QBiz: FM Jaitley to Head to US; Paytm May Raise up to $1.5 Billion

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Finance Minister Arun Jaitley. (Photo: Reuters)

1. Vijay Mallya Arrested By Scotland Yard, Granted Bail Hours Later

Liquor baron and business tycoon Vijay Mallya, who has been declared a proclaimed offender, was arrested in London by Scotland Yard on India's request for his extradition on charges of fraud.

The 61-year-old liquor baron, wanted in India for defaulting on loans, was arrested after he appeared at a central London police station. He was, however, released on bail a few hours later. Mallya appeared at Westminster Magistrates' Court in London and was seen walking out with his legal team a few hours later, after being granted bail.

Mallya, whose now-defunct Kingfisher Airlines owes more than Rs 9,000 crore to various banks, had fled India on 2 March 2016. He has repeatedly dismissed the charges against him.

Read the full story on The Quint

2. Paytm May Raise up to 1.5 Billion Dollars From SoftBank

Fintech start-up Paytm, run by One97 Communications Ltd, is in talks with Japan’s SoftBank Group Corp. to raise 1.2-1.5 billion dollars in cash in a deal that could raise Paytm’s valuation to 7-9 billion dollars, according to three people familiar with the matter.

The deal, which has been in the works for nearly three months now, will see SoftBank buying some shares from existing Paytm investor SAIF Partners and founder Vijay Shekhar Sharma as well as investing money in the company, the people mentioned above said on condition of anonymity.

Paytm, India’s second-most valuable Internet firm, may also buy Snapdeal-owned payments firm Freecharge (SoftBank is Snapdeal’s largest shareholder) in a fire sale, though the fundraising is not contingent upon the proposed buyout, the people said.

(Source: Livemint)


3. IMF Revises India's Growth Forecast to 6.8 Percent in FY17

India’s economic growth will be 6.8 percent in 2016-17 — against the official advance estimates of 7.1 percent — due to demonetisation, if the projections of the International Monetary Fund (IMF) come true. The IMF had earlier said growth in 2016-17 would be 6.6 percent.

In its World Economic Outlook, released on Tuesday, the Fund retained its January forecast of 7.2 percent growth in 2017-18, though it is lower by 0.4 percentage points than the 7.6 percent forecast in October, before the note ban.

For 2018-19, the growth rate was projected at 7.7 percent. The Fund advised the policymakers to recognise public sector banks' bad debts problems and capitalise them.


4. RBI Asks Banks to Consider Raising Provisions Against Telecom Loans

Fearing that stress in the telecom sector could come to haunt Indian lenders, the Reserve Bank of India (RBI) on Tuesday asked banks to review their exposure to the industry and consider raising provisions against these loans.

The cautionary notice came as part of a wider advisory to banks to review provisions made against standard advances in stressed sectors. These are loans which may not have turned bad yet but signs of stress may be emerging in the sector. The central bank notice is an early warning to banks who have seen gross non-performing assets double over the past 18 months to more than Rs 7 lakh crore.

(Source: BloombergQuint)


5. Theresa May’s Announcement For Early Elections Shoots up The Sterling

Sterling rose to a more than six-month high against the dollar on Tuesday after British Prime Minister Theresa May called for an early general election, boosting hopes that a victory could strengthen her party’s majority in government ahead of Brexit negotiations.

May called for an early election on 8 June, saying she needed to strengthen her hand in divorce talks with the European Union by bolstering support for her Brexit plan.

The way the market is reading it, it is viewed as something that creates a more stable political outlook for Brexit to happen, which in itself is viewed as a positive.
Alvise Marino, FX strategist at Credit Suisse, New York.

(Source: Reuters)


6. Finance Minister Arun Jaitley Set for a Five-Day Visit to USA

Finance minister Arun Jaitley is to leave on a five-day official trip to the United States of America on Wednesday. FM Arun Jaitley will be participating in the World Bank and IMF’s Spring Meetings.

During his stay in the United States, he is also scheduled to meet the President, World Bank president and the US treasury secretary. On his arrival in Washington, the Finance Minister is to be briefed by the executive director (Indian Constituency) of the World Bank and the executive director of the International Monetary Fund. According to reports by PIB, the FM will also a meeting with the editors of Washington Post and participate in a dinner, which is to be hosted by the Heritage Foundation.

Accompanying the Finance Minister will be secretary of the Department of Economic Affairs Shaktikanta Das, chief economic advisor Arvind Subramanian, and RBI governor Urjit Patel, who will lead a team of RBI officials.


7. IT Department Operations Uncover Rs 540 Crore Worth Black Money Post 31 March

With the PMGKY black money window closed on 31 March, the Income Tax department has detected over Rs 540 crore black money in the next 15 days as part of its nationwide operations to check tax evasion. Officials said the tax sleuths, in the first fortnight of the new financial year that began on 1 April , have conducted multiple search and survey operations on entry operators (agents using banking channels to launder funds), shell firms, government officials, real estate players and other sectors.

As per an official data compiled till 15 April, the department has carried out “over 250 search and survey operations where the taxman raided at least 300 shell firms and detected more than Rs 540 crore of black money.”

The action is significant as it comes after the closure of the third black money declaration window of the Pradhan Mantri Garib Kalyan Yojna (PMGKY), provided by the government to people holding stash funds to come clean and pay due taxes and penalty.

(Source: PTI)


8. TCS Misses Both Revenue And Profit Estimates in March Quarter

Tata Consultancy Services Ltd (TCS) missed analysts’ estimates for both revenue and profit in the fourth fiscal quarter, even as India’s largest software services firm’s full-year sales rose 6.2 percent to 17.58 billion dollars.

The company reported revenue of 4.45 billion dollars in the three months ended 31 March, a 1.5 percent increase from the preceding quarter and 5.8 percent from the year-ago period. Net profit totalled 992 million dollars, a 0.8 percent decline on a sequential basis and an increase of 5.8 percent from the year-ago period.

A Bloomberg survey of 30 analysts had estimated TCS to report quarterly revenue of 4.62 billion dollars and net profit of 1.03 billion dollars in the quarter.

(Source: Livemint)


9. India Eases Rules to Allow Merger of Indian Companies With Foreign Firms

India will allow local companies to merge with overseas firms, easing rules to help homegrown businesses restructure their expanding global operations, and pave the deck for more listings of securities on capital markets abroad.

Until now, only inbound mergers were permitted. With outbound mergers now permissible, there would be a lot of opportunities for Indian companies to acquire, restructure, or list on offshore exchanges as well.
Mehul Shah, Partner, Khaitan and Co 

Until the federal notification by the corporate affairs ministry on 13 April, India had permitted only inbound mergers. The merger would be in compliance with the Companies Act, 2013, and require prior approval of the Reserve Bank of India (RBI).

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