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New Delhi: Steel companies in the country are likely to face margin pressure in the third quarter of FY25 as muted steel prices compress spreads, according to a report by Axis Securities. The report stated that the weak demand in China and higher exports from the country have been identified as key factors behind the decline in steel prices. The report highlighted that <keyword id="24048830" type="General" weightage="20" keywordseo="Chinese-steel-exports" source="keywords">Chinese steel exports</keyword> reached 92 million tonnes per annum (MTPA) between January and October 2024, marking a 22 per cent year-on-year increase. This has led to an oversupply in the global market, weighing down prices domestically. It said "Weak Chinese domestic demand along with higher Chinese exports has led to a decline in steel prices in India. Chinese steel exports from Jan'24 to Oct'24 stood at 92 MTPA, up 22 per cent YoY" In India, the average price of hot-rolled coil (HRC) steel in the trader's market in Mumbai fell by 8 per cent year-on-year and 6 per cent quarter-on-quarter to Rs 51,802 per tonne in the second quarter of FY25. Spot prices have further declined to Rs 49,000 per tonne, 5 per cent lower than the Q2FY25 average. The report also noted some signs of recovery in China's residential property sector, with increased transactions in major cities following policy measures aimed at boosting demand. However, challenges remain, as the three-month moving average of year-to-date floor space declined by 19 per cent year-on-year in September 2024, remaining in negative territory. It said "China's residential property sector is showing some signs of improvement with the transactions in major cities rising after recent policy measures introduced to boost demand". On the global front, the report noted that the probability of a 25-basis point rate cut by the US Federal Reserve in its December 2024 meeting has fallen to 58.9 per cent, down from 76.8 per cent in October 2024, owing to strong economic data from the US. Additionally, China has removed a 13 per cent export rebate on aluminum and copper, effective December 1, 2024, in response to anticipated tariff measures by the new US administration. These developments highlight the ongoing challenges and potential shifts in the global and domestic steel and metals markets.

Falling steel prices amid Chinese export surge, to reduce profits of companies in Q3 FY25: Report

Over the past few months, there’s been a lot of brouhaha about the lagging pace of bank deposits in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialization of household savings in the country, or the rising preference of Indians towards mutual funds and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian equity markets through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="rbi" source="keywords">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by <keyword id="20250971" type="General" weightage="20" keywordseo="franklin-templeton" source="keywords">Franklin Templeton</keyword>, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are <keyword id="4000333" type="General" weightage="100" keywordseo="household-deposits" source="Orion">household deposits</keyword> really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. Also, we can’t forego the fact that the share of Indian <keyword id="20319599" type="General" weightage="20" keywordseo="households" source="keywords">households</keyword> in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and savings account deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (<keyword id="19942037" type="General" weightage="20" keywordseo="central-board-of-direct-taxes" source="keywords">Central Board of Direct Taxes</keyword>) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of <keyword id="20930760" type="General" weightage="20" keywordseo="securities-transaction-tax" source="keywords">Securities Transaction Tax</keyword> (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell equity mutual funds, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by equities can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in deposit growth we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the <keyword id="19900043" type="General" weightage="20" keywordseo="fed" source="keywords">Fed</keyword> recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next <keyword id="19918491" type="General" weightage="20" keywordseo="mpc" source="keywords">MPC</keyword> (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day.

