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Retail Inflation Slides To 5.02% In Sept, Lowest In Three-Month

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Food inflation, which accounts for nearly half of the overall consumer price basket, rose 6.56 per cent in September as compared with 9.94 per cent in August

India’s retail inflation eased to 5.02 per cent from 6.83 per cent in September which is a three-month low banking on sliding vegetable prices but remained above 4 per cent, a target aimed by the Reserve Bank of India (RBI).

It is likely that RBI would like to get comfortable with inflation before easing rates. However, it came between the tolerance band of 2-6 per cent of the central bank.

Food inflation, which accounts for nearly half of the overall consumer price basket, rose 6.56 per cent in September as compared with 9.94 per cent in August.

RBI earlier this month kept its key lending rate steady for a fourth consecutive policy meeting and emphatically reiterated that it is targeting inflation of 4 per cent and a print of below 6 per cent may not suffice as a condition for easing rates.

Vegetable prices were the key driver in keeping inflation elevated in the previous two months, forcing the government to ban some exports of rice and raise duties for onions.

Vegetable inflation sharply eased to 3.39 per cent in September from 26.14 per cent in the previous month. Cereal inflation in September eased to 10.95 per cent from 11.85 per cent in August. India has also banned exports of wheat since last year.

Ranen Banerjee, Partner, Economic Advisory Services, PwC India expects that the policy rates to remain unchanged for quite some time – at least till Q1 of FY25 – given the inflation prints in coming months will face upward pressure risks from the possible lower farm outputs owing to uneven rain experienced during monsoons. 

Global crude prices remaining elevated owing to production cuts, Chinese impetus and geopolitical flare ups will put further pressure on the inflation front, Banejee added.

Economist at Acuité Ratings & Research, Suman Chowdhury also believes that due to El Nino phenomenon, the yield in the upcoming kharif crop may get impacted, the lower acreage and the expected decline in domestic pulses production.

It is given that the prices of pulses are on the rise with an inflation print of 16.38 per cent. Cereal inflation continues to be in double digits at 10.95 per cent YoY despite the steps taken by the government to cool down the market prices of wheat and rice.

For fintech sector, CEO and Co-founder of Biz2Credit and Biz2X, Rohit Arora said that it will to a more predictable environment for interest rates and lending conditions, setting the stage for continued growth and innovation.

 

 

start-up

RBI’s CBDC Pilot In Retail Has Blockchain Tech Components: Centre Tells Rajya Sabha

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The Reserve Bank of India (RBI) has issued a concept note on Central Bank Digital Currency (CBDC) on 7 October 2022 which can be accessed at RBI’s website, said Pankaj Chaudhary, Union Minister of State for Finance

The Central Bank Digital Currency (CBDC) pilot launched by the RBI in the retail segment has components based on blockchain technology, said Pankaj Chaudhary, Union Minister of State for Finance in a reply to a question in Lok Sabha on Monday. Chaudhary said that the bank has launched pilots of CBDC in both the wholesale and retail segments.

“The digital rupee (pilot in the whole segment)- Wholesale launched on 1 November 2022. This is expected to make the interbank market more efficient,” he said. Talking about the digital Rupee-Retail (e₹-R), the minister added that it was launched on 1 December 2022 in the pilot retail segment comprised of participating customers and merchants.

A total of eight banks have been finalised for phase-wise participation in the retail pilot project.  In the first phase, the banks included are the State Bank of India (SBI), the ICICI Bank, the Yes Bank and the IDFC First Bank. The rest four banks are the Bank of Baroda, the Union Bank of India, the HDFC Bank and the Kotak Mahindra Bank.

Chaudhary further notified that e₹-R is the kind of digital token that will represent legal tender and will be issued in the same denominations as the paper currency and coins. Furthermore, the distribution will be made through financial intermediaries, i.e., the banks. Transactions can be carried out by both person to person (P2P) and person to merchant (P2M). Like cash, the CBDC will not earn any interest and can be converted to other forms of money, like deposits with banks, he added.

