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Around 66 per cent of the BSE 500 universe is in the red since October, with 71 stocks losing more than 25 per cent of their value.

The conflict between Russia and Ukraine and the subsequent market correction may appear to be a good opportunity for investors to nibble into these stocks. But market watchers are of the opinion that valuations are still expensive and there is no clear answer to whether the markets have turned attractive.

“Given India’s already stretched equity valuations and global headwinds, we believe the market may remain choppy and advise investors to wait for better entry opportunities and invest only upon large corrections,” said a recent note by Credit Suisse Wealth Management India.

Foreign portfolio investors (FPIs) remain uncomfortable with India’s valuation premium and have sold about $20 billion since October. Nevertheless, domestic institutional investors (DIIs) and retail investors have absorbed a significant portion of selling pressure, so far. The mammoth LIC initial public offering, expected over a few weeks, may also impact liquidity, leading to a further correction.

The benchmark indices have recouped losses over the last few sessions after a steep correction the week before and are down 3 per cent in the year to date.

The market may not be fully factoring in the longer-term impact of the rising interest rates and inflation. “The impact of the Russia-Ukraine war on global inflation, commodity prices, and supply chain can only be known over the next two quarters. And we are yet to figure out the impact of the rising interest rates and inflation in India,” said Deepak Jasani, head-retail, HDFC Securities.

FMCG companies in India, for instance, have already effected price hikes of 10-25 per cent across categories, such as soaps, shampoos, paints, biscuits and edible oil in FY22.

The ongoing crude and commodities shock in the wake of the Russia-Ukraine conflict is likely to have negative implications for India’s macro situation in terms of higher inflation and bond yields, higher current account deficit, weaker INR, and potentially weaker consumer demand, and thus a lower GDP growth rate.

Some market watchers believe that the recent correction in the market has made valuations more palatable. At 18.1x currently, the Nifty index valuation appears to be expensive relative to the 20-year average of 16.1x and reasonable versus the 10-year average of 18.5x, according to Emkay’s India strategy report. The Nifty composition has changed towards higher P/E (growth) stocks, which makes recent averages more relevant, it said.

“Several stocks have corrected 25-50 per cent from their peak over the past 4-5 months. The conflict between Russia and Ukraine poses a near-term headwind but there is scope for bottom-up investing in the mid- and small-cap segments,” said Sachin Shah, Fund Manager, Emkay Investment Managers.

Kotak Institutional Equities says it finds reasonable reward/risk balance in sectors, such as banks and diversified financials, capital goods, real estate and specialty chemicals, while valuations of most ‘growth’ stocks remain rich.

Also Read |  World Consumer Rights Day │ Fintech firms must examine robustness of their tech platforms

The advent of numerous fintech companies on the horizon is a great advertisement of the enormous business opportunities that India provides, and can, also significantly advance the cause of financial inclusion in the country.

As we observe World Consumer Rights Day 2022 on March 15, for which  ‘Fair Digital Finance’ has been chosen as the theme, it would thus be fitting if the occasion could lead to a relook by fintech companies at their technology platforms and algorithmic models to find out how these may be improved to better serve customer interests.

At a time when a large quantum of transactions is being done digitally, technology vulnerability of fintech companies, especially their inability to adequately safeguard customer data, could have adverse connotations not just for the specific entities and their clients, but the entire financial sector. The cumulative value of digital transactions in India surged from Rs 15,887.88 crore in April 2021 to Rs 23,099.34 crore in February.

In April, a World Bank Group Policy Research Paper titled ‘Consumer Risks in Fintech – New Manifestations of Consumer Risks and Emerging Regulatory Approaches’ had also emphasised this fact by stating: “Platform or other technology malfunctions can have adverse impacts on consumers ranging from inconvenience and poor service to monetary loss and loss of data integrity, the risk of which may be increased due to heavier reliance on automated processing of transactions”.

