Category: Personal Finance

HDFC Life Unveils ‘HDFC Life Saral Pension’ With Lifetime Fixed Income Benefit: Details Inside

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Eligibility

Here you can check your eligibility and the minimum or maximum entry age according to HDFC Life.

Parameters Minimum Maximum
Age at entry (last birthday) 40 years 80 years
Single Life Joint Life No Limit
Purchase Price In Rs 2,23,048 (Yearly) 2,22,635 (Yearly)
2,26,560 (Half-yearly) 2,26,140 (Half-yearly)
2,28,416 (Quarterly) 2,27,992 (Quarterly)
2,29,592 (Monthly) 2,29,166 (Monthly)
Annuity payout (Rs) per frequency 12000 (Yearly) No Limit
6000 (Half-yearly)
3000 (Quarterly)
1000 (Monthly)
Source: HDFC Life

HDFC Life Saral Pension Benefits

HDFC Life Saral Pension Benefits

  • Single & Joint Life annuity options
  • Option to get annuity payments for the rest of your life or the life of your spouse.
  • Annuity payments shall be made monthly, quarterly, half-yearly, or annually.
  • Higher annuity rates for large purchase prices.
  • Refund of the purchase price upon death of the subscriber.
  • On the diagnosis of critical illnesses, a 95% surrender value is issued.
  • .Assured lifelong income – Once purchased, an annuity is promised for lifetime.

Higher annuity for large purchase price

Higher annuity for large purchase price

The annuity rates differ depending on the purchase price range. According to HDFC Life, the purchase price bands are as follows:

Band Purchase Price (Excluding GST)
BAND 1 Less than Rs. 2,00,000
BAND 2 Rs. 2,00,000 to Rs. 4,99,999
BAND 3 Rs. 5,00,000 to Rs. 9,99,999
BAND 4 Rs. 10,00,000 to Rs. 24,99,999
BAND 5 Rs. 25,00,000 and above
Source: HDFC Life

By citing an example, HDFC Life has stated on its official website that “For a 60-year old male annuitant who wishes to purchase a life annuity with return of purchase price with corpus of Rs 25 lacs will get monthly annuity of Rs 11,213. Likewise, for a 60-year old male and 55 year female, who wishes to purchase a Joint life annuity with 100% annuity to secondary annuitant with return of purchase price with corpus of Rs 25 lacs will get monthly annuity of Rs 11,071.”

Annuity payout

Annuity payout

Through ECS/NEFT, the annuity payment will be instantly credited to your registered or specified bank account. From the date of purchase of the plan, the annuity will be paid in arrears at the end of the specified annuity payment frequency. This means that annuity payouts for annual frequency will occur one year after purchase, half-yearly frequency will occur six months after purchase, quarterly frequency will occur three months after purchase, and monthly frequency will occur one month after purchase. Annuity payments for other than yearly frequencies shall be as follows:

Frequency Annuity Instalment (per frequency)
Half-yearly 98.45% of Yearly Annuity x ½
Quarterly 97.65% of Yearly Annuity x ¼
Monthly 97.15% of Yearly Annuity x 1/12

Survival, Death & Maturity Benefit

Survival, Death & Maturity Benefit

Survival Benefit

For Single Life: For Life Annuity with Return of 100% of Purchase Price: Annuity Payments will be made in arrears for as long as Annuitant is alive, as per the chosen mode of annuity payment.

For Joint Life: For Joint Life Last Survivor Annuity with Return of 100% of Purchase Price (ROP) on death of the last survivor: Annuity will be paid in arrears for as long as the Primary Annuitant and/or Secondary Annuitant is alive, as per the chosen mode of annuity payment.

Death Benefit

For Single Life: For Life Annuity with Return of 100% of Purchase Price: On death of the Annuitant, the annuity payment shall cease immediately. The Purchase Price shall be payable to nominee(s) / legal heirs.

For Joint Life: For Joint Life Last Survivor Annuity with Return of 100% of Purchase Price (ROP) on death of the last survivor:

  • On first death (of either of the covered lives):100% of the annuity amount shall continue to be paid as long as one of the Annuitants is alive.
  • On death of the last survivor: The annuity payments will cease immediately. The Purchase Price shall be payable to the Nominee(s) / legal heirs.

Maturity Benefit: There is no maturity benefit provided under this plan.



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New Hallmark Rules In India: How It Is Impacting Gold Buyers and Why It Becomes Tough For Jewellers?

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Planning

oi-Kuntala Sarkar

|

The recent hallmarking rules have reformed the gold jewellery segment in India. The union government came up with new rules that have obliged the jewellery sellers to sell gold with hallmark. But for now, jewellers can continue to buy old gold jewellery back even without a hallmark from the consumers. The 20, 23 and 24 carat gold will also be hallmarked.

How It Is Impacting Gold Buyers and Why It Becomes Tough For Jewellers?