A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

<ul class="summary-list"><li>In March, <a href="https://markets.businessinsider.com/news/currencies/crypto-heist-axie-infinity-hackers-north-korea-stole-620-million-fbi-2022-4">North Korea-linked hackers stole $620 million in crypto</a> from the online game <keyword id="11971138" type="UNKNOWN" weightage="60" keywordseo="axie-infinity" source="Orion">Axie Infinity</keyword>.</li><li>Scammers tricked an engineer at the company into applying for a fake job, according to <a href="https://www.theblock.co/post/156038/how-a-fake-job-offer-took-down-the-worlds-most-popular-crypto-game?utm_source=newsletter&amp;utm_medium=email&amp;utm_campaign=newsletter_axioscloser&amp;stream=top">The Block</a>.</li></ul>Scammers used an <a href="https://www.theblock.co/post/156038/how-a-fake-job-offer-took-down-the-worlds-most-popular-crypto-game?utm_source=newsletter&amp;utm_medium=email&amp;utm_campaign=newsletter_axioscloser&amp;stream=top">elaborate fake job scheme</a> to steal over $600 million in <keyword id="11893898" type="UNKNOWN" weightage="60" keywordseo="crypto" source="Orion">crypto</keyword> from the online NFT-based game Axie Infinity, The Block reported Wednesday. The hackers, who the <a href="https://markets.businessinsider.com/news/currencies/crypto-heist-axie-infinity-hackers-north-korea-stole-620-million-fbi-2022-4">US Treasury linked to North Korea's notorious Lazarus Group</a>, posed as job recruiters on Linkedin and tricked a senior engineer at the game's developer, Sky Mavis, into going through "multiple rounds of interviews" for a position that did not exist, sources told the outlet. They then sent the engineer a fabricated offer letter with "an extremely generous compensation package" that was laced with spyware, The Block reported. Once downloaded, the hackers could access Axie Infinity's blockchain network known as "Ronin," where users transferred Ethereum-based digital currencies in and out of the game.The security breach, which the company first disclosed back in March, is believed to be one of the largest crypto heists in the world. However, experts told Insider in April that the <a href="https://markets.businessinsider.com/news/currencies/axie-infinity-hack-ronin-network-crypto-adoption-eth-blockchain-2022-4">cyberattack shouldn't be a deterrent to widespread crypto adoption</a>, as the heist was largely due to human error and a lack of <keyword id="6361948" type="UNKNOWN" weightage="60" keywordseo="cybersecurity" source="Orion">cybersecurity</keyword> rather than a flaw in blockchain technology itself. In May, the US Treasury sanctioned the virtual currency mixer Blender.io, which the department alleged was used to obscure the source of over $20.5 million of the cryptocurrency stolen from Axie Infinity. "Virtual currency mixers that assist illicit transactions pose a threat to US national security interests," Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson said in a <a href="https://home.treasury.gov/news/press-releases/jy0768">statement</a>. "We are taking action against illicit financial activity by the DPRK and will not allow state-sponsored thievery and its money-laundering enablers to go unanswered."

Hackers pulled off a $620 million crypto heist by tricking an engineer into applying for a fake job and opening an offer letter containing spyware, report says

