Capex trend will be determine the pace of recovery, says Morgan Stanley

The government will continue to take policy measures to revive investments spending that will help to stabilize private corporate capex, says Morgan Stanley

The slower growth in central government spending, which is about 14.5% of GDP (gross domestic product), means that GDP growth rates will be constrained in the near term even as growth has already slipped to a 10-year low in FY2013. The moderation in central government expenditure growth will act as a natural drag on aggregate demand and hence GDP growth. Moreover, rural consumption, which had earlier benefitted from fiscal transfers and high rural wage growth, will also moderate as support from these factors wanes. While moderation in CPI should help urban real income growth, without a strong recovery in employment growth, overall consumption growth recovery will be slow. Consequently, in the near term, the importance of capex and exports as growth drivers will increase, says Morgan Stanley.


Some of the key factors affecting private investment sentiment over the last three years have been volatile global capital markets, relatively high energy prices, inflation and cost of capital and corruption-related investigations and slowdown in execution of the government’s administrative machinery. While the government’s recent efforts to revive investment have helped improve public capex (largely state-owned enterprises and government departments), private investment trend has been weak. 


Most indicators of capex imply that investment to GDP is stabilizing at low levels. While public sector capex appears to be recovering, private capex remains weak, points out Morgan Stanley.


“We are building in a gradual recovery in export growth based on developed markets growth trajectory and assume that the government will continue to take policy measures to revive investment spending that will help to stabilize private corporate capex. We believe that developed markets’ domestic demand outlook and policy measures to revive investment spending are the key anchors for economic revival,” argues Morgan Stanley. “Indeed, we have consistently argued that measures other than monetary policy are more crucial for reviving investment. In this regard, the government has taken a number of steps to prevent the persistent decline in investment to GDP. Moreover, the budget for Fy2014 announced small measures to encourage investment such as tax allowance for investment and higher quota of tax-free infrastructure bonds,” the global investment bank added.


The finance minister has indicated that the government intends to allow public/private partnerships in the coal industry, reviews of oil & gas exploration policy to move from profit-sharing to revenue-sharing contracts, and the announcement of a policy to encourage exploration and production of shale gas. Some of these proposals are slightly longer term in nature and thus the impact on investment growth would take time.

The report concludes with the forecast, “We are currently building in a gradual recovery in GDP growth in FY2014 to 6% (lower than the earlier estimate of 6.2%) as compared to our estimate of 5.1% for FY2013.”


Another online survey company luring people claims to provide thousand dollars a month by just filing online surveys once you pay its registration fee. However, according to ScamXposer, many companies like GetCashforSurveys are just collecting your personal data to sell to third parties

Almost two years after Moneylife exposed Speak Asia, a multi-level marketing (MLM) company that lured lakhs of people from India into its trap, ‘survey’ companies continue to thrive. is sending emails to thousands of people, especially from India, with a promise to pay $50 (about Rs1,000) when you take your first paid survey. It claims, “There are thousands of companies out there who are willing to pay for your opinions regarding their products. This is an important part of product research, and they rely on people just like you for your honest opinion!”


 “Imagine getting paid for doing things like: Trying out new menu items from popular restaurants—Take short surveys about new cars that are coming out soon—Give your opinion about new clothing and shoe designs,” goes its email pitch.


The pitch, however, fails to mention the joining fee. The company charges $74 for becoming a member, but as a special privilege offers 50% discount through a 24x7 ready coupon. This means, the discount is available for everybody and anytime. It says, “Companies need survey takers in India so we are able to offer you a 50% OFF coupon for new members!”


In case you are still not convinced, the site offers you three more products as an added bonus valued at $89.95. It includes “Get paid to drive”, “Get paid to write” and “Get paid to read emails”. It claims that one can get a free car and earn up to $1,000 a month by using the “Get paid to drive” product. Similarly, it claims one can earn up to $10-30 per hour by writing and $100 a month by simply reading emails.


Only thing the site doesn't tell you is how this is possible.


As for charging $37 ($74 minus the 50% discount) for registration is concerned, says it charges a small fee to cover costs associated with its web hosting and customer service team.


According to, the claims by that one can earn thousand dollars every week are unfeasible. “Most times, you might not even qualify to take many of the surveys, as the research companies are looking for certain consumers in their criteria. Some survey don’t even pay out, they are sometimes entries to drawings. Many companies like Get Cash for Surveys are just collecting your personal data to sell to third parties, so their claims that you can make thousands per month is just a way to lure you in to give them your information to use as they see fit,” it says.


Details like owner or administrator for are not available since it uses privacy protection service. According to database till 18 June 2009, the site owners used services from Whois Privacy Protection Service Inc to protect their identity. At present, uses services from Moniker Privacy Services to keep its identity hidden. The site is registered with Moniker Online Services Inc.


Nifty, Sensex may try a feeble rally: Wednesday Closing Report

Nifty may try to rally but it may not sustain beyond 5,920

The market settled over 1% lower as investors wait for the release of the headline inflation numbers for February tomorrow. Lacklustre global markets also weighed on the sentiments. The Nifty may try to rally but it may not sustain beyond 5,920. Around 55.67 crore shares were traded on the National Stock Exchange (NSE) while the advance-decline ratio was 408:1088.