From now on this will give people the assurance of buying pure gold. Hallmarking of gold jewellery assures buyers purity of the precious metal. Presently, only 30% of the Indian Gold Jewellery is hallmarked. The new rules are expected to improve the segment and make it more professional and authentic. Also, the World Gold Council has informed that India has around 4 lakh jewellers. But out of them, only 35879 are Bureau of Indian Standards (BIS) certified.

In addition to that, a Hallmarking Unique ID or HUID has been created for each hallmarked jewellery piece. HUID is a six digit alphanumeric code. This ID will be given at the time of hallmarking. This is in the eye of all the new chaos. Some of the industry insiders are saying that is HUID is delaying the process of jewellery certification.

The government has decided to implement this in 256 districts in the first phase. These districts already have assaying marking centres. But the jewellers who have an annual turnover up to Rs. 40 lakh will be exempted from the new mandatory hallmarking system.

This mandatory hallmarking of gold jewellery has been introduced in India during mid-June 2021. From that time in more than one month, the number of jewellers registering with the Bureau of Indian Standards (BIS) to sell hallmarked jewellery has jumped. The figure went doubled to 74,000. It shows that the Indian jewellers are trying to get accustomed to the new rules, the pace is slow though.

The union government implemented the rules within a very short span of time and caught the jewellers with surprise. Hence, the businesses did not get much scope to prepare them for the new ecosystem. According to an official statement by the All India Gem and Jewellery Domestic Council (GJC), this decision brought confusion, immense unrest and disruption amongst jewellers.

GJC also said that the government did not include several vital points. These were discussed during a meeting between the industry stakeholders and the union government on June 15, 2021. GJC Chairman Ashish Pethe commented, “A very important point of one-time registration for jewellers and no renewal with the BIS is still not clearly mentioned in the FAQs on the BIS website. Another significant point about hallmarking being applicable only at the first point of sale is also missing.”

The jewellers are also likely to face it tough, with the fact that they will have to tag their jewellery pieces with a unique ID and upload the details on the BIS website. Then they can send it to ‘Assaying and Hallmarking Centres’ or AHCs for hallmarking. It means that not only the AHCs, but also the jewellers will be involved

However, this decision has been taken after numerous postponements and multiple dialogues with the industry stakeholders. Importantly, The BIS Hallmarking Regulations were implemented in June 2018.

In the last 1.5 months around 72 AHCs out of 933 have been suspended due to the new regulations. Here this is important as these 72 assaying centres have been working in the country for decades. Now, these have been suspended, which means earlier they might have done irregularities with the rules.

Story first published: Friday, August 6, 2021, 10:01 [IST]



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Sharekhan Recommends These 2 Stocks To Buy For Sound Returns

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GAIL India

Current market price Rs 142.70
Target price Rs 196

Sharekhan has increased its FY2022-FY2023 earnings on GAIL estimates to factor in improved volume outlook for petrochemicals segment (as the management guided to achieve 100% utilisation in FY2022) and higher profitability for LPG-LHC business.

The recent sharp correction in GAIL’s stock from its 52-week high of Rs 170 provides a good entry opportunity for long term investors as earnings outlook (expect a 34% net profits compounded annual growth rate over FY21-FY23E) remains strong given sustained high-crude linked commodity prices and a potential sharp improvement in RoE to 16.4% in FY2023E.

“GAIL’s valuation of 5.7 times its FY2023E EV/EBITDA is attractive, and we expect the company to be the key beneficiary of the government’s aim to increase the share of gas in India’s energy mix, as the same provides sustainable volume growth opportunity for its gas pipeline and trading business. Additionally, potential value unlocking from monetisation of gas pipeline assets would act as a key re-rating catalyst. Hence, we maintain our Buy rating on GAIL with an unchanged target price of Rs 196,” the brokerage has said.

Gujarat Gas: Buy with a price target of Rs 890

Gujarat Gas: Buy with a price target of Rs 890

Current market price Rs 770
Target price Rs 890

According to Sharekhan robust margin performance was driven by full benefit of the Rs. 9/scm price hikes taken in Jan-Feb, and lower gas cost on account of decline in spot LNG price and higher use of domestic gas. Industrial PNG volume declined by 19% q-o-q to 7.8 mmscmd as demand from Morbi customers fell by 23% q-o-q to 5.6 mmscmd.

“Management maintained its 10% p.a. volume growth guidance for next 3-4 years and FY22 margin guidance of Rs. 5.5-6/scm. Volumes recovered to 12 mmscmd but EBITDA margin likely to fall to Rs. 4-4.5/scm on recent surge in spot LNG price.

We maintain a Buy on the stock of Gujarat Gas with a revised target of Rs. 890. Gujarat Gas industry leading volume/earnings growth outlook (expect 24% PAT CAGR over FY21-FY24E), high RoE of 30% and robust FCF justified premium valuation,” the brokerage has said.

