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5/19/2018 13
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CMYK
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BUSINESS
13THE HIN DU F RIDAY, J AN UARY 2 , 2 0 15NOIDA/DELHI
BRIEFLYLIC to launchco-branded creditcard with UAE bank
DUBAI: LIC Internationaland Abu Dhabi-based FirstGulf Bank are planning tointroduce a unique co-branded credit card in theUAE to address concerns ofinsurance policyholders.
LIC Internationalhas over350 million policyholdersworldwide. PTI
Airtel opens bookingsfor Redmi NoteNEW DELHI: To give a fillip toits super fast fourth-
generation mobile services,Bharti Airtel has tied upwith Chinese handsetmaker Xiaomi to provide4G device Redmi Note at aprice of Rs.9,999 in sixcities.The operatorprovides 4G services in 16cities, but Airtel willprovide Redmi Note at 133stores across Mumbai,Bengaluru, Hyderabad,Chennai, Delhi-NCR andKolkata. PTI
SRF acquiresDuPonts Dymelpharma propellant biz
NEW DELHI: Diversified firmSRF, on Thursday,announced the acquisitionof U.S.-based DuPontspharmaceutical propellantbusiness under the Dymelbrand for $20 million (overRs.120 crore) in an all-cashdeal. The company hassigned a definitiveagreement with E I DuPontDe Nemours and CompanyUSA for the transaction,SRF said in a filing to theBSE. PTI
House panel tovisit DunlopKOLKATA: TheParliamentary StandingCommittee on Commerce,headed by Rajya Sabha MPChandan Mitra, will soonpay a visit to DunlopIndias Sahaganj unit onJanuary 5 to explorerevival options.The committee will visitthe factory as part of itsfact-finding review of WestBengalss rubber and tyreindustry, Mr. Mitra toldPTI.
Central Bank
revises rates on
FCNR deposits
NEW DELHI: Central Bank ofIndia has revised theinterest rates on ForeignCurrency Non-resident(Bank) Account (FCNR-B).The new rates will beapplicable from Thursday,the bank said in a release.The bank now offersinterest of 3.82 per cent ondollar deposits, 3.5 per cent
on pound deposits, 2.41 percent on euro deposits, 3.86per cent on Canadiandollar deposits and 4.74 percent on Australian dollardeposits (all of five-yearmaturity).These revised rates arevalid till January 31. PTI
EXCHANGE RATES
Indicative direct rates in rupees a unitexcept yen at 4 p.m on January 01
Currencies TT TTBuying Selling
U.S. Dollar 63.15 63.47Euro 76.39 76.79Pound S terling 98.20 98.71J ap Ye n (10 0 Uni ts ) 5 2. 76 5 3. 04Chinese Yuan 10.17 10.23Swiss Franc 63.47 63.80S in ga po re D ol la r 4 7. 62 4 7. 91A us tr al ia n D ol la r 5 1. 56 5 1. 86C an adi an D ol lar 5 4. 31 54 .61Swedish Kroner 8.06 8.11Danish Kroner 10.26 10.31New Ze al an d Dol la r 4 9. 33 4 9. 61Hongkong D ollar 8.14 8.18M al ay si an Ri ng it t 1 8. 06 1 8. 15K uw ai ti Din ar 21 5. 31 2 17 .14UAE Dirham 17.19 17.28B ah ra in i D in ar 1 67 .4 4 1 68 .3 6Qatari Riyal 17.40 17.41Saudi Riyal 16.88 16.89Omani Riyal 164.00 164.86
Source: Indian Bank
BULLION RATES
January 01 rates in rupees withprevious rates in brackets
ChennaiBar Si lver (1 kg) 35,965 (36,910)Retail (1 g) 38.50 (39.50)24 ct gold (10 g) 26,990 (27,180)
2 2 c t g ol d ( 1 g ) 2 ,5 24 ( 2, 54 1)DelhiSilver 36,200 (37,000)S tandard gold 27,100 (27,200)S ov er ei gn 23 ,7 00 ( 23 ,7 00 )
cided with somemodifications. These includeasking the small tea growersto give a declaration of theiroutput conforming to thePPC before it is sent to thefactories. This was necessaryas currently this sector ac-counts for over 30 per cent ofthe Indian tea output.
