Companies Act amended to include penal provisions for CSR norm violations

Parliament on Tuesday cleared amendments to the companies law that will tighten norms pertaining to CSR spending for corporates, strengthen enforcement provisions and help unclog National Company Law Tribunal.
Rajya Sabha passed the Companies (Amendment) Bill, 2019 by voice vote on Tuesday and the legislation would replace the ordinance issued by the corporate affairs ministry.

"We are trying to bring in ease of doing business, bring in a robust framework through which the Companies Act can be implemented. We are also trying to rationalise and re-categorise minor offences for civil defaults," Corporate Affairs Minister Nirmala Sitharaman said in the Upper House.
She also said the bill aims to strengthen provisions that enable the Serious Fraud Investigation Office (SFIO) to ensure speedy and more effective enforcement.
The bill was passed by Lok Sabha on July 26.
Replying to the discussion on the bill, Sitharaman, who is also the Finance Minister, said the government has brought in all the provisions of the ordinance besides adding new amendments.
The ordinance is to lapse on Wednesday, she added.
About Corporate Social Responsibility (CSR) norms, the minister said companies used to comply with the requirement fully or partly and then explain and get away with it.
Now, there would be a provision wherein the unspent CSR amount would be transferred to an escrow account for three financial years. Subsequently, if the amount remain unspent then the same would be moved to funds specified in Scheduled VII of the Companies Act.
Under the Act, certain class of profitable companies are required to shell out at least two per cent of their three-year annual average net profit towards CSR activities.
"It is a very interesting step which we have taken keeping the spirit of the legislative intent of Companies Act, 2013. Actually, CSR is applicable to all those companies which have Rs 5 crore profit or Rs 1,000 crore turnover or Rs 500 crore networth.
"So CSR, does not apply to everybody but you have to fall in this category. Therefore, those companies will now have to be state as to where they have to spend the money," Sitharaman said.
Stating that the bill provides for better clarity related to CSR, she said if a company is unable to spend the earmarked amount for CSR activities within a particular financial year, it shall transfer the same to an CSR or an escrow account to be spend within the next three fiscal years.
"Any amount remaining unutilised in such CSR account shall thereafter to be transferred to any fund specified in Schedule VII," Sitharaman said, adding that "money will come to the ground, money will be available for actual spending".
The minister said that Section 135 of the Act was being amended to provide for specific penal provision in case of non-compliance of CSR provisions.
According to her, the Act is undergoing major changes with number of amendments and wondered whether the earlier Act was passed in a hurried manner. The law was passed during the UPA regime.
She said that the amended bill will de-clog the National Company Law Tribunal by shifting routine matters out of it.
To crack down on shell companies, the minister said it has been made mandatory to have physical address and register to ensure such companies exist on ground.
She said that four lakh companies have so far been de-registered as they did not file financial results for two years and did not even apply for dormant status.
The Corporate Affairs Minister expressed concern over individuals breaching the ceiling on directorship and said the bill provides for disqualification in case of violation of permissible limit.
Responding to a member's concern over small companies facing problem in appointing company secretaries, Sitharaman assured the government is considering relaxing the provisions concerned and would hold consultations with all stakeholders to work out a solution.
She also assured that there is no conflict between National Financial Reporting Authority (NFRA) and chartered accountants' apex body ICAI.
The bill empowers Registrar of Companies (RoC) to initiate action for removal of a company's name from official records if it is not carrying on any business or operation in accordance with the company law.
Among other things, the bill provides for re-categorisation of 16 minor offences as purely civil defaults and transferring of functions with regard to dealing with applications for change of financial year to central government.
It also provides for shifting of powers for conversion from public to private companies from NCLT to the central government, as well as more clarity with respect to certain powers of the NFRA.

RBI allows domestic banks to sell NPAs abroad as one-time settlement

The Reserve Bank of India (RBI) on Tuesday allowed domestic banks to directly sell their bad loans in manufacturing and infrastructure sectors to investors abroad as part of one-time settlement (OTS) exercises. The move will allow overseas investors to take direct loan exposure to Indian corporates.
The defaulters, or stressed borrowers, can sell their assets in accordance with the OTS scheme, in order to raise external commercial borrowing (ECB) from abroad to repay domestic loans, the RBI said in a statement.

At the same time, Indian corporates can raise long-term loans for working capital, ‘general corporate purposes’ and repaying domestic rupee loans, the statement said.
Apart from easing the non-performing asset (NPA) pressure on domestic banks, the RBI’s move can allow companies to raise cheap, long-term loans easily now. Part or all of that can be used to retire domestic loans.
The RBI notification said corporate borrowers can avail of ECB “for repayment of rupee loans availed domestically for capital expenditure in manufacturing and infrastructure sector and classified as SMA-2 or NPA, under any one-time settlement arrangement with lenders”. SMA is special mention account, in which SMA-2 is the loan not serviced between 60 days and 90 days.
If the loan is not serviced on the 91st day, it becomes NPA.
“Lender banks are also permitted to sell, through assignment, such loans to eligible ECB lenders, except foreign branches/overseas subsidiaries of Indian banks, provided, the resultant external commercial borrowing complies with all-in-cost, minimum average maturity period and other relevant norms of the ECB framework,” the notification said.
Experts said it diversifies the loan market for the corporate borrowers.
“This is a good solution, which would shift credit outside of the Indian banking sector, but it would also increase our forex exposures,” said Abizer Diwanji, national leader of financial services for EY. Senior bankers, speaking on condition of anonymity, told Business Standard that the move potentially opens up two possibilities. One, instead of heading for the Insolvency and Bankruptcy Code (IBC), banks and the companies can now easily get into a OTS scheme between themselves, funds for which have to be raised abroad by the defaulter, or the banks.
Bankers pointed out that the RBI was distinctly uncomfortable with this route and didn’t allow companies to raise money abroad to repay domestic loans for the precedence of the money abroad is not known. Even as the deal has to be through an ECB, which can be given only by eligible lenders, who are also regulated entities. But there is some element of gray area that is beyond the scope of the RBI or any other Indian regulator to find out.
The fine print
Corporates can raise long-term ECB loans for working capital, general purpose, and to repay domestic loans
Banks or corporates can sell bad loans directly to ECB lenders abroad
Loans raised will be part of one-time settlement with companies
Loans with minimum average maturity of 7-10 years can be raised to repay domestic loans
RBI was earlier opposed to raising ECBs to repay domestic loans
Experts say the move can raise India’s external liability significantly and build up risks
Domestic ARCs to lose business, will be forced to merge

CCD names S V Ranganath as interim chairman; Nitin Bagmane as interim COO

Coffee Day Enterprises on Wednesday named independent director S V Ranganath as the interim chairman of the company to replace its founder V G Siddhartha, who has been confirmed dead days after he went missing. The company board, wherein Siddhartha's wife Malavika Hegde is also a director, met on Wednesday to put in place a working structure of the company.
The board appointed "S V Ranganath as the interim chairman of the board" and "Nitin Bagmane as an interim chief operating officer (COO) of the company," Coffee Day Enterprises, which runs India's biggest coffee chain CCD, said in a regulatory filing.

It also constituted an executive committee comprising Ranganath, COO Nitin Bagmane and CFO R Ram Mohan "to exercise the powers previously vested with the Chief Executive Officer of the company and the Administrative Committee constituted by the Board in 2015," it said.
"The board will, in due course, prepare a detailed charter of authorities vested in the Executive Committee and approve the same," the filing said.
The Executive Committee will explore opportunities to deleverage the Coffee Day Group, it said.
The body of Siddhartha, who had been missing since Monday evening, was found on Wednesday in the Netravati river in Dakshina Kannada district of Karnataka after 36 hours of intense search, officials said.
Siddhartha purportedly wrote a letter indicating he was anxious about pressure from banks, investors and the tax authorities before he went missing.
"The board took cognizance of statements in the purported letter from V G Siddhartha relating to financial transactions outside the knowledge of the senior management, auditors and the board.
"While the authenticity of the letter is unverified and it is unclear whether these statements pertain to the company or the personal holdings of V G Siddhartha, the board took serious note of the same and resolved to thoroughly investigate this matter," the filing said.
The board expressed its condolences to Siddhartha's family and resolved to lend its support and expressed full confidence in the company's management team.
"The board also took note of a message from Malavika Hegde expressing support and trust in the company's professional team and the common effort to look after the interest of the employees and all other stakeholders," it said. "The board remains deeply committed to safeguarding the interests of all stakeholders, including investors, lenders, employees and customers." The company said the Audit Committee and Executive Committee will engage in discussions with the statutory auditors of the company and such other advisors as may be necessary with a view to recommend appropriate next steps to the board at its forthcoming meeting on August 8.
The board has also appointed Cyril Amarchand Mangaldas as its legal counsel to advise on these matters.

Mutual funds face Rs 193-crore exposure to VG Siddhartha-related companies

Mutual funds have exposure worth more than Rs 193 crore to Coffee Day Natural Natural Resources and Tanglin Developments, related to V G Siddhartha.
Siddhartha, the chairman of Coffee Day Enterprises, was found dead on Wednesday.

Data compiled by financial information provider Morningstar showed that mutual funds have exposure to the tune of Rs 148.71 crore to Coffee Day Natural Resources Pvt Ltd.
The exposure to Tanglin Developments Ltd is little over Rs 44 crore, as per the data shared with PTI.
Out of the total, DSP Credit Risk Fund has the highest exposure of Rs 132.08 crore to Coffee Day Natural Resources. BOI AXA S/T Income and BOI AXA Credit Risk Fund also have investments in the company, the data showed.
Indiabulls Income Fund, Indiabulls Savings Income Fund and Indiabulls Short Term Fund have exposure to Tanglin Developments, which is into real estate activities.
Meanwhile, Siddhartha -- the founder of cafe chain Cafe Coffee Day -- was director on six companies registered with the corporate affairs ministry.
The companies are Coffee Day Global Ltd, Coffee Day Enterprises Ltd, Coffee Day Kabini Resorts Ltd, Coffee Day Resorts (MSM) Pvt Ltd, Sivan Securities Pvt Ltd and Ittiam Systems Pvt Ltd, according to data available with the ministry.

