| Major News Item |
Impact Analysis |
| Banking bad loans eased by 0.4% to Rs.9.46 trillion in September 2017 |
- This is the first time that the bad loan situation has eased since stringent provisioning began in 2015
- This is a signal that the NPA cycle of banks may be bottoming out although we may have to await sustained evidence
|
| Maruti regains its 50% market share in passenger cars after 10 years |
- The rapid expansion of Maruti in the last 3 years has managed to position it in each and every customer segment
- Despite slower growth in the December quarter, Maruti has still managed to hold margins while expanding market share
|
| D-Mart saw a 140 bps expansion in gross margins in December quarter |
- Nearly 50 bps out of the 140 bps margin expansion came from the implementation of GST
- Analysts are, however, worried that at the current rich valuations there may not be room for upside re-rating
|
| Government gives an export boost through duty drawback on 102 items |
- The hike in duty drawbacks will help make the Indian exports more competitive in the global markets
- The export sector performance had been lagging due to a strong rupee
|
| ITAT rules against Vodafone Services in the tax dispute |
- Dispute relates to a form versus substance debate about an international transaction masquerading as domestic
- The ITAT has deemed it to be an international transaction considering the substance of the relationship
|
| FMCG companies to be hit by ban on sale of food products in paan shops |
- The ban was first imposed by the state of Maharashtra and more BJP rules states may follow suit
- Key sub-segments like confectioneries derive up to 30% of sales from paan shops and may be the worst hit
|
| ONGC to expand its borrowing capacity by 40% this year |
- ONGC will be investing up to $5.8 billion to buy out the 51.11% stake in Hindustan Petroleum
- While ONGC already has $2 billion in cash it will be using a mix of borrowings and stake sales to fund the acquisition
|
| Crude oil bets have crossed the $100/bbl mark for the year |
- Analysts and traders are betting that the OPEC supply cut could really compress supply during the year
- At the same time the revival of growth in EU and Japan and the US tax cuts could spur demand for oil
|
| Viral Acharya calls for an online platform to sell stressed assets |
- This model of selling stressed assets online has been quite successful in South Korea and the US
- By definition it is likely to be a more transparent and effective method of getting a good price for stressed assets of banks
|
| Mutual funds add nearly 1.37 crore folios in the year 2017 |
- This takes the total folios to 6.65 crore indicating that MFs have really attained critical mass in India
- Most of the folios additions have come in equity funds and ELSS funds via the SIP route; indicating retail appetite
|
| Tata Sons may be looking at ways to buyout the stake of Mistry group |
- The Mistry family has an 18.4% stake in Tata Sons and that has been the source of clout in Bombay House
- Post the ouster of Mistry, relations between Tatas and Mistry have soured and exit appears to be the only option
|
| Axis bank reported a 25% growth in profits at Rs.726 crore. |
- While gross NPAs in absolute terms were up, they were down in percentage terms due to higher loan growth
- With the NPA cycle likely to have bottomed out, the bank may be able to sustain its 22% loan book growth
|
| IMF bets on US tax cuts to spur global growth in 2018 |
- IMF is expecting the global economy to growth at a much higher 3.9% in the current calendar year
- The US is likely to growth at 2.7% and India may still be the fastest growing large economy in the world
|
| Narendra Modi makes a passionate pitch at the WEF in Davos |
- It was the first time after 21 years that an Indian PM had graced the occasion at the Davos forum
- Modi has projected the Indian economy to become a $5 trillion economy by 2025
|
| Indiabulls Housing flattered the street with 55% growth in net profits |
- The growth was achieved through aggressive business growth and tight control on gross NPAs at just about 0.7%
- The company has set an aggressive borrowing limit of Rs.28,000 crore to expand its loan book
|
| JSW looks to take a stake in Bhushan Steel and Electrosteel |
- JSW may not look at a merger immediately but will focus more on turning around these businesses
- Merger with these companies will only be implemented at a later date once operations stabilize
|
| Uday Kotak speaks up against 100% foreign ownership of Indian banks |
- According to Kotak, the focus of the government should be to develop banks through domestic ownership
- With 2% current account deficit, foreign ownership may not be a very feasible scenario for India
|
| Nifty and Sensex touch record levels during the week |
- The big boost came ahead of a growth oriented budget expected in February this year
- The earnings are also likely to get a boost from the bank recapitalization due to deleveraging
|
| Government lays out a clear roadmap for recapitalization of banks |
- The government has allocated Rs.88,000 crore of which Rs.80,000 crore will be by way of recap bonds
- However, this aid comes with strict conditions on operating efficiency and viability of foreign branches
|
| Sun Pharma bets on global generics industry bottoming out this year |
- Indian generics companies like Sun and Lupin have taken a hit on profits due to fierce price competition
- The consolidation of US pharmacies has also been negative but that threat also seems to have bottomed out
|
| UBS chairman sees huge potential damage to Bitcoin prices |
- Weber expects that tighter regulation by central banks will dent the attractiveness of crypto currencies
- Bitcoin is already down by 50% in the last 1 month and looks quite vulnerable at this point of time
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