Date: 08 June 2009
GOOD MORNING
Thought for the day
“It doesn’t matter where you are coming from. All that matters is where you are going.”
–Brian Tracy
GENERAL
1) BJP nominee Karia Munda is all set to be the new Deputy Speaker of Lok Sabha with the ruling side as well as leaders of the other major groups extending support to him in the election for the post scheduled for Monday.
TOI
ECONOMY
2) With credit growth rate dropping to 15.8 per cent, Finance Minister Pranab Mukherjee will review the interest rate situation and discuss the targets and strategies to boost growth in advances during a meeting with public sector bank chiefs on Wednesday.
BS
3) UPA-II’s first Budget may bring some relief for individual taxpayers. The finance ministry is considering a proposal to hike the Rs 1-lakh limit for tax-deductible investments under Section 80C of the In-come Tax Act, 1961 by another Rs 50,000. This would allow individual taxpayers to invest up to Rs 1,50,000 of their earnings in long term saving products and claim tax deduction. An announcement to this effect is expected to be made in Budget 2009-10.
FE
CORPORATE / INDUSTRY
4) Green shoots of recovery have started to sprout on the landscape of India’s industrial output. It is now comfortably above the October 2008 low; though still marginally below the peak recorded in March 2008. The index of Industrial Production (IIP), the official gauge for industrial output, is now nearly 14 per cent above its low point and just a whisker (2 per cent) away from last year’s record reading. Among individual sectors, cement, power and consumer durables may be the first to get back to growth, as their output has either already matched last year’s highs or is just 5 per cent short of it.
BL
5) Wockhardt Hospitals is said to be looking at raising Rs 900-1,000 crore by selling some of its hospitals to rival Fortis Healthcare, sources said. There have been either reports about a possible stake by Wockhardt to Fortis, but the talks have now moved towards sale of a few hospitals, according to sources.
FE
MONEY & BANKING
6) CREDIT sanction by the banking industry, notably PSU banks, have registered 150% rise in the eight-month period since October 2008. This is expected to see further traction over the next quarter, according Union Bank of India (UBI) CMD MV Nair. “There has been an increase in sections across all lines including home loans, personal as well as corporate demand. However, there could be a number of reasons for the slow disbursements by PSU banks including a decision by the borrowers to defer capital expenditure but we expect things to reverse out,” he said.
ET
7) Signs of a possible bottoming out in industry on the supply side and private consumption on the demand side have prompted HDFC Bank to revise FY10 growth forecast upwards from 5.8 per cent to 6.5 per cent.
BL
INSURANCE
8)Mediclaim policy holders, who are not satisfied with the services of their existing insurance providers, will soon be able to switch to another firm easily, without any change in the premium outgo, the IRDA Chairman, Mr J Hari Narayan, said. There are lots of issues which are being sorted out by IRDA and the General Insurance Council, he told PTI.
BL
MARKETS
9) WITH 13 consecutive weeks of upsides, bulls have been showing some signs of fatigue. But market participants do not expect any major sell-off in equities this week unless the global trend turns bleak, as investors are awaiting the new government’s budget on July 3 to gain a sense on how it plans to revive the Indian economy. Investor expectations from the budget, with regard to announcements on pro-business policies are high, giving the market very little room for disappointments. This is especially true when the view among market participants is unanimous that India’s stock valuations are expensive vis-a-vis other emerging markets.
ET
10)The country’s top 10 firms added Rs 29,000 crore to their market capitalisation last week, with public sector trading firm MMTC contributing the major chunk. State-owned MMTC jumped to the fourth place in the club of top 10 firms and added Rs 33,201 crore to its market capitalisation, taking the total valuation to Rs 1,71,040 crore during the week ending June 5. Shares of the company surged 24% to settle at Rs 34,208.05 on the BSE at the end of Friday’s trade.
