.png)
India’s insurance sector has been at the center of policy reforms in recent years, aiming to improve financial inclusion and make risk protection more affordable. The latest discussion revolves around removing Goods and Services Tax (GST) on health and life insurance premiums. On the surface, this may look like a boon for customers. But beneath the surface, the implications are more complex—for insurers, the financial markets, and even long-term policyholders.
Currently, insurance premiums in India attract an 18% GST (except a few segments like certain micro-insurance products). For example:
Removing GST would reduce the immediate outflow for customers. However, insurers today enjoy input tax credit (ITC) on GST paid for their services, technology, and operations. If GST is removed, insurers lose this credit and may face higher net costs.
At first glance, policyholders save money upfront. A ₹25,000 health insurance policy would cost exactly₹25,000 instead of ₹29,500 (with GST). This reduction could encourage more people, especially in middle-income households, to purchase insurance.
However, if insurers pass on their increased operational costs due to loss of ITC, premiums could rise in the medium term. Customers may face:
For insurers, this move is a double-edged sword. On one side, the industry can promote insurance as more affordable and expand penetration. On the other side, companies may face-
This could also trigger industry consolidation, with stronger players leveraging technology and scale to offset costs.
India’s stock markets are highly sensitive to regulatory shifts, and insurance companies are a key part of the financial services sector indices (Nifty Financial Services, Nifty 50 in case of HDFC Life, SBI Life, ICICI Prudential).
For investors, GST exemption means:
Example: If SBI Life manages to offset ITC loss through its wide distribution and bancassurance tie-ups, it could sustain margins better than smaller peers.
The GST Council and Insurance Regulatory and Development Authority of India (IRDAI) both play a role in shaping this decision.
This reform aligns with the government’s larger push toward “Insurance for All by 2047”.
For investors trying to under stand the bigger picture, navigating the insurance sector’s dynamics requires research-backed insights.
At Swastika Investmart (SEBI Registered Research Analyst), we provide:
Q1. Will customers really save money if GST is removed from insurance premiums?
Yes, initially premiums will appear cheaper, but insurers may increase base premiums later due to higher operating costs.
Q2. How will this affect listed insurance companies like HDFC Life or SBI Life?
They may face margin pressure in the short term, but companies with scale and strong distribution can manage better.
Q3. Is this reform final?
Not yet. The GST Council has proposed it, but final implementation depends on government approval.
Q4. Will this boost insurance penetration in India?
Yes, lower upfront costs could encourage more middle-class families to buy insurance, supporting long-term penetration goals.
Q5. What should investors do?
Investors should monitor quarterly results of insurance companies and track how each adapts to regulatory shifts before making decisions.
The idea of insurance premiums without GST sounds appealing to customers, but the story is more nuanced. While households may save upfront, insurers could face margin pressures, potentially leading to higher premiums in the future. For investors, this is acritical policy shift that can reshape stock valuations in the financial services sector.
As the sector evolves, staying informed and guided by expert research is essential. With Swastika Investmart, you get trusted insights, tech-enabled investing tools, and dedicated support to help you make better financial decisions.
