| News Announcement |
Impact Analysis |
| The rupee tested the level of 72/$ for the first time during the week |
- The worries over the trade deficit and the CAD took the INR to beyond the 72/$ mark on importer buying of dollars
- However, the dollar did see some selling support from the RBI around the 72/$ mark helping the INR to close stronger
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| Current Account Deficit at 2.4% was better than market expected |
- The street was expecting CAD at around 2.5% of GDP due to pressure from the trade deficit
- However, some of the brokerage houses like Nomura have maintained their year-end target of 2.8% for CAD
|
| Amitabh Chaudhry to take over as the CEO of Axis Bank |
- The name of Amitabh Chaudhry, former CEO of HDFC Life, has been approved by RBI as next CEO of Axis Bank
- Interestingly, this is the second time that Axis Bank is getting an insurance head as CEO after Shikha Sharma
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| SEBI eases FPI norms after investors warn of $75 billion FPI outflow |
- This pertains to an April 10th circular which had put stringent restrictions on final beneficiary ownership of FPIs
- With a view to avoid disruptive outflows, SEBI has now allowed NRIs to hold a 25% minority stake in such FPIs
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| RBI is now likely to conduct a special audit of the books of IL&FS |
- The matter was precipitated last week after IL&FS defaulted on inter corporate deposits worth Rs.1000 crore from SIDBI
- RBI will now investigate why this matter was not reported in advance to the regulator much earlier
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| Government rules out any excise duty cuts on diesel and petrol |
- Petrol and diesel prices in India have already touched a life-time high and that is not great news for inflation
- The bigger worry for markets is that with elections coming the government may now load subsidies on oil companies
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| IFCI reported a surprising Rs.340 crore loss in the June quarter |
- The net loss contrasts with a net profit of Rs.277 crore in the first quarter last year. Revenues were sharply lower
- The company took a hit of nearly Rs.450 crore in its income statement on asset impairment charges
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| China’s record trade surplus with the US may be sign of miscued tariffs |
- If Trump wanted to win the trade war with China, the reverse is happening with a $31 billion trade surplus for China in Aug
- US exports to China have been hit hard due to counter tariffs and another $200 billion of Chinese goods will be included
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| Mutual Fund assets under management touches all-time high of Rs.25.2 trillion |
- This comes on the back of a massive Rs.175,000 crore MF AUM collection in the month of August alone
- Retail flows have been positive for 29 months in a row while number of folios have risen for 51 months in a row
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| Aurobindo buys Sandoz dermatology unit for a price of $1 billion |
- This deal will give Aurobindo a major foothold in the US skin care market. $900 million will be paid in cash
- This is part of Aurobindo’s inorganic strategy to make the best of the gradual revival in the US business
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| Gadkari makes a fervent pitch for shifting to eco friendly cars |
- The first target will be to reach 15% Electrical Vehicles (EV) penetration by the year 2023 and 100% by 2033
- Indian auto companies are already investing heavily in EVs with the next 15 years in perspective
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| Goldman Sachs scraps plans for a dedicated crypto trading desk |
- Goldman was the first large investment house to plan a dedicated Bitcoin clearing desk for large clients
- However, considering the plethora of regulatory hassles involved, Goldman has shelved plans for now
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| Reliance Infra starts getting rating upgrades after Adani deal |
- CRISIL may be the next to upgrade Reliance Infra after Brickworks on the back of the Adani power sale
- The ADAG group overall has been consistently monetizing assets to reduce its overall debt by 60%
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| Bond yields settled above the 8% mark during the week on rate hike worries |
- Bond markets are veering around to the view that RBI may be forced to hike rates to stem the fall in the rupee
- Bond yields normally reflect the trajectory of rate movements and 8% has been the resistance for a long time
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| Falling forex reserves may be a major concern for the RBI |
- The RBI reserves have fallen below the $400 billion mark and hence sustained intervention may be unlikely
- That may leave the RBI with the only option of hiking the interest rates to contain the rupee
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| Arvind goes in for a major restructuring of its product lines |
- Arvind may be shifting to a more asset light strategy over the next few years by outsourcing its manufacturing operations
- The focus of Arvind will shift towards man-made fibres rather than towards traditional textiles
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| JSPL to go for a comprehensive restructuring of debt |
- JSPL may split the company into discrete businesses to reduce its Rs.42,000 crore of debt burden
- Apart from hiving off non-core businesses, JSPL will separate its steel, power and international businesses
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| Lanco group of Hyderabad may go in for NCLT liquidation of power assets |
- The group has a total debt of over Rs.50,000 crore and is one of the distressed power assets plaguing banks
- The group is owned by Lagadapati Rajgopal, son-in-law of former Congress MP, P Upendra
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| PMI for goods and services come in marginally lower for August |
- There was a minor slackening in manufacturing but a sharp slackening in the services PMI
- While both the PMIs are still above the cut-off mark of 50, they do betray a slowdown in growth momentum
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| Maruti reports fall in sales in August by -3.4% on flood worries |
- The Kerala floods took its first toll in the form of negative monthly sales for Maruti for August
- The company also suffered as most buyers decided to put off purchases to the festival season later this year
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| Jackie Ma steps down from the helm of Alibaba |
- Alibaba was one of the largest IPOs which put the company in the big ecommerce league with $500 bn market cap
- While Jackie Ma will remain on the board of Alibaba, he proposes to devote more time to philanthropic activities
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