General Awareness

BUSINESS AND ECONOMY - October 2018

Oct 2018

Aug 23, 2019

Hero's Munjal in Advanced Talks to Invest in Ola Electric

Pawan Munjal might be the next big investor after Ratan Tata to invest in Ola Electric. Billionaire Pawan Munjal, chairman of Hero MotoCorp Ltd—India's largest two-wheeler maker by sales—is in advanced talks to invest in the electric mobility arm of ride hailing company Ola.
An investment in Ola Electric Mobility Pvt. Ltd would be a major endorsement of the future potential of electric mobility in India at a time when Prime Minister Narendra Modi's administration is pushing automakers and cab aggregators to shift to electric vehicles.
Sarin, a former chief executive of Vodafone Group Plc, was appointed as an independent director of Ola Electric in May 2019.
Sarin, an investor in Ola and Ola Electric, is also a mentor to Ola Electric.

Fuel Supply To Air India Stopped At Six Airports

Jet fuel supply to state-run carrier Air India has been stopped at six domestic airports because of unpaid dues to fuel provider, Indian Oil Corp (IOCL).
IOCL, for years, has propped up the debt-laden airline by infusing equity to keep it alive - the government injected 39.75 billion rupees ($553 million) into Air India in the fiscal year that ended on March 31, 2019.

S Korea Cancels Japan Intel Deal

South Korea will stop exchanging classified intelligence on North Korea with Japan amid a bitter trade dispute to set back U.S. efforts to bolster security cooperation with two of its most important allies in the Asian region.
South Korea's decision to cancel the intelligence-sharing pact will also further aggravate its ties with Japan, which are already at their lowest point since the two countries established diplomatic ties in 1965.
Tokyo lodged a protest with Seoul and calling the South Korean move "extremely regrettable" and "unbelievable."

Amazon Picks Up 49% Stake In Future Coupons

Kishore Biyani-led Future Group, Amazon acquired a 49% stake in a group entity Future Coupons Ltd. Amazon has agreed to make an equity investment for stake comprising both voting and non-voting shares.
The promoters have also agreed to certain share transfer restrictions on their shares in the Future Retail for the same tenure.
Future Retail operates Biyani's popular retail chain of Big Bazaar and other smaller format retail outlets under EasyDay and Heritage Fresh across more than 400 cities through digital platforms and over 1,500 stores.
The retail chain operator recorded a revenue of ₹5,149 crore, a y-o-y jump of 13.5% over the same period in 2018.

RBI Cuts a Cheque For Epay Companies With Recurring Payments

Digital payment companies like Paytm, Razorpay and card schemes like Visa, Mastercard are eyeing new avenues of business as the Reserve Bank of India has allowed consumers to make recurring payments of up to Rs 2,000 by giving an e-mandate.
This means one can set auto pay instructions for small-value repetitive transactions such as subscription payments and bill payments on mobile wallets or debit and credit cards without having to put in the second factor of authentication every time a payment is made.
It has been decided to permit processing of e-mandate on cards for recurring transactions (merchant payments) with AFA (additional factor of authentication) during e-mandate registration, modification and revocation, as also for the first transaction.

SEBI Announces Reward Of Rs 1 Crore To Insider Trading Informants

The Securities and Exchange Board of India (SEBI) has announced a reward of upto one crore rupees for informants willing to provide credible information regarding insider trading cases.
This will be a part of the detailed set of rules for the new 'Informant Mechanism' under Prohibition of Insider Trading Regulations that was approved by the SEBI board.
The norms also propose a possible amnesty or settlement for minor wrongdoings in return for cooperation in the probe.
SEBI will establish an Office of Informant Protection, which will be responsible for the receipt, registration and processing of the disclosure form and also for ascertaining its authenticity.
Other major decisions include relaxation in 'Muni Bonds' to enable smart city developers and municipalities to raise funds through issuance and listing of their debt securities.

World Bank Bans Chinese Companies For Financial Crimes

The World Bank debarred China Railway Construction Corporation and its wholly owned subsidiaries, China Railway 23rd Bureau Group Co and China Railway Construction (International), for nine months, citing misconduct during the procurement process for the 'East-West Highway Corridor Improvement Project' in Georgia.
This project is part of China's mega Belt & Road Initiative (BRI).

