Slowdown blues: India's core sector output contracts 1.5% in November

The output of eight core sectors of the economy fell for a third straight month in November, contracting by 1.5 per cent as key sectors like refinery products and electricity continued to see slow growth or contraction.
Output had crashed by a record 5.8 per cent and 5.2 per cent over the preceding two months as a broad-based decline gripped most sectors. As a result, the core sectors saw nil cumulative growth till November in the current fiscal year (FY20), down from 5.1 per cent in the previous year.
Economists warned that the latest figures indicated that the industrial slowdown would take time to recede. The above 5 per cent contractions had been unprecedented in the index's history, on either the FY12 or FY05 bases of calculating the data. “This is first instance of eight core infrastructure industries production contracting in three consecutive months in FY12 base. Most disappointing has been the contraction of electricity output in four consecutive months, which is a reflection of state of the economy,” said Devendra Pant, chief economist at India Ratings.
The data released by the commerce and industry ministry on Tuesday showed electricity generation shrank by 5.7 per cent in November, with the decline in generation widening from just 0.9 per cent in August to 12.2 per cent in October. Sluggishness in manufacturing is understood to have led to a steep fall in the power demand. According to the data from the Index of Industrial Production (IIP), the contraction in the manufacturing sector has continued unabated, standing at 2.1 per cent in October.
By extension, in November, coal production remained negative for a fifth straight month. But the rate of fall has sharply dropped from 20.5 per cent to 2.5 per cent in the latest month. Contraction in the sector continued to become entrenched since July, when a 24-month growth period ended.
In the energy space, crude oil production continued its downward spiral, having completed a continuous chain of contraction for the past 14 months.
Production reduced by 6 per cent, more than the 5.1 per cent contraction in October. Natural gas extraction continued to fall for an eighth straight month, reducing by a higher margin of 6.4 per cent in November.
Slowdown blues: India's core sector output contracts 1.5% in November
The latest data continued to cast uncertainty over infrastructure growth in the country as steel output reduced by 3.7 per cent in its third consecutive month of fall. It had reduced by 1.6 per cent in October, attributed to low performance of large steel consuming industries like auto and capital goods.
On the other hand, cement output returned to the growth charts in November after three months. Cement production rose 4.1 per cent following October’s 7.7 per cent fall, as construction projects picked up after the monsoon season.
This indicates signs of a return to growth, some experts say. “Though disappointing, the November figure has a silver lining in so far as there are certain sectors like cement and refinery products that have registered positive growth. There is, hence, a mixed picture when it comes to non-energy based industries which have performed relatively better,” said Madan Sabnavis, chief economist at CARE Ratings.
Refinery products rose by 3.1 per cent in November, picking up on October's marginal 0.4 per cent growth. While the sector has remained volatile in FY20, senior officials continue to claim that a solid recovery in production is underway as key refining units, which were closed earlier, have gone live.
The engulfing industrial slowdown continued to bypass fertilizer production which rose by 13.6 per cent in November, constituting the highest margin in over a year. This reflects both demand for rabi sowing as well as build up of inventory for the next season, Sabnavis said.
Slowdown blues: India's core sector output contracts 1.5% in November

Experts predicted hope for industrial production ahead. “With an improvement in the performance of a number of lead indicators, including the core sector industries, auto production and non-oil merchandise exports, we expect the IIP to report a modest growth in November 2019 after having contracted since September 2019,” Aditi Nayar, principal economist at ICRA, said.

Some airlines may have to shut due to predatory pricing: Hardeep Singh Puri

India’s civil aviation minister HardeepSingh Puri on Tuesday blamed predatory pricing by airlines for the sustained losses in the industry. However, he ruled out any regulatory intervention for now and said that airlines are regularly called and counselled whenever instances of predatory pricing are noticed.
Under current regulations, it is the prerogative of airlines to establish their process of determination of airfares. As such, the government does not interfere in their commercial affairs.