<ul><li><keyword id="45660" type="CITY" weightage="20" keywordseo="Yes-Bank">Yes Bank</keyword> is looking to raise up to ₹10,000 crore via a follow-on public offer, reports said.</li><li>The FPO will allow Yes Bank to meet its capital requirements, as the troubled bank looks to survive the double blow of the Rana Kapoor money laundering case and the COVID-19 pandemic.</li><li>Going the FPO route allows Yes Bank to avoid borrowing at an increased cost after its AT1 funds were permanently written down by the Reserve Bank of India (RBI).</li></ul>Yes Bank is gearing up to raise up to ₹10,000 crore via a follow-on public offer (FPO). The FPO is scheduled for some time in the first half of June and <keyword id="66607" type="CITY" weightage="20" keywordseo="Kotak-securities">Kotak Securities</keyword>, Axis Cap, SBI Cap and Citi are reported to be amongst the key players. According to a CNBC TV18 <a href="https://twitter.com/CNBCTV18Live/status/1267720275140816896">report</a>, the <keyword id="9332224" type="UNKNOWN" weightage="20" keywordseo="yes-bank-fpo">Yes Bank FPO</keyword> is expected to be in the range of ₹8,000-10,000 crore. This comes after Yes Bank’s losses ballooned to ₹16,418 crore and its deposits worth ₹1.2 lakh crore have vanished. Yes Bank’s Managing Director and Chief Executive Officer Prashant Kumar told Livemint in May that the bank is looking to raise up to ₹10,000 crore via FPO, rights issue or qualified institutional placement (QIP). Last month, the Securities Exchange Board of India (SEBI) <a href="https://cfo.economictimes.indiatimes.com/news/sebi-eases-funding-norms-for-stressed-companies/75312024">relaxed</a> fundraising restrictions for stressed companies. The relaxation was in the form of reduced minimum subscription requirements – from the 90% required earlier, this has <a href="https://twitter.com/CNBCTV18Live/status/1267720275140816896">reportedly</a> been reduced to 50% now. The beleaguered bank has seen its shares plummet from ₹393 in August 2019 to an all-time low of ₹5.65 in March 2020. The bank’s shares tumbled when <a href="https://www.businesstoday.in/markets/company-stock/yes-bank-share-price-loses-30-after-rbi-takes-over-private-lender/story/397676.html">news broke</a> that the Reserve Bank of India (RBI) was taking over. The bank’s managing director at the time, Rana Kapoor, is currently <a href="https://www.businessinsider.in/business/news/the-fall-of-yes-bank-founder-rana-kapoor-from-a-billion-dollars-to-facing-a-4300-crore-investigation/articleshow/74547669.cms">being investigated</a> for money laundering to the tune of ₹4,300 crore. What is an FPO? FPO, short for follow-on public offer, is a subsequent issuance of shares to the public, after the initial public offer (IPO). FPOs are generally undertaken to either raise equity or reduce debt. Yes Bank going the FPO route is likely a result of the bank’s AT1 bonds being written down by the Reserve Bank of India (RBI). As a result of this writedown, there were <a href="https://economictimes.indiatimes.com/markets/stocks/news/yes-bank-debt-writedown-to-hit-sector-capital-raising/articleshow/74547131.cms">concerns</a> that the overall cost of raising bonds would increase. Going the FPO route allows Yes Bank to raise funds without having to worry about the increased cost of borrowing. SEE ALSO: <a href="https://www.businessinsider.in/business/news/the-fall-of-yes-bank-founder-rana-kapoor-from-a-billion-dollars-to-facing-a-4300-crore-investigation/articleshow/74547669.cms">The fall of Yes Bank founder Rana Kapoor from a billion dollars to facing a ₹4300 crore investigation</a> <a href="https://www.businessinsider.in/finance/news/yes-bank-share-price-net-loss-and-drop-in-deposits-post-q4-earnings/articleshow/75590798.cms">Yes Bank fears more deposits may disappear when COVID-19 moratorium ends and people start repaying loans</a> <a href="https://www.businessinsider.in/business/news/yes-bank-creates-stressed-asset-management-vertical-to-resolve-npa-accounts/articleshow/75601275.cms">Yes Bank creates stressed asset management vertical to resolve NPA accounts</a>

Yes Bank is looking to raise ₹10,000 crore through FPO – with Kotak Securities, Axis Capital, and SBI Capital reportedly to be key players

