1. Amazon Becomes 2nd US Company to Hit $1 Trillion Market Value Milestone
Amazon.com Inc on Tuesday, 4 September, became the second US company to reach $1 trillion in stock market value, just weeks after Apple Inc hit the same milestone on 2 August. Shares in the world’s largest online retailer last traded up 1.4 percent at $2,041.68. Its shares hit the $2050.2677 level to give its stock a value of $1 trillion.
Amazon crossed the $2,000 threshold for the first time on 30 August after doubling its price in just 10 months. Amazon shares first hit $1,000 on 27 October 2017. It first reached $100 on 23 October 2009.
(Source: Financial Express)
2. Rupee’s Slide Gives Indian Students Abroad a Harsh Lesson in Home Economics
The rupee’s slide spells bad news for scores of Indian students in the US and other dollar-driven European countries.
With the rupee breaching the 71 mark against the dollar, there is increasing concern not only among the students, but also their parents back home.
“We have been spending more and are worried as there are no clear signs of relief on the rupee-dollar exchange front,” a student who is pursuing post-graduation at the University of Dayton, Ohio, and did not wish to be named, told BusinessLine over the phone.
Over the past six months, the steep fall in the value of the rupee has resulted in a 15-20 per cent increase in the cost of living and tuition fees in the US, he added.
Currency concerns have been around for a while now. “The dollar rate has been impacting students in the form of higher tuition fees as well as living expenses, going by the feedback we received from students and parents,” said Sridhar Kottha, a senior executive with Mumbai-based Imperial Overseas Educational Consultants.
(Source: The Hindu Business Line)
3. Why SEBI’s New KYC Norms Have Spooked Some Foreign Investors
A SEBI circular issued in April 2018 laid down new know-your-customer norms for foreign portfolio investments in India. These have impacted non-resident Indians, foreign portfolio investors, and India-based investment managers and BloombergQuint reported that some foreign funds have started winding up or reworking their structures to meet these new norms. One investor body estimates that “about $75 billion worth of investments will need to be unwound in a short period”. Market regulator SEBI has termed that as “preposterous”.
BQ explains what’s going on and which numbers to believe...
What Does The SEBI Circular Say?
On 10 April, Securities and Exchange Board of India issued a circular on enhancing KYC norms for Foreign Portfolio Investors. As per these norms Resident Indians, Non Resident Indians, Persons of Indian Origin, Overseas Citizens of India cannot be beneficial owner of a fund investing in India.
(Source: BloombergQuint)
4. TCS Share Price Jumps Above Buyback Price; Stock Surges 2.5% to Beyond Rs 2,100
Shares of India’s largest IT behemoth TCS (Tata Consultancy Services) surged by as much as 2.5% on Tuesday, 4 September, and closed above its buyback price of Rs 2,100. The firm has announced a mega share buyback program worth Rs 16,000 crore, to repurchase as many as 7.61 crore equity shares for up to Rs 2,100.
The record date for the said buyback was fixed as 18 August 2018. TCS shares closed at Rs 2,100 on NSE, up by more than 2.3%. Interestingly, the rally in the shares of IT bellwether has TCS to reclaim the Rs 8 lakh crore market capitalisation.
At such a whopping amount, TCS is only the second Indian firm after Mukesh Ambani-led Reliance Industries to achieve the feat. Of the 50 brokers tracking the TCS stock on Bloomberg, as many as 22 recommend a “buy” rating, eight “sell” the stock 20 a “hold” rating. Notably, TCS shares have returned more than 55% in the year so far.
A weakening rupee has helped to lift the export-oriented IT and pharma stocks in India.
(Source: Financial Express)
5. SEBI Panel May Suggest Easing Ownership Rules For Foreign Funds
Amid concerns over tighter foreign fund ownership and know-your-customer rules, a panel set up by market regulator SEBI may suggest easing the norms, according to three people with direct knowledge of the matter. These new rules have sparked fears of substantial fund restructuring or shut downs which may consequently lead to large outflows from the Indian equity markets.
