Bi-Monthly: India Chartbook

Treasury Research Group

For private circulation only

Domestic growth continues

to be on tenterhooks

Anushri Bansal Yash Panjrath Meghna Ghosh

anushri.bansal@icicibank.com yash.panjrath@icicibank.com meghna.ghosh@ext.icicibank.com
Tel no: +91-22-4008-6220 Tel no: +91-22-4008-8161 Tel no: +91-22-4008-8161
Introduction
• This is the maiden issue of ICICI Bank Research’s Bi-Monthly Chartbook

• India’s growth story has several moving parts often moving in different
directions

• In an attempt to de-code the underlying drivers of growth we look at high

frequency data covering industry, services, rural economy, financial indicators,
inflation metrics, fiscal position and the external sector, and present it in the
form of charts

• We hope it helps capture the essence of the direction in which the Indian
economy is moving over the last couple of months

• All data in this publication is the latest available as on mid-July, 2019

2
Executive Summary
ICICI Bank’s Research proprietary Diffusion Index is showing continued growth slack in
Q1 FY2020, while easing in its Financial Conditions Index could lead to some growth
recovery over the medium term
Mired in tightening lending standards, NBFC stress and, weakening in real estate
and construction activity, industrial slowdown continues

Consumption is seeing a deep demand based slowdown in both urban and rural
areas with terms of trade in agriculture worsening in the wake of weak monsoons

Upward momentum in CPI inflation is driven by food inflation, with moderating

core inflation providing a ceiling to the increase

The Union Budget stuck to fiscal prudence while shying away from growth stimulus

Policy levers of benign inflation, fiscal prudence and accommodative monetary policy
is supporting domestic assets, though pockets of stress remain

Balance of payments ended the year with a mild deficit. We have a positive outlook to
the external sector in FY2020 driven by capital inflows and lower oil prices

3
Industry sector: No respite in sight
Industrial production shows traction however sustainability in Entrenched industrial slowdown visible in core industry imports…
question as other indicators show slowdown

IIP overall Core industry imports

( 3mma, % Y oY) ( 3m m a, % Y oY)
8.0
7.0 25.0
6.0 15.0
5.0
4.0 5.0
3.0 -5.0
2.0 Core industry imports de-growing
-15.0
1.0
0.0 -25.0

Jun-15

Jun-16

Jun-17

Jun-18

Jun-19
Dec-15

Dec-16

Dec-17

Dec-18
Feb-16

Feb-17

Feb-18

Feb-19

Sep-15

Sep-16

Sep-17

Sep-18
Mar-16

Mar-17

Mar-18

Mar-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-16

Aug-17

Aug-18
May-15

May-16

May-17

May-18

May-19
…cargo traffic… …and petroleum consumption

Cargo traffic Petroleum Consumption

( 3mma, % Y oY) ( 3m m a, % Y oY)
20.0 20.0

15.0 15.0

10.0 10.0

5.0 5.0
Cargo traffic growth in May at
0.0 0.0
multi-year lows
-5.0 -5.0
Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18

Jun-15

Jun-16

Dec-16

Jun-17

Dec-17

Jun-18

Dec-18

Jun-19
Dec-15
Aug-15

Aug-16

Aug-17

Aug-18
May-15

May-17

May-18

May-19

Sep-15

Sep-17

Sep-18
May-16

Sep-16

Mar-17

Mar-18

Mar-19
Mar-16
Source: CEIC, PPAC, ICICI Bank Research 4
Services sector: Deep consumption based slowdown
Passenger vehicle sales continue to decline Airport Passenger traffic growth turned negative in April-May

(3 mma, % Y oY) Passenger vehicle sales (3 mma, % Y oY) Airport passenger traffic
30.0 25.0
20.0 20.0
10.0 15.0
0.0 10.0
PV sales de-growing since a year Airport passenger traffic showing a de-growth
-10.0 5.0
af ter 6 years
-20.0 0.0

-30.0 -5.0

Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-17

Aug-18
Aug-16
May-16

May-17

May-18

May-19
May-15
Jun-15

Jun-16

Jun-17

Jun-18

Jun-19
Dec-16

Dec-17

Dec-18
Dec-15
Sep-15

Sep-16

Sep-17

Sep-18
Mar-16

Mar-18

Mar-19
Mar-17
MF equity purchases improved only marginally in June SCBs non-food credit has been moderating since February
(3 mma, INR b n) MF net equity purchases (3 mma, % Y oY) SCBs non-food credit
200.0 16.0
150.0 14.0

100.0 12.0
10.0
50.0
8.0
0.0
6.0
-50.0 4.0
Jun-15

Dec-15

Jun-16

Dec-16

Jun-17

Dec-17

Jun-18

Dec-18

Jun-19
Sep-16

Sep-17

Sep-18
Sep-15

Mar-16

Mar-17

Mar-19
Mar-18

Jun-15

Jun-16

Jun-17

Jun-18

Jun-19
Dec-15

Dec-16

Dec-18
Dec-17
Sep-15

Sep-17

Sep-18
Sep-16
Mar-16

Mar-17

Mar-18

Mar-19
Source: CEIC, ICICI Bank Research 5
Agriculture sector: Adverse terms of trade intensifying
Tractor sales have declined steeply this year Rural wage growth remains subdued

(3 mma, % Y oY) Tr actor sales (3 m m a, % Y oY) Rural wages

50.0
10.0
40.0
9.0
30.0
8.0
20.0
7.0
10.0
6.0
0.0
5.0
-10.0
Tr actor sales growth in Q1 FY20 4.0
-20.0 3.0
slowest in 4 years
-30.0 2.0
Jun-15

Dec-15

Jun-16

Jun-17

Dec-17

Jun-18

Dec-18

Jun-19
Dec-16
Sep-16

Sep-17

Sep-18
Mar-16

Mar-17

Mar-19
Sep-15

Mar-18

Jan-16

Jan-17

Jan-19
Jan-18
Jul-15

Jul-16

Jul-17

Jul-18
Oct-15

Oct-16

Oct-17

Oct-18
Apr-16

Apr-17

Apr-18

Apr-19
Apr-15
India's Kharif sowing was 6.8% lower as compared to the same Cumulative southwest monsoons from 1st to 17th July, 2019 has been
time last year 16% deficient from their Long Period Average(LPA)
Area sow n u n der Kh arif crops
(In lakh h ectare) 19-Ju l-19 20-Ju l-18 % Y oY
Actual rainfall Normal rainfall
Rice 139. 6 154. 2 -9. 4 Region (in mm) (in mm) % departure from LPA
Pu lses 62. 2 74. 0 -15. 9 All India 268.8 318.4 -16%
C oarse C ereals 101. 9 110. 0 -7. 4
Oilseeds 110. 5 119. 0 -7. 1 East & NE 529.9 591.0 -10%
S u garcan e 50. 0 52. 0 -3. 9 Northwest 161.7 183.0 -12%
Ju te & Mesta 6. 8 7. 2 -4. 9
C otton 96. 4 92. 7 3. 9
Central 286.4 338.3 -15%
Total 567. 4 609. 0 -6. 8 South Peninsula 194.8 275.0 -29%
Source: CEIC, Ministry of Agriculture, IMD, ICICI Bank Research 6
Global growth in doldrums and inflation remains muted
Global growth slowdown pulling down commodity prices Trade wars continue to impact global exports

(3 mma, % Y oY) CRB commodity index

20.0
10.0
0.0
-10.0
-20.0
-30.0
CRB commodity index growth has
been negative throughout 2019
-40.0
Jun-15

Jun-16

Jun-17

Jun-18

Jun-19
Dec-15

Dec-16

Dec-17

Dec-18
Sep-15

Sep-16

Sep-17

Sep-18
Mar-17

Mar-18

Mar-19
Mar-16

Global manufacturing sector showing signs of slowdown Global inflation continues to pose downside surprises
Global Inflation surprise indices
PMI manufacturing PMI services US Euro-zone EMs
55 40
30
54
20
53
10
52
0
51 -10
50 -20
49 -30