"We have noticed instances where airlines are pricing their tickets at a level which is lower than their operational cost. Such measures may benefit in the short term but in the longer term they hurt the entire industry," Puri said, citing the example of the popular Delhi-Mumbai sector in which he said price haven’t gone up in the last 10 years.
"The fare price in Delhi-Mumbai sector is similar to what it was 10 years back. That certainly isn’t rational pricing," Puri asserted.
SpiceJet owner Ajay Singh last month had raised a similar argument saying that competitive pressure forcing a low-fare regime will lead India's aviation sector to a bloodbath. Drawing a comparison with India’s telecom firms Singh said, "It is important that we learn lessons from telecom sector. We need to take steps urgently and stop selling tickets at prices that don't even cover operating costs."
India's telecom companies have been reeling under stress due to intense competition which has forced them to charge low tariffs. Adverse regulatory and judicial orders have only added to the sector's woes, with Bharti Airtel and Vodafone posting their largest losses ever. The industry expects Vodafone India to shut down due to its precarious financial state.
According to aviation consulting firm CAPA, Indian airlines are expected to lose over $600 million (Rs 4,273 crore) in FY 2019-20 as compared to a previous estimate of full-year profit of $500-700 million ( Rs 3,561-4,985 crore).
Two of the largest airlines in India, InterGlobe Aviation Limited-operated IndiGo and Ajay Singh-controlled SpiceJet, which are both listed on the BSE, reported huge losses during the September quarter. SpiceJet plunged to a consolidated loss of Rs 461.22 crore in the three months to September 30, from a year-ag0 net loss of Rs 382.72 crore. Meanwhile, IndiGo plunged to a wider-than-expected quarterly loss during the September quarter with higher maintenance and overhaul costs outweighing the increase in passenger traffic. The country's largest domestic airline posted a loss of Rs 1,062 crore in the September quarter (Q2) compared with a loss of Rs 652 crore a year ago.
However, Puri said that as of now the government is not looking for any regulatory intervention to stop the practice of predatory pricing. “Whatever has to happen, it has to be driven by market forces and the industry,” Puri said when asked if the government is planning to fix a minimum floor price for airline tickets. The minimum floor price is a regulatory threshold under which airline can’t price their tickets. “I have set up a fare-monitoring cell within the DGCA. We regularly call airline executives and advise them whenever we notice such instances. This has to happen within parameters of deregulation,” he said.

Jet fuel price hiked by 2.6%, cost of non-subsidised LPG goes up by Rs 19

Jetfuel or ATF price was on Wednesday hiked by 2.6 per cent and that of non-subsidised cooking gas LPG by Rs 19 per cylinder on the back of a rise in international rates. Price of Aviation Turbine Fuel (ATF), used to power aeroplanes, was raised by Rs 1,637.25 per kilolitre, or 2.6 per cent, to Rs 64,323.76 per kl in Delhi, according to a price notification of state-owned fuel retailers.
This is the second straight monthly increase in rates warranted due to firming up of prices in the international market.

In India, which is dependent on imports to meet 84 per cent of its oil needs, prices of domestic fuels are at par with benchmark international prices. ATF price was on December 1 increased by a marginal Rs 13.88 per kl.
The two back-to-back increases have push jet fuel prices to their highest since June 2019. The hike will add to the burden of cash strapped airlines that are already reeling under pressure from cut-throat competition in the sector.
Despite the increase, at Rs 64.32 per litre ATF costs less than petrol and diesel. A litre of petrol in the national capital comes for Rs 75.14 while diesel is priced at Rs 67.96 a litre. Simultaneously, oil companies also raised the price of non-subsidised LPG to Rs 714 per 14.2-kg cylinder from Rs 695 previously.
This is the fifth straight monthly increase in cooking gas prices since September 2019. In all, non-subsidised cooking gas prices have gone up by Rs 139.50 per cylinder in the last five months.
Non-subsidised LPG is the gas that consumers buy after exhausting their quota of 12 cylinders of 14.2-kg at sub-market or subsidised rates of Rs 495.86.
LPG, as well as ATF prices, are revised on 1st of every month based on the average international rate for benchmark fuel and foreign exchange rate in the preceding month.
Also, the price of kerosene sold through the public distribution system (PDS) was increased by 26 paise to Rs 35.58 per litre in Mumbai.
This is in accordance with the 2016 decision to raise rates by 25 paise a litre every month till subsidy on the fuel is eliminated. Delhi has been declared kerosene-free and no PDS kerosene is sold in the national capital.

SBI to float $2-bn distressed asset fund; to bring in global partners

The country’s largest lender, State Bank of India (SBI), plans to float a distressed asset fund in the new year and will be roping in a global partner to raise money from international investors. Rajnish Kumar, chairman, SBI, told Business Standard: “We are expanding our fund management business.
At present, SBICAP Ventures, a fund management arm of the group, is managing a realty fund. It is looking at a distressed asset fund too.” SBICAP Ventures is creating capabilities to manage the fund, he said. The size of the distressed asset fund is expected to be ...

Maruti Suzuki records 2.4% y-o-y rise in car sales during December 2019

With total sales of 133,296 passenger vehicles, the country's leading carmaker MarutiSuzuki India has recorded 2.4 per cent year-on-year rise in car sales in the domestic market during December, as higher demand for compact models such as New WagonR offset a slump in small cars.
In a regulatory filing, Maruti said it sold 124,375 vehicles in the domestic market in December as compared to 121,479 vehicles sold in the same month a year back.

After including exports and sales to other original equipment manufacturer (OEM), the firm clocked a 3.9 per cent rise in sales to 133,296 vehicles.
Its popular models such as Alto, which are categorised by the company as 'mini' cars, saw sales drop 13.6 per cent to 23,883 pieces.
This was more than offset by a near 28 pe cent rise in its 'Compact' category cars such as New WagonR, Swift, Celerio and Dzire to 65,673.
Mid-sized Ciaz saw a 62.3 per cent drop in sales to 1,786 while utility vehicles such as Gypsy and Ertiga posted a 17.7 per cent rise to 23,808.
During April-December, Maruti said its domestic sales were down near 17 per cent at 1.1 million units.
release

SMS returns to mobile phones, internet returns to govt hospitals in Kashmir

Broadbandinternet service was restored in government-run hospitals and SMS facility on all mobile phones from Tuesday midnight in Kashmir, after over four-and-a-half months of suspension.
Internet services, landline and mobile phones were snapped across Jammu and Kashmir on August 4, a day before the Centre's announcement to scrap the special status of Jammu and Kashmir and divide it into two union territories.

