QBiz: Auto Slowdown Continues; Amazon Seeks Stay on CCI Order
Image used for representational purposes only. 
Image used for representational purposes only. (Photo: iStock)

QBiz: Auto Slowdown Continues; Amazon Seeks Stay on CCI Order

1. No Recovery in Sight for Carmakers, Sales Drop 6.2% in January

Passenger vehicle sales in India fell the most in three months in January, underscoring that a prolonged slump in demand could continue as consumer sentiment remains weak in a slowing economy while automakers adjust production ahead of a transition to new emission norms.

Sales of cars, utility vehicles and vans declined 6.2% to 262,714 units in January from a year earlier, according to data issued on Monday by the Society of Indian Automobile Manufacturers (Siam). Car sales in India are counted as factory dispatches or wholesales and not retail sales. Passenger vehicle sales had fallen 1.24% in December and 0.84% in November, which followed a 0.28% rise in October.

(Source: Mint)

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2. Amazon Seeks Interim Stay on CCI Order, Cites 'Irreparable Loss and Injury'

E-commerce giant Amazon on Monday, 10 February, filed a writ petition in the Karnataka High Court, seeking an interim stay on the Competition Commission of India’s (CCI’s) order on probing some of its business practices.

Investigation by the CCI was launched last month after the Delhi Vyapar Mahasangh (DVM), a traders’ body, filed a complaint against e-commerce players giving deep discounts on online sales of smartphones and cherry-picking sellers.

The investigation covers Amazon and rival Flipkart, which Walmart owns now.

Amazon asked the court that an interim stay be granted on the proceedings, or else a probe would cause “irreparable loss and injury” to the e-commerce player’s “reputation/goodwill”.

(Source: Business Standard)

Also Read : BSNL Launches Plan Worth Rs 2,000 With Amazon Prime Subscription

3. RBI Issues Notification on CRR Leeway for New Retail, MSME Loans

The Reserve Bank of India said on Monday, 10 February that banks need not maintain the cash reserve ratio (CRR) on new loans given between 31 January and 30 July for autos, homes and MSMEs for a period of five years. The RBI also sought to lower the loan rate for MSMEs by asking banks to link interest rates to the MSME segment to an external benchmark. It has also sought to free up capital for lenders by extending the forbearance on asset classification on their MSME portfolios till December 2020.

The RBI had said last Friday that banks need not downgrade the classification of commercial real estate assets where the project has been delayed for reasons beyond the promoter’s control for another year. “An amount equivalent to the incremental credit outstanding from the fortnight beginning 31 January 2020 and up to the fortnight ending 31 July 2020 will be eligible for deduction from net demand and time liabilities (NDTL) for the purpose of computing the CRR for a period of five years from the date of origination of the loan or the tenure of the loan, whichever is earlier, ” the RBI said in a release.

(Source: Financial Express)

4. India Inc’s Retail Debt-Raise Dips in April-Dec

The amount of debt raised by India Inc via public issuances saw a sharp 59 per cent decline in the first nine months of the current financial year to ₹11,746 crore against ₹28,565 crore in the year- ago period.

This comes in the backdrop of credit events relating to IL&FS, Dewan Housing Finance Corporation Ltd and Reliance Home Finance Ltd spooking retail investors.

“In recent quarters, we saw the book size of majority of NBFCs stagnate (if not fall). Thus, NBFCs have restricted their public issuances to a large extent. Additionally, the appetite for NBFC papers has been low on account of recent credit events,” said Marzban Irani, CIO (Fixed Income), LIC Mutual Fund.

(Source: BusinessLine)

5. SC Seeks Response From RBI, Banks on Disclosure of Reports

The Supreme Court on Monday, 10 February sought response from the RBI and banks as to why it should not recall its earlier order that allowed the banking regulator not to disclose inspection, risk assessment, and annual financial inspection reports of the banks including SBI.

A bench led by Justice SA Nazeer issued notice to the RBI, SBI, HDFC Bank, ICICI Bank and others on a plea seeking recall of the Supreme Court’s 18 December 2019 order that had asked the RBI not to make public any inspection reports, risk assessment reports and financial inspection reports of banks until further orders.

The direction against disclosure had come on an application filed by banks, which said such information cannot be shared without first giving them an opportunity to oppose it. The order had, in effect, stayed the apex court’s 26 April 2019 order that had asked the central bank to reveal information sought under the Right to Information (RTI) Act pertaining to banks’ annual inspection reports.

(Source: Financial Express)

Also Read : RBI Keeps Repo Rate Unchanged at 5.15%, Pegs GDP Growth at 6%

6. Wall Street Steady as Investors Weigh Coronavirus Risks; Apple Slips, Tesla Jumps

US stocks ticked higher on Monday, 10 February as people returned to work in China after an extended new year holiday triggered by the coronavirus outbreak but sentiment remained fragile.

Electric carmaker Tesla Inc jumped 6.3% as its Shanghai factory returned to service.

On the other hand, Apple Inc slipped 0.6%, the biggest drag on the three main indexes, as analysts predicted China's smartphone sales may plunge by as much as 50% in the first quarter due to store closures and production suspensions following the outbreak.

"Investors are quiet worried about the overly negative impact of the coronavirus on the global economy," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

(Source: Mint)

7. Gujarat Pharma Units Face API Shortage as Imports From China Slow Down

Gujarat-based pharmaceutical units have a reason to worry over coronavirus threat in China as supply of important active pharmaceutical ingredients (APIs) has been affected from the neighbouring country.

Pharmaceutical units in the state are already facing inflated prices as the industry is heavily dependent on imports from China. “Supply chain of APIs has become slower as some of the importers of APIs have started holding the stock of important raw materials for the manufacturing of drugs.

Hence, uncertainty is prevailing in the segment. We are hopeful that normalcy would return to China and the supply of APIs would become smooth.

(Source: Financial Express)

Also Read : Budget Session: Need for Financial Sector Reforms, Says Oppn

8. Industry Urges FM Nirmala Sitharaman to Change Tax Settlement Scheme

Industry on Monday, 10 February, asked Finance Minister Nirmala Sitharaman to tweak the Bill on settling direct tax disputes by reducing the amount of tax under the scheme on the lines of a similar one for indirect taxes announced in the previous Budget.

Sitharaman on Monday met industry representatives on the scheme that provides opportunity to taxpayers to pay outstanding taxes and get waiver of interest and penalty.

Sources in the Federation of Indian Chambers of Commerce and Industry (Ficci) said the main lacuna of the scheme was that 100 per cent of the disputed tax had to be paid.

(Source: Business Standard)

9. Food Delivery Business Out of the Way, Uber Turns Focus to Car Rentals, Shuttles

Ride hailing firm Uber is planning to offer self-driving car rentals and shuttle bus services in India to trump key rival Ola, three people aware of its plans said.

The move is part of the San Francisco-based company’s plans to expand its core mobility business in India with new products and partnerships, after exiting the food delivery business. The company has already formed a team for the foray into self-drive rentals and shuttle buses, the people cited above said on condition of anonymity.

Uber India has formed several partnerships and taken strategic initiatives with mobility firms including Drivezy, Zoomcar, Bounce and Revv to bring new vehicles on its platform, according to one of the three people.

(Source: Mint)

Also Read : Uber to Own 9.9% of Zomato After Selling Food Delivery Business

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