Feb-19
Jun-18

Jun-19
Dec-18

Jan-19
Nov-18

Mar-19
Jul-18

Sep-18
Aug-18

Oct-18
May-18

Apr-19
Apr-18

May-19
Jun-17

Jun-18

Jun-19
Dec-17

Dec-18
Sep-17

Sep-18
Mar-18

Mar-19

Source: CEIC, Bloomberg, ICICI Bank Research 7

Policy levers support domestic markets but pockets of stress remain
Bond rally supported by fiscal prudence, benign inflation and policy Corporate credit spread increased due to sharp rally in government
accommodation paper

(% ) 10 Year-Gsec (% ) 10-year Spread (Corporate AAA bond - G-sec)

1.5
8.5
1.3
10 yr Gsec yields at lowest
8.0 1.1
level in 22 months
0.9
7.5
0.7
7.0 0.5
0.3
6.5
0.1
6.0 -0.1
Jun-15

Jun-16

Jun-17

Jun-18

Jun-19
Dec-15

Dec-16

Dec-17

Dec-18
Mar-16

Mar-17

Mar-18
Sep-15

Sep-16

Sep-17

Sep-18

Mar-19

Jan-16

Jan-17

Jan-18

Jan-19
Jul-15

Jul-17

Jul-18

Jul-19
Jul-16
Oct-15

Oct-16

Oct-17

Oct-18
Apr-16

Apr-17

Apr-19
Apr-18
Lower crude prices, stable inflation and fiscal prudence are Sovereign credit risk edging towards its lowest
providing support to the Rupee
S BI 5 -y e ar CDS
900
R EER
800
125.0
700
600
120.0
500

115.0 400
300

110.0 200
100
105.0 0
Jun-15

Dec-15

Jun-16

Dec-16

Jun-17

Dec-17

Jun-18

Jun-19
Dec-18
Sep-15

Sep-16

Mar-17

Sep-17

Mar-18

Sep-18

Mar-19
Mar-16

Jul-05

Jul-06

Jul-07

Jul-09

Jul-10

Jul-11

Jul-14

Jul-15

Jul-16

Jul-18

Jul-19
Jul-08

Jul-12

Jul-13

Jul-17
Source: CEIC, Bloomberg, ICICI Bank Research 8
FY2020 unlikely to see major growth recovery

• GDP expectations for FY2020: We revise our estimate of FY2020 growth slightly to ~6.9% on account of
the expected continued industrial and demand slowdown in H1, with Q1 FY2020 growth expected to be
~5.9% YoY. We also expect some revival at the margin in H2 on easing financial conditions and a
favourable base.
• Key factors to monitor would be: Monsoons impacting rural consumption, evolving financial conditions,
trajectory of private capex and crude prices

Source: CEIC, Bloomberg, RBI, Reuters, ICICI Bank Research 9

Appendix
Industrial Sector
 0.0
2.0
4.0
6.0
8.0

-4.0
-2.0
10.0
12.0

0.0
2.0
4.0
6.0
8.0
May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15
( 3mma, % Y oY)

( 3mma, % Y oY)
Feb-16 Feb-16
May-16 May-16
Aug-16 Aug-16
Nov-16 Nov-16
Feb-17 Feb-17

Source: CEIC, ICICI Bank Research

May-17 May-17
Aug-17 Aug-17
IIP basic goods

Nov-17 Nov-17
IIP intermediate goods

Feb-18 Feb-18

May-18 May-18

Aug-18 Aug-18

Nov-18 Nov-18

Feb-19 Feb-19

May-19 May-19
10.0
12.0

4.0

0.0
2.0
6.0
8.0
12.0
16.0

0.0
4.0
8.0

-2.0
-8.0
-4.0

May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15
( 3mma, % Y oY)
( 3mma, % Y oY)

Feb-16 Feb-16
May-16 May-16
Aug-16 Aug-16
Nov-16 Nov-16
Feb-17 Feb-17
May-17 May-17
Aug-17 Aug-17
IIP construction
IIP capital goods

Nov-17 Nov-17
Feb-18 Feb-18
May-18 May-18
Below trend growth in most industrial production components..

Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
12
 10.0
12.0

0.0
2.0
4.0
6.0
8.0
0.0
4.0
8.0

-8.0
-4.0
May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15
( 3mma, % Y oY)

( 3mma, % Y oY)
Feb-16 Feb-16
May-16 May-16
Aug-16 Aug-16
Nov-16 Nov-16
Feb-17 Feb-17

Source: CEIC, ICICI Bank Research

May-17 May-17
Aug-17 Aug-17
IIP manufacturing
IIP durables goods

Nov-17 Nov-17
Feb-18 Feb-18
May-18 May-18
Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
-2
-1

-4
-3
3

0
1
2
4
15.0
18.0

12.0

6.0

0.0
3.0
9.0

-3.0

May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15
( 3mma, % Y oY)

Feb-16 Feb-16
(3 mma, % MoM)

May-16 May-16
Aug-16 Aug-16
..with output of consumption goods weakening…

Nov-16 Nov-16
s.a

Feb-17 Feb-17
May-17 May-17
Aug-17 Aug-17
IIP manufacturing

Nov-17
non s.a

Nov-17
IIP non-durables goods

Feb-18 Feb-18
May-18 May-18
Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
13
 10.0

12.0
14.0

10.0
0.0
2.0
4.0
6.0
8.0

0.0
6.0

2.0
4.0
8.0
-4.0
-2.0
May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15

( 3mma, % Y oY)
( 3mma, % Y oY)

Feb-16 Feb-16
May-16 May-16
Aug-16 Aug-16
Nov-16 Nov-16
Feb-17 Feb-17

Source: CEIC, ICICI Bank Research

May-17 May-17
IIP mining

IIP electricity
Aug-17 Aug-17
Nov-17 Nov-17
Feb-18 Feb-18
May-18 May-18
Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
-5
10
-6
-2
10

0
5
2
6

-10

May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15
Feb-16 Feb-16
(3 mma, % MoM)
(3 mma, % MoM)

May-16 May-16
Aug-16 Aug-16
…while mining and electricity provide some relief

Nov-16 Nov-16
s.a
s.a

Feb-17 Feb-17
May-17 May-17
IIP mining

Aug-17 Aug-17
IIP electricity

Nov-17 Nov-17
non s.a
non s.a

Feb-18 Feb-18
May-18 May-18
Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
14
 10.0
25.0

15.0
20.0

0.0
5.0

-25.0
-15.0
-20.0
-10.0
-5.0
50.0

-100.0
0.0
-50.0
100.0
150.0
200.0

Jun-15
Jun-15
( US D mn )

Sep-15 Sep-15
Dec-15 Dec-15

( 3mma, % Y oY)
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 Exports Jun-17
Trade Balance

Sep-17 Sep-17
Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19

Jun-19 Jun-19
-5
10

0
5

-10
15.0
25.0

5.0

-25.0
-15.0
-5.0

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
( 3mma, % Y oY)

Mar-16
(3 mma, % MoM)

Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
s.a

Mar-17 Mar-17
Jun-17 Jun-17
Exports

Sep-17 Sep-17
Dec-17
non s.a

Dec-17
Core industry imports

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Trade deficit narrowed with headwinds from weakening global trade..

