Current Economic Statistics and Review For the
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Theme
of the week: All-India Debt and Investment Surveys – A Factual Review*
Part 11BCost of Debt and Distribution of Debt By Size of Debt
“The Rate of Interest and Terms of Payment of Interest largely explain the Interest Burden or cost of debt borne by the indebted households”. AIDIS Surveys IntroductionThe
Part II A of the note dealt with an analysis of the magnitude of household
debt in rural and urban areas and the role played by institutional and
non-institutional credit agencies in the credit scene of rural and urban This part of the note (Part II B) deals briefly with different facets of interest burden or cost of debt such as rate of interest, terms of interest, duration of debt and type of loan and security as well distribution of debt by size of debt. I Interest BurdenOverviewLoans on different terms of payment of interest are categorized by terms of interest charged on loans incurred by them. There are four such categories: i) interest free, ii) simple interest iii) compound interest and iv) concessional rate of interest. Obviously, to understand the burden of interest , the actual rate of interest should also be examined along with the terms of interest of loans, since the actual interest amount due from households would differ according to terms of interest payment.
Table
1 shows percentage shares of
aggregate amounts of debt as on 30-6-2002 by terms of interest along with
those obtained from 1991 and 1981 surveys of AIDIS. As per these data,
percentage share of aggregate
amount of debt at concessional rates was the least
- a tiny 2 per cent to 3 per cent in
Trend
in the last two decade
The percentage share of aggregate amount of debt with compound interest rates, which was much higher as on 30.6.1991 as compared to 30.6.1981, remained stable during the decade ending 30.6.2002 among both rural and urban households. At concession rates of interest, the share of debt, though increased from 1981 to 1991, has fallen back to the 1981 level in 2002 for both rural and urban households. The percentage share of aggregate debt, both in rural and urban households, at interest free category steadily decreased during the period 1981 to 2002. In the case of simple interest share of debt marginally declined from 69 per cent to 66 per cent between 1981 to 1991 and then increased to 69 per cent from 1991 to 2002. Category-wise
review
Interest free loans by definition get excluded from the ambit of this analysis and the meagre percentage share of cash debt under concessional loan rates is too meagre to be throwing any light. Hence, this review is confined to simple interest and compound interest loan only. The distribution of loans contracted at simple interest rates is uneven. Amount of loan contracted at a rate of 15 per cent or more constitutes 43 per cent amongst rural household as compared to amounts of debt contracted at less than 15 per cent (Table 2). Amongst urban households, it is exactly the opposite with more than 15 percent interest rates loans contributing 27 per cent and less than 15 per cent loan share being 42 per cent in 2002. The distribution of loans contracted at compound rates of interest reveals that the amounts contracted at less than 10 per cent interest rates are meagre and it is evenly distributed among the other two ranges of interest rates as depicted in Table 2. Differences
in Interest Rates Credit Agency-wise Table 3 depicts the percentage distribution of cash debt by range of interest rate and by credit agencies. It can be seen there from, that in rural areas institutional agencies extended 82 per cent of their advances at rates ranging from 12 to 20 per cent. Non-institutional agencies, on the other hand, advanced 73 per cent of their advances at higher ranges of 20 to 30 per cent and 30 per cent & above.
In urban areas, institutional agency loans had interest burden ranging from 10 to 20 per cent for 69 per cent of their loans. Non-institutional agencies in urban areas, however, charged interest rates ranging from 20 to 30 per cent and above for 51 per cent of their loans. Interestingly, in urban areas non-institutional agencies extended loans constituting 33 per cent of their total loans at nil interest rates. This may be due to the fact friends and relatives may be extending help more and more in urban areas as compared to rural areas. In rural areas, the corresponding share is 18 per cent.
Incidence of Interest BurdenAn analysis of incidence of interest burden among cultivator households reveals that the percentage of households who contracted debt with interest free and concessional rates were at 0.2 per cent and 0.7 per cent, respectively, in 2002. However, interest free loans accounted for much larger share amongst non-institutional agencies at 4.3 per cent which may be because they are from friends and relatives. There is not much difference in the case of non-cultivator households who approach institutional agencies. Rural households and urban households usually got their debt needs from credit agencies at simple interest rates (Table 4).
