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Strategies & Market Trends : India Coffee House -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (9715)	11/21/1999 11:37:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 12475

Duff & Phelps gives bull rating to Indian economy DUFF & Phelps Credit Rating India has drawn up a bullish picture for the Indian economy with industrial production growing by 6.4 per cent in the first half of the current fiscal. In a release, Duff & Phelps said that while sales of the corporate sector for the period increased by 18 per cent, profits grew at a much slower 8 per cent. Railway freight traffic has grown by 7.60 per cent while cargo traffic at major ports grew by 8.20 per cent. Power generation, meanwhile, grew by 7.1 per cent during the period. Cumulative exports recorded a smart turnaround growing by 7.6 per cent in the first half of the current fiscal as compared to a decline of 3.5 per cent in the corresponding period of the previous year. According to the agency, the government has displayed its willingness to take necessary economic decisions if the good of the economy so dictated. Sales of commercial vehicles in the first half grew by 29 per cent, while those of passenger cars grew by 46.5 per cent. Motorcycle sales grew a bit slower at 23 per cent. The agency however cautions that for a sustained industrial recovery, the economy needs a sharp rise in investments and currently there are no signs of this pick-up. Commodities like fertilizers, vegetable oils, iron & steel and cement recorded increased traffic, while food grain movement dropped by 31 per cent. For the same period, coal despatches grew by 3 per cent in spite of a 1.3 per cent decline in production. According to the agency, the stable international price of coal led to larger imports. The agency has also expresses surprise at the downward trend witnessed by the BSE Sensex despite no negative change happening in economic fundamentals. High volatility could lead to retail investors deserting the equity markets, the agency states. In the first half, while net profits of MNCs grew by 54 per cent, financial service companies have witnessed a slow down. NBFCs witnessed a 9 per cent decline in profits even though operating income grew by 14 per cent. Net cumulative FII inflows upto October 1999 stood at $646 m as compared to $637 m in the corresponding period of 1998. DCR India also forecasts that the lag of two weeks in maintenance of the stipulated CRR by banks is expected to put a check on call money rates, which had firmed up in first half of 1999-2000. The rating agency has recommend that India demand that IPRs be granted on products based on traditional knowledge only after prior consent of under-developed countries and push for zero tax on e-commerce at the Seattle round of WTO. Source : MI Nov 22, 1999