NSE to auction investment limits of Rs 9,475 cr bonds

Jan 19, 2018 0

Mumbai– The National Stock Exchange (NSE) on Friday said it will auction debt investment limits to enable foreign investors to purchase corporate bonds worth Rs 9,475 crore.

The auction will be conducted on Monday (January 22) on its “nse-ebid” platform post-market hours from 3.30 p.m. to 5.30 p.m., the NSE said in a circular.

The leading bourse conducted a mock bidding session on Friday during market hours from 2.30 p.m. to post-closing at 4.30 p.m “to make members/custodians accustomed with bidding platform”.

The NSE said the total investment in corporate debt category reached Rs 215,848 crore on January 18 (Thursday) which is 95.79 per cent of total permitted limit of Rs 225,323 crore.

“Consequently, exchange shall conduct an auction for the allocation of unutilised debt limits on January 22, 2018,” it added.

The debt auction quota gives FPIs the right to invest in the debt up to the limit purchased. (IANS)


Read More

Wipro net falls 11% quarterly, 8% yearly for Q3

Jan 19, 2018 0

Bengaluru– Global software major Wipro Ltd on Friday reported Rs 1,940 crore net profit for the third quarter of fiscal 2017-18, registering 11.4 per cent sequential decline from Rs 2,190 crore a quarter ago and 8.3 per cent annually from Rs 2,115 crore in the same period year ago.

In a regulatory filing on the BSE, the IT major said gross revenue for the quarter under review at Rs 13,670 crore was marginally up (1.9 per cent) sequentially from Rs 13,420 crore quarter ago and flat annually from Rs 13,689 crore in the like period year ago.

Under the International Financial Reporting Standard (IFRS), net income was $303 million and gross revenue $2,141 million.

Revenue from IT services at $2,013 million was flat sequentially from $2,014 million quarter ago but 5.8 per cent up annually from $1,903 million in like period year ago.

Digital business contributed 25 per cent to IT services revenue, marginally up one per cent from 24 per cent quarter ago.

The IT services revenue is, however, less than the guidance of $2,014-2,054 million the company gave on October 17 for the quarter under review.

“The operating margin was impacted by a provision of Rs 318 crore ($50 million) for the insolvency of a customer,” said the company in a statement but did not disclose the customer’s name.

As a result of the bankruptcy impact, the operating margin in the declined 2.4 per cent to 14.8 per cent from 17.2 per cent due to the provision and 17.3 per cent quarter ago and 18.3 per cent year ago.

The adjustment towards the customer insolvency also impacted the net profit for the quarter.

For the fourth quarter, the company has projected revenue from IT services business in the range of $2,033-2,073 million.

“We continued to improve our growth trajectory, driven by strong momentum in BFSI (banking, financial services and insurance) and uptick in healthcare,” said Wipro Chief Executive Abidali Z. Neemuchwala in a statement later.

Though the company acquired 79 new customers during the quarter as against 41 quarter ago and 108 year ago, the total number of active clients declined to 1,281 in Q3 from 1,323 year ago.

“We made a strong progress in our client mining, with the number of them contributing revenues over $50 million increasing to 41 from 33 to 41 in the last one year,” said Wipro Chief Financial Officer Jatin Dalal.

The company generated robust operating cash flow of Rs 7,700 crore during the nine months (April-December) of the fiscal, an annual increase of 14.2 per cent over the same period year ago.

The IT services headcount declined to 162,553 at the end of Q3 from 163,759 quarter ago and 164,176 year ago, with the exit of 1,206 techies during the quarter and 1,623 during the last 12 months.

The company also declared 50 per cent interim dividend of Re 1 per share with a face value of Rs 2.

The company’s blue-chip scrip of Rs 2 face value ended at Rs 328.45 per share on the BSE when trading ended on Friday, gaining Rs 2.40 from Thursday closing price of Rs 326.05 and after opening at Rs 327.20. The scrip touched a high of Rs 330.30 and a low of Rs 321 during the intra-day trading. (IANS)

Read More

India’s Forex reserves rise by $2.7 bn

Jan 19, 2018 0

Mumbai– India’s foreign exchange (Forex) reserves rose by $2.70 billion as on January 12, 2018, official data showed on Friday.

