Tuesday, 20 February 2018

Sebi Revokes curbs on Sanco Industries

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Markets regulator Sebi has lifted the curbs imposed on Sanco Industries, which was among the suspected shell companies, after finding no prima facie evidence of misrepresentation of financials by the company. "...I do not find any prima facie evidence nor suspicion of misrepresentation of financials/ business by the company (Sanco Industries), misuse of books of accounts/ funds of the company or violation of LODR (Listing Obligations and Disclosure Requirements) Regulations," Sebi Whole Time Member Madhabi Puri Buch said in an order dated February 15.

Buch also said that she is of the considered view that the actions envisaged in Sebi's letter dated August 7, 2017 against Sanco Industries are "liable to be revoked". Sanco Industries was among the firms against whom the Securities and Exchange Board of India (Sebi) initiated action on August 7 by ordering trading restrictions, following receipt of a list of 331 'suspected shell companies' from the government. The ordered trade restrictions - allowing trade only once a month and that too for only buy transactions with a 200 per cent security deposit - were revoked in some cases a few days later following appeals filed by them with the Securities Appellate Tribunal, but Sebi was asked to continue with its probe and pass its orders expeditiously.

Greenply Industr Q3 net Profit Jumps 50.25% at Rs 36.06 cr

The company reported standalone net profit of Rs 36.06 crore for the quarter ended December 31, 2017 as compared to Rs 24.00 crore in the same period last year, registering a year-on-year growth of 50.25 per cent. Net revenue of the company rose moderately by 11.29 per cent at Rs 399.29 crore in October-December quarter of this fiscal as against Rs 358.78 crore in the corresponding period last year. During October-December quarter, operating expenses increased by 8.18 per cent to Rs 336.64 crore from Rs 311.18 crore in year ago period.

Other Income dipped by 63.54 per cent at Rs 1.01 crore versus (Dec'16 Rs 2.77 crore). Operating Profit surged by 29.28 per cent to Rs 62.65 crore as against Rs 48.46 crore in the year ago period, while Operating Profit Margin (OPM) expanded year-on-year to 16.14 per cent in December quarter. Interest declined by 22.42 per cent y-o-y to Rs 2.56 crore, while Taxation increased by 23.73 per cent at Rs 14.60 crore (Dec'16 Rs 11.80 crore).

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PNB will Need to own Responsibility for `bonafide Transactions` - Fnance Ministry

India's Punjab National Bank (PNB), which is at the centre of a probe into a $1.77 billion loan fraud scam, will need to honour the "bonafide" transactions that have occurred through the bank's platform, a finance ministry official said on Monday.

In the case, diamond billionaire Nirav Modi and others are accused of colluding with bank employees to fraudulently obtain advances for payments to overseas business suppliers, in the country's biggest ever bank scam.

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Some banks have said that PNB was liable to make good on the credit extended, although PNB maintains other lenders share some of the blame as they should have more closely examined the requests for credit. Analysts have warned, however, that PNB may be left on the hook.

Rajiv Kumar, India's financial services secretary, said the bank "will have to own responsibility of bonafide transactions."

Morgan Stanley estimated on Thursday if PNB had to assume all the liability from the fraud it would need 80 billion rupees ($1.25 billion) in additional capital, which at the stock's current valuation would mean a 14 percent dilution.

Kumar also said the ministry had written to all banks to take effective steps to avoid a repeat of a PNB-like fraud. The Reserve Bank of India will also take all the required steps in the fraud case, Kumar said.

"Our responsibility is to ensure that fire alarms are installed and are in working condition. We can't stop every fire," Kumar told Reuters.

Axis Bank raises MCLR by 10 basis Points

Private lender Axis Bank on Monday announced that it has hiked its benchmark marginal cost of funds based lending rate (MCLR) by 10 basis points for its three-month to one-year loans by 10 basis points, effective from February 17.

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With one basis point being equivalent to 0.01 percentage point, the revised one year MCLR now stands at 8.40 per cent, Axis Bank said in a stock exchange filing.

Consequently, while the bank's three-month MCLR now stands at 8.15 per cent, the six-month rate is at 8.30 per cent.
The bank had last hiked the MCLR by 5 basis points in January.

In addition to the Base Rate system followed by commercial banks, the Reserve Bank of India (RBI) introduced the MCLR from April 1, 2016, whereby rates are fixed for a one-year period and revised only at the end of each year.

The central bank introduced the MCLR as a system working in tandem with its policy rates, which commercial banks have been slow in accepting, preferring to continue with the Base Rate regime.

In yet another measure to speed up retail transmission by banks of the central bank's cuts in lending rate, the RBI said earlier this month that it will link the Base Rate with the MCLR from the next fiscal.

