QBiz: India Raises MSP of Sugar by 6.9 Percent & More
Business news of the day.
1. Lenders to Get 50.1% Stake in Jet Airways on Debt Recast
Jet Airways Ltd agreed to give lenders a majority stake in the airline company by converting part of their debt to equity as the airline battles a cash crunch.
The board, as part of a provisional resolution plan, agreed to allot 11.4 crore shares at an aggregate value of Re 1 to the lenders’ consortium led by State Bank of India, according to the airline’s stock exchange filing. Through the conversion, the lenders will end up owning 50.1 percent in the full-service carrier.
“...under the RBI Circular, lenders can convert debt into equity at Rs 1 when the book value per share of a company is negative,” the Jet statement said.
2. India Raises Minimum Selling Price of Sugar by 6.9 Percent
India, which vies with Brazil as the top sugar producer, increased the minimum selling price of the sweetener by 6.9 percent to help mills pay farmers on time.
The factory-gate selling price for millers was raised to Rs 31(0.44 cents) per kilogram from Rs 29 at present, according to a government notification on Thursday. The benchmark price is effective immediately, Food Minister Ram Vilas Paswan said at a press conference in New Delhi.
3. RBI Governor Shaktikanta Das Rules out Asset Quality Review of NBFCs
Reserve Bank of India (RBI) Governor Shaktikanta Das shrugged off liquidity concerns pertaining to non-banking financial companies (NBFCs) and ruled out an asset quality review in the immediate future, saying such a move might not be well-received by the market.
Das told a group of 60-70 foreign portfolio investors (FPIs) during a meeting in Hong Kong on Tuesday that the RBI was prepared to step in to ensure that the liquidity needs of NBFCs were duly met, said sources in the know. He said the quantum of non-performing assets (NPAs) had dipped significantly in the past one year and that the worst seemed to be over for the banking sector.
(Source: Business Standard)
4. Indigo Cancels Around 130 Flights for Friday Due to Pilot Shortage
Acute shortage of pilots along with NOTAMs at some airports forced IndiGo to cancel around 130 flights for Friday, a source said.
The cancelled flights account for almost 10 percent of the airline's operations, the source said. The Gurugram-based budget carrier operates over 1,300 flights per day with a fleet of 210 planes.
“Indigo has cancelled around 130 flights for Friday as it continues to face shortage of pilots," the source said. A query sent to IndiGo spokesperson and also to its Chief Operating Officer Wolfgang Prock-Shauer remained unanswered.
(Source: Business Standard)
5. Amazon Drops Plan for New York Headquarters Amid Political Opposition
Amazon said Thursday it will not move forward with plans to build a headquarters in New York after rising opposition from local politicians.
The company said it will not reopen the search process "at this time. We will proceed as planned in Northern Virginia and Nashville, and we will continue to hire and grow across our 17 corporate offices and tech hubs in the US and Canada."
The company said "for Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term."
(Source: Business Standard)
6. Paytm Pledges All Its Assets to Borrow Rs 1,400 Cr From ICICI Bank
Vijay Shekhar Sharma's One97 Communications Ltd, the parent of fintech startup Paytm, has pledged all its current assets and mutual fund investments to be able to borrow Rs 1,400 crore for working capital needs from ICICI Bank Ltd.
On 18 January, Paytm and ICICI Bank Ltd entered into an agreement under which One97 Communications’ entire current assets worth Rs 7,085.1 crore as on 31 March 2018 was hypothecated by the bank to boost the startup’s borrowing capacity. Until now, Paytm could borrow up to Rs 400 crore from the bank for working capital.
7. Maruti Suzuki, Mahindra See End of Road for Diesel Cars
Maruti Suzuki India Ltd and Mahindra and Mahindra Ltd are working on plans to gradually reduce dependence on diesel cars as regulations and market sentiment builds up against the use of the fossil fuel in India — home to some of the world’s most polluted cities.
Maruti Suzuki, India’s largest passenger vehicle maker, is in discussions with parent Suzuki Motor Corp. on the future of diesel cars in the country which include whether the company should completely cease producing diesel vehicles, said three people aware of the development. Instead, the company wants to expand its offerings of cars that run on compressed natural gas (CNG), the people said.
Meanwhile, Mahindra, which is heavily dependent on diesel vehicles, plans to start offering petrol engine options across its entire range, except the Bolero model, said Mahindra’s managing director Pawan Goenka.
8. Morgan Stanley Arm Buys Majority Stake in Pune's KSH Infra for Rs 350 Cr
Morgan Stanley Real Estate Investing (MSREI) has picked up a majority stake in Pune-based warehouse and logistics park developer KSH Infra Ltd for around Rs 350 crore. MSREI is the private real estate investment management arm of US-based Morgan Stanley Investment Management.
KSH Infra, which operates two warehousing and industrial logistics parks, totaling around 1 million square feet, in Pune, had been looking to raise funds to expand its warehousing business.
9. India, US Fail to ‘Expressly’ Discuss E-Commerce FDI, Data Localisation Issues
Around a week after the US reportedly threatened India of taking back zero tariffs on 5.6 billion dollar exports following the introduction of revised FDI guidelines in e-commerce and data localisation norms, the talks held on 14 February between two countries to iron out differences failed to have a positive outcome.
“Data localisation, e-commerce legislation and the generalised system of preferences (GSP) were not expressly discussed during talks between the United States and India,” Reuters quoted US Ambassador Kenneth Juster as saying on Thursday.
The US on Tuesday had also voiced its grievance over the contentious issues of e-commerce FDI rules and data localisation asking India to “consult all key stakeholders before making any such move,” PTI reported.
(Source: Financial Express)
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