Nifty November 2014 futures closed at 8380.10 on Thursday at a premium of 22.25 points over spot closing of 8,357.85, while Nifty December 2014 futures ended at 8426.95 at a premium of 69.10 points over spot closing. Nifty November futures saw contraction of 0.67 million (mn) units, taking the total outstanding open interest (OI) to 23.10 mn units. The near month derivatives contract will expire on November 27, 2014.
From the most active contracts, HDFC Bank November 2014 futures traded at a premium of 8.30 points at 922.30 compared with spot closing of 914.00. The number of contracts traded were 24,270.
Reliance Industries November 2014 futures traded at a premium of 4.85 points at 974.05 compared with spot closing of 969.20. The number of contracts traded were 17,447.
Hindalco Industries November 2014 futures traded at a premium of 1.00 points at 152.75 compared with spot closing of 151.75. The number of contracts traded were 17,559.
Axis Bank November 2014 futures traded at a premium of 2.00 points at 475.95 compared with spot closing of 473.95. The number of contracts traded were 14,864.
Tata Steel November 2014 futures traded at a premium of 1.25 points at 472.10 compared with spot closing of 470.85. The number of contracts traded were 31,983.
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Thursday 13 November 2014
Nifty November 2014 futures close at a premium of 22.25 points over spot closing price
Asian markets ended mixed on Thursday
Asian markets ended mixed on Thursday, amid signs that policy makers in China and Japan will do more to support economic growth. Chinese stocks rose in Hong Kong, propelling the benchmark index to its highest level in almost two months, after a report that central bank will inject cash into smaller banks. The People’s Bank of China is gauging city commercial banks’ demand for funds to support lending to small enterprises. Growth in China real estate investment slowed further in the first 10 months of 2014, but property sales showed some signs of improvement, indicating Beijing’s efforts to boost the ailing sector may be starting to have an effect. Property investment grew at its slowest pace in over five years between January to October, rising 12.4% from the same period a year earlier. That compared with a rise of 12.5% in the first nine months and was the slowest pace since July 2009.
Chinese Retail Sales fell to an annual rate of 11.5%, from 11.6% in the preceding month while Chinese Fixed Asset Investment fell to a seasonally adjusted 15.9%, from 16.1% in the preceding month. Chinese Industrial Production fell to 7.7%, from 8.0% in the preceding month. Japan’s industrial production rose to a seasonally adjusted 2.9%, from 2.7% in the preceding month.
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Oil crushing units start selling to foreign buyers via forward contracts
| The oil crushing units have started selling to foreign buyers via forward contracts, for delivery after December in anticipation of a further fall in oil meal prices. They expect a sharp jump in seed availability following the kharif crop harvest in the United States and other major producing regions. This is a positive indication for oil meal exporters. Through this, crushing units would be able to compensate part of their loss from edible oil sales. As per Solvent Extractors' Association (SEA) of India the average price of soybean meal was down 20% to $569 a tonne in September from $710 a tonne in May. Oil meal export fell 43% to 0.95 million tonnes (mt) in April-September, compared to 1.66 mt last year. The prime reason was a fall in export of soybean meal, by 87% to 111,027 tonnes as against 873,481 tonnes in the same period last year. The increase would be almost entirely on account of soybean. With a current forecast of 311 mt, global production would exceed the previous season's result by 10%. Preliminary forecasts for 2014-15 suggest a further improvement in the global supply and demand balance. For meals-cakes, a sizable surplus in supplies could push global inventories to historical highs. This, along with likely improvements in stock-to-use ratios, suggests considerable scope for international meal prices to soften further. In addition, further downward pressure could arise from abundant global supplies of feed grain. |
NSE Corporate Bonds Trading report
As per the NSE data, POWER FINANCE CORPORATION LTD. 9.81 BD 07OT18 FVRS10LAC LOA UPTO 06OT13, currently trading at Rs 103.5164 with Last Trade Yield (YTM) Annualized of 8.6900% was in maximum demand, followed by IDFC LIMITED SR-PP3/15 OPT II 8.9905 NCD 15JU15 FVRS10LAC, trading at Rs 100.1849 with YTM Annualized of 8.4296%, NTPC LIMITED SR-53 9.17 LOA 22SP24 FVRS10LAC, trading at Rs 103.7943 with YTM Annualized of 8.5700% and POWER FINANCE CORPORATION LTD. 8.27 BD 25JU16 FVRS10LAC LOA UPTO 19JN13, trading at Rs 99.3766 at a YTM of 8.6300%.
