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TECHNICAL TREND ( NIFTY - BANK NIFTY FUTURES )
NIFTY FIFTY : - The Equity benchmark Nifty 50 opened Gap up on Monday at 8666
after closing at 8611 on Friday in the previous week. Nifty Traded in a range of 110
points between 8745-8635. Nifty Witnessed a sharp rally from a low of 8562 to 8786 in
last two trading session. On Tuesday Nifty traded in a small range of 45 points before the
RBI policy was announced. Urjit Patel in his first Monetary Policy decision announced a
25 bps rate cut which was positively welcomed by the markets. Post policy
announcement, Nifty made a low of 8767 to rise till 8813 before closing at 8802. The
inherent strength in the Indian Markets, backed by strong fundamentals of the Indian
companies, seems to continue with the next target of Nifty at 8994. Domestic market
space is quite range bound and perhaps laggard as of now for last couple of sessions due
to lack of conceptions regarding direction among trading participants ahead of earning
season. Nifty 50 will continue to take support at 8705 – 8718 and consolidate till next
week but may face stiff resistances around 8798, 8809 or 8826 – 8848. From this level
Nifty has to sustain over 8705-8725 zone for further rally up to 8875-8900 in the Short
Term. The Significant Support for Nifty is 8650-8620 and Resistance of 8768-8818.
BANK NIFTY : - The Bank Nifty opened in a positive note on Monday up by 110 points
or 0.56 per cent at 19395. The PSU Banks traded in bullish trend on Tuesday trading
session in response of rate cut by Reserve Bank of India and proposal to ease stressed
Asset Norm. Upcoming Fundamentals will impact entire Market structure and pave the
way for future market movements. Recent Price action of Bank Nifty is quite distinct
from earlier retracements and corrections that occurred within the trend. September is a
poor month for traders since many indices and stocks couldn’t breach beyond the tight
consolidation. The tight consolidation is due to less participation and less liquidity.
October seems interesting from the start as RBI policy and ongoing Global cues will
entertain market participants. Investors should brace for more volatility in upcoming
days. Market shows a shift in the behavior of recent Uptrend’s structure. Sharp selloff
from 20,500 to 19,000 on the month of September is indicating the strength of selling
pressure. It obviously shows a shift trend’s character. We need to see how buyers will
react, if influx of selling pressure relaxes. Traders should focus on Price action in daily
chart. The Dynamic Levels for Next week of Bank Nifty is 19560-19875 is down side
and 20800-21756 is Up side.
Monday, 10 October 2016
TECHNICAL VIEW (NIFTY- BANK NIFTY FUTURES )
NIFTY
DAILY R2 R1 PP S1 S2
8869 8751 8692 8633 8515
WEEKLY R2 R1 PP S1 S2
9223 8881 8710 8539 8197
MONTHLY R2 R1 PP S1 S2
9225 8883 8712 8541 8199
BANK NIFTY
DAILY R2 R1 PP S1 S2
19789 19523 19390 19257 18991
WEEKLY R2 R1 PP S1 S2
20992 20006 19513 19020 18034
MONTHLY R2 R1 PP S1 S2
20992 20006 19513 19020 18034
MOVING AVERAGE 21 DAYS 50 DAYS 100 DAYS 200 DAYS
NIFTY 8733 8662 8475 8258
BANK NIFTY 19613 19338 18682 17960
PARABOLIC SAR DAILY WEEKLY MONTHLY
NIFTY 8560 8960 7493
BANK NIFTY 19102 20499 15079
PATTERN FORMATION ( NIFTY )
Detail of Chart - On the above given daily Chart of NIFTY has applied Bollinger Band
along with Parabolic SAR both the indicators are Leading, and gives signal of Buying or
Selling. Although the Uses of Bollinger Band differ from traders to traders Some
buywhen it break the Middle Band from below side and some buy when it break Upper
Band. We assume that the Breaking the Middle Band Usually a Bull side Signal as we
can see that. Although on the Above given Chart it is trading below the middle Band and
around the lower Band break the lower Band will decide trend for the Nifty For Next
Week , There is a uncertainity of Bull if Nifty is able to cross the level of 8780 could
move toward the 8800-8880 in near term. The Crucial Levels for NIFTY is 8700-8680 is
down side and 8820-8860 is up side.
