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BUSINESS AND ECONOMY - November 2015

Nov 2015

Apr 28, 2021

SC Allows Vedanta's Oxygen Plant at Thoothukudi to Operate

The Supreme Court allowed Vedanta to operate its closed oxygen plant at Thoothukudi in Tamil Nadu, saying the order has been passed in view of "national need" for oxygen and there should be no political bickering over the generation of the gas by the company as the country is facing a "national crisis".
The apex court made it clear that Vedanta shall not be allowed to enter and operate its copper smelting plant under the garb of this order and that permission to operate oxygen plant would not create any equity in the company's favour.
A bench of Justices D Y Chandrachud, L Nageswara Rao and S Ravindra Bhat directed the Tamil Nadu government to form an oversight committee to oversee the functioning of the plant which would include District Collector and Superintendent of Police (SP) of Thoothukudi, District Environmental Engineer, Sub-Collector Thoothukudi and two government officials.

Promoter Company Worldone Acquires JSPL's Thermal Power Business

Jindal Steel & Power (JSPL) has sold off its thermal power business to Worldone, a company owned by the promoter group of JSPL.
JSPL has divested 96.42 per cent stake in Jindal Power (JPL) to Worldone.
As per reports, the estimated deal size is close to Rs. 12,000 crore, which includes Rs. 6,500 crore debt, Rs. 7,000 crore redeemable preference shares and Rs. 3,015 crore equity infusion. It also includes Rs 4,400 crore of an old loan, which JPL had taken from JSPL.
JSPL has two coal-fired power plants in Raigarh and Tamnar totaling 3400 Mw. JPL had earlier tried to sell the units to JSW Energy but the deal did not close.
V R Sharma, managing director, JSPL said that the company will now focus on steel production and double the output of its Angul steel plant to 12 million tonne per annum (MTPA).

India, Japan and Australia Unveil Supply Chain Initiative

In a move to counter China's dominance of supply chain in the Indo-Pacific region, Trade Ministers of India, Japan and Australia formally launched the Supply Chain Resilience Initiative (SCRI) in a virtual trilateral ministerial meeting.
The SCRI aims to create a virtuous cycle of enhancing supply chain resilience with a view to eventually attaining strong, sustainable, balanced and inclusive growth in the region. The ministers consented that expansion of the SCRI may be considered based on consensus, if needed, in due course.
The meeting held by videoconference was attended by India's Trade Minister Piyush Goyal, Australia's Minister for Trade, Tourism and Investment Dan Tehan and Japan's Minister of Economy, Trade and Industry Kajiyama Hiroshi.
Initially, SCRI will focus on sharing best practices on supply chain resilience and holding investment promotion events and buyer-seller matching events to provide opportunities for stakeholders to explore the possibility of diversification of their supply chains. The ministers instructed officials to implement the initial projects and further develop the initiative.

Korean Auto firm Kia Unveils a New Brand Identity in India

In line with its global strategy, the India arm of South Korean major Kia has dropped 'Motors' from its name. This is to reflect the transition from an automaker to a provider of advanced and eco-friendly mobility solutions.
With a new brand identity and slogan, the fourth-largest car maker in India by sales aims to accelerate growth and strengthen its premium positioning. Close to 60 per cent models that Kia sells in India are top trims of the models, the company claims.
Kia has updated its compact SUV Seltos and the subcompact crossover SUV Sonet with the newly stylized logo. The models, with the refashioned logo, will go on sale in the first week of May.
It also unveiled a new slogan — Movement that inspires'. Tae-Jin Park, executive director and chief sales and business strategy officer, said the new identity goes beyond just the logo change and will manifest in various ways, from the kind of product it brings in the future to the way it goes about the business.

RBI Issues Guidelines for Appointment of Statutory Auditors of Banks, NBFCs

The Reserve Bank of India issued guidelines for appointment of statutory auditors of banks and non-banking finance companies (NBFCs), including housing finance companies.
Guidelines for Appointment of Statutory Central Auditors (SCAs)/ Statutory Auditors (SAs) of Commercial Banks (excluding RRBs), UCBs and NBFCs (including HFCs)' will be applicable for financial year 2021-22 and onwards.
However, non-deposit taking NBFCs with asset size below Rs. 1,000 crore have the option to continue with their extant procedure.
The guidelines provide necessary instructions for appointment of SCAs/SAs, the number of auditors, their eligibility criteria, tenure and rotation, etc. while ensuring the independence of auditors.
As the guidelines are being implemented for the first time for Urban Co-operative Banks (UCBs) and NBFCs from 2021-22, "they shall have the flexibility to adopt these guidelines from the second half of FY 2021-22, in order to ensure that there is no disruption".
Banks and UCBs will be required to take prior approval of Reserve Bank of India (RBI) for appointment/reappointment of SCAs/SAs.

