Indian Economy-News & Updates

[kawaraj]

denial, denial, and denial, will you guys be with the reality?

India Inc's FY12 defaults highest ever - The Times of India

INR just touched 56.85, close to 57, record low and just the beginning phase.

 

[kkacer]

Fitch downgrades 11 financial institutions, including SBI, ICICI

BT Online Bureau June 20, 2012

Fitch has cut credit rating outlook for 11 financial entities including State Bank of India (SBI), ICICI Bank, Punjab National Bank (PNB) and Axis Bank.

The credit rating agency announced the revision of the outlook on the 'BBB-' Long-Term (LT) Foreign Currency (FC) Issuer Default Rating (IDR) of 11 Indian financial institutions to negative from stable.

The rating action follows Fitch's revision of the outlook on India's LT Foreign- and Local-Currency IDRs to negative from stable on Monday.

The financial institutions comprise of six government banks (including an international banking subsidiary of a government bank), two private banks, two wholly owned government institutions and one infrastructure finance company, the rating agency said in a statement.



The institutions that are affected by the revision are: SBI, PNB, Bank of Baroda, Bank of Baroda (New Zealand), Canara Bank, IDBI Bank, ICICI Bank, Axis Bank, Export-Import Bank of India, Housing and Urban Development Corp (HUDCO) and Infrastructure Development Finance Co Ltd (IDFC).

"The outlook revision of the financial institutions reflects their close linkages with the sovereign by virtue of their high exposure to domestic counterparties and holdings of domestic sovereign debt," Fitch said.

Should the Sovereign Long-Term IDR be downgraded, the banks with Viability Ratings (VR) of 'bbb-' would also be affected given the previously mentioned linkages.

Fitch is also of the opinion that pressures are building generally on the stand-alone credit profile of these institutions which will negatively impact VRs, given India's weakening economic and fiscal outlook, slowing business reforms and inflationary pressures that in turn could put further pressure on their future asset quality.

According to Fitch, there is some comfort from the banks' reasonable customer deposit base, established domestic franchises and adequate capitalisation.

"The non-banks, however, lack the funding advantage, which puts them more at risk during times of increased market volatility," Fitch said.

"In the agency's opinion, sovereign support for both the large banks and policy-type institutions is expected to remain strong, with the former benefiting from their large share of system assets and deposits and the latter from their association with the government," the rating agency added.

Fitch downgrades 11 financial institutions, including SBI, ICICI - Business Today

India FDI slumps 41% to $1.8b in April

NEW DELHI Reflecting slowdown in the economy and erosion of investor confidence, foreign direct investment (FDI) in India has declined by 41 per cent to $1.85 billion in April.

FDI inflows dip 8% this year

NEW DELHI: Global investors seem less bullish on India after a series of policy flip flops by the government sapped confidence. Latest data released by the Reserve Bank of India showed that foreign direct investment inflows slipped nearly 8% to $7.8 billion during January-April 2012.

Indian Rupee Drops To 56.155 near record Low On Inflow Concerns

Oman Tribune - the edge of knowledge

FDI inflows dip 8% this year - The Times of India

 

[cloud_9]

denial, denial, and denial, will you guys be with the reality?

India Inc's FY12 defaults highest ever - The Times of India

INR just touched 56.85, close to 57, record low and just the beginning phase.

[A link for you goo.gl/DWkwP ]

Rupee recovers from record low to end at 56.30 against dollar - The Economic Times

 

[shuttler]

Nearly 20% of $7-billion foreign currency convertible bonds face default risk this year, says Fitch

MUMBAI: At least 20% of the $7-billion foreign currency convertible bonds (FCCB) due for conversion this year face default risk as investors demand funds back due to stock prices languishing at less than half the stated conversion price, Fitch Ratings has forecast. Over 60% of such FCCBs are from the IT (34%) and pharma (30%) sectors.

he ratings firm says FCCBs of 59 companies are up for redemption this year. About 63% of the $7-billion FCCBs are likely to be redeemed; the companies concerned would finance it with a combination of internal accruals and fresh borrowings. About 17% of the FCCBs are likely to be restructured (mostly maturity extensions), according to Fitch. But the remaining 20% of the amount of 19 firms are likely to default with ensuing restructuring, possibly having significant distressed debt exchange (DDE) features.