The Reserve Bank of India’s (RBI) weekly statistical supplement showed that the overall Forex reserves rose to $413.82 billion from $411.12 billion reported for the week ended January 5.

India’s Forex reserves comprise of foreign currency assets (FCAs), gold reserves, special drawing rights (SDRs) and the RBI’s position with the International Monetary Fund (IMF).

Segment-wise, FCAs — the largest component of the Forex reserves — increased by $2.68 billion to $389.83 billion during the week under review.

Besides the US dollar, FCAs consist of nearly 20-30 per cent of major global currencies. It also includes investments in US Treasury bonds, bonds of other selected governments and deposits with foreign central and commercial banks.

The country’s gold reserves value remained stagnant at $20.42 billion.

However, SDRs inched up by $6.2 million to $1.52 billion. Similarly, the country’s reserve position with the IMF rose by $9.3 million to $2.04 billion. (IANS)

Read More

Mauritius largest FDI source in 2016-17: RBI

Jan 19, 2018 0

Mumbai– A census conducted by the Reserve Bank of India (RBI) on Friday showed that Mauritius was the largest source of FDI in India, followed by the US and the UK in 2016-17.

The revelation was made in RBI’s data on “Census on Foreign Liabilities and Assets of Indian Direct Investment Companies 2016-17”.

“Mauritius was the largest source of FDI in India (21.8 per cent share at market value), followed by the USA, the UK, Singapore and Japan,” the census report said.

“… Singapore (19.7 per cent) was the major FDI destination, followed by the Netherlands, Mauritius, and the USA.”

According to the data, manufacturing sector accounted for nearly half of the total FDI at market prices. Information and communication services, and financial and insurance activities were the other major sectors that attracted FDI.

Over 18,600 companies responded in the census.

“Ninety-six per cent of the responding companies were unlisted in March 2017 and most of them had received only inward FDI; unlisted companies had higher share of FDI equity capital vis-√†-vis listed companies,” the report said. (IANS)

Read More

Bank stocks lift equity indices to new highs amid trimming gains

Jan 18, 2018 0

Mumbai– Despite paring gains on the back of profit booking, the key Indian equity indices — the BSE Sensex and Nifty50 — managed to close at new highs on Thursday led by healthy buying in banking stocks.

According to market observers, positive Asian markets, coupled with inflow of foreign funds and upbeat quarterly corporate earnings, lifted the benchmark indices to record highs during the mid-afternoon trade session.

However, a sell-off during the last hour of trade pulled the benchmark indices lower from their highs to close with decent gains.

The wider Nifty50 of the National Stock Exchange closed above the vaunted 10,800-mark. The index edged higher by 28.45 points or 0.26 per cent to close at a new closing high of 10,817 points.

The Nifty50 scaled a new level of 10,887.50 points during the intra-day trade.

On the BSE, the barometer 30-scrip Sensitive Index (Sensex) closed at a new high of 35,260.29 points — up 178.47 points or 0.51 per cent — from its previous session’s close.

The Sensex also touched a fresh intra-day high of 35,507.36 points.

However, the BSE market breadth remained bearish as 2,301 stocks declined as compared to 663 advances.

In the broader markets, the S&P BSE mid-cap index fell sharply to close lower by 1.69 per cent and the small-cap index by 2.04 per cent.

“Markets ended with modest gains on Thursday after a positive opening. The main indices initially witnessed a gap-up opening on the back of positive Asian markets. A sell-off from the highs curbed the gains for the day,” Deepak Jasani, Head – Retail Research, HDFC Securities, told IANS.

“Nifty rose in the morning led by bank stocks on positive global cues and reports indicating that the government is mulling a proposal to hike foreign direct investment (FDI) limit in the banking sector,” he added.

Reports on Wednesday said the government could allow 100 per cent FDI in private banks and also consider increasing the permissible limit for FDI in public sector banks to 49 per cent from the current 20 per cent.

Anand James, Chief Market Strategist, Geojit Financial Services, said: “Government’s plan to not widen the net borrowings gave additional legs to market that has been pricing in the potential for further fiscal deficit slippage.

“FDI plans for banks and GST meeting also meant that indices opened with a gap-up, but such successive days of record peaks attracted profit booking following a mixed bag of earnings and approaching derivatives expiry.”