Cafe Coffee Day founder V G Siddhartha's body found from river: Report

The body of Cafe Coffee Day founder V G Siddhartha has been found from the Nethravathi river, according to TV reports on Wednesday.
Siddhartha's body was found on the banks of the river near the Hoige Bazaar in Mangaluru, according to news agency ANI.
Siddhartha, the founder of India’s largest coffee chain, went missing on Monday night en route to the coastal Karnataka city of Mangaluru, with a letter purportedly written by him showing he was under "tremendous pressure" from lenders and one of the private equity partners (PEs). The letter also alleged "a lot of harassment" from tax authorities.
ALSO READ: VG Siddhartha's wife to IAS officer: Who are the CCD board members?
A massive search operation involving teams of the National Disaster Response Force, Coast Guard, Home Guard, fire services and coastal police had continued throughout Tuesday. Search teams had scoured the waters under a bridge across the Nethravathi river near Mangaluru where the 60-year-old businessman was reportedly last seen.

The son of a coffee plantation owner, Siddhartha had created the Indian rival to Starbucks. Coming from a family that has a 140-year history of growing coffee, he initially dabbled in stock trading, before setting his foot in the coffee business.
After being inspired by a chat with the owners of German coffee chain Tchibo, Siddhartha decided to open his own chain of cafes in India. With the tag line 'A lot can happen over a cup of coffee', he opened Cafe Coffee Day's first outlet on Bangalore's upscale Brigade Road in 1994.
ALSO READ: Life and times of V G Siddhartha: From coffee planter's son to CCD founder

It's now the largest chain of coffee shops in India, with 1,750 cafes in more than 200 cities, including outlets in Prague, Vienna and Kuala Lumpur. Coffee Day went public in 2015.
In 1999, Siddhartha was roped in by IT veteran Ashok Soota when Subroto Bagchi, Rostow Ravanan and KK Natarajan were putting together IT firm Mindtree.
He was once the largest shareholder of Mindtree but decided to cash out. In March this year, he sold out his 20.41 per cent stake in MindTree to Larsen & Toubro (L&T), making close to Rs 2,858 crores profit. That deal helped him repay his debt of about Rs 2,900 crore.

FPIs pull out over Rs 11,000 crore in July, highest in nine months

Overseas investors have pulled out over Rs 11,000 crore (nearly $2 billion) from Indian equities in July, the steepest outflow in nine months, on account of multiple headwinds, including the tax on ‘super-rich’ announced in Budget 2019-20.
After turning net buyers for the fifth straight month till June, foreign portfolio investors (FPIs) withdrew a net of Rs 11,743 crore ($1.7 billion) in July. This was their highest outflow since October 2018, when they had pulled out Rs 28,921 crore ($3.93 billion) from the equity market. Between February and June, 2019, they pumped net amount of Rs 82,910 crore ($12.7 billion) in equities, according to the depository data.

“Higher taxation for FPIs has been a disappointing measure. There is a lack of clarity from the government on the policy front, which has somehow upset the overseas institutional investors,” says Ajay Garg, managing director at Equirus Securities.
The FPIs sell-off during the month has seen the benchmark indices S&P BSE Sensex (down 5 per cent) and Nifty 50 (down 6 per cent) register their sharpest monthly fall since September 2018, when they tanked 6.2 per and 6.4 per cent, respectively.
However, despite the announcement, the total cumulative net FPI inflow thus far in the current calendar year has remained positive. FPIs have pumped in net amount of Rs 66,905 crore in first seven months of calendar year 2019. They were net sellers of Rs 3,411 crore during the same period of 2018.
Besides the tax proposals, foreign investors, experts suggest, are also worried about the economic growth amid falling consumption, weak corporate earnings and a patchy monsoon thus far. Going ahead, FPI flows will depend on global cues, performance of key domestic macroeconomic indicators and policies pursued by the government, they say.
“Over the short-term, we believe the second quarter is likely to remain a washout, with the slowdown since the first quarter intensifying in consumption and services. This is a result of the ongoing shadow banking crisis and weak global growth,” says Sonal Varma, managing director and chief India economist at Nomura in a recent co-authored report with Aurodeep Nandi.
On the other hand, domestic mutual funds have been accumulating stocks at lower levels. Their net inflow in equities crossed Rs 10,000 crore mark for the first time since October 2018. They were net buyers of Rs 10,378 crore till Monday, July 29, 2019, shows data.
FPI flows are more volatile in nature in comparison to the FDI flows. With the US Federal Reserve (US Fed) also likely to follow an accommodative monetary policy, this could increase FPI flows in the economy.
“Corporate earnings in the June quarter have not been great and the second quarter will be equally tough. FPI flows in India will also depend upon the global environment. US Fed is also likely to cut rates and one needs to assess their commentary. A lot of damage has already been done at the index level (down around 7 per cent since the Budget in July). So relatively, if the global markets fall, the Indian benchmarks are likely to fall less. FPIs, in my view, are not in a rush to come back to India,” says Andrew Holland, chief executive officer, Avendus Capital Alternate Strategies.

Inflow in Rs crore
Month FPIs Mutual Fund
Oct-18 -28,921 24,047
Nov-18 1,195 5,243
Dec-18 3,143 2,917
Jan-19 -4,262 7,161
Feb-19 17,220 2,173
Mar-19 33,981 -7,396
Apr-19 21,193 -4,600
May-19 7,920 5,163
Jun-19 2,596 6,232
Jul-19 -11,743 10,378
Source: SEBI/NSDL

Eight core sectors' growth drops to 0.2% in June compared to 7.8% last year

Growth of eight core industries dropped to 0.2 per cent in June mainly due to a contraction in oil-related sectors as well as in cement production, according to official data.
The eight core sector industries - coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity - had expanded by 7.8 per cent in June last year.

According to the data released by the government, crude oil output contracted by 6.8 per cent while the refinery segment de-grew by 9.3 per cent.
The cement output declined by 1.5 pe cent.
Snapping its two-month declining trend, the production of fertilisers grew by 1.5 per cent.
Steel and electricity production, however, increased by 6.9 per cent and 7.3 per cent, respectively, during the month under review.During April-June, the eight sectors grew by 3.5 per cent compared to 5.5 per cent in the same period last year.

Fiscal deficit touches Rs 4.32 trillion in Q1, 61.4% of budget estimate

The government's fiscal deficit touched Rs 4.32 trillion for the June quarter, which is 61.4 per cent of the budget estimate for 2019-20 fiscal.
In absolute terms, the fiscal deficit, the gap between expenditure and revenue, was Rs 4.32 trillion at June-end as per data released by the Controller General of Accounts (CGA) on Wednesday.

The fiscal deficit was 68.7 per cent of 2018-19 budget estimate in the year-ago period.
The government estimates the fiscal deficit to be at Rs 7.03 trillion during 2019-20. It aims to restrict the fiscal deficit at 3.4 per cent of the GDP in the current fiscal, same as the last financial year.
The CGA data showed that revenue receipts of the government during April-June, 2019-20 was 14.4 per cent of the Budget Estimate (BE). It was 15.5 per cent of BE in the year-ago period.
In absolute terms, revenue receipts stood at Rs 2.84 trillion at June-end 2019. During the entire year, the revenue receipts have been pegged at Rs 19.77 trillion.
The capital expenditure was 18.8 per cent of the BE. This compares with 29 per cent in the year-ago period, the CGA said.
Total expenditure during April-June period stood at Rs 7.21 trillion or 25.9 per cent of BE. It was 29 per cent of BE in the corresponding period last fiscal.
The government has pegged its total expenditure during the fiscal ending March 2020 at Rs 27.84 trillion.
The CAG said the fiscal deficit figure shown in monthly accounts during a financial year is not necessarily an indicator of fiscal deficit for the year as it gets impacted by temporal mismatch between flow of not-debt receipts and expenditure up to that month on account of various transitional factors both on receipt and expenditure side.

Invesco Oppenheimer buys 11% of Essel group's stake in ZEEL for Rs 4224 cr

Subhash Chandra’s Essel Group, the promoter of Zee Entertainment Enterprises Limited (ZEEL), has sold 11 per cent of it 36 per cent stake to Invesco Oppenheimer Developing Markets Fund for a total consideration value of up to Rs 4,224 crore. The fund already holds 8 per cent stake in the entertainment company. After the additional stake buy, the fund’s shareholding in ZEEL will rise to 19 per cent, while the promoters’ stake will come down to 25 per cent.
The Essel group had in November announced that promoters intended to sell half their stake in ZEEL (which was 42 per cent at the time) to strategic investors, preferably a global tech company. In January this year, Essel group lenders started selling shares in Essel companies like ZEEL and Dish TV to recover the debt accumulated by the company. The parent company had an accumulated debt of Rs 16,000 crore. At the end of the March 2019 quarter, Zee promoters had pledged 66.18 per cent of their shareholding to lenders.

In order to repay the debt, Essel had initiated the process of divesting its key assets, including ZEEL, with an aim to repay all lenders by September 2019. During this divestment process, the group said it received positive responses from multiple partners expressing their interest to buy a stake in ZEEL and other key non-media assets. The company is said to be in talks with Bharti Airtel for the merger of its DTH business, operated as Dish TV, with the telecom giant's digital TV business. The promoters are expected to cash out of the company for Rs 4,500-5,000 crore.
Punit Goenka, managing director and CEO of ZEEL, said: “I’m extremely glad to share that the fund as a financial investor has further reposed its faith in ZEEL. It also gives me immense pleasure to note their strong belief and trust in the intrinsic value of our precious asset. It is the valuable belief and support of our esteemed financial investors that enables us to consistently generate great value, year after year.”
The Invesco Oppenheimer Developing Markets Fund, an investment company registered with the US Securities & Exchange Commission, has a long history of investing in India as a financial investor. The fund has been a financial investor in Zee Entertainment Enterprises Ltd since 2002.

