India News This Week – Pakistan & Gulf Economist
Investment tips: 2019 Lok Sabha elections coming, here’s where you should invest whether Modi loses or wins
Indian stocks have been roughed up along with most markets in recent months, but there could soon be reason to cheer. National elections are due by 2019, and modern history shows that tends to be a good thing for investors.
While Prime Minister Narendra Modi faces an uphill battle to sustain his party’s majority in the key lower house of parliament, the past six elections show positive returns for Indian equities over the two years that straddle the vote — regardless of whether power changed hands.
The fiscal years prior to elections showed positive gains for the benchmark S&P BSE Sensex index in all but two of the past six ballots, and one of the loser years was 2008 — when markets round the world were upended by the global financial crisis.
Governments of course have plenty of incentive to boost growth in the run-up to elections, potentially feeding through to corporate earnings as well. Optimism about a new administration’s game plan could also help explain the history.
Investors might hope for a repeat of the 2004 election when it comes to the impact on equities. The Sensex saw a 113 percent advance over the two years through March 2005.
Sensex trades flat as Wipro tanks 4%; reliance naval falls 18% to new record low, pc jeweller crashes 15%
Indian equities extended gains after opening flat on Thursday with Sensex and Nifty trading marginally higher ahead of the Q4 earnings of major private sector bankers Axis Bank and Yes Bank among others. Shares of India’s third-largest Wipro emerged as the top losers among the BSE Sensex components on Thursday after the IT major reported weaker-than-expected financial results for the quarter ended 31 March 2018. Shares of heavyweight private sector banks such as ICICI Bank, Axis Bank, Kotak Mahindra Bank and Yes Bank traded in negative territory steering the benchmark Nifty Bank index in red. The benchmark Sensex was trading 0.25% higher at 34,586.4 while NSE Nifty was trading up 0.19% at 10,590.35 on Thursday.
Following the earnings first reaction on Thursday, the stock of Wipro tanked 4.56% to a day’s bottom of Rs 274.1 after opening 3.55% lower at Rs 277 on BSE. Wipro posted more than 20% drop in the consolidated profit to Rs 1,800.8 crore for the quarter ended 31 March 2018 as against a profit of Rs 2,267 crore in the corresponding period last year, according to Indian accounting norms. Wipro’s net income in the January-March period of the financial year 2017-2018 came at Rs 14,304.6 crore, down by 4.9% as compared to Rs 15,045.5 crore in the same quarter a year earlier.
Shares of RIL, HUL, Asian, Paints, M&M, Infosys, TCS were the major gainers on BSE Sensex on Thursday. Shares of Anil Ambani group’s Reliance Naval and Engineering Ltd crashed more than 18% to a fresh all-time low of Rs 18.55 on BSE. Earlier on Monday this week, Reliance Naval and Engineering said that its net loss has been escalated nearly three-fold. Reliance Naval and Engineering net loss for the quarter ended 31 March 2018 came at Rs 408.6 crore as against a loss of Rs 139.92 crore in the same quarter last year.
Shares of PC Jeweller crashed for the second consecutive day on Thursday. The stock of PC Jeweller plunged 15% to a day’s low of Rs 207.65 on BSE. Earlier yesterday, shares of Delhi-based jewellery maker PC Jeweller Ltd tanked nearly 18% in the late afternoon trade on Wednesday amid the unusual volumes. PC Jeweller shares tumbled as much as 17.71% to a day’s bottom of Rs 238.1 before settling down 16.02% at Rs 244.4 on NSE on Wednesday.
Wall Street limped into positive territory on Wednesday on optimism over a spate of upbeat earnings that was nearly offset by jitters over rising U.S. bond yields and corporate costs, it is said in a report. The Dow Jones Industrial Average rose 59.7 points or 0.25% to 24,083.83, the S&P 500 gained 4.84 points or 0.18% to 2,639.4 and the Nasdaq Composite dropped 3.62 points or 0.05% to 7,003.7
This FMCG stock nearly tripled in 3 years of IPO: buy this mid-cap share and gain up to 30%
The domestic stock markets have seen the blockbuster financial year 2017-2018 in terms of IPO (Initial Public Offering) with some of the biggest public offers of India such as GIC’s Rs 11,370 crore share sale, The New India Assurance Company’s Rs 9,600 crore public issue and HDFC Life Insurance Company’s Rs 8,700 crore public offer. It has been observed that some public offers are able to gather investor attention while some public issues fail to get even 100% subscription out of the total number of IPOs in a certain time period.
