MOODY'S LOWERS INDUSLND BANK'S OUTLOOK TO NEGATIVE FROM STABLE

 Moody’s Investors Services on Tuesday revised the outlook on IndusInd Bank's ratings to ‘negative’ from ‘stable’, while affirming the private lender’s ratings, to account for the risk of further asset quality deterioration.

The ratings agency noted that over the last few quarters, the bank has seen a deterioration in its asset quality, particularly in the corporate segment. Tight refinancing conditions for borrowers were a key trigger for the crystallisation of nonperforming loans (NPLs), it said.

Moody’s said refinancing conditions remain tight, especially for weaker borrowers.

“In particular, the bank has a relatively higher exposure to real estate compared to other banks at around 8% of its loan book at 31 December 2019. While there have been no NPLs in this segment so far, this exposure to the property market remains a source of risk, given the broader stress in the real estate sector,”

The bank could also be negatively impacted by the ongoing stress in the telecommunications sector.Meanwhile, Moody’s affirmed IndusInd Bank's domestic and foreign currency issuer ratings of Baa3/P-3, driven by the bank's strong buffers, both capital and profitability, which result in strong ability to absorb asset quality stress.

It also affirmed the bank's domestic and foreign currency bank deposit ratings of Baa3/P-3, foreign currency senior unsecured rating of Baa3, foreign currency senior unsecured MTN program rating of (P)Baa3, and Baseline Credit Assessment (BCA) and adjusted BCA of ba1.

At the same time, Moody's has affirmed the bank's counterparty risk assessment (CR Assessment) of Baa3 (cr)/P-3(cr), and domestic and foreign currency counterparty risk rating (CRR) of Baa3/P-3.

Sebi shortlists IBM, Infosys, Wipro, others for data analytics project

Sebi has shortlisted as many as eight companies, including Infosys, wipro and IBM India, to implement a "data analytics project" through which the regulator wants to track possible market manipulations such as insider trading and front running.The move is part of Sebi's efforts to address and handle challenges arising out of technological advancements in the markets.In November, the regulator had invited expression of interest (EoI) from "reputed and reliable solution providers for implementation of data analytics project and building of data models at Sebi".The analytics/model development would include developing new models, implementing analytics project, establishing linkages between various entities in the market, automated extraction of details from documents filed with Sebi and prediction of market manipulations such as insider trading and front running. Accordingly, the Securities and Exchange Board of India (Sebi) invited bids from companies to provide such services. After evaluating the responses, the regulator in a latest notice said, it has shortlisted eight firms -- PWC Pvt Ltd, Capgemini Technology Services India, Decimal Point Analytics, Wipro, IBM India, NEC Technologies India, Hewlett Packard Enterprise India and Infosys for "further process." In November, Sebi Chairman Ajay Tyagi announced that the regulator plans to spend Rs 500 crore on information technology in the next five years as well as have a "data lake project". The project is aimed at augmenting analytical capability at Sebi with advanced analytical tools such as artificial intelligence and machine learning, deep learning, big data analytics, pattern recognition, processing of structured and unstructured data, text mining and natural language processing, among others. Besides, the regulator, in its annual report for 2018-19, had said it intends to deploy data analytics and new generation technologies to deal with various challenges in the market. As per the report, the regulator would continue to strengthen market supervision through steps such as technology solutions being built to achieve the objective of identifying non-compliance and assisting in investigation.

AI TO THE RESCUE

AI TO THE RESCUE

THE HIGHLY CONNECTED 21^ST CENTURY CAN ENABLE DISEASES TO SPREAD WITH RAPIDITY. AI COULD BE ONE OF THE WAYS TO MITIGATE THIS DANGER

The Corona virus is more virulent and dangerous. It has confirmed a death of over 630 people over a limited span of time. Almost 30000 infections are reported in at least 25 nations. Meeting the threat of this virus has been a test case for AI. AI is used to mine data to identify and isolate potential carriers and victims. AI is also used to try and generate new vaccines and to identify the new drugs that will combat the new virus.

Canadian AI company Blue dot has issued health warnings to its clients. Their clients include businesses and public health officials of several countries. Blue dot also issued an advisory stating that travelers should avoid Wuhan. The WHO has also issued a similar notice on January 9,2020. America’s CDC has issued its first public warning on January 6. The Blue dot has used an global airline ticketing data in order to predict that this virus will be exported to Bangkok, Seoul, Taipei and Tokyo.

In order to identify where the virus has been taking hold, The Harvard Medical School is running an International team, which machine learning to analyse social media posts, news reports, public health channels, and information  supplied b y doctors. Fin tech company, Hedge Chatter built a neutral network to generate a day by day forecast of the numbers infected, geographical spread, death toll etc. It predicted that up to 2.5 billion people of the whole population could be infected within the next 45 days and the aftermath may rise to over 52 million. This is just an prediction and this will happen only if there do not occur any consistent changes in the disease spreading.

Chinese authorities make use of AI to mine data. Apps have been created to enable citizens to check if they have been in a bus train or plain with a confirmed victim. These things all has enabled a great surveillance system for China.

Baidu which is an Chinese equivalent of Google has enabled a system that uses a combination of infrared and face recognition to identify the people with higher body temperature. It is been said that it can check over 200 people in a minute. It is really far faster than the standard thermal scanners at airports.

Maruti Suzuki and other Automobile manufacturers are likely to increase the prices of cars.