<ul><li><keyword id="13186004" type="General" weightage="20" keywordseo="metaverse-tokens" source="Orion">Metaverse tokens</keyword> are cryptocurrencies attached to <keyword id="11121339" type="General" weightage="100" keywordseo="metaverse" source="Orion">metaverse</keyword> games.</li><li>Games like <keyword id="12222085" type="General" weightage="20" keywordseo="decentraland" source="Orion">Decentraland</keyword>, <keyword id="1760414" type="General" weightage="20" keywordseo="sandbox" source="Orion">Sandbox</keyword> and more have been doing well in terms of user growth over the past year.</li><li>However, metaverse tokens registered significant drops in the month of May.</li></ul>The crypto market’s bear turn seems to have affected all tokens except those tied to the metaverse arena. According to a <a href="https://kraken.docsend.com/view/scyxnqnb9tf8wqpf">report</a> by Kraken Intelligence, the research arm of crypto exchange Kraken, prices of Metaverse tokens have risen by a whopping 400% year-on-year even as the rest of the market turned for the worse. The report noted that tokens linked to metaverse platforms like Decentraland, Sandbox, <keyword id="11919548" type="General" weightage="20" keywordseo="axie-infinity" source="Orion">Axie Infinity</keyword>, and STEPN, were up by 41%, 470%, 511%, and 746%, respectively, last month. Exchange tokens saw gains of 6% year-on-year too, and became the second category that saw gains despite the market’s downturn. “The #NFT boom of 2021 has not only drawn mainstream attention to digital art investments, it has also popularized the crypto metaverse,” the platform said in a tweet. <div type="twitter" handle="krakenfx" handlename="Kraken Exchange" image="http://pbs.twimg.com/profile_images/1306325743580848130/mk0qvsZ9_normal.jpg" favoritecount="103" retweetcount="36" status="💥 The #NFT boom of 2021 has not only drawn mainstream attention to digital art investments, it has also popularized… https://t.co/JEITScAR6b" createdat="1654617905000" id="1534204810731339776"></div> In comparison, the prices of <keyword id="6354947" type="General" weightage="20" keywordseo="bitcoin" source="Orion">Bitcoin</keyword> were down 13%, while the DeFi category saw a massive drop of 72%, according to the report. BTC fell to a 10-month low in May, while Ethereum dropped by 29% year-on-year, according to the report. That said, the report also pointed out that despite the overall upturn for metaverse games, the segment still posted a drop in May. It said that all sectors posted drops “exceeding 17%”, and metaverse and meme coins led this drop with less than -40% returns from both segments. <cmsannotation type="cmsannotation" annotationid="Why are metaverse tokens performing better?" comment="subhead" text="Why are metaverse tokens performing better?">Why are metaverse tokens performing better?</cmsannotation> Even so, the report is a reminder that crypto tokens that have an utility attached to them have a better chance of weathering the storm and may make for better investments. Tokens like MANA, SAND and others, which are linked to games like Decentraland and Sandbox, are used to buy items within those platforms, and hence have actual utilities attached to them. But that’s not the only reason. Unlike many crypto tokens, which are known to traders only, the metaverse games market is actually popular too. For instance, on April 20, a report by blockchain tracking firm DappRadar <a href="https://dappradar.com/blog/dappradar-x-bga-games-report-q1-2022">noted</a> that blockchain gaming activity has increased by 2000% in the past year. “Game dapps continue their ongoing developments, and the metaverse keeps flashing one of the most exciting opportunities in the blockchain industry. VCs and other investors keep pouring capital into blockchain games and metaverse projects, surpassing $2.5 billion in investments,” the company said in a blog post. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/cryptocurrency/news/around-90-million-users-flocked-to-crypto-bandwagon-in-march-2022-report/articleshow/92081565.cms">Around 90 million users flocked to crypto bandwagon in March 2022: Report</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/investment/news/sebi-raises-concern-on-crypto-says-that-its-decentralised-nature-makes-them-harder-to-regulate/articleshow/92079830.cms">India’s securities regulator says decentralised nature of cryptos makes them harder to regulate</a>

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Falling steel prices amid Chinese export surge, to reduce profits of companies in Q3 FY25: Report

ANI

A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

Ira Alok Puranik

Hackers pulled off a $620 million crypto heist by tricking an engineer into applying for a fake job and opening an offer letter containing spyware, report says

Hannah Towey

Yes Bank is looking to raise ₹10,000 crore through FPO – with Kotak Securities, Axis Capital, and SBI Capital reportedly to be key players

Rounak Jain

Metaverse tokens like Decentraland, Sandbox and Axie Infinity have risen nearly 400% in a year despite the sell-off in crypto market

BI India Bureau

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