Kotak MF: List of FMPs exposure to Essel Group and IL&FS maturing in April and May

​​According to reports, HDFC FMP 1168D MF scheme is extended by the company by 380 days. ​ETMarkets.com|Apr 11, 2019, 07.23 PM ISTGetty ImagesThe financial crisis at Essel GroupSubhash Chandra-promoted Zee group’s has already affected debt investors of Kotak Mutual Fund, as the money manager has delayed the full redemption of its FMPs. Now, HDFC Mutual…

​​According to reports, HDFC FMP 1168D MF scheme is extended by the company by 380 days. ​

ETMarkets.com|

Apr 11, 2019, 07.23 PM IST

Getty Images

The financial crisis at

Essel Group

Subhash Chandra-promoted Zee group’s has already affected debt investors of Kotak Mutual Fund, as the money manager has delayed the full redemption of its FMPs. Now, HDFC Mutual Fund has decided to rollover one of its fixed maturity plans that is coming up for redemption on April 15.

According to reports, HDFC FMP 1168D MF scheme is extended by the company by 380 days.

The mutual fund industry has a debt exposure of Rs 7,500 crore to the Zee or Essel Group. Of this, around Rs 1,500 crore is in fixed maturity plans with the rest in open-ended debt mutual fund schemes. Kotak and HDFC Mutual Fund hold most of the debt in fixed maturity plans.

Last October’s non-banking financial sector crisis sparked by the collapse of IL&FS led to serious liquidity crisis with many firms unable to roll over and refinance short-term debt. Shares of firms with high debt and finance companies with high proportion of short-term debt were hammered on the bourses. The Essel Group’s private unlisted infrastructure companies were among those unable to raise debt and this affected Zee Entertainment shares which collapsed.

Below is a list of FMPs having exposure to Essel Group and IL&FS and will mature in April and May:

ET NOW

Also Read

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List of FMPs exposure to Essel Group and IL&FS maturing in April and May

Essel Group may monetise non-media assets

Essel group denies link with Nityank lnfrapower over money laundering allegations

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Motherson Sumi Systems slips as HSBC cuts price target

Last Updated : Apr 12, 2019 03:22 PM IST | Source: Moneycontrol.com According to HSBC, Q4 could be another slow quarter for the auto ancillary company but FY20/21 would be strong. ‘); $(‘#lastUpdated_’+articleId).text(resData[stkKey][‘lastupdate’]); //if(resData[stkKey][‘percentchange’] > 0){ …

Last Updated : Apr 12, 2019 03:22 PM IST | Source: Moneycontrol.com






According to HSBC, Q4 could be another slow quarter for the auto ancillary company but FY20/21 would be strong.













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Motherson Sumi Systems shares fell over a percent intraday on April 12 after British investment firm HSBC maintained its buy call on the stock but slashed price target to Rs 170 from Rs 233 per share.

The stock fell nearly 14 percent in last one month when the market was strong. It was quoting at Rs 148.00, down Rs 1.70, or 1.14 percent on the BSE, at 12:18 hours IST.

“Our target price factors in slower car market & rupee appreciation against euro,” said the brokerage which also cut earnings estimates by 15-30% to factor in that weaker domestic & global car markets.

According to HSBC, Q4 could be another slow quarter for the auto ancillary company but FY20/21 would be strong. “We are positive on longer term and company will benefit from rising role of auto component suppliers.”

Domestic car market now seems to have bottomed now, it said, adding, pre-buying of vehicles is likely supporting growth in FY20.

With all new SMP plants in operation since Q3, ramp-up should begin and SMP margin expansion should become visible over the next two-three quarters, HSBC feels.

Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol advises users to check with certified experts before taking any investment decisions.


First Published on Apr 12, 2019 03:22 pm


































Source

oil: Oil slips from 5-month highs as economic worries counter tight market

SINGAPORE: Oil prices eased on Tuesday, slipping away from 5-month highs reached earlier in the session as a sluggish economic outlook countered an otherwise tight market. International benchmark Brent futures touched their strongest level since last November at $71.34 per barrel on Tuesday, before losing ground to $70.96 per barrel by 0158 GMT, down 14…

SINGAPORE:

Oil

prices eased on Tuesday, slipping away from 5-month highs reached earlier in the session as a sluggish economic outlook countered an otherwise tight market.

International benchmark Brent futures touched their strongest level since last November at $71.34 per barrel on Tuesday, before losing ground to $70.96 per barrel by 0158 GMT, down 14 cents, or 0.2 per cent, from their last close.

