BUSINESS AND ECONOMIC ENVIRONMENT

Submitted by-

Vaibhav Singh

JN180177

MACRO INDICATORS OF ECONOMY

Indicators Q1 2017- Q2 2017-18 Q3 2017- Q4 2017- Q1 2018- Q2 2018-19
18 18 18 19
Current 2.4% of 1.2% of 2.0% of 1.9% of 2.5% of 2.9% of
Account Deficit GDP GDP GDP GDP GDP GDP
GDP Growth 5.6% 6.3% 7% 7.7% 8.2% 7.2%
Rate

1. Current Account Deficit: - The current account deficit is a measurement of a

country’s trade where the value of the goods and services it imports exceeds
the value of the goods and services it exports.

As per above table in which India’s CAD widening by each quarter. Its reaches
around 2.9% of GDP due the rise in price of oil sharply. It indicates need to
increase export to lower down the current account deficit. Growth rate of
exports.

2. GDP Growth Rate: - Real Economic Growth Rate is the rate at which a
nation's Gross Domestic product GDP changes grows from one year to
another. GDP is the market value of all the goods and services produced in a
country in a particular time period.
As per above table GDP grow at 7.2% in FY2018-19 Q2 which one is less as
compare to FY2018-19Q1.In FY2017-18 GDP grow at 6.65% which one is less as
compare two Quarter of FY2018-19.In FY2017-18 low GDP growth due to
impact of demonetisation and Implementation of GST.

Indicators 2013-14 2014-15 2015-16 2016-17 2017-18

Fiscal 4.5 % of GDP 4% of GDP 3.9% of GDP 3.5% of GDP 3.5% of GDP
Deficit
WPI 5.2% 1.2% -3.7% 1.7% 3.68%
Inflation
CPI 9.5% 5.9% 4.9% 4.5% 3.3%
Inflation

3. Fiscal deficit: - The difference between total revenue and total expenditure
of the government is termed as fiscal deficit. It is an indication of the total
borrowings needed by the government. While calculating the total revenue,
borrowings are not included.

As per above table Fiscal deficit at 3.5 per cent of the GDP in the 2017-18
which is similar to previous fiscal year. In current Fiscal Year government
targeted around 3.3 per cent of GDP which reported in budget 2018.

4. WPI Inflation: - Wholesale Price Index (WPI) represents the price of goods at
a wholesale stage i.e. goods that are sold in bulk and traded between
organizations instead of consumers.

5. CPI Inflation: - Consumer Price Index (CPI) is a measure that examines the
weighted average of prices of a basket of consumer goods and services, such
as transportation, food and medical care. It is calculated by taking price
changes for each item in the predetermined basket of goods and averaging
them.
As Inflation target set by government to maintain between 2% and 6%. CPI in
financial year 2013-14 jumps to 9.5%. After onwards Government try to
control in between to set target. As per 4 years In India inflation remain in the
range of 2% and 6%. This is good sign for economy.

INDEX OF INDUSTRIAL PRODUCTION

Group Weight 2016- 2017- April- August September-

(per 17 18 September - 18 18
cent) 2018-19
Mining 14.373 5.3 2.3 3.3 -0.5 0.2
Electricity 77.633 4.4 4.6 5.3 5.1 4.6
Manufacturing 7.994 5.8 5.4 6.2 7.6 8.2
General Index 100.00 4.6 4.4 5.1 4.7 4.5
Use Based Classification
Primary Goods 34.05 4.9 3.7 4.8 2.5 2.6
Capital Goods 8.22 3.2 4.0 7.3 9.3 5.8
Intermediate goods 17.22 3.3 2.3 1.2 2.8 1.4
Infrastructure/construction 12.34 3.9 5.6 8.7 8.0 9.7
goods
Consumer Durables 12.84 2.9 0.8 8.1 5.3 5.2
Consumer Non – Durables 15.33 7.9 10.6 4.0 6.5 6.1

Sectoral Industry Groups:-

The weightage of Manufacturing, Mining and Electricity production in
overall Index of Industrial Production (IIP) is 77.633 per cent, 14.373 per cent
and 7.994 per cent respectively.

The IIP registered growth of 4.5 per cent in September, 2018 over the Index of
September, 2017. IIP growth rate of August, 2018 revised upwards from 4.3
per cent (provisional) to 4.7 per cent. The growth for Index of Manufacturing,
Mining and Electricity was 4.6 per cent, 0.2 per cent and 8.2 per cent
respectively during September, 2018.
IIP registered Cumulative growth of 5.1 per cent during the period April to
September, 2018-19 over corresponding period of previous year. The Index of
Manufacturing, Mining and Electricity sector grew by 5.3 per cent, 3.3 per
cent and 6.2 per cent respectively during April to September, 2018-19 over
corresponding period of previous year.

Use-based industry groups:-

As per the Use-based classification, the Index for Primary goods,
Capital goods, Intermediate goods, Infrastructure/construction goods,
Consumer durables and Consumer non- durables registered positive growth
of 2.6 per cent, 5.8 per cent, 1.4 per cent, 9.5 per cent, 5.2 per cent
and 6.1 per cent respectively during September, 2018.