Indian railways identifies 17 areas for 100% FDI
In a move to bring major investments in railway infrastructure, Indian railway has indentified 17 special areas where 100% Foreign Direct investments (FDI) would be permitted. According to the guidelines approved by the government under its FDI policy, 100% FDI would be permitted in facilities like cleaning up trains and installation of bio-toilets in passenger coaches and setting up of mechanized laundry facilities. A committee constituted by Railway Ministry, to finalise the policy has also suggested a set of business models to attract investments in railway sector, is facing a severe cash crunch to the tune of Rs 30,000 crore every year.
Besides bio-toilets, cleaning operation and mechanized laundries, the areas identified by the committee for FDI include construction, maintenance and operation facilities to supply non-conventional sources of energy to the Railways, installation and maintenance of bio-toilets in passenger trains, setting up of technical training institutes, testing facilities and laboratories and providing technological solutions to improve safety.
Furthermore, the committee has suggested three business models for high-speed train projects including projects where there are limits on operations and a firm wants to invest in upgrading the existing rail network for speed above 120 km per hour or semi-high speed network. In dedicated freight lines, the Railways has permitted operations by investors, subject to certain conditions. The government has now allowed investment in dedicated freight lines on a Joint Venture and/or PPP model, with clear revenue sharing guidelines. All new suburban corridor projects are permissible when launched through PPP route by MoR. The developer can construct, maintain and operate the corridor within the concession period. It is expected that these new guidelines can attract upto Rs 90,000 crore FDI into Indian Railways.
Ever since its origin, Indian Railways had always been shut off from receiving any kind of FDI, considering security risks involved. However, in August this year, the government had eased FDI norms permitting 100 percent investment in rail projects, such as high-speed trains, suburban service, dedicated freight corridors, freight and passenger terminals. FDI is also being permitted for rail route electrification, signalling system and logistics parks.
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Cardamom futures edge up on good buying support
Cardamom futures traded higher on MCX on account of good buying support from both exporters and upcountry buyers and also on hopes of improved export demand. Further, tight stocks position in the physical market on restricted arrivals from producing belts of Chandausi in Uttar Pradesh too supported cardamom prices' uptrend.
The contract for November delivery was trading at Rs 765.00, up by 2.97% or Rs 22.10 from its previous closing of Rs 742.90. The open interest of the contract stood at 59 lots.
The contract for December delivery was trading at Rs 863.50, up by 0.02% or Rs 0.20 from its previous closing of Rs 863.30. The open interest of the contract stood at 1209 lots on MCX.
Call rates remain above repo level on Thursday
Interbank call rates were trading higher at 8.10%/8.15% against Wednesday’s close of 7.40%/7.50%, above the repo level on concerns over availability of funds due to a nationwide bank strike called on Wednesday. However, the rates are expected to ebb below repo level once banks resume their normal operations.
The banks via Liquidity Adjustment Facility (LAF) borrowed Rs 15688 crore through three days repo auction on November 13, 2014, while banks via LAF facility borrowed Rs 17849 crore through repo window and parked Rs 4289 crore through reverse repo auction on November 12, 2014.
The overnight borrowing rates touched a high and low of 8.40% and 7.90% respectively.