On the currency front, the Indian rupee strengthened by three paise to close at 63.85 against the US dollar from its previous close at 63.88.

Provisional data with the exchanges showed that foreign institutional investors purchased scrips worth Rs 1,894.99 crore, while domestic institutional investors divested Rs 657.46-crore scrips.

“The rally in banks was also supported by the government’s decision on Wednesday to trim additional market borrowing by 60 per cent for the ongoing fiscal year ending March,” Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.

Sectorwise, the S&P BSE banking index surged by 205.78 points, FMCG index by 79.15 points and finance index by 33.57 points.

On the other hand, the S&P BSE metals index slipped by 447.33 points, consumer durables index by 241.51 points, and oil and gas index by 220.70 points.

Major Sensex gainers on Thursday were: ITC, up 2.61 per cent at Rs 272.85; HDFC Bank, up 2.15 per cent at Rs 1,931.80; HDFC, up 1.99 per cent at Rs 1,897; Mahindra and Mahindra, up 1.83 per cent at Rs 758.70; and Kotak Bank, up 1.77 per cent at Rs 1,045.40.

Major Sensex losers were: Adani Ports, down 4.32 per cent at Rs 414.35; Tata Steel, down 2.89 per cent at Rs 751.85; Coal India, down 2.81 per cent at Rs 283.10; Sun Pharma, down 1.22 per cent at Rs 576.25; and State Bank of India, down 1.18 per cent at Rs 302.75. (IANS)

Read More

Tech Mahindra to acquire 17.5% stake in Altiostar Networks

Jan 18, 2018 0

Mumbai– IT major Tech Mahindra on Thursday said that it will acquire 17.5 per cent stake in US-based Altiostar Networks for $15 million.

According to a BSE filing, share acquisition will be made through its wholly-owned subsidiary Tech Mahindra (Americas) Inc, US.

“… the Investment Committee of the Board of Directors of the company has approved the proposal to acquire shareholding in Altiostar Networks, Inc., USA through its wholly owned subsidiary i.e. Tech Mahindra (Americas) Inc, USA,” the company said in the filing. (IANS)

Read More

Adani Power net loss widens to Rs 1,290.74 cr in Q3

Jan 17, 2018 0

Ahmadabad– Adani Power on Wednesday reported that its consolidated net loss for the quarter ended December 31, 2017 has widened to Rs 1,290.74 crore from Rs 667.89 crore loss in the year-ago period.

Revenue from operations during the quarter declined 10.8 percent to Rs 4,844.46 crore, compared to Rs 5,431.5 crore in same quarter of 2016-17.

EBIDTA (earnings before interest, tax, depreciation and amortisation) during third quarter (Q3) of 2017-18 (FY18) was Rs. 800 crore, as compared to Rs 1,364 crore in the same quarter of 2016-17 (FY17).

EBITDA during the quarter was lower due to arrears of transmission charges of Rs 287 crore not pertaining to the quarter, and lower fixed capacity charge revenue due to lower billed availability, the company said.

According to power producer, average Plant Load Factor (PLF) achieved during the Q3 of FY18 was 58 per cent, lower as compared to 69 per cent achieved in Q3 FY17.

Lower PLF during Q3 FY18 was as a result of lower domestic coal availability at Tiroda and Kawai and forced outage at Udupi, as well as scheduled maintenance.

Commenting on the quarterly results, Adani Group Chairman Gautam Adani said: “We expect to receive coal linkages under the Shakti scheme for the Tiroda and Kawai plants in the near future, which will help reduce fuel costs and improve profitability of these projects. Under-recovery of fuel costs for Mundra project have been impacted its financial viability, and we are in dialogue with key stakeholders for an early solution.”

He also said the power producer continues to progress steadily in pursuit of its future growth plans, while emphasising on efforts to improve efficiencies. (IANS)

Read More

India gives Asian Financial Forum a miss, for Davos

Jan 16, 2018 0

By Bhavana Akella

Hong Kong– India is missing at the Asian Financial Forum (AFF) event here, ostensibly because its ministers and officials have opted for the World Economic Forum (WEF) at Davos in Switzerland later this month, an official said.

“Indian ministers and officials declined our invite citing lack of time as they have to go for Davos for the four-day WEF from January 23-26,” a Hong Kong Trade Development Council (HKTDC) official told IANS here.

