FINANCIAL
NEWS
| The
'SWADESHI' offer
* RBI to encourage corporates to switch from ECBs
to domestic rupee funds to improve external
debt profile and to encourage credit pick-up
* Corporate to benefit from differential in interest
rates in India and abroad
* Domestic financing will reduce forex risk
* Part of the receipts of SBI Resurgent India
Bonds may also be used for rupee financing of
infrastructure projects on attractive terms. |
|
Grindlays
launches new loan scheme
New Delhi: ANZ Grindlays Bank has introduced
a new loan scheme meant specifically for doctors, architects and chartered
accountants.The bank will offer amounts ranging from Rs 50,000 to Rs 5
lakhs without security for any period upto 5 years.The loans can be availed
to finance anything from computer systems to marriages to club memberships.The
professionals would have to submit their income tax returns for loan entitlement
purposes and an up-front fee will be charged on a slab basis depending
on the loan amount.The loan can be repaid in equal monthly instalment. |
|
|
|
|
Share buyback may be capped at 25%
of captial
There's good news and bad news for buyback. While
companies will be permitted to float public issues to fund buyback, unlimited
buyback will not be permitted. The limit for buyback is likely to be set
at 25 per cent of the capital and resrves of the company. At the same,
shares bought back will have to be compulsorily destroyed in order to avoid
duplicate share scams like the Reliance Consultancy Service case.
Owing one's own
* Limit for buyback may be set at 25% of
the capital & reserves of the
company.
* Shares bought back will have to be compulsorily
destroyed
* The debt-equity ratio after the buyback
will have to be maintained at 2:1 |
|
Debt toll in currency ward
|
CURRENCY
|
End-sept 1997 Debt Outstanding
|
|
US Dollar
|
45,422
|
|
SDRs
|
12,017
|
|
Indian Rupees
|
12,310
|
|
Japanese Yen
|
10,644
|
|
Deutsche Mark
|
5,550
|
|
Pound Ssterling
|
2,569
|
|
French Franc
|
1,454
|
|
Nertherlands Guilder
|
750
|
|
Swiss Franc
|
554
|
|
Canadian Dollar
|
583
|
|
Swedish Krona
|
394
|
|
Others
|
633
|
|
Total
|
92,880
|
|
|
|
Govt clarifies tax exemption for core
sector funding
The UNION finance Ministry has clarified that
interest, dividend or capital gains income received
during the current financial year on investments made before June 1,1998
will continue to get exemption in relation
to Advance Tax and Tax Deduction at Source as before.
It said the amended provisions of Section 10(23G)
would come into effect from April 1,1999-- for assessment year 1999-2000,
the return for which is due after April 1,1999. Any income of the nature
covered by Section 10(23G) arising up to assessment year 1998-99 would
be governed by the old provisions. |
The
Jardine fleming recommendations
Market cap
31/5/98
US$bn |
Share of Asian market cap total
ex-Japan % |
IF portfolio weighting ex-Japan % |
Weighting/Market
cap ex-Japan x |
| 142 |
4.0
9.8 |
11.0 |
1.1 |
Nuclear tests and a desappointing budget have
shaken some foreign investors's faith in the
market.However, we believe the budget has created some very attractive
stock- specific opportunites and remain Over Weight
in the market.
 
Banks allowed to rediscount bills discounted
by NBFCs
The Reserve Bank of India has allowed banks to rediscount bills discounted
by non-banking financial companies (NBFCs) arising from sale of commercial
road carriers, including light commercial vehicles(LCVs).
Banks have, however, been
asked to ensure that the rediscounting is subject to normal lending safeguards.
This measure is expected to enable NBFCs to have recourse to further finance.
|
|
Inter-corporate investment freed, but
comes strapped with riders The
Union government has decided to free inter-corporate investments, subject
only to a series of sageguards. These include linking the interest rate
at which the inter-corporate loans are to be made to the prime lending
rate, or the rate at which the corporate has raised loans, and limiting
the validity of the special resolution by which the investments are to
be made to 12 months.
|
|
Peerless to dismantle agents structure,
recast payment norms Peerless
General Finance and Investment Company Ltd(PGFIL), country's largest residuary
nonbanking finance company (RNBC), has decided to eventually dismantle
its 18-tire agents structure and recast its commission payment norms and
give priority to the field agents at the bottom.
|
|
Revision in pension amount
The Union Cabinet has agreed to bring pensions of
officials who had retired previously on par with the pension amount that
officials who are retiring now will receive.
|
Committee suggest sweeping measures to
firm up NBFCs Live and let live
prescription:
* Capital requirement floor hiked
* Time bound registration
* CRAR requirement at 15%
* Ceiling on real estate exposure
* Liquid asset ratio to be raised to 25% of deposits
* Unsecured depositors to be given first charge
* Evolve depositors redressal authority
* NBFC ads to be standardised
|
|
Personal effects redefined for duty-free
imports In a bid to plug revenue
leakages, the revenue department has resurrected the old definition of
personal effects to be imported duty free by travellers.