PATTERN FORMATION ( BANK NIFTY )
Detail of Chart - On the Above given Bank Nifty daily Chart has Applied Bollinger
Band Along with Parabolic SAR on the above given Chart of Bank Nifty it has touch the
Middle Band but it was not able to Sustain the Significance Resistance of 19900 in last
week and bounce back from that level. From now we are expecting if it is able to sustain
the level of 19520-19460 level could lead the Index toward the 18780 level in near Term.
If Break below 19500 it could move toward the level of 19200-19160 in near term. The
Crucial Levels for Bank Nifty is 19460-19350 Down side and 19836-20156 is up side.
NSE EQUITY DAILY LEVELS
COMPANY
NAME
R2 R1 PP S1 S2
ACC EQ 1640 1633 1620 1613 1600
ALBK EQ 79 78 78 77 77
AMBUJACEM EQ 257 255 252 250 247
ASIAN PAINT EQ 1221 1203 1191 1173 1161
AXISBANK EQ 543 538 534 529 525
BAJAJ-AUTO EQ 2966 2928 2856 2818 2746
BANKBARODA EQ 167 165 164 162 161
BANKINDIA EQ 119 118 117 116 115
BHEL EQ 137 136 135 134 133
BHARTIARTL EQ 327 323 320 316 313
CIPLA EQ 590 581 573 564 556
COALINDIA EQ 322 320 318 316 314
DLF EQ 158 157 155 154 152
DRREDDY EQ 3098 3077 3061 3040 3024
GAIL EQ 423 420 416 413 409
GRASIM EQ 1051 1040 1022 1011 993
HCLTECH EQ 824 815 800 791 776
HDFC EQ 1437 1419 1409 1391 1381
HDFCBANK EQ 1293 1288 1282 1277 1271
HEROMOTOCO EQ 3516 3494 3470 3448 3424
HINDALCO EQ 162 159 158 155 154
HINDUNILVR EQ 900 889 879 868 858
ICICIBANK EQ 256 253 251 248 246
ITC EQ 242 241 238 237 234
INDUSIND BANK EQ 1241 1234 1221 1214 1201
INFY EQ 1041 1026 1018 1003 995
JINDALSTEL EQ 81 81 79 79 77
KOTAKBANK EQ 791 786 781 776 771
LT EQ 1469 1462 1451 1444 1433
M&M EQ 1394 1382 1376 1364 1358
MRF EQ 55123 54252 53658 52787 52193
MARUTI EQ 5740 5712 5690 5662 5640
ONGC EQ 276 271 269 264 262
ORIENTBANK EQ 131 130 129 128 127
RCOM EQ 50 48 47 45 44
RELCAPITAL EQ 585 581 574 570 563
RELIANCE EQ 1129 1118 1112 1101 1095
RELINFRA EQ 594 589 585 580 576
RPOWER EQ 49 48 48 47 47
SBIN EQ 261 260 257 256 253
SSLT( VEDL) EQ 201 197 195 191 189
SUNPHARMA EQ 760 755 752 747 744
TATAMOTORS EQ 576 571 561 556 546
TATAPOWER EQ 83 81 80 78 77
TATASTEEL EQ 418 413 401 396 384
UNIONBANK EQ 151 150 148 147 145
TOP 15 ACHIEVERS // TOP 15 LOOSERS
SR.NO SCRIPT NAME PREV CLOSE CMP % CHANGE
1 GRASIM INDUS. 4836 1024 -78.81 %
2 KAJARIA CERAM 1389 709 -48.94 %
3 IDFC BANK 79.85 73.55 -7.89 %
4 IBREAL 92.15 86.85 -5.75 %
5 DB CORP 394 381 -3.49 %
6 TATA ELXSI LTD. 1392 1344 -3.42 %
7 SUZLON ENERGY 14.85 14.40 -3.03 %
8 INDO COUNT IND 726 706 -2.67 %
9 TCS 2430 2367 -2.59 %
10 INFOSYS 1036 1012 -2.27 %
11 M&M 1405 1374 -2.26 %
12 BANK BARODA 167 163 -2.12 %
13 CIPLA 580 570 -1.72 %
14 DR. REDDY’S LAB 3107 3054 -1.71 %
15 AXIS BANK 541 533 -1.39 %
SR.NO SCRIPT NAME PREV CLOSE
CMP % CHANGE
1 GAIL LIMITED 374 414+10.52 %
2TATA STEEL 374 406 +8.63 %
3 BPCL 612 663+8.32 %
4TATA POWER 75 80 +7.03 %
5 TATA MOTORS 534 565+5.77 %
6ZEEL 546 572 +4.65 %
7 ONGC 256 267+4.17 %