Jun-19 Jun-19
15
 10.0
40.0
50.0

20.0
30.0

0.0

35.0

15.0
25.0
-20.0
-10.0

5.0

-15.0
-5.0
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
( 3mma, % Y oY)

( 3mma, % Y oY)
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 Jun-17
Sep-17 Sep-17
Non oil imports

Dec-17 Dec-17
Non-oil non-gold imports

Mar-18 Mar-18
Jun-18 Jun-18
..as well as domestic demand

Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
-6
-2
10

2
6

-10
-6
-2
10

2
6

-10

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16 Mar-16
(3 mma, % MoM)
(3 mma, % MoM)

Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
s.a
s.a

Mar-17 Mar-17
Jun-17 Jun-17
Sep-17 Sep-17
Non oil imports

Dec-17 Dec-17
non s.a
non s.a

Non-oil non-gold imports

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
16
 5.0

1.0
3.0
7.0

-5.0
-1.0
-3.0
10.0
15.0
20.0

0.0
5.0

-5.0
Jun-15 May-15
Sep-15 Aug-15
Dec-15 Nov-15
( 3mma, % Y oY)

( 3mma, % Y oY)
Mar-16 Feb-16
Jun-16 May-16
Sep-16 Aug-16
Dec-16 Nov-16
Mar-17 Feb-17

Source: CEIC, ICICI Bank Research

Jun-17 May-17
Cargo traffic

Sep-17 Aug-17
Fr eight originating

Dec-17 Nov-17
Mar-18 Feb-18
Jun-18 May-18
Sep-18 Aug-18
Dec-18 Nov-18
Mar-19 Feb-19
Jun-19 May-19
-6
-4
-2
0
2
4
6
-2

-6
-4
6

0
2
4
8

Jun-15 May-15
Sep-15 Aug-15
Dec-15 Nov-15
Mar-16 Feb-16
(3 mma, % MoM)
(3 mma, % MoM)

Jun-16 May-16
Sep-16 Aug-16
Cargo and rail freight seeing continued weakness..

Dec-16 Nov-16
s.a
s.a

Mar-17 Feb-17
Jun-17 May-17
Sep-17 Aug-17
Cargo traffic

Fr eight originating

Dec-17
non s.a

Nov-17
non s.a

Mar-18 Feb-18
Jun-18 May-18
Sep-18 Aug-18
Dec-18 Nov-18
Mar-19 Feb-19
Jun-19 May-19
17
 10.0

0.0
5.0

-15.0
-10.0
-5.0

15.0
20.0

10.0

0.0
5.0

-15.0
-10.0
-5.0
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
( 3mma, % Y oY)

( 3mma, % Y oY)
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 Coal freight Jun-17
Sep-17 Sep-17
Rail traffic freight

Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
..spread across commodities

Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
10.0
15.0
20.0
25.0

0.0
5.0

-15.0
-10.0
-5.0

10.0
20.0
30.0

0.0

-10.0

Jun-15 Jun-15

Sep-15 Sep-15
Dec-15 Dec-15
( 3mma, % Y oY)

( 3mma, % Y oY)

Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17
Jun-17 Jun-17
Sep-17 Sep-17
Cement freight

Pig iron freight

Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
18
 10.0
15.0

0.0
5.0

-5.0
20.0
65.0
80.0

35.0
50.0

5.0

-25.0
-10.0
May-15 Jun-15
Aug-15 Sep-15
Nov-15 Dec-15
( 3mma, % Y oY)

( 3mma, % Y oY)
Feb-16 Mar-16
May-16 Jun-16
Aug-16 Sep-16
Nov-16 Dec-16
Feb-17 Mar-17

Source: CEIC, ICICI Bank Research

May-17 Jun-17
Aug-17 Sep-17
Nov-17 Dec-17
Cr ude steel production

Feb-18 Mar-18
production saw marginal uptick

May-18 Jun-18
Commercial vehicle production

Aug-18 Sep-18
Nov-18 Dec-18
Feb-19 Mar-19
May-19 Jun-19
-5
20

10
15

5
0

-15
-10

-1

-3
-2
0
4

1
2
3
5

May-15 Jun-15

Aug-15 Sep-15

Nov-15 Dec-15

Feb-16 Mar-16
(3 m m a, % M oM)

(3 mma, % MoM)

May-16 Jun-16

Aug-16 Sep-16
Nov-16 Dec-16
s.a

s.a

Feb-17 Mar-17
May-17 Jun-17
Aug-17 Sep-17
Dec-17
non s.a

Nov-17
non s.a
Cr ude steel production

Feb-18 Mar-18
Commercial vehicle production

May-18 Jun-18
Aug-18 Sep-18
Commercial vehicle production continued to decline; while crude steel

Nov-18 Dec-18
Feb-19 Mar-19
May-19 Jun-19
19
 10.0
15.0

0.0
5.0

-5.0

10.0
15.0

0.0
5.0

-5.0
Jun-15
Jun-15
Sep-15
Sep-15
Dec-15 Dec-15
( 3mma, % Y oY)

Mar-16

( 3mma, % Y oY)
Mar-16
Jun-16 Jun-16

Sep-16 Sep-16

Dec-16 Dec-16

Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 Jun-17

Sep-17 Sep-17
Electricity demand

Dec-17 Dec-17
Electricity generation

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
-6
-5

-4
-2
10
10

2
4
0
5

0
6
8

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16 Mar-16
(3 mma, % MoM)
(3 mma, % MoM)

Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
s.a
s.a

Mar-17 Mar-17
Jun-17 Jun-17
Electricity demand and generation saw uptick in June..

Sep-17 Sep-17
Electricity demand

Dec-17 Dec-17
non s.a
non s.a

Electricity generation

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
20
 10.0
15.0
20.0

0.0
5.0
10.0
15.0
20.0

-10.0
0.0
5.0

-5.0
-10.0
-5.0
May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15

( 3mma, % Y oY)
( 3mma, % Y oY)

Feb-16 Feb-16
May-16 May-16
Aug-16 Aug-16
Nov-16 Nov-16
Feb-17 Feb-17
May-17 Coal Offtake May-17

Source: Coal India, ICICI Bank Research

Aug-17 Aug-17
Coal Production

Nov-17 Nov-17
Feb-18 Feb-18
May-18 May-18
Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
-5
15
10
20

0
5

-15
-10

-5
10
15

0
5

-10

May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15
..while coal production and offtake declined..

Feb-16 Feb-16
(3 mma, % MoM)

(3 mma, % MoM)

May-16 May-16
Aug-16 Aug-16
Nov-16 Nov-16
s.a

s.a

Feb-17 Feb-17
May-17 May-17
Coal offtake

Aug-17 Aug-17
Coal production
non s.a

Nov-17 Nov-17
non s.a

Feb-18 Feb-18
May-18 May-18
Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
21
 20.0

10.0
15.0

0.0
5.0

-5.0

20.0

10.0
15.0

0.0
5.0

-5.0
Jun-15 May-15
Sep-15 Aug-15
Dec-15 Nov-15

( 3mma, % Y oY)
( 3mma, % Y oY)

Mar-16 Feb-16
Jun-16 May-16
Sep-16 Aug-16
Dec-16 Nov-16
Mar-17 Feb-17

Source: PPAC, ICICI Bank Research

Jun-17 May-17
Sep-17 Aug-17
Dec-17 Nov-17
Petroleum Production

Petroleum Consumption

Mar-18 Feb-18
Jun-18 May-18
Sep-18 Aug-18
Dec-18 Nov-18
Mar-19 Feb-19
Jun-19 May-19
-6
-2

-4
-2
-6
-4

2
8
6

0
4
6
0
2
4
8

Jun-15 May-15
Sep-15 Aug-15
Dec-15 Nov-15
Mar-16 Feb-16
(3 mma, % MoM)
(3 mma, % MoM)

Jun-16 May-16
..so did petroleum production and consumption

Sep-16 Aug-16
Dec-16 Nov-16
s.a
s.a

Mar-17 Feb-17
Jun-17 May-17
Sep-17 Aug-17
Dec-17 Nov-17
non s.a
non s.a
Petroleum production