Aug 22, 2019

SEBI Eases Buyback Norms For Firms With HFC, NBFC Units

Capital markets regulator Securities and Exchange Board of India (SEBI) announced easing of its norms for buyback of shares by listed companies, especially those having subsidiaries in housing finance and non-banking finance companies (NBFC) sectors.
A proposal in this regard was approved by SEBI's board at its meeting. The repurchase of shares by listed companies is governed by the Buyback Regulations of Sebi as well as the Companies Act.
Among the main conditions that the companies need to follow, the buyback offer cannot exceed 25% of the aggregate paid-up capital and free reserves of the company, but shareholders' approval is required through a special resolution in case the size exceeds 10%.
SEBI's proposal to amend its regulations also follow a notification by the corporate affairs ministry permitting government companies carrying out non-banking finance and housing finance activities to launch buybacks resulting in up to 6:1 debt to equity ratio post the share repurchase.

Amazon Opens Its Largest Office Building Globally In Hyderabad

E-commerce giant Amazon formally opened its largest campus building anywhere globally in Hyderabad, a facility spread over 9.5 acres and comprising three million square feet of built up area.
The new campus is Amazon's first owned office building outside the U.S. and is the single largest building globally. The office space of 1.8 million sq ft can seat 15,000 people.

ITC Weighs Buying Stake In Coffee Day

ITC Ltd is considering a bid to buy a stake in Coffee Day Enterprises Ltd as the nation's biggest cigarette maker seeks to diversify its businesses.
The maker of Classic and Gold Flake cigarettes has been given access to Coffee Day's assets and financial for due diligence.
ITC could be vying with CocaCola Co., which has evaluated India's biggest cafe chain.
Shares of ITC closed 2.01% lower in Mumbai, while Coffee Day rose 4.97%, extending its three-day winning streak to almost 16%.
A successful bid will help ITC further diversify its business to reduce dependence on cigarettes as India raises taxes on tobacco and restricts smoking in public places.
Coffee Day is under pressure to pare borrowings after its founder VG Siddhartha took his own life as debt strains began to emerge in his companies.

RTGS System For Customer Transactions To Open At 7 Am

Transfer of funds through the high-value RTGS system will be available from 7 am instead of 8 am from August 26, 2019.
At present, the Real Time Gross Settlement (RTGS) System is available for customer transactions from 0800 hours to 1800 hours and for inter-bank transactions from 0800 hours to 1945 hours.

Gaming Firm Nazara Tech Acquires Sportskeeda

Mobile gaming platform Nazara Technologies has acquired a majority stake in sports content website Sportskeeda.com, continuing its string of acquisitions and investments in the sports and internet space.
Nazara has invested ₹44 crore for a 67% stake, valuing the popular sports content portal at about ₹65 crore.

SEBI Simplifies KYC Requirements For Foreign Investors

Easing the regulatory framework for foreign portfolio investors (FPIs), the Securities and Exchange Board of India (SEBI) simplified know your customer (KYC) requirements for them and permitted them to carry out off-market transfer of securities.
The proposals were cleared by the SEBI's board during its meeting as part of efforts to simplify and expedite the registration process for FPIs.
Apart from doing away with the broad-based eligibility criteria for institutional FPIs, under the new framework, FPIs would be classified into two categories instead of three.
FPI regulations have been redrafted based on the recommendation of a committee headed by former Reserve Bank of India deputy governor HR Khan.
The requirements for issuance and subscription of offshore derivative instruments have also been rationalised.

China To Soon Launch Its Own Cryptocurrency

The People's Bank of China (PBoC) is "close" to issuing its own cryptocurrency.
The bank's researchers have been working intensively to develop systems, and the cryptocurrency is "close to being out."
The digital currency would replace M0, or cash in circulation, rather than M2, which would generate credit and impact monetary policy.
The digital currency would also support the yuan's circulation and internationalization.
PBoC is inching toward formally introducing a digital currency of its own after five years of research.
Facebook Inc.'s push to create cryptocurrency Libra has caused concerns among global central banks, including the PBoC. The digital asset must be put under central bank oversight to prevent potential foreign exchange risks and protect the authority of monetary policy.