Cumulatively, for the period April-September, 2018-19, Primary goods,

Capital Goods, Intermediate goods, Infrastructure/construction goods,
Consumer Durables and Consumer non-durables registered positive
growth of 4.8 per cent, 7.3 per cent, 1.2 per cent, 8.7 per cent, 8.1 per
cent and 4.0 per cent per cent respectively.
 SECTOR WEI 2015 2016 2017- Apr- Apr-
GHT -16 -17 18 Oct Oct2018
2017- -19
18
Coal 10.3 4.8 3.2 2.6 1.8 9.8
3
Crude Oil 8.98 -1.4 -2.5 -0.9 -0.2 -3.6
Natural Gas 6.87 -4.7 -1.0 2.9 4.7 -0.8
Refinery 28.0 4.9 4.9 4.6 2.9 5.8
Product 37
Fertilizers 2.62 7.0 0.2 0.03 -1.3 -0.3
Steel 17.9 -1.3 10.7 5.6 6.0 3.3
1
Cement 5.37 4.6 -1.2 6.3 -1.4 15.0
Electricity 19.8 5.7 5.8 5.3 5.3 6.9
5
Overall 100 3.0 4.8 4.3 3.5 5.4
Index

Growth rate of core Industries in Last Four years:-

As per the table given in the table:-

1. Coal: - It is an essential product require for the production of electricity.
Its growth rate in last quarter is 9.8 which is highest in 4 years. Its Shown
good sign for Economy.
2. Crude Oil: - Due to rise in the price of the Oil in first and second Quarter
of the current financial year. Its demand decline from the previous year.
3. Natural Gas: - Demand of the natural gas increasing from continuous five
years. It’s mainly Government policy and initiative towards promotion of
natural gas in the home. It’s showing good sign for the Economy.
4. Refinery Products: - These products mainly used in the export outside the
country. Its Growth rate Increase from last 4 years. Its good sign for the
economy. It’s give boost to domestic consumption and exports for the
country.
5. Fertilizers: - Its growth decreasing in last Quarter of current financial year.
Its not good sign for economy due to farm distress. Its growth in 4
financial years also shown not good growth.
6. Steel: - It’s growing from last five years. It’s showing good growth and
demand in the construction Industry.
7. Cement: - Its growth rate around 15 in last quarter of current financial
year. Its great sign for the construction Industry.

Domestics Indices Return (%) in Last Five Years:-

Indices 1Y 2Y 3Y 4Y 5Y
Sensex 8.7% 34.58% 43.46% 31.37% 73.44%
NIFTY -6.2% 26.78% 45.87% 52.92& 128%
NIFTY500 -.27% 28.84% 41.27 35.88 90.86
NIFTY100 3.94 30.55 42.41 34.38 82.08
BSE SMALL -19.3 18.61 29.29 30.98 136.46
CAP
Indicators of Money Markets:-

ITEM 8 9 16 23 30 9
Dec Nov Nov Nov Nov Dec
2017 2018 2018 2018 2018 2018
Call 5.83 6.43 6.38 6.42 6.39 6.36
Money
Rate
(Weighted
Average)
91-Day 6.15 6.94 6.90 6.81 6.77 6.73
Treasury
Bill
(Primary)
Yield
182-Day 6.27 7.23 7.17 7.10 7.06 7.22
Treasury
Bill
(Primary)
Yield
364-Day 6.25 7.42 7.33 7.27 7.22 7.15
Treasury
Bill
(Primary)
Yield
10-Year G- 7.27 7.81 7.85 7.77 7.64 7.41
Sec Par
Yield
(FBIL)
 GLOBAL INDICES ANALYSIS:-

US S&P (500)

DATE OPEN HIGH LOW CLOSE ADJ VOLUME

CLOSE
10-12- 2630. 2685. 2583.2 2599.9 2599.95 19975530000
2018 86 44 3 5
03-12- 2790. 2800. 2621.5 2633.0 2633.08 18044060000
2018 5 18 3 8
10-09- 2906. 2908. 2895.7 2904.9 2904.98 3149800000
2018 38 3 7 8
11-06- 2783. 2789. 2761.7 2779.6 2779.66 8955680000
2018 21 06 3 6
01-01- 2683. 2872. 2682.3 2823.8 2823.81 76860120000
2018 73 87 6 1

As above table shown US S&P (500)indices shown data of months in which first row and
second row indicate weekly movement of share price , first and third movement in share
price of 3 months. First and fourth row show the movement of share price in 6 months.
First and fifth row show movement of share price in 11 months.
UK FTSE 100
DAT OPEN HIGH LOW CLOSE ADJ VOLUME
E CLOSE
10- 6778. 6908. 6719. 6845. 6845. 421900140
12- 1 5 2 2 2 0
2018
03- 6980. 7145. 6673. 6778. 6778. 432617500
12- 2 5 6 1 1 0
2018
12- 7105. 7186. 6969 7013. 7013. 495070640
11- 3 3 9 9 0
2018
09- 7277. 7325. 7220. 7304 7304 325561180
09- 7 3 5 0
2018
10- 7681. 7793. 7633. 7633. 7633. 519297720
06- 1 5 9 9 9 0
2018
01- 7687. 7727. 7624. 7724. 7724. 248981430
01- 8 7 1 2 2 0
2018

As above table shown UK FTSE 100indices shown data of months in which first row and
second row indicate weekly movement of share price , first and third movement in share
price of 3 months. First and fourth row show the movement of share price in 6 months.
First and fifth row show movement of share price in 11 months.