CV sales may contract 8-10% in FY21: Icra
Despite negative global cues and a rise in coronavirus cases in India to over 5,000, stock market indices Sensex and Nifty50 soared higher in opening trade. The Sensex rose above 31,000 and the Nifty above 9,000 levels but later traders booked profit, leading to sharp fall from the day's highs.
In the absence of authentic data about coronavirus impact on the economy, traders’ call on the short-term market direction is leading to irregular trading in a highly volatile market, causing huge up and down moves in the indices as well as stocks.
Market sources said, such volatile market movement could cause huge losses to retail investors, who could get caught easily by shortterm market directions.
After 2500 points upmove on Tuesday, the Sensex on Wednesday fell over 1300 points from the intra-day high of 31,227.97 to close in the red. The
Sensex finally closed at
29,893.96, down 173 points or 0.58 per cent.
Similar volatile movement in NSE’s Nifty-50 took the index above the
9,000-mark to the day’s high of 9,131.70 but it proved a temporary spike as the index finally closed at 8748.75, down by 43.45 points, or 0.49 per cent.
Provisional stock exchange data showed foreign portfolio investors were net buyers of equities worth Rs 1,943.41 crore while the domestic institutions were net sellers by Rs 1,757.79 crore.
However, there was no correlation to FPIs net buying on the rupee, which fell sharply.
Paras Bothra, president of equity research, Ashika Stock Broking, said, “Volatility in the markets is on account of speculation that the central government is mulling over lockdown extension beyond April 14 amid the spread of coronavirus. Barring pharma, FMCG and select auto stocks, other sectoral indices remained under pressure.”
Ratings agency Icra on Wednesday said commercial vehicles (CV) sales volumes, a barometer of economic activity, in India are likely to contract further by 8-10 per cent in FY202021 as the near-term outlook of the sector is weighed down significantly by the coronavirus pandemic.
It maintained a negative outlook for the CV segment over the near-term due to slowing economic growth, current overcapacity in the CV ecosystem and not-so- benign financing environment, with challenges further aggravated by the rapid spread of novel coronavirus in the country.
“The demand headwinds are expected to continue over the near-term given the macroeconomic challenges in view of the recent pandemic outbreak coupled with weakening financial profile of fleet operators and significant price hikes because of transition to the BS-VI emission norms,” Icra said.
This, it said, would exert pressure on earnings and overall credit profile of CV OEMs, which have witnessed sharp earnings contraction over the past 34 quarters.
It said the outlook for the next fiscal, especially the first half, remains weak.
New Delhi, April 8: The Centre has asked states to allow bulk buyers, processors and big retailers to directly buy agri-produce from farmers, farmer producer organisations (FPOs) and cooperatives, for the next three months. The move is aimed at decongesting mandis and ensuring supplies to consumption regions.
The state governments have also been asked to notify warehouses registered by Warehousing Development and Regulatory Authority (WDRA) as deemed markets to facilitate online trading via the electronic National Agriculture Market (eNAM), Union agriculture secretary Sanjay Agarwal said in a communication to chief secretaries of all states and Union territories.
States have been asked to adopt these two emergent measures for at least three months, he added.
"As harvest season has started, there is immediate need to facilitate the process of direct marketing of all kinds by farmers, FPOs and cooperatives," Agarwal said.
To facilitate direct marketing, the states have been asked to allow direct buying facility by bulk buyers, processors and big retailers, outside mandi premises with minimum or without any requirement of a licensing or registration process.
To facilitate online trading via eNAM, the states have been asked to enable online trading of stored produce from the registered warehouses. For which, states have to notify such warehouses as deemed markets and also help FPOs to upload their produce for collection centres for bidding.