US West Texas Intermediate (WTI) crude oil futures also hit a November 2018 high, at $64.77 per barrel, before easing to $64.36, 4 cents below their last settlement.

Despite generally bullish oil markets, concerns that an economic slowdown this year will hit fuel consumption have been preventing crude prices from rising even higher, traders said.

And while fears of a global recession ebbed following strong US jobs figures and improved Chinese manufacturing data late last week, Bank of America Merrill Lynch said there was still a “significant slowing in growth globally” in 2019.

The bank said it expects Brent and WTI to average $70 per barrel and $59 per barrel respectively in 2019, and $65 per barrel and $60 per barrel in 2020.

Despite the economic concerns, global oil markets are tight, and Brent and WTI crude oil futures have risen by 40 per cent and 30 per cent respectively since the start of the year.

“Renewed fighting in Libya … has seen Brent crude break above $70 per barrel,” said Ole Hansen, head of commodity strategy at Saxo Bank.

Libya is a significant supplier of oil to Europe, producing around 1.1 million barrels per day (bpd) of crude in March.

A warplane attacked Tripoli’s only functioning airport on Monday as eastern forces advancing on the Libyan capital disregarded international appeals for a truce in the latest of a cycle of warfare since Muammar Gaddafi’s fall in 2011.

Hansen said the fighting in Libya added to an already tense market, which has been tightened this year by US sanctions on oil exporters Iran and Venezuela as well as supply cuts led by the producer club of the Organization of the Petroleum Exporting Countries (Opec).

Source

Movers & Shakers: Mahindra Lifespace tops the charts, ITC’s 5-day average volume jumps 300%

Last Updated : Apr 12, 2019 03:36 PM IST | Source: Moneycontrol.com ITC was trading with volumes of 4,447,821 shares, compared to its five day average of 940,191 shares, an increase of 373.08 percent. The stock saw spurt in volume by more than 6.64 times. …

Last Updated : Apr 12, 2019 03:36 PM IST | Source: Moneycontrol.com






ITC was trading with volumes of 4,447,821 shares, compared to its five day average of 940,191 shares, an increase of 373.08 percent. The stock saw spurt in volume by more than 6.64 times.













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Following jump in share price from ITC and Maruti Suzuki, which gained 2 percent each, the Indian benchmark indices are witnessing some handsome gains with Nifty50 trading at 11,635, up 35 points while the Sensex gained 148 points and is trading at 38,752.

The breadth of the market favoured the advances as 1,360 stocks advanced and 1,150 declined while 174 remained unchanged on the BSE.

Auto, FMCG and the media sectors gained the most. The top Sensex gainers are ITC, Maruti Suzuki, Axis Bank, Vedanta and Hero MotoCorp while the top losers are Bharti Airtel, Bajaj Finance, Larsen & Toubro, Tata Motors and Tata Steel.

Below are the stocks which moved the most with respect to volumes:

Mahindra Lifespace Developers was trading with volumes of 232,945 shares, compared to its five day average of 2,929 shares, an increase of 7,851.97 percent. The stock witnessed spurt in Volume by more than 18.02 times.

GATI was trading with volumes of 748,723 shares, compared to its five day average of 93,649 shares, an increase of 699.50 percent. The stock saw spurt in volume by more than 8.28 times. Mahindra Logistics was trading with volumes of 11,088 shares, compared to its five day average of 1,178 shares, an increase of 841.42 percent. It witnessed spurt in volume by more than 7.52 times.

Fortis Healthcare was trading with volumes of 186,723 shares, compared to its five day average of 25,890 shares, an increase of 621.21 percent. The stock saw spurt in volume by more than 8.18 times.

Power Grid Corporation of India was trading with volumes of 1,979,900 shares, compared to its five day average of 259,755 shares, an increase of 662.22 percent. It witnessed spurt in volume by more than 9.71 times.

ITC

was trading with volumes of 4,447,821 shares, compared to its five day average of 940,191 shares, an increase of 373.08 percent. The stock saw spurt in volume by more than 6.64 times.



First Published on Apr 12, 2019 03:36 pm



































Source

US stocks: S&P 500 flat ahead of Fed minutes

Investors were also assessing a U.S. Labor Department report that showed consumer prices increased by the most in 14 months in March, although underlying inflation remained benign. The tame inflation environment and moderating economic activity support the Federal Reserve’s decision last month to suspend its three-year campaign to raise interest rates. “Amid increasing concern that…

Investors were also assessing a U.S. Labor Department report that showed consumer prices increased by the most in 14 months in March, although underlying inflation remained benign.

