Focus on India – Stocks fall; Headline inflation could drop below 6% by March; Toyota relaunches India strategy


RIYADH: Indian stocks fell on Monday, led by tech and banking stocks, as worries about global economic growth kept investors on edge.

The NSE Nifty 50 index fell 0.76% to 17,622.75 by 0400 GMT, while the S&P BSE Sensex fell 0.67% to 59,245.18.

India’s Nifty IT index fell 1.1% while the Nifty Bank index fell 1.4%.

Kotak Mahindra Bank was the biggest percentage loser in the NSE index with a drop of 2.7%.

India’s headline inflation could dip below 6% by March: analysts

Headline retail inflation in India could dip below 6% by the fourth quarter of this fiscal year, ending the current cycle of rate hikes, analysts said over the weekend.

Following Friday’s release of the central bank’s monetary policy committee minutes, analysts said the Reserve Bank of India could raise repo rates by 50 to 60 basis points by December.

“We expect the RBI to make two rate hikes of 25 basis points at the September and December meetings, taking the repo rate to 5.90%,” said Rahul Bajoria, chief economist for the India at Barclays.

Bringing retail price inflation closer to the RBI’s 4% target was essential to support medium-term economic growth, the committee said.

Some analysts have said that a sharp 50 basis point increase in the repo rate is also possible next month.

“The possibility of a 50 basis point hike in September cannot be ruled out if the US Fed makes another 75 basis point hike,” Gaura Sen Gupta, Indian economist at IDFC First Bank, said in a note.

Earlier this month, the RBI raised the bank’s key rate by 50 basis points to 5.40%, its third increase in four months to curb rising price pressures.

The RBI has raised the repo rate by 140 basis points since May.

Toyota doubles its hybrid bet in India

Toyota is relaunching its strategy for India, doubling down on the bet that emerging markets will learn to love its hybrids.

Renowned for its pioneering Prius, the Japanese automaker has struggled to sell many of its Camry hybrid sedan since its Indian debut in 2013, in part because of a list price of more than eight times the annual revenue of a car. middle class family.

This time, Toyota is determined to do things differently with lower-cost hybrids, said four company and industry executives and suppliers who provided never-before-seen details of the sourcing, production and marketing strategy. car manufacturer pricing.

At the heart of the strategy is a drive to reduce the cost of full hybrid powertrains by manufacturing them in India, where the automaker’s factories are operating well below capacity, and to source key materials from the country.

Toyota Motor is also leveraging its cooperation with partner Suzuki Motor, majority owner of India’s largest automaker Maruti, to benefit from its low-cost engineering know-how and mild-hybrid technology.

“The hybrid bet is a turning point. It will be a litmus test for Toyota’s future and success in India,” a person with direct knowledge of Toyota’s plans told Reuters.

A full hybrid can be driven for periods on electricity, while mild hybrid technology only supplements the combustion engine to help reduce emissions. However, mild hybrids have smaller batteries and cost much less.

(Contributed by Reuters)


Comments are closed.