8ADANI PORTS 256 266.85 +3.93 %
9 MARUTI SUZUKI 5477 5683+3.77 %
10HINDALCO 152 158 +3.47 %
11 SBIN 251 258+2.97 %
12RELIANCE 1083 1109 +2.33 %
13 ULTRACEMCO 3851 3933+2.14 %
14INDUSIND BANK 1195 1220 +2.08 %
15 ASIAN PAINTS 1160 1184+2.06 %
NSE - WEEKLY NEWS LETTERS
✍ TOP NEWS OF THE WEEK
RBI unlikely to lower rates given the stiff inflation: Experts - The Reserve Bank of
India will hold its monetary policy review today, with the newly formed Monetary Policy
Committee fixing interest rates for the first time. With more supporting data on inflation
yet to come, the MPC headed by RBI Governor, Urjit Patel is not likely to cut interest
rates, at the first policy review of the newly constituted committee, as per reports. Since
both Consumer Price Index and Wholesale Price Index have not yet turned benign,
interest rate cut by the RBI in this meeting looks difficult, R P Marathe, Managing
Director and Chief Executive, Bank of Maharashtra said. Additionally, Arun Tiwari,
Chairman and Managing Director, Union Bank of India is also of the view that while the
central bank will not give a rate cut in this meeting, measures pertaining to resolving non-
performing assets could be unveiled at the policy meet on Tuesday, as per reports."The
new governor should focus on growth that will create more jobs and strengthen the
economy. Above average monsoon has helped stabilize food prices that were a cause of
concern over the last two years. We expect the monetary policy to be forward looking and
feel that a rate cut now will be well received and shall impact sentiments positively. This
will infuse confidence in the system thereby providing a boost to not only the real estate
sector, but the overall economy ahead of the crucial festive season,
It is imperative for banks to reduce interest rates as per RBI, which has not yet been seen.
The combination of lower interest rates alongside the progressive measures taken by the
government towards reforms has the potential to reinvigorate demand in all segments of
the economy, With hopes hinged on RBI for a rate cut, losses in domestic equity market
last week were reversed. The domestic stock market is factoring in at least 25 bps rate cut
by RBI.
Private consumption set to get a 90 bps monsoon boost: CRISIL - The distribution of
monsoon this season has been the best in the last three years, with only a third of the
districts seeing deficiency compared with almost half in fiscal 2015 and 46% in 2014.
Importantly, most of the deficient districts are either well-irrigated or not important
agriculturally. As a result, CRISIL expects nominal agricultural GDP to rise by Rs. 1.49
trillion this fiscal, compared with Rs. 978 billion in fiscal 2016. This is despite a spike in
farm output putting downward pressure on prices and farm incomes. Also, the rural
markets, which account for 54% of private consumption, is already seeing some green
shoots.
