Category — Banking & Financial Services

HSBC: India to be a $7 Trillion Economy in 2028

British financial services giant  HSBC said India is likely to overtake Japan and Germany to become the third largest economy in the next 10 years but needs to be consistent in reforms and focus more on the social sector.

Thire brokerage’s estimates show that India will be a $7 trillion economy in 2028, as compared to less than $6 trillion and $5 trillion for Germany and Japan, respectively. Currently, India is at the fifth spot in global rankings with a GDP of about $2.3 trillion (fiscal 17), reports BusinessLine.

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Other takeaways from the report:

  • Demographics and macro stability were key strengths for the country
  • India needs to create an ecosystem of continuous change
  • An avenue of job creation can be the social sector
  • India will continue to be a services oriented economy but it needs to pay extra attention on manufacturing and farm sectors as well

“Apart from services, other hallmarks of the India story over the next decade will be higher investment and capital goods flows as its focus on manufacturing increases; Indian consumers forcing foreign brands to turn ‘glocal’; and a two-way human capital footprint that will see many skilled people traveling overseas. It (India) needs to broaden its specialization (beyond just IT in business and cricket in sports) if it wants to run harder and fly higher,” the report added.

September 22, 2017   No Comments

U.S. Invests the Most in India’s Startups

According to New York-based CB Insights, U.S.-based investors are the most active foreign participants in India’s start-up ecosystem over the past five years, making over 800 equity deals during the period.

In the list of top five foreign investors in India’s technology ecosystem, U.K., with 1% of deals stood at 5th place; Japan at 4th with 2% of deals; Hong Kong at 3rd with 3% of deals; Singapore at 2nd with 5% of deals; while the U.S. topped with four times the number of deals than investors from Singapore.

Planning in a startup

Business Standard reports: Of the U.S.-based investors, New York-based Tiger Global has been the most active, backing some of India’s largest start-ups, including Flipkart, Ola, and ShopClues, while also making numerous other investments in smaller companies. Hong Kong-based Saif Partners, has backed firms such as Paytm and Urban Ladder. California’s Accel Partners, which has an India unit, made its largest investment in Flipkart through its overseas unit rather than the local one.

Both Tiger Global and Japan-based Softbank have pumped billions of dollars in India’s startup ecosystem in the past few years.

August 31, 2017   No Comments

PE Investments in India Surge 48 percent

According to assurance, tax and advisory firm Grant Thornton India, there were 59 private equity transactions worth $1.22 billion in July this year, and PE investments in India jumped 48% in value terms. July was dominated by investments in start-ups which contributed to 49% of total investment volumes, while the banking sector dominated the PE investment values contributing to 46% of investment values, followed by the pharmaceutical sector.

Magazine with Investment Report written on it“The sector focus this month for PE seems to be the BFSI sector with manufacturing and pharma rallying closely behind,” Grant Thornton India LLP Partner Prashant Mehra said. “The sector flavor for this year has been around the core sectors and we will perhaps continue to see this trend as positive macro-economic factors boost these sectors the most. Also, from an exit through IPO perspective, the probability for success is more in core sectors than others,” Mehra added.

Mehra expects that the key growth will perhaps be from PE deals which serve as an alternate means of financing M&A in India, reports Live Mint.

August 18, 2017   No Comments

Income Tax Collections Rise 42 percent in India

Tax compliance in India has improved: more than 28.2 million taxpayers filed their tax returns for the 2016-17 financial year before the extended deadline of August 5 — a 24.7% increase over the previous year, the Federal Board of Direct Taxes announced. Though the deadline for filing returns is over, taxpayers can file returns for FY17 till 31 December, after paying a penalty of $78.

Live Mint reports that the number of individual filers rose 25.3% in the April-August tax period of 2017-18 to 27.9 million, the Federal board of Direct Taxes said. The amount of advance personal tax collected during the period also surged 42% over the same period of last year.

“Part of the growth in returns filed can be attributed to the demonetization exercise. Those who have made cash deposits in banks after demonetization may be among those who have newly come into the category of return filers,” said Amit Maheshwari, partner, Ashok Maheshwary and Associates Llp.

 

Taxes

 

August 13, 2017   No Comments

Mobius: Stock Indices in India May Double in 3-4 Years

Dr. Mark Mobius, executive chairman of Templeton Emerging Markets Group, an affiliate of  San Mateo, CA-based Franklin Templeton Investments, expects India’s Stock Exchange indices,the  Nifty and the Sensex to double within the next three or four years.

“This is  due to the high growth rate of the country and a more rational interest environment where interest rates are more in line with what the market is able to pay,” Mobius said in a phone interview from Singapore.

Mark Mobius
“Also, you will see the foreign reserves of the country will continue to grow. In addition, if liberalization continues, you will see much more foreign investment coming in, in addition to the domestic investment,” he added.

Mobius explained that as interest rates get lower deposit rates become lower too and this will drive people to invest in equity markets. He believes that though India’s markets are booming on consumption rates currently, infrastructure is likely to emerge as a bigger theme. This will happen “from privatization of the state-owned enterprises; part of it will come from raising money for infrastructure projects, and of course, the way you do that is by making it safer for infrastructure investors to go into the market,” he said.

Mobius added that geopolitical risks bothering India could be of concern, reports Live Mint.

 

 

August 13, 2017   No Comments