India’s CAD to be contained below $60 billion this financial year

Finance Minister P Chidambaram has exuded confidence that India’s current account deficit (CAD) will be contained below $60 billion this financial year as against an earlier estimate of $70 billion. The CAD, the difference between the inflow and outflow of foreign exchange, had touched an all-time high of $88.2 billion, or 4.8% of GDP, in the last fiscal.

Gold imports were one of the major reasons that pushed CAD to a record high in the previous financial year. While, slew of efforts this time around have been taken by India’s apex bank and government to curb gold import and thereby narrow down CAD. So far in 2013, RBI restricted gold imports on a consignment basis by banks. A transaction tax of 0.01% was imposed on non-agricultural futures contracts including precious metals. Besides, India's biggest jewellers' association asked members to stop selling gold bars and coins, and the import duty on gold was raised to 10 %.

Chidambaram further underscored that both Reserve Bank of India and government were prepared to deal with impact of US Federal Reserve’s gradual stimulus withdrawal and assured that number of measures were being taken so that the event of tapering does not takes the market by surprise and just has minimal impact.

Dabur shines on unveiling ‘Real Fruit Shakes’

Dabur is currently trading at Rs. 174.25, up by 1.25 points or 0.72% from its previous closing of Rs. 173.00 on the BSE.

The scrip opened at Rs. 172.25 and has touched a high and low of Rs. 174.45 and Rs. 171.35 respectively. So far 32,000 shares were traded on the counter.

The BSE group 'A' stock of face value Rs. 1 has touched a 52 week high of Rs. 184.90 on 28-Oct-2013 and a 52 week low of Rs. 120.90 on 23-Nov-2012.

Last one week high and low of the scrip stood at Rs. 181.30 and Rs. 172.05 respectively. The current market cap of the company is Rs. 30,385 crore.

The promoters holding in the company stood at 68.63% while Institutions and Non-Institutions held 24.67% and 6.70% respectively. Dabur India has entered into the packaged milk shake market with the launch of Real Fruit Shakes under the brand Real. This also marks brand Real extending its fruit expertise into milk-based drinks. Real Fruit Shakes has been test launched with a single variant - Mango Shake and will be offered to consumers in two SKUS - 200ml for Rs 25 and 1litre for Rs 105.

Rupee sheds 30 paise to 61.93/dollar

The rupee weakened by 30 paise at 61.93 to the dollar against the previous close of 61.63 on fresh dollar demand from banks and importers.

On Tuesday, the domestic unit strengthened due to large inflows from a telecom company and dollar selling by foreign banks.

Abhishek Goenka, Founder and CEO, India Forex Advisors, said since the past three consecutive sessions, it has been observed that the rupee opens on a weak note but ends the day on a strong note.

According to dealers, the expectation that RBI may wind down the special forex swap window for oil marketing companies will weigh on the rupee.

Call rates, G-secs

The overnight call money rate, the rate at which banks borrow from each other for their short-term funding requirements, opened sharply higher at 8.25 per cent against the previous close of 7 per cent.

Yield on the 10-year benchmark 7.16 per cent 2023 government bond hardened to 8.75 per cent from its previous close of 8.73 per cent. Bond prices opened lower at Rs 89.8 from Rs 89.95.

Crude oil jumps ahead of US stockpiles report

Oil prices rose in Asian trade today but faced pressure from US demand fears and speculation over the future of the Federal Reserve’s stimulus programme, analysts said.

New York’s main contract West Texas Intermediate (WTI) crude for December delivery gained 41 cents to $93.78 a barrel in mid-morning Asian trade, after sinking $1.25 to close at a five-month low in New York.

Brent North Sea crude for December climbed 45 cents to $105.78.

“Investors will be closely watching the EIA (Energy Information Administration) stockpile numbers out later Wednesday that is likely to show a further supply surge in the US internal market,” David Lennox, resource analyst at Fat Prophets in Sydney, said.

“Investors have gotten somewhat used to the high stockpile numbers in the US, but we have also seen the WTI come off weaker when there is a drastic increase, such as immediately after the summer driving season.”

Crude inventories

The EIA is expected to report US supplies increased 1.9 million barrels in the week ending November 1, according to analysts polled by Dow Jones Newswires.