Risks for Gujarat Gas stock

Risks for Gujarat Gas stock

Sharekhan also sees the lower-than-expected gas sales volume in case of COVID-19 led economic slowdown as one of the risks. “A delay in development of new GAs, a sharp rise in LNG prices and adverse regulatory changes could impact outlook and valuations,” the brokerage has said.

2021-22 2022-23
Revenue Rs 13,956 crores Rs 16,425 crores
OPM 17.40% 18.00%
Price to earnings 33.8 27
Price to book 9.3 7.4

Disclaimer

Disclaimer

Investing in stocks poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies Pvt Ltd, the author, and the brokerage houses are not liable for any losses caused as a result of decisions based on the article. Investors should take care because the markets have hit record peaks in the last few days.



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ICICI Securities Is Betting On These 3 Stocks For Impressive Gains

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Buy Elgi Equipments, Says ICICI Securities

The brokerage is optimistic on the stock of air compressor major Elgi Equipments. The firm has set a price target of Rs 260 on the stock, as against the current market price of Rs 203.

According to ICICI Securities, long-term incremental growth will be driven by rapid growth in international markets, new products such as innovative AB series compressors, and traction in the India business. Double-digit return ratios, net debt-free b/s, and excellent cash generation.

Elgi’s share price has grown by ~2.2x over the past five years (from Rs65 in March 2016 to Rs 205 levels in March 2021).  Considering strong growth outlook, better margins, we maintain BUY rating Target Price and Valuation: We value Elgi at Rs 260 i.e. 42x P/E on FY23E EPS.

We also like Grindwell Norton in our coverage. Margin expansion (from ~16.7% in FY20 to 20.6% in FY23E) .BUY with a target price of Rs 151,” the brokerage has said.

Current Market Price Rs 203
Target Price Rs 260
Upside Potential 28%

Buy Gabriel India for an upside of Rs 160

Buy Gabriel India for an upside of Rs 160

According to the brokerage firm, Gabriel India (GIL) is a top-10 global shock absorber producer that caters to the 2-W, 3-W, PV, CV, railway, and aftermarket markets.

“The stock price has grown at modest ~3% CAGR from Rs 115 levels (August 2016), having done slightly better than Nifty Auto index. We retain BUY rating on mix & margin gains and large EV opportunity Target Price and Valuation: We value GIL at 20x P/E on FY23E basis for a revised target price of Rs 160 per share (earlier target price Rs150).

Margin improvement to 8.5 percent by FY23E will be aided by lower breakeven levels, cost focus, and a bigger percentage of aftermarket and exports from present levels. Net cash b/s (Rs 250 crore in cash and liquid investments); 14% of market capitalization,” the brokergae has said.

Apart from GIL, we favor JK Tyre for auto auxiliary coverage. When it comes to b/s deleveraging, asset sweating, and capital efficiency, BUY with a target price of Rs 180, the brokerage added.

Current Market Price Rs 128
Target Price Rs 160
Upside Potential 25%

Buy Indian Oil Corporation, Says ICICI Securities

Buy Indian Oil Corporation, Says ICICI Securities

According to ICICI Securities, higher costs were passed on to customers, the marketing segment’s performance improved QoQ. GRMs were recorded at US$6.6/bbl, down from US$10.6/bbl QoQ due to larger inventory gains in Q4FY21. EBITDA was Rs 11,126.1 crore, down 17.6 percent from the previous quarter.

“IOC’s refining margins are expected to improve gradually with an improvement in product cracks. Steady marketing margins and better sales with relaxations in lockdown are expected to lead to better profitability. We upgrade our rating from HOLD to BUY on the stock. Target Price and Valuation: We value IOC at Rs 120 i.e. average of P/E multiple: Rs 115 /share and P/BV multiple: Rs 125/share.

Apart from IOC, we prefer MGL in our oil and gas coverage because it benefits from India’s growing gas demand and will continue to rise due to consistent volume growth, stronger pricing power, and a favourable regulatory environment. BUY with a target price of Rs 1,340, the brokerage has said.

Current Market Price Rs 104
Target Price Rs 120
Upside Potential 15%

Disclaimer

Disclaimer

Investing in stocks poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article. Investors should take care because the markets are near record highs.



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Our provision numbers will fall to just 2% of advances eventually: V Vaidyanathan, CEO, IDFC First Bank

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Another reason also is that we are doing prime home loans, which has hardly any delinquency. Don’t go by this quarter provisions, we recognised early because of the nature of our stiff provisioning policy.

IDFC First Bank expects the government to prevent a duopoly in the telecom sector, MD & CEO V Vaidyanathan tells Shritama Bose. The lender expects its credit costs to taper off over the years, he says. Edited excerpts:

Loan growth has been anaemic for the whole industry for a while now at 5-6% levels. You have grown at 9%. What is driving that?

The main thing is that we’ve started home loans, and that was the biggest driver of growth. A quarter ago, we brought down the interest rate on savings accounts from 6% to peak rate of 5%. Therefore, we have suddenly become competitive in the prime home loan segment.