Comcast, partners make offer for stake in Subhash Chandra's Zee Ent

A consortium that includes U.S. cable giant Comcast Corp., James Murdoch’s Lupa Systems and Blackstone Group Inc. has made an offer for a stake in Zee Entertainment Enterprises Ltd., India’s largest private broadcaster, people familiar with the matter said.
The group plans to snap up a 51% stake, which has a market value of about Rs 19,000 crore ($2.77 billion), said one of the people, asking not to be identified as the discussions are private. The bid is non-binding, the people said.

A deal could be announced as soon as Wednesday and there could be more investors, another person said. Deliberations are ongoing and might not result in a deal, the people said. Representatives for Comcast and Blackstone declined to comment, while a representative for Zee had no immediate comment.
Zee, the Mumbai-based broadcaster controlled by former rice trader-turned-media mogul Subhash Chandra, is seeking a strategic investor to help pay off debts of its parent group as well as fend off competition from Netflix, Amazon and hundreds of local TV channels vying to tap India’s booming demand for content.
A deal would give Comcast, Lupa and Blackstone control of Zee’s deep library of content and its ZEE5 platform offering Bollywood films and more than 90 television channels in 12 languages on-demand via Internet. Some of the world’s largest telecommunications companies including AT&T Inc., Vodafone Group Plc and KDDI Corp. have been buying film and television production and cable TV assets to bolster earnings as subscribers level off.
Shares of Zee slipped 0.2% in Mumbai on Tuesday afternoon, while the S&P BSE 100 Index was little changed.

Rajiv Kumar appointed Finance Secretary after Subhash Garg's exit

Rajiv Kumar, currently serving as Financial Services Secretary, was on Tuesday designated as the new Finance Secretary.
The Appointments Committee of the Cabinet headed by Prime Minister Narendra Modi approved the designation of Kumar as the new Finance Secretary, according to an official order.

Kumar is a 1984 batch IAS officer of Jharkhand cadre.
The designation of Kumar as the Finance Secretary comes in the backdrop of transfer of Subhash Chandra Garg as the power secretary.
Garg has already sought voluntary retirement from service.

JLR scouting Chinese partners to ease burden on bottomline: Chandrasekaran

Hit hard by the continuing volume slowdown and mounting losses at its British arm JLR, Tata Motors is looking for partnerships in China to lessen the financial burden on group's bottomline, chairman N Chandrasekaran said on Monday.

Addressing the shareholders at the AGM here, Chandra however, pointed out that the automobile sector is such that a company cannot shut the cash tap as the very of this business demands continuous investment in product and technology development.


Chandra also said, more than the final outcome of the Brexit, it's the continuing uncertainty that is hurting JLR in its home market of England and continental Europe, which is the largest source market for the millions of parts that JLR procures annually.

"The only way to handle the ongoing crisis and the continuing need for large capex is additional investment through partnerships, because we want to spread the investment, which cannot be shut either.

"There are many discussions from tactical to strategic for such partnerships. Opportunities are coming and we keep evaluating them and as long as it is in the interest of Tata Motors. We will forge such partnerships so that we are able to address the capex issue," Chandra told the shareholders.

It can be noted that the woes at JLR, which used to be the group cash-cow for years, the bottomline of Tata Motors has been sinking for the past three successive quarters.

While it made history by booking the largest ever loss by any domestic company for the December 2018 quarter with a mammoth Rs 26,961 crore net loss due to an impairment charges on JLR, last week it reported a net loss of Rs 3,679 crore for the June quarter as against Rs 1,862 crore loss in March 2019.

Stressing on the need to remain continuously invested, he said, like any other auto company, JLR also has to invest in future technologies of hybrid and electric. We also have to invest in the future models and also in areas like shared mobility. That's very important to stay alive in this ecosystem. All this means there is a need for capex if you want to be future ready, he said.

He said JLR has seen its volume plunge around 50 per cent in China, which was its biggest market till the general economic slowdown hit the world's largest auto market since the past two years.

But there are some silverlining in China as "for the first time in 12 months, we are seeing a positive volume growth in China in July after a recovery in June. But we need to wait for a couple of more months to see whether there's a trend."

He said during the past 12-18 months, JLR has cut down capex from around 4.5 billion pounds to 3.9 billion pounds. And we are working towards cutting down further, but we can't take a very drastic cut.

On the Brexit, which has felled two prime ministers- David Cameroon and Theresa May, he said "more than the impact of Brexit, it is the uncertainty of its potential impact, and this is much higher on JLR than any other company.

"The real concern is if Brexit were to happen with or without a deal, what will be the impact on our supply chain. We import millions of components from other parts of the world, particularly Europe. In the situation of Brexit, there's a possibility of a supply chain breakdown which essentially means production cannot happen, inventories are to be maintained.

JLR scouting Chinese partners to ease burden on bottomline: Chandrasekaran

Hit hard by the continuing volume slowdown and mounting losses at its British arm JLR, Tata Motors is looking for partnerships in China to lessen the financial burden on group's bottomline, chairman N Chandrasekaran said on Monday.
Addressing the shareholders at the AGM here, Chandra however, pointed out that the automobile sector is such that a company cannot shut the cash tap as the very of this business demands continuous investment in product and technology development.

Chandra also said, more than the final outcome of the Brexit, it's the continuing uncertainty that is hurting JLR in its home market of England and continental Europe, which is the largest source market for the millions of parts that JLR procures annually.
"The only way to handle the ongoing crisis and the continuing need for large capex is additional investment through partnerships, because we want to spread the investment, which cannot be shut either.
"There are many discussions from tactical to strategic for such partnerships. Opportunities are coming and we keep evaluating them and as long as it is in the interest of Tata Motors. We will forge such partnerships so that we are able to address the capex issue," Chandra told the shareholders.
It can be noted that the woes at JLR, which used to be the group cash-cow for years, the bottomline of Tata Motors has been sinking for the past three successive quarters.
While it made history by booking the largest ever loss by any domestic company for the December 2018 quarter with a mammoth Rs 26,961 crore net loss due to an impairment charges on JLR, last week it reported a net loss of Rs 3,679 crore for the June quarter as against Rs 1,862 crore loss in March 2019.
Stressing on the need to remain continuously invested, he said, like any other auto company, JLR also has to invest in future technologies of hybrid and electric. We also have to invest in the future models and also in areas like shared mobility. That's very important to stay alive in this ecosystem. All this means there is a need for capex if you want to be future ready, he said.
He said JLR has seen its volume plunge around 50 per cent in China, which was its biggest market till the general economic slowdown hit the world's largest auto market since the past two years.
But there are some silverlining in China as "for the first time in 12 months, we are seeing a positive volume growth in China in July after a recovery in June. But we need to wait for a couple of more months to see whether there's a trend."
He said during the past 12-18 months, JLR has cut down capex from around 4.5 billion pounds to 3.9 billion pounds. And we are working towards cutting down further, but we can't take a very drastic cut.
On the Brexit, which has felled two prime ministers- David Cameroon and Theresa May, he said "more than the impact of Brexit, it is the uncertainty of its potential impact, and this is much higher on JLR than any other company.
"The real concern is if Brexit were to happen with or without a deal, what will be the impact on our supply chain. We import millions of components from other parts of the world, particularly Europe. In the situation of Brexit, there's a possibility of a supply chain breakdown which essentially means production cannot happen, inventories are to be maintained.

Curious case of CCD founder: V G Siddhartha was under heavy debt burden

As the search for Coffee Day founder VG Siddhartha continues, the mystery behind the entrepreneur going missing has become murkier with the emergence of a letter addressed to the company board. Though the genuineness of the letter is yet to be established, Siddhartha has allegedly pointed out the pressure from private equity firms for early exits.
Coffee Day Enterprises, the holding firm of Coffee Day, had a total debt of around Rs 6,550 crore as on March 2019. Sources in the know said that debt level of the entity had drastically reduced after Siddhartha's stake sale in Mindtree.
In March this year, he had sold his entire 20.32 per cent stake in the Bengaluru-headquartered IT services firm to engineering major, L&T for around Rs 3,200 crore, which had been utilised to pare some debt from Coffee Day Enterprises' balance sheet. Industry experts said that the Mindtree stake sale to L&T despite opposition from its founders could be linked to the desperateness of Siddhartha to reduce the company's debt, which was taking a toll on the working capital need of the firm due to high-interest outgo. Recently, news reports also suggested that the Coffee Day Group was in talks with global beverage maker Coca-Cola for selling a slice of its equity at an enterprise valuation of around Rs 10,000 crore.
Cafe Coffee Day (CCD), set up in August 1996, has grown to include 1,750 stores across India with 60,000 vending machines as of now. It also has outlets across Europe as well as in Malaysia, Nepal, and Egypt. The group's coffee business, which includes some exports of the bean, reported a revenue of Rs 1,777 crore in FY18 and Rs 1,814 crore in FY19.
Other than the coffee retail chain and his investment in tech firms, the Coffee Day Group has diversified in its bid to emerge as a business conglomerate. The group forayed into real estate through its wholly-owned subsidiary called Tanglin, which develops technology parks and Special Economic Zones for the IT industry. Its logistics arm, Sical, provides end-to-end solutions in port handling, road, and rail transport areas. The group has also ventured into hospitality through Coffee Day Hotels & Resorts. Way2Wealth is a leading financial service provider from Coffee Day's stable.
Though the total enterprise value of the group is yet to be ascertained as most of them are privately held but some reports had suggested that private equity major Blackstone was in talks to buy a majority stake in Siddhartha’s real estate venture Tanglin Developments for around Rs 2,800 crore. Tanglin has a tech park - 'Global Village', which is a 4-million-sq ft tenanted office space located on a 120-acre campus in Bengaluru, and counts Accenture and Mphasis among its tenants, besides having the headquarters of Mindtree.
"With rising competition from new retail chains and capital intensive nature of some of his businesses, Siddhartha was under pressure. But, the group has better financial health than many other debt-laden conglomerates," said a person familiar with the businesses of Coffee Day Group.