The tame inflation environment and moderating economic activity support the Federal Reserve’s decision last month to suspend its three-year campaign to raise interest rates.

“Amid increasing concern that our economy is slowing down, it’s a bit ironic to get a signal above expectations,” Mike Loewengart, vice president of investment strategy at E*Trade Financial, wrote in a note.

“It’s also important to keep in mind this read is a far cry from the type of deflationary levels that would warrant a rate cut, which we’ve begun to hear rumblings about.”

The U.S. central bank will release minutes from its March meeting at 2:00 p.m. ET (1800 GMT), giving an insight into the Fed’s thinking behind its move to suspend rate hikes this year.

The sluggish moves on the main U.S. stock indexes followed a selloff on Tuesday, triggered by trade and growth concerns.

Industrial stocks were down 0.5%, as Boeing Co shares continued to weigh after the company on Tuesday reported zero new orders for its 737 MAX jet following a worldwide grounding of the aircraft in March. Its shares fell 1.4%.

U.S. President Donald Trump threatened to impose tariffs on $11 billion worth of European goods, opening a new front in his global trade war.

The International Monetary Fund’s cut in global growth forecast also added to the gloom, with investors now hoping for better-than-feared first-quarter earnings reports and a dovish Fed to keep up the momentum in the market.

The S&P 500 has risen 14.8% so far this year and is now just 1.6% below its record closing high hit on Sept. 20.

At 10:18 a.m. ET the Dow Jones Industrial Average was down 29.03 points, or 0.11%, at 26,121.55, the S&P 500 was up 2.50 points, or 0.09%, at 2,880.70 and the Nasdaq Composite was up 18.34 points, or 0.23%, at 7,927.62.

Seven of the 11 major S&P sectors were higher.

Technology stocks gained 0.35%, helped by Microsoft Corp, Nvidia Corp and Cisco Systems Inc.

Levi Strauss & Co jumped 6.3% after the jeans maker posted a 7% rise in quarterly revenue after returning to public markets last month.

Advancing issues outnumbered decliners for a 2.28-to-1 ratio on the NYSE and for a 1.66-to-1 ratio on the Nasdaq.

The S&P index recorded 16 new 52-week highs and no new lows, while the Nasdaq recorded 33 new highs and 19 new lows.

Source

iron ore: As Goldman backs off, Citi says chase iron ore rally to $100

Global iron ore prices have powered to multi-year highs this year.Bloomberg|Apr 09, 2019, 08.05 AM ISTReutersIron ore is not a demand story, it’s a supply story.Iron ore is poised to hit $100 a tonne, according to Citigroup, which highlighted “very, very low” seaborne cargoes just as data from China may show a pick-up in demand.…

Global iron ore prices have powered to multi-year highs this year.

Bloomberg|

Apr 09, 2019, 08.05 AM IST

Reuters

Iron ore is not a demand story, it’s a supply story.Iron ore

is poised to hit $100 a tonne, according to Citigroup, which highlighted “very, very low” seaborne cargoes just as data from China may show a pick-up in demand. That view follows advice from

Goldman

Sachs Group that investors should be closing bullish bets after recent gains. “Iron ore is not a demand story, it’s a supply story,” Citigroup said.

“Iron ore is not a demand story, it’s a supply story,” Citigroup, global head of commodities research Ed Morse said in an interview on Monday, reiterating the bank’s three-figure forecast. In a separate note on Sunday, the bank said investors “should ‘chase’ this year’s rally, not sell into it,” referring to iron ore, as well as copper.

Global iron ore prices have powered to multi-year highs this year as the consequences of Vale’s dam collapse in Brazil last quarter hurt production and shipments, and Australian miners BHP Group and Rio Tinto Group flagged lower output after a cyclone.

Also Read

SAIL’s RMD reports highest ever iron ore production in FY19

Government mulling import duty hike on iron ore

SAIL and NMDC should surrender undeveloped iron ore blocks: Experts

SAIL posts 11.62% increase in iron ore production in Feb

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tyre industry: Tyre demand to grow 7-9% during FY19-FY23: Icra

The market would also continue to witness investments over the period of next three years, Icra added.PTI|Apr 11, 2019, 07.34 PM ISTReutersThe revenue growth for tyre industry is pegged at 14-15 per cent for 2018-19New Delhi: The domestic tyre demand is expected to grow in the range of 7-9 per cent over the five year…

The market would also continue to witness investments over the period of next three years, Icra added.