This has put an end to the discretionary powers
enjoyed by customs officials at airport. The existing definition was generally
vague and defined personal effects to mean, "clothings and other articles,
new or used, which a tourist may personally and reasonably require taking
into account of circumstances for his visit but excluding all merchandise
imported for commercial purpose," which gave the customs officials certain
amount of leeway in clearances.
|
|
Samman may be a mere certificate of
honour Samman will be a mere certificate
of honour with a few fringe benefits, if the proposals submitted by the
committee set up to finalise its guidelines are any indication. Further,
the scheme will be restricted to only "honest taxpayers" selected by the
department in this financial year.
|
|
PAN order not to affect real estate bank
deals The Government on Thursday
said transactions like opening bank accounts, Property and car deals, will
not be hampered on account of the order on the mandatory quoting of permanent
account number(PAN).
Farmers
with only agricultural income do not have to pay income tax and hence will
not have a PAN.
|
S&P lowers India's sovereign rating,
says outlook is stable International
credit rating agency Standard & Poor's (S*P) lowered India's sovereign
rating to BB from BB-Plus, and its long term local currency sovereign credit
rating to BBB from BBB-Plus. The out look has however been changed from
negative to stable.
|
Country
|
Sovereign Rating
|
Outlook
|
|
India
|
BB
|
Stable
|
|
Pakistan
|
CCC-
|
Negative
|
|
Russia
|
CCC-
|
Negative
|
|
Brazil
|
BB-
|
Negative
|
|
Indonesia
|
CCC+
|
Negative
|
|
Philippines
|
BB+
|
Negative
|
|
Malaysia
|
BBB+
|
Negative
|
|
Mexico
|
BB
|
Stable
|
|
Korea
|
BB+
|
Stable
|
|
New Zealand
|
AA+
|
Negative
|
|
Uruguay
|
BBB-
|
Stable
|
|
|
Demat delivery in 24 scrips made must
for 'big' investors An investor
having a delivery of more than 5,000 shares in select 24 scrips will have
to compusorily take delivery in demat format with effect from the settlement
commencing on January 4, 1999.
The
select scrips are BSES, Bajaj Auto, Colgate, Glaxo India, Grasim Inds,
Gujarat Ambuja Cement, Hindustan Lever, HPCL, Hindalco, Reliance Inds,
ITC, Tisco, Telco, ACC, Mahindra and Mahindra, NIIT, Ranbaxy, Castrol India,
Tata chemicals, Indian Hotels, MTNL, Nestle, Novartis and Tata Power.
|
Cabinet clears VRS for eight sick
PSU's
The cabinet has approved a 'separation scheme'
for eight sick public sector units, where the workers will be adequately
compensated, and the units can then be closed down and its assets sold
off.
The
eight units - which have been written off by the BIFR and the Disinvestment
commission as unviable-- now have a total of 11,000 employes on their rolls.
They are: Mining and Allied Machinery Corporation, Cycle Corporation of
India, National Instrumentation Ltd, Weighburd India, Rehabilitation Industries
Corporation, Tanneries and Footwear Corporation, Bharat Ophthalmic Glass
Ltd and National Bicycle Corporation. |
|
UTI may into arbitrage business
Government may allow it to invest in securities abroad THE
UNION government is proposing to throw open arbitrage opportunities to
Unit Trust of India (UTI) by permitting it to invest in securities abroad.
This would have the effect of shoring up UTI's bottomlines.
LINE OF SUPPORT
* UTI may be allowed to invest
$50 million abroad
* Profits booked to boost UTI's
bottomline;
losses may erode forex
reserves
* UTI to get a level playing
field with flls
* BoP pressure forces govt rethink
on okay for other MFs
* Government working on finalising
the guidelines
|
G-7 for merger of IMF, IBRD committees
THE GROUP of Seven leading industrial nations
are discussing proposals to combine ministerial committees which oversee
the activities of the IMF and the world bank, the Financial Times Said.
The proposals to merge the International Monetary
Fund's interim and development committees were part of international efforts
to reform the global financial architecture, the newspaper said. |
|
CAI Writing guidelines for disclosures
of Y2K liabilities THE INSTITUTE of Chartered
Accountants of India (ICAI) will soon issue guidelines for its members
asking them to take a hard look at the year 2000 (Y2K)compliance adopted
by their clients world wide professionals institutions such as the international
Federation of Accountants (IFA) have issued guidelines to auditors for
dealing with the Y2K issue in the coures of their audit. |
|