The benchmark stock indices opened the day on a positive note ahead of RBI's interest rate decision.
Join us as we follow the top business news through the day.
India's Barbeque-Nation reverses course after weak opening on debut, jumps 18%
A quick comeback.
Reuters reports: "Shares of restaurant chain Barbeque-Nation Hospitality recovered early losses to rise 18% in their debut trading on Wednesday, helped by a rally in broader Indian markets on the central bank's decision to stand pat on key interest rates.
The Bengaluru-based casual dining restaurant chain, which offers unlimited barbecue buffets, raised about 4.53 billion rupees ($61.62 million) through an initial public offering (IPO).
Shares of Barbeque-Nation, which also operates the high-end Toscano eatery chain, opened at 489.85 rupees, below the offer price of 500 rupees. Stock recovered to trade up 17.6% after dropping as much as 3.6% in early session.
"The IPO did not have major demand during subscription in March as the company has been incurring losses in last three fiscal years, and overall, this isn't a good time for the whole restaurant sector due to a rise in coronavirus cases," Saurabh Joshi, an equity research analyst at Marwari Shares and Finance Ltd said.
"The recovery in shares was purely because the overall market was positive," he added.
The NSE Nifty 50 Index was up 0.93%, as of 0814 GMT, and the S&P BSE Sensex rose 0.95%, after the Reserve Bank of India kept interest rates at record lows but committed to a massive government bond purchase programme.
Barbeque-Nation's debut comes as a resurgence in coronavirus infections in India threatens to derail a nascent recovery in business for restaurants, malls and movie theaters. The chain competes with Mainland China and Oh! Calcutta-owner Speciality Restaurants in the fine dining space.
While Barbeque Nation's offering was oversubscribed about six times last month, it pales in comparison with the interest generated by some other listings this year including paint maker Indigo Paints Ltd, which was 50 times oversubscribed, and engineering firm MTAR Technologies Ltd, which was oversubscribed more than 100 times.
The restaurant chain, which has 138 outlets in India, had posted a net loss of 987.2 million rupees for the eight months ended November 2020, and an annual loss of 323.9 million for the year ended March 2020."
India has world’s 3rd highest number of billionaires, says Forbes report
India has the third highest number of billionaires in the world after the U.S. and China, according to a new list by the prestigious Forbes magazine, which said Reliance Industries Chairman Mukesh Ambani reclaimed his spot as Asia’s richest person, dethroning Chinese business tycoon Jack Ma who was the richest person in the region a year ago.
Forbes’ 35th annual list of the world’s billionaires is topped by Amazon CEO and Founder Jeff Bezos for the fourth year in a row.
His net worth is $177 billion, up $64 billion from a year ago as a result of surging Amazon shares, Forbes said.
RBI retains GDP growth forecast at 10.5% for FY'22
The central bank maintains its growth forecast.
PTI reports: "The Reserve Bank of India on Wednesday retained the economic growth projection for the current financial year at 10.5 per cent, while cautioning that the recent surge in COVID-19 infections has created uncertainty over the economic growth recovery.
In its last policy review, the RBI had projected a GDP growth rate of 10.5 pc for FY'22.
Taking various factors into consideration, it said, "the projection of real GDP growth for 2021-22 is retained at 10.5 per cent consisting of 26.2 per cent in Q1, 8.3 per cent in Q2, 5.4 per cent in Q3 and 6.2 per cent in Q4." In a statement after the first Monetary Policy Committee (MPC), RBI Governor Shaktikanta Das said the recent surge in COVID-19 infections adds uncertainty to the domestic growth outlook amidst tightening of restrictions by some state governments.
The RBI said that though the firms engaged in manufacturing, services and infrastructure sectors were optimistic about a pick-up in demand, "consumer confidence, on the other hand, has dipped with the recent surge in COVID infections in some states imparting uncertainty to the outlook." Das noted the recent surge in infections has imparted greater uncertainty to the outlook and needs to be closely watched, especially as localised and regional lockdowns could dampen the recent improvement in demand conditions and delay the return of normalcy.
Das said that the increase in international commodity prices since the February monetary policy and recurrence of global financial market volatility like the bout experienced in late February accentuates the downside risks.