PTI|

Apr 11, 2019, 07.34 PM IST

Reuters

The revenue growth for tyre industry is pegged at 14-15 per cent for 2018-19

New Delhi: The domestic tyre demand is expected to grow in the range of 7-9 per cent over the five year period between 2018-19 to 2022-23, rating agency

Icra

said Thursday.

The market would also continue to witness investments over the period of next three years, it added.

“Icra expects the domestic tyre demand to grow by 7-9 over the next five years (2018-19 to 2022-23),” ICRA Vice President and Co-Head, Corporate Ratings K Srikumar said in a statement.

With a stable demand outlook and strong credit profile, the domestic tyre makers will continue to invest in capacities, he added.

“Based on announcements, the industry is likely to witness a capacity addition of over Rs 20,000 crore in the next three years,” Srikumar said.

The revenue growth for tyre industry is pegged at 14-15 per cent for 2018-19, with operating margin and net margin of 14 per cent and 7 per cent, respectively, almost in line with 2017-18, he added.

“For 2019-20 to 2021-22, revenue growth is projected at 9-10 per cent with operating and net margins at 14-15 per cent and 6-7 per cent, respectively,” Srikumar said.

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Gold: Gold holds near one-week high on subdued dollar, equities

Gold inched higher on Tuesday, trading just below a more than one-week peak hit in the previous session, as Asian equities eased and the dollar weakened following sombre US economic data. FUNDAMENTALS Spot gold was up 0.2 per cent at $1,299.34 per ounce as of 0101 GMT, after touching its highest since March 28 at…

Gold

inched higher on Tuesday, trading just below a more than one-week peak hit in the previous session, as Asian equities eased and the dollar weakened following sombre US economic data.

FUNDAMENTALS

Spot gold was up 0.2 per cent at $1,299.34 per ounce as of 0101 GMT, after touching its highest since March 28 at $1,303.61 in the previous session.

US gold futures gained 0.1 per cent to $1,302.80 an ounce.

The dollar sagged on Tuesday after weak US economic data while commodity-linked currencies such as the Canadian and Australian dollars drew support from an ongoing surge in crude oil prices.

New orders for US-made goods fell modestly in February and shipments rose after four straight monthly declines, but the manufacturing sector is slowing amid rising inventories.

Asian shares got off to a subdued start on Tuesday after a mixed session on Wall Street as investors braced for high-risk events later in the week, while worries about a global growth slowdown weighed on sentiment.

German exports and imports both fell more than expected in February, data showed on Monday, in the latest sign that Europe’s largest economy is likely to post meagre growth in the first quarter amid increased headwinds from abroad.

Just a month after the European Central Bank halted plans to normalise policy and delayed a rate increase into 2020, further signs of weakness in the economy and a whiff of panic among investors is putting the central bank back in the spotlight.

British shoppers cut back spending for the first time in almost a year last month, reflecting a mix of seasonal pressures and Brexit worries, the British Retail Consortium said on Tuesday.

Britain’s parliament approved legislation on Monday that gives lawmakers the power to scrutinise and even change Prime Minister Theresa May’s request that the European Union agree to delay Brexit until June 30.

Theresa May will meet German Chancellor Angela Merkel and French President Emmanuel Macron on Tuesday to argue for a Brexit delay while her ministers hold crisis talks with Labour to try to break the deadlock in London.

Turkey raised its gold holdings by 17.11 tonnes to 495.86 tonnes in March, while Ecuador revised its January figures by 10.58 tonnes to 16.95 tonnes, according to a data from International Monetary Fund.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell about 0.2 per cent to 760.49 tonnes on Monday from 761.67 tonnes on Friday.

Source

Adani Power jumps 5% after CERC approves higher tariff for Mundra unit

Last Updated : Apr 12, 2019 04:00 PM IST | Source: Moneycontrol.com CERC also approved reviewing ceiling price every 5 years as per recommendations by High Powered Committee. Representative image ‘); $(‘#lastUpdated_’+articleId).text(resData[stkKey][‘lastupdate’]); //if(resData[stkKey][‘percentchange’] > 0){ //…

Last Updated : Apr 12, 2019 04:00 PM IST | Source: Moneycontrol.com






CERC also approved reviewing ceiling price every 5 years as per recommendations by High Powered Committee.






