Gold enjoys a pre-eminent
position in the Indian culture from ancient times. It was continually targeted
by invaders for its prized gold treasures and was popularly known as “Sone ki
Chiriya”
( a bird of gold).
After such a long association with Gold as a status symbol, a measure of wealth, currency and the famed jewelry, are the Indians going to give up their lust just because the massive Current Account Deficit (CAD) run up is proving a major strain on the economy. The answer is a big No.
In a move to trim its debt and strengthen its balance sheet, Fortis is raising $355 Mn by selling 100% stake in Altai Investments Limited, the holding company of Quality Healthcare, Honk-Kong, to British medical services group, Bupa.
Its a good move as the company was purchased in Oct '10 for USD 193 Mio, netting a profit of $162 Mio.
Chandra officially took over in Oct '09 , so effectively was running TCS mid '09 and the importance of his leadership is clear both in results and in the valuations
On being asked late '07 where should he invest, I told a friend while dropping him back in moscow to play TCS / Infosys P/e gap as it will get bridged ...ddn't know this will be so emphatic :(
Infosys was the bellwether not just of IT industry but the whole stock market.
First one with results, It would set the pace every quarter, always ahead of estimates, sharing extensively they had analysts virtually eating out of their hands.
After 47 continuous quarters of delivering results above estimates, What happened to the famed Infosys and its management depth ?
The RBI with immediate effect has reduced the marginal standing facility (MSF) rate, at which banks borrow from it, to 9 percent from 9.5 percent - It will improve liquidity in the system
This is the second reduction in the rate since the 20 September mid-quarter monetary policy review, when it was lowered to 9.5 percent from 10.25 percent.
Interestingly the same rate was jacked up 2% in mid July to 10.25 per cent, to tighten liquidity in an attempt to curb volatility in the rupee-dollar exchange rate.
With this the RBI also announced that the bank rate will be adjusted to 9 percent with immediate effect
New 7 day & 14 Day tenor auctions i/o just overnight
The central bank also said it will provide additional liquidity through term repos of 7-day and 14-day tenor for a notified amount equivalent to 0.25 percent of net demand and time liabilities (NDTL) of the banking system through variable rate auctions every Friday, starting 11 October.
Earlier only overnight or 3 days (weekends) facility was available
Implications
1. Why sudden
- Either RBI Guv has a mind of his own and its showing or
- some other issues are there for which he is preparing for at double quick speed
- why reduce rates when inflation was the target ?
- last move was followed by Rupee depreciation , this time ??
2. It will improve liquidity & reduce borrowing costs
3. 7 day & 14 day repo will provide some certainty to the banks in the short run on their borrowing costs
4. Positive for the markets as of now
Foot note
The RBI injects about Rs 1.5 lakh crore into the system daily through the liquidity adjustment facility, the export credit refinance facility and the marginal standing facility.
Mailing List
Golden Rule
Rule No.1: Never lose money.
Rule No.2: Never forget rule No.1.