Aug 21, 2019

Government removes Debenture Redemption Reserve requirement for Listed Companies, NBFCs and HFCs

Debenture Redemption Reserve for unlisted companies reduced to 10% of outstanding debentures from the present level of 25%
The Ministry of Corporate Affairs has amended the Companies (Share Capital & Debentures) Rules by removing Debenture Redemption Reserve requirement for Listed Companies, NBFCs and HFCs.
The decision has been taken in pursuance of the Budget announcements for 2019-20 by Union Finance & Corporate Affairs Minister Nirmala Sitharaman and the Government's objectives of providing greater 'Ease of Doing Business' to companies in the country, as part of its 100 Days Action Plan.

Shell Exits City Gas Biz, Sells Stake To Mgl For ₹770 Crore

Shell India, the local arm of Royal Dutch Shell Plc, sold its 10% stake in the city gas distribution business of Mumbai-based Mahanagar Gas Ltd (MGL) for ₹770 crore.
BG Asia Pacific Holdings, a wholly owned subsidiary of Shell, sold 9.98 million shares through block deals at ₹780 each.
Other key shareholders of Mahanagar Gas are state-run gas utility GAIL (India) Ltd and the Maharashtra government.
Mahanagar Gas sells compressed natural gas (CNG) to retail outlets and piped natural gas (PNG) to households and industries in and around Mumbai.

TVS Launches 19 Premium Tyres Under Eurogrip Brand

TVS Srichakra Limited announced the launch of the brand 'TVS Eurogrip'.
Under the TVS Eurogrip umbrella, the company launched a portfolio of 19 premium tyres that include zero-degree steel-belted radial tyres.
The company claims that the performance tyres provide stability at high speeds and are rated to run at speeds up to 270 kmph.

SBI Desires To Eliminate Debit Cards To Make Way For Digital Payments

Chairman of State Bank of India, Rajnish Kumar said In the next five years, there will be a limited need to have any plastic cards in your pocket.
Through the Yono platform, one can withdraw cash at the automated teller machines.
He said there are around 90 crore debit cards in the country as against 3 crore credit cards, and pointed out to digital solutions like its own 'Yono' platform as the key for achieving a debit card-less country.
Bank has already set up 68,000 'Yono cashpoints' and is in the process of scaling it up massively to over 1 million in the next 18 months, which will make the necessity to have a card even less.

Aug 20, 2019

Hero Electric Launches Two High-End e-Scooters

One of the oldest and largest electric vehicle makers in the country, Hero Electric launched two new e-scooters -- Optima ER and Nyx ER (Extended Range) -- expanding its range of heavy duty and high-speed e-scooters in India.
The Optima ER and Nyx ER are now available across company's dealerships, priced at Rs 68,721 and Rs 69,754, respectively.

Policy Anomaly Tilts CSR Scales In Favour Of 6 States

Just six states — Maharashtra, Karnataka, Andhra Pradesh, Gujarat, Tamil Nadu and Delhi — have cornered a lion's share of the Rs. 52,208 crore in funds spent on corporate social responsibility (CSR) activities by companies because of a policy anomaly that needs to be rectified.
The six states host only 11% of 117 so-called "aspirational districts", yet they appropriated around 40% of the CSR funds actually spent on CSR by companies between 2014-15 and 2017-18.
Only 9% of the CSR money reached 55% of the aspiration districts located in Jharkhand, Bihar, Chhattisgarh, Madhya Pradesh and Uttar Pradesh.
Prime Minister Narendra Modi launched the Aspirational District Programme (ADP) on January 5, 2019 to rapidly transform underdeveloped districts lagging behind the rest of India on key parameters such as health, nutrition, education, financial inclusion, and basic infrastructure.
The committee, chaired by corporate affairs secretary Injeti Srinivas, admitted that a policy anomaly was partly to blame.

SEBI To Ease Buyback Norms For Firms With NBFC Units

Capital markets regulator Securities and Exchange Board of India (SEBI) is planning to ease its norms for buyback of shares by listed companies, especially those having subsidiaries in housing finance and non-banking financial companies (NBFC) sectors.
A proposal in this regard is expected to be discussed by SEBI's board at its meeting .
The repurchase of shares by listed companies is governed by the Buyback Regulations of SEBI as well as by the Companies Act.
The buyback offer cannot exceed 25% of the aggregate paid-up capital and free reserves of the company, but shareholders' approval is required through a special resolution in case of the size exceeding 10%.

