IT SECTOR SLOWING DEMAND
Incremental credit slows down until mid-June
Incremental loans increased Rs 2.79 lakh crore or 1.7 % this fiscal year up to June 14 compared to Rs 3.48 lakh crore or 2.5 percent a year ago reflecting a slowdown in credit demand for investments as well as working capital needs- and indicator of level of economic activity.
TCS, HCL earnings recovery may get further push from AI demand
Indian IT companies like TCS and HCL are set to report on their earnings, showing signs of recovery amidst cautious spending by US and European companies. Retail giants Fast Retailing and Ryohin Keikaku are expected to see growth in operating profits. Keep an eye on LG Energy Solution's earnings amid lower demand for electric vehicles.
Sonam Udasi on three tactical sectors to be bullish on for near term
The pockets that seem cheaper today are large private sector banks, some IT, and the expectation that consumption may get a leg up post the budget. Those are the three tactical sectors we are looking at currently.
FPIs lap up realty stocks amid low inventories, sustained demand scenario
The increase in the weight of the sector can be attributed to capital appreciation and steady inflow of overseas funds. The Nifty Realty index has outperformed the benchmark Nifty 50 by 32% year-to-date.
Financials & utilities are the cheapest sectors; IT overpriced: Neelkanth Mishra
Neelkanth Mishra highlights undervalued financial and utility sectors compared to the overpriced IT sector. The Budget is expected to focus on rural support and fiscal prudence, with emphasis on Viksit Bharat 2047 initiatives. However, GDP growth may slow down, impacting FMCG sector earnings. Mishra expects consumption by the lower income households will grow slower than the GDP on average,
UK manufacturing growth slows as shipping delays hit exports, PMI shows
While output and overall new orders grew at close to their fastest pace in two years, export orders fell for a 29th successive month, due to the shipping delays and high freight costs.
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Look for stocks with less downward volatility and stable earnings prospects: Anand Tandon
A good content pipeline increases the likelihood of hits, and with people coming to the cinema, local F&B sales will also rise. From a tactical perspective, PVR's business outlook should improve significantly over the next 12 months. However, each month must be evaluated separately based on incoming content and audience reactions.
Strong ER&D demand helps IT buck overall soft hiring trend
India's $250 billion IT services industry is facing sluggish hiring, but a bright spot is emerging in Engineering, Research & Development (ER&D). Demand for ER&D services is surging, driving a 15% increase in recruitment for these roles. Staffing firms report that tech companies are ramping up ER&D hiring to stay competitive in the global market.
Strong demand in cement for next 1-2 yrs; 5 stocks to bet on: Ronald Siyoni
Ronald Siyoni, says there is an intention within the sector to go ahead with the cement price hike. We have seen about 1.5% odd price hikes during June on an average on a pan-India basis, but still, pan-India prices remain lower sequentially for quarter one of FY25 by about 3% to 4%.
Car dealers feel the load as sales slow, inventory piles up
Passenger vehicle makers seek a 90-day credit cycle extension from auto financiers due to pressure in retail and sales channels amid slowing sales.
World will amass 'major' oil surplus by 2030, says IEA
Global demand is expected to "level off" at 106 million barrels per day (bpd) toward the end of this decade while overall supply capacity could reach 114 million bpd, the IEA said in an annual report. This would result in a "staggering" surplus of eight million bpd that oil markets should prepare for, the Paris-based agency said.
PM Modi shows rural bent, OKs ₹20kcr for PM Kisan Nidhi Scheme
The Prime Minister approved the 17th instalment of the PM Kisan Nidhi Scheme, benefiting 93 million farmers with around ₹20,000 crore. This move is seen as a boost to rural demand and consumer stocks. The new coalition government is expected to focus more on rural welfare, signaling a shift towards consumption-focused policies. Rural markets have shown growth, outpacing urban markets for the first time in five quarters, indicating a positive trend for the FMCG sector. The PM emphasized the government's commitment to farmer welfare and agriculture.
India Inc cheers continuity at the Centre, but rues fragility
Indian industry leaders express confidence in the economy's resilience despite the NDA-BJP government's unexpected outcome without an absolute majority. They anticipate policy continuity but caution about potential hurdles due to a stronger opposition and diverse political ideologies. The focus may shift to consumption, welfare schemes, and rural sectors. Stability is crucial for reforms, but the BJP's shortfall could complicate passing contentious reforms. However, the economy's growth agenda is expected to continue, with an emphasis on inclusivity and job creation.
Job market recovery may slow, for now
The absence of a decisive mandate in the 2024 elections may impact job market recovery temporarily. Coalition partners will have a stronger voice in policy decisions, affecting investor sentiment. Experts anticipate a short-term slowdown in job creation.
Renewable industry workforce addition accelerates, attrition slows: Teamlease data
Strong growth in headcount underscores sector's expansion to meet global renewable energy targets and increasing demand for skilled workers
India's services sector softens to five-month low in May: PMI report
India's services growth slowed to a five-month low in May due to weaker domestic demand, despite record export growth and a 21-month high in job creation. The services PMI fell to 60.2 from 60.8 in April. Input costs rose, intensifying price pressures and possibly delaying interest rate cuts by the RBI.