Preparations and meetings for the 2018-19 Union Budget presentation on February 1 has also been cited as another reason for the conspicuous absence of India at the 11th edition of the two-day financial summit being held at Hong Kong Convention Centre in downtown.

Nearly 100 speakers from the global financial community and about 3,000 delegates from around 50 countries, including China and US, are taking part in the forum organised by the Hong Kong government and the HKTDC.

Keynote speakers of AFF include the First Deputy Managing Director of International Monetary Fund (IMF) David Lipton, President of Asian Development Bank (ADB) Takehiko Nakao, President and Chairman of Asian Infrastructure Investment Bank (AIIB) Jin Liquin.

The previous editions of this annual forum had hosted the likes of former Reserve Bank of India Governor Raghuram Rajan, former chairman of the Securities and Exchange Board of India U.K. Sinha and global software major Infosys co-founder N.R. Narayana Murthy.

“We had invited some Indian financial officials and industry leaders to speak at the AFF, but they replied that they weren’t available for the event dates,” a HKTDC official told IANS here.

The council, however, did not reveal who all or how many Indian officials were invited.

However, there are about 10 Indian delegates from Mumbai representing the Institute of Chartered Accountants of India attending the 11th edition of the two-day forum.

A large group of Indian ministers and government officials would be taking part in this year’s WEF.

On January 23, Prime Minister Narendra Modi will be addressing an inaugural session at the 48th annual WEF.

An array of Indian ministers like Finance Minister Arun Jaitley, Commerce Minister Suresh Prabhu, Railways Minister Piyush Goyal, Petroleum Minister Dharmendra Pradhan and Minister of State for External Affairs Ministry M.J. Akbar will be part of the WEF meeting.

“As a country with such a large finance and start-up community, it is surprising to see such little Indian participation at this international forum,” Rajkumar Adukia, a Mumbai-based chartered accountant attending the AFF, told IANS here.

“If we want foreign investments coming into our country, we need to have Indian businesses and officials taking these fora seriously,” Adukia remarked.

The emerging financial technology (FinTech) sector in Asia and how it can transform the future of banking, the future of jobs in Asia, Artificial Intelligence (AI) and big data opportunities are some of the topics to be discussed at the two-day event.

With the US economy on the rebound and demand picking up worldwide, the platform would look at the impact of it on the rest of the world and how Asia could capitalise on the opportunities in the developed countries. (IANS)

Read More

It’s best to steer clear of Bitcoins lest the bubble bursts

Dec 12, 2017 0

By Amit Kapoor

It is impossible to make sense of the Bitcoin-mania that has been making waves of late.

In just a span of one year, the crypto-currency has doubled four times. The price of one Bitcoin in early January was $1,000 (almost Rs 64,000). It rose to $2,000 by May. In August, it breached $4,000. By late November, it was $8,000 and, two weeks later, it had crossed $16,000. Nothing short of a bubble can explain such an astronomical run. In fact, most recently, the market valuation of Bitcoin in South Korean markets briefly surpassed that of JP Morgan, the world’s largest bank.

The Bitcoin bubble is quite reminiscent of the myriad bubbles in global economic history beginning with the infamous Tulipmania of the 1600s. The tulip bulb bubble occurred in Holland during early 1600s when competing for the rarest tulip bulbs became a status symbol and speculation eventually drove its price to the extremes. At its peak, the price of tulip bulbs rose as much as 1,100 percent in a month. All of this came to an abrupt end in 1637 when prices dropped to an extent that bulbs began trading at a fraction of what they once had, miring many in financial ruin. All bubbles end in a similar fashion. Only the extent differs.

Olivier Blanchard and Mark Watson, in their 1982 paper “Bubbles, Rational Expectations and Financial Markets”, explain why assets like gold, just like Bitcoins, are prone to evolve into bubbles. First, gold acts as a hedge against inflation. This, however, is not true in the case of Bitcoins. The second reason that Blanchard and Watson give for a regular gold frenzy is that people base their choices on whether or not to hold an asset based on past returns rather than market fundamentals. Therefore, investors who witness a rise in asset prices believe that they can hold on to it themselves as long as it appreciates and get out of the market before the market crashes.