Since the MCLR is more sensitive to policy rate changes, the RBI has decided to harmonise the methodology of determining benchmark rates by linking the Base Rate to the MCLR with effect from April 1, 2018, the central bank said in a release here following announcement of the fiscal's final bi-monthly monetary policy review at which it kept its key lending rate unchanged at 6 per cent.

Stocks in the news: HDFC, Kaya, Fortis, Ambuja Cements, Amtek Auto, Religare

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Here are stocks that are in news today:
IndiGrid Trust

-Investment in power transmission asset of Techno Electric and Engineering Company Limited

-Completed acquisitions of 3 units from Sterlite Power Grid Ventures Limited

Tata Power

-Gets shareholders’ nod for scheme of agreement with Tata Power Renewable Energy

-Gets shareholders’ nod for scheme of agreement with Supa Windfarm, Nivade Windfarm

-Gets shareholders’ nod for scheme of agreement with Tata Power Green Energy

Fortis Healthcare clarifies

-On reports of SEBI & SFIO investigations against company & Religare Enterprises

-Got no communication, written or otherwise, from government on probe

-NSE Data: RK Damani’s Derive Investments buys 26.5 lakh shares of 

Fortis Health at Rs 144.5 per shareFortis Healthcare
-Promoters holding falls to 8.85 percent from 34.33 percent earlier

-25.58 percent promoter shares have been revoked
Other stocks and sectors that are in news today:

M&M to invest Rs 500 crore for electric vehicle and electric vehicle components in Chakan as a part of expansion efforts
Equity intelligence buys 13,350 shares (0.1 percent of share capital) of Kaya

Sun Pharma's wholly owned subsidiary buys additional shares in Ranbaxy Malaysia Sdn Bhd, post completion stake will increase to 90.74 percent

63 Moons, NSEL merger case another hearing on April 18
Religare Enterprises says raising of funds through issue of warrants for preferential issue by issuing 17.5 crore warrants at Rs 52.2 per share

Godawari Power and Ispat amalgamates with Jagdamba Power and Alloys; transferor company has 25MW captive power plant

Today's picks: From Adani Ports to IOC, hot stocks to watch on Tuesday

Nifty Current: 10,378 (fut: 10,375), Target: NA Stop-long positions at 10,455. Stop-short positions at 10,295. Big moves could go till 10,250, 10,500. 

A long 10,300p (37), short 10,200p(18) could gain 15-20 if the index tests10,300.Bank Nifty Current: 25058 (fut: 25072) Target: NAStop-long positions at 24,970. Stop-short positions at 25,200.

Big moves could go till 25,400, 24,725. Trend remains down and short-covering will hit resistance at 25,250.

Adani Ports Current price: Rs 394 Target price: Rs 387Keep a stop at Rs 400 and go short. Add to the position between Rs 389 and Rs 390. Book profits at Rs 387.Tata Steel Current price: Rs 649 Target price: Rs 660Keep a stop at Rs 643 and go long. 

Add to the position between Rs 655 and Rs 658. Book profits at Rs 660.Indian Oil Corp Current price: Rs 369 Target price: Rs 364 Keep a stop at Rs 373 and go short. Add to the position between Rs 365 and Rs 366. Book profits at Rs 364.

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Friday, 16 February 2018

PNB Fraud case: Union Bank has $300 mn Outstanding Exposure

State-run Union Bank of India on Thursday said that it has an outstanding exposure of about $300 million in the $1.8 billion fraud detected by Punjab National Bank (PNB) and the former was also confident of receiving the payment.

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PNB, the second largest public sector bank in India, had detected the $1.8 billion fraud in one of its branches in Mumbai and Union Bank of India was among other banks that were said to have offered credit-based on letters of undertakings (LoUs) issued by PNB.

"The outstanding exposure related to the incident is approximately $300 million and the bank is fully secured by LoU/LC/other documents and fully confident to receive the payment," it said in a regulatory filing late on Thursday.

An LoU is in effect a guarantee issued by one bank to branches of other banks, based on which foreign branches offer credit to buyers.

The lender said that through its foreign branches, it has been taking exposure with PNB as counter party under various LoU issued through authenticated SWIFT.

The bank has also purchased some Buyers' Credit Assets from Axis Bank through Risk Participation as a part of normal international business practice.

Thursday, 15 February 2018

Nestle India Fourth-quarter profit up 60 Percent

Nestle India Ltd, maker of Maggi instant noodles and Kit-Kat chocolates, on Wednesday posted a 59.6 percent rise in fourth-quarter net profit, boosted by higher domestic sales.