Inventories in the United States have risen for the past six weeks, to about 28 million barrels, raising concerns about oversupply in the world’s largest economy and top crude consumer.

Lennox added that market was also looking ahead to Thursday’s release of US third-quarter gross domestic product (GDP) advanced estimates.

The result will give investors a better idea about the Fed’s plans for its stimulus programme, with strong growth expected to tilt the bank towards an earlier wind down.

TCS gains as Zions Bancorporation selects 'TCS BaNCS' for core banking transformation

TCS is currently trading at Rs. 2074.00, up by 31.95 points or 1.56% from its previous closing of Rs. 2042.05 on the BSE.

The scrip opened at Rs. 2062.00 and has touched a high and low of Rs. 2087.00 and Rs. 2060.00 respectively. So far 12,000 shares were traded on the counter.

The BSE group 'A' stock of face value Rs. 1 has touched a 52 week high of Rs. 2258.05 on 15-Oct-2013 and a 52 week low of Rs. 1197.60 on 18-Dec-2012.

Last one week high and low of the scrip stood at Rs. 2140.80 and Rs. 2031.85 respectively. The current market cap of the company is Rs. 4,06,054.00 crore.

The promoters holding in the company stood at 73.96% while Institutions and Non-Institutions held 21.67% and 4.37% respectively.

Zions Bancorporation, one of America's premier financial services companies, has selected TCS BaNCS for its core banking transformation program to achieve standardization, centralization and straight through processing across the enterprise. In addition to the cost-saving benefits, the ability to have a single, 360 degree view of its end-user customers is a key focus of the core replacement program. TCS BaNCS is a core banking software suite developed by Tata Consultancy Services for banks, capital market firms, insurance companies and diversified financial institutions.

The depth of TCS BaNCS’ capabilities, its implementation track record and overall quality of banking and technology experts were among the major factors that influenced this selection by Zions Bancorporation, which consists of a collection of great banks in select Western US markets with combined total assets exceeding $50 billion. The transformation will be completed in phases, with Zions’ management expecting significant improvements in operational efficiency and customer experience, and reduced operational and financial risk stemming from older legacy systems.

Sensex trading marginally in the green

The market has opened marginally higher. The Sensex is up 25.41 points at 21000.20, and the Nifty up 7.40 points at 6260.55. About 244 shares have advanced, 85 shares declined, and 7 shares are unchanged. Technology stocks are gaining today on the back of peer company Cognizant's better than expected September quarter results.

 The company reported Q3 revenues at USD 2.31 billion, a growth of 6.7 percent sequentially and 21.9 percent compared to the same quarter last year. TCS , Wipro and Infosys are up around 1-2 percent. Cipla and Reliance are other gainers in the Sensex. On the losing side are Bajaj Auto , HUL , Sun Pharma , HDFC and BHEL . Indian rupee weakened by 38 paise in early trade on Wednesday. It has opened at 61.99 per dollar as against previous day's closing 61.61 per dollar. The US dollar maintained a bid tone early in Asian trade after upbeat US economic data kept alive some expectations that Federal Reserve might scale back stimulus as soon as next month.

 According to NS Venkatesh of IDBI Bank , currency markets will take cues from stock market movements. "Although we are witnessing some dollar inflows from exporters and custodian banks, rupee will see a weakening bias. Earlier than expected close of the RBI swap window could have an impact on dollar rupee movement in the medium term," he adds. "The range for the day is seen between 61.50-61.90/USD," Venkatesh says. In the US, markets slipped with Wall Street pausing after a two-session rise, as data showing the US services industry expanded more-than-expected in October offset softer economic headlines from Europe. The CBOE volatility index though held steady just above 13.
 In Asia, investors digested minutes from the Bank of Japan's meeting earlier this month. The yen weakened to 98.55 per dollar in early trade, which helped to underpin gains. It has been three weeks since the currency last touched regain the key 99 level. In commodities, Nymex prices hit a fresh four-month low pressured by forecasts for rising supplies and continued weak demand as Gulf Coast refineries were expected to remain offline at least through the end of this week. From precious metals space, gold struggled to shake off its longest losing streak in nearly six months as doubts persisted over when the US central bank would begin scaling back its stimulus measures.

