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Major Asian stock markets have opened the day on a positive note. The stock markets in Japan and Singapore are trading higher by 1.9% and 1.3% respectively. Benchmark indices in Europe and the US ended their previous session on a positive note with the stock market in Germany ending the day higher by 1.4%. The rupee is trading at 66.76 per US$.
Indian stock markets have opened the day on a firm note. The BSE Sensex is trading higher by 104 points (up 0.4%) and the NSE Nifty is trading higher by 30 points (up 0.3%). While BSE Mid Cap and BSE Small Cap are trading higher by 0.4% and 0.6% respectively.
As per an article in Livemint, the government has extended minimum import price (MIP) on 66 steel products for a period of two months ending 4 October. These 66 products include semi-finished products of iron or non-alloyed steel, flat-rolled products of different widths, bars and rods.
In order to protect the domestic manufacturers from cheap imports, the government in February had imposed a MIP on 173 products for a period of six months. Out of these 173 products initially covered, the government has extended the MIP on only 66 products this time.
Having said that, the government is planning to impose anti-dumping duty measures on products that aren't covered under the MIP extension.
The imposition of MIP has marginally improved the industry viability after a long period of subdued prices and eroded profit margins and will act as a boon to the domestic manufacturers of such products.
Marico reported its results for the quarter ended June 2016. The net profits of the company grew by 17.2% to Rs 2.6 billion during the quarter. The profits grew on the back of soft commodity prices and a recovery in the volumes of its core brands Safola and Parachute.
Volumes for Parachute and Safola grew by 7% and 11% during the quarter as compared to a year ago. However, the sales grew marginally by 0.6% YoY to Rs 17.5 billion during the quarter on the back of pricing pressures.
The recovery in the rural consumption will be a key driver for the growth of the company. Two years of deficit rainfall has dampened the rural wages and incomes, thus impacting discretionary spends and creating pricing pressures. The increasing threat from light hair oil category coupled with rural recovery will be the key things to watch out for going forward. The stock is trading up by 1.5%.
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