QBiz: Gurumurthy on RBI Lending; Oyo Hotels Appoints New CEO
RBI Board Member S Gurumurthy.
RBI Board Member S Gurumurthy.(Photo: Harsh Sahani/The Quint)

QBiz: Gurumurthy on RBI Lending; Oyo Hotels Appoints New CEO

1. RBI Should Aid Lending to Small Businesses: Gurumurthy

There is a strong case for the Reserve Bank of India (RBI) to improve banks’ lending capacity by easing regulations as small businesses, the lifeline of the country’s economy, are starved of funds, Swaminathan Gurumurthy, part-time director at the RBI, said on Thursday.

Gurumurthy’s call for the central bank to ease the capital adequacy parameter for banks and lending restrictions on certain weak banks comes at a time of heightened tension between the government and RBI over a host of issues including the liquidity-enhancing measures that New Delhi wants implemented. Gurumurthy backed the government’s stance on issues like improving liquidity for non-banking finance companies, a key source of funds for micro, small and medium enterprises (MSMEs). The RBI’s board will meet next Monday, in which an appropriate economic framework of the central bank will be discussed.

(Source: LiveMint)

2. $2 Billion Share Sale of ONGC, IOC & OIL in the Pipeline

The government is considering a plan to sell shares worth $2 billion in Oil and Natural Gas Corp (ONGC), Indian Oil Corp (IOC) and Oil India Ltd (OIL) to help meet this year’s divestment target, according to people familiar with the matter. This would be on top of the proceeds generated from a likely ₹10,000-crore share buyback by these companies.

The finance ministry is planning the mix of share sales and buybacks by state oil companies with about a fourth of the ₹80,000-crore asset-disposal target having been met thus far, said the people. The government is considering the sale of about 5 percent equity stake in ONGC, 3 percent in Indian Oil and 10 percent in Oil India, people with knowledge of the matter said, cautioning that the quantum could vary by the time the government launches offers for sale. The timing of the sale is currently unclear but it could take place in a month or so. Both will depend on investor sentiment and details of the buyback plans, the people said.

(Source: The Economic Times)

3. India has €185 Million Bank Guarantee on Offset

India may have managed to get just a ‘letter of comfort’ from France on the contract for 36 Rafale fighter jets, but it had secured a €185-million bank guarantee from Dassault as a safeguard against any violations of the offset policy, people familiar with the deal said.

A special clause in the deal, which mandated that 5 percent of the total offset value be kept as a buffer in case of non-performance, was invoked after officials insisted that the safeguard was needed to protect interests, the people told ET.

This was in line with similar provisions that are in place when it comes to direct government defence deals with the US.

(Source: The Economic Times)

4. OP Bhatt Resigns From Yes Bank’s CEO Search Panel

Former State Bank of India Chairperson Om Prakash Bhatt has stepped down from the panel set up to search for a new chief executive officer for Yes Bank Ltd.

Bhatt tendered his immediate resignation from the search and selection committee citing that there may be a potential conflict of interest, the private lender said in a stock exchange filing. The nomination and remuneration committee of the bank has accepted the resignation.

Yes Bank aims to find a successor for Rana Kapoor by the 31 January deadline given by the Reserve Bank of India. The lender’s request for an extension of term for Kapoor was rejected by the central bank. The search and selection committee has signed up headhunter Korn Ferry to help in finding a new chief.

(Source: BloombergQuint)

5. Oyo Hotels Appoints Ex-IndiGo President Aditya Ghosh as New CEO

Hospitality startup Oyo Hotels has appointed former IndiGo president Aditya Ghosh as its new chief executive officer for India and South Asia with effect from 1 December 2018. Aditya joins Oyo following an outstanding stint at IndiGo as president and wholetime director before resigning earlier in the year.

Aditya Ghosh’s appointment comes as a part of Oyo’s efforts to continue to invest in and attract world-class leadership, in the wake of its focus to drive accelerated growth in its home markets—India and China, the company said in a statement.

(Source: LiveMint)

6. Mahindra to Invest Rs 5 Billion on Electronic Vehicle Research, Drivetrain Plant

In anticipation of the growing demand for electric vehicles (EVs) in India, the Mahindra Group is looking to invest Rs 5 billion in setting up a global R&D centre for EVs in Bengaluru and a high-voltage electric drivetrain plant in Chakan over the next few months.

At the launch of its electric three-wheeler Treo in Bengaluru on Thursday, Pawan Goenka, managing director at Mahindra and Mahindra, said cumulative investments made by the firm in electric mobility would reach Rs10 billion by 2020. The firm has already invested Rs3 billion in expanding its plant in Bengaluru to produce a peak of 1,000 units of the Treo every month.

(Source: Business Standard)

7. Exports Bounce Back in October to 17.86%, Trade Deficit Widens to $17.13 Bn

Exports bounced back in October to high double-digit figures after a mild contraction in September, as engineering goods, pharmaceutical and chemical shipments picked up pace. However, this didn't prevent trade deficit from widening, as crude oil bill continued to shoot up.

Outbound trade rose by 17.86 percent in October to $26.98 billion. In September, exports had declined for the first time this financial year, albeit by a moderate 2.15 percent. Despite suggesting that this was due to global trade headwinds, the figure had raised eyebrows among policymakers since the fall had come even as the rupee depreciated against the dollar.

However, the latest rise failed to stop the widening trade deficit, which in October rose to $17.13 billion, compared to $13.98 billion in September, as the pace of import growth picked up again.

(Source: Business Standard)

8. Nvidia Shares Slide 17% as Cryptocurrency Demand Vanishes

Chip designer Nvidia Corp on Thursday forecast sales for its fiscal fourth quarter well below Wall Street expectations, pinning the blame on unsold chips piling up with distributors and retailers after the evaporation of the cryptocurrency mining boom. The Santa Clara, California-based company also posted sales that missed expectations for its third quarter. Shares plunged nearly 17 percent in late trading.

Nvidia chief executive Jensen Huang said Nvidia gaming card prices had risen with cryptocurrency frenzy and the high prices drove some buyers away. As the frenzy receded and card prices came down, Nivida expected sales volumes to grow again as buyers who were priced out came back.

(Source: LiveMint)

9. We Need More Exports, Less Imports: Gadkari

Union Minister Nitin Gadkari on Thursday said that India needs to develop an economy that would export more and import less.

He was speaking at a function organised by Vishwa Samwad Kendra here.

"We need an economy where there will be more exports and less imports. We need ethics, value-based lifestyle and modern economic order," he said.

"I have been talking to aircraft-making companies such as Airbus and Boeing for using biofuels in aviation sector. If we succeed (in persuading them to make biofuel-run aircraft), the savings on fuel will be as high as Rs 30,000 crore," he said.

The Union transport minister cited successful trial of a Dehradun to Delhi flight which used biofuel.

(Source: PTI)

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