Maruti Suzuki India, the country's largest car manufacturer, will be increasing car prices from January 1, 2020. In the company's BSE filing, Maruti Suzuki has said that the increase in various input costs has adversely affected the cost of its vehicle. Therefore, the company has decided to pass on some impact of the additional cost to its customers through a price increase across various models. The price hike will happen across the company's model range and the amount will vary for different models, however, it's yet to decide on the quantum of the price hike.The company had attributed the price hike to the impact of rising commodity prices and foreign exchange rates. The cyclical price revision happens at the start of every year and has become a norm in the auto industry.As of now, Maruti Suzuki India's vehicle line-up starts from the entry-level Alto 800, which is priced between Rs. 2.88 lakh to Rs. 4.09 lakh, while the company flagship model, is priced at Rs. 9.79 lakh to Rs.11.46 lakh (all prices ex-showroom, Delhi). About 70 per cent of the company's line-up is already BS6 compliant, while the company is working on the remaining models. Maruti Suzuki has announced that it will phase out its smaller, 1.3-litre, diesel engine ahead of the BS6 deadline however the company might continue offering its new 1.5-litre diesel engine even after April 1, 2020.

Not only Maruti, most of the automobile manufacturers will be increasing their present price due to the transition. Moreover this issue has got serious impact on sales of automobiles.

Entry segment cars like Alto, WagonR, Kwid,Celerio,Hyundai Eon,Datsun Go ,Redi Go will have a hike of Rs 3000-5000.Mid Premium Hatchback cars like Tiago,Swift,i10,Figo will extent hike of Rs.5000-10000.Dzire and Baleno hot sellers will raise Rs.7000 to Rs.20000.Whereas Compact Suvs will witness a hike of Rs.10000 to Rs.20000.Executive, Premium SUVs and luxury cars will be raising their price as well.

Soft Bank in talks to pick up minority stake in Mahindra Electric Mobility

Mahindra Electric Mobility, one of the countries largest electric vehicle(EV) manufacturers is in preliminary talks with japanese giant soft bank for an alliance which could include taking minority stake in the company.

The company, in which Mahindra &Mahindra (M&M) is the key investor, publicly announced a few weeks ago that it would look for a private equity investor or a strategic investor to scale up its operations,though M&M will continue to stay a big investor. 

Mahindra electric mobility sold over 10,400 EVs on 2018-19

Nearly a dozen of the coming vehicles are in the affordable segment costing less than rs 10lakh.

This massive vehicle electrification drive is being led by Indian vehicle makers — Tata Motors and Mahindra & Mahindra — who will be launching half of these models with an eye on addressing the loc Mahindra’s has stepped up focus on electric three wheelers for last mile mobility. E-rickshaws are predominantly sold in North India and are one of the most effective means of last mile connectivity as well as being a cheaper mode of transportation. The battery-powered rickshaw has been replacing cyclic rickshaw with sales, growing at an average rate of 20% annually since 2015. However most of these sales have come from the Unorganised sector and what is giving a fillip to the Unorganised sector.

 

LIC's bad debt jumped nearly five times 8 years through Financial Year 2019 to 6.15%

The government’s plan to list LIC next fiscal may help unlock the life insurance behemoth’s true potential and ensure greater accountability, but at the moment it’s bleeding from a string of bad investments.

Even as the government has made its intentions clear that it wants to list Life Insurance Corporation of India on the stock exchanges, there are developments related to state-owned insurance giant that will come into reckoning.

Gross bad loans of LIC jumped almost five times in eight years through FY19 to as high as 6.15%.

On top of the pile is the NPA the company has been carrying following investments in many companies going bad. These include DHFL, Reliance Capital and Reliance Home Finance. These have become basket cases and are struggling at the National Company Law Tribunal for insolvency resolution. LIC had a collective exposure of around Rs 11,000 crore in these companies by way of bonds, which have now turned out to be of junk value. Analysts say its non-performing assets (NPAs) may inch up further in FY20, as bonds of companies — including FDHL , Reliance Capital and Reliance Home Finance in which it had an exposure around Rs. 11000 crores. The government’s decision to ask LIC to take over the stressed IDBI Bank has also cost the insurance company dearly since there has not been any qualitative improvement in the financial status of IDBI Bank so far.

For the record, LIC had already accounted for as much as Rs 23,761 crore in the last completed financial year ending March 2019. That has brought down to NPA to 0.27% something that will work favourably now, when it goes for the IPO. LIC would want to further clean up its balance sheet before going in for the listing and IPO.

Samsung plans big comeback with premium smartphones in India

Eight years ago, Samsung became the pioneer in the Indian mobile phone industry with the "Galaxy S3" rolled out of its Noida facility. Today, with the Indian smartphone market witnessing modest growth of 8% (year-on-year) in 2019, the South Korean giant reported rising shipments among the top five brands.

The last 8 years or so have seen Chinese invasion like never before, launching devices with top notch features while taking the average selling point (ASP) further down. The Chinese smartphone brands captured 72 per cent of the Indian market in 2019 compared to the 60 per cent in 2018.

From the very beginning, a premium player, Samsung faced the heat as smartphones became more affordable with each passing year, and players like Xiaomi and vivo captured the affordable mid-premium segments, forcing the company to launch online  exclusive  ' M ' series in the budget segment and revamping the mid-segment ' A ' series, which has so far been a success.

The company understands that it is best known for the RS 30,000 and above segment, starting in 2020 with the launch of the 'Lite' device with its successful premium brands and taking positive steps in the 5g and folding space. With the launch of new flagship models and foldable smartphones, Samsung expects mobile sales to increase on improved product mix.

The business now appears to be back on its luxury path in India, with the introduction of 'Lite' version of S10 and note 10 Lite in the range where OnePlus currently rules.

Samsung aims to improve profits by increasing luxury smartphone sales and improving their mid to low end portfolio profitability.

Tweaking its portfolio would be godsend for Samsung to revive its growth path. In India, Samsung needs to go aggressive in the RS 15000 - RS 35000 segment.