QBiz: GST Rate Structure Finalised; Tata to Resolve DoCoMo Spat
The Quint’s compilation of business news from dailies across India.
1. GST Rate Structure Finalised, Majority of Items in 12% and 18% Tax Slabs
India moved a step closer towards implementing the goods and services tax (GST) after the centre and the states struck a consensus on the rates and structure of the ambitious tax reform.
However, the second and final day of the fourth GST council meeting on Friday is likely to be contentious, with both sides set to debate the sharing of administrative powers under the new tax regime.
If they do manage to reach a compromise, India will have entered the last mile of GST; a tax reform that will for the first time economically unify the country into a common market by removing inter-state barriers to trade in goods and services.
2. Tata Said to Seek Modi Govt Nod to Resolve $1.2 Billion DoCoMo Spat
Tata Sons Ltd, reversing course after ousting chairman Cyrus Mistry, plans to seek Indian approval to pay $1.17 billion to estranged partner NTT DoCoMo Inc. as it looks for an amicable solution to their legal tussle, people with knowledge of the matter said.
Ratan Tata, who suddenly returned to the helm of India’s largest conglomerate last week, has restarted discussions with NTT DoCoMo on resolving the dispute outside the courts, according to the people.
Tata Sons plans to reapply to the Reserve Bank of India and finance ministry for permission to pay the arbitration award to NTT DoCoMo, the people said, asking not to be identified because the information is private.
3. Cyrus Mistry Won’t Resign as Chairman of Tata Group Companies
Cyrus Mistry has no intention of stepping down from Tata group companies on his own, said a person close to the ousted chairman of Tata Sons Ltd, indicating that a potentially long and bruising shareholder and legal battle lies ahead for the conglomerate.
Many directors of group companies have commended the performance of Mistry, who will continue with this responsibilities, said the person, who spoke on condition of anonymity.
This makes it clear that Mistry, 48, is digging in his heels for a long fight and has no intention of voluntarily giving up his positions in Tata group companies.
4. Government to Start Exiting Larsen & Toubro Stake After 13 Years
The government is likely to sell an up to 3 percent stake in Larsen and Toubro Ltd. (L&T) held by the Specified Undertaking of the Unit Trust of India (SUUTI), as early as Friday, 4 November 2016, said two bankers close to the deal.
The stake is likely to be sold via a block deal on the stock exchange, and the book for the deal is yet to open, the bankers said. Bloomberg has reported that the floor price for the deal has been set at Rs 1,415.6 per share. Currently, SUUTI holds 8.32 percent or 7.59 crore shares in L&T.
A 3 percent stake sale in L&T could fetch the the government up to Rs 4,000 crore at current prices.
5. Investors Circle Mumbai Airport, Eye GVK Stake
US buyouts firm TPG Capital is competing with Singapore sovereign fund Temasek, Canada’s CPP Investment Board and Prem Watsa’s Fairfax Financial Holdings to acquire as much as 49% of Mumbai’s airport operator from the GVK group.
A possible deal will value Mumbai International Airport Ltd (MIAL), which manages the country’s second-busiest airport, at Rs 12,500-15,000 crore, multiple sources close to the negotiations told The Economic Times.
The transaction would be similar to the arrangement that GVK has done in Bengaluru earlier this year, when it sold a 33% stake to India-born Canadian billionaire Watsa’s Fairfax for Rs 2,200 crore, they said.
(Source: The Economic Times)
6. Jindal Steel & Power Misses Interest Payments for Third Time
Jindal Steel & Power Ltd., India’s second-most indebted mill, said that it missed payment on interest due last month on some bonds, the third lapse since September.
The company did not make interest payments of Rs 154.3 million ($2.3 million) due last month on four non-convertible debentures because of short-term cash flow mismatches and the money will be paid in due course, the New Delhi-based producer said in a filing Thursday. It earlier missed interest payments on 17 bonds that were due in September and October.
7. Walmart Drops Plan for Food-Only Stores in India
Walmart India has abandoned plans to set up food only stores in the country, unsure about the viability of the business given the present restrictions, two industry people aware of the development said. According to a retail industry executive familiar with the plans of the company, based in Bentonville in Arkansas.
The headquarters does not want to move ahead with the policy in its current form. It does not want to regret later.
Retailers say operating food-only retail stores does not make business sense because of the wafer-thin margins. The government must allow the retailers to also sell a small portion of non-food items to offset high real estate costs in India and make such ventures viable.
(Source: The Economic Times)
8. Amazon Pips Flipkart on Customer Experience Quotient: Forrester Report
Amazon India has trumped home-grown rival Flipkart Ltd in delivering superior customer experience (CX) at a time when the country’s top e-tailers are focusing on retaining their existing user base with enhanced services instead of deep discounts, according Forrester’s CX Index report.
E-commerce companies, however, lag behind personal computers manufacturers, banks, credit card providers, mobile manufacturers, wireless service providers and traditional retailers in delivering superior customer experience. While customer service for online retail as a category improved from “poor” last year to “OK” this year, the segment lags behind counterparts in the US and China.
9. Reliance Jio Charges Airtel of Violating Licence Pact
Billionaire Mukesh Ambani-led Reliance Jio on Thursday slammed market leader Bharti Airtel for providing only one-way points of interconnects for completing calls rather than both-way nodes in violation of licence agreement.
Hours after Airtel said it provided 7,007 additional points of interconnections needed to complete calls made from rival Relaince Jio’s network, the latter said over 4.6 crore calls between its network and Airtel fail due to inadequate points of interconnect provided by the market leader. Reliance Jio hoped the situation will improve now that Airtel has consented to offering additional POIs.
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