Petroleum consumption

Mar-18 Feb-18
Jun-18 May-18
Sep-18 Aug-18
Dec-18 Nov-18
Mar-19 Feb-19
Jun-19 May-19
22
PMI manufacturing has seen below trend expansion; decline in cement
production a cause of worry
PMI manufacturing (3 mma, % Y oY) Cement production
56.0 25.0
20.0
54.0 15.0
52.0 10.0
5.0
50.0 0.0
48.0 -5.0
-10.0
46.0 -15.0
Feb-17

Feb-18

Feb-19
Jun-16

Dec-16

Jun-17

Dec-17

Jun-18

Dec-18

Jun-19
Aug-16

Aug-17

Aug-18
Oct-16

Oct-17

Oct-18
Apr-17

Apr-19
Apr-18

Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-17

Aug-18
Aug-16
May-15

May-16

May-17

May-18

May-19
Source: Bloomberg, CEIC, ICICI Bank Research 23
Services
 10.0
20.0
30.0

40.0
60.0

20.0
0.0

0.0
-30.0
-20.0
-10.0

-20.0
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
(3 mma, % Y oY)

(3 mma, % Y oY)
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 Jun-17
Sep-17 Sep-17
Dec-17 Dec-17
Passenger vehicle sales

Commercial vehicle sales

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
-5
15
10
20

5
0

-15
-10

-5
15
10
20

5
0

-15
-10

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16
(3 mma, % MoM)

Mar-16
(3 mma, % MoM)

Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
s.a

s.a

Mar-17 Mar-17
Jun-17 Jun-17
Auto sector is seeing a deep demand based slowdown..

Sep-17 Sep-17
Dec-17
non s.a

Dec-17
non s.a
Passenger vehicle sales

Commercial vehicle sales

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
25
 25.0

15.0
35.0

5.0

-15.0
-5.0

25.0
50.0
75.0

0.0

-50.0
-25.0
100.0
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15

(3 mma, % Y oY)
(3 mma, % Y oY)

Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 Jun-17
Sep-17 Sep-17
Two wheeler sales

Three wheeler sales

Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
10
20

-30
-20
-10

10
20

-20
-10

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
..across segments and rural and urban areas

Mar-16 Mar-16
(3 mma, % MoM)

(3 mma, % MoM)

Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
s.a

s.a

Mar-17 Mar-17
Jun-17 Jun-17
Sep-17 Sep-17
Two wheeler sales

Dec-17 Dec-17
non s.a

non s.a
Three wheeler sales

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
26
 10.0
15.0
20.0
25.0

0.0
5.0
0.0
2.0
4.0
6.0

-10.0

-5.0
-8.0
-6.0
-4.0
-2.0
May-15 Jun-15
Aug-15 Sep-15
Nov-15 Dec-15

(3 mma, % Y oY)
Feb-16 Mar-16
May-16 Jun-16
Aug-16 Sep-16
Nov-16 Dec-16
Feb-17 Mar-17

Source: CEIC, ICICI Bank Research

May-17 Jun-17
Aug-17 Sep-17
Nov-17 Dec-17
Airport passenger traffic

Feb-18 Mar-18
(3 mma, % Y oY) Passenger traffic originating

May-18 Jun-18
Aug-18 Sep-18
Nov-18 Dec-18
Feb-19 Mar-19
May-19 Jun-19
-4
-2
0
2
4

-6
-4
-2
4

0
2
6

May-15 Jun-15
Aug-15 Sep-15
Nov-15 Dec-15
Travel services are also seeing a de-growth..

Mar-16
(3 mma, % MoM)

Feb-16
(3 mma, % MoM)

May-16 Jun-16
Aug-16 Sep-16
Nov-16 Dec-16
s.a

s.a

Feb-17 Mar-17
May-17 Jun-17
Aug-17 Sep-17
Dec-17
non s.a

Nov-17
non s.a
Airport passenger traffic

Feb-18 Mar-18
Passenger traffic originating

May-18 Jun-18
Aug-18 Sep-18
Nov-18 Dec-18
Feb-19 Mar-19
May-19 Jun-19
27
..along with a drag in foreign tourism and telecom subscribers; while
growth in insurance premiums is robust
(3 mma, % Y oY) Cargo traffic monthly (3 mma, % Y oY) Foreign tourist arrivals
15.0 25.0
12.0 20.0

9.0 15.0

6.0 10.0

3.0 5.0

0.0 0.0

-3.0 -5.0

Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-16

Aug-17

Aug-18
Aug-15
May-15

May-16

May-17

May-18

May-19
Jun-15

Dec-15

Jun-16

Jun-17

Dec-17

Jun-18

Dec-18

Jun-19
Dec-16
Sep-16

Sep-17

Sep-18
Mar-16

Mar-17

Mar-19
Sep-15

Mar-18
(mn ) Telecom subscribers (3 mma, % Y oY) Life insurance premium
60.0
1250.0 50.0
1200.0 40.0
1150.0 30.0
1100.0 20.0
10.0
1050.0
0.0
1000.0 -10.0
950.0 -20.0
Jan-16

Jan-17

Jan-19
Jan-18
Jul-15

Jul-16

Jul-17

Jul-18
Oct-15

Oct-16

Oct-17

Oct-18
Apr-15

Apr-16

Apr-17

Apr-19
Apr-18

Feb-17

Feb-18

Feb-19
Nov-16

Nov-17

Nov-18
Aug-16

Aug-17

Aug-18
May-16

May-17

May-19
May-18
Source: CEIC, ICICI Bank Research 28
 10.0
20.0
30.0
40.0
50.0

10.0
0.0

4.0
-30.0
-20.0
-10.0

0.0
2.0
6.0
8.0

-10.0
-8.0
-6.0
-4.0
-2.0
May-15 Jun-15
Aug-15 Sep-15
Nov-15 Dec-15
(3 mma, % Y oY)

(3 mma, % Y oY)
Feb-16 Mar-16
May-16 Jun-16
Aug-16 Sep-16
Nov-16 Dec-16
Feb-17 Mar-17

Source: CEIC, ICICI Bank Research

May-17 Jun-17
Aug-17 Sep-17
Tractor sales

Nov-17 Dec-17
Feb-18 Mar-18
May-18 Jun-18
Aug-18 Sep-18
Nov-18 Dec-18
Feb-19 Mar-19
Micro and small industry credit lending

May-19 Jun-19
-4
-2
20
10
30
40
50

0
2
4
0

-30
-20
-10

May-15 Jun-15
Aug-15 Sep-15
Indicators of rural economy are sluggish…

Nov-15 Dec-15
(3 mma, % MoM)

Feb-16 Mar-16
(3 mma, % MoM)

May-16 Jun-16
Aug-16 Sep-16
Nov-16 Dec-16
s.a
s.a

Feb-17 Mar-17
May-17 Jun-17
Aug-17 Sep-17
Tr actor sales

Nov-17 Dec-17
non s.a
non s.a

Feb-18 Mar-18
May-18 Jun-18
Aug-18 Sep-18
Micro and small industry credit lending

Nov-18 Dec-18
Feb-19 Mar-19
May-19 Jun-19
29
 10.0
15.0
20.0

0.0
5.0

11.0
13.0

3.0
7.0

5.0
9.0
May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15
(3 mma, % Y oY)

(3 mma, % Y oY)
Feb-16 Feb-16
May-16 May-16
Aug-16 Aug-16
Nov-16 Nov-16
Feb-17 Feb-17

Source: CEIC, ICICI Bank Research

May-17 May-17
Aug-17 Aug-17
Nov-17
Agriculture credit

Nov-17
Feb-18 Feb-18
Priority sector lending

May-18 May-18

Aug-18 Aug-18

Nov-18 Nov-18

Feb-19 Feb-19

May-19 May-19
-2
-2

-1
-1

3
3

0
1
2
4
0
1
2
4

May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15
Feb-16 Feb-16
(3 mma, % MoM)
(3 mma, % MoM)

May-16 May-16
Aug-16 Aug-16
..including credit to agriculture and priority sector