The committee, set up by the Securities and Exchange Board of India on 21 August, in a draft report circulated among members last week, suggested addressing some of the concerns of asset managers, said the first of the three people quoted above requesting anonymity. The panel, headed by HR Khan, former deputy governor of the Reserve Bank of India, is scheduled to meet tomorrow and has invited representation from Asset Managers Roundtable in India, the person said.
The lobby group, in a press conference on Monday, had sought changes citing fears of foreign fund outflows. Their concerns stem from SEBI’s 10 April circular that bars non-resident Indians, persons of Indian origin and overseas citizens of India from being a beneficial owner – an investor holding above a particular threshold.
(Source: BloombergQuint)
6. Amazon’s Plan to Reach 500 Million Indians: Speak Their Language
Only 10 percent of India’s 1.3 billion people know English. Yet most of the country’s e-commerce services have been offered only in English, closing off online shopping to the vast majority of people.
Now Amazon is aiming to break through that language barrier. The e-commerce giant Tuesday, 4 September, offered a hearty “namaste” to this country’s half a billion Hindi speakers by making its local website and apps available in India’s most popular language. Users of the India site or app will be able to choose Hindi as their preferred language, much as American users can choose Spanish.
Amazon’s expansion into Hindi — its first foray into an Indian language, even as other companies have tried that strategy and pulled back — is vital to the company’s ambition of making India its next big market.
Amazon is already the No 2 player in India’s $33 billion e-commerce market and says it has about 150 million registered users here. But as it seeks to reach the country’s farthest regions and appeal to less-educated customers in the world’s fastest-growing pool of internet users, it has found that English is not enough.
(Source: Livemint)
7. Qatar Airways May Opt for Indian Partner, Buy Stake in Indigo for Ownership
Qatar Airways is reviewing plans for its own domestic Indian airline due to "confusing" foreign ownership rules and could opt to work with a partner in India or take a stake in IndiGo instead, its chief executive said on Tuesday, 4 September.
The state-owned Gulf carrier has long coveted the Indian aviation market, which is the fastest growing in the world, and in 2017 said it would set up a domestic airline, a year after India eased foreign investment rules for the sector.
"We are really very interested to launch an airline in India, but the regulation is a little bit confusing to us," Qatar Airways CEO Akbar al-Baker told reporters in New Delhi.
India now allows 100 percent ownership of India-based airlines, up from 49 percent, but only with government approval. Meanwhile, foreign airlines continue to be limited to 49 percent ownership.
(Source: Business Standard)
8. Three Long-Time Citigroup Executives Step Down
Three long-time Citigroup Inc. executives, including chief financial officer John Gerspach, are stepping down from their positions as the bank realigns its top management.
Gerspach, 65, who’s been the bank’s finance chief for nine years, will retire 1 March, while North America head Bill Mills and Jim Cowles, 63, who runs the bank’s Europe, Middle East and Africa business, plan to leave at year-end, chief executive officer Mike Corbat said Tuesday in a memo to staff.
Gerspach will be succeeded as CFO by Mark Mason, a 17-year veteran of the bank, Corbat said.
(Source: Livemint)
9. Indian Airlines Losses May Hit $1.9 Bn This Year: CAPA
Indian airlines are expected to post combined losses of up to $1.9 billion this financial year led by full-service carriers like Air India and Jet Airways driven by rising costs and low air fares, aviation consulting firm CAPA India said.
The loss forecast for the 12 months ending 31 March is up from an estimated $430 million to $460 million sector-wide loss in January largely due to the depreciation of the rupee and a rise in oil prices, CAPA said in a report released on Monday evening.
Ticket prices have not risen to compensate for higher costs, and CAPA said with the exception of Interglobe Aviation Ltd's IndiGo, none of the airlines have strong enough balance sheets to comfortably withstand higher costs and lower yields.
“Most carriers are ill-equipped to withstand cyclical downturns,” CAPA said in the report. “Airlines have completely lost pricing power as a result of the rapid influx of capacity.”
(Source: The Hindu Business Line)
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