Q1 was a difficult quarter for collections. Are you seeing a pullback thereafter?

After mid-June, we have been seeing a sharp recovery in the collections. In pre-Covid February 2020, the collection level was 98.8% and in July 2021 collections in the early bucket have risen to 99.4% … That is why we are guiding that our provision numbers will be coming down to just 2% of the advances going forward, below pre-Covid levels, which would be pretty good. Another reason also is that we are doing prime home loans, which has hardly any delinquency. Don’t go by this quarter provisions, we recognised early because of the nature of our stiff provisioning policy.

Retail distress has risen in Q1 mainly because of lower collections. Could the distress be more entrenched for some households?

No. If that were the case, how could our early or current bucket collections have come back to the 99.4% level after the Covid second wave? The cash flows of customers were affected, once their cash flows came back, they began to honour the instalments.

There is concern around a telecom company which is not stressed, but has sent out rescue calls to the government. How are you dealing with that exposure?

We believe the government will try to work out some solution to keep it a viable industry and it won’t become a duopoly for India’s sake. We were transparent about this account, we identified it early, and have a provision of Rs 487 crore on this account already. Our capital adequacy is already 15.6%. So, theoretically, just to simulate, even if we charge the entire 100% on the funded exposure of Rs 2,000 crore, our capital adequacy will still be very strong at around 14.7%. Not that we intend to do that, but just to simulate, even if it did get there, we are prepared. We have a very profitable incremental business. One day all these issues will become history.

What is the profitability outlook?

We have been profitable for the last five quarters. Last quarter, we hit the highest ever core pre provisioning operating profit of Rs 601 crore in the history of the bank, which is more than double since the merger. This despite adding 400 branches, 600 ATMs, hiring 12,000 employees, launching credit cards, salary accounts, fast tags, Fleet cards, building the technology layer, and growing Rs 50,000 crore of retail liabilities … So obviously, the incremental lending is very profitable, which is buffering these investments in liabilities. As the past issues go away, you will see it more in the profits line.

But there have been too many issues in infrastructure?

Yes, that’s the nature of any infra DFI (development finance institution). Whether Dewan, Reliance Infra or this telecom, they are all legacy businesses. Not a single new corporate account booked post-merger is even in SMA1 in the last two-and-a-half years.

This conversion from the DFI has taken too long.

You ask Mr. (KV) Kamath how hard it is. He is the only other person that I know who has converted a DFI to a bank. By the time you raise new low-cost retail liabilities, replace the high-cost liabilities and run off old loans, it takes years, and meanwhile it drags profit down. Even today, we are carrying Rs 27,500 crore of infrastructure and other past borrowings where we are paying 8.6%, which we will replace with sub-5% and save about Rs 1,000 crore a year. That’s why it takes time. But once done, this will be an amazing institution. All issues, whether infra or the telecom, will go away today or tomorrow.

One of the options being floated is that banks take over the company.

We are not even thinking along those lines. We are holding bonds. We have dealt with many things in our life, we will deal with this situation also.

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5 High Rated & Top Performing Small-Cap Funds To Plan SIP In 2021

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Quant Small Cap Fund Direct Plan Growth

Quant Small Cap Fund Direct Plan-Growth is a Small Cap mutual fund of its category that was founded by Quant Mutual Fund in 2013 and has been in operation for the past eight years. According to the data of Value Research, the past year’s growth returns were 150.73 percent of this fund. It has returned an average of 17.10 percent every year since its inception.

The healthcare, FMCG, Chemicals, Construction, and Metals sectors account for the majority of the fund’s sector allocation. India Cements Ltd., Indiabulls Real Estate Ltd., EID-Parry (India) Ltd., Fortis Healthcare (India) Ltd., and Shree Renuka Sugars Ltd. are the fund’s top five holdings. The fund currently has an asset under management (AUM) of Rs Rs 700.52 Cr and the latest Net Asset Value (NAV) as of 04.08.2021 is Rs 132.15.

Nippon India Small Cap Fund Direct Growth

Nippon India Small Cap Fund Direct Growth

Nippon India Small Cap Fund Direct-Growth is a medium-sized small-cap fund. The fund was established in 2013 by the fund company Nippon India Mutual Fund and has been in operation for the past eight years. Nippon India Small Cap Fund Direct-Growth gains in the previous year were 110.64 percent, according to Value Research. It has returned an average of 26.62 percent every year since its inception.

Engineering, Chemicals, FMCG, Technology, and Services make up the majority of the fund’s sector allocation. Deepak Nitrite Ltd., Navin Fluorine International Ltd., TI Financial Holdings Ltd., Balrampur Chini Mills Ltd., and Birla Corporation Ltd. are the fund’s top five holdings. Currently, the fund has an asset under management (AUM) of Rs 15,353.12 Cr, and the latest NAV as of 4 August 2021 is Rs 83.71.

