India Income Tax for FY2010-11
Here are the new Income Tax Rates for Indian Citizens for Financial Year April-1st 2010 to March-31st 2011. [See Chart Below]
In case of resident women (below 65 years of age) and resident senior citizens, the amount of INR 160,000 shall be replaced with INR 190,000 and INR 240,000, respectively. The proposed changes in tax slabs would result in (maximum) savings of INR 51,500. Read more
Everest Kanto and its arms bag orders aggregating $27 million
Everest Kanto Cylinder (EKC), a pioneer in development and production of industrial and CNG cylinders, has received orders for export of CNG cylinders amounting to about $5 million. The execution of these orders is expected to be completed by May 2010.
Besides, the company’s overseas subsidiaries have also received orders in their respective locations. EKC International FZE, a wholly owned subsidiary of the company in Dubai, has received orders for the supply of CNG cylinders aggregating about $20 million. The execution of these orders has already started and is planned to be completed by May this year. Read more
Life insurance sector growth normalizing + Valuation
The growth of Indian private life insurers normalised to 14% YoY (-33% MoM) in January 2010, post December 2009, when growth had jumped to 59% YoY, ahead of the withdrawal of noncompliant products from January 2010. The industry APE growth was up 3% YoY (-27% MoM).
ICICI’s market share gains sustained (11.1% currently – up 190 bp over the last six months), whereas Bajaj and HDFC witnessed a sharp rise in this month (+127 bp and +94 bp MoM). SBI continued to be the strongest performer, with 27% YTD APE growth, whereas Kotak was the weakest performer (-21% YTD). Read more
India Term – Fixed Deposit Rates Rising
HDFC Bank, over the weekend, raised deposit rates by a sharp 50-150 bp, which follows the 25-50 bp rate hike by ICICI Bank and IDBI earlier this month. Notably, this deposit rate action has come, even as system liquidity currently appears adequate (reverse repo outstanding at about USD 15 bn). As the loan growth (14.8% currently) accelerates and central bank tightens, this liquidity will also dry up soon.
As deposit growth (17%YoY) has fallen to a four-year low, with real deposit rates negative, banks need to raise rates. Read more
Cement Price hikes in India in H1-2010 – Merrill
As India is entering the peak season for construction (January to June), the industry reported a surge in cement demand of around +13% in January, Y-o-Y. Cement companies have witnessed strong volume growth on the back of increased government spending on housing, roads, ports & power stations and the momentum is expected to continue. Read more
Indian Food price inflation – not just a one-off
There is more to India’s food price inflation – which touched a decade-high 20% YoY in December 2009 – than just the drought. A fundamental tightness in the domestic demand-supply balance of food seems to have emerged over recent years. The spurt in wholesale prices of some food items in 2009 – sugar 35%, pulses 41%, milk 13% and eggs 24% – was the highest in over a decade and that could complicate monetary policy. Global food price trends alone do not explain the acceleration in food price inflation in India. Read more
Current Fitch Sovereign Rating of India
Here is what Fitch the international rating agency thinks of India. It said,
The Negative Outlook on the Local?Currency IDR reflects the agency’s judgement that the fiscal deterioration in the year to end?March 2009 (FY09) and FY10 has been partly structural in nature, and that India’s public finances are set to stress comparisons with ‘BBB’ peers beyond breaking point. The agency looks for meaningful fiscal consolidation measures to get India’s public finances onto a path consistent with the current ratings. Read more
Enterprise Wireline Tariffs to Come Down – Reliance Communication
In an analyst call, the management of Reliance Communications have said that Wireline / Landline Tariffs are under pressure as Wireless Tariffs have fallen significantly and the company si facing pressure especially from the Enterprise Segment.
Other highlights of the call are – Although RCOM’s RPM declined 4.6% in Q310, its EBITDA margin was down 156 bp; management mentioned this was due to continued investments in network and higher Read more
TVS Motor’s January sales up 34%
Chennai-based two-wheeler maker, TVS Motor Company has reported 34% jump in its January sales. The company sold total 125,578 two-wheelers during the month under review against 93,729 units in January 2009.
On domestic front, it has clocked 37% growth in January 2010 by registering sales of 109,504 units as compared to 79,729 units in the corresponding period of the previous year. Read more
Reliance Globalcom and Broadband revenues Declines
Rcom’s Q3FY10 results were below expectations on the revenue and EBITDA front on account of a steeper decline in Globalcom and Broadband revenues than anticipated.
The EBITDA margin declined sequentially by 128bps due to the drop in revenue and a 15.3% increase in access charges, which was only partly offset by a decline in network / SG&A cost.
PAT was ahead of our estimates with a growth of 56.6% QoQ on account of finance income of Rs 4bn as against a finance charge of Rs 6.5bn in the previous quarter. Rcom’s finance charge accounting remains a difficult area to comprehend.
The flat trend in wireless revenue was a positive sign, though the steep fall in Globalcom and Broadband revenues surprised negatively. Wireless revenue increased QoQ by 0.3% on the back of 8.6% subscriber growth and a 7.4% fall in ARPU. ARPU declined from Rs 161 to Rs 149 QoQ.