Stellantis Makes Top-level Appointments for Indian Region

Stellantis India & Asia Pacific announced key leadership appointments for its operations both within India and the region. The Amsterdam-based Stellantis is a multinational automotive manufacturer, formed in 2021 on the basis of a 50:50 cross-border merger between the Italian-American Fiat Chrysler Automobiles (FCA) and the French PSA Group.
The company has appointed Roland Bouchara as CEO & Managing Director for Stellantis in India. Bouchara will be responsible for the Jeep and Citroën national sales companies (NSCs), coupled with the group's manufacturing operations.
Since 2017, Bouchara has led the Citroën India operations in his capacity as Senior Vice President of Sales and Marketing for the brand. This included end-to-end execution of the recent launch of the Citroën brand and its first product in India – the new Citroën C5 Aircross.
The company also announced the appointment of Partha Datta as head of Engineering, Design, Research & Development (R&D) operations across the India & Asia Pacific Region.

ADV Partners, Premji Invest to Acquire Stake in Micro Plastics

Asian private equity firm ADV Partners and Premji Invest, the investment arm of Wipro billionaire Azim Premji, said they have acquired a significant majority stake in leading plastic molding company Micro Plastics Private Limited (MPPL).
This investment will catalyse the next stage of MPPL's growth plans by supporting significant expansion and development of new manufacturing facilities to cater to increasing demand from customers. The investment also builds on MPPL's success and robust revenue growth of over 20 per cent over the past five years in CAGR terms.
MPPL is headquartered in Bengaluru and operates five manufacturing facilities in and around the city. MPPL founder and managing director, Vijendra Babu, a 25-year industry veteran, will continue to retain a stake in the business and drive the company along with a very experienced senior leadership team.

Apr 27, 2021

Abrdn: Standard Life Aberdeen Vowel-less Rebrand Mocked

Investment house Standard Life Aberdeen has announced a new name - with most of its vowels removed.
The firm said that its new name "Abrdn" would still be pronounced "Aberdeen", but that the rebrand would make it "modern" and "dynamic".
In a video posted on Twitter, it said the "A" would be taken from "Standard Life", rather than Aberdeen.
The decision drew some jokes online from those who were not impressed by the name change.
"Our new brand Abrdn builds on our heritage and is modern, dynamic and, most importantly, engaging for all of our client and customer channels," said chief executive Stephen Bird.

Reliance, BP Start Production at Satellite Cluster

Reliance Industries (RIL) and BP announced the start of production from the Satellite Cluster gas field, in block KG-D6, ahead of schedule. The second of the three deep-water gas developments, planned jointly, was expected to start production in mid-2021.
RIL and BP have been developing R Cluster, Satellite Cluster and MJ in the KG-D6 block — which together is expected to produce around 30 mmscmd (1 billion cubic feet a day) of natural gas by 2023. It will meet up to 15 per cent of the country's gas de¬mand.
Despite Covid-19 challe¬nges, the Satellite Cluster field has come onstream two months ahead of schedule, it said. The field is located about 60 km from the existing on¬shore terminal at Kakinada on the East Coast in water depths of up to 1,850 metres.
The fields will each utilise the existing hub infrastructure in the KG-D6 block. RIL is the operator of the block with a 66.67 per cent participating interest, while BP holds 33.33 per cent.

RBI Caps Bank CEO Tenure at 15 Years

Reserve Bank of India has capped the tenure of managing director and chief executive (MD&CEO) of commercial banks for the same incumbent to 15 years. The same limit is applicable to whole time directors (WTD).
The MD&CEO or WTD, who is also a promoter/ major shareholder, cannot hold these posts for more than 12 years, according to the latest RBI notification.
In extraordinary circumstances, RBI, at its discretion, may allow MD&CEO or WTDs, who are also promoter/major shareholder, to continue up to 15 years. While considering such cases, RBI will factor in level of progress and adherence to the milestones for dilution of promoters' shareholding in the bank.

RBI Cancels Licence of Bhagyodaya Friends Urban Co-Operative Bank

The RBI cancelled the licence of Bhagyodaya Friends Urban Co-operative Bank Limited (Amravati), as the lender does not have adequate capital and will be unable to pay its present depositors in full.
However, as per the data submitted by the bank, more than 98 per cent of the depositors will receive the full amounts of their deposits from Deposit Insurance and Credit Guarantee Corporation (DICGC).
On liquidation, every depositor would be entitled to receive a deposit insurance claim amount of his/her deposits up to a monetary ceiling of Rs. 5 lakh from DICGC, subject to the provisions of the DICGC Act, 1961.

SA and Kenya Telecom Firms Bid for Ethiopian Market

Giant telecom operators from the UK, South Africa, Kenya and Japan are bidding to enter Ethiopia's untapped telecom market.
The country's finance ministry announced that it received two bids - from South Africa's MTN Group and a consortium that includes Kenya's Safaricom - as it works to open the telecom market to international operators.
The consortium also includes Vodafone and CDC companies from the UK, South Africa's Vodacom and Japanese firm Sumitomo.
Financial and technical assessments of the bids will be done by a national evaluation committee.
Opening up the telecom market was one of Prime Minister Abiy Ahmed's pledges of economic reform when he came to power three years ago.