Making the algorithmic process fairer could ensure that it is not being discriminatory towards any demography, socio-economic category, and place of stay of likely customers. More importantly, a periodic review of the algorithms used could prove handy in determining whether these are in line with international best practices, and appropriately factors in the India context.

The 2,000-plus fintech companies operating in India — the overwhelming majority of which have come up in the last five years — could also examine whether their governance models and existing systems and processes are robust enough to handle rapid growth, while not compromising with the quality of service they provide to customers.

Embarking on such an exercise could benefit the fintech segment overall in terms of being able to identify and address the likely pain points that may emerge in future through an unbridled rise in transaction numbers. An initiative of this kind could also make the sector more resilient through the introduction of upgraded systems and processes, including the way it meets its manpower requirements and trains employees for their assigned jobs.

From an individual fintech company’s perspective, the gains from such efforts could be in the form of becoming more sustainable, an increase in its customer-centricity, and a rise in its attractiveness among potential investors. All these combined could help a company stand out from its peers in a market that is increasingly getting commoditised.

Given the importance of the financial sector in the economy, authorities, too, may consider stepping up their vigil to ensure that fintech startups are not overreaching themselves to achieve ‘unicorn’ status at the earliest and, also, not luring customers with lofty promises that they may find difficult to meet later. Authorities taking a closer look at how the fintech companies are going about their jobs could lead to the long-term sustainability of the sector by ensuring that its operations remain within a defined rule-bound framework. Moreover, it would reduce the likelihood of some fintech firms trying to play fast and lose to earn more money in the quickest possible time.

Significantly, it would further increase the faith of ordinary people in fintech companies as authorities could nudge fintech companies to provide more information on customer grievance handling processes, including likely turnaround times to settle complaints.

There is little chance of some level of pro-activism shown by authorities to protect customer interests coming in the way of the growth of the Indian fintech sector, including overseas investment flows into this arena. No progressive fintech company or likely investor would mind that as they too realise that for authorities anywhere citizen interests would always come ahead of everything else.

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Biological E's Corbevax will be administered to 12-15 years age-group.

The National Technical Advisory Group on Immunization (NTAGI) is learnt to have given its recommendation to begin vaccination of children in the 12-15 years age group.

"The vaccination of children in the age group of 12 -15 years is most likely to begin from Tuesday. Also, the co-morbidity clause for administering precaution doses to those aged 60 years and above would be removed," an official source said.

he countrywide vaccination drive was rolled out on January 16 last year with healthcare workers (HCWs) getting inoculated in the first phase. The vaccination of frontline workers (FLWs) started from February 2 last year.

The Centre is likely to begin the Covid vaccination for children in the age group of 12 -15 years this week, while the co-morbidity clause for administering precaution doses to senior citizens would be removed, official sources said on Monday.

Biological E's Corbevax will be administered to 12-15 years age-group.

The National Technical Advisory Group on Immunization (NTAGI) is learnt to have given its recommendation to begin vaccination of children in the 12-15 years age group.

"The vaccination of children in the age group of 12 -15 years is most likely to begin from Tuesday. Also, the co-morbidity clause for administering precaution doses to those aged 60 years and above would be removed," an official source said.

The countrywide vaccination drive was rolled out on January 16 last year with healthcare workers (HCWs) getting inoculated in the first phase. The vaccination of frontline workers (FLWs) started from February 2 last year.

The next phase of COVID-19 vaccination commenced from March 1 for people over 60 years of age and those aged 45 and above with specified co-morbid conditions.

The country launched vaccination for all aged more than 45 years from April 1, 2021.

The government then decided to expand its vaccination drive by allowing everyone above 18 to be vaccinated from May 1 last year.

The next phase of COVID-19 vaccination commenced from January 3 for adolescents in the age group of 15-18 years.

India began administering precaution dosez of COVID-19 vaccine to healthcare workers, frontline workers, including personnel deployed for election duty and those aged 60 and above with co-morbidities, from January 10 this year amid a spike in coronavirus infections fuelled by Omicron variant of the virus in the country.