In last letter to CCD board, Siddhartha blamed lenders, tax authorities

In his last letter to the Coffee Day Enterprises' board of directors dated July 27, its co-founder V G Siddhartha said he had fought for a long time, but was giving up as he could not take any more pressure from one of the private equity partners who was forcing him to buy back shares. Siddhartha, who is missing since Monday night, had said that "tremendous pressure" from other lenders had made him succumb to the situation.
In the letter, Siddhartha also alleged harassment by the previous DG, Income Tax in the form of attaching of shares on two separate occasions to block the Mindtree deal and then taking possession of Cofee Day shares.
The contents of the letter were posted on Twitter by CNBC-TV18.
Siddhartha, former Karnataka chief minister SM Krishna's son-in-law, is suspected to have jumped off a bridge in Mangaluru on Monday night, the Times of India reported on Tuesday. According to the report, the news emerged after the Mangaluru City Police started a search for a person who had jumped off the kilometre-long Ullal bridge on Monday night.
ALSO READ: Cafe Coffee Day founder VG Siddhartha missing in Mangaluru: Report
"I would like to say I gave it my all. I am very sorry to let down all the people that put their trust in me," he wrote in the letter, which was also addressed to the wider Coffee Day family. "I fought for a long time but today I gave up as I could not take any more pressure from one of the private equity partners forcing me to buy back shares, a transaction I had partially completed six months ago by borrowing a large sum of money from a friend. Tremendous pressure from other lenders lead to me succumbing to the situation," he added.
Siddhartha also said that there was "a lot of harassment from the previous DG income tax in the form of attaching our shares on two separate occasions to block our Mindtree deal and then taking position of our Cofee Day shares, although the revised returns have been filed by us".

ALSO READ: Coffee Day Enterprises tanks 20% as co-founder VG Siddhartha goes missing
"This was very unfair and has led to a serious liquidity crunch," he added.
Siddhartha stated that he had failed to create the "right profitable business model" despite his best efforts.
In the letter, Siddhartha requested the board and the company's officials "to be strong and to continue running these businesses with a new management".
Taking full responsibility, he wrote, "I am solely responsible for all mistakes. Every financial transaction is my responsibility. My team, auditors and senior management are totally unaware of all my transactions. The law should hold me and only me accountable, as I have withheld this information from everybody including my family."
Stating that his intention was never to cheat or mislead anybody, Siddhartha wrote that he had "failed as an entrepreneur". He added, "This is my sincere submission, I hope someday you will understand, forgive and pardon me."
Siddhartha concluded the letter, in which he had enclosed a list of assets and their tentative value, by stating that the assets outweighed the liabilities and could "help repay everybody".

Cafe Coffee Day founder VG Siddhartha missing in Mangaluru: Report

Cafe Coffee Day (CCD) founder and former Karnataka Chief Minister, SM Krishna's son-in-law, V G Siddhartha, is suspected to have jumped off a bridge in Mangaluru on Monday night, the Times of India reported on Tuesday.
According to the report, the news emerged after the Mangaluru City Police started a search for a person who had jumped off the kilometre-long Ullal bridge on Monday night.

The report said that one of the police officers confirmed that a person was suspected to have jumped off the Ullal bridge, which is built across the River Nethravathi, at 9pm. A search operation is now underway while his mobile phone is reported to be switched off.
According to the report, based on the statement of a person, reportedly a car driver, the person in question is suspected to be Siddhartha.
Karnataka: People gather at former Karnataka CM, SM Krishna's residence in Bengaluru; His son-in law & founder-owner of Cafe Coffee Day, VG Siddhartha, has gone missing near Netravati River in Mangaluru. pic.twitter.com/tj04e5eoYO
— ANI (@ANI) July 30, 2019
Siddhartha had been in the news earlier this year when news agency PTI had reported that IT company Mindtree found certain irregularities in disclosures made by him.
Siddhartha had sold his stake in Mindtree to L&T, and it had taken action against him according to the law.
ALSO READ: We believe in VG Siddhartha, still own 6% in CCD: Global buyout major KKR
"On the pledge disclosure issue, there was a disclosure that he made at certain point of time of all the pledge. At that point of time, there were some irregularities in his disclosures. Our board and audit committee evaluated it and handled it as per the rule that were prevailing at that point of time," Mindtree CEO Rostow Ravanan had said back then.
In this regard, the report said, while citing sources, a complaint against Siddhartha alleging insider trading during his stint at Mindtree was also filed with the Securities and Exchange Board of India (Sebi) by an anonymous person.
The report added that the complaint filed against Siddhartha had alleged that he and his firm Coffee Day group had sold shares that were pledged before various financial institutions.
Further, the sources told the news agency that the complaint argued that if these shares were pledged, a disclosure should have been made about these pledges under the Sebi Insider Trading Regulations and Sebi Takeover Regulations.

I-T Dept disputes Siddhartha's letter to CCD board alleging tax harassment

The Income Tax Department on Tuesday denied charges of harassment during their probe against Café Coffee Day promoter V G Siddhartha and official sources pointed out that the signatures of the entrepreneur available with them were different from those on a letter being widely published on the social media.
They said the businessman had admitted holding stash income after raids were conducted against him and his concerns.
ALSO READ: Coffee Day Enterprises tanks 20% as co-founder VG Siddhartha goes missing
In the unverified letter, Siddhartha, who has gone missing on his way to Mangaluru from Bengaluru in Karnataka, said there was a lot of harassment from the previous DG of the Income Tax Department in the form of attaching "our shares on two separate occasions to block our Mindtree deal and then taking position of our Coffee Day shares, although revised returns have been filed by us (sic)".
"This was very unfair and has led to a serious liquidity crunch," the letter, bearing a purported signature of Siddhartha, said.
ALSO READ: With founder Siddhartha missing, will Cafe Coffee Day get sold to PE firms?
Refuting the charges, the official sources said the the provisional attachment of shares was made by the department to protect the "interests of revenue" in cases of large tax evasion and the action was based on "credible evidence" gathered in the search or raid action that was undertaken against the Bengaluru-based group in 2017.
"The department has acted as per provisions of the Income Tax Act," one of sources told PTI.
The authenticity of the note circulating on the social media cannot be vouched for as Siddhartha's signature "does not tally" with what is available with the department in the form of annual reports of the company, the source said quoting official records.
They said Siddhartha fetched Rs 3,200 crore from the sale of Mindtree shares, but has paid only Rs 46 crore out of the total Rs 300 crore minimum alternate tax (MAT) payable on the deal.
The raids against the group were carried out as a result of a similar action against a prominent Karnataka politician and sources said Siddhartha, in a sworn statement, "admitted" unaccounted income of Rs 362.11 crore and Rs 118.02 crore in his hands and that of Coffee Day Enterprises Ltd respectively.
They alleged that tax sleuths recovered numerous messages from his mobile phone that indicated his "active involvement in cross-border hawala transactions."

A Singaporean citizen was searched in this case and he was found with unaccounted cash of Rs 1.2 crore and the person told tax officials that it belonged to Siddhartha, they claimed.
They alleged that the CCD promoter filed his IT returns but "did not" mention the undisclosed income, as admitted in the sworn statement, in both the cases except an amount of around Rs 35 crore in his individual case.
"Even on this admitted sum, Siddhartha did not pay the self-assessment tax of Rs 14.5 crore as quantified by him as on date. Coffee Day Enterprises Ltd did not offer the admitted income in its part," the source said.
They said the department got to know through media reports in January this year that Siddhartha was planning to sell the equity shares of Mindtree Ltd, held by him and his company, on an immediate basis.
Tax officials found that Siddhartha and Coffee Day Enterprises Ltd together held nearly 21 per cent of shareholding in Mindtree Ltd and it was also found that the deal for sale of shares was set to be finalised within that month, they said.
As the tax revenue ramification in this case was worth crores and the assessee had not taken permission from the I-T authorities for selling these shares, they were attached as per the norm, they said.
Mindtree Ltd's 74,90,000 shares were attached and such an action is a normal requirement to protect the interests of revenue in big cases of tax evasion, they said.
They said Siddhartha then filed a request letter to release these shares and offered other shares of Coffee Day Enterprises Ltd as security against the expected demand.
The department accepted this request and the attachment of Mindtree shares were revoked on February 13 this year, they said.
However, a specific condition was put by the department that the sale proceeds will be utilised only for repayment of loans availed against the Mindtree Ltd shares by opening escrow account and the remaining balance will be provided for attachment to the department against the tax liability to arise.
"The alternate attachment of 46,01,869 unencumbered shares and 2,04,43,055 encumbered shares of Coffee Day Enterprises Ltd was made on February 13-14," they said.
The assessee (Siddhartha) had transferred the Mindtree Ltd shares to L&T Infotech Ltd on April 28 and received around Rs 3,200 core, they said.
Out of this consideration, they said, Siddhartha and his company repaid loan of around Rs 3,000 crore and paid expenses related to transfer of Rs 154 crore and the balance of Rs 46 crore was paid towards first instalment of advance tax of estimated MAT liability of around Rs 300 crore in the case of shares of Coffee Day Enterprises Ltd.
The CCD promoter is the son-in-law of former Karnataka chief minister and BJP leader S M Krishna and was last seen near a bridge on Netravati river in Kotepura area in Dakshina Kannada district on Monday night.
Authorities have launched a massive search for him.

