Unlike equity market where one can buy/sell even one stock, derivatives are traded on minimum lot size basis with Rs 5 lakh as the minimum notional value.For example, in case of NIFTY futures, the current index of about 10,500 represents the notional value of one unit. With one lot comprising of 75 units,minimum exposure in NIFTY futures works out to about Rs 7.9 lakh. However, thetrader only needs to put-in the margin money, roughly around Rs 90,000 and not the entire amount.
Tata Motors recorded consolidated revenue of Rs 2.96 lakh crore in FY18 placing it is the league of biggest company in the country. However, the profits are rather unimpressive at just about Rs 9,000 crore. Standalone domestic business is going through even tougher times with the company accumulating losses of over Rs 8,000 crore during FY15-18. … Continue reading Corporate Analysis – Tata Motors
Among the points of contention between RBI and the government is market liquidity condition. While RBI says that there is enough liquidity in the market, government is not sure of that. Both have a point there. The enormity of the issue is evident from the fact that during September month alone, RBI transacted close to Rs 14 lakh crore to maintain liquidity. But how exactly does RBI manage liquidity and how is it different from managing money supply through monetary policy. Here is an attempt to understand RBI’s liquidity management operations.
Continue reading Analysing RBI’s Instruments for "Liquidity Management"
The process of withdrawal of United Kingdom from European Union has gained momentum with release of draft agreement about a week back. As per the current legal statute, UK would be out of EU on 29th March 19 and both the parties have to enter into a deal before that to avoid disruption to businesses and life, in general. Current trade between EU and UK stands at over $500 bn of goods trade, $235 bn of services and about $1.4 trillion of EU assets being managed by UK based financial services firms. Despite the pressure on British currency, EU also has a lot to lose from the exit. While the negotiations have not been as tough as anticipated and as nerve wracking as in the case of much feared Greek exit, fingers are still crossed. Here is a look at the economic aspect of the withdrawal and why an orderly withdrawal matters. Continue reading Operationalizing Brexit – What is at Stake??
The monetary policy committee’s decision today to keep the policy rate unchanged is not surprising. It could have done nothing else. However what is surprising and somewhat concerning is its comments on possibility of a rate cut. While the comment may look fair due to lower inflation, it is actually not so because the core … Continue reading Monetary Policy – Time to Remain Cautious…
Larsen & Toubro (L&T) is among the largest company in the country with consolidated revenue of Rs 1.2 lakh crore in FY18. It is also among those few companies which are professionally managed and not owned by a promoter/ promoter group. Company’s revenues have grown at over 12% CAGR over last ten years, not a … Continue reading Corporate Analysis – Larsen & Toubro
Steel industry has reported aggregate profits of Rs 11,000 crore in H1’19 against loss of over Rs 25,000 crore in FY18. The industry had been reeling under years of crisis which began with sharp rise in imports and got further aggravated with commissioning of large domestic capacities and increase in raw material prices. The current … Continue reading Industry Analysis – Steel Industry
NPAs of banks have again come into limelight with the declaration of quarterly results and discussions on how banks facing PCA can come out of the restrictions. As per latest estimates, gross NPA of banking sector stands at about Rs 10 lakh crore, somewhat stable for last two quarters. But where are the NPA coming … Continue reading NPAs – Sectoral Analysis