MRF 'Tyres' New Heights, Rolls into the ₹1 Lakh Club

Wednesday, June 14^th 2023

Good Morning ☕

MRF's shares have reached the stratospheric heights of INR 1 lakh per share, proving that in the stock market, their tires are truly inflated with success. It seems like MRF is on a roll, driving towards profits and leaving its competitors in a flat tire frenzy. Who knew tyres could tread the path to stock market stardom!

1. GST Council may consider defining online gaming to resolve tax stalemate

The GST Council in India may consider defining online gaming as a supply of service to exempt winnings from GST. The legal position, which is also a part of the GoM report, will be placed before the GST Council. The taxation of online gaming, horse racing, and casinos may be discussed at the upcoming 50th meeting of the GST Council. The GST law panel is also working on defining "games of skill" and "games of chance" in the online gaming sector.

2. MRF becomes the first Indian stock to touch ₹1 lakh per share mark

Indian tyre manufacturer MRF has become the first Indian stock to reach the INR 1 lakh ($1,340) per share mark. The company's shares have risen by more than 50% this year, with strong demand for tyres in the country's growing auto sector. MRF is the largest tyre maker in India and has a market capitalization of over INR 50,000 crore ($6.7 billion). The company's shares are not widely traded, with only around 1,000 shareholders, mostly high-net-worth individuals and institutions.

3. Inflation, growth trend on track for first rate cut by RBI in early 2024

According to a recent report, economists predict that the Reserve Bank of India (RBI) will hold its key interest rate unchanged at 6.50% on June 8 and for the rest of 2023 as it waits to see the economic impact of a series of hikes over the past year. Despite hitting an 18-month low of 4.70% in April, inflation is not expected to fall to the RBI's 4% medium-term target for at least another two years, suggesting rate cuts are unlikely in the immediate future. However, economists predict that the RBI will cut rates by 25 basis points in the first quarter of 2024 as inflation moderates and the economy stays resilient.

4. India has an unfinished agenda on countering money laundering & terrorism financing

India is due for its Financial Action Task Force (FATF) review later this year. The country has made significant progress on all core and key recommendations and was consequently removed from the regular-follow up process. However, there are still some important and long-standing legal issues that remain to be resolved. A strong Anti-Money Laundering (AML)/ Combating the Financing of Terrorism (CFT) regime is not only important for India from a domestic policy standpoint but also for enhancing its international standing. Complying with FATF recommendations is accordingly high on India’s priority list

5. Adani Group in talks for first major debt refinancing of $3.8 billion: Report

Adani Group is in talks with global banks to refinance up to $3.8 billion of a loan facility taken for its Australian coal terminal after the Hindenburg Research report. The company has been seeking to burnish its credit profile after a short-seller attack. Adani has told creditors it has secured a $3 billion loan from a sovereign wealth fund. The group has also announced plans to prepay or repay share-backed loans worth $790 million by March-end. Adani Green Energy also plans to refinance its 2024 bonds via an $800 million, three-year credit line.

6. Prime Minister Narendra Modi to receive 21-gun salute welcome during US visit

Indian Prime Minister Narendra Modi is set to receive a 21-gun salute welcome during his visit to the United States from June 21 to June 24. The visit comes following an invitation from US President Joe Biden and First Lady Jill Biden. Modi is expected to address a joint session of the United States Congress on June 22 and attend an event at the UN Headquarters in New York to mark International Yoga Day. He is also scheduled to address a gathering of 7,000 Indian Americans on the South Lawns of the White House and attend a state dinner on June 22.

7. Subhash Chandra, Punit Goenka move SAT against SEBI’s order: Report

Subhash Chandra and Punit Goenka have reportedly moved the Securities Appellate Tribunal (SAT) against the Securities and Exchange Board of India's (SEBI) order on the principle of natural justice. The SEBI had barred the two from the securities market for three years, alleging that they had violated insider trading norms. The two have reportedly challenged the order on the grounds that they were not given an opportunity to present their case before the SEBI's adjudicating officer.

8. India needs sectoral strategies to enhance export competitiveness

India needs to develop sectoral strategies for enhancing export competitiveness, especially for electronics, engineering, pharmaceutical, and high-tech industries, to increase outbound shipments to USD 2 trillion by 2030. According to Rakesh Mohan Joshi, Director of the Indian Institute of Plantation Management Bengaluru (IIPMB), competitiveness across the exports value chain is the key to India's exports growth and its sustainability. He added that India needs to evolve sectoral strategies for export competitiveness, especially for engineering goods, pharmaceutical, electronics, and high-tech industries. To increase value realization in merchant exports, India needs to climb up the value chain with higher value addition and branding for international markets.

9. Govt charts new rules for Oppo, Realme, and other Chinese mobile companies

The Indian government has requested Chinese mobile phone manufacturers operating in India, including Xiaomi, Oppo, Realme, and Vivo, to involve Indian partners in their local operations. The government has reportedly come up with a plan to tame Chinese smartphone makers who now rule the roost in India. The companies have been asked to include Indian equity and appoint Indian executives in key positions. The move is aimed at reducing the dominance of Chinese companies in the Indian market and promoting local participation in the mobile phone industry.

10. Food Secretary asks state officials to ensure adherence to wheat stocking limits

The Food Secretary of India has asked state officials to ensure adherence to wheat stocking limits. The move comes as the government seeks to curb hoarding and ensure adequate supply of wheat in the market. The Department of Agriculture and Markets regulates vendors at farmers' markets to ensure compliance with New York State food sanitation requirements and to ensure that food is not contaminated. The Produce Safety rule establishes science-based minimum standards for the safe growing, harvesting, packing, and holding of produce. The USDA has announced a framework to transform the food system to benefit consumers, producers, and rural communities by providing more options, increasing access, and creating new, more, and better markets for small and mid-size producers.

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