Online
| Post a Message | Explore Forums | Browse Stock Messages | Hot Discussions | Top rated Messages | Top Boarders | |
|
|
|
Economy
Tracked by: 0 Boarder
During the meeting of the Prime Minister-chaired committee on tackling the global turmoil the RBI is expected to announce fresh measures to infuse more funds into the cash-starved banking system. The meeting considered certain steps and RBI would look at them... Various methods of injecting liquidity through repo and reverse repo (short-term) rates were discussed, The meeting was attended by Finance Minister P Chidambaram, Commerce Minister Kamal Nath, Reserve Bank of India (RBI) Governor Duvvuri Subbarao and senior government officials, including Finance Secretary Arun Ramanathan and Commerce Secretary Gopal K Pillai.
To a question on the job cuts, he said the government would not hesitate to raise tariffs sharply wherever cheap imports were causing injury to the domestic industry.The meeting looked at liquidity issues, especially in housing, construction and non-banking financial sectors.The RBI has unlocked Rs 2.75 lakh crore during the last a few weeks through cuts in various mandatory deposits that banks need to keep with the central bank. It also allowed housing finance companies to borrow short-term funds from overseas sources.
...
Tracked by: 0 Boarder
India`s economy will ``bounce back`` to 9 percent growth next year as local demand holds up amid a global recession, Finance Minister Palaniappan Chidambaram said. ``There will be a slowdown in India and steps taken and those that will be taken, to a large extent, will compensate the factors causing the slowdown,``
Chidambaram told the World Economic Forum`s India Economic Summit in New Delhi today.
The Harvard-trained minister signaled interest rates will come down in Asia`s third-largest economy and said he will examine further excise duty cuts to spur consumer spending. Record crop plantings by India`s 400 million farmers will also boost rural incomes, Chidambaram said.
India`s economy may slow to 7.5 percent in the year ending March 31, after expanding 9 percent or more annually in the previous three years, according to the central bank. India`s government wants to sustain growth rates above 9 percent to cut poverty in the world`s most-populous country after China.
``To sustain 9 percent growth, you need international economies to turn around as well,`` said Jai Sinha, partner and co-head, India, at Booz & Co., a global management consulting firm.
``International capital flows into infrastructure and exports must pick up.``
xport makes up about fifth of India`s $1.2 trillion economy. Chidambaram said any shortfall in shipments and overseas investment will be ``compensated`` by spurring demand in the local economy.
Weaker Exports
India`s exports have weakened as the U.S., Europe and Japan fell into a recession in the third quarter. That`s spooked investors into withdrawing money from emerging markets such as India, where foreign funds have pulled out a record $12.8 billion from the stock market this year.
The benchmark Sensitive index fell 2.2 percent to 9090.75 on the Bombay Stock Exchange in Mumbai, while the yield on 10-year government bonds dropped 1 basis point to 7.5 percent. The rupee declined as much as 0.9 percent to 49.80 per dollar, the lowest since Oct. 29, before trading at 49.70.
Reserve Bank of India Governor Duvvuri Subbarao, after meeting Chidambaram this morning to discuss India`s response to the global financial crisis, said the central bank would take ``appropriate action at an appropriate time.``
Subbarao has cut the central bank`s benchmark repurchase rate by 1.5 percentage points to 7.5 percent in the past month, in addition to slashing lenders` reserve requirement in cash and bonds by 3.5 percentage points and 1 percentage points respectively.
Subbarao has room to lower borrowing costs further after the inflation rate dropped at the sharpest pace in at least 18 years this month. Inflation has slowed to 8.98 percent from a 16-year high of 12.91 percent in August.
Chidambaram said it will be ``good`` if interest rates decline, adding that the ``classic solution`` to a demand slowdown is to reduce prices and he urged airlines, hotels and other companies to do so for a ``short period of time.``
``The problems that India faces are not insurmountable,`` the minister said.
