Manufacturing PMI up at 53.1 in Oct on new business orders, employment push

The country's manufacturing sector activity improved in October, as firms scaled up production and employment levels amid strong rise in new business order flows, a monthly survey said Thursday.
The Nikkei India Manufacturing Purchasing Managers' Index strengthened from 52.2 in September to 53.1 in October as new orders and production increased at the quickest rate in four months.

This is the 15th consecutive month that the manufacturing PMI remained above the 50-point mark. In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.
New orders increased at a sharp rate during October and panellists attributed this rise to successful advertising efforts, strengthening underlying demand and competitive price-setting. The rise in new order flows was the fastest since June.
"A combination of domestic and foreign orders fuelled the upturn in overall activity, although export orders displayed the slowest expansion since July, total new work rose at the sharpest pace since mid-year," said Pollyanna De Lima, Principal Economist at IHS Markit and author of the report.
Manufacturers stepped up hiring in October to meet rising demand conditions; and job-creation during the month was the strongest since last December.
ALSO READ: Manufacturing PMI rises to 52.2 in September on back of new orders
Notwithstanding that Indian manufacturers were confident that output will be higher over the course of the next year and they increased their marketing activity and investment in research and development, the level of optimism was stymied by concerns towards future market conditions.
"Goods producers see challenges and uncertainties ahead, which in turn translated into the weakest degree of optimism seen in 20 months," Lima said.
On the price front, there was upward inflationary pressure amid reports of higher prices for chemicals, energy and metals, average cost burdens increased and some manufacturers passed part of the additional cost burden on to their clients by hiking their charges.
"However, the rate of selling price inflation was mild, in the context of historical survey data," the survey noted.

GST collection crosses Rs 1-trillion mark in October: Arun Jaitley

For the first time since April, Goods and Services Tax (GST) collection for a single month has crossed Rs 1 trillion.
"GST collections for October 2018 have crossed Rs. 1 lakh crore (1 trillion). The success of GST is lower rates, lesser evasion, higher compliance, only one tax and negligible interference by taxation authorities," Finance Minister Arun Jaitley said in a tweet.

GST collections for October 2018 have crossed Rs. 1 lakh crore. The success of GST is lower rates, lesser evasion, higher compliance, only one tax and negligible interference by taxation authorities.
— Arun Jaitley (@arunjaitley) November 1, 2018
After it touched the one trillion mark for first time in April 2018, GST collections had missed the target for five straight months.
The collections stood at Rs 940.16 billion in May, Rs 956.10 billion in June, Rs 964.83 billion in July, Rs 939.60 billion in August and Rs 944.42 billion in September.
The Finance Ministry had targeted monthly GST collections to be Rs 1 trillion for this fiscal.
GST rate cut on a range of products from July 27 likely to have resulted in the subdued numbers.

Airlines' FY19 losses may be steepest in 10 yrs on ATF, rupee woes: Crisil

Domestic airlines are projected to post the steepest losses in a decade in the current fiscal year owing to higher aviation fuel costs and falling rupee, rating agency Crisil said in a report Thursday.
Pitching for a 12 per cent hike in airfares to offset the increased costs, the report also forecast debt liability of three listed airlines to go up by 10 per cent by FY19.
At present, full-service carriers Jet Airways and budget airlines SpiceJet and IndiGo are listed on bourses. They account for 71 per cent of the total passenger traffic.
Aviation turbine fuel (ATF) accounts for 35-40 per cent of the total cost of airlines, while aircraft, engine rentals and maintenance costs, which are denominated in US dollars, together account for another 30-35 per cent of the costs, as per Crisil.
"At an estimated Rs 93 billion, the industry's losses at EBIT (earnings before interest and tax) level would surpass the Rs 73.48 billion blow it was dealt in fiscal 2014. That was followed by three good years through fiscal 2018 when carriers reeled in an aggregate profit of Rs 40 billion on average at the EBIT level," the report said.
ALSO READ: No end to Jet Airways' free fall: Will the airline go Kingfisher's way?
Noting that the ATF prices are expected to average 28 per cent higher on-year compared with FY18, the report said such a hike will have a significant impact on the airlines' balance sheets.
The government has taken some measures to support the industry by lowering the excise duty levied on ATF by 300 basis points to 11 per cent, but this will not materially curb the losses, it said.
On the other side, the rupee has depreciated 13 per cent against the dollar since March, which is expected to deal a severe blow to the domestic airlines' financials, Crisil said.
ALSO READ: IndiGo's profitability takes back seat amid high fuel costs, weak rupee
"Almost two-thirds of an airline's cost, and therefore profitability, is susceptible to fluctuations in forex rates and ATF prices," said Sachin Gupta, senior director, Crisil Ratings.
He said to offset the increase in operating cost, the industry will have to hike average fares by 12 per cent, assuming there is no change in the passenger load factor (PLF) or seat factor.
"But the aggressive expansion plans of carriers and the race to maintain high PLFs will keep competitive intensity high and limit their ability to increase fares," he added.
Observing that the PLFs are highly sensitive to fares, the report said that in the past three fiscals, benign ATF prices helped airlines keep fares stable.
"Despite annual capacity growth of 15 per cent in the past three fiscals, PLFs increased because passenger growth was faster at 18 per cent," the agency said.