Table 5 depicts the distribution of cash debt as on 20-6-2002 at different interest rates contracted by rural and urban households as well as all households at different interest rate.
It can be seen therefrom, that more than 90 per cent of households credit dues are contracted carrying an interest burden of 10-20 per cent to institutional credit agencies. But, for the cash borrowed from non-institutional agencies they have to pay interest rates of 20 to 30 per cent for about 75 per cent of their debt.
II Duration of Cash DuesSteady Debt Duration Over past three decadesTable 6 portrays the percentage distribution of total amount of cash debt as on 30th June of 1971, 1981,1991 and 2002 by duration of debt, separately for rural and urban households. It can be seen therefrom that about 74 per cent of total dues are contracted for less than 3 years in 2002 in case of rural households only slightly less than that in 1971 and it has been about 14 per cent for the duration of 3 to 5 years. And hardly 4 per cent of loan is contracted for more than 10 years in rural areas in 2002 as against hardly 1 per cent in 1971.
In urban areas also more or less the same trend is witnessed, for the short duration debt. i.e. less than 3 years. However, there is a substantial fall from 21 per cent to 11 per cent in the case of loans for the period 5 to 10 years. Type
of Loan ‘Short-term loans’ are loans contracted for a period of 12 months or less. Such loans were taken sometimes against some pledge of commodity and sometimes without it. ‘Medium-term loans’ are contracted for duration of one to three years and ‘long-term’ loans for periods exceeding three years.
A scanning of Table 7, which gives the incidence of indebtedness of household both in rural and urban areas as per occupational category for the year 2002, reveals that a relatively larger incidence of indebtedness takes place amongst rural households in medium-term loans and long-term loans. While 11 per cent and 9 per cent of cultivator households prefer medium-term and long-term loans, the non-cultivator households’ percentages were 10 and 8 per cent respectively. In urban areas more households prefer long-term loans.
Average debt amounts are also much higher in medium-term and long-term debt as compared with short-term debt whether pledged or unfledged (Table 9), in respect of all categories of borrowers. It can also be seen from Table 9 that average debt of cultivator in all class of loan is more than double to non-cultivator in rural areas and in urban areas, the average debt of self-employed is more than that of the others category. III Type of Security Security
for Loans One of the constraints that often force borrowers to take loans at higher interest rates is the type of security against which loans are granted.
Incidence It can be seen from Table 10 that the highest number of households, both cultivator and non-cultivator among rural households and self-employed and other households among urban households, have taken loans against personal security that is about 18 per cent out of 27 per cent in all households in rural areas and 12 per cent urban households out of a total of 18 per cent indebted households. The next three important security types were i) mortgage of immovable property (4 per cent and 2 per cent in urban); ii) first charge on immovable property ( 3 per cent in rural and 2 per cent in urban); and iii) surety security, etc (2 per cent in both rural and urban). Amongst, different occupation households also, this pattern holds.
Distribution
of debt amongst different Security Types Percentage shares of debt with personal security top the list with 48 per cent for rural households and 40 per cent for urban households. Mortgage of immovable property with 20 per cent in rural areas and 22 per cent in urban areas holds the second position. The third and fourth positions go to first charge on immovable property ( 16 per cent in rural and 22 per cent in urban) and surety security,etc (8 per cent and 9 per cent in rural and urban). Loans against crop constitute only 5 per cent of cultivator debt (Table 11).
IVDistribution of Debt by Size of DebtThe average cash dues outstanding per household, which was estimated as Rs. 7,539 and Rs. 11,771 respectively for the rural and urban areas at the all-India level, indicates the general level of indebtedness in the household sector. But the percentage distribution of indebted households and of amounts of cash dues outstanding by the size group of such dues reflects the debt borne by different group of households, i.e., debt burden of each households by size.