कीमती धातुओं के भाव में आक्रामक मौद्रिक नीति के चलते लगातार बिकवाली का दबाव बना हुआ है। पिछले सप्ताह सोने के भाव 50000 प्रति दस ग्राम के भीतर कारोबार करते नज़र आये जबकि प्रति किलो चांदी के भाव 52000 रुपये के निचले स्तरों को छू चुके है। अमेरिकी डॉलर, जो सोने के विपरीत दिशा में चलता है, में फेड प्रमुख जेरोम पॉवेल के बयान के बाद से ही तेज़ी जारी है और यह 110 के स्तरों के करीब पहुंच गया है जिससे सोने के भाव में दबाव बना हुआ है। अमेरिका से जारी होने वाली रोज़गार रिपोर्ट के आंकड़े लगातार बेहतर रहे है जिससे आर्थिक मंदी का डर कम हुआ है और इससे फेड को कठोर नीति कायम रखने में आसानी होगी। फेड श्रम से सम्बंधित आकड़ो पर कड़ी नजर रख रहा है ताकि यह पता लगाया जा सके कि नौकरी बाजार उच्च ब्याज दरों के प्रति कितनी सहनशीलता रखता है। पिछले सप्ताह जारी पैरोल के आकड़ो में नॉन फार्म एम्प्लॉयमेंट चेंज के आंकड़े अनुमान से बेहतर दर्ज किये गए जबकि बेरोज़गारी दर में बढ़ोतरी हुई है, लेकिन यह दर 4 प्रतिशत के नीचे रही जिसको फेड पूर्ण रोज़गार की स्थिति मानता है। अमेरिकी बेंचमार्क ट्रेज़री यील्ड चार साल के ऊपरी स्तरों पर पहुंच चुकी है जिससे डॉलर इंडेक्स को सपोर्ट मिला हुआ है और नॉन यील्डिंग सोने-चांदी की कीमतों में दबाव बन रहा है। ग्लोबल मैन्युफैक्चरिंग आकड़े कमजोर रहने के कारण चांदी के भाव में बिकवाली का दबाव है। इस सप्ताह गुरुवार को यूरोपियन सेंट्रल बैंक की मौद्रिक नीति कीमती धातुओं के लिए महत्वपूर्ण रहेंगी।
इस सप्ताह कीमती धातुए में मंदी रहने की सम्भवना है। अक्टूबर वायदा सोने की कीमतों में 49000 रुपये पर सपोर्ट है और 51000 रुपये पर प्रतिरोध है। दिसंबर वायदा चांदी में 51000 रुपये पर सपोर्ट और 54500 रुपये पर प्रतिरोध है।
Earnings season kicks off a few weeks after each fiscal quarter ends. It spans about a month, during which companies report their financial performance. Here’s a breakdown of the schedule:
Earnings season is when companies publicly disclose their financial performance for the previous quarter. This period is crucial for investors because it provides insights into a company’s profitability, revenue, and overall financial health. These reports help investors make informed decisions about their investments.
How to Use Earnings Information
Earnings season provides insights into various aspects of the economy:
Earnings season can give clues about how different parts of the economy are doing. Strong results from big companies can suggest a healthy economy, but it’s important to remember that the stock market and the economy don’t always move in the same direction.
Earnings season is a valuable period for investors to gain insights into company performance and market trends. By understanding key metrics, analyzing sector trends, and staying informed, you can make more strategic investment decisions. Use earnings reports to guide your investment strategy, whether that means trading stocks, investing in sectors, or making long-term decisions.
Remember, while earnings reports offer important information, they are just one part of a broader investment strategy. Always consider your overall investment goals and risk tolerance when making decisions based on earnings season insights
India was the eleventh-largest economy ten years ago, while the UK was the fifth-largest. Based on data on GDP provided by the International Monetary Fund. India surpass the UK in dollar terms annually this year, only behind the US, China, Japan, and Germany. In the final three months of 2021, India surpassed the UK to become the fifth-largest economy.
The IMF’s World Economic Outlook database shows India overtaking the U.K. in dollar terms on an annual basis this year with a GDP of $3.53 trillion compared to the U.K.’s $3.38 trillion.
According to adjusted figures and the dollar exchange rate on the last day of the relevant quarter, the Indian economy was worth $854.7 billion in nominal cash terms in the three months ending in March. The United Kingdom was $816 billion on the same basis. a country with the highest inflation rate in four decades and growing recession risk, which the Bank of England predicts might persist well into 2024.
According to reports, the UK's ranking decline is the result of the nation's rising cost of living. For the first time since 1982, the nation saw double-digit consumer price inflation last month. With the pound losing 8% versus the rupee this year, sterling has underperformed the dollar relative to the Indian currency. In the second quarter, UK GDP increased by just 1% in real terms; after accounting for inflation, it decreased by 0.1%.
