M-cap of 5 blue-chips falls Rs20,000 crore; SBI leads the decline

SBI’s, the country’s largest lender market capitalisation (m-cap), dropped by Rs13,332 crore to Rs1,40,131 crore. Shares of the company had plunged by over 8% last week on concerns over its exposure to cash-strapped Kingfisher Airlines and reports of public sector lender giving fresh loans to the debt-ridden carrier

Mumbai: Led by a steep decline in State Bank of India’s (SBI) market value on concerns over its exposure to Kingfisher Airlines, the combined market capitalisation of five of the top 10 blue-chip companies eroded by Rs20,409.84 crore, reports PTI.

SBI’s, the country’s largest lender market capitalisation (m-cap), dropped by Rs13,332 crore to Rs1,40,131 crore. Shares of the company had plunged by over 8% last week on concerns over its exposure to cash-strapped Kingfisher Airlines and reports of public sector lender giving fresh loans to the debt-ridden carrier.

State-run NTPC’s m-cap also dipped by Rs3,422 crore to Rs1,51,304 crore, while Bharti Airtel’s worth declined by Rs2,753 crore to Rs1,29,989 crore last week.

HDFC Bank saw an erosion of Rs712.84 crore from its value which was at Rs1,22,755.16 crore, while IT major Infosys lost Rs190 crore from its m-cap which stood at Rs1,69,239 crore at close on last Friday.

In contrast, corporate leader Reliance Industries, IT bellwether TCS, state-owned ONGC, Coal India and FMCG giant ITC reported gains in market value.

Market worth of Reliance Industries surged by Rs802 crore to Rs2,68,625 crore, while TCS added Rs7,917 crore to its m-cap which stood at Rs2,48,400 crore as on Friday last week.

ONGC’s wealth went up by Rs2,524 crore to Rs2,43,189 crore, while CIL added Rs1,516 crore taking its valuation to Rs2,06,703 crore and ITC’s value climbed Rs3,237 crore to Rs1,63,375 crore.

In the broader market, the BSE barometer Sensex fell by about 2% to end the week at 17,923.57 points.

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SBI decides to cut interest on education loans

“The bank has taken in-principle decision to cut (interest on) education loans,” SBI managing director and chief finance officer Diwakar Gupta told reporters. Without giving details of quantum of rate cut, he said, it may be up to 100 basis points

New Delhi: State Bank of India (SBI), the country's largest lender, has taken an in-principle decision to slash interest on education loans by up to one percentage point, reports PTI.

“The bank has taken in-principle decision to cut (interest on) education loans,” SBI managing director and chief finance officer Diwakar Gupta told PTI.

“Announcement would be made soon. The bank will issue the notification shortly,” he added.

Without giving details of quantum of rate cut, he said, it may be up to 100 basis points.

Interest rates on education loans range from 12.25% to 14.50%, depending on their quantum and the duration.

The education loan book of SBI constitutes less than 7% of its Rs1.75 lakh crore retail loan portfolio. In the quarter ended December, the bank saw its education loan books swell by 14.17%.

SBI is also offering a concession of 50 basis points on interest rates for loans given to female students.

Earlier this month, SBI chairman Pratip Chaudhuri had said the possibility of a reduction in base rate at this point of time looks bleak as the bank has absorbed last three Reserve Bank of India’s (RBI) policy rate hikes without raising its base rate.

The lender’s base rate stands at 10% as of now, which is the lowest in the country.

About the possible slashing of home loan rates, he had said the possibility was ‘less’.

“The possibility of (reduction) in home loans is less as the rate is 10.50% and the base rate is 10%. Hence, the possibility is less. Moreover, the tenor of a home loan is 25-30 years, (so) we have to think about it a lot,” Mr Chaudhuri had said.

He, however, had said in case of further CRR cut by the central bank, the entire rate structure will come down.

On 24th January, the RBI had reduced the cash reserve ratio (CRR) by 0.5% to 5.5% to infuse liquidity into the system, and indicated a reversal of tight money policy stance.

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SEBI to hire professional agency to educate investors

The objective of the investor education programme is “to create general awareness on securities market, various products available in securities market and facilitate the participation of the retail investors in the securities market to invest with knowledge,” SEBI said

Mumbai: Capital market regulator Securities and Exchange Board of India (SEBI) will launch a big investor education programme through short films, TV and radio commercials in English and regional languages, reports PTI.

To spread the awareness drive, it plans to hire a creative agency having annual revenue of at least Rs100 crore in the past three fiscal years.

The objective is “to create general awareness on securities market, various products available in securities market and facilitate the participation of the retail investors in the securities market to invest with knowledge,” SEBI said.

The selected agency will provide creative services including production of short films, TV commercials, radio spots and printing advertisements to carry out “SEBI’s Investor Education and Awareness campaign” across the country.

Besides, there will be a separate agency for release of the creative work to various media.

Inviting expression of interest (EOI), the regulator said the agency to be contracted will have to provide in-depth knowledge on the communication strategy to be followed for this campaign.

“The main functions of the agency will be the creation of advertising products which will successfully convey the desired message to the target audience...” SEBI added.

The awareness campaign will be done through five 25-30 minutes short films, ten 30 seconds TV commercials, ten 30 seconds radio spots and ten print advertisements.

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COMMENTS

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