FDI in Indian services sector decline by 47.5% to $1.19 billion during Apr-Aug’ 2013

Foreign Direct Investment (FDI) into the country’s services sector has declined by 47.5 percent to $1.19 billion during the April-August period of 2013 as compared to $ 2.28 billion in the same period last year mainly due to the declined outsourcing business of India on the back of the various restrictions put by developed economies.  Indian services sector, which includes banking, insurance, outsourcing, R&D, courier and technology testing, represent around 60% share in the country’s GDP. During the 2012-13, foreign investment in the segment fell by 7 percent to $ 4.83 billion from $5.21 billion in 2011-12.

In spite of the government various efforts to increase FDI, during April-August, 2013 has declined, reflecting the need to take more steps to improve the business environment in the country. Overall, FDI during the April-August period of 2013-14 has grown by a marginal 4 percent to $8.46 billion, from $8.16 billion in the first five months of 2012-13.

FDI is considered crucial for economic development of a country and to attract maximum FDI into the country, the government has been relaxing the foreign investment norms in various sectors. Recently, the government has also started exercise in allowing FDI in railways sector besides liberalising FDI norms for construction and housing sector. It is also considering raising the FDI cap in the insurance sector to 49 percent from 26 percent. Meanwhile, India needs around $1 trillion in the 12th five year plan (2012-2017), to overhaul its infrastructure sector such as ports, airports and highways to boost growth.

State Bank of India opens new branch at Kukatpally in Andhra Pradesh

State Bank of India (SBI), the country’s largest public sector bank has opened a new branch at Kukatpally Housing Board Colony in Andhra Pradesh. With this new branch, SBI has 1,352 branches in the state. Recently, the bank has received its board's approval for infusion of capital funds to the tune of Rs 2,000 crore in the bank by way of preferential allotment of equity shares in favour of the Government of India.

On the consolidated basis, SBI group registered 11.82% fall in its net profit after taxes and minority interest at Rs 4298.56 crore for first quarter ended June 30, 2013 as compared to Rs 4874.70 crore for the same quarter in the previous year. However, total income of the bank, on consolidated basis, has increased by 12.23% at Rs 52502.29 crore for quarter under review as compared to Rs 46782.70 crore for the quarter ended June 30, 2012.

Bharti Airtel inks definitive agreement to acquire Warid’s Congo Brazzaville Operations

Bharti Airtel, a leading global telecommunications services provider with operations in 20 countries across Asia and Africa, has entered into a definitive agreement with the Warid Group (Warid) to fully acquire Warid Congo SA. The agreement is subject to regulatory and statutory approvals. The agreement marks the second in-country acquisition by Airtel in Africa. It had acquired Warid’s Uganda operations earlier this year. The latest acquisition will make Airtel the largest mobile operator in Congo Brazzaville with around 2.6 million customers. At present, Airtel is the second largest operator in the country with over 1.6 million customers, while Warid is the third largest with around one million customers.

The agreement aims to bring together the strengths of Airtel and Warid in Congo Brazzaville and benefit customers in the form of affordable tariffs, superior 2G/ 3G network, affordable voice and data services and superior customer care. In addition, existing Warid customers in Congo Brazzaville will join Airtel’s global network of over 280 million customers and enjoy the benefits of ‘One Airtel’ network with affordable roaming rates across Africa and South Asia, besides other exciting bouquet of innovative 2G and 3G services.

Bharti Airtel is a leading integrated telecommunications company with operations in 20 countries across Asia and Africa. The company ranks amongst the top 5 mobile service providers globally in terms of subscribers.

BNP Paribas sells 16.80 lakh shares of Punj Lloyd

BNP Paribas Arbitrage has reportedly sold 16.80 lakh shares or 0.50% stake of Punj Lloyd through the open market route. The shares were sold on an average price of Rs 28.28 valuing the transaction to Rs 4.77 crore.

Punj Lloyd provides engineering, procurement, construction (EPC) and project management services. It provides services to oil and gas, energy, infrastructure petrochemical, telecom broadband and utilities sectors, among others.