General Awareness

BUSINESS AND ECONOMY - October 2018

Oct 2018

Mar 20, 2019

Valeo Sets Up R&D Facility in Chennai

Global automotive technology supplier Valeo has set up a state-of-the-art R&D test lab facility at Navalur. The facility has come up at an investment outlay of Rs. 250 million.
The facility will further beef up the technical competence of R&D functions of Valeo. This will provide testing and prototype services to Valeo sites across the globe.

Hyundai and Kia to Invest in Ola

Hyundai Motor Company and Kia Motors Corporation will together invest $300 million in cab aggregator Ola.
This will be the biggest combined investment by the two firms of the South Korean Hyundai Motor Group.
As part of the strategic collaboration, the three companies will work on developing unique fleet and mobility solutions, besides building India-specific electric vehicles and infrastructure.
The partnership will offer Ola drivers various financial services, including lease and instalment payments, while vehicle maintenance and repair services are expected to enhance customer satisfaction.

Single Largest Foreign Investment in Sri Lanka

Sri Lanka announced that an overseas joint venture had committed $3.85 billion to a new oil refinery, the single largest foreign investment in the country's history.
According to the Board of Investment of Sri Lanka, the construction would shortly begin on the refinery and storage facility jointly financed by Oman's Ministry of Oil and Gas and a Singapore-registered company.
The refinery is expected to be fully operational within four years. Oman will fund 30% of the new oil project while Singapore-based Silver Park International, which is majority owned by a business interest in India, will finance the rest.

Builders Get GST Leeway

The GST Council, in its 34th meeting, decided to allow builders of properties under construction up to March 31, 2019, to choose between the old GST rate of 12% with input tax credits (ITC) and the lower rate without ITC announced in the previous meeting.
New constructions on and after April 1 will be taxed at the new rate.
The council had, in its previous meeting, said that the GST rate for under construction properties would be reduced and the option of availing input tax credit would be removed.
As such, it set the tax rate for normal under-construction residential properties at 5% without ITC, and the rate for affordable housing under construction projects at 1% without ITC.

Mar 19, 2019

ArcelorMittal Gets NCLAT Nod

The National Company Law Appellate Tribunal (NCLAT) gave a conditional go-ahead to a Rs. 42,000-crore offer by steelmaker ArcelorMittal to buy Essar Steel.
According to a two-member bench headed by Justice S. J. Mukhopadhaya, the acceptance of the resolution plan submitted by ArcelorMittal and partner Nippon Steel & Sumitomo Metal Corp. would be subject to its final order in the appeal filed by the promoters of debt-laden Essar Steel against the move.

L&T Mounts Bid for Mindtree

Larsen & Toubro Limited has mounted a Rs. 10,700-crore hostile takeover bid on mid-sized Bengaluru-based IT services company Mindtree.
The company announced to the exchanges that it had entered into a definitive share purchase agreement with V.G. Siddhartha and his related entities namely, Coffee Day Trading Limited and Coffee Day Enterprises Limited, to acquire 20.32% stake in Mindtree at a price of Rs. 980 per share, aggregating to approximately Rs. 3,269 crore.
L&T followed it up immediately with an order on its broker for purchasing up to 15% of Mindtree's equity from the market at a price not exceeding Rs. 980 per share.
Assuming it manages to put the deal through, that would cost it a further Rs. 2,414 crore.
It has also announced an open offer as per SEBI Takeover Regulations, to the public shareholders of Mindtree to purchase up to an additional 31% of the outstanding shares of Mindtree at a price of Rs. 980 per share in cash.
This would cost L&T a further Rs. 4,988 crore, taking the total outlay to Rs. 10,700-crore for a possible 66.32% stake in Mindtree.