ALSO READ: Jayant Sinha asks FM to bring ATF under GST as rupee, oil woes hit airlines
Another headwind to fare hike is the significant fleet addition planned in the near-term, which will lead to capacity addition of over 20 per cent, as per the report.
Such a sharp increase in supply will keep the competitive intensity high and will constrain the ability of carriers to undertake fare hikes to pass on the increase in operating costs fully, the report said.
This was evident in the first quarter of FY19 when despite a 12 per cent rise in ATF prices, only one of the three listed players was able to increase yields, and that, too, by just 4 per cent, it added.
Furthermore, the depreciation in the rupee will translate into higher debt liability.
ALSO READ: ATF excise cut unlikely to give airlines relief, reduce customers' airfares
"Airlines have sizeable foreign currency debt, while their revenues are largely earned in rupees. With around 73 per cent of their debt denominated in foreign currency, the debt liability of the three listed airlines will go up by 10 per cent this fiscal," said Nitesh Jain, director, Crisil.
The agency in its report also said that the profiles of airlines will remain under pressure over near-to-medium term on account of significant increase in operating cost and limited ability to pass on cost increases to customers because of intense competition.

HDFC reports 25% jump in Q2 standalone net profit to Rs 24.67 billion

Mortgage lender HDFC Ltd on Thursday reported 25 per cent rise in its standalone net profit to Rs 24.6708 billion in second quarter ended September 30.
The company had registered a net profit of Rs 19.7819 billion in the corresponding period of 2017-18.

Total income during the September quarter stood at Rs 112.5696 billion, up from Rs 90.0737 billion in the same period of the previous financial year, HDFC Ltd said in a regulatory filing.
The consolidated figures were not provided by the company.
Shares of HDFC traded at Rs 1,756.95 apiece on BSE, down 0.71 per cent from its previous close.
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50 Indian items hit as US scraps duty-free privilege on 90 products' import

The US on Thursday revoked duty-free concessions on import of at least 50 Indian products, mostly from handloom and agriculture sectors, reflecting the Trump administration's tough stand on trade-related issues with New Delhi.
The federal register issued a notification, listing out 90 products which were so far subject to duty-free provisions under the Generalized System of Preferences (GSP).
President Donald Trump issued a presidential proclamation on Tuesday, leading to the removal of these products from the privilege beginning November 1.
As of November 1, these products "will no longer qualify for duty-free preferences under the GSP programme but may continue to be imported subject to regular Most Favored Nation duty-rates," an official of US Trade Representative told PTI.
A review of the products indicates that the presidential proclamation is not country-specific, but product specific.
ALSO READ: Arvind Panagariya bats for better deals with US on trade front
With India being the largest beneficiary of the GSP, it has been hit the most by the latest decision of the Trump administration.
The GSP, the largest and oldest US trade preference programme, is designed to promote economic development by allowing duty-free entry for thousands of products from designated beneficiary countries.
A count of these products indicated that at least 50 of them are from India. Notably, India is the largest beneficiary of the GSP. In 2017, India's duty-free export to the US under the GSP was to the tune of more than $5.6 billion.
The volume of India's export to the US impacted by the latest move of the Trump administration is not known yet, but the list of products from which duty-free import provision has been removed reflects that a large number of small and medium-size business could be impacted, in particular handloom and agricultural sector.
ALSO READ: India, US have exchanged offers for possible trade deal, says Suresh Prabhu
In his presidential proclamation, Trump said that certain 'de minimis' waivers will no longer be granted for any product, regardless of the country source, that exceeds the GSP's Competitive Need Limitation (CNL) thresholds. The CNL thresholds are quantitative ceilings on GSP benefits for each product and designated beneficiary country.
Trump said he had determined in 2017 certain beneficiary developing countries exported eligible articles in quantities exceeding the applicable competitive-need limitations.
"I hereby terminate the duty-free treatment for such articles from such beneficiary developing countries," he said.
Products from other countries like Argentina, Brazil, Thailand, Suriname, Pakistan, Turkey, the Philippines, Ecuador and Indonesia have also been removed from the GSP list.

