Dear Sir, In this issue, we would be discussing on "Why measures taken to control Rupee Volatility are not working?, Which gives you idea about consolidate view on action taken by authorities as well reason to fail such action. Kindly download details from the following link : http://www.youtube.com/watch?v=LPIDnqg2JIQ "Knowledge Plus for Wealth + " will give you the overview of the recent happenings in the financial market. Kindly share your valuable feedback at info@valueplusinv.com to help us serve you better. Thanks & Regards

1. From
Research Desk
VALUE PLUS - The Family Office
KNOWLEDGE PLUS
For Wealth Plus
17th
August - 2013

2. Hot Topic of the Week
Knowledge Plus for Wealth +

3. Last week at the Financial Markets!!!
SENSEX fell by 191 points (-1.02%) and closed to 18598 at end of the week.
FII’s remained net buyers in equity segment with inflow of Rs. 447.90 crore
while they stood as net sellers in the debt segment with a net outflow of Rs
466.60 crore.
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News Impact
• RBI announced fresh measures by
tightening overseas investment limits
for Indian companies and individuals.
• Process of Merger and Acquisition by
Indian companies will be slow
• Demand for $ will reduced
• FII’s may take exit from their
investments considering this as a capital
control measurement
• Rupee hits all time low to 62. • All import items will be costlier
• Current account deficit will widen
• Textile, Diamond, IT sectors will be
beneficiaries
• Exporters will be more competitive in
the international markets

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Price Performance of Different Asset Class
High Volatility was
seen in all financial
markets .
High Volatility was
seen in all financial
markets .
Last week at the Financial Markets!!!

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Government may impose duty on imports of solar
equipments.
NSEL’s settlement will start on 20th
August, 2013.
Next Week in the Financial Markets...?

6. Hot Topic of the Week
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7. Knowledge Plus for Wealth +
1. Hiked import duty on Gold
Government increased import duty on Gold from 8% to 10%
We believe this measure has worked to some extent.
But positive impact was nullified by higher international gold
and crude price.
Brent Crude Price

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RBI’s intervened in Forex market by selling dollar from PSU banks
RBI took action on currency derivative market to curb speculative
positions
2. Intervention in Forex Market
We believe Demand and Supply was the major factor
behind rupee depreciation instead of speculation.

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3. Change In Interest Rate Policy
10 year G-Sec
-India -US
RBI raised cost of borrowing of banks by 2%
Increase in daily limit of Cash reserves ratio of the bank
Hike in US G-Sec yields made India's G-sec yield
unattractive. So, FII’s out flow in debt market may
continue.

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4. Increase in FDI limits and liberalisation
of ECB guidelines
• Government increased FDI limits in sectors like telecom, insurance & defense.
• Subsidiaries of MNC’s have been allowed to raise money from their parent
companies.
• The limit of overseas direct investment for companies (under automatic route)
reduced from 400% to 100% of their net worth.
• Reduced the limit for remittance for individuals from $2,00,000 to $75,000
We believe this measure will work in the long run. So, it is
not able to control short term volatility.
High interest rates, declining business & consumer
confidence as well as unstable political environment will
resist FDI to invest in India.

11. Knowledge Plus for Wealth +
Research Desk
VALUE PLUS - The Family Office
Office: (0265 -2324600,6629800)
Email: info@valueplusinv.com
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