ET
11) The ongoing surge in the stock market has pushed the shareholders’ wealth past Rs 50,00,000 crore mark – in the process bringing in over one lakh new investors on-board in just one month. A total of about 120,000 new stock market investors opened their demat accounts, which is necessary to trade in equities, during the month of May, according to data available with the two depositories, National Securities Depository(NSDL) and Central Depository Services (CDSL). This has increased the total number of demat accounts in the country to over 15 million. The market experts believe that the inflow of a large number of new investors into the market could be attributed the sharp surge in the recent months as well as expectations for revival of the IPO market with some fundamentally-sound public issues by the government-run companies.
BS
12) Members of the Securities and Exchange Board of India(Sebi) have suggested a phased reduction of the securities transaction tax(STT) as part of a package of measures to develop the capital markets that was discussed with Finance Minister Pranab Mukherjee last week. Removing STT is considered necessary to improve retail participation in the capital markets by reducing transaction costs, sources close to the development said.
BS
IPO
13) THE government plans to list only two state-owned companies – Oil India (OIL) and National Hydroelectric Power Corporation(NHPC) – this fiscal even as it aims to mop up Rs 6,500 crore via disinvestments by the year-end, a finance ministry official said.
ET
COMMODITIES
14) Crude oil futures and gold futures on the national commodity bourses continued to gain some ground on the week ended Friday. Crude prices surged towards $70 per barrel on Thursday, recouping the previous oil trading session’s losses and leading a rally in many other commodities, such as spot gold and silver.
FE
REAL ESTATE
15)Enthused by improving market conditions, eight real estate firms including Unitech, Parsvnath and Sobha Developers are looking to raise more than Rs 25,000 crore together through sales of shares, mostly to foreign investors. After struggling for funds and soaring debt levels in the recent months due to a slump in property as well as financial markets, these firms are now looking to raise about Rs 3,000 crore by issuing convertible warrants to their promoters, while more than Rs 22,000 crore is intended to be raised from institutional investors such as FIIs.
ET
COMMUNICATIONS
16) A critical battle has been won for the telecommunications industry as the defence ministry has agreed to release 45 mega hertz(MHz) of spectrum, the radio frequency on which mobile phone signals travel. Out of this, 25 MHz is for 3G, or third generation of mobile services that enable high-speed data transfer, and the rest for 2G, the service prevalent in the country at present.
BS
INFORMATION TECHNOLOGY
17) INDIA’S second biggest software exporter Infosys Technologies plans to open a software development and back office centre in Brazil later this year, as the company seeks to serve its US customers better by establishing a nearshore presence.
ET
18) Wipro, India’s third-largest IT outsourcing company, is scouting the US market for talent to manage its growing consultancy business. The company is increasing headcount in the US, primarily in the banking and financial services consulting vertical.
BS
19)WAL-Mart Stores, the world’s largest retailer has shortlisted top Indian tech firms including TCS, Infosys and Wipro for an outsourcing contract potentially worth up to $500 million over the next few years, as the retailer seeks to award multiple contracts for managing its business applications and other back-office activities.
ET
20)IF third generation(3G) is the next big opportunity for domestic telecom operators, it is also expected to open a whole new business stream for IT companies. 3G integrates voice, data and video on a single platform that in turn allows video downloads and other applications that require high speed connectivity.
ET
INTERNATIONAL
21)Software czar and billionaire Bill Gates, too, is not immune to the economic downturn as the charitable organisation Bill & Melinda Gates Foundation launched by him, has seen its assets dwindle by over $9 billion in just one year. The assets of the foundation, co-chaired by three individuals, including Bill Gates and his wife Melinda Gates, fell to $29.89 billion for year ended December 31, 2008.
FE
22) JAPAN and China, the world’s second – and third-largest
economies,pledged on Sunday to throw their combined weight behind efforts to revive the struggling world economy, their delegation heads said. Both Asian economic giants also called for a resumption of stalled international talks to free up global trade and said they would for the first time launch joint assistance programmes for developing countries.
ET
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