Petro Goods Price Hike (28 April 1997)
This much talked about & partially discounted news could push the market down
by atleast 3%.
Interest Rates Cut (29 April 1997)
There is good news for the industry as Financial Institutions IDBI & IFCI
have announced a cut in their PLR from 16.5% to 15%. The highest interest at which these FIs would lend is 18.5%.
There is likely to be an increased competition between banks & FIs in
both project lending & working capital financing. The reduction in interest rates coupled with
the just announced credit policy would translate into timely availability
of relatively cheaper funds for corporates. And this is likely to
have a long term positive impact on the stock market.
More on Interest Rate Cuts (30 April 1997)
ICICI, a leading FI, for the first time in India, has announced
a medium term PLR (for a period between 12 months & 30 months) of 13.5% with a
cap of 17% which is lower than that offered by most banks. The long
term PLR has been cut from 16.5% to 15% with a cap of 18.5%. This is likely to intensify
competition between banks & FIs. We feel that the benificiary is the Indian
corporate sector. The slashing of interest rates is also likely to witness a diversion of funds from the debt market to the stock market.
Disclaimer
Sivan is in no way responsible for investment decisions based on the
information given in this web page.
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