Union Budget FY 2010 -11 - Highlights 26/02/10

— Net revenue gain from tax proposals at Rs 20,500 crore
— Certain accredited news agencies exempted from service tax
— Service tax to remain 10 per cent
— Increase in duty on gold and silver import
— Clean energy cess of Rs 50 per tonne to be levied on coal produced in India
— 10 per cent central excise duty on all non-petroleum products
— Structural changes in excise duties on cigarettes, cigars and cigarillos.
— Revenue loss of Rs 26,000 crore on direct tax proposals.
— 7.5 per cent duty on petrol, diesel, crude restored.
— Exempt duty raised for all non-smoking tobacco producs
— Investment linked tax deductions to be allowed to two—star hotels anywhere in the country.
— Fiscal deficit seen at 4.8 per cent and 4.1 per cent in 2011—12 and 2012—13 respectively.
— Income Tax department ready with two—page Saral—2 return forms for individual salaried assesses
— Surcharge on companies reduced to 7.5 per cent
— Additional exemption of Rs 20,000 for long term investment in infra bonds
— Ten per cent tax slab for income above 1.6 lakhs up to Rs. 5 lakhs.
— 20 per cent tax for income above Rs 5 lakh and up to Rs 8 lakh
— 30 per cent tax for income above Rs 8 lakh.
— National Social Security Fund created for workers in unorganized sector with allocation of Rs.1,000 crore
— Government to give Rs.1,000 for each National Pension Scheme account opened by workers in the unorganised sector
— Exclusive skill development programme for the textile sector
— Fifty percent hike in allocation for schemes for women and child development
— Rs.4,500 crore allocated for ministry of social justice and empowerment, a hike of 80 percent
— Rs.2,600 crore allocated for ministry of minorities affairs
— Rs.1,900 crore for Unique Identification Authority of India
— Rs.147,344 crore allocated for defence
— 2,000 youth to be recruited in central paramilitary forces
— Draft Food Security Bill prepared and will be put in the public domain
— Allocation on primary education raised from Rs.26,800 crore to Rs.31,300 crore
— Banking facilities to be provided to all habitations with a population of 2,000 and more
— Rs.66,100 crore allocated for rural development in 2010—11; Rs.40,100 crore for National Rural Employment Scheme; RS.48,000 crore for Bharat Nirman
— Rs.1,270 crore allocated for Rajiv Awas Yojna for slum dwellers, up from Rs.150 crore, an increase of 700 percent with the aim of creating a slum free India.
— Forty—six percent of plan allocations in 2010—11 will be for infrastructure development
— Coal Regulatory Authority to be set up to benchmark standards of performance
— Allocation for new and renewable energy sector increased 61 % from Rs.620 crore to Rs.1,000 crore in 2010—11
— National Clean Energy Fund to be established
— Rs.200 crore allocated as special package for Goa to prevent erosion and increase green cover.
— Government committed to growth of SEZs.
— Four—pronged strategy for growth of agricultural sector.
— Rs.200 crore to be provided in 2010—11 for climate—resilient agricultural initiative.
— Involvement of private sector in grain storage to continue for another two years.
— In view of drought and floods, debt repayment period extended to June 2010.
— Five more mega food processing projects in addition to 10 existing ones.
— FDI flows in April—December 2009 $20.9 billion.
— FDI policy to be made more user—friendly with one comprehensive document.
— Apex level financial stability council to be set up for banking sector.
— Indian Banking Association to give additional licences to private players.
— Provision for further capital for regional rural banks.
— Roadmap for reducing public debt in six months.
— Implementation of direct tax code from April 2011.
— Government actively engaged in finalising structure of general sales tax regime; hopes to implement it from April 2011.
— Rs.35,000 crore raised from divestment in 2009—10; will be higher in 2010—11.
— New fertiliser policy from April 2010; will lead to improved productively and more income for farmers.
— Economy stabilised in first quarter of 2009—10; strong rebound in second quarter; overall growth at 7.2 and could be higher when Q3 and Q4 are taken into account.
— Export figures for January encouraging.
— Hope to breach 10 percent growth mark in not too distant future.
— Government set in motion steps to bring down food inflation.
— Need to review stimulus package; need to make growth more broad—based.
— India has weathered global economic crisis well; Indian economy in far better position than it was a year ago. In 2009 Indian economy faced grave uncertainty; delay in southwest monsoon had undermined agricultural production.
— First challenge now is to quickly revert to 9 percent growth and then aim for double digit growth; need to make recovery more broadbased.
— Second challenge is to make growth more inclusive; have to strengthen food security.
— Third challenge is to overcome weakness in government's public delivery mechanism; a long way to go in this.