Says Dharmakirti Joshi, Chief Economist, CRISIL: “So this time around, India’s
consumption story will have two legs instead of just the urban engine on which it has
duked out the past two years. We see private consumption rising 90 basis points to 8.3%
this fiscal compared with 7.4% in fiscal 2016.” After a slow start in June, rains caught up
and has been recorded as ‘normal’, at just 3% below the long-period average. Not
surprisingly, area coverage under kharif crops has risen to 1,060 lakh hectare compared
with 1,052 lakh hectare last year. To be sure, there are pockets of stress, mainly in
Gujarat and Karnataka, where some districts had their second or third consecutive
deficient monsoon. CRISIL’s state-wise Deficient Rainfall Impact Parameter, or DRIP,
scores show all states barring Gujarat, Tamil Nadu and Odisha are above-trend. Also,
among crops, only groundnut has a below-trend DRIP score.
About 33% of the districts have seen deficient rains this year. But more than half of these
have adequate irrigation cover. Plus many rain-deficient districts are agriculturally less
relevant, contributing under 4% to kharif production and having less than 7% of overall
sown area, underscoring limited impact. The share of Gujarat and Karnataka in all-India
kharif production is less than 7% and that of their distressed districts just 1.7%. However,
the stress to agricultural household incomes could be high as a quarter of the kharif
production in Karnataka and about 33% in Gujarat comes from the distressed districts.
Also, the kharif crop contributes about 66% of the total agriculture production in
Karnataka and 55% in Gujarat.
Govt working on rollout of GST from next April: FM Arun Jaitley - The Union
Finance Minister Arun Jaitley said that the Government is working on a target date of 1st
April, 2017 for the roll out of the Goods and Services Tax in the country. He said that till
16th September, 2017, that is one year after the provisions of the Constitution 101st
Amendment Act, 2016 being brought into force, the Constitution empowers the Central
Government to levy excise duty on manufacturing; and service tax on the supply of
services. The Finance Minister said that similarly the Constitution Amendment Act
empowers the State Governments to levy sales tax or Value Added Tax on the sale of
goods till that time i.e. 16th September, 2016. The Finance Minister Jaitley said that so
far the Government is following the road map for implementation of GST as per the
schedule. The Finance Minister Jaitley was making his Opening Remarks at the Fourth
Meeting of the Parliamentary Consultative Committee attached to the Ministry of Finance
held here today. The subject of today’s Meeting was the Goods and Services Tax.
The Finance Minister Jaitley further said that the First Meeting of the GST Council was
held in a very cordial and constructive environment earlier this month and today, he hold
the Second Meeting of the GST Council. In the GST regime, the GST Council has been
created under Article 279A of the Constitution. The GST Council is a joint forum of the
Centre and the States. The Council will take decisions on important issues like tax rates,
exemption list and threshold limits etc.
“It is vitally important to defend the prospects for increasing trade integration,’’ he,
said. “Turning back the clock on trade can only deepen and prolong the world economy’s
current doldrums.” To support growth in the near term, the central banks in advanced
economies should maintain easy monetary policies, the IMF said. But monetary policy
alone won’t restore vigor to economies dogged by slowing productivity growth and aging
populations, according to the new report. Where possible, governments should spend
more on education, technology, and infrastructure to expand productive capacity while
taking steps to alleviate inequality. Many countries also need to counteract waning
potential growth through structural reforms to boost labor force participation, better
match skills to jobs, and reduce barriers to market entry. The world economy will expand
3.1 percent this year, the IMF said, unchanged from its July projection. Next year, growth
will increase slightly to 3.4 percent on the back of recoveries in major emerging market
nations, including Russia and Brazil.
Centre softens on bad loans, asks PSBs to handhold top borrowers - The government
has asked state-run lenders to identify top borrowers and hand-hold them if they are
facing trouble over repayments, marking a significant softening of stance on bad loans.
The move is aimed at sprucing up credit growth and driving investments amid realisation
that the crackdown on Non-Performing Assets is hurting investments, officials said.