Though most services, except mobile internet, were restored in Jammu within a week, Kashmir saw landlines and post-paid services being restored in phases.
"It has been decided to restore internet connectivity to all government hospitals with effect from midnight of December 31 besides fully restoring SMS on mobile phones," Jammu and Kashmir administration spokesman Rohit Kansal told reporters here.
However, Internet and pre-paid mobile services in Kashmir are yet to be restored.
On December 10, he had said machine-based SMSes were enabled for mobile phones in Kashmir in order to facilitate students, scholarship aspirants, traders and others, and that restoration of full message services was part of the process.
"Continuous efforts of the government have been to facilitate and move forward as much as possible and as quickly as possible, and ever since August 5, we have been progressing in this direction both in Jammu and in Kashmir. We have been moving progressively forward and we will try to ensure as much and as quickly as possible," Kansal said in response to a question about restoration of Internet services.
He said that "our direction has been progressive, positive, and movement forward".
ALSO READ: Kashmir sees over $2.4 billion losses since Article 370 was amended
"We have been trying to take all possible steps slowly, surely but firmly in the form of restoration. These steps will continue," said Kansal, who is also principal secretary for planning, development and monitoring in the Union Territory administration of Jammu and Kashmir.
On August 5, the Centre had abrogated Article 370 provisions that gave special status to J-K and bifurcated the erstwhile state into UTs of Jammu and Kashmir, and Ladakh.
Kansal said the administration in Kashmir is facilitating students, contractors, tour operators, government officials through various internet touch points.
"Nearly 900 such touch points and special counters are functional throughout Kashmir in districts, prominent tourist places and hotels, and about 6 lakh people have taken advantage of these touch points," the spokesman said.
In response to a question on release of detained politicians, including three former chief ministers, Kansal said that "any release or detention, preventive or otherwise, is a decision that is being taken by local law enforcing agencies based on its assessment of the local law and order situation".
ALSO READ: Rehearsed in Kashmir, played out in rest of India
"The same is being continuously reviewed. Some people were released yesterday, it is again a local assessment and review of the situation," he said.
Five political leaders, who had been under preventive detention since August 5, were released from the MLA hostel in Srinagar on Monday. Former chief ministers Farooq Abdullah, Omar Abdullah and Mehbooba Mufti are still under detention.
Asked about the reasons for putting Congress leaders under house arrest in Jammu, Kansal said he does not have any information, but whenever local law enforcing agencies feel such a need based on their assessment of the situation, they carry out action accordingly.
He said despite repeated attempts by anti-national and anti-social elements, over 19 lakh metric tons of apple was exported.
In September, the government had introduced a market intervention scheme for procurement of apples, Kansal said.
"This was when there was considerable concern and apprehension about the harvest procurement and transportation of apples, and when there was a concerted effort by anti-social and anti-national elements to attack everybody associated with the apple trade, to burn trucks as well as the harvested crop," he said.
Over 19 lakh metric tons of bumper harvest already stands exported and market intervention scheme stands extended to March 2020, the spokesman said.
"Efforts of anti-national elements to harm the economy and livelihood of people have been thwarted," he said.
On demands from various quarters on reservation for educated local youths in government jobs, Kansal said, "there have been various suggestions that have been received by the government and these are under examination".
He denied any discrimination in distribution of compensation to farmers affected by unprecedented snowfall and rains in the regions of Jammu and Kashmir, and said "this government is absolutely fair, impartial and people friendly."
The people will be given their rights in accordance to the rules, Kansal said.

India's fiscal deficit rises to 115% of target in 8 months of FY20

Fiscal deficit of the Uniongovernment rose to 114.8 per cent of the target in the first eight months of the fiscal year, the data released by the Controller General of Accounts showed.
The gap between the government’s revenue and spending stood at Rs 8.07 trillion at the end of November — Rs 1 trillion (13 per cent) more than the full-year target.