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The Employees’ Provident Fund Organisation (EPFO) on Saturday decided to pay 8.1 percent rate of interest on provident fund deposits for the current financial year 2021-22.

This is lowest in over one decade and likely to dissapoint over 60 million of its salaried class subscribers.

“The central board has declared 8.1 percent interest rate keeping in view and taking into account its income of Rs. 76,768 crore,” a CBT member said as the meeting is underway.

Last fiscal, this interest rate was 8.5 percent.

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(This is a developing story and will be updated soon)

Ahead of its initial public offering (IPO), Life Insurance Corporation’s (LIC) net profit surged to Rs 234.91 crore in September – December quarter (Q3FY22), owing to the change in surplus distribution model, wherein shareholders will now get a larger share of the surplus than earlier. In the same period last financial year, LIC’s net profit totaled Rs 0.91 crore. For the 9 months ended FY22 (April – December), net profit of the insurer stood at Rs 1,642.78 crore.

LIC had a single “life fund” before Section 24 of the LIC Act was amended by the government to bring its surplus distribution mechanism at par with private life insurers. Now, the life fund has been segregated into two funds – participating policyholders fund and non-participating policyholders’ fund. Consequently, the surplus distribution in the participating policyholders’ fund has been modified to 90:10 in a phased manner, wherein 90 per cent will go to policyholders and 10 per cent to shareholders. Further, 100 per cent of the surplus generated out of the non-participating business will be available for distribution to all shareholders.

This change, according to M R Kumar, chairman LIC, will help LIC increase its profitability, a metric that will be closely tracked once it gets listed. “Going forward, with the change in surplus distribution, profitability will increase. Beyond that, it’s a question of how the product mix changes, penetration, more coverage to people, getting into sectors where we have been missing out. So, that should take care of the profits,” Kumar had said.

Premiums of the insurance behemoth increased 0.8 per cent to Rs 97,761 crore in Q3FY22 from Rs 97,008 crore in the year-ago period. In the first 9 months of FY22 (9MFY22), premiums of the insurer, which includes first year premiums, renewal premiums, and single premiums, totaled to Rs 2.84 trillion, up 1.67 per cent year-on-year (YoY).

Persistency ratio of the insurer dipped in Q3FY22, with the thirteenth month persistency ratio at 69.23 per cent compared to 72.98 per cent in the same period a year ago. But the 61st month persistency inched higher than the year ago period to stand at 57.28 per cent. Persistency ratio is the ratio of life insurance policies receiving timely premiums in the year and the number of net active policies. The ratio indicates how many policyholders are paying the due premiums regularly on the policies with the insurer.

The solvency ratio -- a measurement of the entity’s ability to meet its debt obligations and other financial commitments – of the insurer improved to 1.77 as of December, 2021, compared to 1.64 in the same period last year. The minimum regulatory requirement is 1.5.

The non-performing assets (NPA) ratio also saw sharp improvement, with the NPA ratio at the end of Q3FY22 standing at 6.32 per cent compared to 7.78 per cent in the same period a year-ago. And, net NPA ratio improved to 0.04 per cent compared to 0.14 per cent in the same period.

LIC filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) on February 13, thus setting the ball in motion for the country’s largest-ever public listing. The government will sell 5 per cent of its stake, or 316.25 million shares of its over 6,325 million shares. The government owns 100 percent of LIC. Sebi has cleared the DRHP of the state-owned Life LIC. Following the market regulator’s nod to the IPO papers, the insurer can launch its share sale. However, LIC may not launch its IPO immediately given the current volatile market conditions.

The government is hoping to launch the IPO as soon as stock market volatility, sparked by the Russian invasion of Ukraine, recedes.

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India has been very good at managing its finances but the surge in global energy prices is going to have a negative impact on its economy, said Kristalina Georgieva, the Managing Director of the International Monetary Fund.