Kotak Small Cap Fund Direct Growth

Kotak Small Cap Fund Direct Growth

Kotak Small Cap Fund Direct-Growth is a medium-sized small-cap fund. The fund was founded in 2013 by the fund house Kotak Mahindra Mutual Fund and has been in operation for the past eight years. Kotak Small Cap Fund Direct-Growth returns in the previous year were 120.09 percent, according to Value Research. It has returned an average of 21.99 percent per year since its inception. Chemicals, Consumer Durable, Metals, FMCG, and Construction make up the majority of the fund’s sector allocation.

Century Plyboards (India) Ltd., Sheela Foam Ltd., Carborundum Universal Ltd., Persistent Systems Ltd., and Lux Industries Ltd. are the fund’s top five holdings. The fund currently has Rs 4,765.50 Cr in assets under management (AUM) and a NAV of Rs 168.37 as of 4 August 2021.

BOI Axa Small Cap Fund Direct Growth

BOI Axa Small Cap Fund Direct Growth

BOI AXA Small Cap Fund Direct-Growth is a Small Cap mutual fund scheme that was introduced by BOI AXA Mutual Fund in the year 2018 and has been in operation for the last two years. According to Value Research, the BOI AXA Small Cap Fund Direct has a 1-year growth return of 108.49 percent. It has generated an average yearly return of 42.72 percent since its inception.

Central Depository Services (India) Ltd., Laurus Labs Ltd., Sequent Scientific Ltd., Firstsource Solutions Ltd., and KPIT Technologies Ltd. are the fund’s top five holdings. The fund has equity sector allocation across chemicals, financial, technology, healthcare, FMCG, services, and construction. As of 4 August 2021, the fund has Rs 158.22 Cr in assets under management (AUM) and a latest NAV of Rs 25.29.

Canara Robeco Small Cap Fund Direct Growth

Canara Robeco Small Cap Fund Direct Growth

Canara Robeco Small Cap Fund Direct-Growth is a medium-sized small-cap fund. This fund has been around for two years and six months, having been established in the year 2019. Canara Robeco Small Cap Fund Direct-Growth had a 1-year return of 103.71 percent, according to Value Research. Since its inception, it has generated an average of 36.18 percent annual returns. The fund has its equity sector allocation across financial, construction, services, chemicals, and engineering.

FAG Bearings India Ltd., Grindwell Norton Ltd., Essel Propack Ltd., KNR Constructions Ltd., and Computer Age Management Services Ltd. are the fund’s top five holdings. The fund’s expense ratio is 0.79 percent, which is comparable to the expense ratios charged by most other funds in the same category. As of 4 August 2021, the fund has Rs 1,241.52 Cr in assets under management (AUM) and a NAV of Rs 21.43.

Best Performing Small Cap Funds In 2021

Best Performing Small Cap Funds In 2021

Here are the top-performing small-cap funds in 2021, in terms of past 1 year returns and performance.

Fund 1-Year Returns 3-Year Returns 5-Year Returns Rating by Morningstar Rating by Value Research
Quant Small Cap Fund Direct Plan-Growth 150.73% 36.35% 22.83% 4 star NA
Nippon India Small Cap Fund Direct-Growth 110.64% 22.75% 23.95% 4 star 4 star
Kotak Small Cap Fund Direct-Growth 120.09% 27.65% 22.00% 4 star 4 star
BOI Axa Small Cap Fund Direct-Growth 108.49% NA NA NA NA
Canara Robeco Small Cap Fund Direct-Growth 103.71% NA NA NA NA

Disclaimer

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The views and investment tips expressed by authors or employees of Greynium Information Technologies, should not be construed as investment advise to buy or sell stocks, gold, currency or other commodities. Investors should certainly not take any trading and investment decision based only on information discussed on GoodReturns.in We are not a qualified financial advisor and any information herein is not investment advice. It is informational in nature. All readers and investors should note that neither Greynium nor the author of the articles, would be responsible for any decision taken based on these articles. Please do consult a professional advisor. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and authors do not accept culpability for losses and/or damages arising based on information in GoodReturns.in



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3 Cheap Private Sector Banking Stocks To Buy In Terms Of 10-Year P/E Averages

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Here are 3 cheap private sector bank stocks that are at a discount

Current price to earnings 10-year average p/e Discount
Axis Bank 14.1 37.5 -62
Bandhan Bank 13.7 24.9 -45.00%
RBL Bank 10.4 30 -65.00%

(Courtesy: Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services )

The table above shows that the stock of RBL Bank is available at a huge discount compared to long-term averages. However, that does not make the stock a buy, given that there are issues relating to NPAs and provisions. Therefore, just because the stock is available at a discount it does not automatically qualify to be picked for investment.

“Large Private Banks are carrying an additional COVID-19 provisions buffer, which should limit the impact on credit cost. We continue to prefer ICICI Bank, Axis Bank and HDFC Bank,” Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services says.

Axis Bank could be a great stock to buy?

Axis Bank could be a great stock to buy?