``They have been easily identified and we can address these issues - liquidity, prices and credit delivery.``
He said Prime Minister`s Manmohan Singh`s government will balance the objectives of growth and inflation, while pointing out that at this point the ``bias is in favor of stimulating growth.``
``India is still relatively insulated from what is happening in the rest of the world,`` said K.V. Kamath, the chief executive officer of ICICI Bank Ltd., India`s second-biggest bank. ``We need a significant drop in interest rates to accelerate growth.``
Still, Chidambaram said the worst growth forecast for India this year is 7 percent, which is three times the world`s economic expansion. Kamath said growth may not fall below 7 percent if the $700 billion that Indian companies plan to invest in the next two years proceed.
``The world economy has changed more rapidly in the last 60 days than it has over a long time,`` Chidambaram said.
``But the manner in which most Indians live and work hasn`t changed.``
The minister said 65 percent of India`s workforce depends on agriculture, which
continues to grow at a robust pace.``
The total winter crop sowing area increased to 2.69 million hectares this year from 2.19 million hectares a year ago, the minister said.
``Farmers are busy with their work and we are going to have a substantial bumper crop,`` Chidambaram said. ``The sector that is affected by the global crisis is industry and the financial sector and our mind space has been occupied by them. We are extremely vigilant and will continue to be proactive in our policies.``
...
Tracked by: 0 Boarder
In our beloved FM`s definition, bearing the brunt of the global recession is not a problem for India? India does not have a problem? Duh?...
In reply to:
See longer,deeper global recession but India to cope: FM
Posted by :
MMB Messenger
Finance Minister P Chidmabaram speaking on the effect of the current global crisis on India said that there have been recessions in the past but added that the current recession threatens to last longer and deeper than before. He said that we India does not have a problem but is bearing the brunt of the spillover of this global recession.
Tracked by: 0 Boarder
I totally disagree with the above statement. Rupee will not fall below 50 at any point of time. Exports will do the trick for India provided India Inc & Govt has taken positive steps...
In reply to:
See Re at 52/$ before strengthening by `10: Jamal Mecklai
Posted by : MMB Messenger
Jamal Mecklai, CEO, Mecklai Financial, feels the rupee will gain strength by 2010. "However, before that it will weaken and touch Rs 52 to a dollar. The next six months is going to be very uncertain."
Tracked by: 0 Boarder
Jamal Mecklai, CEO, Mecklai Financial, feels the rupee will gain strength by 2010. "However, before that it will weaken and touch Rs 52 to a dollar. The next six months is going to be very uncertain."...
Tracked by: 0 Boarder
The Investors in the stock market wants some confidence about the markets trend towards upside.when they came to know and invested in the peak time,during the time the in/out should be advertised and awarness to be created,When we go up there should be downside also. this should be stressed to the investors always.I think this should be as STATUORY WARNING.Because most of the money came to Equity market during peak time are RETAIL Investors money.Now only the trade is going No Investors are investing, so the previous Investors are looking the screen when it will cross 21k or 6 k. Some precautionary informations to be published.A lot of NFO/IPO\\\\\\\\`s came during the period to swallow the Investors money without any Hurdle.
The rest period to be positive for which all steps to be taken by the government and regulatory boards.
r.seenivasan
Tirunelveli...
In reply to:
See longer,deeper global recession but India to cope: FM
Posted by : MMB Messenger
Finance Minister P Chidmabaram speaking on the effect of the current global crisis on India said that there have been recessions in the past but added that the current recession threatens to last longer and deeper than before. He said that we India does not have a problem but is bearing the brunt of the spillover of this global recession.
Tracked by: 0 Boarder
Finance Minister P Chidmabaram speaking on the effect of the current global crisis on India said that there have been recessions in the past but added that the current recession threatens to last longer and deeper than before. He said that we India does not have a problem but is bearing the brunt of the spillover of this global recession.
...
Tracked by: 1 Boarder
Hi MM
Spending two hourse from 4am to 6am today, you have reduced the wealth of top business tycoons viz Suzlon, Rel comm, HDFC, Unilever, Larsen and ONGC etc .to almost negligible levels. How will we work with stocks of cos whose wealth status is `Pauper` ?
regards
/TC/...
In reply to:
India enters into confirmed recesion !!!!
Posted by : marketman
Japan on Monday joined the euro zone in recession. Although the U.S. economy contracted in third quarter, that followed two consecutive quarters of growth, albeit helped by government stimulus payments. The arbiter of U.S. business cycles has not yet declared the economy in recession.
