EUR 120.00 For Business Accounts Only

MOSL: Morning India (01/April/19)-1. EcoScope (a. 3QFY19 CAD in line with expectations-b. India’s fiscal deficit amounts to 134.2% of RE by end-Feb’19; c. Can CRR cut be more effective than repo rate cut?); 2.

MOrning India (01/April/19): 1. EcoScope (a. 3QFY19 CAD in line with expectations; b. India’s fiscal deficit amounts to 134.2% of RE by end-Feb’19; c. Can CRR cut be more effective than repo rate cut?); 2. SRF (Dahej plant to shut down); 3. Apollo Tyres; 4. Financials

 

Today’s top research theme

EcoScope: 3QFY19 CAD in line with expectations; India's Forex reserves decline

• India's current account deficit (CAD) came in at USD16.9b (2.5% of GDP) in 3QFY19 as against USD13.7b (2.1% of GDP) in the year ago quarter. The number is way lower than the market consensus of USD19.9b and nearly equal to our estimate of USD16.8b. Higher gold and net oil imports pushed up CAD; excluding gold and oil, CAD amounted to USD5.7b (2% of GDP), double of what was imported in the previous quarter.
• Capital inflows deteriorated to USD13.6b in 3QFY19 (2% of GDP) from USD22.5b in Q3FY18 (3.4% of GDP). They are insufficient to finance the CAD, leading to a higher drawdown of USD 4.3b from its reserves in 3QFY19.
• We expect India's CAD to ~2.1% of GDP in FY19, up from 1.9% in FY18. As for our oil assumption, we expect it to be in the range of USD70 per barrel in FY20.

Piping hot news

Kumar Mangalam Birla to rejig promoter cos ahead of Vodafone Idea issue

Ahead of Vodafone Idea’s $3.6 billion rights issue, Kumar Mangalam Birla is reorganising unlisted group companies to raise funds, said people with knowledge of the matter. SKI Carbon Black Mauritius Ltd (Birla Carbon) is set to buy a controlling interest in Swiss Singapore Overseas Enterprises Pte Ltd for $450 million. Both are promoter companies of the Aditya Birla Group chairman.