India’s real GDP to grow at around 9.5 per cent in FY22

India’s real GDP is expected to grow at around 9.5 per cent in 2021-22 on a year-on-year (YoY), an SBI Ecowrap report said on Saturday.

The report comes a day after the National Statistical Office (NSO) released the First Advance Estimates of National Income for financial year 2021-22.

Accordingly, the estimates had said that India’s economy is expected to clock a growth of 9.2 per cent in terms of real GDP for FY22.

The NSO data had indicated that Real GDP’ or ‘GDP at Constant Prices’ (2011-12) in the year 2021-22 rose to Rs147.54 lakh crore from Rs 135.13 lakh crore, the ‘Provisional Estimate of GDP’ for the year 2020-21. The Ecowrap report said: “We believe that NSO’s estimate is on the conservative side, as the calculated GDP growth for H2FY22 for construction comes at (-) 0.9 per centa Services is at a mere 2 per cent for H2FY22.

“We still believe that real GDP will grow at around 9.5 per cent in FY22. Meanwhile, this estimate however has a shelf-life of only two months and is only used as an input for budget arithmetic.” Besides, the report said that the NSO will release the first revised estimate of FY19, FY20 and FY21 on 31 Jan’21.

“We believe that for FY22 the figures would be revised again in February’21 and May’21.” As per the report, going forward, even if the rising Covid infections could impact mobility, yet economic activity is not expected to get affected much.

“Cases have been rising significantly in India as well as across the globe. However, studies so far reveal that the current Omicron variant is less severe than the Delta variant. Data also substantiates this fact,” the report said.

“While number of new cases increased from 1.3 crore in October’21 to almost double to 2.5 crore in December’21 the number of deaths remained constant (just 2,200 more deaths occurred in Dec as compared to Oct).” In addition, the report said that taking into account the revised GDP figures, “even if we consider the additional spending announced by the government in early Dec’21 fiscal deficit of the government still comes at Rs15.88 lakh crore or 6.8 per cent of the GDP”. “For FY23, the fiscal consolidation should remain limited to 30-40 bps from the current fiscal.”

Some penny stocks or low-priced stocks scaled new highs or went up in straight trading sessions this week in an otherwise volatile broader market.

Innumerable counters are moving up without logic, many defying fundamentals and eluding the eyes of the regulator and the exchanges. It remains regulator SEBI and the exchanges incumbent duty to retain oversight through stringent surveillance and scrutiny mechanisms.

Sadly, this doesn’t seem to be happening, for the old adage of a ‘rising tide lifting all boats’ seems to be the underlying credo for this unidirectional rise. This is where SEBI needs to be in action mode in order to sift the wheat from the chaff. This process of winnowing is crucial to curtail the needless froth driven to the top by operators and punters, who are clearly in some cases working in collusion with some of these companies.

Indo Asian News Service undertook an investigation into some of these counters and listed them out so that the regulator and exchanges swing in to cut the fat and bring a semblance of order in the equity markets. And this remains a recurring theme right through the robust bull market, counters hitting upper circuit filters, and common retail investors being denied the opportunity to purchase many of these penny stocks.

It is this collusion between operators fronting for certain promoters which is creating this distortionary trend in the market. Many market analysts maintain that this emergent trend line may well be part of a circular trading operation where a cabal of operators resort to pump and dump.

Pump and dump is a well-known system of price rigging and manipulation when identical buy and sell orders are entered at the same time with the same number of shares and the same price. Try buying one of these shares at precisely 9.15 am and one will find that it has already hit the upper or lower circuit for the day. This is being done in a brazen manner in complete contravention of SEBI and exchange rules and regulations.

In the last 18 months since the onset of Covid 1, markets have moved up dramatically from 24,000-odd levels to close to 62,000 on the BSE Sensex and many penny stocks have seen this operation undertaken without so much as by your leave.

It is probably time for the nodal authority in North Block -- Joint Secretary Capital Markets in Finance Ministry -- to begin a probe into price rigging and manipulation, which is being done shamelessly right under the noses of the regulatory authorities.

The latest lot of those who appear to be cocking a snook are Jet Freight Logistics which hit a 52-week high of Rs62.45 on BSE on Jan.7, up 4.96 per cent. It has been rising consistently in the last few trading sessions. On January 3, it was at Rs 49.95 and ended Jan.7 at Rs62.45. It needs to be mentioned that all these companies listed here may not necessarily be involved in pump and dump schemes, but circumstantial and prima facie deep dive has clearly revealed a pattern of malafide as counters are being propped up using news driven data points.