Shares of telecom service providers will be in focus after the Cellular Operators Association of India, which represents operators who employ the global system for mobile communications, or GSM, technology released the monthly subscriber data for January 2013 on Friday, 22 February 2013. Bharti Airtel added about 2.29 million subscribers in January 2013 and Idea Cellular got 2.45 million new customers in January 2013. Videocon Industries' telecom venture lost almost 1.4 million users in January 2013.
FMCG and agri-sector stocks will be in focus after the Centre after trading hours on Friday, 22 February 2013, said that the total rabi sown area currently stands at 629 lakh hectares (LH), higher than 627.5 lakh hectare sown at this time last year and also higher than 619.9 lakh hectare sown on average at this time in the last five years. While wheat has been sown in approximately the same area as last year, there has been improvement in area under coarse cereals, pulses and oilseeds, the Ministry of Agriculture said in a statement. FMCG firms derive substantial revenue from rural India.
Nestle India turns ex-dividend today, 25 February 2013, for interim dividend of Rs 12.50 per share for the year ended 31 December 2012.
Infosys and the Income Tax Department (ITD) of India on Saturday, 23 February 2013, launched a central processing center for efficient administration and processing of Tax Deducted at Source (TDS). The TDS facility will process more than 400 million tax deduction submissions filed by nearly 1 million entities annually.
Infosys said it has been processing tax returns filed online by Indian citizens since 2008. Till date, the company has successfully processed more than 30 million tax filings and related refunds. In 2011, ITD selected Infosys as its managed services provider to facilitate central processing of TDS filings by business entities. As part of this new agreement, Infosys provides comprehensive services to the department including technology infrastructure, maintenance, and upgrade of applications for the Tax Deduction Reconciliation, Analysis, and Correction Enabling System, better known as TRACES.
State Bank of India (SBI) before trading hours today, 25 February 2013, said that the Executive Committee of Central Board (ECCB) of the bank at its meeting held on Saturday, 23 February 2013, has approved preferential allotment of equity shares to the Government of India (GoI) to the tune of up to Rs 3004 crore to enable the bank to support national and international banking operations undertaken through its Subsidiaries and Associates. The preferential issue has been priced at Rs 2,312.78 per share.
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In its final guideline on licensing of new banks in the private sector, the Reserve Bank of India (RBI) after trading hours on Friday, 22 February 2013, said entities/groups in the private sector, entities in public sector and non-banking financial companies (NBFCs) will be eligible to set up a bank in India through a wholly-owned Non-Operative Financial Holding Company (NOFHC). The entities/groups should have a past record of sound credentials and integrity, be financially sound with a successful track record of 10 years, the RBI said. For this purpose, RBI may seek feedback from other regulators and enforcement and investigative agencies, the central bank said. Existing NBFCs, if considered eligible, may be permitted to promote a new bank or convert themselves into banks.
The NOFHC shall be wholly owned by the promoter/promoter group, the RBI said. The NOFHC shall hold the bank as well as all the other financial services entities of the group, the central bank said. The initial minimum paid-up voting equity capital for a bank shall be Rs 500 crore. The NOFHC shall initially hold a minimum of 40% of the paid-up voting equity capital of the bank which shall be locked in for a period of five years and which shall be brought down to 15% within 12 years, the RBI said. The bank shall get its shares listed on the stock exchanges within three years of the commencement of business by the bank, the central bank said. The NOFHC and the bank shall not have any exposure to the promoter group. The bank shall not invest in the equity/debt capital instruments of any financial entities held by the NOFHC, the RBI said.
The bank will be governed by the provisions of the relevant Acts, relevant Statutes and the Directives, Prudential regulations and other Guidelines/Instructions issued by RBI and other regulators. The NOFHC shall be registered as a non-banking finance company (NBFC) with the RBI and will be governed by a separate set of directions issued by RBI.
The aggregate non-resident shareholding in the new bank shall not exceed 49% for the first 5 years after which it will be as per the extant policy, the RBI said. At least 50% of the directors of the NOFHC should be independent directors. The corporate structure should not impede effective supervision of the bank and the NOFHC on a consolidated basis by RBI.
The prudential norms will be applied to NOFHC both on stand-alone as well as on a consolidated basis and the norms would be on similar lines as that of the bank, the RBI said. The bank's business plan should be realistic and viable and should address how the bank proposes to achieve financial inclusion, the RBI said. The board of director of the bank should have a majority of independent directors. The bank shall open at least 25% of its branches in unbanked rural centres (population upto 9,999 as per the latest census). The bank shall comply with the priority sector lending targets and sub-targets as applicable to the existing domestic banks.
Banks promoted by groups having 40% or more assets/income from non-financial business will require RBI's prior approval for raising paid-up voting equity capital beyond Rs 1000 crore for every block of Rs 500 crore, RBI said. Any non-compliance of terms and conditions will attract penal measures including cancellation of licence of the bank, the RBI said.
Cox & Kings said that Credit Analysis & Research (CARE), the rating agency, has reaffirmed the short term rating 'CARE A1+' (A One Plus) of Commercial Paper (CP) of the company. Instruments with this rating indicate very strong degree of safety regarding timely payment of financial obligations and carry lowest credit risk. CARE has removed the "Credit Watch" from the long term rating of the company and has revised the long term rating of the company to 'CARE AA- (Double A Minus)' from the existing rating 'CARE AA (Double A). Instruments with this rating indicate high safety for timely servicing of debt obligations and carry very low credit risk. The rating agency has reaffirmed 'CARE A1+' (A One Plus) to short term bank facilities of the company and has revised the long term bank facilities to 'CARE AA-' (Double A Minus) from the existing rating 'CARE AA' (Double A).
Wagon manufacturing company Titagarh Wagons (TWL) and FreightCar America Inc. (FCA), have agreed to wind up and dissolve their Indian joint venture company.
The joint venture company, Titagarh FreightCar, was incorporated in India pursuant to a 2008 joint-venture agreement between the parties with the objective of manufacturing and selling aluminium coal-carrying rail wagons in India.
Soon after its incorporation, the joint venture company had begun the process of obtaining approval from the Indian Railways-Research Designs and Standards Organisation (RDSO) for aluminium wagon designs adapted for use on the Indian rail system, TWL said in stock exchange filing.
However, they said that over time it became clear that approval from the RDSO would not be obtained in an acceptable time-frame. The joint venture company formally notified the RDSO in June 2012 that it would not further pursue its request for design approval, the statement said.
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