Table
12: shows the percentage of households reporting debt as well as the share
of such debt outstanding over size group of debt. It can be seen therefrom
that the percentage of households reporting small-sized debt (up to Rs.
15,000) was much higher than that of households taking large debt i.e.
above Rs. 50,000, but their
share in amount of debt is truly small.
Asset Holding and Size of DebtTable 13 shows that the substantial differences in the value of shares existed over asset holding classes, for almost each of the different categories of debt. There is a close association between the debt size and average asset holdings of households. In the rural areas, for the lowest category viz. debt size less than Rs. 10,000, the shares are found to fall shapely with the increase in the asset size. This falling pattern is seen in the next category ie Rs. 10 to 20 thousand. But, exactly opposite trend is discerned in the debt size of 1 lakh and above. The fall in shares is not very sharp in the case of debt size of Rs. 20,000 to Rs. 50,000 and Rs. 50,000 to Rs.1 lakh. More or less the same trend is witnessed in urban areas also.
Summing up (i) The most glaring, though not unexpected revelation, is the high incidence of interest on borrowings from non-institutional agencies : 73 per cent of the total debt in rural areas. (ii) Even for institutional loans, 82 per cent have been in the range of 12 to 20 per cent rates of interest. (iii) In 2002, a tiny 2 to 3 per cent of the debt was extended at concessional debt both in rural and urban areas; about 8 to 10 per cent debt was free of any interest burden; simple interest rate is the most prevailing mode of terms of interest rate and the share of cash debt contracted forms about 69 per cent in rural and urban areas. (iv) about 21 per cent of cash debt in rural areas and 17 per cent that in urban area had been contracted at compound interest rate. (v) In security-wise distribution loans against crop constitute only about 5 per cent of the total debt of cultivator households. (vi) In 2002, about 60 per cent of the cash debt was contracted for a relatively short duration – 36 per cent for less than year and 47 per cent between 1 to 2 years. (vii) There is a close association between the debt size and average asset holdings of households. * This note is prepared by R Krishnaswamy
Highlights of Current Economic Scene AGRICULTURE
The
central government is considering removing the ban on sugar exports
completely and a decision to this effect is likely to be taken by the end
of January 2007. The decision
has been taken in the view of possibility of higher availability of sugar
in the domestic market, around 270 lakh tonne (40 lakh tonnes carried over
from the last season and 230 lakh tonnes of production expected this year)
in the 2006-07 season (October-September), which in turn would not only
create problems for sugar producers to export the surplus thus generated
but also is likely to affect the sugarcane sowings for the next sugar
season. The government had lifted the sugar export ban partially on
December 19, 2006, allowing export by companies with obligation under the
advance licence scheme. As
per the solvent extractors' association of
MMTC,
the state-run trading firm, has received 3 bids for its tender floated in
December 2006 to import 5,000 tonnes each of urad, moong and tur for
February 2007 delivery. MMTC’s
Singapore-based subsidiary MTPL has offered 5,000 tonnes tur at $405-446
per tonne, cost and freight, 5,000 tonnes urad at $697-700 per tonne and
5,000 tonnes moong at about $670 per tonne. While Myanmar-based PL Global
has offered smaller quantities of urad at $760 per tonne and tur at $380
per tonne (both on free on board basis), Dubai-based Agricommodities has
offered only tur at $412 per tonne (cost and freight). However, MMTC is
likely to buy 1,000 tonnes moong from MTPL and 1,000 tonnes tur from
Agricommodities. The
central government has decided to a ban on creation of new agriculture
export zones (AEZ) and has asked the states to reconsider the proposals
pending with them. The government has so far sanctioned 60 AEZs since the
policy was formulated in 2001. However, they have failed to take off in a
significant way even after five years of their existence. The central
government had received 34 proposals for setting up of AEZs, however, it
has decided to strengthen the existing zones, instead of sanctioning more
AEZs. According
to Coffee Board of India, coffee exports from the country during