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Profit rose to 3.12 billion rupees ($48.68 million) in the quarter ended Dec. 31, from 1.95 billion rupees a year earlier, the Indian arm of Swiss food group Nestle SA said.

Domestic sales rose 10.8 percent to 24.01 billion rupees in the quarter and grew about 11.8 percent on a comparable basis, the company said.

Yes Bank lists $600 mn bond on India INX

Lender Yes Bank on Wednesday announced the listing of its debut $600 million bond issue on the India International Exchange (India INX).

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According to the company, the issue comes under its maiden $1 billion medium term note (MTN) programme on the global securities market.

"The MTN bonds issuance received an overwhelming response from international investors and saw a final order book, at a spread of 130 basis points, being oversubscribed," the bank said in a regulatory filing to the Bombay Stock Exchange.

In terms of investor type, "the split was 46 per cent to asset managers, 38 per cent to banks, 11 per cent to insurance companies and 5 per cent to private banks".

The bank said that it will use the proceeds to fund the banks's IFSC (International Financial Services Centre) Baking Unit (IBU) in Gift City.

Wednesday, 14 February 2018

HDFC Life`s Annuity Plan for early retirement Planners

HDFC Standard Life Insurance Company (HDFC Life) has come up with a single-premium annuity products for those who want to plan their retirement in advance, reported PTI. Under 'HDFC Life Pension Guaranteed Plan' one has the choice to decide on the annuity rate at the date of purchase of the policy, which can go up to as high as 13 per cent, said Srinivasan Parthasarathy, Senior Executive Vice President, Chief Actuary and Appointed Actuary, HDFC Life.

"Customers need not wait for their retirement to decide on the annuity rate. The deferred annuity option gives the early planners the choice of a guaranteed annuity rate at the time of the purchase," he said. "Those planning in advance for their retirement are rewarded by way of higher annuity rates, which could beas high as 13 per cent depending upon the deferment period," Parthasarthy added. The annuity product comes in two variants of single life basis for self and a joint life basis for self and spouse.

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Punjab National Bank says detects $1.77 Billion worth of Fraudulent Transactions

India's Punjab National Bank said on Wednesday it had detected "fraudulent and unauthorised" transactions worth about $1.77 billion at one of its branches in Mumbai.

The bank said in a statement the transactions were "for the benefit of a few select account holders with their apparent connivance" and that "based on these transactions other banks appear to have advanced money to these customers abroad."

The bank did not name the people involved but said it had reported the deals to law enforcement agencies and would decide whether it faces any liability arising out of the transactions later.

PNB shares fell as much as 5.7 percent in early trading on Wednesday.

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आरबीआई का बट्टाखाता ऋण से निपटने के लिए संशोधित दिशानिर्देश जारी

भारतीय रिजर्व बैंक (आरबीआई) ने गैर निष्पादित अस्तियों (एनपीए) या बट्टाखाता ऋण के तेजी से समाधान के लिए एक संशोधित रूपरेखा पेश की है। इसे दिवाला एवं दिवालियापन संहिता (आईबीसी), 2016 के निर्दिष्ट मानदंडों के साथ मौजूदा दिशानिर्देशों के अनुरूप बनाया गया है। आरबीआई ने सोमवार को जारी की गई एक अधिसूचना में कहा है कि नए दिशानिर्देश में बैंकों की प्रभावी परिसंपत्तियों की पहचान व सूचना के लिए एक ढांचा निर्दिष्ट किया गया है।

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आरबीआई की अधिसूचना में कहा गया, "दिवाला एवं दिवालियापन संहिता (आईबीसी)2016 के अधिनियमन के मद्देनजर मौजूदा दिशानिर्देशों को प्रभावी परिसंपत्तियों के समाधान के अनुरूप एक सहज ढांचे से बदलने का फैसला किया गया है।"

संशोधित ढांचे के हिस्से के तौर पर बैंक को तत्काल चूक के आधार पर प्रभावी ऋण खातों की शुरुआत में पहचान करनी होगी। इनकी डिफाल्ट अवधि के आधार पर प्रभावी संपत्तियों के वर्गीकरण को विशेष उल्लेख खातों (एसएमए) के रूप में करना होगा।

केंद्रीय बैंक ने कहा कि सभी ऋणदाताओं को प्रभावी परिसंपत्तियों के समाधान के लिए बोर्ड की मंजूरी वाली नीतियों को शामिल करना होगा, जिसमें समाधान के लिए समयसीमा भी शामिल है।

SAIL Invites Bids for outright sale of Alloy Steels Plant

State-run SAIL today invited bids from companies for strategic sale of its Alloy Steels Plant at Durgapur.The government had last year cleared outright sale of state-owned SAIL's three special steel units -- Salem Steel Plant, Alloy Steels Plant and Visvesvaraya Iron and Steel Plant.Bids for Alloy Steels Plant in Durgapur are to be submitted by April 11, 2018."Alloys Steels Plant (ASP) of SAIL is proposed for strategic divestment and the company has appointed SBI Capital Markets Ltd (SBICAP) as its transaction advisor to advice and manage the process," the steel maker said in a stock exchange filing.