Nov-16 Nov-16
s.a
s.a

Feb-17 Feb-17
May-17 May-17
Aug-17 Aug-17
Agricultural credit

Nov-17 Nov-17
non s.a
non s.a

Pr iority sector lending

Feb-18 Feb-18
May-18 May-18
Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
30
 10.0
15.0
4.0

0.0
2.0
6.0
8.0

0.0
5.0

-15.0
-10.0
-6.0
-4.0
-2.0

-5.0
May-15 May-15
moderating

Aug-15 Aug-15
Nov-15 Nov-15
(3 mma, % Y oY)

(3 mma, % Y oY)
Feb-16 Feb-16
May-16 May-16
Aug-16 Aug-16
Nov-16 Nov-16
Feb-17 Feb-17

Source: CEIC, ICICI Bank Research

May-17 May-17
Aug-17 Aug-17
Nov-17 Nov-17
Feb-18 Feb-18
May-18
Large industry credit lending

May-18
Medium industry credit lending

Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
-4
-2
0.5
1.5

0.0
1.0
2.0

0
4

2
-1.5
-0.5
-1.0

May-15 May-15
Aug-15 Aug-15
Nov-15 Nov-15
(3 mma, % MoM)

Feb-16 Feb-16
(3 mma, % MoM)

May-16 May-16
Aug-16 Aug-16
Nov-16 Nov-16
s.a
s.a

Feb-17 Feb-17
May-17 May-17
Aug-17 Aug-17
Nov-17 Nov-17
non s.a
non s.a

Feb-18 Feb-18
Large industry credit lending

Medium industry credit lending

May-18 May-18
Credit to large industry has been rising, while to medium industry is

Aug-18 Aug-18
Nov-18 Nov-18
Feb-19 Feb-19
May-19 May-19
31
Growth in personal loans has stagnated (in consonance with slowing
consumption); while credit-deposit ratios are near multi-year highs
(3 mma, % Y oY) Personal loans Credit-deposit ratio
20.0 79.0
19.0
77.0
18.0
17.0 75.0
16.0
15.0 73.0
14.0 71.0
13.0
12.0 69.0

Jun-15

Dec-15

Jun-16

Dec-16

Jun-17

Dec-17

Jun-18

Dec-18

Jun-19
Sep-15

Sep-16

Sep-18
Mar-16

Mar-17

Mar-18

Mar-19
Sep-17
Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-17

Aug-18
Aug-16
May-16

May-17

May-18

May-19
May-15

Source: CEIC, ICICI Bank Research 32

Net inflows to MFs are close to average; equity purchases by MFs are seeing some
improvement; while SIP contribution is stagnant and PMI services have contracted in June
(IN R bn) MF net inflow (IN R b n) MF net equity purchases
2000.0 250.0
200.0
1000.0 150.0
0.0 100.0
50.0
-1000.0 0.0
-50.0
-2000.0
-100.0
-3000.0 -150.0

Jun-15

Dec-15

Jun-16

Dec-16

Jun-17

Dec-17

Jun-18

Dec-18

Jun-19
Sep-15

Sep-16

Sep-17

Sep-18
Mar-16

Mar-17

Mar-18

Mar-19
Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-16

Aug-17

Aug-18
May-15

May-16

May-17

May-18

May-19
(IN R bn) SIP contribution PMI Services
56.0
100.0
54.0
80.0
52.0
60.0
50.0
40.0

20.0 48.0

0.0 46.0

Jun-16

Dec-16

Jun-17

Dec-17

Jun-18

Dec-18

Jun-19
Sep-16

Sep-18
Sep-17
Mar-17

Mar-18

Mar-19
Feb-17

Feb-18

Feb-19
Jun-16

Jun-17

Jun-18

Jun-19
Dec-17

Dec-18
Dec-16
Aug-16

Aug-17

Aug-18
Oct-16

Oct-17

Oct-18
Apr-17

Apr-18

Apr-19

Source: CEIC, AMFI, Bloomberg, ICICI Bank Research 33

Financial Sector
 8.0
8.5

5.5
6.0
6.5
7.0
7.5
8.0
6.0
6.5
7.0
7.5
(% )

(%)
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17
Jun-17 Jun-17
Sep-17 Sep-17
10 Year-Gsec

Source: Bloomberg, ICICI Bank Research

Dec-17 Dec-17
Mar-18
Weighted average call rate

Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
1.0

0.0
0.5
1.5
2.0
(%)
6.0
8.5

5.5
6.5
7.0
7.5
8.0
Fixed income markets are seeing a rally
(%)

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17
Jun-17 Jun-17
Sep-17 Sep-17
3 month T bills

10 year-3 month

Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
35
 9000.0
15000.0
19000.0
23000.0

11000.0
13000.0
17000.0
21000.0

20000.0
40000.0

16000.0
24000.0
28000.0
32000.0
36000.0
(IN R bn)

(IN R bn)
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17

Source: CEIC, ICICI Bank Research

M1
Mar-17
Jun-17 Jun-17
Sep-17 Sep-17
Currency in circulation

Dec-17 Dec-17

Mar-18 Mar-18

Jun-18 Jun-18

Sep-18 Sep-18

Dec-18 Dec-18

Mar-19 Mar-19

Jun-19 Jun-19
15000.0
30000.0

10000.0
20000.0
25000.0
(IN R bn)

(IN R bn)

130000.0
150000.0
170000.0

100000.0
110000.0
120000.0
140000.0
160000.0

Jun-15
Jun-15
Sep-15
Sep-15
Dec-15
Dec-15
Mar-16
Mar-16
Jun-16
Jun-16
Sep-16
Sep-16
Dec-16
Dec-16
Mar-17
M4

Mar-17
Jun-17
Jun-17
Reserve money

Sep-17
Sep-17
Dec-17
Dec-17
Currency in circulation and money supply stagnated in June

Mar-18 Mar-18

Jun-18 Jun-18

Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
36
 12.0
16.0

10.0
14.0

20.0

10.0
15.0
8.0

2.0
4.0
6.0

5.0

0.0
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
(3 mma, % Y oY)

(3 mma, % Y oY)
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 Jun-17
Sep-17 Sep-17
SCBs deposits

SCBs bank credit

Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
0.5
1.0
1.5
2.0
0.0
3.0

0.0
1.0
2.0

-0.5
-1.0

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
(3 mma, % MoM)
(3 mma, % MoM)

Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
s.a
s.a

Mar-17 Mar-17
Jun-17 Jun-17
Sep-17 Sep-17
SCBs deposits

SCBs bank credit

non s.a
non s.a

Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
37
Deposit growth has been stagnant while credit growth has started moderating..
 15.0
45.0
30.0

0.0
-15.0

-60.0
-45.0
-30.0
Jun-15
Sep-15
Dec-15
(3 mma, % YoY)

Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Jun-17

Source: CEIC, ICICI Bank Research

Sep-17
SCBs food credit

Dec-17
Mar-18
Jun-18
..showing in non-food credit

Sep-18
Dec-18
Mar-19
Jun-19
16.0

10.0
12.0
14.0

6.0
4.0
8.0

Jun-15
Sep-15
Dec-15
(3 mma, % YoY)

Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Jun-17
Sep-17
Dec-17
SCBs non-food credit

Mar-18
Jun-18
Sep-18
Dec-18
Mar-19
Jun-19
38
 20.0
10.0
0.0

-30.0
-40.0
-20.0
-10.0

105.0
110.0
115.0
120.0
125.0
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
(3 mma, % Y oY)

Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17
Jun-17 REER Jun-17
Sep-17 Sep-17
Dec-17 Dec-17
CRB commodity index

Source: Bloomberg, CEIC, ICICI Bank Research

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18

Dec-18 Dec-18

Mar-19 Mar-19

Jun-19 Jun-19
4.0
6.0

0.0
2.0

-6.0
-4.0
-2.0

68.0
80.0

70.0
72.0
74.0
76.0
78.0

Jun-15
Jun-15
Sep-15
Sep-15
Dec-15
Dec-15
(3 m m a, % M oM)