Tracked by: 0 Boarder
Yes, they are wainting for all small traders to move to Shorts, then one fine they will announce all good news to crush in either direction...:(...
In reply to:
Inflation eases down....
Posted by : marketman
Inflation will further eases down in coming weeks.... but govt not interested to cut interest rates to globla levels.... not reducing oil prices as promised earlier....
Tracked by: 0 Boarder
Inflation will further eases down in coming weeks.... but govt not interested to cut interest rates to globla levels.... not reducing oil prices as promised earlier.......
In reply to:
Inflation eases down....
Posted by : marketman
As inflation eases down to 8% levels,it could be the right ime to cut the interest rates further.... nearly 200 basis points cut is required for the economy not to fall into recesion....
Tracked by: 1 Boarder
Japan on Monday joined the euro zone in recession. Although the U.S. economy contracted in third quarter, that followed two consecutive quarters of growth, albeit helped by government stimulus payments. The arbiter of U.S. business cycles has not yet declared the economy in recession.
...
In reply to:
India enters into confirmed recesion !!!!
Posted by : marketman
By seeing present situation and expecting near term outlook,the few economists forecasting prolonged/deep recesion in india too....
Over dependence on america, overall global slowdown,rigid govt policies,over hype in economy in the recent past,stock market meltdown,cyclic bear phase in many sectors,collapsing of software,real estate,aviation, financial sectors etc etc are the main reasons of the present situation of the indian economy....
Thanks to manmohan govt for not taking proper preventive measures and now india is entering into worst economic situation ever, under his leader ship....
Tracked by: 0 Boarder
Mr Sardesai is saying if the downturn intensifies then (only??) UPA will be affected? It will be effected even in the current situation. The situation need not get any worse for that.
Fact is this govt. has done nothing for infra development. Not a single steel plant was established in India in the term of this govt. And its ministers were busy arm-twisting steel makers to reduce price for the benefit of their friends in real-estate industry which probably is the only industry that flourished and made all corrupt politicians, officers and builders rich.
Fact is neither this govt created the boom (not that it was capable of) of last four years nor the present bust. But if they were taking credit for the boom, they must face the axe for the bust too. If US elections are any indication where American people gave an overwhelming support to a coloured politician who was probably just a political novice then what happens to UPA in our country is anybody`s guess....
In reply to:
Downturn could dent UPA`s election prospects: Sardesai
Posted by : MMB Messenger
Rajdeep Sardesai, Editor-In-Chief, CNN-IBN, feels the current economic downturn, if it intensifies, could be a disadvantage for the incumbent UPA government ahead of the crucial general assembly elections next year though, at the same time, it presents an opportunity for Prime Minister Manmohan Singh to be seen as proactive.
Tracked by: 0 Boarder
dear Gurupada but why this repetition of a single message
and so many times to mmb mesenger ??
regards,, soldier7...
In reply to:
Downturn could dent UPA`s election prospects: Sardesai
Posted by : Gurupada
Present Govt should announce a Huge stimulus package in terms of Infrastructure projects....
covering the next few years....
covering all aspects of/in infrastructure....
which wud definitely give Big boost to the INDIAN economy...,
and which may also start attracting foreign capital in those projects after sometime over a period of time lasting the duration of those projects.
populist mesures like reduction in domestic fuel prices is only a tid bit.....
well yes they cud be reduced by small amount without hurting the oil marketing cos....
and use some of the reserve amount in/for the infrstructure projects.....
Dears Manomohana/Chhid-ambaram/Montek SA r u all listening....???
Cud u trio start thinking creatively and start collecting/weaving the feathers for ur respective caps....
may even give u all at UPA a landslide victory....
come on U (The Trio)Boys !!! so far...Be man enough and ACT FAST....
Tracked by: 1 Boarder
Crisis sends Japan into first recession in 7 years
...
In reply to:
India enters into confirmed recesion !!!!
Posted by : sambala
While most IPOs have nose-dived in the current bear phase, some are still afloat. Though it is difficult to find a common thread in the success of these IPOs, since they belong to diverse sectors, many of them are mid-sized companies with niche areas of operation and a good presence in the domestic market. For instance, Educomp Solutions, which leads the list of IPO gainers, has gained 20 times from its initial offer price of Rs 125. This Rs 286-crore company is one of the prominent players in online education.
