However, IT companies seem to be still maintaining that this is transient, sentimental, and should not impact medium-term prospects. Until now, they said that growth in the US especially in BFSI moderated as discretionary spends were delayed or cut, based on customers sensing macro worries. What do you make out of commentaries by large IT companies announced quarterly and full-year earnings so far? Other risks would be flare-up in crude if OPEC cuts production, or geopolitics – for instance if China blockades Taiwan then supply of advanced chips globally would impact companies, including the seemingly impregnable Apple. There could be some relief when central banks pivot and start cutting, but timing this is difficult.Īlso read: Wipro to consider share buyback on April 27 The rapid and large interest rate increase by central banks has seemingly happened with inadequate attention being paid to the lag effect of monetary tightening last year.Īs earnings suffer a slowdown, discretionary spending, specifically capex, would take a hit, impacting future growth and hence immediate multiples. We foresee an earnings recession led by Western economies but also infecting EMs (emerging markets) and India. What could be the possible biggest risk for the equity markets in the coming year? And the rally already seems to be reversing. We continue to prefer India-focused pharma companies over export/US generic-centered players. In our FY23-25 estimates for 18 pharma stocks under coverage, we have already assumed 8-10 percent CAGR in aggregate US revenue for the coverage, and we believe these numbers already reflect the short-term benefit from supply chain disruptions. While this will be a short-term relief for the sector over the next 1-2 quarters, we believe that after this 1-2 quarter of base reset, the macro challenges of the US generic market will come to the fore again. Pharma stocks have rallied over the past month, on expectations that pricing pressure in the US generic market has bottomed-out, owing to supply chain disruptions at a few of the generic companies. In India we are as yet unsure of inflation trajectory, monetary easing, etc," he adds.Īmong sectors, Venkataraman with more than 28 years of experience in the financial services sector likes lending financials, especially the top two PSU banks - SBI and Bank of Baroda which were battered when the Adani worries shook the market.ĭo you expect a significant rally in the pharma sector? If yes, will it be broadbased or select stocks? "Generally, the IPO momentum picks up when sentiment is strong. Hence, he says it is difficult to be very optimistic about primary market revival when faced with the prospect of an earnings recession. India is the world's second largest producer, consumer and importer of the fuel.Ĭoal India intends to ramp up production to 1 billion tonnes by March 2026 by increasing the capacity of its existing mines and opening new mines.After consistent Fed funds rate increases since March 2022, R Venkataraman, the Chairman of IIFL Securities foresees an earnings recession led by Western economies also infecting EMs (emerging markets) and India. The government has previously cited lower per capita emissions compared with richer nations and surging renewable energy output, when asked about rising coal use.Ĭoal accounts for nearly 75% of India's power generation and utilities account for more than 75% of its coal use. India's coal-fired power output has increased much faster than any other country in the Asia Pacific since Russia's invasion of Ukraine, underscoring the challenges the world's third-largest greenhouse gas emitter faces in weaning its economy off carbon. The miner, which accounts for 80% of India's annual coal output, is targeting production of 780 million tonnes in the upcoming fiscal year, in a bid to fire its power utilities, which are expected to burn about 8% more coal in the year. "The volume increase of a whopping 81 million tonnes in a single year, by fiscal year 2023 end, would be a historic high since the company's inception," the company said in a statement on Friday.Ĭoal India last achieved its annual production target in 2006, when it produced 343.4 million tonnes against a plan to produce 343 million tonnes.
The world's largest coal mining company will likely end the fiscal year ending on Friday with an output of 703.4 million tonnes, it said, 13% higher than the 622.6 million tonnes it produced the previous fiscal year. Coal India Ltd said on Friday it had breached its annual production target of 700 million tonnes, the first time it had surpassed its goal since the fiscal year that ended in March 2006.
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