Indian equities have recently had a global-beating recovery, moving their weighting into second place in the MSCI Emerging Markets Index, only behind China's.
official figures revealed that India's gross domestic product (GDP) increased 13.5% in the June 2022 quarter (Q1FY23), as opposed to the 20.1% growth recorded in the first quarter of 2021–2022. According to an official statement, "Real GDP or gross domestic product (GDP) is anticipated to hit a level of Rs 36.85 lakh crore in Q1 2022-23, as against Rs 32.46 lakh crore in Q1 2021-22, indicating a rise of 13.5 percent as opposed to 20.1 percent in Q1 2021-22."According to National Statistical Office (NSO) figures, the country's gross value added (GVA), which is GDP less net product taxes and shows supply growth, increased by 12.7% between April and June 2022.
Reduced corporate taxes, the production-linked incentive (PLI) program, and India as a potential supply chain beneficiary all helped to stimulate and maintain domestic demand, particularly for investments.
India's GDP grew by 13.5% in the first quarter of FY23. India's GDP is probably going to develop the quickest in the current fiscal year at this rate. Nirmala Sitharaman, the Union Finance Minister, has disclosed that India's Gross Domestic Product (GDP) growth will continue to grow at 7.4% in FY 2022–23 and in FY24 as well.
However, economists worry that the prospect of a global recession and rising interest rates might stifle growth in the ensuing quarters.
A variable monsoon is also expected to have an impact on rural demand and agricultural growth. Economists are also said to be concerned about the manufacturing sector's decreasing growth rate of 4.8% and the fact that imports are outpacing exports.
India is expected to benefit in the coming days as China's aspirations for fresh investments slow down.
Despite its great economic progress, the country nonetheless has its share of obstacles. According to the World Bank, access to development and new opportunities has been unequal and varies by area.
Furthermore, India is home to 25% of the world's poor. According to the UN, just 39% of its rural populations have access to sanitary facilities, and nearly half of the population still defecates in the open.
Although India overtook the UK there is a disparity in per capita income between the two countries caused by the size of India's population India has 1.3 billion inhabitants, which is three times the combined populations of the UK, France, Italy, and Brazil, vs the UK which has a population of 068 bn. Thus, our per capita GDP was $2,500 as opposed to $47,000. We still have much to go.
The semiconductor industry was put into the unexpected limelight in 2021 when chip shortages initially forced the shutdown of vehicle production lines. The focus grew when certain high-tech and consumer electronics businesses started to report chip shortages or expressed worries about supply chains.
Everyone can clearly see that we live in a world dominated by semiconductors, the small chips that power several automotive features, including blind-spot detection, seat adjustment, and interior Illumination.
Relations between Washington and Beijing are strained as a result of the rising tensions brought on by the visit of Nancy Pelosi, the speaker of the US House of Representatives.
Some scholars claim that if China conquers Taiwan, the former will gain more independence to expand its strength throughout the western Pacific.
Furthermore, China may put the American military outposts in jeopardy if this takeover occurs, especially those on the island regions.
China, however, disputes any bad intentions and insists that its goals are wholly benign. But President Xi Jinping of China declared that "reunification with Taiwan must be realized" and that if necessary, the force will be used to achieve this goal.
Simply put, the dragon views the island country as a renegade province that the latter seeks to subdue.
Washington has a history of strategic ambiguity, to the point where it might use force to intervene if China invaded Taiwan. The One-China policy, which recognizes only one Chinese government, based in Beijing, and has formal links with Beijing rather than Taipei, is adhered to by this country in its official capacity. It has, however, also promised to give Taiwan protective armaments and emphasized that any invasion by China would be of great concern.
A significant portion of Taiwan's IT sector is made up of the semiconductor industry, which includes IC manufacture, design, and packing. Taiwan plays a significant role in the semiconductor industry's worldwide supply chain.
Additionally, its contract manufacturers represented more than 60% of the entire income generated by semiconductors worldwide in 2021.
Around 20% of the world's semiconductor market, or US$115 billion, was accounted for by Taiwan. Taiwanese businesses control 50% of the global market in some industries, such as foundry operations, with Taiwan Semiconductor Manufacturing Company (TSMC) dominating the foundry industry.