RBI set to review foreign bond sale plan after economists flag risk

India’s central bank plans to discuss next month the government’s proposal to raise foreign currency debt, people familiar with the matter said, amid risks flagged by economists about the plan.
The Reserve Bank of India’s board will meet on August 16 to discuss, among others, the nation’s proposed maiden offshore bond sale plan, the people said, asking not to be identified as they are not authorized to speak on the subject.

The offering is mired in confusion after an official overseeing the plan was abruptly transferred out of the Finance Ministry last week, amid reports that the Prime Minister’s office had asked for a review. Finance Minister Nirmala Sitharaman said in an interview to the Economic Times newspaper that there’s no rethink and the plan is on course.
The sovereign bond plan was criticized by former RBI Governor Raghuram Rajan as one that has no real benefits and exposes the country to “faddish investors buying when India is hot, and dumping us when it is not.” A key nationalist ally of Modi’s ruling Bharatiya Janata Party has called the proposal a “dangerous idea” that could lead India into a debt trap.
Concerns raised by prominent economists will be discussed by the RBI board, one of the people said.
The 17-member RBI board has representation from two bureaucrats as well as a member of the Swadeshi Jagran Manch, a group affiliated to the ruling party’s ideological parent, the Rashtriya Swayamsevak Sangh.
A spokesman for the central bank declined to comment. The RBI is the debt manager to the government and there is a process of consultation between the central bank and the government, Governor Shaktikanta Das said in an interview last week.

Malaysia's Petronas, Japan's JXTG may buy stake in Bina refinery: Report

Malaysia's Petroliam Nasional Bhd (Petronas) and a consortium led by Japan's JXTG Holdings Inc are among the companies interested in buying a stake in India's Bina oil refinery, a source close to the matter said.
The Bina plant in Madhya Pradesh, capable of processing 156,000 barrels per day (bpd) of crude oil, is operated by Bharat Oman Refineries Ltd (BORL), a 50-50 joint venture between Oman Oil Co and state-run Bharat Petroleum Corp (BPCL).

"There are a new set of companies who have approached BPCL for a stake in its Bina refinery," said the source, who asked not to be named as the discussions are private.
BPCL plans to double the capacity of the refinery in next five years and build a petrochemical complex that would require an investment of about 500 billion rupees ($7.24 billion), the source said.
Bharat Petroleum did not respond to a request for comment. Petronas and JXTG were not immediately reachable for comment.

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Honda recalls 5,088 units of 5 models in India to fix faulty Takata airbags

Japanese auto major Honda on Monday said it is recalling an additional 5,088 units of its previous generation models of Jazz, City, CR-V, Civic and Accord in India as part of a global exercise to rectify faulty Takata airbags.
The company, which is present in India through a wholly-owned arm Honda Cars India Ltd (HCIL), said it has expanded its campaign to replace Takata driver and passenger front airbag inflators in 5,088 units as part of its precautionary global recall campaign concerning Takata front airbag inflators.

It is recalling 2,099 units of City sedan manufactured between 2007- 2013, 2,577 units of CR-V produced between 2003-2008 and in 2011 and 350 units of Accord manufactured in 2003, Honda said.
It is also recalling 52 units of Civic sedan manufactured between 2006-2008 and 10 units of Jazz manufactured between 2009-2012.
The company said replacement will be carried out free of cost at HCIL dealerships across the country from July 29, 2019 and the company will communicate with customers directly.
In April this year, Honda had recalled 3,669 units of Accord sedan in the country as part of a global exercise.
Millions of vehicles globally have been recalled due to defective safety airbag manufactured by Japan's Takata Corp.

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Telcos oppose allocation of 700 MHz spectrum to railways, call for auction

Mobile operators Reliance Jio, Bharti Airtel and Vodafone Idea have vehemently opposed allocation of premium 700 MHz spectrum to Indian Railways for specific services, citing commercial value of such radiowaves and the potential for 4G and 5G offerings.
The mobile telephony services industry -- otherwise polarised over a range of issues -- has spoken in one voice this time to assert that spectrum allotted to the Railways for captive use should not be utilised for commercial services for passengers (wi-fi and internet offerings) as such services should be provisioned by entities that hold a valid licence.

Reliance Jio said that the Railways should not be permitted to offer commercial services like wi-fi and voice and video communication, without obtaining authorisation under the Unified Licence.
The Railways should obtain commercial spectrum for commercial use via auction like all other interested parties, it said.
"... we do not agree with the Indian Railways demand for reserving 15 MHz spectrum in 700 Mhz spectrum band for LTE (Long Term Evolution) based communication corridor...The spectrum in 700 Mhz band should not be allocated to Indian Railways for Radiocommunication Systems between Train and Trackside (RSTT) due to its commercial use and being a backbone band for 4G-5G services," Reliance Jio said in its response to regulatory consultation on the matter.
The suitable allocation for such captive use should be in the 450-470 MHz spectrum band, it opined.
"Department of Telecom (DoT) has rightly noted that considering the limited spectrum available in 700 MHz band and the fact that this digital dividend spectrum has immense potential for coverage in wide and rural areas, the spectrum for Indian Railways may be explored beyond this band and that the spectrum in 450-470 MHz seems most suitable for this purpose," Jio said.
Jio said it strongly disagrees with the proposal to use the RSTT radiowaves for providing Wi-fi services to passengers and using the spectrum for faster data network communication for voice, video and other applications as well as IoT-based services "as the same are commercial services and can be provisioned only under Unified Licence authorisation by DoT".
The operator, however, termed as "valid and legitimate", the Railways' requirements to provide mission-critical passenger safety services and applications, video surveillance through close circuit cameras in trains, along with video analytics.
"The Railways is a commercial organisation and it can very well take the requisite licences and auction acquired spectrum to offer commercial services like Wi-fi... to its customers under the applicable licence and service terms and conditions," Jio has said.
Vodafone Idea argued that if spectrum from 700 MHz band were to be reserved for Indian Railways, there will be insufficient spectrum left for 4G/5G services (considering that 3-4 service providers will be providing services in each service area), in effect, jeopardising growth plans of the telecom operators.
Hence, it said, spectrum in 700 MHz band should be allocated and utilised only for IMT (international mobile telecom) services, Vodafone Idea said.
Vodafone Idea further said spectrum should not be reserved or assigned to Indian Railways for commercial purposes to meet the communication needs of the railway passengers, which the operator felt should be served through the telecom service providers' networks.
"The Indian Railways may avail and utilise the spectrum for their captive/internal purposes such as for passenger safety, train positioning and security purposes or requirements," it said.
Bharti Airtel also felt that spectrum in 700 MHz band should not be allocated to Indian Railways, and should only be made available to the licensed telecom operators via due auction process.
Indian Railways can be allocated the 450-470 MHz for deployment of LTE based RSTT, it added.
"Since the 700 MHz band has a huge potential for being used for provision of commercial IMT services and for providing improved coverage to the subscribers, it is recommended that any entity desiring to have spectrum in this band should pay the market determined price as determined in auction," Airtel said in its response to the consultation paper on 'allotment of spectrum to Indian Railways for public safety and security services'.
Airtel said it does not support any provision of internet services by Indian Railways with the use of spectrum assigned for signalling purpose, since this would result in "unfair competition and direct substitute" to the services provided by existing licensed operators who acquire spectrum through auction.
Provision of internet services onboard should be done by facilitating the operators to install their own infrastructure, it pointed out.

Modi, Shah might meet J&K BJP leaders before election dates are announced

Prime Minister Narendra Modi is expected to attend a meeting of BJP's Jammu and Kashmir core group called here on Tuesday, with top party leaders, including its chief Amit Shah, set to discuss political atmosphere and party's preparedness for assembly elections whenever they are held, sources said.
The likely presence of Modi and Shah in the meeting is significant and hints at the party gearing up for the state assembly elections, whose schedule will be finalised by the Election Commission after it receives a go-ahead from the central and state governments on law and order situation.

The sources said Union minister Jitendra Singh, BJP general secretary Ram Madhav and its state unit president Ravinder Raina and other senior leaders from the state will attend the meeting besides the party's national working president JP Nadda.
Earlier, Madhav, who is the party's pointsman for Jammu and Kashmir, had urged the Election Commission to hold polls in the state this year.
The state BJP has asserted that it is ready for elections anytime, with its general secretary Narinder Singh saying that there is still enough time left for the EC to hold polls this year.
In 2014, the state polls were held in November-December.
Jammu and Kashmir is currently under President's Rule. It was extended for one more term of six months beginning July 3.

BJP accuses Congress of forging signatures of absent MLAs in MP assembly

Days after two BJP MLAs voted in favour of the Kamal Nath government in Madhya Pradesh, the saffron party on Sunday accused the ruling Congress of forging the signatures of 8 to 12 legislators during voting on a bill, although they were "not present" in the Assembly.
The BJP is now mulling approaching the state Governor with a request to verify the signatures of the Congress MLAs who participated in the voting on the Criminal Law (Madhya Pradesh Amendment) Bill.

