity derivatives will have less restrictions but all decisions will be subjected to client approval
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| NSE files an appeal with SEBI over the direction and quantum of penalties |
- The SEBI order pertains to the preferential access given by NSE to select brokers in low latency trades
- A prolonged hearing at the SAT could further delay the IPO of NSE as it is contingent to the resolution of the issue
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| Nestle dismisses stories of slowdown in consumption in India |
- Suresh Narayanan maintained that both his food products were growing at double digit growth
- Narayanan feels the impact is more temporary and is unlikely to sustain for too long, especially rural consumption
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