สรุปข่าวเศรษฐกิจอินเดียประจำวันที่ 28 พฤศจิกายน 2556

Jewellery firms unlikely to report earnings recovery in third quarter

Continued difficulties in importing gold, higher premiums and increased working capital requirements may continue to weigh on the earnings of the listed jewellery makers. After a dismal show in the second quarter of 2013-14, a substantial recovery in earnings is unlikely even in the third quarter, which generally gets a boost from festive and wedding season purchases. Most listed jewellery firms, including Titan Industries, reported a sharp decline in y-o-y earnings in the three months to September 2013. Strong sales in the first quarter and weaker demand environment weighed on the topline that contracted by 5% to 35% for most companies compared to last year. Even self-imposed bans on coin sales by most jewellers to support the government’s efforts to restrict gold imports also impacted the volume numbers. Analysts say the volume recovery may not take place in the near future given the muted buying activity around Diwali, which generally sees strong purchases. Amid strict import regulations, rising premiums to international prices are also considered as a deterrent as jewellers have to pass on this cost to end consumers. Experts also feel that higher working capital requirement after the discontinuation of gold on lease model may impact earnings of jewellery firms, especially the smaller players.

(Source: Financial Express)

Gold jewellery exports likely to dip by 50% in FY14: Industry

Gold jewellery exports may decline by about 50 per cent in this financial year from last year after government restrictions reduced the availability of raw material, Gitanjali Gems Chairman and Managing Director Mehul Choksi said today. He mentioned that there are less stocks available in the market and the premium is as high as 8-10 per cent in the domestic market. This will give rise to smuggling, very little gold is available for exports He said if raw material availability remains low, it will give rise to smuggling. During the festive season, industry's sales fell about 50 per cent from the previous year period. The sector currently employs about 2.5 million people. Choksi said Indian demand for gold jewellery is shifting to the Middle East due to competitive prices. Gitanjali Export Corporation CEO Sanjeev Agarwal said local gold prices are high, even as prices overseas drop. In Dubai, gold is 21 per cent cheaper than in India, making the city an attractive destination to buy the metal, he added. "There are reports that about half tonne of gold is coming into India from Dubai. The Middle Eastern region, along with China and Thailand, are also emerging as alternative manufacturing bases. Many big players have already shifted their bases to these to these locations to feed the export market," he said. .

(Source: Economic Times)

Govt may revisit FDI norms for housing, pharma today

The Cabinet is likely to take a decision on Thursday on relaxing FDI norms for the housing sector and reducing foreign investment limit to 49% in rare and critical areas of the pharma segment. The Cabinet would also deliberate on the stand to be taken by India in the forthcoming WTO meet in Bali during December 3-6. India is demanding an amendment to the agreement in agriculture of WTO in order to implement its food security law. The US and EU are opposing any such amendment. The Department of Industrial Policy and Promotion (DIPP) has also proposed incorporating conditions for foreign firms like mandatory investment in R&D and non-compete clause in the shareholders pact.

(Source: Financial Express)

Foreign investors queue up for road & clean energy assets

India’s infrastructure sector may be burdened by high debt and slowing growth, but this isn’t dampening its attraction for foreign investors. This is because not only are valuations attractive, new opportunities have also arisen in sectors such as renewable energy. Foreign investors, especially long-only funds and large renewable players, are either snapping up assets in this segment or setting up projects in India. In the renewable energy space, large foreign investors, be it sovereign funds, pension funds or large companies, are looking at acquiring operating assets that are relatively stress-free, or setting up new projects. Investment bankers say deals to the tune of $2 billion are in the works and will be announced soon.

(Source: Business Standard)

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