QBiz: Sensex Records Worst Drop; TRAI Rigid on 5G Spectrum Pricing

1. Sensex Tanks as Budget Proposals Affect Sentiment

Indian stocks reported their biggest one-day decline in nine months on Monday, 8 July, as proposals to tax share buybacks, raise surcharge on non-corporate entities and increase public float in listed companies disappointed investors.

The benchmark BSE Sensex retreated 792.82 points, or 2.01percent, to 38,720.57, its biggest single-day drop since 11 October. During the day, the index fell as much as 2.3 percent, the most since 11 October 2018.

The broader 50-share Nifty index ended trading at 11,558.60, down 2.14 percent, its worst single-day fall since 11 October 2018.

(Source: Livemint)

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2. Trai Refuses to Budge on 5G Spectrum Pricing in Upcoming Auctions

The Telecom Regulatory Authority of India (Trai) on Monday reiterated its recommendation on spectrum pricing in the upcoming auctions. In response to the Digital Communications Commission (DCC), the regulator said it had considered all the relevant factors, including methodology, assumptions, and developments in the telecom sector before giving its views.

Last month, the DCC had asked Trai to reconsider its spectrum recommendations amid financial stress in the sector and to also ensure competition and greater participation of a larger set of players in the upcoming auctions.

(Source: Business Standard)

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3. Oyo’s Preparing to List in Next 2-3 Years, Eyes up to USD 18 Billion Valuation

Oyo Hotels and Homes, India’s most valuable hotel chain, is preparing for an initial share sale in the next two-three years, according to two people aware of the development, one of them directly associated with the firm.

“An IPO has been an integral part of all investor conversations over the last couple of months," the person directly associated with Oyo said on condition of anonymity. “The intent is to go public in two-three years and the company is taking several steps towards this major goal."

(Source: Livemint)

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4. Financial System's Liquidity Is in 'Huge' Surplus, Says RBI Governor

The financial system’s liquidity is in “huge” surplus and the Union Budget’s announcements related to non-banking financial companies (NBFCs) are adequate to take care of the liquidity needs of the sector, Reserve Bank of India (RBI) Governor Shaktikanta Das said on Monday, 8 July.

“Overall, the system liquidity is in huge surplus since 1 June. We have also announced a liquidity back stock for banks to implement the NBFC package announced by the FM in the Budget. We have also decided to frontload the FALLCR, which will infuse additional liquidity,” Das said in a press conference after chairing the customary post-Budget board meeting of the central bank. Finance Minister Nirmala Sitharaman addressed the central board of directors.

(Source: Business Standard)

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5. Govt to Release Final Blueprint on Big Ticket FDI Reform Soon

The government has drawn a blueprint for attracting Foreign Direct Investment (FDI) into the country, even as Finance Minister Nirmala Sitharaman announced big ticket FDI reforms in her maiden budget presented on Friday, 5 July.

ET Now has learnt that the FDI blueprint, aimed at opening sectors like Digital Media, Insurance, Information Utilities and Contract Manufacturing, is ready and will be sent to Cabinet in a few weeks time.

The government is looking at permitting 26 percent or 49 percent FDI under approval route for Uploading/Streaming of news & current affairs through digital media. “We are open to permitting FDI in digital media with some riders. Fake news is a serious issue,” said an officer in the know of the development. Currently the FDI policy allows only 49 percent FDI in TV channels, 26 percent in print media.

(Source: The Economic Times)

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6. No Clarification over FPI Surcharge Needed at Present, Says FM Sitharaman

Confusion continued on Monday, 8 July, over the government’s stand on the applicability of increased surcharge on foreign portfolio investors (FPIs), a move in the Budget that is likely to impact long-term money coming through mutual funds and pension funds.

While Finance Minister Nirmala Sitharaman said after the RBI board meeting in the capital that there was no need for any clarification on the additional tax burden, CBDT Chairman P C Mody said on the sidelines of an Assocham event in Delhi that the matter was being examined and a clarification could be issued soon.

(Source: Business Standard)

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7. Indian Railways Eyes Private Investment via PPPs for Semi-High Speed Corridor

Indian Railways eyes private investment for big projects. Railway Minister Piyush Goyal has said that several modes of financing to expand the railway infrastructure across the country are being considered.

In an interaction with IE, Goyal said that viability gap funding, public-private partnership (PPP) and government expenditure are some of the financing options that Indian Railways is mulling for various upcoming projects. In a post Budget 2019 interaction, Goyal said that the Union Budget 2019 is reforms-oriented and also lays down the vision for Indian Railways.

Even though he ruled out privatisation of the national transporter, the minister spoke on the possibility of partnerships with private players. According to Goyal, some of the old projects like station development and 100 percent electrification are already being carried out with the help of the private sector.

(Source: Financial Express)

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8. More Banks Likely to Have Been Singed by Bhushan Power Fraud

More lenders to bankrupt Bhushan Power and Steel Ltd may say that the company misappropriated funds given to it after state-run Punjab National Bank first reported a ₹3,800 crore fraud, a top bank official said, requesting anonymity.

On Saturday, 6 July, Punjab National Bank (PNB) disclosed to stock exchanges that it had detected that 85% of its exposure to bankrupt steel mill had been siphoned off and that Bhushan Power had misappropriated bank funds and manipulated account books.

(Source: Livemint)

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9. Mindtree Will Continue to Operate as Separate Entity: L&T CEO

Larsen and Toubro, which recently acquired majority share in Mindtree, Monday, 8 July, said the IT firm will be run as a separate entity and operate at an arm's length from the construction major's own tech units.

There is no direct conflict between Mindtree and L&T Infotech (LTI) as "they operate in vastly different areas with a minimum client overlap", L&T CEO and Managing Director SN Subrahmanyan said, asserting that no position is sought to be disturbed at Mindtree and no changes are being contemplated right now.

(Source: PTI)

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