Mar-16
Mar-16
Jun-16 Jun-16

Sep-16 Sep-16
Dec-16
s.a

Dec-16
Mar-17 Mar-17
NEER

Jun-17 Jun-17

Sep-17 Sep-17
non s.a

Dec-17 Dec-17
CRB commodity index

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Global growth weakening global commodity prices, while Rupee seeing
appreciation due to increased flows, benign inflation and fiscal prudence

Mar-19 Mar-19
Jun-19 Jun-19
39
Debt capital flows improved while equity flows moderated in June
(US D mn) FPI debt flow (US D mn) FPI equity flow
6000.0 8000.0
6000.0
4000.0
4000.0
2000.0 2000.0
0.0 0.0
-2000.0
-2000.0
-4000.0
-4000.0 -6000.0
Jun-15

Jun-16

Jun-17

Jun-18

Jun-19

Jun-15

Jun-16

Jun-17

Jun-18

Jun-19
Dec-15

Dec-16

Dec-17

Dec-18

Dec-15

Dec-16

Dec-17

Dec-18
Sep-16

Sep-17

Sep-18

Sep-15

Sep-16

Sep-17

Sep-18
Sep-15

Mar-16

Mar-17

Mar-18

Mar-19

Mar-16

Mar-17

Mar-19
Mar-18
Source: Bloomberg, ICICI Bank Research 40
Key inflation
metrics
 3.0
7.0

1.0
5.0

-7.0
-5.0
-3.0
-1.0

7.0

1.0
3.0
5.0

-5.0
-3.0
-1.0
Jun-15 Jun-15
Sep-15 Sep-15

Dec-15 Dec-15
(3 mma, % Y oY)

(3 mma, % Y oY)
Mar-16 Mar-16

Jun-16 Jun-16

Sep-16 Sep-16
Dec-16
Dec-16
Mar-17
Mar-17
WPI

Source: CEIC, ICICI Bank Research

Jun-17
Jun-17 WPI core
Sep-17
Sep-17
Dec-17
Dec-17
Mar-18
Mar-18
Jun-18
Jun-18
Sep-18
Sep-18
Dec-18
Dec-18
Mar-19
Mar-19
Jun-19
Jun-19
1.0
2.0

0.0
0.5
0.0
1.0

-1.0
-0.5
-2.0
-1.0

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
(3 mma, % MoM)
(3 mma, % MoM)

Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
s.a
s.a

Mar-17 Mar-17
WPI

Jun-17 Jun-17
WPI core

Sep-17 Sep-17
non s.a
non s.a

Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Wholesale price index (WPI) moderated in June as did WPI core

Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
42
 9.0

1.0
3.0
5.0
7.0

0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
-3.0
-1.0
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
(3 mma, % Y oY)

(3 mma, % Y oY)
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 CPI Jun-17
WPI food

Sep-17 Sep-17
Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18

Mar-19 Mar-19

Jun-19 Jun-19
0.0
1.5

0.5
1.0
4.0

0.0
2.0

-0.5
-4.0
-2.0

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
(3 mma, % MoM)
(3 mma, % MoM)

Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
s.a
s.a

Mar-17 Mar-17
CPI

Jun-17 Jun-17
WPI food

Sep-17 Sep-17
non s.a
non s.a

Dec-17 Dec-17
Mar-18 Mar-18
Jun-18 Jun-18
WPI food increased sharply, while CPI headline also moved up

Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
43
CPI core fell further while food inflation picked up in June
CPI core
(3 mma, % MoM) s.a non s.a
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0.0

Jun-15

Jun-16

Jun-17

Jun-18

Jun-19
Dec-15

Dec-16

Dec-18
Dec-17
Sep-15

Sep-16

Sep-17

Sep-18
Mar-16

Mar-17

Mar-19
Mar-18
CPI f ood
(3 mma, % MoM) s.a non s.a
2.0
1.5
1.0
0.5
0.0
-0.5
-1.0
-1.5

Jun-15

Jun-16

Jun-17

Jun-18

Jun-19
Dec-15

Dec-16

Dec-18
Dec-17
Sep-15

Sep-16

Sep-17

Sep-18
Mar-16

Mar-17

Mar-19
Mar-18
Source: CEIC, ICICI Bank Research 44
 5.0

1.0
3.0
7.0
9.0

5.0

1.0
3.0
7.0
9.0
-5.0
-3.0
-1.0

-5.0
-3.0
-1.0
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
(3 mma, % Y oY)

(3 mma, % Y oY)
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 Jun-17
Sep-17 Sep-17
Rice retail prices

Dec-17 Dec-17
Rice wholesale prices
Rice prices are picking up..

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
1.0

0.0
0.5
1.5
2.0

-1.0
-0.5

1.0

0.0
0.5
1.5
2.0

-1.0
-0.5

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16 Mar-16
(3 mma, % MoM)

(3 mma, % MoM)

Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
s.a

s.a

Mar-17 Mar-17
Jun-17 Jun-17
Sep-17 Sep-17
Rice retail prices

Dec-17
non s.a

Dec-17
non s.a
Rice wholesale prices

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
45
 12.0

6.0

0.0
3.0
9.0

-6.0
-3.0
10.0

4.0
6.0
8.0

0.0
2.0

-4.0
-2.0
Jun-15
Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16
(3 mma, % Y oY)

Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17

Source: CEIC, ICICI Bank Research

Jun-17 Jun-17
Sep-17 Sep-17
Wheat retail prices

Dec-17 Dec-17
(3 mma, % Y oY) Wheat wholesale prices

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
0.0
1.0
2.0
3.0

-2.0
-1.0

0.0
1.0
2.0
3.0

-2.0
-1.0

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16 Mar-16
(3 mma, % MoM)

(3 mma, % MoM)

Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
..while wheat prices are showing some cooling off..

s.a

s.a

Mar-17 Mar-17
Jun-17 Jun-17
Sep-17 Sep-17
Wheat retail prices

Dec-17
non s.a

Dec-17
non s.a
Wheat wholesale prices

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18
Mar-19 Mar-19
Jun-19 Jun-19
46
 40.0
80.0

20.0
60.0

0.0

-60.0
-40.0
-20.0
Jun-15
Sep-15
Dec-15
(3 mma, % Y oY)

Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Jun-17
Sep-17

Source: Bloomberg, ICICI Bank Research

Dec-17
India crude oil basket
..along with crude prices

Mar-18
Jun-18
Sep-18
Dec-18
Mar-19
Jun-19
20.0

10.0

0.0

-10.0

-20.0

Jun-15
Sep-15
Dec-15
(3 mma, % MoM)

Mar-16
Jun-16
Sep-16
Dec-16
s.a

Mar-17
Jun-17
Sep-17
non s.a

Dec-17
India crude oil basket

Mar-18
Jun-18
Sep-18
Dec-18
Mar-19
Jun-19
47
Fiscal Sector
Growth in fiscal deficit and revenue receipts has moderated in May, while as a
percentage of full years target is similar to last fiscal
Fiscal deficit (% ) Fi scal deficit % of full years t arget
(3 mma, % Y oY)
300.0 70.0
250.0 60.0
200.0
50.0
150.0
100.0 40.0
50.0 30.0
0.0 20.0
-50.0
10.0
-100.0
-150.0 0.0

May-08

May-09

May-10

May-11

May-12

May-13

May-14

May-16

May-17

May-19
May-15

May-18
Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-16

Aug-18
Aug-17
May-15

May-16

May-17

May-18

May-19
Revenue receipts (% ) Revenue receipts % of full years target
(3 mma, % Y oY)
100.0 8.0