January-December 2006 have stood at 202,205 tonnes, 20 per cent higher
from a year ago on account of favourable overseas prices and better
supply. A
study undertaken by the centre for economic and social studies (CESS) has
revealed that farmers in Andhra Pradesh have been able attain higher
cotton yields by using Bt cottonseeds during 2004-05 kharif season. The
study was conducted in 4 districts of The
government of Industry
Machine
Tools
The
machine tool industry is set for an investment of Rs 2,000-3,000 crore in
the next 2-3 years. Even while the sector has its limitations in meeting
the domestic demand, resulting in large dependence on imports, the sector
is poised for robust growth which would help in reducing imports while
increasing its edge in the export market through modern technology
induction and marketing strategies. The President of the Indian Machine
Tools Manufacturers' Association (IMTMA), has commented that the machine
tool industry is poised to grow by 35 per cent during 2006-07, triggered
largely by the automobile industry. Additionally, the sunrise sectors such
as the garments and gems and jewellery, furniture and medical equipment
would also give a further fillip to the industry, resulting in capacity
expansion. Though exports are marginal at Rs 50 crore, the increasing
recognition of the sector from global companies is likely to provide
greater opportunities for contract manufacturing and even joint ventures
adding to investments with latest technologies for the sector to grow
faster. As per the IMTMA's vision for the sector, the future focus would
be on closing the technology gap between Indian and international products
through increased productivity, achieving higher consistency and accuracy,
introducing modern safety concepts and enhancing research and development
efforts. IMTMA would also leverage the potential of industry-academia
linkages for innovation and developing new products, concentrating on new
concepts such as mechatronics and hard machining. Pharmaceuticals The
research and development expenditure of the domestic pharmaceutical
industry is likely to grow at about 8-9 per cent of its total sales volume
by 2010 as per the Associated Chambers of Commerce and Industry. This
growth is expected as Electrical
Goods The
power ministry is working on a proposal for the establishment of a second
state-owned power equipment maker on the lines of state-owned Bharat Heavy
Electricals Ltd (BHEL) and may be set up as a unit of generation major
NTPC Ltd. Currently, BHEL, comes under the Ministry of Heavy Industries,
is the only state-run company engaged in power equipment manufacturing,
besides private companies such as Alstom, Siemens and GE. This has been
criticised as paradoxical since BHEL itself has been operating below its
capacity over the last three decades due to lack of demand. Besides,
BHEL's equipment manufacturing capacity of 6,000 MW at present, which has
generally remained underutilised, is being ramped up to 10,000 MW annually
in light of the power generation capacity addition programme. The power
ministry has, however, been maintaining that BHEL, which has over Rs
40,000 crore of orders in hand, is 'overburdened' and, hence, there is a
need to establish another state-owned supplier. Infrastructure Overall
Buoyed
by the oil refinery production and cement sectors, the composite six core
infrastructure sector output has grown by 9.5 per cent in November 2006,
higher than the 5.7 per cent growth experienced a year earlier and also
faster than the 9 per cent annual growth clocked a month ago in October
2006. The index of six core infrastructure industries, having a combined
weightage of 26.7 per cent in the overall Index for Industrial Production,
has stood at 221.6 points in November 2006 as compared to 202.4 points
during the same month in 2005. Infrastructure output cumulatively during
the April-November period of 2006-07 has risen by 7.8 per cent as against
5.2 per cent during the corresponding period a year ago. Power Power
generation in December 2006 has stood at 57.095 billion unit (BU), about
9.3 per cent higher than the generation of 52.257 BU recorded in the
corresponding month of last year. During April-December 2006, the actual
generation of electricity has been 493.419 BU, registering a growth of
7.55 per cent as compared to growth rate of 4.7 per cent in the
corresponding period of 2005. The power ministry has said that the actual
growth in total generation during April-December could have been higher
but for lower growth of about 2.9 per cent in nuclear generation.
