Vikram Pandit’s new efforts in India with Kampani’s JM Financial may get JM a 10% bump in stock quotes but it is unlikely that his 50% buy of the subsidiary and 490 million warrants worth 3% of the listed company with Hari Aiyar and wife in the new bank application at this stage will build … Continue reading
Yields on the 2022 bonds moved down 5 bp to 7.77% in pre policy trading and kept the gains as RBI announced the expected cut of 25 basis points in the Repo rate despite macroeconomic concerns in a bid to sledgehammer the supply side weaknesses that have disabled policy transmission and kept illiquid markets near … Continue reading
Markets sit on a big slip as they await the 11 AM announcement of policy rates and the afternoon meet the press with bankers. interestingly this is the closest to near unanimity in market expectations held together by all stakeholders including different institutional and brokerage based analyst teams on research and bank economists and … Continue reading
Of course, we are still correcting to a lower range and I would even think the market could now top out at 5850 which would be dangerous as that would probably break the market uptrend for good. While some of the unsure network analysts playing safe including Mitesh Thakkar on ET have opted for upticks … Continue reading
Though we did not suspect the political mulligatawny soup that will lead to a face off in the Parliament on the Lankan Tamils issue and should in fact be used by Indian polity to align to US on this issue and come down on belligerent China friendly Lanka, the very least done today in the political arena … Continue reading
Despite the political improbability of this being counted as a standoff by the understanding P Chidambaram, this will be the most advocated course by us as Indian Food inflation starts into gear and despite non Food inflation now being below 4% the banks’ predisposition to trust their models earning a good profit in such rate … Continue reading
Does Rao have room to cut rates Yesterday’s hawkish review ahead of today’s policy meeting and announcement was very clear about the CAD reaching 5.3% with another reduction in the Central Bank’s conservative GDP pronouncement. However, inflationary pressures have ebbed and since the Central Bank realises the importance of doing away with the spectre … Continue reading
As we mentioned, the markets had decided for the bank last week itself and while it was clear the rate cut was not recommended the market is in position to react unfavorably letting commentary focus on ”hawkishness” of the policy (just listen to LV on TV18 carrying on live from the dog and pony … Continue reading
indian equities started off a rally yesterday to upturn its nose to ratings agency S&P for daring to suggest India was closer to a downgreade two days before IIP announcements and a week before RBI policy is expected to be announced. Surprisingly, even naysayers, including us in this cycle who thought RBI need not cut … Continue reading
18000 Crores capital added by government $3.6 bln has been promised by MoF to fund state-owned banks immediately after the budget to facilitate ramping up the Tier I common/capital ratios on the FY2012 balance sheet. SBI was promised INR 1.6 bln or INR7800 crores ECB/FCCB funding welcome Meanwhile, the changed fortunes of the rupees could … Continue reading
Fixed Income yields keep falling off a cliff while liquidity is managed with the year long rally in yields chopped below 9% even as emergency liquidity’s few dollars keep bonds from staying east of the channel corridor mandated by RBI with the marginal lending facility currently at 9% for banks. The drop in yields could … Continue reading
Central Banks worldwide, our RBI included are busy providing Reserve Requirement cuts and Emergency liquidity mop ups to ensure inter bank market fluidity and avoid a situation like for Italy and Belgium, Spain and others last November in Europe. The ongoing Euro crisis is not just the cause of this drying up, but in fact … Continue reading
The 14% contribution of the food inflation may well bring cheer to the WPI number as Food caught a -3.36% score for the week ended December 24th to bring primary articles to 0.10% from a low 3% number last week and fuel remained suspended at 14.6% for another 25-30% of the basket. Everyuthing else in … Continue reading
It is clear that new found love for CDS has empowere India’s move into the mainstream Asian trading markets though RBI has made it clear it would not allow NBFCs to write CDS contracts or short or encourage any “default” underwritten by a CDS contract. This should be direct Net worth criteria instead of class … Continue reading
Bank of America on the other side and lately some banks here have started looking happier only on days when the market has crashed beyond expectations, making these a regular weekly feature of the market. Though Bank of america has been outwitted by the Euro and will bleed for more time, the india markets and its … Continue reading
Equities trading near lows, derivatives including the PCR has moved on to a low 1.05 showing that the down move in equities will be limited. However after Friday’s trading at 8.55% yields are already further down to 8.47% very encouraging to the RBI Governor to begin rate cuts in earnest and there in lies another … Continue reading
With inflation falling, the inverted yield curve ( 10 year yield a point below the short term 8.7% yield) could well be a good thing for india. the rupee depreciation could however keep imported inflation hot for India’s traders and manufacturers, esp as the Fuel basket is still up on the high ledge at 15.5% … Continue reading
Though a late market rally on Friday has taken away the gleam of an easy short for Monday, short covering in the last hour may also add to those planning to cap the trading range with a few swats with the bat. In bonds however, the easing of yields to 8.75% is not so certain either … Continue reading
With no changes to CRR and SLR, the RBI committed a dry 25 bp to its 500 bp hikes from February 2010, enumerating inflation expectations / liquidity as its key policy targets. The move is mild following market expectations of continuing rate hikes on the overnight rate. Also there is a commitment from the Guv … Continue reading
An almost vertical 33% rise in Sales to a $800 mln ( at a temporary $1=Rs 50 average) from $600 mln last year in September, and its exemplary 4.3% NIM at the Industry defining low LTV of 70% brought home HDFC a bonanza of chips in a game of consistent upending of Industry challenges with … Continue reading
..with so many idle hands on deck, exemplified not just by mid senior unemployment but also by a cash reserve of INR 4.7 Tln as studied by ET and a 200% rise over 2010 there is a lot of going back on the threatening tones adopted with RBI last month. With inflation at 10% levels … Continue reading
RBS had committed to HSBC towards the sale of all its 31 branches and 100 retail / wealth staff to HSBC. It is yet questionable if HSBC could have absorbed all 1800 staff which continues to operate as ABN AMRO in the country since License transfers are a throny issue that from the point of … Continue reading
The RBI proposal for making a 100% WOS structure mandatory for existing foreign licensees is likely to get the tax man’s blessings if the diktat comes through form the MoF letting Banks bring in unlimited Capital for the new banking company without any tax implications. It still leaves to the foreign banks to set up … Continue reading
Setting up the NBFC Banking Corporation Part II – The Infracos will find it tough but so will everyone else The infracos, REC, PFC and even IRFC if you believe the Financial Express have been tempted to start a Banking crporation and the current RBI chief Duvvoori Subbarao has been very clearly discouraging them. making their ask … Continue reading
I hate writing influencing stuff for these ‘namakool’ government people..a true laissez faire capitalist as bollywood would say today – but much as I like to disappoint wooden leg intelligentia (sorry Saugata, not you) and unfortunate colleagues who cannot see the depth and incisiveness of my decisions ( only some times, as most of my … Continue reading
