Business News at 05:30 pm on 8th August, 2024

Let’s begin. The Reserve Bank of India has decided to maintain the repo rate at 6.5% for the ninth consecutive meeting, citing persistent food inflation as a key concern. In the third bi-monthly monetary policy review for the current financial year, RBI Governor Shaktikanta Das said, quote, “The Monetary Policy Committee met on 6th, 7th and 8th August 2024. After a detailed assessment of the evolving macroeconomic and financial conditions and the outlook, it decided by a 4 to 2 majority to keep the policy repo rate unchanged at 6.50 per cent. Consequently, the standing deposit facility rate remains at 6.25 per cent and the marginal standing facility rate and the Bank Rate at 6.75 per cent,” unquote.
Moving on, Das also said that inflation will moderate from July onwards as the monsoon has improved and global food prices have shown signs of easing in July. He said that global food prices showed signs of easing in the month of July after registering an increase since March 2024. A degree of relief in food inflation is expected from the pickup in southwest monsoon and healthy progress in Kharif sowing. Das added, quote, “Assuming a normal monsoon and taking into account the 4.9 per cent inflation print, Q1 CPI inflation for the current financial year (2024-25) is projected at 4.5 per cent, with q2 at 4.4 per cent, Q3 at 4.7 per cent and Q4 at 4.3 per cent,” unquote.
Further, Das also expressed concern over high growth of ‘top-up’ housing loans, saying that regulatory prescriptions relating to loan to value ratio, risk weights and monitoring of end use of funds are not being strictly adhered to by “certain entities” in this regard. Later, briefing media after the announcement of bi-monthly monetary policy review, Das said, regulatory requirements in top-up housing loans are not being followed by certain entities and it is not a system-level problem. Anil Gupta, Senior Vice President and Co-Group Head – Financial Sector Ratings, ICRA Ltd, said that such loans not only raises concerns on overleveraging but, it also raises suspicion on the quality of such borrowers
Over to markets. Markets regulator Sebi has amended alternative investment funds norms specifying maximum permissible limit for extension of tenure by ‘Large Value Funds’. In a notification, Sebi said a large value fund for accredited investors may be permitted to extend its tenure up to five years. This is subject to the approval of two-thirds of the unit holders by value of their investment in the large value fund for accredited investors. The extension in tenure of any existing scheme of a large value fund for accredited investors will be subject to such conditions as specified by the regulator. The move is aimed at providing clarity to investors in Large Value Funds for Accredited Investors about their investment horizon.
In some more market news, Airtel Payments Bank on Thursday said its net profit for the June quarter rose 41 per cent year-on-year to Rs 7.2 crore, amid uptick in digital savings bank accounts alongside other digital offerings. Announcing its consolidated report card for the first quarter ended on June 30, 2024, Airtel Payments Bank said it has hit a significant milestone and that, in a first, the bank’s quarterly revenue grew to Rs 610 crore, up by 52 per cent on-year. The net profits stood at Rs 7.2 crore, up by 41 per cent year on year.
A US court has rejected GLAS Trust Company’s application for a temporary restraining order aimed at blocking the BCCI settlement, edtech firm Byju’s said on Thursday. Early this month, insolvency appellate tribunal NCLAT had approved a Rs 158.9 crore dues settlement with BCCI and set aside insolvency proceedings against Byju’s. Think and Learn, which owns Byju’s brand, said it welcomes the decision of the Delaware Bankruptcy Court to reject attempts by GLAS (purporting to represent the foreign lender consortium) to impede the company’s ongoing turnaround efforts. GLAS had also opposed the settlement with the BCCI before the NCLAT alleging the money paid by Riju Raveendran as tainted and a case of “round-tripping”.
Lastly, let’s see how the share market performed today. Indian benchmark indices ended lower in the highly volatile session on August 8 with Nifty below 24,100. At close, the Sensex was down 581.79 points or 0.73 per cent at 78,886.22, and the Nifty was down 180.50 points or 0.74 per cent at 24,117. About 1702 shares advanced, 1679 shares declined, and 84 shares unchanged. LTIMindtree, Grasim Industries, Asian Paints, Power Grid Corp and Infosys were among major losers on the Nifty, while gainers included HDFC Life, Tata Motors, SBI Life Insurance, HDFC Bank and Cipla. On the sectoral front, except pharma, healthcare and media, all other indices ended in the red with metal, realty, oil & gas, information technology down 1-2 percent.