India Week Ahead (Dec 3-9): RBI likely to keep rates unchanged
Indian market lost ground last week. The bears stopped its multi-week run. Key indices – Sensex closed down by 2.5%, Nifty lost 2.5%, Bank Nifty down by 2.2% and the volatility index was up 9.2% for the week. The top six losers for Nifty were Hindalco down 6.9%, Tata Motors down 6.6%, Vedanta down 6.3%, SBI down 6.2%, Aurobindo Pharma down 6.1% and HPCL down 5.2%.
Highlights for the week ahead:
RBI credit policy
The Reserve Bank of India's Monetary Policy Committee (MPC) will meet on Tuesday-Wednesday. MPC will announce it's result on Wednesday at 02:30pm. Most analysts expect RBI to keep rates unchanged.
According to ICRA inflation for October is lower than the 4.2-4.6% range that MPC had forecast in its previous review for H2FY18 and the recent revision in GST rates would ease price pressures but certain inflation risks persist. ICRA also maintained that based on the expected gradual rise in currency with the public and continued working capital-led uptick in credit off-take, liquidity situation is likely to be close to neutral by mid-December 2017, with sporadic deficits anticipated around the next advance tax payment dates.
Phase 1 of Gujarat polls
After winning civic polls in the Congress bastion Amethi, Uttar Pradesh the BJP will look to guard it's turf in Gujarat where it is in power for the last 22 years. The Congress is contesting the polls along with Patidar quota stir leader Hardik Patel. Speaking at an election rally in Gujarat BJP Chief Amit Shah said that the politics of caste has become a distant past for Gujarat. The state will not cast its votes on caste lines. BJP Chief is confident of winning 150 out of the state’s 182 assembly seats. Polling is scheduled in Gujarat for December 9 and 14, and results will be declared on December 18.
Bombay High Court to rule on NSEL merger
The Bomday High court will rule on the NSEL-FTIL merger on Monday. 63 Moons has challenged the government's draft order to merge NSEL with its parent FTIL in October 2014 on grounds, among other things, of vitiating the concept of limited liability. Government ordered merger post the Rs 5,600 cr NSEL scam surfaced in July 2013 after a payment default by two dozen counter parties, who raised funds from 13,000 investors on the exchange against contracts ostensibly backed by commodity stocks found to be absent. Outstanding dues to investors stand at over Rs 5,000 cr.
Next hearing in Vijay Mallya extradition case
From December 4, the Westminster Magistrates' Court will start hearing the extradition proceedings of Vijay Mallya. Indian government has conveyed to the Westminster Magistrates' court in London that the prisons in India are as good as in any other country in the world and prisoners' rights are fully protectedin Indian jails. Westminster court will be told that it is the duty of the state to ensure security of prisoners and Mallya's apprehension about threat to his life is "misleading".
Pre-budget consultations to kick off from Dec 5, FM to meet agriculture groups
With Union Budget barely 2 months away Finance Minister Arun Jaitley will start the consultation process for the budget formulation with meeting the agriculture groups first on Tuesday.
PTI reported on December 3 that Union Budget will be presented on February 1. The Budget session of Parliament may begin on January 30 with President Ram Nath Kovind addressing the Joint Session of both the Houses of Parliament. The Economic Survey, detailing the state of the economy, is likely to be tabled on January 31, this will be current government's last full Budget.
IPOs this week
Shalby Hospitals Ltd which runs a multi-speciality hospital chain will launch its IPO from Dec 5-7. The company is looking to raise Rs 504.8 cr. The price band of the IPO is Rs 245-248 per share for the IPO. The company will repay Rs 320 cr to retire debt and while the rest will be used for purchase of new medical equipments.
Future Supply Chain, the logistics arm of Future Group, will launch its IPO from Dec 6-8. The company is looking to raise Rs 650 cr. The price band is Rs 660-664 per share, the shareholding of Future Enterprises will drop by 5% to 53% post IPO.