Pure play consumption stocks have been on a rising spree for the past many months and they have outperformed benchmark indices by a huge margin.
The green-shoots of demand growth seen in some rural pockets is driven by farm loan waivers and not likely due to real increases in rural incomes and wages, indicative that the economy is still some time away from a full-blown rural revival, says a report. Noting that rural demand has been on the rise in recent months, the report says the upward trend is visible from the sale of big-ticket items like tractors and the latest corporate earnings of consumer goods companies.
The states have failed to meet their gross fiscal deficit target for the third consecutive year, the Reserve Bank of India (RBI) said on Thursday. Higher expenditure on salaries and farm loan waivers, along with revenue shortfall on GST implementation, led to a slippage of 0.35 per cent to 3.1 per cent in 2017-18, the central bank said, adding this comes despite expectations of an improvement on higher devolution from the Centre.
The National Company Law Tribunal (NCLT), which upheld the removal of Cyrus Mistry as chairman of Tata Sons, said an executive chairman does not enjoy a free hand and that he also cannot assume that majority shareholders and the board would be at his “beck and call”.
In a 368-page order, which was made public today, the bench also said Mistry’s wrong assumption that he had a free hand to run the affairs of the Tata Group perhaps caused all the problems and that Tata Sons board was “competent” to remove its chairman.
Investors seem to be getting risk averse as they move to frontline stocks on the back of a possible escalation in trade war between the US and China. High oil prices are another worry point. While mid and small cap stocks face a rout, select buying in frontline stocks in sectors like auto, IT and consumption has lifted the Sensex to its record high level.
BSE Sensex on Thursday hit a new high of 36,699.53 points, surpassing the January 29 high of 36,443.98.
The shares of software giant Tata Consultancy Services touched a new 52-week high and closed with 5.47 per cent gain as investors cheered faster revenue growth in the first quarter and earnings beat.
The stock closed at Rs 1,979.60, up Rs 102.60, on the BSE and its market cap rose above Rs 7.50 lakh crore for the first time to Rs 757,904.45 crore, making it far bigger than any other listed Indian company. TCS added Rs 39,281 crore to its market cap on Wednesday.
Arevival in the core client segment and key operational geographies, along with some help from currency gains, helped TCS to report a 23 per cent jump in its June quarter net at Rs 7,340 crore.
The Tata Group flagship and India’s largest software exporter on Tuesday said its total income clipped at 15.8 per cent to Rs 34,261 crore under the new accounting standards.
The emerging digital segment saw a massive 44 per cent spike in revenue compared to the preceding quarter and now contributes a fourth of the total income.
The Reserve Bank of India on Tuesday said it will continue with the three-day meeting format of the Monetary Policy Committee (MPC) which decides on the key interest rate. The MPC, headed by RBI Governor Urjit Patel, used to meet for two-days, but last the meeting was stretched to three days owing to “certain administrative exigencies”.
The RBI said that the MPC “has decided to continue the practice of a three-day meeting format commencing on July 30, 2018 as was adopted in the meeting for the Second Bi-monthly Monetary Policy Statement of June 6, 2018”.
With the tax function evolving at a rapid pace over the last few years 78 per cent respondents believed they are not adequately prepared for the new avatar of tax function, according to a study.
The National Company Law Tribunal (NCLT) on Monday dismissed pleas of Cyrus Mistry challenging his removal as Tata Sons chairman.