The decision of Monetary Policy Committee to hold back rates while changing stance from “Neutral” to “Calibrated Tightening” looks a little complex. However, more complex and interesting is the reaction of the market which was expecting a rate hike. Instead of welcoming the pause decision, Sensex went down by almost 800 points! So, what explains this? How would markets have reacted if the policy rate was hiked? A bigger fall or could it have been a thumbs up?! A brief attempt to read today’s monetary policy..
Tata Steel has reported profit of about Rs 18,000 crore on consolidated revenue of over Rs 1.3 lakh crore in FY18. The performance is a strong revival for the company which had been making losses on its international businesses for several years. The company offers interesting management lessons, especially for young management professionals, not only … Continue reading Corporate Analysis – Tata Steel
The default by IL&FS has created a storm in the market like not seen for a long time. Despite the swift and proactive decision by the government to take over the management of IL&FS, the issue has become a systemic crisis not only affecting the NFBC sector but to an extent, the entire financial sector. … Continue reading What Ails NBFCs..?? (Part I)
The annual survey of industries covering total of 1.91 lakh factories shows an impressive increase of 10% in net profits for year 2015-16, latest available. The factories have total invested capital of over Rs 38.5 lakh crore as per the report released by Ministry of Statistics, Planning and Implementation (MOSPI) some time back. The survey is the … Continue reading Annual Survey of Industries – Government Report (Part I)
RBI’s monetary policy is dictated towards achieving a level of money supply which keeps inflation in check and still, leaves sufficient money to help economy grow. But there are different forms of money such as narrow money, broad money and reserve money. So, which form of money does the monetary policy control? And does that … Continue reading Money Supply – Understanding the Different Forms..
The continues depreciation of rupee against dollar has disturbed the currency market and trade balance. However, is the depreciation really that huge and is it that bad?? A look at the dynamics of the exchange rate and the factors impacting it… In a free market economy, markets are expected to auto-correct and if a currency … Continue reading Indian Rupee – Has it really depreciated??
Money market is witnessing lot of turmoil after the default by IL&FS with increased nervousness among the participants. This has resulted in higher redemption, even distress sales and so on leading to liquidity crisis further aggravating the situation. With average turnover of over Rs 6 Lakh crore daily, any uncertainly in the market is a … Continue reading Understanding the Dynamics of “Money Market”
IL&FS mess, credit quality and sectoral distribution of loan continue to occupy headlines. A fall-out of the reckless lending during FY08-14, leading to sharp rise in NPAs, is the sharp decline in bank credit growth and a dramatic shift in the sectoral distribution. The shift is so sharp that “Industries”, which received incremental credit of about … Continue reading Banking Loan Composition – An Overview..
The word “inflation” came into limelight again last week with monetary policy announcement amidst the surge in crude prices. But to what extent crude affect domestic prices? Does it impact both WPI and CPI equally? What are the other drivers of prices? An attempt to understand inflation, its constituents and its drivers… There are two … Continue reading Inflation – Analyzing its Constituents and Drivers
The chase to get Vijay Mallya back to India and face trial continues even though it is more than two years since he escaped from the country. While his individual offense will be deliberated upon by the Courts, the failure of KIngfishers Airline is an interesting and insightful case study. More so, since he had … Continue reading Vijay Mallya – The Chase Continues..!