The awareness campaign,now on among small teagrowers, would be continued,a Tea Board said.
It may be mentioned herethat recently Greenpeace hadreleased a report allegingpresence of pesticide resid-ues in Indian tea. The Tea
Board and industry had flayedthe report.
The PPF, evolved by TeaBoard, has detailed the chem-icals that can be used in teaplantations making some ex-ceptions for South India. Itsaid that chemical use shouldbe restricted not only in teaestates, but also near waterbodies, wildlife habitats andhuman dwelling to check con-tamination.
PPF covers insecticides,fungicides, herbicides and biopesticides. Tea Board notedthat in spite of using PPFs,the tea industry loses nearly30 per cent of its crop due topests, weeds and diseases.The tea research institutes,which were engaged in thePPF exercise, have ensuredthat their recommendationscomply with food safety stan-dards as stipulated by theFood Safety & Standards Au-thority of India.
KOLKATA: Plant ProtectionCode (PPC), a set of guide-lines for regulating the chem-ical inputs in tea cultivation,was rolled out on January 1,2015. The aim is to make Indi-an tea a safe and healthydrink.
The PPC is a comprehen-sive document, which dealswith safe usage of crop pro-tection products and metho-dologies that would befollowed to reduce pesticideresidues in tea.
The code encourages teagrowers to critically reviewtheir plant protection formu-lations (PPF), which are a listof chemicals that are used intea. The code is based on theCodex Alimentarius, which isa set of international foodstandards and guidelines.
Tea Board Chairman Sidd-harth said a roll-out was de-
Plant Protection Code rolls outto make tea a safer beverageIndrani Dutta
The document dealswith safe usage ofcrop protectionproducts andmethodologies
MUMBAI: The benchmarkSensex on Thursday endedwith a marginal gain of about8 points at 27507.54 in thefirst trading session of theNew Year in lacklustre trade.
Traders said direction-lessinvestors confined their com-mitments to select stocks,having strong fundamentalsamid most Asian financialmarkets remaining closed.On Wednesday, marketsclosed higher for the fourthstraight day and wrapped up2014 with the best annualgain in five years.
Telecom, auto, infrastruc-ture and metal sector stockssaw some activity onThursday.
After a lower start at27485.77, the 30-share BSESensex slipped further to27395.34. However, losseswere wiped off on the back of
gains in select blue-chips to-wards the fag-end.The Sensex closed at
27507.54 after touching ahigh of 27545.61.
Bharti Airtel counteremerged the top gaineramong Sensex stocks by surg-ing 2.86 per cent after thetelecom regulator recom-mended base price forRs.2,720 crore/megahertz for3G mobile spectrum.
The 50-share Nifty on the
National Stock Exchangeedged up by 1.30 points to8284 after moving between8294.70 and 8248.75intra-day.
Meanwhile, foreign portfo-lio investors bought sharesworth Rs.481.08 crore onWednesday.
Among auto stocks, MarutiSuzuki gained after it report-ed a 20.8 per cent increase intotal sales in December. Oth-er auto stocks such as M&M,
Bajaj Auto, Hero MotoCorpand Tata Motors also endedin positive terrain. In metalspace, Sesa Sterlite was up2.34 per cent. PTI
Sensex flat on Day One of New Year
Stock brokers hope the bull run will extendin 2015 PHOTO: VIVEK BENDRE
MUMBAI: The Indian rupeewas off to a bad start in thenew year as it suffered theworst single-day drop inover two weeks on Thurs-day by falling 32 paise toend at 63.35 against thedollar.
Demand for the green-back from banks and im-porters and little supportfrom local share market,where benchmark indicesended almost flat, led to ru-pee snapping a two-session
uptrend. The dollar gainedstrength overseas againstmost peers on speculationthat U.S. Federal Reservewill raise rates by the mid-dle of this year, said forextraders.
On Wednesday, the ru-pee had gained 35 paiseagainst the greenback butlost ground on an annualbasis for the fourth year ina row. In the previous twosessions, the rupee hadgained 64 paise. PTI
Rupee tumblesconstruction and infrastruc-ture sector.