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Adani Power shares rallied nearly 9 percent intraday on April 12 after the power regulator approved higher tariff for the Mundra unit. But there was some profit booking towards close, which trimmed gains and the stock closed at Rs 52.95.

After this order, Gujurat Electricity Board approached CERC to seek nod to amend terms for power purchase agreement (PPA) for 2,000 MW.

CERC also approved reviewing ceiling price every 5 years as per recommendations by High Powered Committee.

“It is a good decision for company and gives relief in terms of loss they were making (around Rs 1,000-1,200 crore per quarter). Here are things will not be bad for company and this move will help company curtail losses. One can really book profits at current level,” SP Tulsian of sptulsian.com told CNBC-TV18.

Adani Power had posted a loss of Rs 1,180.8 crore for quarter ended December 2018 against loss of Rs 1,313.7 crore in same period last year.

The company has an installed thermal power capacity of 10,440 MW spread across four power plants in Gujarat, Maharashtra, Karnataka and Rajasthan.



First Published on Apr 12, 2019 04:00 pm


































Source

sebi: Sun Pharma’s senior exec, wife settle insider trading case with Sebi

Mumbai: Sun Pharmaceutical Laboratories’s former chief executive Abhay Gandhi and his wife Kiran have settled insider trading case with market regulator Sebi by paying a total of Rs 70 lakh as settlement charges. Sun Pharma Laboratories is a wholly-owned subsidiary of Sun Pharma. Currently, Gandhi is CEO of Sun Pharma’s North America business. Sun Pharma…

Mumbai:

Sun Pharmaceutical

Laboratories’s former chief executive Abhay Gandhi and his wife Kiran have settled

insider trading

case with market regulator

Sebi

by paying a total of Rs 70 lakh as settlement charges. Sun Pharma Laboratories is a wholly-owned subsidiary of Sun Pharma. Currently, Gandhi is CEO of Sun Pharma’s North America business.

Sun Pharma in an email response to ET said that it is pleased that the matter of Mr Abhay Gandhi and his spouse has been brought to a closure and the company has full faith that Mr Gandhi conducts himself with the utmost integrity in any situation.

The case relates to their trading in shares of Ranbaxy Laboratories in 2014. In July 2013, Sun Pharma first approached Daiichi Sankyo, the promoters of Ranbaxy for acquiring it.

“There were emails sent by Sun Pharma’s advisors to Daiichi during September to November 2013.It was also observed that during the period January 2014 to February 2014,several emails were exchanged between the advisors of Sun Pharma and Daiichi and the same resulted in Daiichi forwarding the proposal of Sun Pharma to Daiichi’s advisor,” Sebi said in its order on Thursday.

Subsequently, Daiichi had sought the time lines from Sun Pharma to finalise the deal.The major aspect in this deal was the agreement of Daiichi to consider any sort of transaction.

“As the majority shareholder in control of the ownership and management of Ranbaxy, no transaction whatsoever could have taken place without Daiichi’s acquiescence. Daiichi after considering the January 31, 2014 presentation forwarded by Sun Pharma, meeting with Daiichi’s and Sun Pharma’s Advisors on February 11, 2014 and appointment of Goldman as financial advisor on February 13, 2014, had asked for timelines for the closure of the deal on February 14, 2014. From this it is inferred that, Daiichi has agreed to the proposal of the Sun Pharma on February 14, 2014,” Sebi said.

The regulator said the information that Daiichi has agreed to Sun Pharma’s proposal to acquire Ranbaxy was price sensitive information(PSI). The PSI came into existence February 14,2014 and the same was made public on April 7,2014 before the start of the trading hours.

Therefore, the unpublished price sensitive information(UPSI) period was from February 14,2014 to April 6,2014, Sebi said. As Gandhi was then the chief of Sun Pharma Laboratories, he and his wife were insiders under Sebi rules.

According to two separate orders, they had traded in the shares of Ranbaxy when the proposed deal was yet to be made public. Gandhi and his wife traded in 454 shares and 6,770 shares, respectively, during the UPSI period.

The regulator said trading in the scrip of Ranbaxy Laboratories, that is buying during the UPSI and selling immediately after the the UPSI was made public by both of them was in violation of its insider trading rules.

“This settlement was based on certain formula where the accused parties decided not to indulge in lengthy litigation. Here the regulators looked at whether the matter could be settled under the settlement regulation or not. Basically when the regulators are investigating a insider trading case, they look at whether that insider trading has a market wide impact or not”, according to a senior official who is aware of the details of the case who did not wish to be quoted.”If such an insider trading does not have market impact then the issue is settleable. This is what the individuals have done. Sun Pharma does follow a governance code that SEBI has prescribed for all listed companies. In fact in this case, Sun was not party to it at all”, this official added.