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NIFTY MOVEMENT ON UNION BUDGET DAY SINCE 1999
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FEB 27, 1999 +5.13%
FEB 29, 2000 -5.12%
FEB 28, 2001 +4.38%
FEB 28, 2002 -3.87%
FEB28, 2003 +0.19%
JAN 8, 2004 +2.54%
JULY 8, 2004 -2.25%
FEB 28, 2005 +2.18%
FEB 28, 2006 +0.86%
FEB 28, 2007 -4.01%
FEB 29, 2008 -1.38%
JULY 6, 2009 -5.83%

FEB 26, 2010 +1.29

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Weekly outlook 21/02/2010

Weekly outlook 21/02/2010

Without doubt, next week will be action-packed for the Indian markets.Apart from Railway Budget, Economic Survey and Union Budget, we will also have to grapple with the F&O expiry and of course Q3 GDP figures.To add to the anxiety would be newsflow from the external front, which of late has been exerting quite an influence on the overall market sentiment. Talking of global markets, China will resume trading after a long holiday. The surprise hike in reserve ratio just before the holiday started and the Fed move to raise the discount rate could weigh on that market. Not much data is expected from China next week.On the other hand, a lot of economic reports are due from the US next week, including a spate of data on housing and revision in third
quarter GDP.

Coming back to India, the main focus will be on Budget and what the two Bengali ministers have in store for all concerned. One thing is sure they can't afford to be too populist this time around. They better not, as the economy is at a crucial juncture and any further slippage in policy making could hurt its prospects going forward. A broad consensus that is emerging on the Budget is that there will definitely be a partial rollback of fiscal stimulus, besides articulation of a roadmap to return to the path of fiscal prudence.One should also watch out for announcements on disinvestment, GST rollout, 3G auction and the Centre's estimate of market borrowings.
Given the spiraling inflation, we expect the Government to try and address growing concerns on this front as well.

Speaking of sectors that might gain from the Budget, the usual suspects are Infrastructure, Education, Fertilizers, Textiles,Agriculture, etc.

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United Bank of India - IPO
-----

United Bank of India is a public sector banking institution with branches in 28 States and in 4 Union Territories in India. The Bank is currently wholly-owned by the Government of India. As of December 18,2009, they had 1,484 branches, 265 ATMs, 28 regional offices and 11 extension counters. United Bank is in the process of opening a representative office in Dhaka, Bangladesh. As of December 18, 2009,company had a workforce of 15,813 employees (including part-time
employees). United Bank of India is one of the 14 banks which were nationalised on July 19, 1969.

United's business is principally divided into retail banking,corporate / wholesale banking, priority sector banking, treasury operations and other banking services such as agency functions for insurance and mutual fund distribution, pension and tax collection services. Their retail banking business provides financial products and services to retail customers. United Bank provide loans and advances for housing, trade, automobiles, consumer durables,education, personal loans and other retail products. Also they provide commercial banking products and services to corporate customers, including mid-sized and small businesses and government entities. They offer direct financing to farmers for production and investment, as well as indirect financing for infrastructure development and credit to suppliers of agricultural inputs.

In Fiscal 2009, company made a net profit of Rs. 358.55 crore and had net assets of Rs. 61,500.78 crore and net worth of Rs. 2,537.83 crore.As of September 30, 2009, they made a net profit of Rs. 231.10 crore and had net assets of Rs. 71,952.25 crore and net worth of Rs.2,769.87 crore. They have experienced growth in deposits and advances,with deposits growing at a compounded annual rate of 21.1% during the last five fiscal years and net advances growing at a compounded annual rate of 32.8% during the same period.

The objects of the Issue are:

1. To augment capital base to meet the future capital requirements arising out of the growth in their assets due to the growth of the Indian economy; and 2. For meeting the expenses of the Issue.

Issue Detail:

»» Issue Open: Feb 23, 2010 - Feb 25, 2010
»» Issue Type: 100% Book Built Issue IPO
»» Issue Size: 50,000,000 Equity Shares of Rs. 10
»» Issue Size: Rs. 300.00 - 330.00 Crore
»» Face Value: Rs. 10 Per Equity Share
»» Issue Price: Rs. 60 - Rs. 66 Per Equity Share
»» Market Lot:
»» Minimum Order Quantity:
»» Listing At: BSE, NSE

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IPO Listing - Aqua Logistics Ltd
-----------
Aqua Logistics Ltd IPO will list on Tuesday, February 23, 2010. Issue
price of this IPO has been fixed at Rs 220/- per share. Aqua Logistics
IPO subscribed 1.94 times(3.0002 times in retail).

IPO Listing Detail

Listing Date: Tuesday, February 23, 2010
BSE Script Code: 533159
NSE Symbol: AQUA
Listing In: B Group
ISIN: INE544K01018
Issue Price: Rs. 220.00 Per Equity Share
Face Value: Rs. 10.00 Per Equity Share

-----------
IPO Listing - DB Reality Ltd
-----------
DB Realty Ltd IPO will list on Wednesday, February 24, 2010. Issue
price of this IPO has been fixed at Rs 468/- per share. IPO was
oversubscribed by 2.95 times (0.3658 times in retail).

IPO Listing Detail


Listing Date: Tuesday, February 24, 2010
BSE Script Code: 533160
NSE Symbol: DBREALTY
Listing In: B Group
ISIN: INE879I01012
Issue Price: Rs. 468.00 Per Equity Share
Face Value: Rs. 10.00 Per Equity Share


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