Axis Bank is among the top picks of brokerage firms. In fact, there are no reasons why it should trade so low and at such a discount. In fact, the price to book value for the stock is also just 1.7 times.

“Most Private Banks reported higher slippages, primarily led by the Retail and MSME segment. Gross Non Performing ratio across private banks has increased. The recovery momentum is healthy, with collection efficiencies showing a strong improvement over Jun-Jul’21. This should lead to a moderation in the slippage run-rate, mainly from 2HFY22. However, provision coverage remains healthy,” Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services says.

According to the handbook, disbursements fell sequentially across most Retail segments, while a few Banks reported a recovery in Corporate loan growth. “Large Private Banks are well-placed to accelerate market share gains, given their strong capital positions, robust balance sheets, and higher provisioning coverage on stressed assets,” Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services says.

Some PSU bank stocks are going cheap

Some PSU bank stocks are going cheap

Some government owned banks are also available at a discount to long-term averages. Several brokerages like the stock of Indian Bank, which is available at a very low p/e multiple and also at a discount.

Current price to earnings 10-year average p/e Discount
Indian Bank 14.1 37.5 -62

(Courtesy: Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services )

“PSU Banks are trading at a P/B of 1.1 times, near their historical average of 1 times. Overall, most public sector banks are trading at reasonable valuations, with an improving earnings outlook,” Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services says.

Disclaimer

Disclaimer

Investing in stocks poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article. Investors should take precaution because the markets are near record highs.



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New crypto threatens to dethrone Ethereum after its latest upgrade, BFSI News, ET BFSI

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New Delhi: A fresh update on the Ethereum blockchain has provided fresh ammunition to a new cryptocurrency, Solana, to challenge the former – a more popular and established token – and take its place of pride.

The new update, called ‘London Hard Fork’, on the Ethereum blockchain includes five Ethereum improvement proposals (EIPs). The exact date of its release could not ascertained.

There was no limit on Ethereum mining so far. Miners used to be rewarded with brand-new coins every time they validated a block and were compensated with the transaction fees paid by users. ‘London Hard Fork’ aims to fix this, and says miners will no longer receive transaction fees.

This upgrade will most certainly enhance the Ethereum blockchain, and the way in which the asset is priced, as supplies will become limited. It will increase the transaction speed per second, leading to less congestion and significantly reduced fees.

On the contrary, miners will be affected, as it will burn a portion of the fees generated on the blockchain, which will in turn reduce their revenue and may prompt some of them to go for possible migration.

“Solana would be a key beneficiary of a possible migration, if there is any, as it can process transactions at a much faster pace even after the updated Ethereum,” said Nirmal Ranga, Vice President (Trading), ZebPay. “Solana is favoured due its fast, secure and censorship-resistant blockchain that provides an open infrastructure.”

Crypto experts said Solana is not the only prominent successor, as it faces fierce competition from the likes of Algorand, Cardano, Tezos and Polkadot, and a few others. A prudent approach is to assess the token on its own fundamentals and strength.

Solana, launched in April 2020, is a relatively nascent cryptocurrency. It has gained a lot of attraction, bragging about its scalable technology. The USP of this crypto is the huge transaction speeds on its blockchain network at dirt-cheap fees, experts said.

The recent sensation of the crypto world has surged over 4,500 per cent since its inception. In 2021 so far, the digital token has delivered over 2,200 per cent return. Currently, the token is trading at $34.5, about 40 per cent below its peak value hit in May 2021.

“Solana is not the usual ‘pump and dump’ crypto, but more of a platform that can be used to build several applications. Decentralised apps — also known as DApps — are built on these blockchain networks,” said Edul Patel, CEO & Co-founder, Mudrex.

One of the most significant competitors to the Ethereum network is Solana. The transaction speed and scalability of the Solana network are what set it apart from a lot of other cryptos, Patel said.

In terms of scalability, the Solana network can handle more than 50,000 transactions per second. Also, it is more cost efficient, which is adding to its traction.

Some people drew comparisons between Solana and Internet Computers (ICP), but the recent crash in prices in ICP and the buzz about major dumping by the founders made several ICP investors unhappy. Thus, many people moved to Solana.

Hitesh Malviya, crypto guru and founder of itsblockchain.com said the Solana ecosystem introduces a number of new, efficient technologies that cooperate so as to enable the Solana blockchain to facilitate greater transaction speeds and a highly secure platform.

“This fund will supercharge the building of the DeFi ecosystem on the back of the Solana blockchain,” said Ranga of ZebPay. “It can be anticipated that this fundraising will help the token to climb higher on the ladder.”

The fundraising has already had its impact on the price of the native token. The volume of Solana has risen by almost 150% in just six months.

Differences with Ethereum
Solana and Ethereum cater to different audiences of the blockchain. Ethereum is a community-run technology-powered cryptocurrency, whereas Solana is for those who are interested in a fast, secure and censorship-resistant blockchain providing the open infrastructure required for global adoption.

