BANKING stocks see-sawed this week on news that the government has instructed financial institutions to work on waiving interest repayment for recipients of loan moratoriums in the lower income category.
The proposed waiver would be for three months, starting October.
The news caught the market offguard, sending stocks lower.
But the targeted three-month interest repayment waiver would likely have a less significant impact on banks’ bottomline, analysts said.
While the move would cause a small dent in their earnings, analysts said that banking stocks are still on track for recovery in 2021.
The operating environment for banks was undeniably challenging in the second quarter with the spike in Covid-19 cases leading to the imposition of tighter lockdowns.
However, this did not stop banks from turning in strong core net profit (CNP) growth of 29.5% year-on-year (y-o-y) in the second quarter of 2021, the second consecutive quarter of 20% y-o-y CNP growth.
India cuts import taxes on palm oil
FACED with rising cost of edible oils, India has slashed import taxes on vegetable oils, including palm oil, effectively making it cheaper to buy from overseas producers such as Indonesia and Malaysia.
The base import tax on crude palm oil (CPO) has been reduced to 2.5% from 10% starting Sept 11, reports said.
This is the fourth time India has revised its import duties on edible oils this year.
The base import tax on refined grades of palm oil, soy bean oil, and sunflower oil has been cut from 37.5% to 32.5%.
According to the same notification, the agri-cess for CPO has been increased from 17.5% to 20%.
After the cuts, CPO, crude soy bean oil and crude sunflower oil imports will be subject to a total effective 24.75% tax.
India imported 1.75 million tonnes of palm oil from Malaysia in the first six months of 2021.
Pick your number
NUMBER forecast operators (NFOs) – of which listed companies include Berjaya Sports Toto Bhd and Magnum Bhd – reopened for business from Sept 14 after a three-and-a-half month closure since June 1 due to the Covid-19 pandemic.
The first draw was on Sept 15.
Analysts said that based on previous re-opening of outlets, NFO sales are expected to recover gradually at first and then swiftly rebound within a month.
Expect NFOs to still be in the red in the third quarter, but earnings recovery should be strong in the last quarter, with both companies expected to resume their quarterly dividend payouts.