A persistent contraction in gross tax revenue, with expenditure growing consistently, has put pressure on government finances, resulting in a larger deficit well before the end of the fiscal year.
While the corporation tax collection contracted 1 per cent in April–November on the revenue side, budgetary capital spending on roads took the worst hit on the expenditure side. Income support to farmers and food subsidy bills have taken a graver hit in terms of revenue expenditure.
Non-tax revenue, especially in the form of dividend from public enterprises (including public sector banks), lower devolution to states owing to higher devolution in previous year, probable revenues from telecom company dues, and a slice of cash from the legacy service tax and excise disputes scheme, could help the government restrict fiscal slippage.
The situation was similar last year, with a 15 per cent overture in the first eight months of FY19. In FY17, fiscal deficit stood at a comfortable 86 per cent of the target.
The government would need to prune spending or depend upon funds to remain unspent with ministries to save on the expenditure side, and retain fiscal deficit to the budgeted Rs 7.04 trillion.
This target was projected to be 3.3 per cent of India’s gross domestic product (GDP), assuming that the GDP would grow 11 per cent in FY20, to nearly Rs 210-211 trillion.
However, after taking into account the nominal GDP estimate assumed in the National Infrastructure Pipeline (NIP), which the government released on Tuesday, fiscal deficit would touch 3.45 per cent of GDP, even if it is restricted to the budgeted Rs 7.04 trillion.
The NIP report assumes that India’s nominal GDP would beRs 205.3 trillion in FY20, growing at 8 per cent, substantially lower than the Budget expectation.
Experts said that capital spending has taken a bigger hit from subdued revenues, and asserted that the probability of deficit being higher than targeted has only risen.
Aditi Nayar, principal economist at ICRA, said concerns on the extent of fiscal slippage still persist.
“Given the likely shortfall in tax collections and lack of clarity on revenue from telecom license holders and disinvestment, expenditure cuts may have to be undertaken to prevent fiscal deficit from rising too sharply,” she said.
While gross tax revenue contracted 2.6 per cent in November, revenue spending rose 7 per cent.
India's fiscal deficit rises to 115% of target in 8 months of FY20
As a result, productive capital spending contracted 12 per cent. ICRA said that this is a “discomfiting trend”. In April-November, gross tax revenue grew by a paltry 0.8 per cent.
Some experts highlighted that the divestment of Bharat Petroleum is crucial for the fiscal balance this year.
“Attaining the disinvestment target of Rs 1.05 trillion will remain a challenge as there is uncertainty in the completion of the BPCL stake sale before the current fiscal year. Given the challenges on the revenue front, fiscal deficit would be in the range of 3.8 to 4 per cent of GDP,” said Madan Sabnavis, chief economist at CARE Ratings.

After a tough year, fund managers bet on mid- and small-caps for 2020

Mid and small-cap stocks, which had a difficult last year, can get their mojo back in 2020, say domestic fund managers. They expect the stocksof smaller-sized companies to start staging a strong recovery after the economy starts to respond to the government’s efforts to revive growth.
"Mid- and small-cap stocks can be attractive investment opportunities for the next year, following the lack of broader market participation for the last two years. Valuations have slid to reasonable levels, limiting further downside," says Anoop Bhaskar, head of equity at IDFC Mutual Fund (MF).
"Divergence between the Nifty and mid- and small-caps has been close to historical extremes. While it is difficult to spot the bottom, historically, broader markets tend to outperform for 18-24 months after such extremes are reached," says Pankaj Tibrewal, equity portfolio manager at Kotak MF.
In 2019, the BSE MidCap had slipped 15 per cent before the corporate tax cut in September led to market recovery. The BSE SmallCap had corrected more than 17 per cent during the same period. In 2018, the BSE MidCap had corrected 13.4 per cent, while the BSE SmallCap had corrected 24 per cent.
Whenever the price-to-earnings (P/E) valuation of small-caps has gone down to 40-45 per cent of the Nifty, there tends to be a bottoming out, say fund managers. The Nifty is currently trading at around 14.5 times its one-year forward P/E multiple.
After a tough year, fund managers bet on mid- and small-caps for 2020
Also, the share of market cap of the Nifty SmallCap is currently 5.3 per cent of the market cap of the Nifty, which is close to its lowest levels seen in six years.
"At close to these levels in the past, we have seen a bottoming out of mid- and small-cap stocks," says Bhaskar.
Amid weak sentiment, even quality mid- and small-cap stocks have come under heavy selling pressure, say market experts.

"Good quality stocks in this segment had to face collateral damage because they happened to be in this segment. Such stocks offer strong opportunities for next year," says Ambareesh Baliga, independent capital markets professional.
Further, higher liquidity in the banking system can help smaller companies, which tend to suffer when interest rates are on the higher side.
"There is enough liquidity in the overall banking system. This should lead to transmission of credit to the economy," says Tibrewal.
"These companies often find it difficult to convert their earnings before interest, tax, depreciation, and amortisation into profit before tax when interest costs are higher," adds Bhaskar. However, foreign investors are still circumspect of a strong broader market rally
"Narrow market performance should continue at least till mid-year as uncertainty stays high, but we must start reducing concentration risk," Credit Suisse said in a recent note.
Brokerages say that going ahead, revival of domestic economy will be crucial and on the global front, the trading relationship between the US and China will be a key factor to watch out for.