Major and secondary pro-ducers such as SAIL, RINL,JSW, JSPL and Monnet Ispathave started adding capacity.
City-headquartered Rash-triya Ispat Nigam Ltd., thecorporate entity of the Visak-hapatnam Steel Plant, isramping up new units underits 6.3-million tonne expan-sion project at a cost ofRs.12,500 crore. When con-tacted on threat of imports,RINL Director (Commercial)
T. K. Chand underlined theneed for cost reduction andquality.
He told The Hindu that2015 may prove to be a yearof turnaround for the steel in-dustry with business senti-ment firming up, and thegovernment going ahead withits growth agenda. He saidthe industry might be de-cou-pled from the global trend ofslowdown, and was likely toregister growth in tandemwith GDP growth.Twenty in-dustrial clusters such as Ben-
galuru-Mumbai as well asVizag-Chennai, seven indus-trial cities and 100 smart ci-ties are expected to accelerategrowth in manufacturing.The rural market is also look-ing up for long producers.
It is estimated that around17 million tonnes of addition-al capacity are likely to beadded in the next 2-3 years,around five million tonnes onan average a year in longproducts as against the earli-er average of maximum twomillion tonnes a year.
VISAKHAPATNAM: The steel in-dustry, hit by slowdown inthe last couple of years, is ex-pecting to bounce back in2015.
The industry is boggeddown due to cyclone Hudhudmainly in the second-half of2014.
Besides, the industry isfaced with surging Chineseimports and sluggish domes-tic demand due to excess sup-ply and slowdown in the
Steel units expect turnaroundSantosh Patnaik
NEW DELHI: The governmenthas extended duty-free im-port of chana, also known asgram or chickpeas, till March-end in view of fall in sowingarea under the crop.
The Finance Ministry hasextended the zero duty re-gime for chana although theAgriculture Ministry waspushing for a 10-per cent dutyin view of declining chanaprices, which have fallen evenbelow the minimum supportprice of Rs.3,100 a quintal insome parts of the country.
In a notification, the Cen-tral Board of Excise and Cus-toms (CBEC) said it hadextended the zero customsduty on chickpeas (gram) upto March 31.
The zero duty on importedchana was valid tillWednesday.
At p resent, pulses are im-ported at zero duty across theboard for any category.
Similarly, export of pulsesis prohibited except for chick-peas (Kabuli chana) and orga-nic pulses. PTI
Duty-freeimport ofchana allowedtill March
MUMBAI: The banking sector isfaced with downgrading ofrating as deteriorating assetquality would put furtherpressure on its finances, makeinternational operations andfunding much more difficultduring 2015, said the Associ-ated Chambers of Commerceand Industry of India (Assco-ham) in a report Non per-forming assets: current andexpected scenario.
Considering this, the re-port said, the banking sector
would attract additional pro-visioning, which would fur-ther put pressure on theprofits of banks, which are al-ready under tremendousstress. This would reducethe effective internal sourceof increasing capital which is
even under a lot of pressureon account of the impendingBasel-III guidelines and thecapital adequacy ratio is ad-versely affected, the reportsaid.
Gross NPAs
As per the report, the grossnon-performing assets(NPAs) of banks are expectedto be 4.4 to 4.7 per cent forpublic sector banks by March,2015, (as against 4.4 per centas on March, 2014) and 4-4.2per cent for the whole bank-ing sector (as against 3.9 per
cent for March, 2014).The year 2013-14 saw in-cremental restructuring ofRs.1.20 lakh crore, and Asso-cham believes that the samefigure would be maintainedfor 2014-15.
Weak asset in the banking
sector is likely to be 5.7 percent by March, 2015, as com-pared to 5.6 per cent inMarch, 2014, and 4.3 per centin March, 2013, bad and res-tructured loans are expectedto touch the 15 per cent markby the end of 2014-15, thereport said.
According to the report,standard assets incrementalrestructuring would continuein 2014-15 and not muchheadway is expected in sale ofassets to assert reconstruct-ion companies after the gui-delines have been changed.
For reducing NPAs, Asso-cham has suggested a four-pronged strategy for earlyrecognition of stress and re-medial action thereafter. Themeasures are categorised un-der preventive and correc-tive Management, it said.