NITIN GADKARI

Retail Portion Of NHAI’s InvIT To Witness Surge: Nitin Gadkari

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During early October, InvIT raised Rs 1,430 crore and the issue was oversubscribed around seven times. Nearly 25 per cent of the issue was reserved for retail investors. To pool money from investors and invest in assets in order to provide cash flows over a period of time, infrastructure investment trusts are developed

Union Highways Minister Nitin Gadkari, motivated by the overwhelming retail investor response to the recent Infrastructure Investment Trust (InvIT) from National Highway Authority of India (NHAI), said that the retail portion will surge in new such fund-raising ahead, on 28 October. The investment comprised of issuance of Non-Convertible Debentures (NCDs) worth Rs 1,430 crore.

The minister after listing the second share of the NHAI Infrastructure Investment Trust (InvIT) and Non-Convertible Debenture, addressed a gathering at Bombay Stock Exchange (BSE). During early October, InvIT raised Rs 1,430 crore and the issue was oversubscribed around seven times.

Nearly 25 per cent of the issue was reserved for retail investors, however NHAI did not respond on how many times the retail portion was oversubscribed. It rather said that it had an overwhelming response.

To pool money from investors and invest in assets in order to provide cash flows over a period of time, infrastructure investment trusts are developed. Such instruments work on the lines of mutual funds.

The minister without quoting any numbers said, more investment is required from general public in these InvITs and more specifically in our roads. He assured that NHAI’s roads offer 100 per cent security to investors with best internal rate of return (IRR). Moving ahead will fetch more portion being reserved for retail, he added.

NHAI chairperson Alka Upadhyaya also retreated the minister and said that the upcoming InvITs from the NHAI will help more units being reserved for retail, however she did not quote any number.

While addressing the gathering, Gadkari also said that the as of now InvIT has raised nearly Rs 8,000 crore from foreign and domestic institutional investors. However, the second share was special because 25 per cent of the NCD had been reserved for retail investors.

e-commerce

78% Consumers To Prefer Retail Stores Near Home This Festive Season

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A total of 10,058 people were surveyed out of which 67 per cent were from rural India while 33 per cent were from urban India. The consumption of essentials products (44 per cent), discretionary products (2 per cent), health-related items (37 per cent) have all recorded growth

The latest Axis My India October CSI Survey reveals that 78 per cent of consumers plan to shop from retail stores near home this festive season.

The survey also stated that 14 per cent of the respondents would prefer shopping through E-commerce sites and 43 per cent would be buying smaller packs of their monthly groceries. A surge of 58 per cent was also recorded in the overall household spending of the people. A total of 10,058 people were surveyed out of which 67 per cent were from rural India while 33 per cent were from urban India. The consumption of essentials products (44 per cent), discretionary products (2 per cent), health-related items (37 per cent) have all recorded growth. 

The mobility has also increased for 6 per cent of the families, and remains the same for 85 per cent. The sentiment to spend more than last year’s festive season is up by 1 per cent point to reach 21 per cent. 81 per cent of the respondents stated that shopping for family will contribute as a ‘major’ expense this festive season. 

Axis My India, released its latest findings of the India Consumer Sentiment Index (CSI), a monthly analysis of consumer perception on a wide range of issues. The October net CSI score, calculated by percentage increase minus percentage decrease in sentiment, is at +8, from +10 last month reflecting a decrease by 2 points. The sentiment analysis delves into five relevant sub-indices – Overall household spending, spending on essential and non-essential items, spending on healthcare, media consumption habits & mobility trends. 

Commenting on the CSI report, Pradeep Gupta, Chairman & MD, Axis My India, said “Increase in discretionary spends across households demarcates the continuity of festive sentiments. From visiting physical stores to scanning through online sites, consumers are not only investing on household products but are also splurging for themselves and their families. However, one can witness the spending capacity to be conscious as the expenses are mostly on low budget items such as clothes as compared to heavy ticket items such as vehicles or properties. Cash though continues to be the king, digital modes of payment like UPI & debit/credit card usage is also growing rapidly.”