Promoters who have viable projects will get support for both existing and new projects, a
senior finance ministry official told .“In the first phase, banks will identify top 50-100
borrowers and look at their exposure and existing accounts,” the official said on condition
of anonymity. In genuine cases, banks will take extra steps to support borrowers through
measures like increasing their cash credit limit, the official said. “The banking regulator is
on board,” he said. The issue was discussed at the quarterly performance review of public
sector banks held last month, the official said. In his first monetary policy review on
Tuesday, Reserve Bank of India governor Urjit Patel also hinted at a more
accommodative stance on dealing with bad loans. “We have to deal the issue with
firmness but also with pragmatism so that the economy does not feel any lack of credit,”
Patel said, adding that RBI will move at various levels to deal with the situation and work
with both banks and government.
IMF Sees subdued global growth, warns economic stagnation could fuel
protectionist calls - Global economic growth will remain subdued this year following a
slowdown in the United States and Britain’s vote to leave the European Union, the IMF
said in its October 2016 World Economic Outlook. “Taken as a whole, the world
economy has moved sideways,” said IMF chief economist and economic counselor,
Maurice Obstfeld. “We have slightly marked down 2016 growth prospects for advanced
economies while marking up those in the rest of the world,” he said.
The report highlighted the precarious nature of the recovery eight years after the global
financial crisis. It raised the specter that persistent stagnation, particularly in advanced
economies, could further fuel populist calls for restrictions on trade and immigration.
Obstfeld said such restrictions would hamper productivity, growth, and innovation.
Private equity real estate investments down by 30 per cent during Jan-Sep: Report -
Private equity investments in real estate have declined 30% from a year ago to 48
transactions worth nearly $ 2.5 billion in the first nine months of 2016. During the same
period in 2015, the investment stood at $ 4.2 billion across 69 transactions, according to
Venture Intelligence. Private Equity-Real Estate firms made 20 investments--having an
announced value of $ 1.01 billion across 16 deals--during the quarter ended Sep 2016.
The volume of investments was up about 25% from the 16 investments worth $ 579
million in the immediate previous quarter. However, compared to the same period in the
previous year which had witnessed 23 investments amounting to $ 2,170 million, the
volume of Investments was down about 13%. The predominant focus of investors
continued to be on the residential segment in the main metros which accounted for 17 of
the 20 investments, while commercial segment attracted three investments, Venture
Intelligence said in a release.
✍ TOP ECONOMY NEWS
The price of petrol was hiked by 14p/l and that of diesel by 10p/l, following increase in
commission paid to dealers.
The Reserve Bank of India cut repo rate by 25 bps to 6.25%. Reverse repo rate under the
LAF stands adjusted to 5.75%, and the marginal standing facility rate and the Bank Rate
to 6.75%. All six members of the monetary policy committee voted in favour of cutting
repo rate.
The Center and the Maharashtra government have arrived at a consensus on the
development of a mega refinery and petrochemical complex in the Konkan region.
India and Singapore vowed to “expedite” the second review of the Comprehensive
Economic Cooperation Agreement in an effort to boost two-way trade during a bilateral
meeting between Prime Minster Narendra Modi and his Singaporean counterpart Lee
Hsien Loong.
Private equity investments declined 50% during the September 2016 quarter to USD 3.2
billion across 125 deals compared to USD 6.5 billion across 224 transactions in the year-
ago quarter.
With a view to boosting innovation and promoting job creation, the Reserve Bank of
India said start-ups can raise external commercial borrowings of up to USD 3 million in a
financial year.
The government has managed to rake in Rs. 210 billion through stake sales and buybacks
in April-September this year, the highest-ever first half disinvestment revenue for any
year by a good margin, thus, raising expectations for the rest of 2016-17.
After growing at the fastest clip in 13 months in August, the widely-tracked Nikkei
Purchasing Managers’ Index showed a reading of 52.1 in September, declining
marginally from 52.6 in August 2016.
India’s largest-ever spectrum auction kicked off with major telecom operators placing
bids worth Rs. 535.31 billion across bands, even as the premium 700 Mhz and 900 Mhz
frequencies did not find any buyer.
Union Power Minister said so far Rs. 1.67 trillion worth of bonds have been issued under
the Ujjwal Distribution Assurance Yojana and it is now hot property and in demand.