According to the Clearing Corporation of India (CCIL), the weighted average rate (WAR) in the call money market was at 8.09% on Thursday and total volume stood at Rs 26686.47 crore, so far.
As per CCIL data, WAR in the CBLO (Collateralized Borrowing and Lending Obligation) market was at 8.15% on Thursday and total volume stood at Rs 49645.30 crore, so far.
The indicative call rates which closed 7.40%/7.50% on Wednesday were contributions made from Andhra Bank, AXIS Bank, Bank of America, Bank of Baroda, Bank of India, Canara Bank, J P Morgan Chase, Citibank N.A., Corporation Bank, Credit Agricole Bank, Indusind Bank, ICICI Bank, ICICI Securities, IDBI Bank, Jammu and Kashmir Bank, Punjab National Bank, RBS, Societe Generale, Standard Chartered, so far.
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United Spirits inches up on plan to sell land, treasury shares to reduce debt
United Spirits is currently trading at Rs. 2722.90, up by 0.50 points or 0.02% from its previous closing of Rs. 2722.40 on the BSE.
The scrip opened at Rs. 2724.00 and has touched a high and low of Rs. 2748.85 and Rs. 2710.00 respectively. So far 27492 shares were traded on the counter.
The BSE group 'B' stock of face value Rs. 10 has touched a 52 week high of Rs. 2940.55 on 15-Apr-2014 and a 52 week low of Rs. 2226.00 on 05-Sep-2014.
Last one week high and low of the scrip stood at Rs. 2748.85 and Rs. 2526.05 respectively. The current market cap of the company is Rs. 39529.15 crore.
The promoters holding in the company stood at 58.87% while Institutions and Non-Institutions held 27.60% and 13.05% respectively.
In a bid to pare its huge debt of Rs 7,600 crore, Liquor maker United Spirits (USL) has lined up a number of measures, including selling treasury shares and surplus land and properties. The company’s board has approved the plan to monetize surplus assets.
The company is planning to offload a substantial number of treasury shares of both itself and those of United Breweries held by USL. However, the treasury shares of USL are stuck in litigation with a bank and it is expected to take a few more months before the issue is settled.
United Spirits is the largest spirits company in India and a flagship entity of $2 billion UB group. It manufactures wide range of whisky, vodka, rum and other spirits.
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Rupee erases early gains; good macro-economic data limit the fall
Indian rupee, after making a good start, has lost ground and is currently trading weak against dollar on Thursday on bouts of dollar demand from importers on the back of bullish US currency overseas. However, sharp depreciation of Indian currency has been limited on account of good macro-economic data. In a double delight, India’s consumer price inflation eased to another all time low level since the launch of the new series of Consumer Price Index in 2012, at 5.52% in October as compared to 6.46% in September, while India’s annual industrial output growth, measured by index of industrial production (IIP), expanded more than expected at 2.5% in September after posting growth of 0.5% in August. On the global front, dollar took time out from its rally against the yen and euro on Thursday as traders awaited Chinese and U.S. data for fresh catalysts, while the Australian dollar slid after a central bank official said an intervention on the currency has not been ruled out.
The partially convertible currency is currently trading at 61.54, little weak from its previous close of 61.52 on Wednesday. The currency touched a high and low of 61.57 and 61.48 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 61.47 and for Euro stood at 76.78 on November 12, 2014. While, the RBI’s reference rate for the Yen stood at 53.43, the reference rate for the Great Britain Pound (GBP) stood at 97.9230. The reference rates are based on 12 noon rates of a few select banks in Mumbai.
India Cements surges on getting nod to raise Rs 500 crore
The India Cements is currently trading at Rs. 110.00, up by 1.80 points or 1.66% from its previous closing of Rs. 108.20 on the BSE.
The scrip opened at Rs. 109.85 and has touched a high and low of Rs. 112.05 and Rs. 108.55 respectively. So far 358676 shares were traded on the counter.
