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QBiz: NiMo’s Letter to PNB; Banks Lose Over $11 Bn in Market Cap

Here are the top business stories of the day.

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1. PNB Shut All Recovery Options For Me By Going Public: Nirav Modi

Nirav Modi, the kingpin behind the largest banking scam in the country's history, has virtually wrung his arms in the air saying Punjab National Bank (PNB)'s overzealousness has shut the doors on his ability to clear the dues, which he claimed is much lower than the bank has gone public with.

In a letter to the PNB management, a copy of which PTI has seen, Modi pegged the amount his companies owes to the bank under Rs 5,000 crore.

“The erroneously cited liability resulted in a media frenzy which led to immediate search and seizure of operations, and which in turn resulted in Firestar International and Firestar Diamond International effectively ceasing to be going-concerns. This thereby jeopardised our ability to discharge the dues of the group to the banks,” Modi wrote in the letter.

Read full story on The Quint.

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2. Since PNB Fraud, Indian Banks Erased Nearly $11 Billion in Market Cap

Listed Indian banks have lost nearly $11 billion (Rs69,750 crore) in market capitalisation after the $1.8 billion fraud at Punjab National Bank (PNB) came to light. PSU banks continued to bleed on Monday, after more lenders reported exposure to the scam.

Analysts believe the fraud will lead higher provisioning and may further impact the profitability of banks, which are already struggling under mounting non-performing assets (NPAs).

PNB shares have fallen 28 percent since the scam was reported, eroding nearly Rs 10,976 crore of its market cap. State Bank of India lost around Rs 18,000 crore in market value while Bank of Baroda erased Rs 5,634 crore.

(Source: Livemint)

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3. Gitanjali Faces Top Level Exodus in Wake of PNB Fraud

The PNB scam has triggered a top level exodus at Gitanjali Gems, with board member S Krishnan saying that there was no one to even organise a board meeting to clarify the issues surrounding the purported fraud.

While compliance officer Pankhuri Warange said there is a "sense of fear and uncertainty" among the employees in the company and there is an "absolute cluelessness" from the senior management, forcing her to quit.

In the regulatory filings, Warange also mentioned that the board meeting and quarterly results disclosure, which was scheduled on 14 February, had to be postponed as there was "no guideline" from the senior management.

(Source: PTI)

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4. CBI, ED File Cases Against Kothari in Rs 3,695 Crore Rotomac ‘Fraud’

Rotomac pens owner Vikram Kothari faced heat of central agencies after the CBI as well as the ED registered separate cases against him and his company for allegedly swindling of Rs 3,695 crore from seven banks from 2008, reported PTI.

This came a day after he categorically denied reports that he had "fled the country” over an alleged default on repayment of loans borrowed from seven public sector banks.

The CBI registered a case, after receiving a complaint from Bank of Baroda, against Kanpur-based Rotomac Global Pvt Limited, its director Vikram Kothari, his wife Sadhana Kothari, son Rahul Kothari and unidentified bank officials.

Read full story on The Quint.

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5. Nearly 87,000 Jobs Lost in Manufacturing

Creating non-farm jobs remains a huge problem, with the government's latest quarterly survey on employment in eight key sectors revealing that there's been a net addition of just 64,000 jobs across these sectors between April and June last year. Even more worryingly, the manufacturing sector lost 87,000 jobs over this period, indicating that Make in India remains a distant dream.

The labour bureau's quarterly survey shows that the education and health sectors between them added 1.3 lakh jobs in April-June 2017, while the other six sectors – manufacturing, construction, trade, transport, accommodation & restaurants, and the IT/BPO industry – put together saw a net loss of 66,000 jobs.

(Source: Times of India)

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6. Tata Steel, JSW-Piramal Joint Venture Bid For Bhushan Steel

Debt-laden Bhushan Steel Ltd said Tata Steel, JSW Living Pvt Ltd and a consortium of the company's own employees have submitted bids to take over its assets.

The company in a filing to BSE said that as part of the resolution process, "the resolution professional (RP) has received resolution plans from Tata Steel, JSW Living Private Ltd and Employees of Bhushan Steel Ltd".

JSW Living Pvt Ltd is a joint venture between JSW and Piramal Enterprises.

(Source: PTI)

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7. Maharashtra Govt Inks Rs 35,000 Crore Pact With a Pilot to Build Aircraft

The dream of a commercial pilot to set up an aircraft manufacturing company is set to take wings with the Maharashtra government on 19 February, Monday signing a Rs 35,000 crore pact with him to build aircraft.

Maharashtra Chief Minister Devendra Fadnavis was present when the MoU, which envisages Rs 35,000 investment in the project, was signed at the "Magnetic Maharashtra" global investors summit in suburban Bandra.

The MoU, between Amol Yadav and MIDC, will lead to generation of around 10,000 jobs in the project, which will be spread over 157 acre land in Palghar district.

Last year, Fadnavis had assured all help to Yadav, 42, who hails from Satara district, to start manufacturing facility for indigenous 6-seater and 19-seater aircraft.

(Source: PTI)

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8. India's High-Flying Graphite Electrode Firms Face Curbs

Indian manufacturers of graphite electrodes used in electric arc furnaces are booming on the back of China’s pollution crackdown, but soaring prices have set the companies on a collision course with government and steelmakers.

In an unusual intervention, India’s steel ministry is pushing for electrode makers to cut prices for smaller steelmakers after a 500 percent surge in domestic prices, sources told Reuters.

The government has also signalled it may introduce an export tax, aiming to boost domestic supply.

(Source: Reuters)

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9. IndiGo Moves SC Against HC Order Asking it to Move From T1 to T2

No-frill carrier IndiGo has moved the Supreme Court challenging a Delhi High Court order that it cannot claim monopoly over Terminal-1 (T-1) of the IGI Airport in Delhi, which cannot be given exclusively to it.

The airline's appeal against the 13 February order of the division bench of the High Court has been filed and is likely to be taken up for hearing on 23 February.

A larger bench of the High Court had upheld the decision of the single judge order observing that the decision of Delhi International Airport Ltd's (DIAL) to partially shift IndiGo operations from T-1 to T-2 cannot be said to be unreasonable only because it may operate harshly against that airline.

(Source: PTI)

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