BQuick July 16: Top 10 Stories In Under 10 Minutes
This is a roundup of the day’s top stories in brief.
1. Hindustan Unilever’s Profit Rises On Better Sales Volume
Hindustan Unilever Ltd.’s profit met analyst estimates in the quarter ended June aided by double-digit growth in sales volumes.
Net profit of India’s largest fast-moving consumer goods manufacturer rose 19.2 percent from the year-ago period to Rs 1,529 crore, according to the company’s exchange filing. That’s in line with the Rs 1,540 crore estimated by analysts tracked by Bloomberg. Revenue rose 11 percent to Rs 9,487 crore, missing the estimated Rs 9,669 crore.
Sales volumes rose 12 percent year-on-year, also in line with estimates.
Read more on whether the company expects consumer demand to improve.
2. LIC Board Gives Nod To IDBI Bailout
The board of Life Insurance Corporation of India today approved a proposal to buy up to 51 percent stake in IDBI Bank Ltd.
The government-owned lender needs capital, and so the preferred option for the stake purchase is a preferential issue of shares, Department of Economic Affairs Secretary Subhash Chandra Garg told reporters in New Delhi. The government's stake, which is presently at 86 percent, will come down below 50 percent through issue of fresh equity by IDBI Bank.
The deal will now need the approval of IDBI Bank’s board, said Garg who also is the government’s representative on LIC’s board. The IDBI Bank board will meet soon to consider the investment proposal, Bloomberg News reported. The bank needs significant amounts of capital to provision against these loans, which it is unable to generate internally despite recent sales of non-core assets.
3. TRAI Wants You To Own Your Data, Not Some Company
Rules for protection of personal data in the telecom space are not sufficient, regulator TRAI said today while suggesting that consumers be given the right to choice, consent and to be forgotten, to safeguard their privacy.
Recommending a series of measures of “privacy, security and ownership of data in telecom networks,” the Telecom Regulatory Authority of India held that consumers are owners of their data and that entities controlling, processing their information are “mere custodians and do not have primary rights over this data”.
Here are the key data privacy recommendations made by the regulator.
4. Indian Markets Close Lower, Global Stocks Drift
Indian equity benchmark S&P BSE Sensex Index ended lower after posting a record high last week. The benchmark indices in India today followed Asian peers after mixed economic data out of China spurred declines.
Sensex closed 0.6 percent lower at 36,323.77 while the NSE Nifty 50 Index closed at 10,936.85, down 0.7 percent.
Follow the day’s trading session in India here.
U.S. equities drifted between gains and losses and European stocks were mixed as traders looked toward company results after lackluster economic data out of China prompted declines for many Asian shares. The dollar weakened against most peers.
Earnings were better-than-expected from the likes of Bank of America Corp. and BlackRock Inc. while there was an upbeat early release from Deutsche Bank AG, but it did little to spur stocks. The S&P 500 traded on either side of the 2,800 level, and most industry groups fell on the Stoxx Europe 600 Index, overwhelming gains by builders and banks.
For your fix of global markets, click here.
5. ICICI Bank Has Postponed Its AGM By A Month
ICICI Bank Ltd. has decided to postpone its annual general meeting by a month amidst an independent enquiry conducted by Justice BN Srikrishna on alleged cases of impropriety against the bank's CEO Chanda Kochhar.
The meeting has been rescheduled to Sept. 12 as against the earlier schedule of Aug.10. “We wish to update that the change in AGM date and the consequent changes in record dates was necessitated due to the sequencing of general meeting dates within the listed entities of ICICI Group,” the bank said in filings to the stock exchanges.
6. India’s Wholesale Inflation Near A Five-Year High
India’s wholesale price-based inflation jumped to its highest level in more than four years last month on rising fuel prices, surpassing street estimates.