Govt shouldn't allow Huawei for trials of 5G, SJM tells Narendra Modi

Urging Prime Minister Narendra Modi to intervene, the RSS-affiliated Swadeshi Jagran Manch (SJM) said that Huaweishould not be allocated airwaves for 5G network trials to ensure that India’s security interests are not compromised. In a letter to Modi, the outfit claimed that there are evidences that lead to suspicion of Chinese firms indulging in exfiltrating sensitive information from, devices and equipment that it exports. SJM’s co-convener Ashwani Mahajan said the organisation has made representations to the DoT cautioning and alerting it of “various threats Huawei brings in”.

MARKET LIVE: Sensex rises 150 pts; Sterling and Wilson Solar gains 3%

Indian markets started the first trading session of the calendar year 2020 on a positive note with benchmark indices adding 0.3 per cent each.
The S&P BSE Sensexwas trading at 41,396.45 level, up 0.36 per cent. Reliance Industries (up 0.85 per cent) and Bharti Airtel (0.75 per cent) were the top gainers on the 30-stock index, while NTPC and Bajaj Auto were trading as the top laggards.
On the NSE, the Nifty50 was testing 12,200-mark at 12,212.20, up 0.35 per cent.
Sectorally, all the indices were trading in the green on the NSE. Nifty PSU Bank and Realty indices gained the most in the early trade, up 0.6 per cent each.
The broader markets, too, were trading in line with the headline indices. Both, the S&P BSE mid and small-cap indices were trading 0.36 per cent higher.
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Infra stocks: Finance Minister Nirmala Sitharaman on Tuesday launched a National Infrastructure Pipeline (NIP), unveiling projects worth Rs 102 trillion, to boost economic growth and help the economy reach the $5-trillion target by 2024-25.

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FM Sitharaman unveils Rs 102-trillion infrastructure plan to boost growth

Finance Minister NirmalaSitharaman on Tuesday launched a National Infrastructure Pipeline (NIP), unveiling projects worth Rs 102 trillion, to boost economic growth and help the economy reach the $5-trillion target by 2024-25.
The NIP has identified projects across 23 sectors and 18 states and Union Territories, which will be funded over the next five years by the central and state governments as well as the private sector.
Addressing a press conference while launching the NIP report, Sitharaman said that of the proposed projects, 39 per cent each would be implemented by the Centre and states, and the rest 22 per cent by private players.
She said the government was expecting the private sector’s share to go up to 30 per cent by 2024-25, and added that some additional projects worth Rs 3 trillion would be identified in the coming weeks, taking the total commitment to Rs 105 trillion.
FM Sitharaman unveils Rs 102-trillion infrastructure plan to boost growth
The pipeline includes brownfield and greenfield projects by the Centre, states, the private sector, and state-owned companies, as well as those under the public-private partnership model. According to the data given in the report, some Rs 42.7 trillion (43 per cent) worth of projects are under implementation, Rs 32.7-trillion (about 33 per cent) projects are at a conceptualisation stage, and Rs 19.1-trillion (19 per cent) projects are under development.
The NIP follows a commitment by Prime Minister Narendra Modi in his Independence Day speech, that more than Rs 100 trillion would be invested in infrastructure over the next five years.
A task force led by Economic Affairs Secretary Atanu Chakraborty identified the Rs 102 trillion worth of projects after conducting 70 stakeholder consultations in a short period of four months, Sitharaman said. The first meeting of the task force was held in September 2019. Subsequently, several meetings were held with various central and state departments and corporates engaged in infrastructure development.

FM Sitharaman unveils Rs 102-trillion infrastructure plan to boost growth
Chakraborty said the investment on infrastructure by the Centre, states and the private sector combined was 0.8 per cent of gross domestic product (GDP) currently, and the government expected to improve that to 1.1 per cent by 2024-25.
The sectors identified include traditional power and renewable power, railways, roads, urban development, irrigation, aviation, education, and health. The lion’s share of the funding is expected to go to the energy sector. Nearly Rs 24 trillion in energy projects have been lined up, while projects worth Rs 20 trillion in roads and Rs 14 trillion in railways have been planned. These sectors will form the bulk of infrastructure investment under the NIP, Sitharaman said.
The finance minister admitted concerns regarding financing of these projects, given the current economic slowdown. However, the government believes, and the NIP report states, that India’s GDP growth was expected to gradually swing upwards over the next five years, starting fiscal 2020, following on the clean-up of financial sector balance sheets, corporates starting to leverage for funding capital expenditure, and payoff from various government policies. Sitharaman said the government would look at deepening the debt market and alternative investment funds, which would provide the bulk of the debt financing necessary for this. She said the first edition of the Annual Global Investors' Meet on Infrastructure would be held in the second half of the coming year.