Surge in credit demand will boost the banking sector: Ashish Gupta, Axis Asset Management
"We want to ensure that one style does not get imposed on all products and there is enough diversity of styles and products," says Ashish Gupta, CIO, Axis Asset Management.
Credit growth slows in April across major sectors
Bank credit growth is expected to moderate 200 basis points (one bps is 0.01 percent) to 14% this fiscal after an estimated robust growth of 16% in fiscal 2024, according to ratings firm Crisil. Strong economic activity and retail credit demand drove loan growth last fiscal. This fiscal growth will be tempered by a high base effect, a revision in risk weights and a somewhat lower gross domestic product growth, it said.
Strong demand tailwinds are for all the players: 5 small and midcap real-estate stocks with upside potential of up to 34%
Four years ago, the real estate industry was defined by excess inventory, over leveraged balance sheets and weak demand. Today, a housing project getting launched is getting sold within a few days. The average prices on a per square ft basis have inched upward very sharply in the last one year and still there is no dearth of demand. Now the question is whether this kind of sharp rise in demand is having an impact only on large players or also on mid-sized companies which are focussed in a region only. The fact is that in the case of sectors like real estate, when the tide of demand changes, it changes for every player, be it large or medium. Yes, when it comes to medium-sized players it would be important to look at the players where they have a track record of implementing projects on time. Delivering the project on time is key metrics which determines whether the company which is mid-sized today will become large or not in years to come. As the large ones have seen a sharp rise in the valuations, the focus of the street is now also on mid-sized by well managed companies.
China lays out 'historic' plans to prop up its realty market
Investors hoped the measures marked the beginning of more decisive government intervention to compensate for waning demand for new and old apartments, to slow down falling prices and to reduce a growing stock of unsold homes. Since the property market began its steep downturn in 2021, a string of developers have defaulted, leaving scores of idle construction sites behind, and sapping confidence in what had been the preferred savings instrument for the Chinese population.
China unveils steps to stabilise crisis-hit property sector
China announced significant measures to stabilize the struggling property sector. The measures included allowing local governments to purchase apartments, easing mortgage rules, and committing to finishing incomplete homes. These efforts aim to address declining demand, falling prices, and a surplus of unsold properties, with the hope of reviving a sector that once contributed significantly to the economy.
Merchandise exports likely to reach $500 bn in FY25, growth of labour intensive sectors a concern: FIEO
FIEO also said that while meeting the ambitious target of $2 trillion exports by 2030, requiring a CAGR of 12.7%, is challenging, it is within reach and can be achieved.
China expected to announce new measures to fix property crisis, spur growth
China's housing prices dropped in the first four months of the year, while factory output increased by almost 7%. This has lead to officials planning new measures to boost the struggling property industry. The National Bureau of Statistics noted insufficient domestic demand. The State Council announced a news conference to address the property market challenges, including defaults by developers.
FMCG companies to see muted demand in June quarter, recovery likely in H2
Overall volumes, which indicate the number of products consumers bought, expanded 5.2% in the March quarter, unchanged from the three months to December. Sales volumes in rural markets climbed 5.8%, and in cities by 4.7%, from a year earlier, data from Kantar showed. Kantar monitors branded and unorganised products, including unpackaged voluminous commodities. Nielsen, on the other hand, tracks primarily branded retail sales.
Inflation-wary Fed may put IT revival on hold
Indian outsourcing leaders face delayed business revival until FY26 due to US Federal Reserve's high interest rates. The impact on revenue growth and IT firms' strategies could persist, affecting deals and revenue projections in the sector.
India will remain a rewarding market on a bottom-up basis: Ashwini Agarwal
I think there was a lot of disruption in the rural disposable income on account of the disruption in jobs in the urban area on a post COVID basis. But I think with manufacturing picking up several of those jobs are coming back and those transfers from urban to rural India might be getting back.
Retail sector leasing to slow down in 2024
The sector recorded an all-time high leasing in 2023, taking 7.1 million sq ft across eight cities, which is expected to dip to 6-6.5 million sq ft in 2024, according to CBRE.
Services growth remained robust in February, but slowed slightly: PMI
Tuesday's survey injects a sense of optimism in the industry, the engine of economic growth and jobs, suggesting Asia's third largest economy will continue to grow at a world-beating pace this year after registering 8.4% last quarter.
Core growth hits 15-month low of 3.6% in January, high base weighs
The slow growth in the eight core industries - cement, coal, crude oil, electricity, fertilisers, natural gas, refinery products and steel - is likely to be reflected in industrial output as well. These sectors have over 40% weight in the Index of Industrial Production (IIP). "We could expect IIP growth to be 2-3% this month. We do not expect any resurgence in consumer goods production this month and hence (growth) will be muted," said Madan Sabnavis, chief economist, Bank of Baroda.
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