During a media roundtable on Thursday on the Russian invasion of Ukraine and its global impact, Gita Gopinath, who is the First Deputy Managing Director of the IMF, observed that the war has posed a challenge to economies around the world, including India.

"India relies heavily on energy imports and the price is going up. That has implications on the purchasing power of Indian households. "If you're looking at headline inflation numbers, inflation in India is close to around six per cent, which is the upper end of the inflation band for the Reserve Bank of India," Gopinath said.

This has implications on the monetary policy in the country and it is a challenge in many parts of the world, not just India, she said. Georgieva said, "Clearly the most significant channel of impact on the Indian economy is energy prices."

India is an importer and the increase in energy prices is going to have a negative impact, she said, adding, "India has been very good in managing its finances." She stressed that there are some fiscal spaces to be able to respond to the challenge.

"Our advice to our members is first and foremost make sure that you protect the most vulnerable populations from the shot up of prices, not only energy but also foot food prices for countries where this is going to be a significant factor," the IMF managing director said.

"Target your fiscal space to those that are in a grievous need to be supported. We would also be looking into monetary policy responses, as to how could they be calibrated appropriately to what is happening," Georgieva added.

Also Read | US steps up pressure on Russia for Ukraine war, calls for raising tariffs

The BJP raced towards a second straight win in politically crucial Uttar Pradesh and dominated the score chart in three other states while the Aam Aadmi Party announced its national presence with a landslide victory in Punjab, its triumph redrawing India's political map and diminishing the Congress even further.

As votes were counted on Thursday for elections to five states held over February and March, the possible four-one score for India's ruling party underscoring its political prowess. The BJP was also ahead in Uttarakhand, Manipur and Goa, according to trends and results on the Election Commission website.

The Congress' epitaph was written on the electoral battlefield. The party, now in power only in Rajasthan and Chhattisgarh, an all-time low, lost Punjab and was ahead in only two seats in Uttar Pradesh with a vote share of just 2.3 per cent -- notwithstanding the high-decibel campaign by the Gandhi siblings Rahul and Priyanka.

But all eyes were on key electoral battleground Uttar Pradesh where the Yogi Adityanath-led government was pitching for a second consecutive term in power.

In trends and results available for the 403 seats, the ruling party was ahead in 250 seats, short of its earlier count of 312 but comfortably over the halfway mark in polls that come a year after the devastating second Covid wave. This will be the first time in over three decades that a party will get re-elected for a second term in the state.

The Samajwadi Party, which made a vigorous bid for power with its leader Akhilesh Yadav attracting huge crowds at campaign rallies, was trailing with leads in 120 seats, a significant jump from the 47 last time. Enough to make it a vocal opposition but far removed from power even with the support of its allies, the RLD and the SBSP, which were ahead in 10 and four seats, respectively, analysts pointed out.

Adding to the saffron party's tally, BJP ally Apna Dal (Sonelal) was ahead in 12 seats. The BSP, which barely made a campaign splash, was leading in two seats with a vote share of 12.7 per cent.

The BJP was projected to have a vote share of 41.9 per cent and the SP 31.8 per cent in the prize state, which sends 80 MPs to the Lok Sabha and saw Prime Minister Narendra Modi and Home Minister Amit Shah among others campaigning intensively.

Applauding their party's win, BJP leaders, including Kailash Vijayvargiya and Sudhanshu Trivedi, said people have expressed their faith in the policies ushered in by Modi. Many of their party colleagues simply tweeted "Jai Shri Ram" to hail the trends.

Elections 2022, seen as a pointer to general elections two years away, were also the AAP's stepping stone out of Delhi. According to trends and results, the Arvind Kejriwal-led party was poised to win 92 of the 117 seats in Punjab, a three-fourths majority.

Incumbent Congress was a distant second with leads in 18 seats, preparing to cede power to a party that had so far only ruled Delhi. The Shiromani Akali Dal and the BJP lagged further behind with three and two respectively.

"First this revolution happened in Delhi, then in Punjab and it will now happen all over country," Kejriwal said at the party headquarters in Delhi.