In the last financial year only, there were IPOs such as Avenue Supermarts, CDSL, Salasar Techno Engineering, Capacit’e Infraprojects, MAS Financial Services and Dixon Technologies were subscribed more than 100 times.
We bring to you one such mid-cap FMCG stock that has nearly tripled in just three years of IPO from the issue price to buy and gain up to 30%. According to Axis Securities, the company is focused on the huge opportunity and cognizant of this has launched affordable and innovative small packs to cater to this price sensitive market.
Shares of Manpasand Beverages Ltd have surged more than 160% from the issue price in the last three years. The stock of Manpasand Beverages Ltd has returned 164% to Rs 422 from the issue price of Rs 160 (issue price is adjusted with a 1:1 bonus issue). Earlier in 2017, Manpsasnd Beverages issued bonus shares in a ratio of 1:1 of face value Rs 10 per equity share. Over the span of last one year, Manpasand Beverages Ltd shares have risen about 15%. In the initial public offering, Manpasand Beverages successfully raised Rs 400 crore at the upper end of the price band of Rs 290 to Rs 320.
The research and brokerage firm Axis Securities Ltd has given a buy rating with a target price of Rs 528 which implies an upside of 30% from the current market price of Rs 404.9. Manpasand Beverages Ltd is focused on the huge opportunity and
cognizant of this has launched affordable and innovative small packs to cater to this price sensitive market, Axis Securities said in a report.
Manpasand Beverages Ltd commands a market capitalisation of Rs 4,647.75 crore on BSE on the basis of the share price of Rs 406.05. Manpasand Beverages Ltd shares are categorised in the group ‘B’ on BSE and are a component of S&P BSE 500 and Nifty FMCG indices.
Shares of Axis Bank, Wipro, Yes Bank, Indiabulls Real Estate, Reliance Capital, SBI Life in focus
Indian stock markets are likely to open flat on Thursday as investors remain cautious over the ongoing corporate earnings season and the subdued global cues. The early indicator of NSE Nifty, SGX Nifty Futures was trading little changed, down 0.16% at 10,575.5 on the Singapore Exchange on Thursday. Shares of India’s third-largest and fifth-largest private sector lenders Axis Bank and Yes Bank will be on close watch ahead of their respective Q4 results for the fiscal year ended 31 March 2018. Other major companies which are also scheduled to release the earnings report card are Reliance Capital, SBI Life Insurance Company, Biocon, AU Small Finance Bank, Rallis India, Aditya Birla Money, Parag Milk Foods, Shriram City Union Finance, Tata Elxsi, Artson Engineering, Automotive Stampings, Coromandel Engineering, Essel Propack, HIL, Indian Energy Exchange, JL Morison, Jindal Stainless (Hisar), Kirloskar Pneumatic, Oil Country Tubular, Supreme Industries and Tata Metaliks.
These stocks will be in focus.
Wipro: India’s third-largest IT company Wipro reported over 20% decline in its consolidated profit to Rs 1,800.8 crore for the quarter ended 31 March 2018.
Fortis Healthcare: Manipal Health Enterprises has revised its offer for Fortis Healthcare yet again, raising the value to Rs 6,322 crore.
Indiabulls Real Estate: Indiabulls Real Estate reported a nearly 21-fold jump in consolidated net profit to Rs 1,648.3 crore for the quarter ended 31 March 2018.
IDFC Bank: IDFC Bank will raise up to Rs 5,000 crore by issuing bonds in next 12 months in one or more tranches.
Sterlite Tech: Sterlite Tech posted 77% rise in consolidated net profit to Rs 112.42 crore for the quarter ended 31 March 2018 on the back of high demand for optical fibre products in telecom networks.
ICICI Lombard General Insurance Company: ICICI Lombard General Insurance Co registered an 18% jump in net profit to Rs 212 crore for the quarter ended 31 March 2018.
Jindal Stainless: Jindal Stainless posted 28.7% decline in standalone net profit to Rs 114.74 crore for the Janurary-March period of the financial year 2017-2018.
UltraTech Cement: UltraTech Cement reported a consolidated net profit of Rs 446.13 crore for the fourth quarter ended on 31 March 2018.