According to the ministry, the plant load factor (PLF) of thermal power
stations has touched 78.7 per cent in December as compared to last year's
75.7 per cent. The cumulative PLF during April-December has reached to
74.6 per cent as compared to 71.5 per cent during corresponding period of
last year. Inflation The
annual point-to-point inflation rate based on wholesale price index (WPI)
rose by 5.48 percent for the week ended December 23,2006 as compared to
5.43 per cent in the last week or at a lower rate of 4.62 per cent during
the corresponding week last year. During
the week under review, the WPI rose to 208.0 from 207.8 in the previous
weeks’ level (Base: 1993-94=100). The index of ‘primary articles’
group, (weight 22.02 per cent), rose by 0.3 percent to 212.4 from its
previous week’s level of 211.8, mainly due to higher prices of ‘food
article like bajra, maize, wheat and ragi and fish. The index of ‘fuel,
power, light and lubricants’ group (weight 14.23 per cent) declined by
0.3 per cent to 321.6 from 322.6 due to lower prices of electricity. The
index of ‘manufactured products’ group rose by 0.2 per cent to 180.1.2
from 180.8 during the week under review. The higher prices of food
products like black tea,rice bran oil,and gur pushed up the prices of
manufactured products. The
latest final index of WPI for the week ended October 28,2006 has been
revised upwards; as a result both, the absolute index and the implied
inflation rate stood at 208.9 and 5.35 per cent as against their
provisional levels of 208.4 and 5.09 per cent, respectively. Banking As
an initiative to bring transparency in the valuation of properties held by
banks, the RBI has issued a set of guidelines. The banks should obtain
minimum two independent valuation reports for properties valued at Rs 50
crore or above. As the guidelines on capital adequacy permit banks to
include revaluation reserves at a discount of 55 per cent as a part of
Tier II capital, the notification says that revaluation reserves represent
true appreciation in the market value of the properties. Further
guidelines say disclosure should be made in the ‘Notes on Account’
regarding the details of revaluation such as the original cost of the
fixed assets subject to revaluation and accounting treatment for
appreciation/depreciation etc. Punjab
National Bank (PNB) has received the necessary approvals for patenting its
rating model – PNB Trac, for its entire category of lending. The loans
with exposure of above Rs 20 lakh have been rated individually, while
loans with exposure under Rs 20 lakh have been rated segment-wise on
portfolio basis as per the terms of Basel II accord. Hence, now the bank
would be able to do credit ratings on its own for its lendings. PNB has
developed 13 models for rating of different categories of borrowers. These
models have been deployed at bank branches through a web-enabled software.
PNB is the first bank to get a patent for its large corporate rating model
and is among few banks that have rated their entire loan portfolio. Revamping
its rural banking focus, the country’s largest bank, the State Bank of
India (SBI) has decided to set up 5,000-6,000 rural kiosks and has started
a new rural pilot project, to encourage banking habits among the rural
masses. The project will be in the villages where there is no branch and
there will be a person in-charge who may be a local school teacher, local
shop keeper. Financial
Markets Capital
Markets Primary
Market Indian
real estate developer DLF has filed a prospectus for an initial public
offering (IPO) after pulling a planned issue last year. As per reports,
the sale of 10.2 per cent of the company could raise more than $2 billion.
This offer is expected to be the biggest ever-public issue. Secondary
Market The
first trading week of the New Year began on a positive note. However,
after beginning the year with a bang, the market cooled off later. For the
week ended 5 January 2007, the barometer index BSE Sensex gained 73.61
points or 0.53 per cent to settle at 13,860.52. The S&P CNX Nifty
gained 17 points (0.42 per cent) for the week to settle at 3983.40.