The Government reduced the prices for domestically produced gas to USD 2.50/mmbtu
for the period October-March 2017 period on gross calorific value basis. It was earlier
priced at USD 3.06 /mmbtu.
Petrol price was hiked by 36 p/l, the third increase in two months, but that of diesel was
cut by 7p/l in line with international trends.
Fiscal deficit in the first five months of the current fiscal stood at Rs. 4.08 trillion, which
was 76.4% of Budget estimates for 2016-17.
India’s largest-ever spectrum auction kicked off with major telecom operators placing
bids worth Rs. 535.31 billion across bands, even as the premium 700 Mhz and 900 Mhz
frequencies did not find any buyer
✍ TOP CORPORATE NEWS -
Jain Irrigation Systems Limited has secured orders aggregating Rs. 2.84 billion under
the AMRUT (Atal Mission for Rejuvenation and Urban Transformation) scheme.
Zee Entertaining Enterprises Limited has revived talks with Reliance Broadcast
Network to acquire the latter’s radio and television business.
Bharat Heavy Electricals Limited has bagged two renovation and modernisation orders
of hydropower plants worth Rs. 4.30 billion, including one from NHPC.
Anil Ambani-led Reliance Group and Rafale maker Dassault Aviation announced a joint
venture that will be a "key player" in execution of offset contract worth about Rs. 220
billion as part of the fighter jet deal.
Larsen and Toubro Limited has bagged orders worth Rs. 60.24 billion across various
business segments.
Gayatri Projects Limited has bagged Rs. 9.26 billion highway road construction
contract in the state of Bihar. The contract involves four-laning of Gaya-Hisua-Rajgir-
Nalanda-Bhiarsharif section of NH-82.
NTPC Limited paid a total dividend amounting to Rs. 27.62 billion at the rate of 33.50
% of its paid-up capital for the financial year 2015-16. The dividend payment is 4th
highest among Public Sector Undertakings.
Mahindra CIE Automotive Limited is amongst the handful of companies who have
shown interest in buying business assets of Amtek Auto Limited.
RBL Bank Limited has acquired 9.99% stake in Utkarsh Microfinance in a bid to reach
out to consumers in unbanked areas. RBL has also entered into a memorandum of
understanding to extend its product portfolio to Utkarsh customers.
Vedanta Limited would invest around USD 250-300 million in expanding Hindustan
Zinc’s capacity. The company also said for other businesses the focus would be utilising
the existing facilities, instead of going for green field ones.
Edelweiss Asset Reconstruction Company has acquired loans worth Rs. 10 billion
extended by Axis Bank Limited to Essar Steel as part of aggregating credit exposure to
the ailing steel company.
Transocean said the Reliance Industries Limited has terminated the contract for its
'Discoverer India' ultra-deepwater drillship, effective December 2016.
Bharat Electronics Limited said its Rs. 21.71 billion equity shares buyback offer will
open on October 6.
Shilpa Medicare Limited has received US health regulator’s nod to sell Azacitidine
injection, used in the treatment of myelodysplastic syndrome, in the US market.
Indian Oil Corporation Limited plans to invest Rs. 180 billion to raise capacity of its
Panipat refinery in Haryana to 25 MT by 2020, larger than previously planned.
Larsen & Toubro Limited has synchronised first 660 MW unit of the 1,320 MW
thermal power project at Chhabra in Rajasthan.
Indian Oil Corporation Limited is planning to lay a 2,000 KM pipeline to carry
liquefied petroleum gas LPG from its Kandla import terminal on the west coast to
Gorakhpur in the deep east to cater to growing demand for cooking gas in the country.
Wockhardt Limited said the US FDA had excluded Ceftriazone Sodium from import
alert issued earlier against its active pharmaceutical ingredient manufacturing facility at
Ankleshwar.
