General Awareness

BUSINESS AND ECONOMY - October 2018

Oct 2018

May 20, 2019

BoB Looks to Rationalise Branches

State-owned Bank of Baroda (BoB) is considering the option of rationalising 800-900 branches across the country to improve operational efficiency, following its merger with Dena Bank and Vijaya Bank.
The merger of Dena Bank and Vijaya Bank with Bank of Baroda became effective from April 1.
There are cases where branches of three banks are at one location or one building. So these branches have to be either closed or rationalised as duplication is a drain on efficiency.

Orix to Buy Out Wind Energy Assets

Japan's Orix Corp., which owns 49% stake in each of the seven operating wind power plants of debt-laden IL&FS Group, has expressed its intent to buy out the remaining 51% stake held by IL&FS Wind Energy Ltd (IWEL).
Orix will exercise its right under the terms of an existing pact with IL&FS wherein Orix can match the price offered by the highest bidder to buy IWEL's stake in the wind power plants, IL&FS said in a release.
In April, state-run gas utility GAIL (India) Ltd had offered to pay Rs. 4,800 crore (as enterprise valuation) for the 874 megawatts (MW) wind portfolio, subject to Orix agreeing to the sale.
Orix, however, has now decided to buy out the remaining 51% stake by matching GAIL's offer. The sale process to Orix is expected to be completed by June.

IGI Airport Records Lowest Passenger Growth

Delhi airport, the busiest in the country, recorded the lowest growth rate in the last financial year in terms of passengers since 2012-13.
According to data released by Airports Authority of India (AAI), the Delhi airport handled 69.23 million passengers in 2018-19, 5.4% more than in 2017-18.
Before the 2018-19 financial year, the airport has maintained a consistent double-digit growth rate.
According to DGCA data, the industry witnessed the lowest passenger growth rate since June 2014 in March 2019.

May 19, 2019

Fortis' Healthcare Arm to Offload Stake

Fortis Healthcare's subsidiary Fortis Healthcare International will sell its entire stake in Medical and Surgical Centre Ltd. (MSCL).
Fortis Healthcare International Ltd. has entered into a share purchase agreement with CIEL Ltd., CIEL Healthcare Ltd. and MSCL, for sale of the entire shareholding (28.89%) held by FHIL in MSCL.

Baring PE Asia Buys Stake in NIIT Tech

Baring Private Equity Asia has acquired 30.5% stake in NIIT Technologies Ltd. for about Rs. 2,627 crore.
In April, funds affiliated to BPEA had signed pacts to buy 30.5% in NIIT Technologies from NIIT Ltd. and other promoter entities at Rs. 1,394 per share.
In a filing to BSE, NIIT Technologies said that Hulst B.V. acquired 18,848,118 equity shares of the company with face value of Rs. 10 each.
The Netherlands-registered Hulst B.V. is indirectly owned by funds affiliated with BPEA.

May 18, 2019

Spencer's to Buy Nature's Basket

RP Sanjiv Goenka Group-owned Spencer's Retail Ltd is set to acquire gourmet retail chain Nature's Basket Ltd. for Rs. 300 crore, as it seeks to expand its footprint in the Western region. The acquisition is subject to shareholders' approval.
The deal will give Spencer's access to 36 Nature's Basket stores in prime locations of Mumbai, Pune and Bengaluru. The Kolkata-based retail chain will also get access to Nature's Basket's online platform.
Nature's Basket, which began operations in 2005, sells fruits, vegetables, fish and meat, besides fast moving consumer goods (FMCG) and staples.

IHCL Ties Up with GIC

Indian Hotels Co. Ltd (IHCL), the owner of the Taj luxury hotel chain, signed a strategic partnership with Singapore's sovereign wealth fund GIC Pte Ltd to jointly invest around Rs. 4,000 crore over three years.
The equity contribution from IHCL will be at 30% and the balance will be contributed by GIC.
The acquisition will be housed in a separate special purpose vehicle (SPV), but will be managed by IHCL.
The hotels acquired within the framework will be managed by IHCL under its marquee brands.
This investment framework will complement IHCL's current growth aspirations via management contracts.

May 17, 2019

ICICI Probe Widens

The Enforcement Directorate (ED), investigating links between former ICICI Bank managing director and chief executive officer Chanda Kochhar and the Videocon Group, has expanded its probe into a total of 24 loans aggregating to Rs. 7,862 crore that, it believes, were loaned illegally and criminally by the bank to the conglomerate when she was in charge between 2009 and 2018.