Small-cap and mid-cap stocks outperformed the market. BSE Small-Cap Index
rose 299.23 points or 4.3 per cent to settle at 7,191.55. BSE Mid-Cap
Index gained 131.49 points or 2.26 per cent to settle at 5,936.67. The
markets entered the year 2007 on a positive note. On Tuesday (2 January),
the first day of trading this year, the Sensex settled at 13942.24 gaining
a good 155.33 points. IT and auto stocks played anchor on the day in
pulling up the Sensex. The IT stocks gained in anticipation of good Q3
results while the autos found increased buying interest on the back of
favorable December month sales volumes that were announced on the day. On
Wednesday, the start was not bullish but the markets recovered in mid
afternoon trading. During intra day trading, the Sensex had marginally
crossed its all time high level of 14035.30. The Sensex closed the day
72.68 points higher at 14024.49. Thursday was a day of volatility. However
the volatility was not as strong as witnessed in sessions a fortnight
back. The Sensex swung intra day 210 points. It opened strong on reports
of the center and the state having agreed to phase out Central Sales Tax
(CST) over the next 4 years. It touched an all time high of 14060.35. Then
the correction came in with selling pressure on FMCG, IT and metal stocks
resulting in the Sensex closing at 13871.71, which was 143.21 points below
its previous day close. The markets were plainly flat on Friday. Sensex
closed marginally lower by 11.19 points at 13860.52. The Nifty closed
lower by 5.40 points to settle at 3983.40. On
Friday, Pyramid Saimira Theatre settled at Rs 158.20 on BSE on high volume
of 1.69 crore shares, compared to IPO price of Rs 100. The stock debuted
at Rs 135. It hit a high of Rs 163.85 and low of Rs 125. The company had
priced its IPO at the higher end of the Rs 88 to Rs 100 price band. On the
same day, Tanla Solutions finished at upper circuit of Rs 379.80 on BSE,
compared to IPO price of Rs 265. Tanla Solutions had priced its IPO at the
upper end of the Rs 230 to Rs 265 price band. FIIs
were net buyers to the tune of Rs.3892.90 crore for January 2007 till 4
January 2007. This included FII subscription to the mega IPO of Cairn Derivatives The
turnover in the F&O segment of NSE fell from Rs 38,302 crore in the
week ended December 29 to Rs 11,270 crore
in the week ended January 5, 2007. Nifty futures were traded at
discounts to the spot in the last three trading days of the week. FIIs
were net sellers of derivatives; they bought index futures worth Rs 3,960
crore and sold Rs 4012 crore and in case of stock futures they sold Rs
1673 crore and bought only Rs 1,564 crore.
Turnover
in the options market is poised for a mutlifold increase in the coming
months following a decision by the National Stock Exchange (NSE) to change
the way brokerages are calculated for options contracts. As per the new
rules, effective January 2, brokerage for options contracts will be
charged only on the premium at which the contract is bought or sold and
not on the strike price. Till
now, investors were required to pay brokerage for the strike price, making
it a costly affair. For instance, if a stock is ruling at Rs 500 and an
option contract is bought at a premium of Rs 10, earlier an investor was
required to pay brokerage for Rs 510. From now on, the brokerage will only
be on Rs 10. Government
Securities Market Primary
Market The
Government of India has announced the sale (re-issue) of "8.33 per
cent 2036" for a notified amount of Rs.4000 crore on January 12,
2007. Under
the weekly T-Bill auctions, the RBI mopped up Rs.2000 crore and Rs.2005.10
crore through 91-day T-Bill and 364-day T-Bill. From this, the RBI raised
Rs.1500 crore and Rs.1000 crore under the Market Stabilisation Scheme
(MSS) through 91-day T-Bill and 364-day T-Bill respectively. The cut-off
yields for the 91-day and 364-day T-Bill were 7.1443 per cent and 7.1893
per cent respectively. The cut-off yield in 364-day T-Bill auction moved
lower to 7.1893 per cent as against the previous cut-off yield of 7.2354
per cent. Secondary
Market During
the week, the weighted average call rates during the period ranged between
6.64 per cent and 12.96 per cent, while weighted average repo rates ranged
between 6.31 per cent and 9.96 per cent and the weighted average CBLO
rates ranged between 5.69 per cent and 7.28 per cent. The average volumes
of Call, Repo and CBLO segments were Rs.13,546.45 crore, Rs.6794.35 crore
and Rs.15,052.35 crore respectively. The daily average outstanding amounts
in the LAF (reverse repo) and LAF (repo) operations conducted during the
period were Rs.10,537.50 crore and Rs.6665 crore respectively. The
weighted average YTM of G.S 2016 7.59 per cent bond was 7.5576 per cent on
January 05, 2007 as compared to 7.6239 per cent on December 29, 2006. The
1-9 year YTM spreads decreased by 2 bps to 38bps. Bond
Market Transmission
Corporation of Andhra Pradesh is to tap the market to mobilise Rs 300
crore (green shoe option of Rs 100 crore) by offering 8.59 per cent and
8.69 per cent for 10 years and 15 years respectively.