He noted that global growth is gradually recovering from the slowdown, but it remains uneven across countries and is supported by ongoing vaccination drives, sustained accommodative monetary policies and further sizable fiscal stimulus.
The upside risks, however, come from the vaccination programme being speeded up and increasingly extended to the wider segments of the population; the gradual release of pent-up demand; and the investment-enhancing and growth-supportive reform measures taken by the government, he said.
"In India, we are now better prepared to meet the challenges posed by this resurgence in infections. Fiscal and monetary authorities stand ready to act in a coordinated manner to limit its spillovers to the economy at large and contain its fallout on the ongoing recovery," he said.
He further noted that "in the domestic economy, the focus must now be on containing the spread of the virus as well as on economic revival - consolidating the gains achieved so far and sustaining the impulses of growth in the new financial year (2021-22)".
Das stressed that the focus of the Union Budget 2021-22, on investment-led measures with increased allocations for capital expenditure, the expanded production-linked incentives (PLI) scheme, and rising capacity utilisation will reinforce the process of economic revival.
"Juxtaposition of high frequency lead and coincident indicators reveals that economic activity is normalising in spite of the surge in infections," he said, and added rural demand remains buoyant and record agriculture production in 2020-21 bodes well for its resilience.
Urban demand has gained traction and should get a fillip with the ongoing vaccination drive.
The National Statistical Office (NSO) in its update on February 26, 2021 placed the contraction in real GDP at 8.0 per cent for 2020-21.
The IMF on Tuesday projected an impressive 12.5 per cent growth rate for India in 2021, stronger than that of China, the only major economy to have a positive growth rate last year during the COVID-19 pandemic.
The Washington-based global financial institution, in its annual World Economic Outlook ahead of the annual Spring meeting with the World Bank, said the Indian economy is expected to grow by 6.9 per cent in 2022."
Economic measures taken by countries during pandemic may have unintended consequences: IMF
The actions taken by countries during the coronavirus pandemic to prevent a deeper economic downturn may have unintended consequences, according to a top IMF official.
The global economy is beginning to emerge from the economic shock caused by the COVID 19 pandemic, Tobias Adrian, Director of the IMF's Monetary and Capital Markets Department, told reporters at a news conference here on Tuesday.
“The economy has benefited from extraordinary policy measures that have eased financial conditions, preventing a deeper economic downturn. But those actions may have unintended consequences,” Adrian said.
Valuations for risk assets have become stretched, financial vulnerabilities have intensified and continuing policy support remains necessary, but a range of policy measures are needed to address vulnerabilities and to protect economic recovery, he said.
RBI targets 5.2% retail inflation for first half of FY22
RBI looks to target the upper bound of its inflation target range.
PTI reports: "Reserve Bank on Wednesday said it expects retail inflation at 5.2 per cent in the first half of the current fiscal and revised downwards the target to 5 per cent for the quarter ended March.
While headline inflation at 5 per cent in Feb 2021 remains within the tolerance band, some underline constituents are testing the upper tolerance level. Going forward, the food inflation trajectory will critically depend on the temporal and special progress of southwest monsoon in the 2021 season, RBI Governor Shaktikanta Das said on Wednesday while announcing the first monetary policy for the current fiscal.
Reserve Bank of India (RBI) has kept the key repo rate unchanged at 4 per cent to support growth in the current situation.
Das said there has been some respite from the incidence of domestic taxes on petroleum products through coordinated actions by the Centre and states could provide relief on top of the recent easing of the international crude prices.
However, the combination of international commodity prices and logistics cost may push up input price pressures across manufacturing and services, he added.
"Taking into consideration all these factors, the projection for CPI inflation has been revised to 5 per cent in Q4 of FY2021; 5.2 per cent in Q1 FY2021-22; 5.2 per cent also in Q2 of FY22; 4.4 pc in Q3 and 5.1 per cent in Q4 with risks broadly balanced," Das said.
Earlier, the central bank had projected retail inflation at 5.2 per cent for the 2021 March quarter.
RBI has the mandate to keep inflation at 4 per cent with a bias of plus or minus 2 per cent."
Shriram Automall generates business worth ₹3,000 crore
Pre-owned vehicle exchange platform Shriram Automall India Ltd. (SAMIL) generated business worth more than ₹3,000 crore and transacted more than 1.60 lakh pre-owned vehicles and equipment during FY21.
