New Delhi: India’s inflation rate rose, to its highest since October 2008, accelerating 8.56% in January up from 7.31% in December and 4.95% a year ago. The rise puts more pressure on the government to reverse stimulus measures that helped India’s economy grow nearly 8%, faster than expected. The Reserve Bank of India hiked the cash reserve ratio in January, taking a step towards cooling down the economy.
And some analysts are saying that Bharti Airtel’s offer to buy the African assets of Kuwait’s mobile telecom firm Zain, looks too expensive. Zain’s Africa business represents about 62% of the company’s 64.7 million customers, but only 15% of its net profit and is loss making at the profit-after-tax level. Bharti Airtel would be paying approximately $250 for each of Zain’s 42 million customers, excluding Sudan and Morocco. With fierce price competition in the mobile space in India, Bharti Airtel is looking to acquire assets outside the country. Shares of Bharti fell 9.2% for the day.
In auto news, Tata Motors reported a jump in global sales by 93% in January to over 85,000 units. Sales of its luxury brands from Jaguar Land Rover were up 195% from the same period last year to 16,269 units. Increased demand for both commercial and passenger vehicles helped boost sales for the company.
And markets lost ground on Monday led by Bharti-Airtel, as investors gave a thumbs down to its $10.7 billion bid to buy Kuwait’s Zain’s African assets.
The Sensex fell 114 points to close at 16,038 and the Nifty retreated 25 points to end trade at 4,801.