The survey was carried out via Computer-Aided Telephonic Interviews with a sample size of 10,058 people across 32 states and Union Territories. 61 per cent of the respondents were male, while 39 per cent were female. 

e-commerce

Future Of Retail: A Report By Deloitte And Mapic India

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In the past two years, the entire retail dynamics altered significantly due to the pandemic-related disruptions

The Indian economy is expected to grow at a healthy pace and consumers are feeling confident about spending money. According to International Monitory Fund (IMF), India’s economic recovery is likely to pick a strong pace with GDP rising at 7.4 percent in FY23. The retail industry is expected to see a year-on-year growth of 10 percent to reach nearly US$2 trillion by 2032. India is the world’s fifth-largest retail market. It contributes more than 10 percent to GDP and nearly 8 percent to employment. In the past two years, the entire retail dynamics altered significantly due to the pandemic-related disruptions. 

Today, retailers are expected to accelerate the adoption of omnichannel strategy to operate proficiently amidst mobility restrictions, supply chain disruptions, and increasing competition. Increasing penetration of global brands has led to the emergence of new norms of loyalty for retailers where targeted marketing, personalised product selection, seamless purchase experience, customer loyalty programmes, and supply chain resiliency, have taken a front stage. While a large-scale convergence of online and offline channels will continue to happen, retailers are expected to invest in digital technologies to improve their operational efficiency and customer centricity and thrive in the rapidly changing and competitive consumer environment. 

1. Targeted Marketing 

• Targeted marketing using AI-based predictive analysis of customer social media profiles 

• Digital marketing using micro segmentation to provide a personalised experience 

2. Personalised Product Selection 

• Integrating brand websites and mobile apps seamlessly for a whole digital experience 

• Artificial intelligence (AI) try-ons, virtual mirrors, and trial rooms to improve the product selection process in stores and online 

• Vernacular languages are being added to e-commerce systems to increase client accessibility 

• Smart beacons to track consumer movement inside the store and give personalised product information and discounts

 3. Seamless Purchase Experience 

• Optional multi-nodal payment methods, such as click-and-collect, mobile Point of Sale (POS), and e-wallets 

• AI-based precision marketing to implement a compelling omnichannel pricing approach 

• Reduced wait times in retailers thanks to self-checkout machines 

4. Customer Retention and Loyalty 

• Enhancing customer retention with blockchain-based loyalty programmes

 • Offering memberships to devoted customers, automating discounted pricing, and bundling services and products 

5. Supply Chain Management 

• Making supply chain and logistics services more responsive using IoT, RFID, AI, and robotics 

\• Real-time inventory management and planning for store evaluation using data-driven algorithms

Rbi cfo

Retail Inflation Rises To 7 Percent

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The inflation print in July had come in at 6.71 per cent

Retail inflation in India, measured by the Consumer Price Index (CPI), in August rose to 7 per cent after falling for three consecutive months, data released by the Ministry of Statistics and Programme Implementation on Monday showed. The inflation print for July had come in at 6.71 per cent. This is above RBI’s 2 to 6 percent tolerance band in each month this year. This is despite significant decline in crude oil prices, which had a small impact on inflation.

However, essential crops like wheat, rice, pulses saw a significant price increase due to unfavorable weather conditions and erratic monsoon patterns. This becomes crucial as they constitute nearly half of the food consumer price index (CPI) basket. As per data, inflation in food basket was 7.62 per cent in August 2022, significantly up from 6.69 per cent in July 2022 and 3.11 per cent in August 2021. The high base effect makes inflation numbers look larger.

Erratic monsoon patterns across the country suggest more crop damages, keeping food prices elevated in the coming months, with negative seasonality kicking in for September-November and weighing on price pressures. The RBI raised its repo rate by 50 basis points (bps) in August 2022 to 5.40 per cent, taking the total rise since May this year to 140 bps. Its next policy decision is due on September 30, with expectations of a rise of fewer than 50 bps. These numbers have a cascading impact on inflation. These numbers may push the central bank into fire fighting mode like its contemporary bank in the weat.

reliance retails logo

Reliance Retail Takes Control Of Insight Cosmetics

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RRVL is also planning to establish 400-450 large-format stores to sell the acquired brands.

Reliance Retail Ventures Ltd (RRVL) has purchased a majority share in cosmetics and personal care firm Insight Cosmetics. This move marks the billionaire Mukesh Ambani-owned company’s foray into the beauty market. The deal is expected to be worth $10-15 million. 

Dinesh Jain, a Mumbai-based entrepreneur, founded Insight Cosmetics in 2001. The company claims to have a distribution presence in 20 states, and its items are offered in over 12,000 retail and novelty stores nationwide.

