1. India Assets to Cheer Exit Polls Predicting Second Term for Modi
India’s stocks, rupee and bonds will likely gain Monday as exit polls showed Prime Minister Narendra Modi’s party is set to retain power.
Most exit polls predicted a majority for the Bharatiya Janata Party and its allies as the nation’s six-week-long general election ended Sunday. Votes will be counted Thursday.
The forecasts come when the optimistic tone for the nation’s assets has waned as the trade standoff combined with concern about Modi’s ability to repeat his landslide 2014 win amid a resurgent opposition, farm distress and a job crisis. Investors had been concerned that an outcome that defies the market’s base case view – the BJP-led alliance winning with a slim majority -- could lead to an adverse reaction.
(Source: BloombergQuint)
2. Foreign Investors Withdrew Rs 6,399 Cr In May So Far
Overseas investors have pulled out a net amount of Rs 6,399 crore from the Indian capital markets in May so far on the back of election-related uncertainty and the US-China trade tensions.
Prior to this, foreign portfolio investors were net buyers for three consecutive months. They had infused a net Rs 16,093 crore in April, Rs 45,981 crore in March and Rs 11,182 crore in February in the domestic capital markets—both equity and debt.
However, a reversal of the trend has been witnessed in May.
As per latest depositories data, FPIs pulled out a net sum of Rs 4,786.38 crore from equities and Rs 1,612.62 crore from the debt market during 2 May to 17 May, taking the total net outflow to Rs 6,399 crore.
(Source: BloombergQuint)
3. TCS Eyes Double-Digit Growth in FY20, Says COO Subramaniam
Tata Consultancy Services Ltd (TCS), India’s largest information technology (IT) services firm, is on track for double-digit growth in the current fiscal year, the second consecutive year of strong growth, without sacrificing its industry-leading profitability, TCS chief operating officer, N Ganapathy Subramaniam said.
At the heart of TCS’ confidence is the higher growth rate with which it started the current financial year and healthy deal wins.
TCS started the current fiscal year with a 3.6 percent growth rate in constant currency terms, as against 2.8 percent in April last year. This is the highest at which TCS has started a financial year in five years since growing 15 percent in 2014-15.
(Source: Livemint)
4. ONGC, GIP, Tripura Govt Look to Buy IL&FS’s 26% Stake in OTPC
State-run Oil and Natural Gas Corp. Ltd (ONGC), Global Infrastructure Partners (GIP) and the Tripura government are seeking to buy Infrastructure Leasing & Financial Services Ltd’s (IL&FS) 26 percent stake in the Rs 3,804-crore ONGC Tripura Power Co. Ltd (OTPC), which runs the Palatana power project in Tripura.
The stakeholders have evinced interest in acquiring the stake held by the beleaguered IL&FS by leveraging the share-holder pact, which states that IL&FS should offload its share to stakeholders under distress conditions at a 20 percent discount on the Rs 10 share face value.
The stake of IL&FS is to be proportionately divided among the shareholders.
(Source: Livemint)
5. RBI Readies Credit Line Rules for NBFCs
The Reserve Bank of India (RBI) is working on a liquidity line for non-banking financial companies (NBFCs) and may ask for suggestions from participants on draft guidelines after election results are declared. One of the likely measures is the central bank opening a special borrowing window for NBFCs, similar to what banks have, according to sources.
How much an NBFC can borrow would be decided after excluding the NBFC’s real estate and construction finance exposure. NBFCs will be able to borrow, based on their retail, agriculture, and other such assets.
(Source: Business Standard)
6. DRT Asks Vikram Bakshi, Mcdonald's India to Appear Before It
McDonald's India and its estranged partner Vikram Bakshi have been directed by the Debt Recovery Tribunal (DRT) to appear before it and deposit the proceeds of the proposed settlement with respect to their joint venture firm CPRL.
Earlier this month, fast food chain McDonald's reached an out-of-court settlement with Bakshi, buying out Connaught Plaza Restaurants Pvt Ltd from the joint venture.
Allowing an application by the state-owned HUDCO on 9 May, the presiding officer of DRT II Delhi has directed Bakshi not to transfer his 3,100 attached share of Connaught Plaza Restaurant Ltd (CPRL), a Joint venture between him and McDonald's India to operate fast food chain in northern and eastern India.
(Source: Economic Times)
7. Merger Impact: BoB Looks to Rationalise 800-900 Branches
State-owned Bank of Baroda (BoB) is considering the option of rationalising 800-900 branches across the country to improve operational efficiency, following its merger with Dena Bank and Vijaya Bank.
The merger of Dena Bank and Vijaya Bank with BoB became effective from 1 April.
It does not make sense to have branches of Dena and Vijaya at the same location when both have been merged into BoB, a senior bank official said.
"There are cases where branches of three banks are at one location or one building. So these branches have to be either closed or rationalised as duplication is a drain on efficiency," the official said.
(Source: Economic Times)
8. MCA Sees Rs 2.8 Lk Cr Recovery From IBC-Led Resolution Process
Terming the current insolvency process and its outcomes as super success, Ministry of Corporate Affairs sees total recovery amount touching Rs 2.8 lakh crore through resolutions with the settlement of two key accounts, including some others – Essar Steel, where financial creditors have approved the resolution and Bhushan Steel and Power.
"The 100 cases that have been settled through resolution accounts, Rs 1.8 lakh crore have been netted which is not a small amount and the accounts sitting on margin (Bhushan Steel and Power & Essar Steel), another Rs 1 lakh crore along with some other mid-sized resolutions can come, so Rs 2.8 lakh crore out of Rs 10 lakh crore of NPA that time is not a small amount, IBC is a super success", says MCA senior officials on the insolvency processes
(Source: Economic Times)
9. India Registers Trade Deficit With 11 RCEP Members in FY19
India has registered trade deficit in 2018-19 with as many as 11 RCEP member countries – including China, South Korea and Australia – out of the grouping of 16 nations that are negotiating a mega trade pact since November 2012.
The Regional Comprehensive Economic Partnership (RCEP) bloc comprises 10 Asean group members (Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand, the Philippines, Laos and Vietnam) and their six FTA partners – India, China, Japan, South Korea, Australia and New Zealand.
According to the provisional trade data, India’s trade deficit – the difference between imports and exports – with three countries (Brunei, Japan, and Malaysia) has in fact increased marginally in 2018-19 as compared to the previous fiscal.
(Source: Financial Express)
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