Need deeper rate cut to get back growth: KV Kamath

Kamath also believes that the signals are all right but the transmission of the signal to entreprenuer is yet to happen.

If the economy has to really get back to 10 percent trajectory, rate cut will have to be much deeper than what has being discussed so far

KV Kamath

non-executive Chairman

Infosys

In a CNBC-TV18 exclusive, KV Kamath, non-executive chairman,  ICICI Bank says that government signals are not transmitting to the ground and to get growth back the country will need much deeper rate cuts.

According to him, the twin deficits are now under control and there is no worry on that front. "I think infaltion is also on a downward trend and now you have growth which is also negative which ought not to have been. So I would think all the ingredients for a rate cut are there," Kamath adds.

He further says that the call is entirely on the Reserve Bank of India now, and if the economy has to really get back to 10 percent trajectory, rate cut will have to be much deeper than what has being discussed so far.

Kamath believes the signals are all right but the transmission of the signal to entreprenuer has not yet happened.

"You do not need to look afar for that because lot of things that the entreprenuer, company would actually like to see are not yet done, that's work in process, so work in process is taking a little longer than anticipated and I am sure it will happen," says Kamath.

ICICI Bank stock price

On December 15, 2014, at 09:20 hrs ICICI Bank was quoting at Rs 346.00, down Rs 0.6, or 0.17 percent. The 52-week high of the share was Rs 366.30 and the 52-week low was Rs 188.85.

The company's trailing 12-month (TTM) EPS was at Rs 18.21 per share as per the quarter ended September 2014. The stock's price-to-earnings (P/E) ratio was 19. The latest book value of the company is Rs 126.40 per share. At current value, the price-to-book value of the company is 2.74.

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