On Wednesday, two BJP MLAs - Sharad Kol (Beohari) and Narayan Tripathi (Maihar) - backed the seven-month-old Nath government during voting on the Criminal Law (Madhya Pradesh Amendment) Bill, 2019, in the Assembly.
Talking to PTI on Sunday, Leader of the Opposition in MP Assembly Gopal Bhargava said, "We have come to know that some 8 to 12 Congress MLAs were not present when the Criminal Law (Madhya Pradesh Amendment) Bill was put to vote on Wednesday."
"Right now, we are studying the powers of the governor so that we can petition him with the request to verify the signatures of the Congress MLAs who participated in the voting," he said.
"We suspect that their (8 to 12 Congress legislators) signatures were forged," he said, adding that the voting procedure was not video-graphed.
"We have learnt that 8 to 12 Congress members were not present in the House. So how come they got 122 votes?" he asked.
In the 230-member Assembly, the ruling Congress has the support of 121 MLAs.
It has 114 MLAs - two short of the simple majority mark of 116 - and its government is being supported by four Independent legislators, two MLAs of the Bahujan Samaj Party (BSP) and one from the Samajwadi Party (SP).
"I had already spoken to MP Assembly Principal Secretary A P Singh over phone and asked him to seal the entire voting procedure. I could not raise the issue in the House as it was adjourned after the voting," Bhargava said.
Congress MLA Sanjay Yadav, however, said that Bhargava was present in the House that time and he should have himself checked the voting procedure then.
"Nobody had stopped him then. Why is he complaining now?" he asked.
"In fact, their 50 members (legislators) were not present in the House," Yadav said and alleged that the BJP was in the habit of speaking lies.

Adani Group to invest Rs 5,500 cr in UP's food processing, power sectors

Adani Group will invest Rs 5,500 crore over the next five years in power transmission and food processing sectors in Uttar Pradesh, its chairman Gautam Adani said on Sunday.
Speaking on the occasion of the second ground breaking ceremony that will see the launch of multiple projects by corporates, Adani said he had announced his investment plans during UP investors' summit in February 2018 and the work on two power transmission projects has already started.

Under the food processing segment, rice and flour mills, kachchi ghani refining facility will be set up in the state, he said.
"In the next five years, the group is planning to invest Rs 5,000 crore in power transmission and another Rs 500 crore in food processing sector," Adani said.
Talking about his plans to focus also on other areas such as data centre and defence, he said that going by the size, population and strategic location and demographic dividend of the state, Uttar Pradesh can emerge as a leader in these sectors as well.
"...our presence in the defence sector is very important for us. It is my dream that Adani Group sets up world-class defence manufacturing hub in the defence corridor in Uttar Pradesh," he said.
Saying that his group has set up units having the capacity of 15,000 metric tonne in Kannauj for improving the foodgrain storage capacity in the state, he said it was already working on developing multi modal river terminal in Varanasi for enhancing the waterways.
Underlining that the development story of the country is incomplete without Uttar Pradesh, Adani said the state is being viewed as the fastest changing and it will play an important role in reaching the target set up by Prime Minister Narendra Modi of $5 trillion economy by 2024.

West Indies tour: No pre-departure press conference by Indian team

Before leaving for the West Indies tour, the Indian team will not hold any pre-departure press conference, a BCCI source said on Sunday.
"There will be no pre-departure press conference by the Indian team leaving for the West Indies. There is no window for a press conference ahead of the departure. We tried but it was not possible," a BCCI source told ANI.
The Men in Blue, who will be leaving on Monday, will take on the Carribean side in three T20Is, three ODIs and two Test matches.
Team India chief selector MSK Prasad had on July 21 announced the squads at the Board of Control for Cricket in India (BCCI) headquarters here.
Putting speculation to rest over India captain Virat Kohli's participation in the limited-overs series, he was chosen to lead the team in all formats.
Batsman Shikhar Dhawan, who was ruled out of the World Cup after sustaining a left-hand injury, has returned to the side for the ODIs and T20Is matches.
However, fast bowler Jasprit Bumrah has been rested for the three ODIs and as many T20Is.
Wicket-keeper and batsman MS Dhoni has been rested as well and Rishabh Pant will be keeping the wickets. Pant was named across all three formats while Wriddhiman Saha has found a spot for the two Tests.
Krunal Pandya and Manish Pandey, who were in brilliant form in the recently concluded unofficial ODI series against West Indies A, have also been named in the T20I squad.
Ravindra Jadeja, who gave an impressive performance in the World Cup semi-final, has also found a spot for all the three formats. Ajinkya Rahane, Ishant Sharma, R Ashwin and Umesh Yadav have been included for the Tests.
Following are the squads for West Indies tour:
T20Is: Virat Kohli (c), Rohit Sharma (vc), Shikhar Dhawan, KL Rahul, Shreyas Iyer, Manish Pandey, Rishabh Pant (wk), Krunal Pandya, Ravindra Jadeja, Washington Sundar, Rahul Chahar, Bhuvneshwar Kumar, Khaleel Ahmed, Deepak Chahar and Navdeep Saini.
ODIs: Virat Kohli (c), Rohit Sharma (vc), Shikhar Dhawan, KL Rahul, Shreyas Iyer, Manish Pandey, Rishabh Pant (wk), Ravindra Jadeja, Kuldeep Yadav, Yuzvendra Chahal, Kedar Jadhav, Mohammed Shami, Bhuvneshwar Kumar, Khaleel Ahmed and Navdeep Saini.
Tests: Virat Kohli (c), Ajinkya Rahane (vc), Mayank Agarwal, KL Rahul, Cheteshwar Pujara, Hanuma Vihari, Rohit Sharma, Rishabh Pant (wk) Wriddhiman Saha (wk), R Ashwin, Ravindra Jadeja, Kuldeep Yadav, Ishant Sharma, Mohammed Shami, Jasprit Bumrah and Umesh Yadav.

Govt plans to list 3-4 regional rural banks on stock exchanges this year

The government is planning to list three to four financially strong regional rural banks (RRBs) on stock exchanges in the current fiscal after the conclusion of consolidation exercise, sources said.
The bank consolidation exercise is going on as the objective is to bring the number of RRBs to 38 from the current 45, they said, adding that some more consolidations will take place as state governments have given their go-ahead.

Amalgamation of RRBs within a state has been carried out with a view to enable RRBs to minimise their overhead expenses, optimise the use of technology, enhance the capital base and area of operation and increase their exposure, sources said.
As many as 21 banks were amalgamated in various states in the last few months to create a large entity so that they can enjoy the benefit of economies of scale.
They further said that three to four RRBs are eligible to come out with initial public offer (IPO) and they may hit the capital market this year.
These banks were formed under the RRB Act, 1976 with an objective to provide credit and other facilities to small farmers, agricultural labourers and artisans in rural areas.
The Act was amended in 2015 whereby such banks were permitted to raise capital from sources other than the Centre, states and sponsor banks. Currently, the Centre holds 50 per cent in RRBs, while 35 per cent and 15 per cent are with the concerned sponsor banks and state governments, respectively.
Even after stake dilution, the shareholding of the Centre and the sponsor public sector banks together cannot fall below 51 per cent according to the amended Act.
As a result, the ownership and control would remain with the government. In order to improve the financial health of RRBs, the government initiated consolidation of RRBs in a phased manner in 2005. The number of RRBs came down to 133 in 2006 from 196 at the end of March 2005. It further came down to 105 and to 82 at the end of March 2012 and subsequently to 56.
Budget 2019-20 has provided Rs 235 crore towards recapitalisation of RRBs.
Recapitalisation support is provided to RRBs to augment their capital so as to comply with regulatory capital requirements.
As per the current scheme for recapitalisation of RRBs, the recapitalisation support is provided to RRBs by the Centre, concerned state governments and the sponsor banks in the ratio of 50:15:35, respectively to enable them to meet the regulatory requirement of capital to risk weighted assets ratio (CRAR) of 9 per cent.

India's path to become a $5 trillion economy passes through UP: Amit Shah

India’s path to become a $5 trillion economy passes through Uttar Pradesh, said home minister Amit Shah on Sunday in Lucknow where a ground-breaking ceremony began work on 292 projects worth Rs 65,000.
Prime Minister Narendra Modi’s government had spurred competition among states for attracting investments and introducing their ranks in the ‘Ease of Doing Business’ index, said Shah.

“Earlier, it was said the path for becoming the country’s Prime Minister passed through Lucknow. However, the path for India to become $5 trillion economy also traverses through Lucknow,” he said about the state capital.
“When PM Modi talked about the $5 trillion dream, there were voices of dissent. However, the Modi government during 2014-19 had already laid a strong foundation for achieving the target,” he said.
India was world’s 11th biggest economy in 2004 when the BJP government led by Atal Bihari Vajpayee lost power. “When we came to power in 2014, the country was still on the same place and the previous dispensation was taking pride that India did not slide further in their regime,” Shah said, referring to the Congress-led United Progressive Alliance government.
Shah said Chief Minister Adityanath’s government had changed the perception about Uttar Pradesh by improving the rule of law and controlling crime.
“When Yogi ji was selected to lead the state in 2017, some people had called me up to say that he (Yogi) lacked past administrative and political experience to lead a big state like UP. But, Modi ji and I were convinced of his abilities springing out of diligence and full commitment,” he said about the BJP leader.
The ground-breaking started work on projects in agriculture, tourism, micro small and medium enterprises (MSME), excise, healthcare, power, textile, urban development, science & technology, green energy, and other fields.
Adani Group chairman Gautam Adani, Tata Sons chief N Chandrasekaran, Lulu Group chairman Yusuf Ali, Pepsico India chief Ahmed El Sheikh, and Samsung Electronics Southwest Asia president and CEO H C Hong were guests at the ceremony.
These projects are part of the Rs 4.68 trillion worth of 1,047 memorandums of understanding the Adityanath government signed with public and private sector companies at the ‘UP Investors Summit’ in Lucknow on February 21-22.

