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BUZZ-Slow property market another dent in India's capex recovery
August 12, 2015 / 7:04 AM / 2 years ago

BUZZ-Slow property market another dent in India's capex recovery

** Slump in earnings of capital goods makers coupled with slow property market is raising fresh red flags over much anticipated recovery in capex

** Larsen and Toubro posted a 37 pct slide in Q1 profit while Bharat Heavy Electricals June-quarter profit declined by 82.5 pct

** June quarter data shows new property launches up only 1 pct YoY while prices rose only by 3 pct YoY - CLSA

** The real estate market accounts for 23% of total capex and a slowdown here is almost as important as the government capex increase - CLSA

** State-run companies with a cash balance of around $60 bln are seen as flag bearer of the next capex cycle - Morgan Stanley

** Private sector capex yet to pick up following the post-2009 clampdown as India Inc shelved spending plans to battle stretched balance sheets and an economic slowdown

** Sentiment indicators have moderated amid parliament logjam; capex led recovery hopes may disappoint - UBS

** India stocks: walking a fine line as bears sniff an opportunity (RM: abhishek.vishnoi.thomsonreuters.com@reuters.net; RM: vikram.subhedar.thomsonreuters.com@reuters.net)

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