"In the coming days, AAP will become a national force...the party will emerge as the national and natural replacement of Congress," party leader Raghav Chadha added while addressing workers at a rented accommodation of its chief ministerial candidate Bhagwant Mann in Sangrur.

The strong AAP wave in Punjab saw many bigwigs trailing and losing -- including SAD chief Sukhbir Singh Badal and Congress' Chief Minister Charanjit Singh Channi from both the seats he contested, Chamkaur Sahib and Bhadaur, former chief minister Amarinder Singh who left the Congress to join hands with the BJP and Punjab Congress president Navjot Singh Sidhu.

The trends reflected in the vote share too with the AAP at 42 per cent and the Congress at 22.9 per cent.

In the 2017 assembly polls in Punjab, the Congress had ended the SAD-BJP combine's run by bagging 77 seats out of the total 117-assembly segments in the state.

The AAP had managed to get 20 seats, while the SAD-BJP had won 18 seats.

"Humbly accept the people's verdict. Best wishes to those who have won the mandate. My gratitude to all Congress workers and volunteers for their hard work and dedication. We will learn from this and keep working for the interests of the people of India," former Congress president Rahul Gandhi said on Twitter

As the vote counting proceeded swiftly, BJP was in a dominant position in the other states too.

In the coastal state of Goa, the ruling party, set to score a hat-trick, was poised to win 20 of the 40 seats, just one short of the magic mark, while its nearest rival Congress was at 11. The Maharashtrawadi Gomantak Party was ahead in three seats and AAP in two. The Goa Forward Party was poised to nab one seat, while independents were ahead in three seats.

The picture in Uttarakhand was decisive. In leads and trends available for all 70 seats, the BJP was ahead in 48 and the Congress in 18, a huge gulf in a state where the 'grand old party' hoped to make an electoral dent.

Among the prominent candidates trailing in the hill state were Congress veteran Harish Rawat in Lalkuan. Interestingly, BJP's Chief Minister Pushkar Singh Dhami was also trailing in Khatima.

Counting in the northeastern state of Manipur was slower. In trends and results available for 46 of 60 seats, the BJP was ahead in 22 and the Congress in three. The National People's Party had leads in six seats and the Naga People's Front in five.

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Following Russia's invasion of Ukraine, crude oil prices have skyrocketed - in March alone, they have surged about 35% - which will in turn push up fuel, transport and other related components of inflation this month.

Inflation, as measured by the consumer price index (CPI), likely slipped to 5.93% in February on an annual basis, from 6.01% in January, the March 3-9 poll of 36 economists predicted.

Forecasts for the data, due for release on March 14 around 1200 GMT, ranged between 5.70% and 6.40%. Over one-quarter of respondents expected inflation to have remained above the RBI's 6.0% upper threshold.

"I'm expecting the headline moderation in February to be led primarily by the food and beverages component, where adjusted monthly gains have softened from their recent peaks," said Miguel Chanco, chief emerging Asia economist at Pantheon Macroeconomics.

"Storm clouds have been brewing for a while...the best way to describe the inflation numbers from around Q2 onwards is that when it rains, it pours."

Petrol prices at fuel stations, where Indians will feel the effect from higher crude oil prices most acutely, have barely moved but are overdue a rise in coming weeks.

"Sharp increase in prices post the announcement of election results and its pass-through to transportation costs would push inflation higher," said Kunal Kundu, India economist at Societe Generale, referring to elections across five Indian states over the past month including the most populous one, Uttar Pradesh.

Asia's third-largest economy expanded 5.4% in the October-December quarter, slower than the 6.0% predicted by economists in a separate Reuters poll.

Focusing on growth, not inflation, the Reserve Bank of India has held its interest rates steady at record lows for nearly two years but is due to increase borrowing costs next quarter.[ECILT/IN]

The latest poll also showed industrial output likely expanded 1.5% in January from a year ago, compared with 0.4% in December.