SAMIL is a part of Shriram Transport Finance Co. Ltd. and MXC Solutions India Pvt. Ltd.
“We have been seeing very strong recovery trends in the demand for used vehicles and equipment with price realisation getting better, especially towards the end of Q4,” said Sameer Malhotra, director and CEO.
“Over 130 crore [worth of] transactions were done in a single-day event. Even March has been phenomenal and we did over ₹500 crore of transactions, which was overwhelming,” he added.
RBI keeps interests rates unchanged
The central bank doesn't surprise.
PTI reports: "Reserve Bank of India on Wednesday expectedly left interest rates unchanged and maintained an accommodative stance as the economy faces a renewed threat to growth due to the resurgence of coronavirus cases.
The central bank kept the benchmark repurchase rate unchanged at 4 per cent and maintained accommodative policy stance to support growth.
RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) kept its estimate for economic growth unchanged at 10.5 per cent for the current fiscal.
MPC saw inflation edging up to 5.2 per cent in the first half of the new fiscal from 5 per cent in the January-March period and moderate to 4.4 per cent in Q3 of FY22."
India's restaurant chain Barbeque-Nation falls in debut trade
Another IPO launch fails to take off.
Reuters reports: "Shares of Barbeque-Nation Hospitality fell 2% in their market debut on Wednesday, after the casual dining restaurant chain raised about 4.53 billion rupees ($61.62 million) through an initial public offering (IPO).
Fundraising via IPOs is at a 13-year high in India due to a flood of overseas investment and as unusual interest from mom-and-pop investors spur more listings, making India one of the hottest IPO markets in 2021.
Barbeque-Nation's shares opened at 489.85 rupees per share, below the offer price of 500 rupees."
Indian shares inch up ahead of central bank rate decision
A good start to the day for stocks ahead of RBI's rates decision.
Reuters reports: "Indian shares inched higher on Wednesday, ahead of a central bank decision that could leave interest rates at record lows, as a second surge in domestic coronavirus cases sparked fears about the impact on economic growth.
The Reserve Bank of India (RBI), which has slashed its main repo rate by 115 basis points since March 2020 to cushion the impact of the COVID-19 pandemic, was expected to keep its benchmark lending rate at 4%.
Economists had expected the RBI to start normalising policy or unwind the large scale rupee liquidity in the banking system in the June quarter or latest by September quarter. That is now expected to be delayed, according to analysts.
"The Monetary Policy Committee is likely to maintain that growth needs consistent firm traction and continued policy support is crucial for a durable growth revival," Emkay Global Financial Services said in a preview note.
The NSE Nifty 50 index rose 0.2% to 14,709 and the S&P BSE Sensex was up 0.1% at 49,256.10 by 0347 GMT.
Investors will be keeping an eye on the central bank's liquidity stance to support the economy in relation to rising COVID-19 cases and inflation forecasts amid a rise in global commodity prices, especially crude oil.
Earlier this week, India breached the grim milestone of 100,000 daily coronavirus infections for the first time.
Restaurant chain operator Barbeque-Nation Hospitality Ltd's shares will make their debut in the Mumbai market on Wednesday.
The International Monetary Fund said on Tuesday unprecedented public spending to fight the pandemic would push global growth to 6% this year, while projecting India's growth rate at 12.5% for 2021."
Expected growth of 12.5% for India but “very severe downside risks” due to COVID wave: IMF
After an estimated contraction of 8% in the fiscal year that ended March 31, India is projected to grow at 12.5 % during the current year, settling down to 6.9% growth year (FY22/23), according to the World Economic Outlook (WEO): Managing Divergent Recoveries, released by the IMF as the World Bank IMF Spring Meetings kick off virtually. The growth outlook for India however comes with significant downside risks because of the current pandemic wave the country is experiencing, IMF economists said.
The projections for India were based on evidence to support the normalization of economic activity but these forecasts preceded the current wave of COVID-19 in India, “ which is quite concerning,” IMF Chief Economist Gita Gopinath said at a press conference on Tuesday.
The current growth projections already take “ a fairly conservative view” IMF economist Malhar Nabar said.