Bandhan Bank to Acquire Gruh Finance

As per reports, Bandhan Bank has received no objection from the Reserve Bank of India (RBI) for the proposed acquisition of Gruh Finance.
Gruh Finance, the affordable housing finance arm of HDFC Ltd, was taken over in January by Kolkata-based Bandhan Bank in a share-swap deal.
As part of the deal, Bandhan Bank has to transfer 14.9 percent stake to HDFC for merging Gruh with itself.
The deal will allow Bandhan Bank's promoter Bandhan Financial Holdings to come down to about 61 percent from about 82 percent, and HDFC to hold around 15 percent in the merged entity from about 57 percent in Gruh.

RCom Pays Ericsson

Reliance Communications paid Rs. 460 crore to Swedish telecom equipment maker Ericsson, a day ahead of the March 19 deadline set by the Supreme Court.
Failure to adhere to the deadline would have invited a three-month jail term to Reliance Group chairman Anil Ambani.

Sharp Air-conditioners Gear Up for the Indian Market

Sharp Corporation of Japan has signed a distribution pact with Eltech Appliances Pvt. Ltd. (EAPL) for the Indian market. Under the pact, Sharp would initially unveil air conditioners that incorporate Sharp's Plasmacluster technology that eliminates germs and allergens present in polluted air.
The agreement is a reflection of the shared values of EAPL and Sharp.

Mar 18, 2019

T.N. Wooing HAL for Plant in Salem

The Tamil Nadu Government is impressing upon Hindustan Aeronautics Limited (HAL) to set up a manufacturing unit at Salem as the State has been chosen for establishing the Centre's ambitious defence corridor.
The move is a part of the Centre's 'Make in India' programme to catalyse indigenous production in defence manufacturing.

Wacoal to Invest Rs. 100 crore

Wacoal Corp. a Japanese company which is into premium lingerie products with global retail sales of $4 billion, has announced investment plans of Rs. 100 crore to expand its retail network in India in three years.
Wacoal's subsidiary, Wacoal India, which has been operating in India for four years, plans to grow its exclusive store strength from 12 to 70 by 2021 and add 80 more shop-in-shop stores, totalling 150 stores pan-India.

Schlumberger for Deviation in ONGC Tender

Schlumberger, the sole bidder in State-owned ONGC's tender for raising oil production from aging fields, has sought several deviations from bidding norms, including projection of a 26-27% decline in output in the next few years.
ONGC launched its initial tender for Production Enhancement Contracts in April 2018 for raising output beyond the business as usual scenario from two aging fields.

Mar 17, 2019

Blue Star Defers Plan to Set Up Unit

Air-conditioning and refrigeration major Blue Star Ltd. has deferred its plan to set up a greenfield project in Sri City by two years due to a slump in demand in recent months.

Wadhawan Global Sells Stake to Warburg

Wadhawan Global Capital (WGC) has decided to sell its entire stake of 49.04% in its education finance subsidiary, Avanse, to an affiliate of private equity firm Warburg Pincus Group, while Dewan Housing Finance Corporation Ltd., a group company, will also sell its 30.63% stake.
As part of the deal, WGC will be selling the entire 49.04% of its stake in the company.
DHFL, a WGC group company which holds 30.63% stake in Avanse, will also be exiting the company as a part of the transaction.

Sebi Slaps Fine on Sybly Industries

Markets regulator SEBI slapped a fine of over Rs. 10 crore on Sybly Industries Ltd. in a matter related to the manipulation in issuance of global depository receipts (GDR).
The penalty followed a probe by the SEBI regarding the firm's allotment of 1.51 million GDRs, amounting to $6.99 million, in June 2008.
The markets regulator found the entire 1.51 million GDRs were subscribed by one entity.

Grasim Industies Gets Tax Demand

Aditya Birla Group firm Grasim Industries received a Rs. 5,872.13 crore tax demand from the Income Tax Department with respect to its merger with Aditya Birla Nuvo and Aditya Birla Financial Services.
The DCIT held that as the demerger of the demerged undertaking is not in compliance with Section 2(19 AA) of the Act, the value of shares allotted by Aditya Birla Capital Ltd. (ABCL) to the shareholders Grasim Industries, in consideration of the transfer and vesting of the demerged undertaking into ABCL, amounted to dividend, within the meaning of the Act.