The market opened in the negative tracking unsupportive global cues. The US markets closed flat with a mixed bias overnight in the absence of any fresh trigger. The Asian pack was lower in morning trade as authorities in Shenzhen, a city in southern China, banned developers from raising new home prices, giving rise to speculations that the tightening might increase further.


The Nifty opened 29 points lower at 5,885 and the Sensex started off at 19,512, down 53 points from its previous close. While the opening figure on the Sensex was its intraday high, the Nifty touched its high at around 11.20am with the index at 5,894. Selling pressure in IT, auto and banking stocks kept the benchmarks range-bound in the negative terrain.


Tata Motors global sales fell 22.36% in February to 98,837 units against 1,27,318 units sold in the same month last year. However, sales of luxury brands from Jaguar Land Rover were up at 35,485 units against 32,257 units. While sales of luxury sedans of Jaguar brand stood at 7,102 units, Land Rover sales were at 28,383 units, the company said in a statement.


A negative opening of the key European markets ahead of the release of the Eurozone industrial output data for January, weighed on domestic investors in post-noon trade.


The benchmarks touched their intraday lows in the last few minutes of trade on across-the-board selling, which saw all sectoral gauges, except the BSE Fast Moving Consumer Goods, staying in the negative. The Nifty touched 5,842 and the Sensex fell to 19,339 at their respective lows.


Settling in the negative for the third straight day, the Nifty fell 63 points (1.06%) to 5,821 and the Sensex dropped 202 points (1.03%) to close at 19,363.


Among the broader markets, the BSE Mid-cap index declined 1% and the BSE Small-cap index dropped 1.27%.


BSE Fast Moving Consumer Goods (up 0.50%) was the lone gainer in the sectoral space. The losers were led by BSE Bankex (down 2.18%); BSE Consumer Durables (down 1.57%); BSE Auto (down 1.53%); BSE PSU (down 1.41%) and BSE IT (down 1.18%).


Six of the 30 stocks on the Sensex closed in the positive. The main gainers were Sun Pharmaceutical Industries (up 1.25%); ITC (up 0.89%); Bharti Airtel (up 0.76%); Hindustan Unilever (up 0.59%) and Coal India (up 0.14%). The major losers were Hindalco Industries (down 3.67%); ICICI Bank (down 3.25%); Bajaj Auto (down 3.16%); Maruti Suzuki (down 3.07%) and Jindal Steel & Power (down 2.84%).


The top two A Group gainers on the BSE were—Lanco Infratech (up 6.26%) and IRB Infrastructure Developers (up 2.47%).

The top two A Group losers on the BSE were—Core Projects (down 5.70%) and Zee Entertainment Enterprises (down 5.61%).


The top two B Group gainers on the BSE were—Riba Textiles (up 18.93%) and Intense Technologies (up 18.08%).

The top two B Group losers on the BSE were—Polytex India (down 19.98%) and KGN Enterprises (down 19.98%).


Of the 50 stocks on the Nifty, 10 ended in the green. The key gainers were Sun Pharma (up 1.11%); Bharti Airtel (up 1.10%); Asian Paints (up 0.98%); ITC (up 0.97%) and HCL Technologies (up 0.72%). The top losers were Hindalco Ind (down 3.77%); ICICI Bank (down 3.48%); Bajaj Auto (down 3.45%); Kotak Mahindra Bank (down 3.43%) and JSPL (down 3.38%).


Markets across Asia settled lower as investors were worried that the Chinese curbs on property prices would dent economic growth. In another development, the head of the People’s Bank of China said his aim was to keep credit growth stable with a focus on GDP and retail inflation. Stocks in Japan settled lower as the yen strengthened against other world currencies.


The Shanghai Composite dropped 0.99%; the Hang Seng tanked 1.46%; the Jakarta Composite declined 0.70%; the KLSE Composite contracted 0.84%; the Nikkei 225 fell 0.61% and the Straits Times settled 0.68% lower. On the other hand, the Seoul Composite rose 0.32% and the Taiwan Weighted added 0.01%.


At the time of writing, the key European indices were down between 0.13% and 0.75% and the US stocks futures were trading with minor losses.


Back home, foreign institutional investors were net buyers of equities amounting to Rs733.25 crore on Tuesday whereas domestic institutional investors were net sellers of shares totalling Rs877.38 crore.


Bangalore-based Purvankara Projects today announced plans to raise around Rs450-Rs500 crore through the institutional placement programme or IPP. The funds raising will be done in the price range of Rs100-RS110 a share. The stock declined 4.16% to close at Rs91.05 on the NSE.


State-owned lender United Bank of India has received approval from its shareholders for preferential allotment of up to 1.37 crore equity shares to the Government of India at issue price of Rs72.95 a share. The stock fell 1.56% to close at Rs63 on the NSE.


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