Taiwan manufactures essential semiconductors and electronic equipment and controls 10% of the world's shipping container capacity, holding a crucial role in the global supply chain.
Technology companies from Taiwan control the majority of the world's capacity for producing semiconductors, including cutting-edge and effective chips. The largest contract chip manufacturer in the world, Taiwan Semiconductor Manufacturing Co Ltd (TSMC), is now investing in a new $12 billion facility in Arizona.
India has its own limitations, therefore it won't participate more politically in Taiwan unless the situation is dire. Since the beginning, India has adhered to a "One China" policy; yet, India must recognize that Taiwan is the main center of the American Indo-Pacific strategy. In the bigger picture of limiting China, it does play a significant supporting role.
Our links now extend beyond commerce to include educational possibilities for Indians who wish to learn Chinese and follow Chinese trends.
The COVID-19 epidemic and China's zero-COVID policy have already caused unprecedented amounts of disruption in supply chains throughout the world since 2020.
Due to trade and supply route restrictions brought on by the Russia-Ukraine war, shipping prices have increased.
A blockage or delay in semiconductor chip exports might be one of the numerous effects of a confrontation between China and Taiwan. This would have an impact on several global businesses, including manufacturing, internet communications technology (ICT), and research and development.
The Taiwan Strait is one of the busiest shipping lanes in the world, helping the transport of technology and natural gas supplies to international markets.
A butterfly effect might result in hyperinflation, job losses when factories stop operating, and recessionary economies.
State Bank of India's net profit in the first quarter of the current financial year on a standalone basis has declined by 7 percent.
State Bank of India (SBI) reported a net profit of Rs 6,068.08 crore compared with Rs 6,504 crore in the same quarter last year. Due to Mark to Market (MTM) losses on its investment book, the bank's operating profit decreased by 33% to Rs 12,753 crore from Rs 18,975 crore in the April-June quarter of the previous fiscal.
The bank's interest income increased to Rs 72,676 crore from Rs 65,564 crore previously. Net interest income grew from Rs 27,638 crore in the first quarter of the previous fiscal to Rs 31,196 crore which is 12.87 percent. The net interest margin increased from 3.15 to 3.23 percent.
Core operating profit jumped by 14.39 percent year over year, from Rs 16,873 crore in Q1 FY22 to Rs 19,302 crore in Q1 FY23, when trading income and MTM were excluded.
The bank's gross (NPA) ratio increased from 5.32 percent at June's end of the previous year to 3.91 percent today. Similar to this, net NPAs decreased from 1.7% in June 2021 to 1.02 in June 2022. Domestic NIM for Q1FY23 climbed by 8 bps YoY to 3.23 percent. While the net NPA ratio decreased by 77 bps YoY to 1.00 percent, the gross NPA ratio decreased by 141 bps YoY to 3.91 percent.
The Provision Coverage Ratio (PCR), which was 75.05 percent, increased by 719 bps YoY. A 90.14 percent PCR (Inclusive AUCA) was reported. The slippage ratio for the reviewed quarter was 1.38 percent, an improvement of 109 bps year over year. Corporate loan volume increased by 10.57%, while SME and agricultural loans also saw year-over-year increases of 10.01% and 9.82%, respectively.
Deposit increased by 8.73% to Rs. 40 lakh crore. As of June 30, the bank's CASA ratio dropped 64 basis points to 45.33 percent. Retail bank deposits are up 8.73% year over year. Credit Cost for Q1 FY23 was 0.61 percent, up 18 basis points year over year. At the end of the June quarter of 2022–23, the capital adequacy ratio (CAR) was 13.43%.
SBI added that 38% of retail asset accounts and 65% of savings bank accounts were opened online using YONO. The proportion of alternate channels in all transactions climbed from 95.1% in the first quarter of FY22 to 96.6 in the first quarter of FY23.