Following the crash in global equity markets, the primary market in India has almost dried up. Companies wishing to raise equity capital are in a wait-and-watch mood as valuations are on slippery ground. But one thing is certain — the days of ‘irrational exuberance’ are over and only those IPOs which have substance will sail through these tough times.
By ET INTELLIGENCE GROUP
Tracked by: 1 Boarder
While most IPOs have nose-dived in the current bear phase, some are still afloat. Though it is difficult to find a common thread in the success of these IPOs, since they belong to diverse sectors, many of them are mid-sized companies with niche areas of operation and a good presence in the domestic market. For instance, Educomp Solutions, which leads the list of IPO gainers, has gained 20 times from its initial offer price of Rs 125. This Rs 286-crore company is one of the prominent players in online education.
Following the crash in global equity markets, the primary market in India has almost dried up. Companies wishing to raise equity capital are in a wait-and-watch mood as valuations are on slippery ground. But one thing is certain — the days of ‘irrational exuberance’ are over and only those IPOs which have substance will sail through these tough times.
By ET INTELLIGENCE GROUP ...
In reply to:
India enters into confirmed recesion !!!!
Posted by : sambala
Investors lose in most companies listed since Jan `06
How do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions?" As part of a speech in late 1995, former US Federal Reserve chairman Alan Greenspan had raised this fundamentally intriguing question.
His speech was soon followed by a worldwide slump in the stock market. No wonder then that the question, along with the term ‘irrational exuberance’, soon became famous among economists and statisticians.
Now, after 13 years, we are compelled to revisit both the question and the iconic term coined by the legendary Mr Greenspan in the context of the burst of price bubble in the Indian IPO market.
An ETIG study reveals that in the current stock market carnage, investors have lost a fortune in most of the companies that were listed since January ’06. We decided to look at IPOs since ’06 because that was the year when valuations started looking up. The ensuing months saw valuations soaring further, resulting in the so-called ‘irrational exuberance’ somewhere down the line. Since January ’06, 221 big and small companies have raised capital in the primary market.
Barring the past 10 months, the period under observation encompassed a boom in the global stock markets and other asset classes. This led to increased valuations of these newly listed companies. Now that the bull run is over and the stock markets are in the grip of a bear hug, the prices of most of these stocks have nose-dived to low levels.
Our study shows that four out of every five companies are currently trading at prices which are substantially lower than the prices at which they were offered to investors during their IPOs. As many as 179 scrips out of the sample set of 221 have fallen below their offer price.
Moreover, 193 companies are now trading below their listing price.
The fall in stock prices has been 90% or more for some companies. The steep decline in valuations of companies that belong to various sectors reminds us of the ‘irrational exuberance’ that Mr Greenspan was talking about. While the fall has been secular, spanning across all sectors, metal, power, construction, textile and IT have been the worst affected. During the said period, three metal companies and five power companies came out with their IPOs. Investors who put their money in any of these companies would have seen erosion in their investments by now.
None of these companies are currently trading above their offer price. The construction sector, which includes real estate companies, saw the highest number of IPOs over the past twoand-a-half years. As many as 29 companies in this sector came out with IPOs. However, only four of them are still earning returns for primary investors. In the case of textiles, 15 out of 18 companies have witnessed erosion in investors’ wealth.
The ride has not been smooth for IT companies either. Among the 24 IT companies that floated IPOs, 16 are now trading below their offer price. The sector is grappling with macro-economic adversities, including currency fluctuations and slowdown in the US and European markets.
Our study also reveals interesting facts about the FMCG sector. Though this sector is considered a safe bet during turbulent times due to its defensive nature, it has not performed well on the IPO radar. Out of five FMCG companies that raised money from the primary equity market, only one has so far generated returns for the original investors. The market turmoil has not spared the IPOs of public sector companies either.
Two out of five PSU IPOs have fallen below their offer price. These are Rural Electrification Corp (37.2% drop from its offer price) and Central Bank of India (- 61.8%). The three PSU IPOs that are still in positive zone are Power Grid Corp (46.9% gains above its offer price), Power Finance Corp (32.8%) and Indian Bank (50.7%).
CONT.....