Inflation, measured by the Wholesale Price Index, stood at 5.77 percent last month, according to a Ministry of Commerce and Industry release. A Bloomberg poll of economists had estimated it to be around 5.23 percent. June’s inflation figure was highest since December 2013 when it stood at 5.88 percent.
Here are the key highlights:
- India June primary article prices rose 5.3 percent, year-on-year.
- May fuel, power, lighting prices rose 16.18 percent.
- Manufactured product prices rose 4.17 percent.
- Food articles prices rose 1.8 percent.
- April WPI revised to 3.62 percent from 3.18 percent.
7. Truckers To Go On Nationwide Indefinite Strike Starting Friday
Truckers’ body All India Motor Transport Congress today called for a nationwide indefinite strike starting Friday on protests that the government has failed to address the industry’s key concerns.
The body, which represents the interests of 93 lakh truckers nationwide, has received the support of all state-, district- and taluk-level transporters, which could then impact the supply of goods to a large extent, Bal Malkit Singh, chairman-core committee, AIMTC, told reporters in Mumbai.
Read more about the truckers’ demands.
8. Why This Market Expert Is Betting On A Social Revolution In India
India’s digital leap – consisting of a combination of Jan Dhan, Aadhaar, rising mobile penetration and a Goods and Services Tax regime – is generating deep social impact, promising reduced income inequality, increased financial inclusion, better quality of life, and higher agricultural productivity, writes Ridham Desai, managing director at Morgan Stanley India.
India is in the midst of a transition from an annual per capita income of $1,700 to $4,135 (our projection) over the next 10 years. Just to put in context what low per capita income signifies, we note that some Indian companies talk about how basic necessities, such as fruit, are still classified as discretionary consumption, with the biggest competition to such consumption being non-consumption, suggesting that affordability remains low in India.
9. Mohamed El-Erian Decodes Trump’s Trade Strategy Using Game Theory
Financial markets were of two minds last week about the impact of mounting trade tensions between China and the U.S.
On the one hand, the escalating tit-for-tat tariffs still affect only a relatively small part of the two countries’ economies. The consensus baseline remains that the measures should not have a significant and lasting downward impact on the economy and stocks and, ultimately, may help bring about trade that is still free but fairer.
On the other hand, each escalation (the latest is the July 10 announcement by the Trump administration of its intention to impose import duties on an additional $200 billion of Chinese products) increases the market’s downside risk scenario of slipping, either on purpose or inadvertently, into a full-blown trade war that would significantly damage corporate earnings and the overall growth outcome.
And there is a third possible scenario for international trade that hasn't yet captured the attention of markets: A “Reagan Moment” that has an upside, though it is less probable than the downside scenario, that goes beyond tweaks to the existing system by delivering changes in the overall global economic landscape that favor the U.S. in both relative and absolute terms.
Making firm predictions on the probability distribution of these three possible outcomes is challenging. The answer will depend on a lot more than just economics and finance. Domestic politics also play an important role, and the current polarized environment adds to the complexity of reconciling competing expectations with reinvigorated global harmony.
Here are some insights from game theory on what to watch and expect.
- An inherently cooperative game is increasingly played uncooperatively.
- Further escalation is the most likely outcome for now.
- The game is inherently unbalanced.
- China will likely ultimately agree to some U.S. requests.
- Public accusations and counter-accusations make trust difficult.
- You can get there faster through coalition-building.
- Implementation is trickier than design.
For more each of these seven insights read this.
10. Airline Passengers Are Split Over Using Phones In The Air
Whether you regard your next flight as a chance to kick back and relax or a valuable window to catch up on lost work may depend on where you live, according to a survey of 8,000 passengers in 10 key travel markets.
While airlines seem determined to keep passengers connected 24-7, most people from France, Germany, Japan, Sweden, Britain and the U.S. are happy to have their phones rendered unusable while en route, the poll suggests. Indian, Chinese and Arab passengers, by contrast, are generally keen to make calls.
Click here for more on Nielsen’s findings.