80.0 7.0
6.0
60.0
5.0
40.0 4.0
3.0
20.0
2.0
0.0 1.0
-20.0 0.0

May-08

May-09

May-10

May-11

May-13

May-15

May-16

May-18
May-12

May-14

May-17

May-19
Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-16

Aug-17

Aug-18
May-15

May-16

May-17

May-18

May-19

Source: CEIC, Union Budget, ICICI Bank Research 49

Growth in tax revenue has moderated in May with indirect tax as a
percentage of full years target being lower than last fiscal
Direct tax (% ) D i rect Tax % of full years target
(3 mma, % Y oY)
50.0 8.0
7.0
40.0
6.0
30.0
5.0
20.0 4.0
10.0 3.0
0.0 2.0

-10.0 1.0
0.0
Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-16

Aug-17

Aug-18
May-16

May-17

May-18

May-19
May-15

May-08

May-09

May-11

May-12

May-14

May-15

May-16

May-17

May-18

May-19
May-10

May-13
(% ) Indirect Tax % of f ull years target
(3 mma, % Y oY) Indirect tax
16.0
60.0
50.0 14.0
40.0 12.0
30.0 10.0
20.0 8.0
10.0 6.0
0.0 4.0
-10.0 2.0
-20.0 0.0
Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-16

Aug-17

Aug-18
May-16

May-17

May-18

May-19
May-15

May-09

May-10

May-11

May-13

May-14

May-16

May-17

May-19
May-08

May-12

May-15

May-18
Source: CEIC, Union Budget, ICICI Bank Research 50
Growth in expenditure is showing a decline in May with capital expenditure as
a percentage of full years target being lower than last fiscal
Revenue expenditure (% ) R evenue expenditure % of full years t arget
(3 mma, % Y oY)
40.0 25.0

30.0 20.0

20.0 15.0

10.0 10.0

0.0 5.0

-10.0 0.0
Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-16

Aug-17

Aug-18
May-16

May-17

May-18

May-19
May-15

May-08

May-09

May-10

May-11

May-13

May-15

May-16

May-18
May-12

May-14

May-17

May-19
Capital expenditure (% ) Capital expenditure % of full years target
(3 mma, % Y oY)
300.0 25.0
250.0
200.0 20.0
150.0
15.0
100.0
50.0 10.0
0.0
-50.0 5.0
-100.0
-150.0 0.0

May-08

May-09

May-10

May-11

May-13

May-15

May-16

May-18
May-12

May-14

May-17

May-19
Feb-16

Feb-17

Feb-18

Feb-19
Nov-15

Nov-16

Nov-17

Nov-18
Aug-15

Aug-16

Aug-18
Aug-17
May-15

May-16

May-17

May-18

May-19

Source: CEIC, Union Budget, ICICI Bank Research 51

External Sector
FY2019 BoP ended with a mild deficit, with metrics improving sharply in
March 2019…
(US D mn) Current account balance (% ) Current account balance (% of GDP)
0.0 0.0
-2500.0 -0.5
-5000.0
-1.0
-7500.0
-10000.0 -1.5
-12500.0 -2.0
-15000.0
-2.5
-17500.0
-20000.0 -3.0

Jun-15

Jun-16

Jun-17

Jun-18
Dec-15

Dec-16

Dec-17

Dec-18
Sep-15

Sep-16

Sep-17

Sep-18
Mar-15

Mar-16

Mar-17

Mar-19
Mar-18
Jun-15

Jun-16

Jun-17

Jun-18
Dec-15

Dec-16

Dec-17

Dec-18
Sep-15

Sep-16

Sep-17

Sep-18
Mar-15

Mar-17

Mar-18

Mar-19
Mar-16

(US D mn) Capital account balance (US D mn) Balance of payment- overall
35000.0 35000.0
30000.0
25000.0
25000.0
20000.0 15000.0
15000.0 5000.0
10000.0
-5000.0
5000.0
0.0 -15000.0
Jun-15

Jun-16

Jun-17

Jun-18

Jun-15

Jun-16

Jun-17

Jun-18
Dec-15

Dec-16

Dec-18

Dec-15

Dec-16

Dec-17

Dec-18
Dec-17
Sep-15

Sep-16

Sep-17

Sep-18

Sep-15

Sep-16

Sep-17

Sep-18
Mar-15

Mar-17

Mar-18

Mar-19

Mar-15

Mar-17

Mar-18

Mar-19
Mar-16

Mar-16
Source: CEIC, RBI, ICICI Bank Research 53
 2000.0
4000.0
6000.0
8000.0

0.0

-6000.0
-4000.0
-2000.0
7000.0
8000.0
9000.0
11000.0
12000.0
13000.0

10000.0
14000.0

Jun-15

(US D mn)
Mar-15
(US D mn)

Sep-15
Jun-15
Dec-15
Sep-15
Mar-16
Dec-15
Jun-16
Mar-16
Sep-16
Jun-16
Dec-16
Sep-16
Mar-17 Dec-16
Jun-17 Mar-17
Remmitances

FPI equity flow

Sep-17 Jun-17
Dec-17 Sep-17
Mar-18 Dec-17

Source: CEIC, Bloomberg, RBI, ICICI Bank Research

Jun-18 Mar-18
Sep-18 Jun-18
Dec-18 Sep-18
Mar-19 Dec-18
Jun-19 Mar-19
2000.0
4000.0
6000.0

0.0

-4000.0
-2000.0

5000.0
7000.0
9000.0

1000.0
3000.0

-1000.0
(US D mn)

May-15 Jun-15
(US D mn)

Aug-15 Sep-15
Nov-15 Dec-15
Feb-16 Mar-16
May-16 Jun-16
Aug-16 Sep-16
Nov-16 Dec-16
Feb-17 Mar-17
May-17 Jun-17
FPI debt flow

Aug-17 Sep-17
Nov-17 Dec-17
Feb-18 Mar-18
Net foreign direct investment

May-18 Jun-18
Aug-18 Sep-18
Nov-18 Dec-18
Feb-19 Mar-19
May-19 Jun-19
..assisted by FII and FDI flows, which are seeing some moderation recently

54
Surveys
 95.0
97.0
99.0
102.0
104.0
110.0

100.0
106.0
108.0
112.0

101.0
103.0
105.0
107.0
109.0
(3 mma)
Mar-15 Mar-15
(3 mma)

Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
held up in March 2019

Dec-16 Dec-16

Source: CEIC, ICICI Bank Research

Mar-17 Mar-17
Jun-17 Jun-17
RBI industrial survey

Sep-17 Sep-17
Dec-17 Dec-17
RBI consumer confidence index

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Dec-18 Dec-18

Mar-19 Mar-19
95.0

90.0
100.0
105.0
110.0
95.0
100.0
105.0
110.0
115.0

Mar-15 Mar-15
Jun-15 Jun-15
Sep-15 Sep-15
Dec-15 Dec-15
Mar-16 Mar-16
Jun-16 Jun-16
Sep-16 Sep-16
Dec-16 Dec-16
Mar-17 Mar-17
Jun-17 Jun-17
RBI industrial survey

Sep-17 Sep-17
Dec-17 Dec-17
RBI consumer confidence index

Mar-18 Mar-18
Jun-18 Jun-18
Sep-18 Sep-18
Industrial confidence is showing stagnation, while consumer confidence

Dec-18 Dec-18
Mar-19 Mar-19
56
Household inflation expectations are moderating
(%) RBI inflation expection 3 months ahead (%) RBI inflation expection 1 year ahead
11.0 12.0
10.5
10.0 11.0
9.5
10.0
9.0
8.5 9.0
8.0
7.5 8.0
7.0 7.0
Jun-15