Due to Mark to Market (MTM) losses on its investment book, the bank's operating profit decreased by 33% to Rs 12,753 crore from Rs 18,975 crore in the April-June quarter of the previous fiscal.
The bank's Return on Asset and Return on Equity, which was 0.48 percent and 10.09 percent, respectively, suffered from the MTM hit.
Non-interest income fell significantly. The sharp reduction in SBI's non-interest income was a significant factor in the company's profit decline. In the June quarter, SBI's non-interest income was barely Rs 2,312 crore, compared to Rs 11,802 crore in the same quarter of the prior fiscal year.
Talking about the stock of SBI, the company's stock has given a return of 13 percent to the investors in YTD time. At the same time, it has given a return of 22.20 percent in the last year and has given a return of 90.02 percent to the investors in the last 5 years.
Promoter ownership of SBI was 57.57 percent as of June 2022, with no shares pledged.
Dividends of Rs 07.10 per share have been issued by SBI for the fiscal year that ended in March 2022.
SBI's share price increased by 84.45, or around 19.38 percent, during the course of the past year, from Rs 435.7 to Rs 520.1.
At 43,884.2, the S&P BSE BANKEX Index is now trading (up 0.77 percent). It increased by 3,153.0 points (up 7.74 percent) in the past year, from Rs 40,731.3 to Rs 43,884.2.
The S&P BSE SENSEX has increased 8.25% overall.
As we observe our nation's 75th Independence Day, let's review how freedom has changed through time.
For India's savings, a route to financial independence has been gradually carved out thanks to the efforts of governments, regulators, and financial institutions. This route capitalizes on the country's economic expansion using share markets, mutual funds, and other investment avenues that let investors reap from it.
Certain reasons have led to a rise in the importance of financial independence. Every middle-class individual should take into consideration this idea because it is no longer optional and almost a necessity.
To become financially free, one must plan ahead and handle their existing finances. It's crucial to organize your expenses and debts since doing so will allow you to start saving and stop depending on a set monthly salary.
The road to financial independence begins there. The sooner you start saving, the longer you save will eventually benefit you in long term. It makes no difference where you start, but it is more crucial that you begin making plans for the future.
Just as important as choosing a financial objective is understanding one's risk tolerance level. One may easily narrow down the most worthwhile investment possibilities if they are aware of their level of risk tolerance. Financial decisions may become murky if one is unable to identify their personal risk tolerance.
Most people will accumulate wealth more reliably by combining tiny sums of money with time and the power of compound interest.
Choosing a variety of investments that are geared toward attaining your goals and objectives at an investment risk level that you are comfortable with is the key to building an investment portfolio. The selection of a particular investment is the second most important component after asset allocation.
Regular and systematic investing is required if you want to get the desired outcomes. A powerful feature for goal planning is a systematic investment plan (SIP). You only need to choose one of the top and most suitable mutual fund programs to SIP into.
Searching for the best mutual funds for a systematic investment plan in India? Fulfill your financial goals now with Swastika.
Equity investments have rewarded investors by increasing their money in a fairly short amount of time when compared to other investment alternatives. By starting early, and making investments in the right stocks, one might strive to save enough money to achieve financial independence at a young age.
You must quit living in debt if you want to become financially independent. Make sure to minimize or settle your outstanding bills as soon as you can. Avoid taking out loans or using credit cards frequently to meet your immediate needs because doing so might harm your financial stability
The "4 percent rule" is a retirement rule of thumb that states that an investor can safely withdraw 4 percent, adjusted for inflation, from a balanced portfolio of stocks and bonds each year and be reasonably certain that the money will continue to grow and won't run out. This is how financially independent people who live off their portfolio income operate.
Having the right mindset is essential to achieve financial freedom. Making secure and wise investments is therefore essential to financial independence since it allows you to gradually increase your wealth. Investors who desire predictable capital growth, however, have had sleepless nights due to fluctuating stock indices and monetary policy changes. Fixed-income assets are therefore ideal for investors looking for guaranteed returns.
Trust Our Expert Picks
for Your Investments!
.webp)
.png)
.png)