Deteriorating asset quality willput pressure on bank financesSpecial Correspondent
NEW DELHI: Even as major carmakers such as Maruti Suzukiand Hyundai Motor posteddouble-digit growth in do-mestic sales in December, theCentres decision not to ex-tend excise duty benefits hasput the industry on the backfoot.
As an interim measure togive a boost to the strugglingautomobile industry, the gov-ernment had announced a cutin the range of 4 to 6 per centin excise duty on variousvehicles.
Hike in prices
While most of the p layershave already announcedplans to hike prices due toincreasing input costs, withthe concession lapsing, thequantum of price rise couldbe over Rs.20,000 for smallcars and around Rs.40,000for sedans.
Countrys largest car mak-er Maruti Suzuki reported a13.3 per cent year-on-year in-crease in domestic sales at
98,109 units in December2014, while Hyundai MotorIndias sales were up 14.7 percent at 32,504 units. ToyotaKirloskar Motor (TKM) said
it sold 11,740 units lastmonth, a growth of 10.25 percent.
In continuation of the No-vember upswing, we have reg-istered growth in the
domestic and overall sales inDecember as well. This mo-mentum can be attributed tothe year ending, Toyota Kir-loskar Motor Senior Vice-
President (Sales and Market-ing) N. Raja said.
On the other hand, Mahin-dra & Mahindras vehiclesales declined by 7 per cent to34,460 units. The company,
however, reported growth of5 per cent in sales of passen-ger vehicles, including Scor-pio, XUV 500, Xylo, Boleroand Verito.
We are happy to haveachieved a growth of 5 per
cent in our passenger vehiclesegment in December with2014, an immensely challeng-ing year for the auto indus-try, M&M Chief Executive(Automotive Division and In-ternational Operations) Pra-vin Shah said.
General Motors India re-ported a 36.56 per cent de-cline in sales at 3,619 units inDecember. Demand contin-ues to remain suppressed onaccount of high interest ratesand weak economic funda-mentals. The withdrawal ofexcise duty benefits is also abig jolt for the automobile in-dustry, General Motors In-dia Vice-President P.Balendran said.
In the two-wheeler seg-ment, market leader HeroMotoCorp reported a margin-al rise of 0.21 per cent in salesat 5.26 lakh units in Decem-ber 2014. Chennai-based TVSMotor Company said domes-tic two-wheeler sales stood at1.57 lakh units last month, up18.67 per cent.
Royal Enfield reported a47.78 per cent increase in do-mestic sales in December at28,179 units as against 19,067units in December, 2013.
Withdrawal of excise duty benefit will have negative impact
Yuthika Bhargava
Maruti, Hyundai post stronggrowth in December MUMBAI: The Reserve Bank of
India on Thursday intro-duced changes in externalcommercial borrowings(ECB) norms under whichauthorised money changingbanks had been allowed to
create a charge on securities.At present, the choice of se-
curity to be provided to theoverseas lender or the suppli-er for securing ECB is left to
the borrower.The decision was taken
with a view to liberalising,expanding the options of se-curities and consolidatingvarious provisions related tocreation of charge over secu-
rities for ECB at one place,the RBI said in a notification.
Immediate effect
The relaxations are withimmediate effect. It has beendecided that AD Category-Ibanks may allow creation ofcharge on immovable assets,movable assets, financial se-curities and issue of corpo-rate and/or personalguarantees in favour of over-seas lender/security trustee,to secure the ECB to beraised/raised by the borrow-er, it added.
However, the new rules aresubject to certain conditions.
The underlying ECB mustbe in compliance with extantECB guidelines, there shouldbe a security clause in theloan agreement, requiring theECB borrower to createcharge, and a no objectioncertificate will have to be ob-tained from an existing do-mestic lender.
Additionally, AD Catego-ry-I bank may permit cre-
ation of charge on immovableassets, movable assets, finan-cial securities and issue ofcorporate and/or personalguarantees. PTI
RBI relaxesECB norms
MUMBAI: The Reserve Bank ofIndia on Thursday extendedthe deadline for submissionof applications for licensingof Small Finance Banks(SFBs) and Payments Banks(PBs) to February 2, and clar-ified that a minimum capitalof Rs.100 crore is must for
setting up niche bankingentities.