Contra call: rare bull says rupee will gain on RBI raising rates, even as banks predict fall
The Reserve Bank of India will raise interest rates this year, which will help reverse the declines that have made the rupee Asia’s second-worst performer, according to Capital Economics Ltd. The rupee will strengthen to as much as 62 per dollar by the end of 2018, said Shilan Shah, a Singapore-based India economist. The bullish forecast comes amid a spate of cuts by analysts from banks including Standard Chartered Plc as rising oil prices and slowing capital inflows sour sentiment.
“We expect a hike in the policy rate in India, which will widen the interest-rate differential between India and its peers, including the U.S.,” Shah said. “We do also expect further tightening in the U.S. but this has already been priced into markets.”
The RBI may tighten policy as early as October, Shah said, with the main repurchase rate rising 75 basis points over the next year to 6.75 percent. The central bank brought forward rate-hike expectations last week by releasing unexpectedly hawkish minutes of its last meeting.
While higher borrowing costs tend to support the currency, that correlation doesn’t typically work in India, where foreign inflows into equities — an asset class sensitive to rate cuts — matter more. Bond investments by global funds are subject to limits, though there have been moves recently to ease the caps.
Australia & New Zealand Banking Group Ltd. and Malayan Banking Bhd. both said that a hawkish RBI doesn’t bode well for the rupee. The currency dropped to the weakest level in more than 13 months on Wednesday. “The possibility of an earlier or additional hike will be negative for INR,” ANZ analysts including Khoon Goh wrote in a note Tuesday.
India imports two-thirds of its crude needs and the spurt in oil prices has coincided with the slowdown in capital inflows. Foreigners have pulled $1.4 billion from its debt so far in 2018 amid hardening global yields, and this month turned net sellers of local shares. Elevated energy costs are a threat to the rupee, though Capital Economics expects crude to drop to $65 a barrel by year-end, Shah said. “These are concerns, but they will be allayed by tighter policy,” he said.
Ford freestyle launching in India: Figo-based cross hatch expected to be priced close to Rs 6 lakh
The new Ford Freestyle is set to be launched in the country. The Freestyle is the company’s first cross hatch and its bookings have already commenced across dealerships in India at a token amount of Rs 11,000. The Ford Freestyle comes based on the Figo but gets a beefed up appearance due to which it looks significantly muscular than the latter. The front grille of the new Ford Freestyle offers it a sportier look. The new Ford Freestyle gets power from a 1.2-litre petrol engine that is good for churning out respective power and torque outputs of 95 bhp and 120 Nm. Besides, there is also a 1.5-litre diesel engine on offer that sheds out a maximum power output of 99 bhp along with a peak torque of 215 Nm. Both the engines come mated to a five-speed manual transmission system.
TVS Sport silver alloy edition launched at a price of Rs 38,961: TVS’ most affordable bike sales cross 20 lakh units
The new TVS Sport Silver Alloy edition has just been launched in India. The TVS Sport silver alloy wheel edition will be available for sale in two colour schemes that go by the names Black Silver and Volcano Red. The company has launched the said special edition on the occasion of commemorating 20 lakh unit sales of the motorcycle. The price of the TVS Sport Silver Alloy edition has been kept at Rs. 38,961 (Ex-showroom, Madhya Pradesh). The TVS Sport is the most affordable motorcycle in the company’s stable. Powering the TVS Sport Silver Alloy edition is the same 99.7cc air-cooled engine that runs the standard model. The mill is good for churning out respective power and torque outputs of 7.5 bhp and 7.8 Nm. With this, the company claims a fuel efficiency of 95 km per litre.
Royal Enfield Interceptor 650 and continental GT 650 spotted with new, impressive colour options
Royal Enfield Interceptor 650 and Continental GT 650 have both been spotted with new paint jobs at a dealership in Australia. Revelry Cycles posted pictures on their Facebook page on the Royal Enfield twins. While the Interceptor INT 650 can be seen in a colour combination of red and white, the Continental GT 650 is seen in grey and black. These two are likely the colour options that will be available for the Interceptor and Continental GT apart from the colours that they were seen in during the launch. The Royal Enfield twins were introduced in India during Rider Mania in 2017 and are expected to launch in the country soon.
Royal Enfield Interceptor 650 and Continental GT 650 are both powered by a 648cc air-cooled, four-valve SOHC, fuel-injected parallel twin engine that makes 47 hp at 7100 rpm and 52 Nm of torque at 4000 rpm, and is paired with a six-speed gearbox.
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