QBiz: Core Infra Grows 5%; Auto Sector off to Good Start in FY 18
Here’s a look at the important business stories from the previous day.
1. Core Industries Grow 5% In March, Fastest Pace In 3 Months
The eight core industries grew by 5 percent in March, the fastest pace in three months, on the back of higher coal and steel production.
The growth rate of eight infrastructure sectors – coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity – was however lower than 9.3 percent recorded in March last year.
As per the government data released on Sunday, coal production increased by 10 percent in March as against 2.5 percent a year ago. Steel (alloy + non-alloy) production was up 11 percent compared to 7.8 percent in March 2016.
Electricity generation was up by 5.9 percent. Crude oil and natural gas production was 0.9 percent and 8.3 percent, on annual basis.
On the other hand, cement production declined by 6.8 percent in March while fertiliser output fell 0.8 percent.
There was also a 0.3 per cent decline in production of refinery products.
2. Auto Majors Begin FY18 in Top Gear: Maruti, Tata, Honda Contribute the Most
Strong performances by Maruti Suzuki, Honda, Tata Motors, and Toyota helped passenger vehicle sales grow 16 percent in April.
New launches in recent months continued to drive sales for many companies. Sports utility vehicles remained on a growth path.
Market leader Maruti Suzuki clocked record monthly domestic sales of 1,44,492 vehicles, 23 percent more than the 1,17,045 vehicles sold in April 2016.
South Korean car maker Hyundai, the second-biggest player in India, reported domestic sales growth of 5.7 percent in April to 44,758 vehicles.
Tata Motors has seen a rise of over 22 percent in domestic sales of passenger vehicles, helped by demand for its compact sedan Tigor and SUV Hexa, both launched in 2017.
Japanese car maker Honda reversed its declining trend following the launch of its new City in February. The 38 percent growth in April came on the back of the City and its recently launched crossover WR-V.
3. Govt Raises LPG Price By Rs 2, Kerosene Rate Up By 26 Paisa
Subsidised cooking gas (LPG) price was on Monday hiked by about Rs 2 per cylinder and kerosene rate by 26 paisa a litre as the government looks to eliminate subsidy on the fuel through small hikes.
LPG price in Delhi was hiked by Rs 1.87 per 14.2-kg cylinder to Rs 442.77 per bottle, according to state-owned oil firms.
Oil firms had last raised price of subsidised cooking gas by Rs 5.57 to Rs 440.90 per 14.2-kg cylinder on 1 April. This hike came as the State-owned oil firms on previous two occasions – 1 February and 1 March – did not effect any significant raise in prices in view of Assembly elections in states like Uttar Pradesh.
Subsidised kerosene rate was hiked by Rs 0.26 per litre. A litre of kerosene now costs Rs 19.55 in Mumbai.
4. Snapdeal Board to Discuss Likely Sellout Tomorrow
The board of Snapdeal is expected to meet tomorrow to discuss the potential sale of India’s third largest e-commerce firm to larger rival Flipkart. Also on the agenda will be getting Nexus Venture Partners (NVP), an early investor in Snapdeal, to agree to the sale deal.
The approval of Nexus Venture Partners will be crucial for the proposed transaction to proceed, according to sources close to the development. The seven-member board of Jasper Infotech, which operates Snapdeal, includes representation from investors SoftBank, Kalaari Capital and Nexus Venture Partners (NVP), as well as co-founders Kunal Bahl and Rohit Bansal.
Source: Financial Express
5. Real Estate Act Comes Into Force Today, Only 13 States Notify Rules
The much-awaited Real Estate Act comes into force from Monday with a promise of protecting the right of consumers and ushering in transparency but only 13 states and Union Territories (UTs) have so far notified rules.
The Real Estate (Regulation and Development) Bill, 2016, (RERA Act), was passed by Parliament in March last year and all the 92 sections of the Act comes into effect from 1 May.
The Real Estate Act coming into force after a nine-year wait and marks the beginning of a new era.Housing and urban poverty alleviation (HUPA) minister M Venkaiah Naidu
The minister said the law will make “buyer the king”, while developers will also benefit from the increased buyers’ confidence in the regulated environment.
6. SBI Reduces Term Deposit Rates By Up To 50 Bps
Country’s largest lender State Bank of India has cut its term deposit rates by up to 50 basis points for various maturities. The rates have been revised for medium and long term deposits and for amount below Rs 1 crore.
According to the new structure, for two to less than three years deposits, SBI will offer a rate of 6.25 percent as compared to 6.75 percent earlier, the bank said. For the similar maturity, the deposit rates for senior citizen have been cut to 6.75 percent from 7.25 percent. For deposits maturing between three years and 10 years, the rates have been lowered by 25 basis points to 6.50 percent.
The lender will be offering the new rates for fresh deposits and renewals and are applicable from 29 April.
7. Latin America, Canada, Africa And Nordic Nations Are Becoming New Indian IT Hubs
It may not be all gloom for Indian IT workers aspiring for foreign shores after the US, Australia and Singapore tightened visa rules for skilled migrants. According to some top hiring consultants, in the medium term, several new markets will attract Indian techies.
Indian IT talent will have ready takers in Europe, West Asia and Japan, they said, adding that while the nations that have adopted the protectionist measures will continue to need skilled workers, Latin America, Canada, Africa and the Nordic nations could be the IT hubs of the future.
(Source: The Economic Times)
8. Merger Looms As High Provisions Turn Bharat Financial Unprofitable
Bharat Financial Inclusion Ltd is considering a merger even as India’s fourth largest microfinance lender reported losses in the March-ended quarter on a rise in provisions for bad loans after demonetisation.
The company reported a loss of Rs 234.9 crore compared to a profit of Rs 884 crore in the same quarter last year, according to its stock exchange filing.
Provisioning and write-offs for bad debt went up more than 90 times to Rs 334 crore sequentially. The company had warned of high provisioning after demonetisation in an analyst call in March.
The small business lender said that the board has authorised the management to evaluate strategic options like mergers or acquisitions to expand business. This comes almost two months after private lender IndusInd Bank Ltd confirmed that it is in talks with Bharat Financial, and other entities, for exploring a widely speculated merger.
9. World Bank Pledges $1 bn For India’s Solar Mission
The World Bank on Monday announced plans to provide more than $1 billion to support India’s solar initiatives. An agreement to this effect was signed on Thursday when World Bank Group President Jim Yong Kim met Finance Minister Arun Jaitley and Power Minister Piyush Goyal in New Delhi.
An agreement was signed for a $625-million grid-connected rooftop solar programme. The project will finance the installation of at least 400MW of solar photovoltaic installations that will provide clean, renewable energy and reduce greenhouse gas emissions by displacing thermal generation.
The World Bank Group will also collaborate with the 121-member International Solar Alliance, headquartered in India, with the aim of attracting $1 trillion in investments by 2030 to promote solar energy worldwide.
(Source: The HIndu Businessline)
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