An email sent to Sumit Agrawal of RegStreet Law who represented Kiran Abhay Gandhi remained un answered.

Sun told ET that the company has “Code of Internal Procedures and Code of Conduct for Prevention of Insider Trading” which stipulates that any employee in possession of unpublished price sensitive information cannot trade in the Company’s shares. Any employee who is not in possession of unpublished price sensitive information and has traded in the Company’s shares has to intimate the Company if the transaction is beyond a certain limit.

The company also explained that as per its “Global Code of Conduct”, every employee is required to abstain from trading in, or recommending the purchase or sale of securities of any other company of which they have obtained material non-public information as a result of their employment by or affiliation with Sun Pharma.

Source

Trade setup for Thursday: Trade setup: Nifty50 has limited upside, likely to remain sluggish

The domestic stock market witnessed unwinding and underwent classical correction on Wednesday, as NSE Nifty fell over 110 points from the day’s high to end 0.75 per cent lower. We expect a flat to negative start on Thursday, and the session may remain volatile due to weekly index options expiry. However, compared with the past…

The domestic stock market witnessed unwinding and underwent classical correction on Wednesday, as NSE

Nifty

fell over 110 points from the day’s high to end 0.75 per cent lower.

We expect a flat to negative start on Thursday, and the session may remain volatile due to weekly index options expiry. However, compared with the past several days, volatility may come down a bit. Moreover, India VIX may also won’ t move much even if market extends fall.

Thursday’s session is set to see 11,630 and 11,690 levels act as resistance points. Supports may come in lower at 11,550 and 11,480.

The Relative Strength Index (RSI) on the daily chart stood at 59.5299. The RSI has marked a fresh 14-period low, which is bearish, showing a bearish divergence against the price.

The daily MACD stayed bearish as it traded below its signal line. A black body appeared on the candles, and apart from this no major formations were observed.

The pattern analysis showed a double top getting confirmed at the 11,760 level. This is a major resistance for Nifty, as it took seven months to get formed. Also, the index retraced from those levels again.

Speaking on broader terms, the present corrective behaviour of the market is likely to persist for some more time. We do not expect any major upmove until 11,760 is taken out comprehensively.

Looking at Brent crude prices along with dollar-rupee behaviour over the couple of sessions, we might see Indian currency appreciating more with the level of 68.90 acting as strong base.

Cumulatively, these factors may not give much boost to the equoties.

As Nifty is expected to extend its fall, a cautious view is advised for Thursday.

(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research & Advisory Services, Vadodara. He can be reached at milan.vaishnav@equityresearch.asia)

(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of

http://www.economictimes.com

.)

Source

mutual fund: Sebi comes up with system audit framework for AMCs/MFs, asks to form technology committee

The guidelines come after “considering the importance of system audit in technology driven asset management activity and to enhance and standardise the system audit”.PTI|Apr 11, 2019, 07.38 PM ISTBCCLThe regulator has asked MFs and AMCs to conduct system audit on an annual basis by an eligible independent auditor.New Delhi: Markets regulator Sebi Thursday came out…

The guidelines come after “considering the importance of system audit in technology driven asset management activity and to enhance and standardise the system audit”.

PTI|

Apr 11, 2019, 07.38 PM IST

BCCL

The regulator has asked MFs and AMCs to conduct system audit on an annual basis by an eligible independent auditor.

New Delhi: Markets regulator

Sebi

Thursday came out with revised guidelines for system audit to be conducted by mutual funds and asset management companies (AMCs).

The guidelines come after “considering the importance of system audit in technology driven asset management activity and to enhance and standardise the system audit”, Sebi said in a circular.

Besides, mutual funds (MFs)/ AMCs have been directed to constitute a technology committee entrusted with the task of reviewing the cyber security and cyber resilience framework for MFs and AMCs, Sebi said in a separate circular.

Sebi said the committee will comprise experts proficient in technology with at least one independent external expert with adequate experience in the area of technology in MF industry or BFSI, it added.

The regulator has asked MFs and AMCs to conduct system audit on an annual basis by an eligible independent auditor.

The audit should include the audit of systems and processes related to fund accounting system for calculation of net asset values, financial accounting and reporting system for AMC.

