If there is robust GDP growth, it does translate into good growth in earnings per share of corporates. That's the pitch institutional investors are making to induce clients into a not-so-cheap Indian market. Raj Sharma of Merrill Lynch says the GDP-EPS linkage typically works on a factor of three; if you get 5% GDP growth, you are likely to get 15% EPS growth. By that arithmetic, if a reasonable growth rate is assured, then the Indian market would begin to look quite appealing from a three- to five-year view.
STREET PULSE: Where we stand Nifty futures on the Singapore Exchange traded 6 points, or 0.05 per cent, lower at 7am (IST), signalling a flat start ahead for Dalal Street. Asian shares stepped back from three-week highs on Monday as investors weighed the near-term hit on global growth from a fast-spreading coronavirus outbreak in China, although expectations of further policy stimulus helped stem losses.
HERE'S WHAT TO WATCH  | MSCI's broadest index of Asia-Pacific shares outside Japan dipped 0.1% while Australian shares and South Korea's KOSPI slipped 0.3% each. Japan's Nikkei fell more than 1% after data showed the country's economy contracted during October-December. |
| Wall Street edged lower on Friday as uncertainties surrounding the coronavirus epidemic and downbeat economic data put a damper on investor sentiment. Dow fell 126 points to 29,297, the S&P500 lost 5.97 points to 3,367 and the Nasdaq 14 points to 9,697. |
| Crude oil prices edged lower on Monday as investors brace for economic data in Asia due this week. Brent futures fell 33 cents to $56.99 a barrel, while WTI crude fell 13 cents to $51.92 |
| The rupee on Friday fell by 6 paise to close at 71.37 against the US dollar tracking heavy selling in domestic equities and strengthening of the American currency in the overseas market |
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AGR ROW BREWING… Bharti Airtel and Vodafone Idea have assessed their adjusted gross revenue (AGR) dues at about half the amount that the DoT has demanded, likely setting the stage for another dispute between the companies and the government. Initial calculations at Bharti Airtel pegged the dues at Rs 15,000-18,000 crore, instead of more than Rs 35,500 crore estimated by DoT. Vodafone Idea's initial computation puts it at Rs 18,000-23,000 crore against DoT's Rs 53,000 crore estimate. Cash-strapped Vodafone Idea is likely to pay a part of the amount in next few days.
Read More NRI INCOME UNDER LENS… The drive to tax 'stateless persons' could fast become a cat-and-mouse game between the government and many NRIs. As the implications of the proposed law sink in, there is a creeping fear that from next year the income-tax department will question NRIs on 'unrealistic' overseas earnings. Since the passage of the Black Money Act in 2015, several Indians became NRIs to generate fake overseas income such as trading profits, consultancy fee and fat salaries to legitimise undisclosed funds stashed abroad. Such people will be in a spot as they may have to justify their income.
Read More DHFL'S FUND CONDUIT… DHFL promoters Kapil and Dheeraj Wadhawan had used businessman Sudhakar Shetty as a conduit to siphon off at least Rs 3,000 crore of the Rs 12,000 crore they had allegedly moved out of the mortgage lender, people privy to the probe into the matter said. The brothers, who are being probed separately by the Serious Fraud Investigation Office and the Enforcement Directorate (ED), had used several conduits to float a maze of shell companies through which the money was channelled out, they said.
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DAMANI'S DREAM RUN… Radhakishan Damani, founder of Avenue Supermarts, has become India's second richest person with a networth of $17.8 billion, next to Mukesh Ambani, according to Forbes' Real-Time Billionaires Index. After a rally of over 5% of Avenue Supermarts shares last week, Damani pipped HCL's Shiv Nadar ($16.5 billion), Uday Kotak ($14.9 billion) and Gautam Adani ($14.1 billion).
Read More RATERS COOL ON TELCOS… Ratings companies are unlikely to construe missing government payments by telecom companies as default for now, unless DoT invokes the bank guarantees furnished by them. Payment of licence fee is a "commercial obligation," rather than a "financial obligation" where a default would have warranted rating cuts, they said. This could provide at least temporary relief for investors of Vodafone Idea, Bharti Airtel and Tata Teleservices. Local ratings companies CARE, Crisil, ICRA and India Ratings are meeting this week to review the creditworthiness of telcos.
Read More Meanwhile... Realty Revival Begins… Indian homebuyers are slowly getting enthusiastic about buying property again. After a lull for much of last year caused by the economic slowdown and uncertainty over incomes and jobs, buyers returned to the property market again in October-December of 2019 driving up home sales, a survey by Liases Foras Real Estate Ratings & Research showed. The top 35 cities recorded a 5% quarter-on-quarter increase in home sales in the third quarter of FY20 and a 3% year-on-year rise, the firm's latest data shows.
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