Liquidity crunch key factor for slowdown, is it a bittersweet win for JSW to buy Bhushan Power; all this and more on Moneycontrol Pro
Others say that the credit slowdown is the result of lower demand in the economy and not its cause.
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In any case, the govt is trying to address this tightening by lowering interest rates and by recapitalising banks
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Tight financial conditions are a big reason for the slowdown
Businesses have been complaining that lack of credit has been one big reason for the slowdown in the economy. Others say that the credit slowdown is the result of lower demand in the economy and not its cause. Which view is the correct one? Or is this like asking ‘which came first, the chicken or the egg’? Is there an element of truth in both perspectives? In any case, the government is trying to address this tightening by lowering interest rates and by recapitalising banks, so that they can start lending again. The smaller firms have been the worst affected as a result of the NBFC crisis and the government knows this, which is why it is pushing banks to lend to MSMEs (micro, small and medium enterprises). Click here to read more.
JSW Steel to acquire Bhushan Power but the celebrations seem muted
Last week, JSW Steel’s hard-fought bid to acquire Bhushan Power & Steel was declared successful. The company had raised its initially reported bid of Rs 9,500 crore to Rs 19,700 crore, to inch ahead of Tata Steel’s Rs 17,000-crore offer. While the NCLT approved JSW Steel’s resolution plan the celebrations seem muted. Its announcement and news reports give a clue why. There is some uncertainty related to Bhushan’s quantum of liability and litigations. JSW Steel said that it is examining the terms and conditions of the order to determine the next course of action. Is it a bittersweet victory for JSW? Click here to read more.
This former multi-bagger has what it takes to be a winner again
This high-precision polymer processing player, caters to some of the world's leading OEMs (original equipment manufacturers). It derives 65-70 percent of its revenue from exports. It has entered into a range of agreements with global home furnishing, department story players and even pharmaceutical companies for making devices such as insulin pens. With a healthy order book and reasonable valuations, this stock could be a long-term pick, feels our research team. Click here to read more.
Engineers India: What should investors do?
Engineers India has a growing order book that provides good earnings visibility. Its strong order pipeline led by an increase in hydrocarbon capex while its overseas diversification will help in higher growth. The firm’s cash generation cycle is set to improve and lead to higher free cash flows. But this has to be weighed against the key risks of an investment slowdown, especially in the domestic hydrocarbon industry, and execution risks. Click here to read our analyst’s take.
The one chart that shows where the markets could be headed
There are many ways of judging the strength of the overall market. One such way is plotting the number of stocks that are advancing against those declining. Such an indicator is called the Advance-Decline Line or the AD Line. This indicator is based on Net advances, which is derived from subtracting the number of declining stocks from the number of advancing stocks. What does this indicator show? Click here to read more.
Picks from our technical analysts
1. ICICI General Insurance: These shares has moved in line with other insurance stocks. Technically, ICICI Gen Insurance is showing a breakout which can result in the further upside. Click here to know how to trade this stock.
2. REC: Shares of REC Ltd are showing positive strength. They closed positive with high open interest and volume. Click here to know how to trade REC options profitably.
The NCLAT last month had vacated its stay and asked the CoC to consider resolution plans submitted by three firms -- Tata Steel, Liberty House and JSW Steel.
UK-based Liberty House on Monday approached the National Company Law Appellate Tribunal (NCLAT) against the committee of creditors and resolution professional of Bhushan Power & Steel seeking information on the bid finalisation process of the firm
NCLAT extends deadline for submission of revised bids for Bhushan Power & Steel on plea of Tata Steel
Bhushan Power and Steel was among the 12 non-performing accounts referred by RBI for NCLT proceedings.