Sensex ends 308 pts lower post RBI policy, Nifty near 19,550; Zee zooms 20%

CLOSING BELL ON AUGUST 10, 2023: Private bank and select auto stocks ended with notable losses after the RBI on Thursday asked banks to maintain Incremental Cash Reserve Ratio (ICRR) at 10 per cent.

SI Reporter New Delhi

2:17 PM

Disa India zooms 20%, hits new high as profit more than doubles in Q1FY24

The company's revenue from operations grew 41 per cent to Rs 90.69 crore from Rs 64.19 crore in the corresponding quarter of previous year. EBITDA margin improved to 20.4 per cent from 14.0 per cent. READ MORE

2:09 PM

COMMENT:: Facilitating conversational payments on UPI will have a transformative impact on digital payments

Keeping the policy stance unchanged at 'withdrawal of accommodation', revising the CPI estimate and reiterating the commitment to align inflation to the targeted level reflect RBI's cautious approach as well as hawkish guidance.

Having said that, one of the encouraging developments that came out of the policy announcement is the government's focus on leveraging technologies to boost digital payment ecosystem and customer experience. Offline payments in UPI will add to the customer convenience and on the other hand, facilitating conversational payments on UPI through artificial intelligence is a futuristic move and will have a transformative impact on digital payments.

- Aditya Damani, Founder & CEO, Credit Fair

1:59 PM

ALERT:: 3M India Q1 net jumps 45%; stock rallies 3%

3M India Q1 net profit jumped 45.4 per cent to Rs 116.67 crore for the quarter ended June 2023 when compared with Rs 80.25 crore in the year ago quarter. Total income incresed by 9.9 per cent YoY to Rs 989.69 crore.

1:51 PM

RBI Policy reaction :: 'Next rate action will be a cut in April 2024'

While vigil is warranted on the trajectory of the monsoon and impact of El Niño, we expect the policy rate to remain unchanged in CY23, with the next policy move likely to be a rate cut in Apr’24 as headline inflation moderates. Mortgage interest rates have hardened in recent months, but are likely to remain unchanged for the rest of CY23 as the policy rate stays stable.

Views by: Prasenjit Basu – Chief Economist, ICICI Securities

1:51 PM

ALERT:: IPCA Labs Q1 net rises 19%; stock down 1%

IPCA Labs Q1 net profit rose 18.9 per cent to Rs 166.58 crore for the quarter ended June 2023 when compared with Rs 140.07 crore in the year ago quarter. Total income was up 2.4 per cent YoY at Rs 1,531.87 crore.

1:43 PM

COMMENT:: Likelihood of an imminent rate cut appears diminished

The prediction of FY24 CPI inflation rising to 5.4% has made it less likely for interest rates to be lowered in the current calendar year. This change indicates a possible shift in focus towards addressing higher inflation, rather than considering rate cuts. We need to Keep an eye on future updates as the situation evolves.

The rate cut cycle might be delayed, as the Monetary Policy Committee (MPC) reaffirms its dedication to maintaining the 4% inflation target. This suggests that the focus remains on controlling inflation before considering any reduction in interest rates.

Given the MPC's renewed commitment to maintaining the 4% inflation target and the recent revision of FY24 CPI inflation forecast to 5.4%, the likelihood of an imminent rate cut appears diminished. The central bank's emphasis on addressing inflation concerns suggests that any rate cut could be delayed until a more stable economic environment is achieved. However, the exact timing of future rate cuts remains uncertain and will depend on the evolving economic conditions and inflation outlook.

- Kaushik Mehta Founder & CEO of Ruloans Distribution

1:34 PM

COMMENT:: Short-term rates may see some upward pressure due to ICRR steps

“As expected, RBI maintained status quo on policy rates. It increased the headline CPI projection for FY24 to 5.4% from 5.1% earlier on account of current increase in headline inflation, and re-emphasized its intention of bringing inflation to a level of 4% on a durable basis. The liquidity surplus is around Rs 2 lakh crore presently, as a result of return of 2000 denomination rupee notes to the banking system, withdrawn earlier. Therefore, the RBI introduced a temporary incremental CRR (ICRR) of 10% on incremental NDTL between mid-May and July 2023, and it will be reviewed on September 8, 2023—ahead of the festival season.

The central bank also introduced a transparent framework for resetting of interest rate for floating rate loans, which will bring some uniformity, and is a positive step for borrowers. Given the recent inflationary pressures in India (due to higher vegetable and cereal prices), elevated global monetary policy outlook, and RBI’s commitment to bring down domestic inflation to 4%; rate cut expectations have been further pushed back and will depend on evolving data. Short term rates may see some upward pressure in the near term due to ICRR steps. We are presently positive on the medium to long term part of the yield curve.”

- Sampath Reddy, Chief Investment Officer, Bajaj Allianz Life

1:27 PM

ALERT:: TVS SriChakra Q1 net dips 15%; stock up 2%

TVS SriChakra Q1 net profit dipped 14.9 per cent to Rs 18.66 crore for the quarter ended June 2023 when compared with Rs 21.92 crore in the year ago quarter. Total income declined by 6.1 per cent YoY to Rs 672.02 crore.

1:17 PM

Asian Market Update:: Nikkei gains 0.8%; Taiwan slips over 1%

Source: Yahoo Finance

1:10 PM

Comment :: 'Actual inflation in Q3 maybe lower than RBI forecast'

>> An incremental CRR of 10% of NDTL will be applied on additional NDTL attained between 19th May 2023 and 28th July 2023 by the banking system. The governor didn't specify the exact amount, but mentioned that it would be more than Rs1 trillion (our calculations suggest ~Rs 1.3 trillion). This compares with an avg liquidity surplus of Rs 1.8 trillion in Jul'23. Additional CRR will be reviewed on or before 8th September.

>> The incremental CRR was unexpected and a reduction in liquidity surplus represents monetary tightening. We expect no further hikes in interest rates in India and also believe that actual inflation in Q3 could be lower than RBI forecasts

Views by: Nikhil Gupta, Chief Economist, MOFSL Group.

12:59 PM

Should you subscribe to TVS Supply Chain IPO? Here's what brokerages say

According to ipowatch.in, shares of TVS Supply Chain Solutions enjoyed 15 per cent premium in grey markets, implying a likely listing price of Rs 227 apiece on the upper price band. Upon listing, it will join listed peers like TCI Express, Mahindra Logistics, Blue Dart, and Delhivery. READ MORE