Even though Solana is achieving great heights, Ethereum has the first mover advantage of sorts, given its reach and legacy.

Solana does not support integration with Binance smart chain, Meta mask, Rarible and other services. There are about 88 softwares that integrate with ethereum. Transaction per second and cost efficiency are the other differences between the two challengers.

Who emerges victorious?
Solana is a key challenge to Ethereum’s throne, as the former has the potential to make some big plays and become the preferred blockchain among DeFi applications and NFT offerings.

However, these are early days for Solana. “Developers might be struggling over the Solana, but for investors looking to build wealth in the crypto space, the token price needs to go up,” said Patel of Mudrex.

Despite the technological superiority, Solana’s adoption is lagging far behind Ethereum, even when the latter has been facing issues with network congestion, high transaction fees and is struggling to meet booming demand for DeFi products.

Solana does away with the scalability issues that most existing blockchain platforms suffer from, said Malviya of itsblockchain.com. “The Solana ecosystem has made great progress towards achieving interoperability, and it is already connected to the Ethereum ecosystem through the Wormhole bridge, which allows users to do intratrade,” he said.

“Yet, it would very difficult for Solana to replace Ethereum, mainly because Ethereum has a better hold on the market, thanks to its early entry and eventually having very high brand recognition. Solana, no doubt, has better technology, but it takes time for people to adopt new technology,” said Ranga of Zebpay.



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Polkadot, Uniswap, Ethereum gain up to 9%, BFSI News, ET BFSI

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New Delhi: After a brief pause for a couple of days, major cryptocurrencies were back on the gaining track on Thursday. Barring dollar pegged tokens, all constituents of top 10 digital tokens were trading higher at 9.30 hours IST. Polkadot, Uniswap and Ethereum led the gainers.

The global crypto market cap declined to $1.62 trillion, about 4 per cent higher compared to the last day. However, the total crypto market volume increased 8 per cent to $81.43 billion.

On the derivatives side, data suggests that Bitcoin whales have further added to their leveraged positions, as the Bitcoin price topped out at $42,600. Top traders across major exchanges capitalized on the opportunity and added leverage-long positions, which is very much a bullish indicator.

“Despite the dip in Bitcoin, optimism amongst the crypto community is still strong. The sentiment seems positive, as even at higher levels, we have witnessed buyers buying in, and not exiting their positions. This is also supported by a good on-chain metric, which indicates that activity has increased, which is also a bullish sign,” said ZebPay Trade Desk.

Post the London fork if the much anticipated ETH rally does set in, we can see ETH dominance move upward too. Even though Ethereum’s market capitalization is just 19% of the entire crypto market, its utilization in decentralized finance (DeFi) makes it a force to be reckoned with, it added.

RIT Capital Partners, the investment trust founded by Jacob Rothschild, is co-leading a funding round for crypto investment platform Aspen Digital intended to finance the creation of an online platform that would give wealthy investors a single portal to manage crypto investments.

Bitbns, an India-based cryptocurrency exchange, has offered to open a systematic investment plan in cryptocurrencies like Bitcoin and Ethereum for India’s medal winners Mirabai Chanu and PV Sindhu after they won silver and bronze medals, respectively, at the Tokyo Olympics.


Tech View by Giottus Cryptocurrency Exchange
Issued by the global exchange Binance, the Binance coin (BNB) was initially launched on the Ethereum blockchain before migrating to Binance’s own smart chain. It works as a utility token, with discounted trade on Binance, as a tool to invest in Initial Coin Offerings (ICO) on its Launchpad program, and is accepted as payment in certain service providers.

After a rally to around $700 in May this year, BNB formed a series of lower lows for weeks, eventually dropping to about $250. That Binance has been subject to regulatory hurdles in multiple territories recently hasn’t helped its cause. However, with increasing crypto adoption and volume, demand for BNB is increasing once again.

BNB bounced off an important trendline support yesterday, its 50-day EMA, signaling a bullish move ahead. This support acts as a lower trendline for both ascending channel and ascending wedge formation. BNB needs to break and stay above trendline resistance levels at $347 and $363, while enjoying support on lower levels at $317 and $305.

BNB seems to be in the accumulation zone in the daily time frame while attempting to break out of the $342-$363 resistance zone. A daily close above this zone can generate a strong bullish confirmation, while a close below the trendline will provide a bearish outlook that could possibly send BNB to below its recent bottom.

Major Levels
Support: $301, $252, $223
Resistance: $363, $410, $453

Time is in UTC and the daily time frame is 12:00 AM – 12: 00 PM UTC

(Views and recommendations given in this section are the analysts’ own and do not represent those of ETMarkets.com. Please consult your financial adviser before taking any position in the asset/s mentioned.)