Reliance-BP Combine Bids for Oil Block

Reliance Industries and its British partner BP Plc have made their first bid for an oil and gas exploration acreage in over eight years by bidding for one of the 32 blocks up for auction in the latest licensing round that saw mining major Vedanta putting in as many as 30 bids while state-owned ONGC bid count went to 20.
Bidding for 14 blocks on offer in the Open Acreage Licensing Policy (OALP) round-II and another 18 oil and gas blocks and 5 coal-bed methane (CBM) blocks on offer under OALP-III closed on 15 May 2019.
As per reports, Vedanta, which had won 41 of the 55 blocks offered under OALP-I in 2018, bid for 30 areas. Oil and Natural Gas Corp. bid for 20 blocks while Oil India Ltd. bid for 16. Indian Oil Corporation, GAIL (India) and SunPetro bid for 2 blocks each.

RBI Mandates Risk Officers

The RBI has asked all shadow banks with a size of over Rs. 5,000 crore to appoint chief risk officers (CROs) with clearly specified roles and responsibilities.
The CRO shall be a senior official in the hierarchy of an NBFC (non-banking finance company) and shall possess adequate professional qualification/experience in the area of risk management.
The CRO should be appointed for a fixed tenure with the approval of the board.
Removal or transfer will need the board's approval and has to be reported to the regulator.

May 16, 2019

Mirae invests over $100m in Indian startups

South Korean financial services firm Mirae Global Asset Management has invested a little more than $100 million across four transactions in India in its first year of operations, with its latest bet of $35 million on ridehailing major Ola.
The firm plans to continue its pace of investments in India's startup space, and is also exploring an India-dedicated fund.
Mirae had set up operations in April, 2018 after it roped in Ashish Dave, a former executive at venture capital firm Kalaari, to lead India investments, with a focus on mid- to late-stage transactions.
The firm has emerged as one of the most active investors with plans to invest $10-100 million in each transaction.

Single Monthly Return System for GST

The Union finance ministry is finally ready to move ahead with the single monthly return system for the Goods and Services Tax (GST), a move that will simplify the process of filing returns and also getting input tax credit.
The three-phase plan was announced in May 2018 to address complaints about the difficulties in filing multiple returns (and the higher cost of compliance).
According to that plan, for six months, in a transition phase, businesses would continue to file two returns, GSTR1 (for sales) and GSTR 3B , a summarised return form.
After six months, they would move to a single filing on a to-be-introduced form.
For consumer-facing businesses, the simplified form would be about total sales while for business-facing businesses, the form would incorporate invoice details.

Differences Between Co-founders at IndiGo

Differences have cropped up between the two promoters and co-founders of India's most successful and profitable airline IndiGo.
The development adds to the string of negative news emerging from the aviation sector.
The two, Rahul Bhatia and Rakesh Gangwal, have reportedly hired legal firms for dispute resolution.
It is learnt the differences between the two stalwarts of Indian aviation are over Bhatia possibly feeling that Gangwal is trying to gain greater control of Indi-Go by bringing in his own team as the low-cost carrier plans to expand its footprint globally.
Bhatia and Gangwal have hired JSA Law and Khaitan & Co, respectively.
The news of the differences comes against the backdrop of the turmoil in Jet Airways, which has shut services, hurting flyers in one of the fastest growing markets.
Rakesh Gangwal, a US citizen and non-executive director, is a veteran of the global aviation industry with over 30 years of experience and holds nearly 37% stake in the airline. Bhatia has about 38% stake.

NCLAT Admits HUDCO's Plea against Bakshi

The National Company Law Appellate Tribunal (NCLAT) admitted the intervention plea filed by HUDCO claiming dues of Rs. 195 crore from Vikram Bakshi, the estranged India partner of U.S.-based McDonald's.
A two-member bench headed by Chairman Justice S.J. Mukhopadhaya accepted the intervention plea filed by the Housing and Urban Development Corporation and urged the parties to settle the issue.
The bench listed the matter on May 27 for the next hearing. McDonald's had reached an out-of-court settlement to buy out Mr. Bakshi's Connaught Plaza Restaurants, which runs the restaurants chain of the U.S. major in north and east India, from their joint venture.

Taco Bell to Scale Presence in India

American quick service restaurant chain Taco Bell is set to scale up its presence in India, nine years after it opened its first store to serve Mexican food such as tacos and burritos in the country.
Taco Bell, part of American food services company Yum! Brands Inc., is planning to open 600 restaurants over the next 10 years, to make India its largest market outside the US.
Taco Bell finds more acceptance among India's urban consumers for cuisines beyond just burgers and pizzas.
Taco Bell announced Burman Hospitality Pvt. Ltd as its master franchise partner for India, making the New Delhi-based company the largest Taco Bell franchise globally by store count.

Tata Chemical Consumer Arm and TGBL to Merge

The boards of Tata Global Beverages (TGBL) and Tata Chemicals (TCL) have approved the demerger of the consumer products business of TCL and merging it with TGBL through a National Company Law Tribunal (NCLT)-approved scheme of arrangement to create one consumer products company, which will have a combined turnover and EBITDA of Rs. 9,099 crore and Rs. 1,154 crore, respectively.
As per the demerger scheme, each shareholder of TCL will get 1.14 new equity shares of TGBL for every one equity share held in TCL.

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