Govt Panel Recommends Tax Relief For Middle Class

A government panel tasked with overhauling the nearly six-decade-old Income Tax Act recommended significant relief for taxpayers, including an across-the board 25% tax rate for both local and foreign companies and changes in personal tax slabs to benefit middle and upper middle class Indians.
The draft code also proposes incentives to startups and a new concept of settling disputes through mediation between the taxpayer and a collegiums of officers.
The proposed corporate tax reduction will apply to both large local as well as foreign companies that are present in India without a subsidiary and are taxed at 40%. Unlike domestic firms, foreign companies pay a higher corporate tax rate, but do not have to pay dividend distribution tax that is applicable to domestic companies.
At present, domestic companies with sales of as much as Rs. 400 crore pay a lower 25% rate and bigger companies, which account for the lion's share of the government's tax revenue, pay 30%, excluding the surcharge and cess on the income-tax outgo.

DHFL Parent WGC Sells Loan Distribution Biz To Metdist

Wadhawan Global Capital (WGC), the parent of cash-strapped Dewan Housing Finance Corp. Ltd (DHFL), is selling its loan distribution business Andromeda Sales and Distribution Pvt. Ltd to London-based metal trading firm, Metdist Group of companies for close to Rs. 150 crore.
The sale of Andromeda is part of WGC's attempts to raise capital to meet debt obligations at the group's flagship company DHFL.
The group, which has been on a selling spree ever since a liquidity crunch hit Indian non-bank lenders, has so far sold its affordable housing finance business Aadhar Housing Finance Ltd to PE firm Blackstone and education financing firm Avanse Financial Services Ltd to American private equity firm Warburg Pincus.

Aug 19, 2019

Tesla Shows Interest In India's Big Battery Plan

Tesla and China's Contemporary Amperex Technology Co. Ltd (CATL) are among the companies that have shown an initial interest in the Indian government's plan to build large factories to make lithium-ion batteries at an investment of about Rs.50,000 crore.
Among the other firms that have shown an interest in the mega project is China's BYD Co. Ltd.
The robust global interest comes amid a strong push by the government to make India a global manufacturing hub for electric vehicles and their components.
This is aimed at arresting the South Asian country's reputation as the world's third-largest crude oil importer, saving on precious foreign exchange and also controlling pollution in its major cities.

Chryscap, Everstone In Talks To Buy Health IT Co.

Private equity majors ChrysCapital and Everstone Capital are in the fray to acquire a majority stake in healthcare technology firm eMids at a valuation of $200-250 million.
Baring Private Equity Asia is also in talks to acquire the 20-year-old company, founded by former Wipro executive Saurabh Sinha. Credit Suisse is advising the company on the deal.
Sinha, who owns around 25% stake in the company, is expected to stay in the company after the deal.
eMids also has several individual investors, while it raised $13 million in funding from US-based investment firms Baird Capital and Council Capital in 2013.
eMids is currently doing about $80-90 million in revenues.
eMids caters to payers and providers, bridging gaps in the healthcare system through data and analytics at the centre of its tech platform.

Tech Mahindra Divests 73% Stake In Unit For $2 Mn

Software company Tech Mahindra Ltd announced the divestment of 73.38% stake in its subsidiary FixStream Networks Inc. to US-based firm Resolve Systems LLC for $2 million (approximately Rs.14.22 crore).
Tech Mahindra said FixStream Networks Inc. reported a revenue of $5.15 million and a loss of $5.19 million in FY19.
The transaction is expected to be completed by November 15, 2019, subject to receipt of all statutory approvals.

Amazon To Use Prime Now For Food Delivery Launch

Prime Now, Amazon's two-hour grocery delivery platform, could be the primary vehicle for its foray into food delivery business in India. Amazon has also held preliminary talks with Ola's food delivery unit Foodpanda for a potential partnership for this business which could be extended to an acquisition.
They have also held talks with Uber Eats.
Prime Now, which was earlier known as Amazon Now, will serve as a platform focusing on high-frequency use cases of both food and grocery delivery, as Amazon looks to capture a bigger share of urban consumers.

Maruti Seeks Tax Relief For Hybrid, CNG Cars

The country's largest carmaker Maruti Suzuki India (MSI) is pitching for tax relief for hybrid and compressed natural gas (CNG) cars in addition to electric vehicles (EVs) in order to promote green mobility in the country.
There is a need to promote hybrid and CNG cars as it will take some time for mass acceptance of electric vehicles considering the high cost of technology right now.
The hybrid cars are 25-30% more efficient and will help reduce oil imports.

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