Govt cuts expenditure limit for March quarter as revenue collection falls

Faced with a shortfall in revenue collection, the government has initiated austerity measures by revising downwards the expenditure limit for January-Marchperiod of the ongoing financial year.
The government has asked all departments to restrict the expenses to 25 per cent of the Budget Estimate (BE) in January-March.
"Considering the fiscal position of the government in the current financial year, it has been decided to cap the expenditure in the last quarter and last month of the current financial year," an office memorandum issued recently by Budget division of the finance ministry said.
Expenditure in the March quarter is to be restricted to 25 per cent of the BE as against an earlier limit of 33 per cent, while expenditure in the last month should not exceed 10 per cent as compared to a 15 per cent limit earlier, it said.
During the first two months of the quarter, the expenditure should not exceed beyond 15 per cent from the existing criteria of 18 per cent of the BE, it said.
"In case of any expenditure through re-allocation of savings within the Grant requiring prior approval of Parliament, expenditure may be incurred only after obtaining the approval of Parliament through Supplementary Demands for Grants," it said.
Any additional expenditure may be incurred after having obtained the approval of Parliament, it added.
"Ministries and Departments are requested to observe the above guidelines strictly and regulate the expenditure accordingly in the current financial year," it said.
However, it has been clarified that items of large expenditure would continue to be governed by the guidelines issued previously.
The last revision in expenditure guidelines took place in 2017 when it was decided to restrict the expenditure to 33 per cent and 15 per cent in the last quarter and last month, respectively of the financial year.
Latest revision in expenditure cut comes at a time when there is pressure on meeting the fiscal deficit target of 3.3 per cent for the current fiscal.
The country's fiscal deficit hit 102.4 per cent of 2019-20 Budget Estimate at Rs 7.2 lakh crore at the end of October.
There is a widespread speculation that fiscal deficit target may be relaxed because of the lower-than-estimated tax collection and the subdued non-tax mop-up, especially disinvestment.
Gross direct tax collection increased by 5 per cent till November. The finance ministry has a 15 per cent growth in direct tax collection at Rs 13.80 lakh crore for the current fiscal.
With regard to indirect tax, Goods and Services Tax remains a matter of concern for various reasons.
The Central GST collection fell short of the Budget Estimate by nearly 40 per cent during April-November 2019-20, according to government data.
The actual CGST collection during April-November stood at Rs 3,28,365 crore, while the Budget Estimate is of Rs 5,26,000 crore for these months.

GST facelift: Electronic invoicing, new returns to be introduced in 2020

Two things that will change the way transactions are reported under the goods and services tax (GST) system in 2020 are electronic invoicing and new returns.
While both of these will be introduced mandatorily from April 1, e-invoicing would be implemented on a voluntary basis by those having an annual turnover of above Rs500 crore from January 1. Those with an annual turnover of over Rs100 crore can use e-invoicing from February 1. Finally, those with annual turnover of over Rs100 crore will have to use e-invoicing system from the beginning of the next financial year.
In the e-invoicing system, the invoices are authenticated electronically by GST Network (GSTN) for further use on the common GST portal. Two procedures are required in e-invoicing system — generation of invoices in standard format and reporting it on to a central portal system.
The new system requires invoice details to be uploaded on the government site — Invoice Registration Portal or IRP — on real-time basis. Based on the uploaded details, a unique invoice reference number (IRN) will be allocated against an each invoice. IRN would be get validated through IRN portal and GSTN.
According to GSTN Chief Executive Officer Prakash Kumar, e-invoices are generated by large number of businesses even today. However, they all use the format as provided by the ERP or billing software they use. Lack of a standard leads to a scenario where e-invoice generated on one billing software can’t be read by another, requiring manual data entry from electronically generated invoice. “All this means lots of engagement in maintenance of invoice, manual feeding in system, a pile of paper work, and lot of transcription errors,” he said. Here comes a system that does away with much of paper, human error, transcription error, saves time and gives you a format which is compatible to all. He said no changes are required as far as the businesses are concerned as they will continue to use the same software with same user interface to generate the e-invoices such as ERP, accounting and billing software, excel based billing system etc. The companies, which have developed the ERP or billing software, will have to make changes in their software codes to make them conform to the approved standards, he said.
Abhishek Rastogi, partner at Khaitan & Co, said the phased manner of implementation of e-invoicing will enable adequatetesting of the system before it is made mandatory. Harpreet Singh, partner at KPMG, said: “In the long run, e-invoicing should be the only data collection point for the tax authorities replacing e-waybills and multiple returns.”
However, new simplified returns would be implemented from April 1.
The GST Council had earlier decided to defer the implementation of these returns from the planned staggered manner from October this year.
In the new returns, there would be one main form — GST RET-1, which will contain details of all supplies made, input tax credit availed, and payment of taxes. This return will have two annexures — GST ANX-1 and GST ANX-2.
Form GST ANX-1 will have details of all outward supplies and form GST ANX-2 will contain details of all inward supplies. Currently, taxpayers are filing two returns: GSTR-1, which contains details of all outward supplies made, and GSTR-3B, which is a monthly self-declaration of outward supplies, input tax credit availed, and taxes paid.
Archit Gupta, CEO of ClearTax, said the e-invoice system would be integrated with the new return filing system for filing e-way bills and new return formats. Initially, businesses had a fear that their cash flow would be blocked because there was a proposition of only allowing credits to those invoices that were uploaded by vendors and tax discharged. To address the issue, the government had proposed allowing businesses to avail of input tax credit on the basis of self-declarations in GSTR-3B for initial months even under the new mechanism.
GST facelift: Electronic invoicing, new returns to be introduced in 2020