The BSE group 'A' stock of face value Rs. 10 has touched a 52 week high of Rs. 134.30 on 22-Sep-2014 and a 52 week low of Rs. 46.00 on 30-Jan-2014.
Last one week high and low of the scrip stood at Rs. 116.80 and Rs. 106.60 respectively. The current market cap of the company is Rs. 3389.72 crore.
The promoters holding in the company stood at 28.23% while Institutions and Non-Institutions held 48.12% and 22.01% respectively.
India Cements has received an approval to raise Rs 500 crore through issue of QIP / FCCB / GDR / other securities, subject to the approval of the shareholders and other appropriate authorities. The company’s board gave approval for the same at its meeting held on November 12, 2014. The company’s board has also approved proposal for delisting of equity shares of the company from Madras Stock Exchange.
Recently, the company reported a net profit of Rs 7.49 crore for the quarter under review as compared to a net loss of Rs 22.53 crore for the same quarter in the previous year. Total income of the company increased marginally by 3.84% at Rs 1135.85 crore for Q2FY15 as compared Rs 1093.88 crore for the corresponding quarter previous year.
India Cements is largest manufacturer of cement in South India. India Cements owns 28% of the market share and is leader in south India. The cement manufacturer aims 35% market share. It has distribution network of 10,000 stockists.
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Jaiprakash Associates reports net loss of Rs 106.48 crore in Q2 FY15
Jaiprakash Associates has reported results for the second quarter ended September 30, 2014.
The company has reported a net loss of Rs 106.48 crore for the quarter as compared to a net profit of Rs 67.67 crore for the same quarter in the previous year. Total income of the company has decreased by 17.06% at Rs 2736.91 crore for quarter under review as compared to Rs 3300.21 crore for the quarter ended September 30, 2013.
Jaypee Group is the country’s third largest cement maker. Swiss major Holcim owns majority stake in both ACC and Ambuja Cement with a combined capacity of around 52 mtpa in India.
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NALCO trades jubilantly on reporting 91% rise in Q2 net profit
National Aluminium Company (NALCO) is currently trading at Rs. 62.50, up by 3.85 points or 6.56% from its previous closing of Rs. 58.65 on the BSE.
The scrip opened at Rs. 63.00 and has touched a high and low of Rs. 64.30 and Rs. 62.00 respectively. So far 755622 shares were traded on the counter.
The BSE group 'A' stock of face value Rs. 5 has touched a 52 week high of Rs. 68.80 on 19-Sep-2014 and a 52 week low of Rs. 31.80 on 20-Feb-2014.
Last one week high and low of the scrip stood at Rs. 64.30 and Rs. 58.25 respectively. The current market cap of the company is Rs. 16159.29 crore.
The promoters holding in the company stood at 80.93% while Institutions and Non-Institutions held 13.36% and 5.71% respectively.
National Aluminium Company has registered 90.61% rise in its net profit at Rs 341.52 crore for the quarter under review as compared to Rs 179.17 crore for the same quarter in the previous year. Total income of the company has increased 16.28% at Rs 2164.13 crore for Q2FY15 as compared Rs 1861.07 crore for the corresponding quarter previous year.
NALCO has the largest integrated alumina-aluminium complex of Asia. Its integrated operations cover the entire aluminium production value chain from mining bauxite, refining alumina, smelting aluminium, captive power generation to a strong logistic network in terms of rail & port facilities, coal mining and handling plant to support its operations and to become one of the most cost-efficient aluminium companies across the globe.
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Gold futures decline as dollar strengthens
Gold futures declined on Wednesday as the dollar trended higher against a basket of major currencies. Furthermore, growing speculation about US interest rate hikes happening sooner than expected also weighed on the precious metal price.
Gold futures for December delivery settled down $3.90 at $1,159.10 an ounce on the Comex division of the New York Mercantile Exchange. While spot gold fell 0.5 percent at $1,158.40 an ounce.