ALSO READ: To cut trade deficit, India plans to boost export of 200 products to China
Some of the prominent Indian products removed from the duty-free provisions of the GSP include dried pigeon pea seed; areca nuts, fresh or dried, in shell; turpentine gum; mangoes, prepared or preserved by vinegar or acetic acid; sandstone, merely cut into blocks or slabs of a rectangular (including square) shape; tin chlorides; barium chlorides; salts and esters of tartaric acid, nesoi; and trimethyl phosphite.
Full grain unsplit or grain split buffalo hide or skin; grain split whole buffalo leather, without hair on; whole buffalo skin leather (not full grain unsplits/grain splits); and full grain unsplit buffalo leather (not whole), have also been removed from the duty-free the GSP list.
Dyed, plain weave certified hand-loomed fabrics of cotton, containing 85 per cent or more cotton by weight; plain weave certified hand-loomed fabrics of cotton, containing 85 per cent or more cotton by weight, hand-loomed carpet and other textile floor coverings, not of pile construction, woven, made up of man-made textile materials have also been removed.
ALSO READ: Lack of convergence, FTA hurdles to plague any US-India trade deal: Report
Base metal clad with gold mixed link necklaces and neck chains and keyboard musical instruments, like harmoniums and similar keyboard instruments with free metal reeds are among the other products.
These products can still be exported to the US from India but they will be subject to regular tariffs.
In April, the US announced eligibility review of India for the GSP. According to the USTR, the total US imports under GSP in 2017 was $21.2 billion, of which India was the biggest beneficiary with $5.6 billion, followed by Thailand ($4.2 billion) and Brazil ($2.5 billion).
The programme has now been renewed through December 31, 2020.
ALSO READ: 'Forgoing India, US trade deal will send negative signals to investors'
FICCI in a submission to the USTR had said that the termination of the GSP would be contrary to the legislative objective and the history of the Trade Reform Act of 1974 of furthering the economic development of developing countries.
It would cause significant distress to the export-oriented sector leading to increased cost for US industries that use products under the GSP, it said.
In June, India urged the Trump administration not to withdraw it from the GSP.

GN Bajpai resigns from govt-appointed IL&FS board, cites 'personal reasons'

Debt-ridden Infrastructure Leasing & Financial Services (IL&FS) Thursday said GN Bajpai has resigned from the company's newly-appointed board, citing personal reasons.
His resignation will be effective October 30.
Bajpai, an ex-Sebi chairman, was one of the seven directors appointed on the company's board by the government following NCLT order to supersede previous board.
"The company has been intimated by the ministry of corporate affairs, vide its letter dated October 30, 2018, that due to personal reasons, GN Bajpai, director of IL&FS, has resigned from the board of directors of the company with effect from October 30, 2018," the firm said in a regulatory filing.
ALSO READ: IL&FS crisis: This subsidiary ran business without capital for 3 years
Post Bajpai's exit, the members remaining on the company's board are banker Uday Kotak, who is the chairman; ICICI Bank executive chairman GC Chaturvedi; IAS officer and the director general of shipping Malini Shankar; Mahindra group's Vineet Nayyar, veteran auditor Nandkishore and CS Rajan, a former chief secretary of Rajasthan.

ALSO READ: IL&FS new board moves to clean up debt mess, introduces austerity measures

Google workers stage global walk out on its handling of sexual harassment

Hundreds of Google engineers and other workers around the world walked off the job Thursday to protest the internet company's lenient treatment of executives accused of sexual misconduct.
It is the latest expression of a backlash against men's exploitation of female subordinates in a business, entertainment and politics.
In Silicon Valley, women also are becoming fed up with the male-dominated composition of the technology industry's workforce a glaring imbalance that critics say fosters unsavoury behaviour akin to a college fraternity house.
Employees were seen staging walkouts at offices from Tokyo and Singapore to London and Dublin.
The Google protest, billed "Walkout For Real Change," is unfolding a week after a New York Times story detailed allegations of sexual misconduct about creator of its Android software, Andy Rubin.
The report said Rubin received a $90 million severance package in 2014 even though Google concluded the sexual misconduct allegations against him were credible.
Rubin derided the Times story article as inaccurate and denied the allegations in a tweet.
The same story also disclosed allegations of sexual misconduct of other executives, including Richard DeVaul, a director at the same Google-affiliated lab that created far-flung projects such as self-driving cars and internet-beaming balloons.
DeVaul had remained at the "X'' lab after allegations of sexual misconduct surfaced about him a few years ago, but he resigned Tuesday without severance, Google confirmed Wednesday.
ALSO READ: #MeToo: Here's How Google protected Andy Rubin, the 'father of Android'
Google CEO Sundar Pichai apologised for the company's "past actions" in an email sent to employees Tuesday.
"I understand the anger and disappointment that many of you feel," Pichai wrote.
"I feel it as well, and I am fully committed to making progress on an issue that has persisted for far too long in our society and, yes, here at Google, too."
The email didn't mention the reported incidents involving Rubin, DeVaul or anyone else, but Pichai didn't dispute anything in the Times story.
In an email last week, Pichai and Eileen Naughton, Google's executive in charge of personnel issues, sought to reassure workers that the company had cracked down on sexual misconduct since Rubin's departure four years ago.
Among other things, Pichai and Naughton disclosed that Google had fired 48 employees , including 13 senior managers, for "sexual harassment" in recent years without giving any of them severance packages.
But Thursday's workout could signal that a significant number of the 94,000 employees working for Google and its corporate parent Alphabet Inc remained unconvinced the company is doing enough to adhere to Alphabet's own edict urging all employees to "do the right thing."

A Silicon Valley congresswoman tweeted her support of the Google walkout using the "metoo" hashtag that has become a battle cry for women fighting sexual misconduct.
"Why do they think it's OK to reward perpetrators & further violate victims?" asked Rep Jackie Speier, who represents an affluent district where many of Google's employees live.