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Jaipal Reddy: The orator, Congress leader who never compromised on values

Known for his oratorical skills and outspokenness, veteran Congress leader and former union minister Jaipal Reddy never compromised on values throughout his political journey and did not hesitate to even oppose his then political boss, former Prime Minister Indira Gandhi, on promulgation of Emergency.
The former Union Minister for Information and Broadcasting died at a hospital here early Sunday.
Reddy's limited physical mobility due to polio never deterred him from achieving political heights and he served as a Lok Sabha MP for five terms, as a member of Rajya Sabha for two terms and was a four-term MLA.
After coming out of the Congress following imposition of Emergency, he joined the Janata party and contested against Indira Gandhi in Medak Lok Sabha constituency in 1980.He later joined its splinter group Janata Dal.
Besides earning him accolades, his exceptional oratorical skills and articulation made him the spokesperson for the United Front and National Front governments and the Congress Party.
Reddy was a staunch supporter of separate statehood for Telangana. Congress leaders recalled that he played a crucial role in convincing the UPA-II government and the AICC President Sonia Gandhi to grant separate statehood to Telangana.
In an interview to a Telugu news channel, Jaipal Reddy had said though he was offered the post of chief Minister of Andhra Pradesh during the separate Telangana agitation, he had declined it.
Reddy was a guiding force for Telangana Congress leaders who were agitating during the separate Telangana struggle in early in 2010
Born on January 16, 1942 in Madgul of Mahabubnagar district of Telangana, Reddy did his masters in English literature and was a student leader in the early 1960s.
A parliamentarian for several decades, he held key portfolios in various governments.He was conferred the Best Parliamentarian Award in 1998.
He was a member of the Andhra Pradesh (undivided) Legislative Assembly from 1969 to 1984.
Reddy was elected to the Lok Sabha for the first time in 1984 and was a member of the Rajya Sabha for two terms-1990-96 and 1997-98.
He became the Leader of the Opposition in the Upper House in 1991-1992.
He rejoined the Congress in 1999 and was elected to the Lok Sabha from Miryalguda in 2004 and in 2009 from Chevella constituency.
Jaipal Reddy lost the Lok Sabha polls from Mahabubnagar in 2014 and did not contest the 2019 General elections.
He served as Union Minister of Information and Broadcasting in the IK Gujral government and was allotted different portfolios in the Manmohan Singh government.In UPA-2, he was assigned the urban development ministry.
Later, he became the minister of petroleum and natural gas, but was shifted to the science and technology and earth sciences ministries, creating a political storm.
It was widely speculated that Jaipal Reddy was shunted out of the petroleum ministry owing to the notices issued to certain oil and gas companies on production issues.
He also authored some books, including "Ten Ideologies: The Great Asymmetry between Agrarianism and Industrialism."

His brother Sudini Padma Reddy recalled that he never encouraged family politics.
"He was very disciplined and committed. He never encouraged family members entering politics and kept all of us (brothers and sons) away form politics. Our roles used to be confined to only campaigning during elections, but never in active politics," he said.
In an informal chat with friends, Jaipal Reddy once said he and former Defence Minister A K Antony were two prominent Congress leaders who did not encourage their children to join politics.
Reddy's nephew Vijayender Reddy said the late leader's sons are into various businesses.

Modi lauds Chandrayaan-2 in Mann ki Baat, says it taught two great lessons

Prime Minister Narendra Modi said on Sunday that the two "greatest lessons" he learnt from the Chandrayaan-II mission are "faith and fearlessness" and also announced a quiz competition whose winners will get an opportunity to visit Sriharikota to witness the moment the spacecraft will land on moon in September.
In his monthly 'Mann ki Baat' address, Modi said the way scientists rectified technical issues, which caused ISRO to defer its launch by a few days, is exemplary and unparalleled.
"If you ask me what the two greatest lessons I have received from Chandrayaan II, I shall say they are faith and fearlessness. We should trust our talents and capacities; we should have faith in them," he said.
"We should feel proud of the fact that despite hindrances, there is no change in the arrival time. We should trust our talents and capacities; we should have faith in them," he said.
Hailing the indigenous project, he said it is "thoroughly Indian in heart and spirit. It is completely a swadeshi, home grown mission."
He hoped that the Chandrayaan II mission will inspire youth towards science and innovation, saying that science is the path to progress.

"This mission has proved beyond doubt, once again, that when it comes to attempting an endeavour in new age, cutting edge areas, with innovative zeal, our scientists are second to none. They are the best, they are world class," the prime minister said.
Asking students to participate in the quiz, whose details will be out soon, he said space, and science and technology will be its key features.
"And the most thrilling part is that students scoring the highest in their respective states will be invited to visit Sriharikota, with expenses borne by the government. There in September they will get an opportunity to witness the moment when Chandrayaan would be landing on the surface of the Moon. For these winners, it will be a historic event of their lives," he said.
The prime minister said 2019 has been a very fruitful year for India in the realm of space, noting that it had also launched A-Sat in March.
In the hectic engagements during the Lok Sabha election, the A-Sat launch could not be a prominent part of the discourse even though India has become the fourth country in the world to have capability of destroying a satellite three hundred kilometres away in mere three minutes, he said.

Speaker disqualifies 14 rebel MLAs; Yediyurappa says will win trust vote

Karnataka Assembly speaker K R Ramesh Kumar on Sunday disqualified 14 more rebel MLAs under the anti-defection law till the end of the assembly term in 2023, a day ahead of Chief Minister B S Yediyurappa seeking the trust vote in the assembly to prove his majority.
Eleven Congress MLAs and three JDS lawmakers faced the axe from the speaker, who pronounced his ruling at a hurriedly called news conference, two days after Yediyurappa took the oath as chief minister after the collapse of the Congress-JDS coalition government.

The Speaker's action would have no bearing on the fate of the Yediyurappa government, as with disqualification of the errant MLAs with immediate effect, their absence would reduce the effective strength of the House, making it a smooth affair for the BJP.
A day ahead of seeking the trust vote in the Karnataka assembly, Chief Minister B S Yediyurappa on Sunday expressed confidence about proving the majority.
He also said that the finance bill prepared by the previous Congress-JD(S) government would be tabled by him in the assembly on Monday, without any changes.
"On Monday hundred per cent I will prove the majority," Yediyurappa told reporters here.
The finance bill (appropriation bill) needs to be passed "urgently", as otherwise "we will not be able to draw funds even to pay salaries," he said.
"So tomorrow after moving the confidence motion,we will first take up the finance bill. I have not even changed a comma or full stop in it. I will be tabling the finance bill prepared by the (previous) Congress-JD(S) government," he added.
The absence of 20 MLAS--17 rebels, also one each legislator from Congress, BSP and Independent--during the vote of confidence motion moved by the Congress-JDS coalition government headed by H D Kumaraswamy had led to its downfall after weeks of drama marked by murky political intrigues and court battle.
With the disqualification of 17 rebel MLAs --14 from the Congress and three from JDS -- on Sunday, the effective strength of the 224-member assembly excluding the Speaker, who has a casting vote in case of a tie, is 207. The magic figure required will be 104.
BJP along with the support of one independent has 106 members, Congress 66 (including nominated), JD(S) 34 and one BSP member, who has been expelled by the party for not voting for the Kumaraswamy government during the trust vote.
"I have used my judicial conscience... I am 100 per cent hurt" said the Speaker, when asked about his controversial decision on disqualification being called into question and allegations about his conduct in the entire issue.

China hits back after Trump's outburst against 'developing nation' tag

China said the classification of a country as a “developing nation” shouldn’t be defined by the interests of the US, after President Donald Trump ordered his top trade negotiator to pressure the World Trade Organization to crack down on some economies that declared themselves as such.
The reform of the WTO should not be gripped by a few “hegemony countries,” the state-run People’s Daily said in an editorial on Sunday.

On Friday, Trump singled out China in a memo to US Trade Representative Robert Lighthizer that gave the latter 90 days to determine whether there’s been “substantial progress” toward limiting the number of countries considered developing nations. The US may act unilaterally if not, Trump said.
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The 90-day deadline to see if the WTO has made improvements in the matter lays bare the “arrogance and impudence” of the US, according to the People’s Daily editorial.
China hasn’t abused the special treatment accorded to it as a developing nation, the paper said.

FM Sitharaman rules out rethinking on overseas sovereign bonds: report

Finance Minister Nirmala Sitharaman has ruled out reconsidering a plan to issue foreign currency overseas sovereign bonds, she was quoted as saying in an interview published on Sunday, despite warnings of long-term risk for the economy.
On Thursday, Reuters reported that the Prime Minister's Office (PMO) wanted the finance ministry to reassess the idea of issuing foreign currency overseas sovereign bonds and seek wider consultation.

"I am not doing any review. I have not been asked by anybody to do a review," Sitharaman told the Economic Times.
This month, Sitharaman, presenting the budget for the fiscal year 2019/2020 that began on April 1, said India would look to issue overseas foreign currency sovereign bonds in addition to raising funds from the domestic market.
The proposal has been criticised by former heads of the Reserve Bank of India, economists and allies of the ruling Bharatiya Janata Party, who argue it could create long-term economic risks by exposing the government's liabilities to currency fluctuations.
"The government would start raising a part of its gross borrowing programme in external markets in external currencies. This will also have a beneficial impact on the demand situation for government securities in domestic market," Sitharaman told the Economic Times.
The government plans to borrow nearly $10 billion from the foreign overseas market, out of total planned borrowing of about $103 billion in 2019/20.
Sitharaman told the newspaper that details such as timing of the issue and the exact size had not been worked out.

Ola puts electric plan in top gear, rejigs management to bolster project

Freshly-crowned unicorn Ola Electric Mobility has been on an overdrive to bolster its team to take its electric vehicle and solutions initiative forward.
The company, according to sources, is diverting a part of its manpower from teams which mainly manage Foodpanda and Ola Play.

