Business Today

Business Today 13-Jun-21

A leading business magazine read by the business leaders for staying ahead and managing challenges that comes right away in the ever changing world of business.

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Living Media India Limited
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26 Edições

nesta edição

2 minutos
great risks on the horizon

Stock markets have continued to defy gravity despite 18 months of relentless onslaught of Covid. The Sensex, for instance, currently rules at 32x the price-earnings multiple — 25 per cent higher than 25.5x PE multiple of the world’s best known index, the Dow Jones Industrial Average. The Sensex is also the most expensive in Asia, almost twice as expensive as the Shanghai Stock Exchange. In India, as much as in many other parts of the world, markets have shown that they are looking beyond Covid for better times ahead. They expect an uptick in sales across sectors as economies get back to life, and due to superior corporate earnings arising out of enormous belttightening, better debt management and expenditure management. That’s as far as hope goes—just what the stock markets rely…

1 minutos
lockdown costs have shrunk, says report

↘ After factoring in recent developments and new restrictions, the economic cost of the latest shutdowns is $1.25 billion per week, down from around $3.5 billion in the 2020 (strict partial) lockdown, according to a Barclays India estimate ↘ In a full lockdown scenario, losses will rise to $5.3 billion per week (in bearish case). ↘ The costs of the lockdown reflect the widening geographical spread of the second wave, which will have an impact on growth through end June, says the report LOCKDOWN COSTS PER WEEK ($billion)…

8 minutos
on a weak base

There is an old saying that when a pigeon sees a cat, it closes its eyes, and assumes that it is safe. Indian equity markets are being just that pigeon, ignoring risks and overlooking facts. Despite reality staring in the face, investors refuse to pay heed to econom ic and financial risks due to the disruption from the second wave of coronavirus. Defying the rising death count, case load and slow pace of vaccination, the benchmark BSE Sensex reclaimed mount 50K even as daily official deaths hit an all-time high of 4,329 on May 18 and state after state announced lockdowns to slow the spread of the virus. With this, Sensex is up 5.1 per cent since the beginning of the calendar year, trading at a price to earnings (P/E) multiple…

1 minutos
the warning signs

HIGH VALUATIONS Sensex P/E multiple is among the highest in the world. BSE Small-cap index is at 62 times trailing earnings per share INPUT COSTS Commodity prices have risen sharply over past few months. This will hit financials of a large chunk of companies, especially those in the manufacturing business EARNINGS Analysts have lowered earnings forecasts as majority of non-essential services and manufacturing activities have come to a halt in most parts of the country GDP DIP Global agencies have lowered GDP growth forecasts due to Covid-19 second wave. This means performance of India Inc. will also be impacted INFLATION In April, wholesale price index-based inflation surged to 10.49 per cent. This increases the risk of rise in interest rates…

1 minutos
the risks

Earnings Per Share Have Been Dipping in Most Recent Periods… BSE Sensex Trailing Earnings Per Share (₹) …But P/E Multiples Remain Way Above Average BSE Sensex Trailing P/E Multiples Sensex Among Most Expensive Indices P/E Ratio (trailing 12 months) S&P BSE Sensex, India 31.2 Jakarta Composite Index, Indonesia 29.6 S&P 500, USA 29.2 Dow Jones Indus. Avg, USA 25.5 Kospi Index, South Korea 20.3 Nikkei 225, Japan 19.7 FTSE Bursa Malaysia KlCI, Malaysia 19.2 Taiwan Taiex Index, Taiwan 17.1 Shanghai SE Composite, China 15.9 IBovespa Index, Brazil 14.9 Hang Seng, Hong Kong 13.6 Wholesale Inflation Spike Will Raise Input Costs of Companies Trend in wholesale price Index (all commodities, in %) A Number of Agencies Have Lowered GDP Growth Forecasts (For FY22)…

7 minutos
future winners

The fatal second wave of coronavirus is ravaging the nation. But unlike in last year’s wave, domestic stock markets have been resilient this time. After rising in February and March, the Sensex fell just 1.5 per cent last month, amid extreme panic. The reasons — hope that immunisation will pick up pace over the next few months, optimism about corporate earnings growth and expectations that government and the central bank will come out with expansionary policies if the economy gets into serious trouble like last year. The benchmark index has delivered a 1.7 per cent return year-to-date (YTD). “The market has discounted a sharp rise in cases. A further spike in coming days cannot be ruled out. The market is factoring in that cases under the second wave will peak by…