Deutsche MF introduces Fixed Maturity Plan - Series 82 (1100 days)
Deutsche Mutual Fund has launched the New Fund Offer (NFO) of Deutsche Fixed Maturity Plan - Series 82 (1100 days), a close ended income scheme. The NFO opens for subscription on Nov 13, 2014 and closes on Nov 17, 2014. No entry load or exit load will be applicable for the scheme. The minimum subscription amount is Rs 5,000.
The scheme’s performance will be benchmarked against CRISIL Composite Bond Fund Index and its fund manager is Rakesh Suri.
The investment objective of the scheme is to generate income by investing in debt and money market instruments maturing on or before the date of the maturity of the Scheme.
October CPI inflation eases to another all time low of 5.52%
In an encouraging development for the economy, India’s consumer price inflation eased at another all time low level since the launch of the new series of Consumer Price Index in 2012, at 5.52% in October as compared to 6.46% in September, helped by the lower prices of food and fuel. The numbers were way lower than street expectation of a figure above ‘5.60%’.
The General Indices for rural, urban and combined stood at 147.2, 142.6 and 145.2 respectively. The corresponding provisional inflation rates for rural and urban areas for the month under review stood at 5.52% and 5.55% as compared to 6.68% and 6.34% respectively in the previous month.
Retail Inflation for the month under review declined mainly on account of food inflation. The vegetable price inflation lowered significantly to -1.45% versus 8.59% in September. The newly introduced CFPI of October, 2014 for rural, urban and combined stood at 152.1, 149.2 and 151.2 respectively.
Inflation of food and beverages (combined), with 59.31% weigtage of the index, receded to 5.68% as against 7.56% in September. Besides, Fuel and light prices, with 10.42% weightage in the index ebbed to 3.29% on a yearly basis, 3.45% in September, additionally, inflation in clothing, bedding and footwear eased to 7.45% in month under review against 7.59% in September. Core inflation, which denotes prices for non-food and non-fuel items, came in at 5.85% compared to 5.9% in the previous month.
The decline in retail inflation strengthens the case for interest rate cuts by the Reserve Bank of India, as the RBI has set a target of bringing inflation down to 8% by January 2015 and 6% by January 2016. However, Governor Raghuram Rajan has admitted to upside risks on the latter target.
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TCS features as Leader by HfS Research in Retail BPO
Tata Consultancy Services (TCS), a leading IT services, consulting and business solutions organization, has been recognized in the ‘Winner’s Circle’ among the top worldwide Retail BPO service providers by the analyst firm HfS Research in its ‘Blueprint Report on Retail BPO Services’.
The HfS Blueprint identifies several key differentiators between service providers, placed in the ‘Winner’s Circle’ for their demonstrated excellence in execution and innovation. From an execution perspective, these providers have developed strong client relationships and real-world delivery solutions and are flexible in meeting clients’ needs. Innovation represents providers’ strong vision, plans to invest in future capabilities and the ability to leverage external drivers to increase value for their clients.
TCS is an IT services, consulting and business solutions organization that delivers real results to global business, ensuring a level of certainty no other firm can match. TCS offers a consulting-led, integrated portfolio of IT, BPO, infrastructure, engineering and assurance services.
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US markets closed mostly lower; S&P, Dow halts winning streak
The US markets closed mostly lower on Wednesday, with the S&P 500 and Dow Jones Industrial Average snapping a 5-day record-closing streak. The small-cap shares however rose to the highest level since July, as gains among phone and consumer stocks offset losses in utilities. Concerns that European struggles may weigh on the US economy were stoked after Bank of England Governor Mark Carney unveiled lower UK growth and inflation forecasts as officials adjusted to account for moribund global expansion and stagnation in Europe. The US Federal Reserve is also investigating possible improper conduct in foreign exchange markets by large banking institutions. On the economy front, US wholesale inventories rose by 0.3% in September, matching the consensus forecast. Inventories of durable goods, such as autos and machinery, rose 0.8%. Meanwhile, inventories of nondurable goods fell 0.6%. Wholesale sales rose 0.2% in September, following a 0.8% drop in August. At September’s sales pace, the inventory-to-sales ratio remained at 1.19. For August inventory growth was revised to 0.6% from a prior estimate of 0.7%.
