Be alert in choosing distributors
Mumbai: Banks have lately acquired a unique status in the realm of mutual funds. One, they have become very large investors themselves. Two, some of them are major distributors of financial products, chiefly MFs and insurance. Every year banks in India manage to raise huge sums of money from their depositors at cheap rates. If you keep your money in a savings account, the bank simply deploys it prudently. It pays you next to nothing in return. Massive amounts of money are kept in such accounts by ordinary savers, a large number of whom are known to have done this for generations. For yesterday's generation, this probably made sense as banks offered fairly high rates of interest when compared to what they offer today. The situation has changed drastically in recent years, and the banks are no more the generous givers they used to be.
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FIIs' stake up in HDFC Bank
Mumbai: Even as public sector banks continue to bask in the newfound interest of institutional investors, HDFC Bank seems to remain a favourite with foreign institutional investors (FIIs) increasing their stake in the bank by over 4.5 percentage points during the last quarter. A look at the Bank's shareholding pattern over the previous two quarters reveals that FII holding has gone up from 18.55 per cent during the quarter ended December 2002 to 23.26 per cent in the March 2003 quarter. Also, the March quarter has seen two new FIIs taking exposure in the Bank - Small Cap World Fund Inc and T Rowe Price International Inc. While Small Cap World Fund Inc holds 3.19 per cent in HDFC Bank as of March 31, 2003, T Rowe Price International through T Rowe Price New Asia has taken one per cent stake, according to data available with the exchanges.
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Wipro hits 52-week low
Mumbai: Aided by good sales figures from Cisco Systems Inc, the upbeat mood at the US bourses got further fillip on hopes that corporates will announce increased profits and the economy will revive. The confidence lifted the Standard & Poor's 500 Index to its fifth straight weekly gain, the longest streak in almost nine months. For the week, the S&P 500 jumped 1.2 per cent. According to the Bloomberg data, the winning streak is the longest since the five weeks ending August 23. The Nasdaq jumped 1.2 per cent, also its fifth consecutive advance and the first time it gained five weeks in a row since the period ended December 7, 2001. The Dow rose 0.9 per cent this week.
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US-64 redemption outgo seen lower at Rs 2,000 crore
New Delhi: The cash outgo for the US-64 redemption is likely to be around Rs 2,000 crore against Rs 6,500 crore budgeted this year with large investors opting for the 6.75 per cent tax-free bonds. Official sources have said that the tax-free bonds have had a good response and preliminary estimates put the investments around Rs 10,000 crore with practically all institutional and large investors opting for it. With savings of around Rs 4,500 crore in cash outgo apportioned for US-64 redemption this year, the fiscal deficit is likely to be less to that extent, the sources said. Fiscal deficit is estimated to be 5.6 per cent of the GDP for this year.
The government had announced the five-year 6.75 per cent tax-free and tradeable bonds effective from June in a bid to reduce the redemption pressure
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