Some of the mid to senior level managers, executives, vice-presidents and engineers have been shifted to the Ola Electric team over the last few weeks.
The drive has gained further momentum after it managed to again get back into SoftBank Group’s good books and got a massive $250 million cheque from the Masayoshi Son-led global conglomerate. Some of the people who have been recently moved to Ola Electric include Ankit Jain, who was vice-president and head of Ola Play. He has now been appointed co-founder of Ola Electric Mobility. The company, according to sources, is now completely focusing its manpower and resources on electric and the rest is, for the time being, taking a back seat. Ola did not respond to a detailed questionnaire sent on the issue.
“Over the last few weeks, some senior management teams have been asked to move to the Electric department. We have been told that the reshuffle would continue for some more time,” said a senior manager in the company who has now been shifted to Ola Electric.
Sources said the company is on a tight deadline to roll out its electric initiatives. Internally, the company has given a three-year timeline to roll out the first set mass produced electric vehicles as well as related infrastructure in association with original equipment manufacturers (OEMs). According to sources in the know and going by the hiring plan for its Palo Alto-based ‘Advanced Technology Center’ in the US, the company intends to design and build electric mobility solutions as well as related accessories. The plan is to collaborate with the OEMs and new-age EV makers.
The cab aggregator is planning to give a headstart to its EV ambitions by hiring heads for its engineering and designing verticals, data scientists, and around 150 engineers for the US facility.
The brief given by chief executive officer (CEO) Bhavish Aggarwal and co-founder Ankit Bhati is to mainly design and develop ‘practical’ EV solutions for the firm, which can be rolled out in the next two to three years. This is, however, not the first time that the company has gone for an internal reshuffle. In fact, it is possibly the third HR shuffle in the space of a year. The ride-hailing unicorn had transferred a huge group of people from Ola to Foodpanda when Aggarwal’s focus switched to the food tech company it acquired in 2017.
However, after Ola changed its plans for Foodpanda, people were shifted back from the food delivery app to Ola. And during both shifts, there was significant attrition within the company.
From the head of human resources department to top bosses in the legal division, the list of exits is long. The names include chief operating officer (COO) Vishal Kaul, who left after a year and a half with the firm, chief people officer Susheel Balakrishnan, who stepped down within three months of joining, and marketing director for Australia and New Zealand Natasha Daly.
As many as nine senior leadership team members quit Ola in the last one year. Even Aggarwal’s chief of staff Akshay Alladi exited the firm in a little over a year. The company has also seen a series of exits of vice-presidents and product leaders, all in the last six months. In January, one of Aggarwal’s core group members Pallav Singh resigned as COO and quit from an active role in the company.

Alphabet, Starbucks earnings drive S&P 500 and Nasdaq to record highs

Robust earnings from Alphabet and Starbucks pushed the S&P 500 and Nasdaq indexes to record highs on Friday, with support from data showing U.S. economic growth slowed less than expected in the second quarter.
The US Commerce Department said GDP increased at an annualised rate of 2.1 per cent in the second quarter, higher than a 1.8 per cent rate forecast by economists polled by Reuters.

The GDP data further solidified wide expectations that the US Federal Reserve will cut interest rates at its policy meeting next week. Those expectations have powered a solid run in stocks this month, helping Wall Street scale record levels.
"This is just what the market needed, not so soft that the economy is slowing down precipitously and not so strong that the Fed is going to reverse course," said Art Hogan, chief market strategist at National Securities in New York. "It shows that the economy is slowing, but not nearly enough to raise any red flags."
The data comes on the heels of European Central Bank President Mario Draghi's speech on Monday, which was less dovish than investors had anticipated and led the S&P 500 to post its first loss in the week.
Two weeks into the second-quarter earnings season, about 75 per cent of the 218 S&P 500 companies that have reported so far have topped profit estimates, according to Refinitiv data.
Starbucks rallied 8.9% to a record high after the world's largest coffee chain posted its biggest same-store sales growth in three years.
Alphabet Inc surged 9.6% after beating Wall Street targets on higher ad sales and growth at its cloud unit, a high-margin business it is leaning more on to drive expansion.
Twitter Inc rose 8.9% after it posted better-than-expected quarterly revenue and an uptick in daily users who see advertisements on the site.
Their upbeat earnings pushed the S&P 500 communication services index up 3.25 per cent, the most among S&P sectors.
Lead negotiators for China and the United States are set to meet in Shanghai on Tuesday for two days in the next round of talks aimed at settling the U.S.-China trade war. The results of those talks will affect sentiment on Wall Street.
"Going forward, it's very important not to have a breakdown in trade talks. And earnings reports need to continue to come in as they have been - a little better than expectations," said Tom Martin, a senior portfolio manager at GlobAlt Investments in Atlanta.
The Dow Jones Industrial Average rose 0.19 per cent to end the week at 27,192.45 points, while the S&P 500 gained 0.74 per cent to 3,025.86. The Nasdaq Composite added 1.11 per cent to 8,330.21.
For the week, the S&P 500 added 1.7 per cent, the Nasdaq climbed 2.3 per cent and the Dow rose 0.1%.
Even under the cloud of uncertainty related to trade conflict, the S&P 500 has risen 21% so far in 2019.
Also on Friday, McDonald's Corp jumped as much as 2.1%, briefly hitting a record high after beating quarterly sales expectations at established U.S. restaurants.
Amazon.com Inc fell 1.6% and was the biggest drag on the benchmark S&P 500 after the online retailer reported its first profit miss in two years and said income would slump in the current quarter.
Intel Corp lost 1.1%, even after the chipmaker gave an upbeat current-quarter forecast and raised its full-year revenue guidance.
Advancing issues outnumbered declining ones on the NYSE by a 2.04-to-1 ratio; on Nasdaq, a 2.34-to-1 ratio favoured advancers.
The S&P 500 posted 41 new 52-week highs and two new lows; the Nasdaq Composite recorded 111 new highs and 79 new lows.
Volume on US exchanges was 5.9 billion shares, compared with the 6.3 billion-share average for the full session over the last 20 trading days.

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ICICI Bank back in the black in Q1 with net profit of Rs 1,908 crore

Private sector lender ICICI Bank on Saturday reported a net profit of Rs 1,908.03 crore for the April-June quarter (Q1FY20), aided by good interest income and lower provisioning, against a loss of Rs 120 crore in the year-ago quarter. Analysts were expecting a profit of little more than Rs 2,000 crore for the first quarter.
The bank, however, showed improvement in asset quality, as its gross non-performing assets (NPA) ratio fell -- both year-on-year and sequentially -- and the gross additions to NPAs were lower than the year-ago quarter.

The gross NPA ratio was 6.49 per cent for the June quarter, compared to 8.81 per cent in the year-ago period and 6.70 per cent in the March quarter.
The net NPA ratio decreased to 1.77 per cent at the end of June 30 this year, which is the “lowest in 14 quarters”, said the bank’s executive director, Sandeep Batra, in a conference call with the media. In the year-ago quarter, the net NPA ratio was 4.19 per cent.
The bank’s management did not offer any guidance on slippages, or even credit and deposit growth, but said rather than chasing a growth target, the bank would be focusing on choosing customers that pass through their “filters”.
“As of now, we are stable (in terms of asset quality). We have our risk filters which are pretty tight. We continue to recalibrate the segments that we are not comfortable with. Whatever we are writing, we are quite comfortable with that,” said Batra.
“We are not targeting a number, but as long as the customer passes the risk filter, we are happy to grow our loan book,” said Rakesh Jha, group CFO.
ICICI Bank back in the black in Q1 with net profit of Rs 1,908 crore “We do expect a credit cost within tolerable level and our overall outlook on credit cost is stable. We continue to monitor these credit qualities across our portfolios,” Jha said.
The bank’s net interest income (NII) increased by 27 per cent year-on-year to Rs 7,737 crore in the first quarter. NII in the current quarter includes Rs 184 crore of interest on income-tax refund, compared to Rs 8 crore in the year-ago quarter, and Rs 414 crore in the March quarter, the bank said in a statement.
Core operating profit (profit before provisions and tax, excluding treasury income) increased by 21 per cent year-on-year to Rs 6,110 crore from Rs 5,042 crore a year ago.
Net interest margin, or the difference between the yields on advances and cost of deposits, was 3.61 per cent compared to 3.19 per cent in the year-ago quarter and 3.72 per cent in the March quarter. Non-interest income, excluding treasury income, was Rs 3,247 crore compared to Rs 3,085 crore in Q1FY19. Also, fee income grew 10 per cent to Rs 3,039 crore.
“Retail fees constituted 72 per cent of total fees,” the bank said. Treasury income in the quarter was Rs 179 crore compared to Rs 766 crore in the year-ago period. However, last year’s treasury income included a gain of Rs 1,110 crore on sale of shareholding in ICICI Prudential Life Insurance.
Provisions for the quarter were Rs 3,496 crore compared to Rs 5,971 crore in the year-ago period.
The bank’s domestic loan book grew 18 per cent year-on-year, while total loan growth was 15 per cent. The CASA ratio was 45.2 per cent as of June 30, 2019, compared to 49.6 per cent on March 31, 2019, and 50.5 per cent on June 30, 2018.
Recoveries and upgrades of non-performing loans were Rs 931 crore in the first quarter. “At June 30, 2019, the fund-based and non-fund based outstanding to borrowers rated BB and below (excluding nonperforming assets) was Rs 15,355 crore ($2.2 billion) compared to Rs 24,629 crore ($3.6 billion) at June 30, 2018,” the bank said. These BB rated loans don’t necessarily mean they are due to slip into NPAs, the management clarified. “It doesn’t mean that the entire book will slip into NPA. Any bank, at any point, will have BB assets,” said Batra.
According to the management, the share of unsecured credit loans in the total loans is 8 per cent, and the BB-rated loans constitute 3.5 per cent of the total loans.
On a consolidated basis, profit after tax was Rs 2,514 crore in the first quarter, against Rs 1,170 crore in the fourth quarter and Rs 5 crore in the year-ago quarter. The bank said it was not planning to raise any capital, and that it was well capitalised.
The bank said it would continue to lend to good quality. The bank did not buy much securitised assets from NBFCs in the June quarter, and will buy those assets only if the retail loans pass the bank’s set ‘criter