ICICI Bank after market hours yesterday, 25 June 2015, announced a reduction of 5 basis points (bps) in its base rate to 9.70% per annum (pa) from 9.75% with effect from 26 June 2015. With effect from 1 July 2010, interest rates on new loans and advances, including consumer loans, are determined with reference to the bank's base rate, ICICI Bank said.
Bank stocks will be in focus after the Reserve Bank of India (RBI) said in its half yearly Financial Stability Report (FSR) June 2015 published yesterday, 25 June 2015, that while risks to India's banking sector, as reflected by the Banking Stability Indicator and Map, have moderated marginally since September 2014, concerns remain over the continued weakness in asset quality indicated by the rising trend in stressed advances ratio of scheduled commercial banks (SCBs), especially of public sector banks (PSBs). Macro stress tests suggest that current deterioration in the asset quality of SCBs may continue for few more quarters and PSBs may have to bolster their provisions for credit risk from present levels, to meet the 'expected losses' if macroeconomic environment were to deteriorate under assumed stress scenarios. However, capital to risk weighted assets ratio (CRAR) of SCBs, at system level, was observed to remain above the regulatory minimum even under adverse macro-economic conditions assumed in these tests.
The report notes that while the regulatory move towards encouraging greater market access and market discipline will help the development of domestic financial markets, the banking sector, especially the PSBs will be expected to continue to shoulder the needs of the accelerating growth in the economy. In this context, the policy initiatives for improving the governance and management processes at public sector banks become significant.
IndusInd Bank is reportedly set to raise about Rs 5300 crore by selling fresh shares to institutional investors as well as its promoters.
DLF reportedly plans to cut its debt by a third by raising Rs 7000 crore through two private equity deals and two real estate investment trusts (REITs) in the next 18 months.
Nestle India will be watched after media reports suggested that the company's scientists are hard at work on an alternative snack that can take the place of Maggi noodles, banned this month for excessive lead content and mislabelling. The snack could be in the form of ready-to-eat or ready-to-cook food and involve relaunching Maggi in a new format with requisite clearances.
KPIT Technologies announced after trading hours yesterday, 25 June 2015, that during the company's last earnings call held on 29 April 2015, it outlined its proposed actions in the areas of profitability and growth. The company stated that during this year it will first focus on actions for improvement of profitability. In the last 2 months, the company has executed on a large number of these actions. As menticifled in the said call, the results of these actions would be seen from Q3 December 2015 onwards.
The company's revenues from Business IT solutions (Sap, Oracle etc.) as well as engineering services have shown a steady state in the quarter. During Q4 March 2015, the company had significant revenues from Products & Platforms business which included a large chunk of revenue from Intelligent Transportation Solutions (ITS). This is a seasonal business, where the firm expects to see decline in this quarter as compared to last quarter. As a result of this the company expects a marginal decline in overall revenues of Q1 June 2015 sequentially and consequent decline in profits. The company's yearly outlook on Products & Platforms is positive and it should see annual growth in this business, the company said in a statement.
The company said it has come across some rumors in the market about the company, which it strongly denies. The institutional holding in the company is steady and has actually marginally gone up in the recent weeks. The promoters have no plans to sell any stake. The company has declared 55% dividends and the same will be processed as per regulations. The company is in the process of taking appropriate legal steps as regards these rumors, the company said.
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