Moreover, audit related to unit-holder administration and servicing systems for customer service, funds flow process, system processes for meeting regulatory requirements, prudential investment limits and access rights to systems interface shall also be done.

Further, MFs and AMCs are required to submit a report regarding exceptions observed in the system audit to the technology committee for review in the prescribed format.

The committee after reviewing the report shall place it before the AMC & Trustee Board. The report along with trustee’s comments should be communicated to Sebi within six months of the respective financial year, starting from 2019-20.

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RBI: Impact of RBI rate cuts to remain muted

Kolkata: The half a dozen banks which had lowered marginal cost based lending rate (MCLR) in March are likely to abstain from further rate action despite Reserve Bank of India’s signal for easier financing cost. The rest including the bigger ones State Bank of India and HDFC Bank have taken the plunge with 5-10 basis…

Kolkata: The half a dozen banks which had lowered marginal cost based lending rate (MCLR) in March are likely to abstain from further rate action despite Reserve Bank of India’s signal for easier financing cost.

The rest including the bigger ones State Bank of India and HDFC Bank have taken the plunge with 5-10 basis points reduction in benchmark rate following RBI’s second successive repo rate cut on April 4 but these are way below what was signaled by the central bank.

RBI has reduced the repo rate by a total of 50 bps in 2019 to push economic growth while banks are facing difficulty in passing on the benefit as deposit rates remain sticky.

“Banks are not lowering their rates as deposit rates need to be lowered first. This cannot be done given the slow growth in deposits as households have shifted to equities and mutual funds. Currently, to meet their credit requirements they have been sourcing corporate deposits at a higher rate,” said Madan Sabnavis, chief economist with CARE Ratings.

RBI Governor Shaktikanta Das said he would hold “further consultations with stakeholders and work out an effective mechanism for transmission of rates.”

Lenders such as ICICI Bank, Bank of Baroda, Punjab National Bank and Union Bank of India reduced their respective MCLR by 5-10 bps in the next 40 days after RBI’s February policy action. “These may not go for further rate cuts,” a chief executive of a public sector bank said.

Axis Bank, HDFC Bank, ICICI Bank and YES Bank did not respond to mails seeking comments on their interest rate strategy.

“The present scene only shows that monetary transmission cannot be enforced but has to happen through the market forces. What SBI is doing is a positive step as the cost of funds comes down when rates on high level savings account is lowered. Further, it should be remembered that when lending rates are lowered all loans get repriced while deposits get repriced only on renewal or on fresh deposits. Therefore, average cost will not go down for some time,” Sabnavis explained.

Impact of deposit rate cuts work with around six months’ lag.

“We are conscious of the fact that there has to be effective and appropriate transmission of the rates. After the last meeting, I had held meetings with public sector and private sector banks. The banks have cut MCLR by up to 10 basis points. But more needs to be done,” Governor Das had said on Aril 4 after announcing the second 25 bps rate cut in quick succession.

Source

Gold: Outlook: Gold on track to scoop up more gains

Crude oil may remain sideways, which is seen to run up towards Rs 4,520 while finding strength near Rs 4,440 on MCX.ETMarkets.com|Updated: Apr 09, 2019, 10.45 AM ISTGold can take support near Rs 31,900 while facing resistance near Rs 32,450.NEW DELHI: Gold futures are expected to take on some lustre on Tuesday in light of…

Crude oil may remain sideways, which is seen to run up towards Rs 4,520 while finding strength near Rs 4,440 on MCX.

ETMarkets.com|

Updated: Apr 09, 2019, 10.45 AM IST

Gold can take support near Rs 31,900 while facing resistance near Rs 32,450.

NEW DELHI:

Gold

futures are expected to take on some lustre on Tuesday in light of a positive trend overseas.

The metal scaled more than one-week high, aided by dollar weakness.

The greenback was shackled by a combination of weak US economic data and gains for commodity-linked currencies such as Canadian and Australian dollars, which drew support from an extended surge in crude oil prices, Reuters reported.

How is the commodity play looking like? We bring you a report from brokerage SMC Global Securities.

Bullion: Gold can take support near Rs 31,900 while facing resistance near Rs 32,450. Silver can witness lower level buying and test Rs 38,300 while taking support near Rs 37,600.

Base metals: Base metals may show a positive bias. Copper may test Rs 456 while taking support near Rs 445 on MCX. Zinc can test Rs 231 while finding relief near Rs 226. Lead can move in a range of Rs 137-140. Nickel may recover towards Rs 928 while taking support near Rs 905. Aluminium prices may move in the range of Rs 145-148.