RBI Turns Net Seller of US Dollars in February

According to RBI data, the Reserve Bank turned net seller of the US dollar in February 2021, offloading USD 1.219 billion in the spot market.
This is for the second time in the financial year 2020-21 when the central bank sold the US currency in the spot market on a net basis. In April 2020, RBI had net sold USD 1.142 billion. Since then, it remained a net purchaser for straight nine months till January 2021.
During February 2021, RBI bought USD 23.352 billion and sold USD 24.571 billion in the spot market, the central bank said in its monthly bulletin for April 2021.
In the same month of 2020, RBI had net purchased USD 9.144 billion.

Apr 26, 2021

Seven-point Action Plan 'ONGC Way Forward'

The petroleum ministry has told India's largest oil and gas producer ONGC to sell stake in producing oil fields such as to Ratna R-Series to private firms, get foreign partners in KG basin gas fields, monetise existing infrastructure, and hive off drilling and other services into a separate firm to raise production.
Amar Nath, additional secretary (exploration) in the Ministry of Petroleum and Natural Gas, on April 1 wrote to Oil and Natural Gas Corporation (ONGC) Chairman and Managing Director Subhash Kumar giving a seven-point action plan, 'ONGC Way Forward' that would help the firm raise oil and gas production by one-third by 2023-24.

Apr 25, 2021

Accenture India Head Rekha Menon to Take over as NASSCOM Chairman for FY2

The National Association of Software and Services Companies (NASSCOM), the information technology service body appointed Rekha M Menon, Chairperson and Senior Managing Director at Accenture in India as its Chairperson for 2021-22.
Menon succeeds U B Pravin Rao, Chief Operating Officer, Infosys, who served as Chairman of NASSCOM for the year 2020-21. NASSCOM named Krishnan Ramanujam, President and Head of Business & Technology Services, Tata Consultancy Services as the Vice Chairperson for this financial year.
Menon is the first woman to take on the role of Chairperson for NASSCOM in the association's 30-year history.

South Africa's FirstRand Bank to Exit India after 12 Years

Close on the heels of Citigroup's decision to exit retail banking business in India, South Africa's second largest bank - FirstRand Bank - with $118 billion in assets is the latest foreign bank to exit India. The news was broken to FirstRand staff in Mumbai - its only branch. FirstRand's exit is the second retreat by a foreign lender in India within a week after US giant Citibank announced plans to sell its consumer banking business in 13 markets, including India late last week. FirstRand India is a licensed financial services provider in India and operates as a "branch" of FirstRand Bank South Africa. In 2019, FirstRand Bank completed 10 years of operations in India under its corporate and investment banking franchise. According to FirstRand's Bank India's annual report (2019-20), its deposits stood at Rs. 318 crore and advances at Rs. 420 crore at the end of March 2020. Its investment book was of Rs. 1,208 crore.

Apr 24, 2021

Tata Steel Takes Liberty Steel to Court in UK over Missed Payments

Indian steel major Tata Steel has filed a commercial court claim in the UK against British Indian steel tycoon Sanjeev Gupta led GFG Alliance, which owns Liberty Steel, over alleged missed payments from an acquisition dating back to 2017.
Liberty Steel had stepped in to acquire Tata's Speciality Steels business employing more than 1,700 people in Yorkshire, Lancashire and the West Midlands in an estimated 100 million pounds deal, which Tata Steel announced as complete in May 2017.
Now, it has emerged that payments have been missed in that transaction resulting in Tata launching proceedings against Liberty Speciality Steels, Liberty House Group PTE and Speciality Steel UK all parts of GFG Alliance.

Torrent Power Bags 300 Mw Long-term Solar Power Generation PPA

Ahmedabad-based Torrent Power Limited has been awarded a long-term power purchase agreement (PPA) for 300 Mw capacity of solar power generation to be set up in Gujarat. The PPA was awarded from its licensed distribution business unit towards fulfilment of its renewable purchase obligation (RPO).
To be commissioned within 18 months from the date of execution of the PPA, the project will have a tariff of Rs. 2.22/ kWh for a period of 25 years. According to Torrent Power, the cost involved in the project is about Rs. 1,250 crore.
Having entered the renewable energy space with a 50 Mw wind power plant in 2012, Torrent Power has to date implemented various renewable projects aggregating to around 786.5 Mw (648.5 Mw wind project and 138 Mw solar projects).

Tiger Global Makes its First India Cryptocurrency Firm Investment

CoinSwitch Kuber, an Indian cryptocurrency investment platform, has raised $25 million (Rs. 181 crore) in a Series B round of funding from Tiger Global Management, at a valuation of over $500 million.
This marks the New York-based Tiger Global's first investment in an Indian cryptocurrency company. This also makes CoinSwitch the highest-funded cryptocurrency player in India. It sets CoinSwitch on the growth trajectory of global cryptocurrency platforms like Coinbase and Binance in the Indian market.

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