The 19 companies who are most likely to default are: GTL Infrastructure, Subex, XL Energy, Gayatri Projects, Indowind Energy, Pokarna, Murli Industries, Sterling Biotech, Pyramid Saimira Theatre, KSL and Industries, 3i Infotech, Zenith Infotech, ICSA India, KLG Systel, Ankur Drugs & Pharma, Gemini Communications, Pioneer Embroideries, GV Films, and Wanbury.

Of the 31 corporates likely to redeem the FCCBs, five can use a financing option of their choice. The other 26, with a relatively weaker financial profile, would still be able to access low-cost European Central Bank, or ECB, funding or even high-cost domestic debt. The interest coverage of some of them would deteriorate due to their somewhat limited access to funding options.


The nine companies who are likely to restructure are experiencing stretched liquidity and stressed cash flows despite a reasonable business model. The ultimate FCCB payment is likely to be driven by the sale of identifiable, non-encumbered assets. Such FCCBs are most likely to be restructured involving a maturity extension but are unlikely to have significant distressed debt exchange features, Fitch said.

The remaining 19 companies are highly likely to default on FCCB payments or would restructure the FCCBs with significant distressed debt features.

Some of the FCCB investors have purchased credit protection measures, like credit-linked notes and credit default swaps, from various institutions, including the overseas branches of Indian banks. This may provide a motivation to some banks to provide ECB loans to some companies to refinance the FCCBs. In such an event, the redemption rate is likely to improve from the current estimated level of 63%.
.
Nearly 20% of $7-billion foreign currency convertible bonds face default risk this year, says Fitch - Economic Times

 

[Chinese-Dragon]

[A link for you goo.gl/DWkwP ]

Rupee recovers from record low to end at 56.30 against dollar - The Economic Times

The Rupee hit ANOTHER all-time low today.

Rupee hits all-time low of 56.57 - The Times of India

 

[SinoChallenger]

India nflation jumps to 10.36% in May

Jun 18, 2012

NEW DELHI: Vegetable prices recorded the maximum spurt in prices, up 26.59%, followed by edible oils 18.21% and milk products 13.74% in May, year-on-year basis. Prices of egg, fish and meat shot up 10.50%.

Prices of egg, fish and meat shot up 10.50%, while non-alcoholic beverages became costlier 9.44%.

Inflation rates for rural and urban areas were 9.57% and 11.52% respectively in May.

Retail inflation up to 10.36% in May

the inflation of India out of control?!

That's crazy. Vegetable prices shot up 30%. Pushing indians toward cannibalism.

 

[scorpionx]

That's crazy. Vegetable prices shot up 30%. Pushing indians toward cannibalism.

No darling, the salary also to be increased at a rate highest in the Asia Pacific.So dont worry, we will not eat u

Indian employees to get 11.9% salary hike in 2012: Survey | Day & Night News

 

[Abingdonboy]

So you think India is doing badly? Sample this:

China's growth rate in the second quarter of the year is expected to dip below 7%. India's growth rate has tended to be, in general, two to three percentage points below that of China. If India were to grow at 5% in the second quarter, that should not be a great shock.

Brazil, another of the BRIC economies, grew by just 2.7% in 2011, down from 7.5% in 2010. The IMF projects growth in 2012 at 3%.

Among the BRIC nations, Russia alone is poised to maintain its growth rate in 2012 but that is because Russia has been growing in the past two years at a relatively slower 4%.

You can't say that China's growth has slumped because of 'policy paralysis'. China does not face the difficulties that a democracy does. To get a better clue to the slump, just see when was the last time that its growth rate fell below 7%. China's growth was 6.6% in the first quarter of 2009, which was the worst time in the sub-prime crisis, following the collapse of Lehman Brothers.