The latter reason holds true in the case of Bitcoins, which are largely being driven by such speculation. Even though the Blockchain technology behind the currency is revolutionary and could very well be the Next-Big-Thing, it does not explain the astronomical 16-fold rise that it has displayed this year. It would make sense if this trend were occurring in light of a broader loss in confidence in fiat money. But this is clearly not the case in the current global economic scenario, which finally seems to be picking up.

It can also be argued that since central banks have been practicing easy monetary policy since the crisis to revive economic activity, asset prices have displayed an upward trend. Therefore, in a market where stocks, bonds and other such assets are overvalued, Bitcoin is not an exception. Its rise can be merely a hedge against oncoming interest rate hikes. But, that does not explain why the rise in gold prices has not been similar. In fact, the rise in gold prices has been lower than that in stocks.

There is an additional aspect of the Bitcoin that might explain its widespread appeal: the anonymity involved in its transactions. Bitcoin transactions can be made securely without revealing one’s identity, which makes it easy to bypass the government eye altogether. If true, the rise of Bitcoins could point to a disturbing trend of breakdown of global institutions. The Bitcoin craze can be seen in conjunction with a spate of shocking election outcomes that have been witnessed globally which reflect a larger loss in confidence in institutions that have guided growth.

However, in such a case, the longevity of the currency will be dependent on the government’s appetite to allow such transactions. It is hard to imagine governments allowing large-scale anonymous transactions that evade any taxation and enable criminal activity. China has already banned the currency. On the other hand, Japan has made it legal tender in an attempt to become the global centre of fintech. The jury is still out on what course governments across the globe will take. American economist and chess Grandmasster Kenneth Rogoff put it best recently when he said: “The long history of currency tells us that what the private sector innovates, the state eventually regulates and appropriates.”

Either when the speculative run ends or governments decide to regulate, the Bitcoin dream run is bound to come to an end. It is best to steer clear of the dreaded eventuality. (IANS)

Read More

Linking bank accounts with Aadhaar mandatory, it is government’s decision: RBI

Oct 23, 2017 0

New Delhi– At a time when customers are rushing to link all their bank accounts with Aadhaar, the Reserve Bank of India (RBI) has clarified that it never issued any such directions, it was the decision of the Indian government.

The apex bank further clarified that in applicable cases, linkage of Aadhaar number to bank account is mandatory under the Prevention of Money-laundering (Maintenance of Records) Second Amendment Rules, 2017.

In a response to a Right to Information (RTI) Act application filed by Moneylife India and carried by it on October 18, the RBI said: “The Government has issued a Gazette Notification GSR 538(E) dated 1 June 2017 regarding Prevention of Money laundering (Maintenance of Records) Second Amendment Rules, 2017, inter-alia, making furnishing of Aadhaar (for those individuals who are eligible to be enrolled for Aadhaar) and permanent number (PAN) mandatory for opening a bank account. It may be noted that Reserve Bank has not yet issued instruction in this regard”.

Clarifying its position, RBI in a statement on Saturday said: “…in applicable cases, linkage of Aadhaar number to bank account is mandatory under the Prevention of Money-laundering (Maintenance of Records) Second Amendment Rules, 2017 published in the Official Gazette on June 1, 2017. These Rules have statutory force and, as such, banks have to implement them without awaiting further instructions.”

The government has made it mandatory to link bank accounts with the 12-digit biometric identification number. The deadline to do it is December 31, 2017.

This linking of Aadhaar to bank accounts is a process over and above the Know Your Customer (KYC) norms already followed by the banks.

Finance Minister Arun Jaitley in August had said that 524 million Aadhaar numbers had been linked to 736.2 million bank accounts in India.

Banks accounts in India are already linked to the tax-related Permanent Account Number (PAN), which is mandatory.

The Finance Minister had outlined a “one billion-one billion-one billion vision” for the country.
“That is one billion unique Aadhaar numbers linked to one billion bank accounts and one billion mobile phones. Once that is done, all of India can become part of the financial and digital mainstream,” Jaitley had said.

The RTI query further asked whether RBI had Supreme Court’s permission to mandatorily link Aadhaar with bank accounts. In its reply RBI said it had not filed any such petition before the Supreme Court. (IANS)

Read More