Dow Jones Industrial Average lost 2.70 points or 0.02 percent to 17,612.20, S&P 500 ended lower by 1.43 points or 0.07 percent to 2,038.25, while Nasdaq was up by 14.58 points or 0.31 percent to 4,675.14.
The Indian ADRs closed mostly in green on Wednesday; Tata Motors was up 0.83%, ICICI Bank was up 0.74%, Dr. Reddy’s Lab was up 0.50% and HDFC Bank was up 0.15%. On the other hand, Infosys was down 0.04%.
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IOC, NMDC and Infosys to see some action today
The board of Indian Oil Corporation (IOC) recently approved the Rs 5,150-crore Ennore LNG terminal project to the north of Chennai. The work on the 5-million-tonne Liquefied Natural Gas terminal, the first such infrastructure on the east coast, will start in a couple of months. IOC has appointed Foster Wheeler of Spain as the project management consultant. IOC hopes to complete the project by 2018. The company is also participating in the bids called by the Petroleum and Natural Gas Regulatory Board for laying pipeline for the project linking the terminal to Tiruchi, Nagapattinam and Madurai in South Tamil Nadu apart from lines to Chittoor and Bangalore.
State-run NMDC-led consortium is planning to buy 30 percent stake in the Russian potash firm Acron, which may result in an investment of around Rs 1,000 crore. Rashtriya Chemicals and Fertilizers (RCF), National Fertilizers (NFL), Fertilizers and Chemicals Travancore (FACT) and Fertiliser Cooperative Kribhco are the four other entities which are part of this consortium. Along with purchasing 30 percent stake, the consortium is also looking to enter into an off take agreement for import of Potash from the Russian firm. At present, National Mines Development Corporation (NMDC) is conducting a feasibility study on this proposal.
Infosys wants the revenue generated by each employee to go up by 2016, on the back of new initiatives around big data, design thinking and a renewed push on automation. Revenue per employee at Infosys currently stands at around $50,000, the highest in the industry. Non-linear revenue growth, which refers to an increase in overall sales without a proportional addition to the headcount, has been the holy grail of the Indian IT industry. Infosys has already bagged 40 projects around big data and predictive analyses in the last two months. Infosys is able to provide this service by developing a new data processing platform built on open source technology. The company has also partnered with Stanford’s Institute for Computation and Mathematical Engineering for data scientists who can work with Infosys’ teams.
State-owned term lender IFCI is planning to sell its stake in three companies, including National Stock Exchange (NSE). The board has already given in-principle approval for sale of 2.5 percent stake in NSE. IFCI at present holds 5.44 per cent stake in the premier bourse. Besides, the company also wants to sell its stake in IFCI Factors and IFCI Financial Services. The company plans to sell 25-26 percent stake in IFCI Factors so that the majority stake remains with IFCI, adding the strategic sale would help IFCI unlock its investment. The company holds 100 percent stake in IFCI Factors.
Mobile tower company Bharti Infratel has approached Vodafone and Idea Cellular to buy their mobile towers in seven out of 22 telecom circles in the country. Infratel has over 36,381 standalone mobile towers spread across 18 states under 11 telecom circles. The company also has a 42 percent stake in Indus Towers- joint venture between Bharti Infratel, Vodafone and Aditya Birla Telecom. The states where Bharti Infratel has no overlapping business with Indus includes, Jammu and Kashmir, Himachal Pradesh, Madhya Pradesh, Chattisgarh, Bihar, Jharkhand, Odisha, Assam and North Eastern states. These states jointly come under 7 telecom circles.