✍ TOP BANKING AND FINANCIAL NEWS OF THE WEEK
Shares of ABG Shipyard rose 9.2% after the company announced that the private lender,
ICICI Bank Limited, acquired 11% stake in the company by converting its debt into
equity. Lenders now have 49% stake in the company and are actively scouting for an
investor to sell their stake. Other lenders such as State Bank of India and Punjab National
Bank have 7% stake each by converting debt into equity. After the company failed to
repay their dues and infuse capital into the company to sustain its operations, lenders
appointed investment banker Rothschild to find a buyer for their 49% stake. The
company has outstanding loans of Rs 16400 crore.
Transmission of interest rate cuts by banks has not been up to the mark despite the 150
basis points rate cut by the Reserve Bank of India since January 2015 but the central
bank hopes the recent cuts in small savings rates will lead to lower deposit rates and
ultimately will reduce borrowing rates, Governor Urjit Patel said on Tuesday. One basis
point is 0.01 percentage point. The RBI has introduced the new marginal cost of lending
rate methodology for setting interest rates since April, which takes into account the cost
of funds by banks both from deposits as well as market borrowings. Patel said it is hoped
that the new methodology will lead to a better regime. “I agree that the transmission to
bank borrowers has been less than what anyone of us would have liked it to be. And we
are hoping that over the next quarter or two, also keeping in mind that the government has
also reduced the small savings rate the MCLR calculation itself will throw up more
transmission, In its biannual monetary policy report released along with the policy on
Tuesday, the RBI said fixed rates on savings account deposits, sticky small savings rates,
stressed asset quality of banks and sluggish demand for bank credit are impeding
transmission of interest rates.
ICICI Bank Limited has cut its marginal cost of funds based lending rate by 5 basis
points effective from October 1, just hours after the RBI reduced its benchmark repo rate
by 25 basis points to 6.25%. One year lending rate of the bank is now 9.05% while the
one month and three month rate is identical at 8.85%. The new MCLR regime, which was
implemented from the current fiscal year, applies to all new borrowers and is closely
linked to bank deposits rates. All new floating rate loans are now linked to MCLR. The
key difference between MCLR and the previous base rate regime is that the new rates are
divided into different baskets corresponding to bank deposits.
In a good news for consumers ahead of Diwali, bankers promised to swiftly pass on the
0.25 per cent rate cut effected by the Reserve Bank to borrowers, a move that would
lower home, auto and corporate loans. For the busy season of the financial year, a cut in
repo rate by 25 basis point is indeed a welcome sign. With MCLR already stabilised, the
pass through of this cut is expected to be quite swift," said Dena Bank CMD Ashwani
Kumar who is also chairman of Indian Banks' Association. SBI Chairperson Arundhati
Bhattacharya said: "With benign inflation trajectory going forward, RBI's policy stance is
expected to remain accommodative. Banks will continue to transmit rates based on
evolving liquidity scenario." ICICI Bank Managing Director and CEO Chanda Kochhar
said rate cut will boost investment as well as consumption.
The Reserve Bank of India may tweak its policy of infusing cash into the banking
system if there is an increase in overseas investments in India, Governor Urjit Patel
suggested at a closed-door conference call with researchers. The central bank has added
cash in the system by conducting open market operations through government bond
purchases in the recent past, helping to pass on the benefit of earlier rate cuts to
borrowers.
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public appearance;
Disclosure in terms of Compensation:
High Brow Market Research Investment Advisor Pvt. Ltd. policy prohibits its
analysts, professionals reporting to analysts from owning securities of any
company in the analyst's area of coverage.
Analyst compensation: Analysts are salary based permanent employees of High
Brow Market Research Pvt. Ltd.
Disclosure in terms of Public Appearance:
(a) High Brow Market Research Pvt. Ltd. or its associates have not received any
compensation from the subject company in the past twelve months;
(b) The subject company is not now or never a client during twelve months
preceding the date of distribution of the research report.
(c) High Brow Market Research Pvt. Ltd. or its associates has never served as an
officer, director or employee of the subject company;
(d) High Brow Market Research Pvt. Ltd. has never been engaged in market
making activity for the subject company.
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