Keeping in view the diffi-culties expressed by variousparties, it has been decided toextend the last date of receiptof applications to February2, the RBI said.
The earlier deadline wasJanuary 16.
The RBI had issued guide-lines for licensing for SFBsand PBs in November. Re-sponding to queries from in-dividuals and organisationsrelating to SBFs, the RBI saidpromoter (individual) of largebusiness or industrial housecannot act as promoter him-self to form a small bank.
It also said there is no suchstipulation regarding the ide-al number of branches a SBFshall have to be eligible forthe licence.
The RBI also clarified theproposed SBFs would be re-quired to use Small FinanceBank in its name and theminimum paid-up capital ofRs.100 crore should be read-
ily available at the time of ob-taining banking licence.
Also, after setting up of thebank, if the lender proposesto go for an IPO, prior approv-al of the RBI is necessary.
While answering questionson Payment Banks, the RBIsaid there is no cap envi-saged on the number of li-cences proposed to beissued.
PBs are allowed to offerlocker and vault facilities.
It further said the balanceat the close of business on anyday should not exceedRs.100,000 per individualcustomer in a Payment Bank.
On payment of utility (likepower and telephone) bills,the RBI said this was not al-lowed for Payment Banks.
The Reserve Bank had re-ceived 176 and 144 queriesfrom individuals/organisa-tions relating to Small Fi-nance Banks and PaymentBanks. PTI
More time toapply for niche
bank licence
MUMBAI: The ReserveBank of India, onThursday, cautionedinvestors against multi-level marketing firmsthat promised highreturns and run onhefty membersubscription fees,warning such offerscould result in directfinancial losses.
The central bank alsosaid accepting moneyunder such structureswas a cognizableoffence under the Prize
Chits and MoneyCirculation Schemes(Banning) Act of 1978. Reuters
Beware of
MLM firms,
investors told
tice is followed all over theworld, said Shailesh Hari-bhakti, Chairman, DHConsultants.
Combining the positionsof Chairman and ManagingDirector with one person iscontradictory to the effectivefunctioning of the organisa-tion as the Chairman is thecustodian of governance,while the MD/CEO is the cus-todian of assets and efficiencyof running of the organisa-tion. When the same personholds both positions, it leadsto confusion and some time
even to sacrifices. These aredifferent roles, and so thesepositions must be occupiedby different individuals, Mr.Haribhakti added.
The move to separate theposts would bring in moreprofessionalism in their func-
tioning, said D. S. Rawat, na-tional Secretary-General,Associated Chambers ofCommerce and Industry ofIndia.
It looks as though the gov-ernment wants to bring inoutside experts as chairmenin some of the banks, whichwill be a great value additionto the state-owned banks,said Mr. Rawat.
However, it is time the re-muneration of CEOs in PSUbanks is enhanced some-where near to their peers inthe private sector. It cannot
be that while we expect theCEO to give performance un-der challenging circumstanc-es taking into account thesocial obligations of thesebanks, but we do not paythem the commensurate sala-ries, he added.
MUMBAI: The governmentsdecision to bifurcate the topposition at public sectorbanks will bring in transpar-ency and accountability, sayexperts.
On Wednesday, the gov-ernment initiated manage-ment reforms in public sectorbanks by splitting the post ofChairman and Managing Di-rector in four banks and ap-pointing managing directors(MDs)/chief executive offi-cers (CEOs) in Vijaya Bank,
Indian Overseas Bank, Unit-ed Bank of India and OrientalBank of Commerce.
It is an extremely healthymove, and will improve gov-ernance. In the U.S., morethan 50 per cent of enterpris-es follow this and this prac-
Bifurcating top post in PSBs will
bring in transparency: expertsLalatendu Mishra
NEW DELHI: Wipro Enterpriseswill seek nod from its mem-bers to reduce the share cap-ital to provide an exit optionto non-promotershareholders.
The company, which wasde-merged from flagship firmWipro in 2012, has called anEGM on January 13 to reduceits share capital to Rs.476.14crore from Rs.492.32 crore.
Hence, it is proposed tosatisfy the requirement of theshareholders and to give anexit opportunity to them,the company said. PTI
WiproEnterprisesconvenes EGM
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