Foreign
Exchange Market The
rupee-dollar exchange rate depreciated from Rs 44.23 on December 29, 2006
to Rs 44.30 on January 5, 2007. The
six-month forward premia closed at 3.56 per cent (annualized) on January
05, 2007 vis-à-vis 3.60 per cent on December 29, 2006. Commodities
Futures derivatives The
first trading session of the year saw agri futures falling on the National
Commodity and Derivatives Exchange (Ncdex), exuding the weak sentiment
prevalent during the year-end.Pulses and grains was the worst hit, a clear
indication that demand has not gained momentum thus far. The near-month
chana fell 4 per cent below Rs 2,400 mark at Rs 2,356 a quintal against
last week’s close of Rs 2,460. In the pulses category, except Tur desi,
all declined. Urad desi and Masoor slipped by 3.5 per cent and 3 per cent,
respectively. Wheat dropped by
Rs 20, closing at Rs 1,001 a quintal, whereas maize declined Rs 6 a
quintal. Mentha oil, which was hit by sluggish demand, saw no resistance
at Rs 600 levels. On Monday, it closed at Rs 570 a kg against last
week’s close of Rs 589 a kg. Since mentha oil lost its support level at
Rs 625 a kg, the downward rally has seen no halt.
Soybean slipped by Rs 8 to Rs 1,386 a quintal. Sugar M grade saw a
a marginal drop of Rs 1, while mustardseed fell by Rs 3 at the close of
the trading session. Guargum
and guarseed, though during the day were trading above their previous
close, could not sustain the trend and closed below their earlier levels.
Guargum fell 1.5 per cent to Rs 4,790 and guarseed by Rs 16 to Rs 1,945 a
quintal. Spices futures, however, closed at higher ends. Cumin seed (jeera)
closed at Rs 9,190 against Saturday’s close of Rs 8,977 a quintal, up
over 2 per cent. Pepper jumped
by around 3.8 per cent to close at Rs 11,118 a quintal against its
previous close of Rs 10,725 a quintal.
The
National Commodity and Derivatives Exchange (NCDEX) will launch 10 grams
immediate delivery gold contracts, to be traded on its electronic spot
exchanges, in order to increase its bullion clients. The exchange had
earlier started its futures mini gold 100 grams contracts and registered a
delivery of 89 kg of gold during the first month of expiry of these
contracts in December. Insurance The
country’s largest life insurance player, Life Insurance Corporation of
India (LIC) has witnessed a strong rise of 180 per cent in their group
business premium as on December 15, 2006 as compared to Rs 3,900 crore for
the complete fiscal in 2005-06. Of the total Rs 5,900 crore group business
premium nearly Rs 3,000 is contributed from the gratuity business and
another Rs 1,000 crore has been contributed from the super annuation
business. Even the market share in the group business of the corporation
has replicated the success by moving up to 84 per cent from 78 per cent as
on March 31, 2006. Also, during the first nine months of the financial
year 2006-07 LIC has recorded 211 per cent growth in its first year single
premium income, which account Rs 14,823 crore, while the non-single
premium income has grown by Rs 4,255 crore, indicating a marginal increase
by 15.7 per cent. Corporate
Sector The
$730 million acquisition of Jet
Airways had executed a purchase agreement with the Boeing Company, US for
buying 10 Boeing 787-8 series aircraft to maintain and expand the
company’s international operations using wide body aircraft and to
deploy the most modern and economically efficient aircraft. The aircraft
were scheduled for delivery between July 2011 and December 2012, subject
to regulatory approvals.
*These statistics and the accompanying review are a product arising from the work undertaken under the joint ICICI research centre.org-EPWRF Data Base Project. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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