Mar 16, 2019

Trade Deficit Narrows

According to data released by the Commerce Ministry, a marginal 2.44% increase in exports as well as lower imports of gold and petroleum products in February, significantly narrowed the country's trade deficit to $9.6 billion.
India's merchandise exports rose to $26.67 billion in February from $26.03 in the year-ago month mainly on account of higher shipments in sectors such as pharmaceutical, engineering and electronics.
Imports declined by 5.4% to $36.26 billion in January, narrowing the trade deficit to $9.6 billion. The gap between imports and exports was $12.3 billion in February 2018, and $14.73 billion in January 2019.

Qualcomm to Pay Apple

A US court has ruled that Qualcomm owes Apple close to $1 billion in rebate payments.
In a preliminary ruling, the judge said that Qualcomm is obligated to make the rebate payments to Apple as they were part of a business agreement between the two companies.
As part of the 2013 Business Cooperation and Patent Agreement between the companies, the chipmaker made sizeable quarterly payments to Apple to offset its licensing fees until 2016.
Later, Qualcomm stopped making payments to Apple, before their contract ended, accusing the iPhone-maker of breaching their contract by involving government bodies like the Federal Trade Commission (FTC) into probing the chipmaker`s business practices.

ICRA Revises Rating for 6 PSBs

ICRA has revised the ratings outlook of six banks that have received substantial capital infusion from promoters.
The lenders are IDBI Bank, Bank of India, Bank of Maharashtra, Oriental Bank of Commerce, Punjab and Sind Bank, and Punjab National Bank.
Outlook for IDBI Bank, which has now been categorised as private sector lender by RBI following stake buy by Life Insurance Corporation of India from the government, has been changed to 'negative' from 'rating watch with developing implication'.
According to the ratings agency, the change in outlook is due to sizeable capital infusion by LIC, as part of its acquisition of a majority stake (51%).
With this capital infusion, ICRA expects IDBI's capital levels to remain above the regulatory levels going forward, thereby not posing any challenge for the servicing of its debt capital instruments.

Three Banks to Remain D-SIBs

SBI, ICICI Bank and HDFC Bank continue to be in the Reserve Bank of India's list of Domestic Systemically Important Banks (D-SIBs) for 2018.
D-SIBs are required to maintain higher capital as compared to other banks.
The additional Common Equity Tier 1 (CET1) requirement for D-SIBs has already been phased-in from April 1, 2016, and will become fully effective from April 1, 2019.

NCLAT Refuses to Stay Essar Steel Sale

The National Company Law Appellate Tribunal (NCLAT) refused to stay a bankruptcy court order approving steel giant ArcelorMittal's Rs. 42,000-crore takeover bid for Essar Steel and sought a fresh plan for the distribution of bid amount between financial and operational creditors of the debt-laden firm.
Essar Steel directors had challenged the Ahmedabad-bench of National Company Law Tribunal's (NCLT) nod to global steel giant ArcelorMittal SA's bid for the debt-laden company on the plea that their offer of Rs. 54,389-crore was superior as it clears 100% outstanding of both financial and operational creditors.
Standard Chartered too moved the NCLAT against the plan as its counsel contended that the bank was being given only 1.7% of its total dues from Essar Steel, while other financial creditors, forming part of the Committee of Creditors (CoC), were getting over 85% of their dues.

SBI Launches Cardless ATM Withdrawals

State Bank of India launched 'YONO Cash' for cardless withdrawal of cash at over 16,500 SBI ATMs across the country.
With this facility, customers can initiate the cash withdrawal process on the YONO app and set a six-digit YONO Cash PIN for the transaction.
They will also get a six digit reference number for the transaction on their registered mobile number via SMS. The withdrawal has to be completed in the next 30 minutes at the nearest ATM.

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