India’s Industrial Output Grows 5.7% in July, Highest in Five Months
India’s industrial output grew by 5.7 percent in July, the highest in five months. This is above the consensus estimate of 5 percent and comes after a revised growth of 3.8 percent in June.
The growth was supported by an improvement in the output of all three sectors – mining, manufacturing, and electricity. Mining output was the highest in 14 months, while electricity production was at a five-month high. Manufacturing sector output grew by 4.6 percent, up from 3.1 percent in June.
However, the performance of the manufacturing sector has raised questions among economists, as the quarterly GDP data shows that growth in the gross value added of the sector was 4.7 percent in April-June, only slightly higher than 4.5 percent in January-March and lower than 6.1 percent in April-June 2022.
In terms of the use-based classification of goods, the July numbers showed more of the same. Capital goods production was 4.6 percent higher, while output of infrastructure goods rose by double-digits for the fourth month in a row. However, consumer durables output contracted again, this time by 2.7 percent, although that of non-durables surprisingly increased by 7.4 percent.
According to economists, the sharp rebound in consumer non-durables will have to be monitored, as the festive season is likely to provide a fillip to consumption demand in the near term. Over a longer period of time, unfolding of the domestic demand scenario remains critical for industrial activity. The elevated food inflation and monsoon-related vagaries could pose a risk for consumption demand.
- 22 Sep
HDFC Bank stock expected to re-rate in next 12-18 months, says Motilal Oswal’s Nitin Aggarwal
Aggarwal is bullish on HDFC Bank's long-term prospects, but he believes that investors should wait and see how the bank executes in the near term.
- 22 Sep
Sai Silks’ IPO attracts lukewarm response, analysts raise concerns
Sai Silks Kalamandir's IPO received a lukewarm response with a subscription rate of just 0.07 times. Analysts have raised concerns about the company's high debt levels, intense competition in the industry, and the fact that half of the issue size is an OFS. The company also has 30 percent of its promoter holdings pledged. Despite these concerns, the company's management is confident about its growth prospects.
- 22 Sep
PSU bank shares make a comeback on JPMorgan’s index inclusion decision
PSU bank shares made a strong comeback on September 22, after JPMorgan's decision to include Indian government bonds in its emerging-market index boosted investor sentiment. However, analysts are urging caution with regard to the PSU bank space, citing the risks of investing in smaller PSU banks and the potential for divestment in some of the larger banks. Investors should carefully consider the risks and rewards before investing in PSU bank shares.
- 22 Sep
SEBI penalizes 11 entities for non-genuine trades in illiquid stock options segment
The Securities and Exchange Board of India (SEBI) has penalized 11 entities for non-genuine trades, fined 2 entities for flouting disclosure rules, and suspended the registration of 1 research firm for violating regulatory norms. SEBI's actions are a reminder to market participants that they must comply with all regulatory requirements. Investors should be aware of these risks and take necessary precautions to protect themselves.
- 22 Sep
Zaggle Prepaid Ocean Services Stock Makes Weak Debut, Analysts Recommend Selling
Zaggle Prepaid Ocean Services stock made a muted debut on bourses on September 22, listing at a premium of just 0.6% over the IPO price. Analysts have recommended selling the stock on the opening day, citing its high P/E valuation, debt-to-equity ratio, and negative cash flow.