QBiz: Jet Airways to Sell 6 Planes, Zee’s Global Ambitions & More

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A Jet Airways Boeing 777-300ER at San Francisco International Airport, USA. 
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1. Jet Airways to Sell Six Boeing 777 Planes to Reduce Debt

Jet Airways (India) Ltd plans to sell six Boeing 777 planes, a top company executive said, as the cash-strapped airline aims to clear most of its aircraft-related debt, which stands at about Rs 1,800 crore. “The airline has identified six Boeing 777 aircraft, which it will sell to lessors under sale and leaseback and use the proceeds to pay most of the aircraft debt,” Jet Airways chief financial officer Amit Agarwal told analysts at a post-earnings call on Tuesday.

Jet Airways had a net debt of Rs 8,052 crore at the end of the quarter that ended on 30 September 2018. It had a net debt of Rs 7,364 crore as of June-end. While 60 percent of the airline’s debt is dollar denominated, its aircraft debt stands at Rs 1,800 crore.

Jet Airways has 124 aircraft, according to its website. Of this, it owns 16 aircraft, mostly wide-body planes, while the rest are on sale and leaseback from lessors.

(Source: LiveMint)

2. Zee Plans Strategic Divestment to Fuel Global Ambitions

Media and entertainment conglomerate Zee Entertainment Enterprises Ltd has decided to divest 50 percent of Essel Group’s shareholding in the company as it looks for a global strategic partner. The move would help it maximise long-term value and transform it into a global media-tech player with content offering for audiences in more than 170 countries.

Essel Group has decided to appoint Goldman Sachs Securities (India) Ltd as investment banker and Lion Tree as an international strategic adviser to manage the Zee divestment. It expects the outcome of the strategic review to be concluded by March or April 2019.

(Source: LiveMint)

3. Essar Steel’s Resolution Faces Another Hurdle As Operational Creditors Move NCLT

ArcelorMittal may not get their hands on Essar Steel so easily.

Operational creditors of the insolvent firm have moved the National Company Law Tribunal saying that resolution plan accepted by the Committee of Creditors doesn't take their dues into consideration. In two separate petitions filed at the Ahmedabad bench of the NCLT, a total of 28 operational creditors have asked the tribunal for staying further resolution proceedings till their grievances are addressed.

The first petition, moved by 27 operational creditors, has asked the tribunal to direct the committee of creditors to ensure full payment to the them and take necessary steps to modify ArcelorMittal's resolution plan for that. Alternatively, it has asked the tribunal to direct the lenders to also consider the Ruia family's last-minute offer that promises to repay all creditors fully.

The second petition, filed by Orissa Stevedores Ltd that is owed 20.46 crore, has also made a similar demand while also asking the committee of creditors to provide a copy of ArcelorMittal’s resolution plan.

(Source: BloombergQuint)

4. Ashok Leyland's Vinod Dasari Steps Down as CEO After a 14-Year Stint

Vinod K Dasari has quit as Managing Director and Chief Executive Officer of Ashok Leyland after nearly 14 years in the company. He has decided to pursue his personal interests.

In the interim, the company’s Chairman Dheeraj Hinduja will oversee the responsibilities as Executive Chairman. He will be the first MD to quit Ashok Leyland, while all his predecessors retired. “I have been thinking about this for some time; I have decided to pursue my personal interests,” said Dasari, who joined Ashok Leyland as Chief Operating Officer 14 years ago and took over as MD 7 years back.

(Source: Business Standard)

5. ‘Be Ready for Jail’: SC Orders Attachment of Amrapali Assets

In a crackdown on Amrapali Group for “wilful disobedience” of its orders, the Supreme Court, on Tuesday, 13 November, ordered the attachment of the company’s 100-bed multi-speciality hospital, bank accounts, the building that houses its office, firms and a ‘benami’ villa in Goa.

The court also asked the Chief Financial Officer Chander Wadhwa to deposit Rs 11.69 crore with its registry within three weeks and asked a statutory auditor Anil Mittal to pay Rs 47 lakh.

It restrained the realty firm from alienating its companies through which it had transactions and ordered attachment of such firms.

(Read the full story here.)

6. No Respite for Bank of India, Amid RBI vs Govt Over PCA

One of the main issues of contention between the government and the Reserve Bank of India (RBI) is the prompt corrective action (PCA) framework for banks. Now, it pays to see how the banks that have come under PCA have performed.

Bank of India is the fifth lender among the 11 under PCA to report September quarter results, and the signs are mixed. The public sector bank reported a quarterly loss of Rs 1,156.25 crore, massive if one compares with the Bloomberg analysts’ survey, which estimated losses of Rs 456.30 crore.

The bank had to provide 71 percent more than it did a year ago, and its core income stagnated owing to the focus on conserving capital instead of lending. The stock of bad loans remained above Rs 60,000 crore and the bad loan ratio barely improved, despite the rather encouraging 10 percent growth in its domestic loan book.

(Source: LiveMint)

7. Q2 Results: Tata Steel’s Profit Jumps On Bhushan Steel Inclusion And One-Time Profit

Tata Steel Ltd’s profit for the September-ended quarter surpassed estimates owing to the inclusion of Bhushan Steel and its financials into its books.

Net profit for the quarter stood at Rs 3,604.2 crore compared with last year’s Rs 976 crore — above the Bloomberg consensus estimate of Rs 2,483 crore. The results of the quarter are not comparable on a yearly basis owing to the inclusion of Bhushan Steel’s numbers.

The company also reported an exceptional gain of Rs 163.7 crore versus a Rs 44.65 crore loss in the year-ago period. Exceptional gain worth Rs 130 crore was attributed to liabilities that needn't be written back. Gains also stem from the sale of subsidiaries in joint venture in relation to its European operations.

(Source: BloombergQuint)

8. Sebi Tightens Disclosure, Review Norms for Credit Rating Agencies

The Securities and Exchange Board of India has tightened disclosure norms and rating standards for credit rating agencies (CRAs) following the IL&FS fiasco.

The capital markets regulator has asked rating agencies to include a specific section on liquidity, highlighting parameters such as cash balances, access to unutilised credit lines and adequacy of cash flows for servicing maturing debt obligations in their ratings reports. This is to help investors understand the liquidity situation of an issuer.

“While carrying out monitoring of repayment schedules, CRAs shall analyse the deterioration in the liquidity conditions of the issuer and also take into account any asset-liability mismatch,”Sebi said in a circular on Tuesday. ET had first reported about Sebi’s plans to enhance disclosure and rating standards in its 31 October edition.

(Source: The Economic Times)

9. Liquidity Deficit Highest Since June 2016 as Banks Continue to Borrow

Indian lenders have continued to borrow in the midst of the worst liquidity crisis in the banking system in nearly 30 months to tide over the strong demand for funds during the festival season as loans also dried from non-banking finance companies.

The daily net borrowing was in the range of Rs 71,000 crore and Rs 1.4 lakh crore in the month since 8 October this year, Bloomberg data showed. The deficit has been the sharpest since between October 2015 and June 2016.

While bank borrowing rose through the Liquidity Adjustment Facility, the interbank market is yet to show strains as the overnight call money rates are still hovering around the RBI’s repo rate. The weighted average call rate was at 6.48 percent on Tuesday.

(Source: The Economic Times)

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