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India's Third Giant Leap

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Markets trade in the red
Fri, 24 Apr 01:30 pm

After opening in the green the Indian markets have remained below the dotted line in the morning session. Most sectoral indices are facing selling pressure. Consumer durables and realty stocks are leading the losers.

The BSE Sensex the trading down 162 points and the NSE-Nifty is trading down 57 points. The BSE Midcap index is trading down 1.2% and the BSE Smallcap index is trading down 1.8%. The Rupee is trading at 63.31 to the US dollar.

As per a leading financial daily, the Employee Provident Fund Organisation (EPFO) may invest up to Rs 900 bn in the stock markets. As per the recent changes in the fund's investment rules, the labour ministry has allowed up to 5-15% of the corpus to be invested in the equity markets. The EPFO corpus is around 6,000 bn. Currently the EPFO does not invest in the equity markets. The new rules are applicable from 01 April 2015. However, the EPFO will most probably begin investing via Exchange Traded Funds (ETFs) rather than investing directly. The inflows from the EPFO could significantly reduce the Indian market's dependence on FIIs.

As per a leading financial daily, leading FMCG firm Nestle India may keep up its focus on the premium segment to maintain margins. In 2014 the company had cut down on many products that it deemed to be low margin and low growth. This exercise may continue this year. However, the company will probably not end its commitment to launch new products, especially in the healthy category, as it believes there is significant growth potential in India. Brands such as Maggi, Kit Kat, Munch, Nescafe Milkmaid and Everyday did well for the company in 2014 and may not face the axe.

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