Energy: Crude oil may remain sideways, which is seen to run up towards Rs 4,520 while finding strength near Rs 4,440 on MCX. Natural gas may witness lower level buying and test Rs 193, with a likely support near Rs 185.

Spices: Turmeric futures (May) are expected to harden and hit Rs 7,000, taking positive cues from the spot markets. Jeera contracts are likely to breach the barrier near Rs 16,300 and move ahead up to Rs 16,500. Coriander futures are likely to take support above Rs 7,150.

Oilseeds: Soybean futures are expected to come down to test Rs 3,790 levels and those of soy oil will possibly touch Rs 725 level on the downside. CPO futures (April) are expected to retreat towards Rs 537 level, taking negative cues from the international market. Mustard futures for May are expected to trade with a negative bias in the range of Rs 3,760-3,795 levels.

Other commodities:

Cotton futures (April) are hovering near two-month high and may log more gains, likely hitting Rs 22,600. Guar seed and guar gum futures (May) together may take support from near Rs 4,440 and 9,040 levels, respectively.

Also Read

Gold Rate Today: Gold falls on weak demand

Gold Rate Today: Gold climbs higher on raised spot demand

Gold Rate Today: Gold prices fall as demand slumps

Gold Rate Today: Gold trades lacklustre on muted spot demand

Gold Rate Today: Gold prices decline on weak demand

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Dollar borrowings: India Inc is seeking dollar borrowings, but only select firms will find

MUMBAI: Indian companies are lining up to seek dollar-denominated debt as global interest rates soften, but only a few are likely to find it as foreign investors remain wary about the credit quality of many, bankers say. It’s no surprise that firms want to tap the offshore market, given lower rates, ample dollar liquidity, reduced…

MUMBAI: Indian companies are lining up to seek dollar-denominated debt as global interest rates soften, but only a few are likely to find it as foreign investors remain wary about the credit quality of many, bankers say.

It’s no surprise that firms want to tap the offshore market, given lower rates, ample dollar liquidity, reduced rupee hedging costs and the reluctance of Indian lenders – many of whom are grappling with bad debts – to take on more risk.

Also making offshore debt attractive is that the Reserve Bank of India has eased external commercial borrowings guidelines, and started forward dollar-rupee swap auctions.

From the start of 2019 through Thursday, when India’s giant election got under way, more than a dozen companies raised $7 billion offshore, according to Refinitiv.

That’s well above the $4.7 billion done in 2018, when dollar liquidity was tight due to four rate hikes by the U.S. Federal Reserve.

And among those aiming for dollar-debt are renewable energy firms Adani Green Energy Ltd, Greenko Group and Azure Power, according to people knowledgeable about their plans.

Together these companies plan to raise over $1 billion in overseas bonds in the next few months, they say.

Also wanting to tap offshore funds are non-bank finance companies (NBFCs) Bajaj Finance, Tata Capital, Tata Motor Finance, L&T Finance and Shriram Transport Finance, according to bankers who estimate that in total they hope to secure $2.0 billion-$2.5 billion.

Along with manufacturing firms, NBFCs are natural applicants for securing offshore funding. The institutions – commonly called shadow banks in India – are the biggest source of funding for small businesses. Many NBFCs need to increase capital, and are struggling to do it domestically.

A STRUGGLE TO SECURE

But bankers say lower-rated ones will also struggle to secure dollar debt, as foreign investors remain skeptical of their credit quality.

Shantanu Sahai, Nomura’s head of debt capital markets in Mumbai, said top-rated NBFCs “will easily get access” to offshore money” while a second tier will have to wait until the elections are over, and a third tier face months of trying to convince investors to be confident of their credit quality.

“Investors will only buy debt in those NBFCs which have predictive cash flows,” he said.

A series of debt defaults by an infrastructure funding major in September has eroded confidence of lenders and investors in the not-so-tightly-regulated NBFCs, as many remain worried about their asset quality despite policymakers taking steps to improve cash conditions.

The forward dollar-rupee auctions started by the central bank are one factor incentivising Indian firms to seek offshore debt. This has brought down hedging costs by as much as 60 basis points to 3.51 percent on one year forward dollar/rupee rates .

“There are many corporates and NBFCs who are enquiring with us,” said a private debt investment banker.

“They are locally AA rated and have not raised dollar bonds before. We are telling them candidly to wait for some more time. It is a market for high-grade, high pedigree corporates now. For the lower rated ones, market conditions are sub-optimal.”

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