The acquisition is consistent with RRVL’s goal of expanding its beauty and personal care business, mostly through acquisitions, and competing with incumbents like Nykaa, Myntra, and Purplle in the fast-growing Indian omnichannel market for beauty goods. According to industry observers, RRVL has prioritised brands in the clothing, footwear, beauty, and personal care sectors in the fashion and leisure market. These brands will mostly be in the mass premium segment.

However, RRVL is also planning to establish 400-450 large-format stores to sell the acquired brands. According to another individual following RRVL’s inorganic approach, a few in-house labels may also be accessible at these outlets.

Previously in May 2022, RRVL was said to be in discussions to acquire a controlling share in a Mumbai-based women’s footwear company. In march, RRVL acquired 89 percent ownership in Purple Panda Fashions Pvt. Ltd, which owns and runs the Clovia women’s innerwear and loungewear brand. 

IPO

DreamFolks Services IPO Day 3: Retail Portion Subscribed 31.4 Times

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The IPO received bids for 14.61 crore equity shares against 94.83 lakh shares on offer, as per NSE data

Airport service aggregator DreamFolks Services initial public offering (IPO) on its third and final day of the offer saw 15.4 times subscription.

The IPO received bids for 14.61 crore equity shares against 94.83 lakh shares on offer, as per NSE data.

The quota for retail investors (RIIs) has been subscribed 31.4 times, the non-institutional investors portion has been subscribed 21.7 times and the portion for qualified institutional buyers seven times.

The IPO got fully subscribed within hours of opening on Wednesday ending the day with 1.96 times subscription.

The issue, entirely an offer for sale, is sized at Rs 562 crore at the upper end of the price band of Rs 308-326 a share.

DreamFolks started off operations in 2013 by facilitating lounge access services for consumers of Mastercard and now provides services to all card networks operating in India including Visa, Mastercard, Diners/Discover and RuPay.

Apart from lounge services, it also provides other airport related services such as food and beverages, spa, and pick-up-and-drop service.

ambani

Rs. 5,000 Crores Net Profit For Reliance Retail Ltd In FY22

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After the GST recovery is deducted, the net revenue from operations saw a surge of 29 per cent to reach Rs. 1,69,397.35 crores

Reliance Retail Ltd. recorded a net profit of about Rs. 5,000 crores in the fiscal year between 2021- 22. The entity’s net profit saw a surge by 7.6 per cent to reach ₹4,934.65 crores in the fiscal year ending March 31, 2022.

After the GST recovery is deducted, the net revenue from operations saw a surge of 29 per cent to reach Rs. 1,69,397.35 crores. The firm, which is India’s largest retailer recorded a net profit of three times the combined profit of its close rivals, namely, Avenue Supermarts, Tata-owned Trent, Shoppers Stop, Spencer’s Retail, and V-Mart Retail. Its revenue too was more than four times that of these rivals’ combined revenue.

As per the firm’s quarterly earnings announcement, the consolidated gross retail revenue for the fiscal year of 2022 reached Rs. 1,99,704 crore and the net profit was of Rs. 7,055 crore. In the previous fiscal, the firm’s gross revenue from operations had recorded a surge of 2 per cent reaching Rs. 1,49,925 crores and its net profit saw a decline by 17 per cent to record Rs. 4,587 crore. The firm’s net revenue from operations was ₹131,687.81 crore. In the recent annual report for the fiscal year of 2022, Reliance Ind claimed to have invested Rs. 30,000 crore for expansion of its stores presence. The firm claims to have added over 2,500 stores and 11.1 million square feet of warehousing space during the year.

rupee

Rupee Opens Tad Lower; Retail Inflation Data, Flows Eyed

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The rupee was trading at 79.6750 per dollar by 0332 GMT, compared to 79.63 in the previous session

The Indian rupee opened marginally lower than the US currency on Friday, as traders awaited the retail inflation data and eyed whether there will be any follow-through dollar demand.

The rupee was trading at 79.6750 per dollar by 0332 GMT, compared to 79.63 in the previous session.

Data due later in the day is expected to show India’s inflation rate eased in July but remained above the Reserve Bank of India’s (RBI) upper tolerance limit.

(Reuters)

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