Gupta said the pain point involved in frequent matching of invoices was that the taxpayer had to allocate time from his daily business activities or he has to appoint personnel to do the same. There is also an issue of tracking and reporting of missing in

Karvy Group names Amitabh Chaturvedi as new head of financial services arm

India's KarvyGroup said on Tuesday it has appointed a new head of its financial services unit as part of corporate restructuring, a month after the country's market regulator slapped a ban on its stock broking arm for alleged misuse of client funds.
Karvy named Amitabh Chaturvedi as group chief executive officer of its financial services arm with a mandate to "completely overhaul the governance processes, ensure best practices and to bring in greater fiduciary discipline to these businesses," the Hyderabad-headquartered firm said in a statement.

The Securities and Exchange Board of India (SEBI) barred Karvy Stock Broking last month after a preliminary investigation by the National Stock Exchange showed the brokerage pledged and sold some of its client securities to raise funds for its own use, without client authorisation and in violation of new rules.
Karvy had then said that there was no "mis-utilisation" of client securities.
Karvy Group is in the process of restructuring its overall business into financial services and non-financial services verticals, it said on Tuesday.
The restructuring will see its stock broking, wealth management, commodities trading and investment banking businesses come under the ambit of financial services, while non-financial services will comprise of data management services, data analytics, market research and allied businesses.

Except Parliament, no state assembly has powers on citizenship laws: Prasad

Union Law Minister Ravi ShankarPrasad on Tuesday said the Parliament alone has got powers to pass any law regarding citizenship and not a state legislatures, "including Kerala assembly."
His assertion came hours after the Kerala Assembly passed a resolution seeking scrapping of the Citizenship (Amendment) Act, which provides Indian nationality to persecuted minorities from Pakistan, Afghanistan and Bangladesh.
"It is only the Parliament which has got the powers to pass any law with regard to citizenship; not any assembly, including Kerala Assembly," he told a press conference here.

Prasad said the CAA did not relate to Indian citizens and that it neither creates nor takes away citizenship.
Recalling that late Prime Ministers Indira Gandhi and Rajiv Gandhi had provided citizenship to minorities from Uganda and Sri Lankan Tamils, respectively, he wondered why was it ok if Congress did so and "it is a problem" when Prime Minister Narendra Modi or Home Minister Amit Shah did the same.
"This is double standards and hypocrisy of the worst order," he said strongly defending the CAA which has triggered protests across the country in the past weeks.
The CAA "does not relate to any Indian citizens.It neither creates citizenship nor takes away citizenship of Indians. It is only applicable to persecuted minorities (from the three countries)," the Minister added.
CAA was perfectly Constitutional and legal, he said, adding a 'disinformation campaign' was being done against it by vested interests.
On the National Population Register, which has also come in for opposition from several quarters, including Kerala government, he said it is a compendium of the usual residents of India and it has got nothing to with citizens.
It was about usual Indian residents in a village or town and it has got nothing to do with citizens.
The Population Register data is used for development and policy making purposes by both the Central and State governments, he said.

Retiring army chief Bipin Rawat to be India's first tri-service chief

Armychief, General Bipin Rawat, who was due to retire on Tuesday after serving three years as Chief of Army Staff (COAS), will now assume charge on Wednesday as India’s first Chief of Defence Staff (CDS).
On Monday evening, the day before Rawat’s retirement, the defence ministry announced: “Government has decided to appoint General Bipin Rawat as the Chief of Defence Staff (CDS) with effect from 31.12.2019 and until further orders and extension in service of Rawat.”
With Rawat elevated to the post of CDS, Lieutenant Gen Manoj Mukund Naravane will take over as COAS on Tuesday.
Last Tuesday, the government had approved the post of CDS “in the rank of a four-star general with salary and perquisites equivalent to a service chief”. On Saturday, the government had amended the Army Rules, 1954, allowing “extension of service to the Chief of Defence Staff... subject to maximum age of 65 years”.
In the normal course, Rawat was due to retire on March 31, upon reaching the age of 62 years. Saturday’s notification will allow him to serve as CDS for three years and three months, until he turns 65 in March 2023.
Having already completed three years as army chief, Rawat’s elevation to CDS for another three years will make him India’s longest-serving four-star commander, with the most opportunity to transform the military into a high-tech, modern force.
Over the past two years, Rawat has already initiated reforms within the army directed towards reducing manpower in order to save money for equipment modernisation. As CDS, his ambit will expand to include restructuring the army’s, navy’s and air force’s 17 single-service command headquarters into a smaller number of integrated, tri-service commands.