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Top 5 Public Sector Banks Promising Best Interest Rates On FD In 2021

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Investment

oi-Vipul Das

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A fixed deposit is among the finest debt instruments offered by banks, offering a variety of advantages such as risk-free interest rates, guaranteed returns, tax benefits, deposit safety, flexible tenure, and additional interest rates for senior citizens, among others. Fixed deposit instruments, as opposed to equities, mutual funds, or other market-linked instruments, are the best short- and long-term investments since they are not market-driven. By taking into account all of these variables, we’ve prepared a list of the top 5 public sector or government banks that are currently giving the best interest rates in the market to both regular and senior citizens.

Union Bank of India

Union Bank of India

For a deposit amount of less than Rs 2 Cr, Union Bank is offering the following interest rates to both regular and senior citizens.

Period Regular FD Rates Senior Citizen FD Rates
7 – 14 Days 3.00% 3.50%
15 – 30 Days 3.00% 3.50%
31 – 45 Days 3.00% 3.50%
46 – 90 Days 3.50% 4.00%
91 – 120 Days 3.75% 4.25%
121 to 180 Days 4.30% 4.80%
181 Days to less than 1 Year 4.40% 4.90%
1 Year 5.00% 5.50%
More than 1 Year to 2 Years 5.20% 5.70%
More than 2 Year to 3 Years 5.40% 5.90%
Mor than 3 Years to 5 Years 5.50% 6.00%
More than 5 Years to 10 Years 5.60% 6.10%
Source: Bank Website, W.e.f. 09/07/2021

Canara Bank

Canara Bank

With effect from 08.02.2021, Canara Bank is promising the following interest rates on fixed deposits of less than Rs 2 Cr. The Canara Tax Saver Deposit scheme is offered by the bank at a rate of 5.50 percent per annum to the general public. The maximum deposit that can be made is Rs 1.50 lakh to enjoy tax benefits.

Tenure Regular FD Rates In % Senior Citizen FD Rates In %
7 days to 45 days 2.95 2.95
46 days to 90 days 3.90 3.90
91 days to 179 days 4.00 4.00
180 days to less than 1 Year 4.45 4.95
1 year only 5.20 5.70
Above 1 year to less than 2 years 5.20 5.70
2 years & above to less than 3 years 5.40 5.90
3 years & above to less than 5 years 5.50 6.00
5 years & above to 10 Years 5.50 6.00
Source: Bank Website

State Bank of India

State Bank of India

The country’s largest lender State Bank of India (SBI) is promising the following interest rates to both regular and senior citizens on a deposit amount of less than Rs 2 Cr.

Period Regular FD Rates Senior Citizen FD Rates
7 days to 45 days 2.90 3.40
46 days to 179 days 3.90 4.40
180 days to 210 days 4.40 4.90
211 days to less than 1 year 4.40 4.90
1 year to less than 2 year 5.00 5.50
2 years to less than 3 years 5.10 5.60
3 years to less than 5 years 5.30 5.80
5 years and up to 10 years 5.40 6.20
Source: Bank Website, W.e.f. 08.01.2021

Punjab & Sind Bank

Punjab & Sind Bank

The interest rates on domestic term deposits and NRO accounts offered by Punjab and Sind Bank are listed below. Senior citizens would receive an additional 0.50 percent interest rate on term deposits of less than Rs. 2 Crore, over and above the specified rates, for maturities of 180 days and above for new and renewal of fixed deposit accounts.

Period Regular FD Rates Senior Citizen FD Rates
7 – 14 Days 3.00 3.50
15 – 30 Days 3.00 3.50
31 – 45 Days 3.00 3.50
46 – 90 Days 3.70 4.20
91 – 120 Days 4.05 4.55
121-150 Days 4.05 4.55
151 – 179 Days 4.05 4.55
180 – 269 Days 4.45 4.95
270 – 364 Days 4.50 5.00
1 Year – 2 Years 5.15 5.65
Above 2 Year to less than 3 Years 5.15 5.65
3 Years – 5 Years 5.30 5.80
More than 5 Year – 10 Years 5.30 5.80
Source: Bank Website, W.e.f. 16/05/2021

IDBI Bank

IDBI Bank

The applicable interest rates on resident term deposit / NRO of less than Rs. 2 Crore are listed below.

Period Regular FD Rates Senior Citizen FD Rates
07-14 days 2.70 3.20
15-30 days 2.70 3.20
31-45 days 2.80 3.30
46- 60 days 3.00 3.50
61-90 days 3.00 3.50
91-6 months 3.50 4.00
6 months 1 day to 270 days 4.30 4.80
271 days upto 4.30 4.80
1 year 5.00 5.50
More than 1 year – 2 years 5.10 5.60
More than 2 years to less than 3 years 5.10 5.60
3 years to less than 5 years 5.30 5.80
5 years 5.25 5.75
More than 5 years – 7 years 5.25 5.75
More than 7 years – 10 years 5.25 5.75
More than 10 years – 20 years 4.80 5.30
Tax Saving FD (5 Years) 5.25 5.75
Source: Bank Website, W.e.f. July 14, 2021

Story first published: Thursday, August 5, 2021, 16:28 [IST]



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