Jun-16

Jun-17

Jun-18
Dec-15

Dec-16

Dec-17

Dec-18
Sep-15

Sep-16

Sep-17

Sep-18
Mar-15

Mar-16

Mar-17

Mar-18

Mar-19

Jun-15

Jun-16

Jun-17

Jun-18
Dec-15

Dec-16

Dec-17

Dec-18
Sep-15

Sep-16

Sep-17

Sep-18
Mar-15

Mar-16

Mar-17

Mar-18

Mar-19
Source: CEIC, ICICI Bank Research 57
Thank you
ICICI Bank: ICICI Bank Towers, Bandra Kurla Complex, Mumbai- 400 051. Phone: (+91-22) 2653-1414
Treasury Research Group
Economics Research
Kamalika Das Economist (+91-22) 4008-1414 (ext 6280) kamalika.das@icicibank.com
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This marketing material is intended to be issued, distributed and/or offered to a limited number of investors who qualify as ‘Professional Clients’ pursuant to Rule 2.3.3 of the DFSA
Conduct of Business Rulebook, or where applicable a Market Counterparty only, and should not be referred to or relied upon by Retail Clients and must not be relied upon by any
person other than the original recipients and/or reproduced or used for any other purpose. ‘Professional Clients’ as defined by DFSA need to have net assets of USD 1,000,000/- and
have sufficient experience and understanding of relevant financial markets, products or transactions and any associated risks.
The DFSA has no responsibility for reviewing or verifying any marketing material or other third party investment documents in connection with the marketing material / report.
Accordingly, the DFSA has not approved the marketing material or third party investment documents nor taken any steps to verify the information set out in the same, and has no
responsibility for it.The securities to which this document relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the securities offered should
conduct their own due diligence on the securities.
If you do not understand the contents of this document, you should consult an authorised financial adviser.”

DISCLOSURE FOR RESIDENTS IN THE UNITED ARAB EMIRATES (“UAE”):

This document is for personal use only and shall in no way be construed as a general offer for the sale of Products to the public in the UAE, or as an attempt to conduct business, as
a financial institution or otherwise, in the UAE. Investors should note that any products mentioned in this document, any offering material related thereto and any interests therein
have not been approved or licensed by the UAE Central Bank or by any other relevant licensing authority in the UAE, and they do not constitute a public offer of products in the UAE
in accordance with the Commercial Companies Law, Federal Law No. 8 of 1984 (as amended) or otherwise.

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DISCLOSURE FOR RESIDENTS IN HONGKONG
This document has been issued by ICICI Bank Limited (“ICICI”) in the conduct of its Hong Kong regulated business for the information of its institutional and professional investor (as
defined by Securities and Future Ordinance (Chapter 571)) customers; it is not intended for and should not be distributed to retail or individual investors in Hong Kong. ICICI Bank
Limited, India is regulated by the Reserve Bank of India. ICICI Bank Limited, Hong Kong branch is regulated by the Hong Kong Monetary Authority. The information contained in this
document is intended for the exclusive use of the intended recipient and may contain proprietary, confidential or legally privileged information. Any person who is not a relevant person
should not act or rely on this document or any of its contents. Persons distributing this presentation must satisfy themselves that it is lawful to do so.
Nothing contained in this document shall constitute or be deemed to constitute an offer to sell/purchase or as an invitation or solicitation to do so for any securities of any entity. ICICI
has based this document on information obtained from sources it believes to be reliable, but which it has not independently verified. ICICI makes no representation as to the accuracy,
completeness or reliability of any information contained herein or otherwise provided and hereby disclaim any liability with regard to the same. ICICI (including its affiliates, and related
corporations) do not provide any financial advice, and is not your fiduciary or agent, in relation to the securities. The contents of this document do not take into account your personal
circumstances. Before entering into any transaction, you should take steps to ensure that you understand the transaction and have made an independent assessment of the
appropriateness of the transaction in light of your own objectives and circumstances, including the possible risks and benefits of entering into such transaction and should seek your
own financial, business, legal, tax and other advice regarding the appropriateness of investing in any securities.
ICICI and/or its affiliates and/or their directors, officers, associates, connected parties and/or employees, may have, or have had, interests in the securities (or any related securities) and
may from time to time add to or dispose of, or may be materially interested in, any such securities. Furthermore, ICICI may, but shall be under no obligation to, make a market or
provide quotes in relation to the securities (or any related securities). ICICI and/or its affiliates may have, or have had, other business relationships (including lending or participating or
investing in other financing transactions or other commercial banking or investment banking or other relations) with the issuer and/or guarantor (if any) of the securities or any other
person connected with the securities and may from time to time seek to provide financing or other commercial banking or investment banking or other services to such persons.
ICICI Bank and/or its affiliates are full service financial institutions engaged in various activities which may include securities trading, commercial and investment banking, financial
advice, investment management, principal investment, hedging, financing and brokerage activities. In the ordinary course of their various business activities, ICICI Bank and/or its
affiliates may make or hold (on its own account, on behalf of clients or in its capacity of investment adviser) a broad array of investments and actively trade debt and equity securities (or
related derivative securities) and financial instruments (including bank loans) for its own account and for the accounts of its clients and may at any time hold long and short positions in
such securities and instruments and enter into other transactions, including credit derivatives (such as asset swaps, repackaging and credit default swaps) in relation thereto. Such
transactions, investments and securities activities may involve securities and instruments of the issuer or its affiliates or of other entities, and may be entered into at the same time or
proximate to offers and sales of securities or at other times in the secondary market and be carried out with counterparties that are also purchasers, holders or sellers of securities or
other clients of ICICI Bank or its affiliates. As a result, you should be aware that a conflict of interest may exist. In accordance with the regulatory requirements and its own conflicts of
interest policies, ICICI Bank has in place arrangements to manage conflicts of interest that arise between itself and its clients and between its different clients. Where it does not consider
that the arrangements under its conflicts of interest policies are sufficient to manage a particular conflict, it will inform you of the nature of the conflict so that you can decide how to
proceed.

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DISCLOSURE FOR RESIDENTS IN SINGAPORE

ICICI Bank Limited, India (“ICICI India”) is incorporated under the laws of India and is regulated by the Reserve Bank of India. ICICI Bank Limited, Singapore branch (“ICICI”) is regulated
by the Monetary Authority of Singapore. The information contained in this e-mail and/ or any attachments thereto are intended for the exclusive use of the intended recipient and may
contain proprietary, confidential or legally privileged information. If you are not the intended recipient, please note that you are not authorised to disseminate, distribute or copy this e-
mail or any parts of it or act upon/rely on the contents of this e-mail and/ or attachments in any manner. Please notify the sender immediately by e-mail and destroy all copies of this e-
mail and any attachments.

The contents of this e-mail and/ or attachments do not take into account your personal circumstances. You must accordingly make their own independent evaluation of the information
contained herein and of the securities and consider your own investment objective, financial situation and particular needs and seek your own financial, business, legal, tax and other
advice regarding the appropriateness of investing in any securities. ICICI India (including ICICI, affiliates and related corporations of ICICI India) do not provide any financial advice, and is
not your fiduciary or agent, in relation to the securities. The contents of this information do not take into account your personal circumstances. Before entering into any transaction, you
should take steps to ensure that you understand the transaction and have made an independent assessment of the appropriateness of the transaction in light of your own objectives and
circumstances, including the possible risks and benefits of entering into such transaction and should seek your own financial, business, legal, tax and other advice regarding the
appropriateness of investing in any securities. As mentioned, ICICI India is regulated by the Reserve Bank of India. Hence, in relation to your dealing with ICICI India, you understand that
your interest will be subject to protection of local laws and regulations in India, which may offer different or diminished protection than available under Singapore laws and regulations.
You also understand that the Monetary Authority of Singapore will be unable to compel the enforcement of the rules of the local regulators.

Please also note that ICICI India or ICICI is unable to exercise control or ensure or guarantee the integrity of/over the contents of the information contained in e-mail transmissions and /
or attachments and that any views expressed in this e-mail and / or attachments are not endorsed by/binding on ICICI. Before opening any attachments please check them for viruses
and defects and please note that ICICI accepts no liability or responsibility for any damage caused by any virus that may be transmitted by this email and/ or attachments thereto.
proceed.

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