The ongoing eurozone crisis is similar in intensity and in the risk-aversion it has created in the markets. It must explain why China's growth has decelerated so acutely and also India's. It tells us that it is global factors that are primarily responsible for India's economy running into rough weather not coalition politics, lack of leadership, corruption, assembly elections or any of the things we have been hearing about.

Unfortunately, it's not just commentators who don't get it but rating agencies and a section of the business community. What the latter think does matter. Rating agencies impact the flow of capital into the country and the costs of borrowing. Animal spirits are everything in an economy and businessmen's prophecies of doom tend to be self-fulfilling.

S&P warned recently that India faces a downgrade in its rating if it does not get its policy act together. It had changed the outlook from 'stable' to 'negative' in April. Now another rating agency, Fitch, has followed suit and the reasons it has cited are almost the same as those advanced by S&P.

S&P has sought to articulate its case for a potential downgrade in a report tiled, Will India be the first BRIC fallen angel? A credit downgrade reflects increased possibility of default on debt. Where a nation's debt is overwhelmingly in domestic currency, the chances of default are lower because government can easily inflate its way out of high debt. It is high external debt that is cause of concern. India's external debt to GDP ratio of 3.4% must be amongst the lowest in the world. Does S&P believe that, in the absence of reforms, the probability of India's defaulting on foreign debt will rise?

S&P, India Inc overdoing gloom on economy? - The Economic Times

 

[Chinese-Dragon]

China's growth target = 7.5%... China's actual growth = 8.1%

India's growth target = 9.5%... India's actual growth = 5.3%

Enough said.

 

[Abingdonboy]

China's growth target = 7.5%... China's actual growth = 8.1%

India's growth target = 9.5%... India's actual growth = 5.3%

Enough said.

Who targeted 9.5% for India??!!!

 

[Gandhi G in da house]

^^^ India's growth target has been revised , this year Indian is aiming for around 7.5 % . Anyway , what does China have to do with this thread ?

Always compare yourself with someone who is doing better not worse .

 

[Chinese-Dragon]

Who targeted 9.5% for India??!!!

The Indian government.

It was only last summer that the Indian government forecast that the economy would grow at an annual rate of 9.0% to 9.5% for the next half-decade. So it came as a shock Thursday when new data revealed the economy slowed to a 5.3% annual clip in the January-March quarter.

Review & Outlook: India Fades - Wall Street Journal

 

[Abingdonboy]

The Indian government.



Review & Outlook: India Fades - Wall Street Journal

Yes that was in Summer 2011 and based on info at the time this forecast was accurate- no one saw this Eurozone crisis hitting as hard as it had. Revised figures BASED ON CURRENT data are obviously much lower! I'm sure if we went back a year ago Chinese government would have different figures!



EPIC FAIL!


TROLL!!

 

[Gandhi G in da house]

The Indian government.



Review & Outlook: India Fades - Wall Street Journal

Chini doesn't understand the meaning of 'last summer'

Last summer India was growing at over 8 % , Last summer there was no major Euro crisis , hence the govt. was aiming for 9.5 %. But after the slow growth in 2011 and the Euro crisis , the latest aim for 2012 is for 7.5 % . Keep yourself updated and quit trolling . Do your position some justice.

 

[Chinese-Dragon]

Yes that was in Summer 2011 and based on info at the time this forecast was accurate- no one saw this Eurozone crisis hitting as hard as it had. Revised figures BASED ON CURRENT data are obviously much lower! I'm sure if we went back a year ago Chinese government would have different figures!

This.... was "accurate"?

It was only last summer that the Indian government forecast that the economy would grow at an annual rate of 9.0% to 9.5% for the next half-decade. So it came as a shock Thursday when new data revealed the economy slowed to a 5.3% annual clip in the January-March quarter.

Review & Outlook: India Fades - Wall Street Journal

-------------------------

Sounds more like a fairytale that has spun out of control.

Indian economy is in stagflation: Moody - The Hindu