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The bidding process is to implemented through open competitive bidding route, it said.As part of the strategic disinvestment, Alloy Steels Plant will be transferred to the strategic investor, on a going concern basis, which is by way of slump sale through business transfer agreement."The strategic investor will be appointed through a competitive bidding process, which shall be handled by the Government of India and its functionaries including, but not limited to, SAIL and Ministry of Steel," said the preliminary information memorandum for inviting bids.

The total capacity of the Alloy Steels Plant is 2.46 lakh MT per annum of liquid steel and 1.84 lakh MT per annum of saleable steel.Steel Authority of India Ltd (SAIL) has five integrated steel plants, a ferro-alloys plant and three special steel plants.

DLF`s Q3 Consolidated Profit Rises to Rs 4,111.95 cr

Real estate major DLF on Tuesday reported an exponential rise in its consolidated net profit for the third quarter of 2017-18 to Rs 4,111.95 crore.

According to the company, its consolidated net profit increased on the back of "one-time, exceptional pre-tax gain of Rs 8,569 crore due to restatement of DLF's investment in DCCDL".

COnsequently, the Q3 consolidated net profit rose to Rs 4,111.95 crore from Rs 98.88 crore reported during the corresponding period of FY17.

The company reported "a one-time exceptional gain on account of restatement of the DLF' s investment in DCCDL at fair market value..."

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"Certain other revaluation, impairments and provisions relating to valuation of certain assets, land parcels and investments have also been accounted for," the company said in a statement.

"The non-annualised EPS for the quarter was Rs 22.93 including one-time, exceptional gain. Net Bank Debt for DLF (consolidated, ex-DCCDL) stood at approx. Rs 5,500 crore."

The "DDCDL CCPS" transaction was completed in December 2017, as a result of which the promoters of the company received the consideration of Rs 8,900 crore (approx.) against the sale of shares and Rs 1,600 crore (approx.) towards buy back of "CCPS".

Subsequently, the shareholders of the company had approved a preferential allotment of "CCDs and Warrants" to the promoters for total consideration up to Rs 11,250 crore.

The promoters have infused Rs 9,000 crore in the company against allotment and the "balance amount of Rs 2,250 crore will be infused in the company over the course of 18 months".
As per the statement, the company has utilised the proceeds to primarily prepay a "substantial portion of its outstanding debt".

"The company has already repaid debt of Rs 7,100 crore (approx.) till date. DLF Limited remains confident to become net debt zero by end-FY19," the statement added.

Wall Street Advances; Investors lock on Inflation Data

Wall Street climbed on Tuesday for a third straight session, buoyed by Amazon.com and Apple, while investors focused on inflation data on Wednesday that could upset the market's fragile recovery - or clear the way for additional gains.

Amazon.com rose 2 percent while Apple added 1 percent, both helping the S&P 500 shake off a negative open to the session and climb 0.26 percent by the close.

Investors said data on US consumer prices and retail sales due out on Wednesday will be key to where stocks move in the short term. Inflation and interest-rate fears sparked a stock market rout after US jobs data was released on Feb. 2.

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Rob Haworth, a senior investment strategist at US Bank Wealth Management, said the market's recovery from a negative start earlier in the session was a good sign, but that it remained too soon to predict the market's return to stability."We think we're going to be volatile for a few more trading days at least, as the market sorts out what's really been going on," Haworth said.

Among the biggest movers was sportswear retailer Under Armour, up more than 17.36 percent on strong quarterly sales, and AmerisourceBergen, up 9.30 percent after the Wall Street Journal reported Walgreens was seeking to buy out the drug distributor.

Cleveland Fed President Loretta Mester, a voting member in the central bank's rate-setting committee this year, said the recent stock market sell-off and jump in volatility will not damage the economy's overall strong prospects.

Following a slump into correction territory last week, the S&P 500 has recovered 3.2 percent in the past three session. It remains down 7.3 percent from a record high on Jan 26 and is currently priced at levels first reached in early December.

The Dow Jones Industrial Average rose 0.16 percent to end at 24,640.45 points, while the S&P 500 gained 6.94 points to close at 2,662.94.

The Nasdaq Composite added 0.45 percent to 7,013.51.
Nine of the 11 major S&P indexes rose, led by real estate, up 0.54 percent.