The battle to grab high-end consumers in Mumbai has escalated as government-owned Brihanmumbai Electric Supply & Transport Undertaking (BEST) now plans to approach the Supreme Court to inhibit Tata Power from cherry-picking valued customers in Mumbai. BEST, which charges the highest tariff in the city, had earlier approached the state and the central power regulators. It plans to increase rates by 14% to 16% from April. The company buys the bulk of its power requirement of close to 932.5 MW from Tata Power despite their rivalry. On August 14, the MERC had issued a distribution license to Tata Power expanding its network of operations to include Mumbai, which was previously only served by BEST.
Apollo Hospitals Enterprise has reported a 6 percent increase in net profit to Rs 92 crore as against Rs 87 crore in the corresponding quarter last year. Revenue increased by 18 percent to Rs 1,153 crore (Rs 975 crore). During the quarter, the company has made progress in expanding its network of hospitals, pharmacies and retail healthcare centres. The company’s arm - Apollo Pharmacies added 61 stores and closed eight stores for a net addition of 53 stores. The total store network as on September 30 stands at 1,717 operational stores.
Amtek Auto, a diversified New Delhi-based auto component manufacturer, plans to diversify into new areas such as aerospace, railways and oil and gas by utilizing its core forging and casting business. The $2.7-billion Amtek Group will continue to maintain its main focus on the automotive industry, but is looking at synergies with other areas to harness growth potential. The group manages 65 production facilities across several countries. The casting and forging facilities for manufacturing automobile parts can also be used for making custom fittings, valve bodies and other components used in the oil industry.
Mobile telecom operator Aircel has partnered with Reliance Communications (RCom) to launch high-speed 3G services in the lucrative Mumbai circle. Aircel’s 3G services will offer enhanced user experience to subscribers, allowing them live streaming of various content and better access to social media. The company won 3G spectrum in 13 circles for nearly Rs 6,500 crore, which does not include Mumbai, where Bharti Airtel, Reliance and Vodafone emerged as winners. Under revised guidelines, operators are allowed to tie up with their peers and launch services in circles they do not have a license.
Factory output grows sharper than expected at 2.5% in September v/s 0.5% in August
India’s annual industrial output growth, measured by index of industrial production (IIP), expanded more than expected at 2.5% in September after posting growth of 0.5% in August. The cumulative growth for the period April-September 2014-15 over the corresponding period of the previous year stands at 2.8%.
On sectoral basis, growth of electricity index, which occupies 10.32% weightage in the overall index, grew at a slower pace by 3.9% in the reported month as against 12.9% in August, while mining sector output growth too slowed down to 0.7% as compared to 2.6% growth in the previous month. On the flip side, the output of manufacturing sector, which occupies 75.52% weightage in the overall index, grew by 2.5% in September from a growth figure of 12.9% in August.
The cumulative growth of Mining, Manufacturing and Electricity sectors during April-September 2014-15 over the corresponding period of 2013-14 stood at 2.1%, 2.0% and 10.4% respectively. On Use-based classification, capital goods production, a barometer for investments in the economy grew by 11.6% for the month under review .The output of basic goods sector grew by 5.1% as against 9.6% in August, while consumer non-durables output grew by 1.5% in September as compared to -0.9% in the previous month. The output of consumer durables sector continued its contraction though with a slower pace, declining by 11.3% in month under review as compared to massive contraction at 15.00% in August, indicating that consumers are reeling under high inflation which is impacting their spending.
This data is definitely a heartening development for Narendra Modi government, which is looking to revive the economy and has taken slew of measures, like deregulating diesel prices, linking gas prices to global benchmarks, amendments to labour policies towards this. Notably, this another piece of reading which strengthens the case for rate cut by RBI In its upcoming monetary policy in December after India’s consumer price inflation eased at another all time low level since the launch of the new series of Consumer Price Index in 2012, at 5.52% in October as compared to 6.46% in September, helped by the lower prices of food and fuel.
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