ALSO READ: Lt General Manoj Mukund Naravane to replace Bipin Rawat as Army chief
As CDS, Rawat will wear two hats: He will head the military hierarchy as “Permanent Chairman, Chiefs of Staff Committee” (PC-COSC). The COSC includes the chiefs of the three services — army, navy and air force. As permanent chairman, the CDS will be the first among this body of equals – primus inter pares.
Rawat’s second and more consequential role will be in the Ministry of Defence (MoD), where he will head the newly created department of military affairs (DMA), with the rank of a secretary.
The MoD already has five secretaries — heading the departments of defence (DoD), defence procurement (DDP), defence research and development (Defence R&D), ex-servicemen’s welfare (DESW) and defence finance (DDF). While the heads of each of these departments carries a secretary rank, the defence secretary, as head of the DoD, has traditionally been the primus inter pares.
Creating a DMA will require the MoD to restructure responsibilities within the ministry, transferring from the DoD to the DMA matters dealing with the army, navy, air force, territorial army and the integrated defence staff (IDS) headquarters.
The DMA will also be responsible for procurement from the revenue budget, while procurement from the capital budget remains under the DoD. However, the CDS would control inter-service prioritisation of procurement from his perch as PC-COSC.
Implementing these changes will require substantial modifications to the Allocation of Business Rules, says a senior retired MoD official.
While a mix of military officers and civil bureaucrats would probably man the DMA, it remains unclear whether military officers would also be inducted into the DoD to imbue it with greater military expertise.
The government has stated the “CDS will not exercise any military command, including over the three service chiefs”, but a former defence secretary believes that, the DMA oversight and control of the military’s promotions, postings and foreign assignments and travel, will give the CDS – as secretary of DMA – enormous clout over the military.
The CDS will also have a significant role in higher defence planning and operational aspects of India’s nuclear arsenal.
“CDS will be member of Defence Acquisition Council, chaired by RM, and Defence Planning Committee, chaired by National Security Advisor. [He will also] function as the Military Advisor to the Nuclear Command Authority,” stated the notification.

Ghosn flees to Lebanon, says won't be 'held hostage' by Japan's system

Ousted Nissan boss Carlos Ghosnconfirmed he fled to Lebanon, saying he wouldn't be "held hostage" by a "rigged" system, raising questions about how one of the world's most-recognised executives slipped out of Japan months before his trial.
Ghosn's abrupt departure marks the latest dramatic twist in a year-old saga that has shaken the global auto industry, jeopardised the alliance of Nissan Motor Co Ltd and top shareholder Renault SA and cast a harsh light on Japan's judicial system.

"I am now in Lebanon and will no longer be held hostage by a rigged Japanese justice system where guilt is presumed, discrimination is rampant, and basic human rights are denied," Ghosn, 65, said in a brief statement on Tuesday.
"I have not fled justice - I have escaped injustice and political persecution. I can now finally communicate freely with the media, and look forward to starting next week." Tokyo officials have previously said the system is not inhumane and that Ghosn has been treated like any other suspect.
It was unclear how Ghosn, who holds French, Brazilian and Lebanese citizenship, was able to orchestrate his departure from Japan, given that he had been under strict surveillance by authorities while out on bail and had surrendered his passports.
Ghosn arrived in Beirut on a private jet from Istanbul on Monday, people familiar with the matter told Reuters.
Immigration authorities had no record of Ghosn leaving the country, Japanese public broadcaster NHK said. A person resembling him entered Beirut international airport under a different name, NHK reported, citing an unidentified Lebanese security official.
'His lawyers were still in possession of his three passports, one of his lawyers, Junichiro Hironaka, told reporters.
Hironaka, in comments broadcast live on NHK, said the first he had heard of Ghosn's departure was on the news this morning and that he was surprised. He also said it was "inexcusable behaviour".
Japan has extradition treaties with only the United States and South Korea, according to the justice ministry, meaning it could be difficult to force Ghosn to return to stand trial.
While his arrest on financial misconduct charges last year ensured a dramatic fall from grace in Japan, he retains more popularity in Lebanon, where billboards saying "We are all Carlos Ghosn" were erected in his support and he was previously featured on a postage stamp.
Born in Brazil of Lebanese ancestry, Ghosn grew up in Beirut and has retained close ties to Lebanon.
A spokeswoman for the Lebanese embassy in Tokyo said "we did not receive any information" on the matter. Calls to the Brazilian embassy went unanswered. A French minister said she was "very surprised" by news of Ghosn's emergence in Lebanon.
Flight Risk
Ghosn was first arrested in Tokyo in November 2018, shortly after his private jet touched down at the airport. He faces four charges - which he denies - including hiding income and enriching himself through payments to dealerships in the Middle East.
Nissan sacked him as chairman saying internal investigations revealed misconduct ranging from understating his salary while he was its chief executive, and transferring $5 million of Nissan funds to an account in which he had an interest.
The case cast a harsh light on Japan's criminal justice system, which allows suspects to be detained for long periods and prohibits defence lawyers from being present during interrogations that can last eight hours a day.
Ghosn was initially released in March on a record $9 million bail only to be arrested on related charges weeks later and then released on bail again at the end of April.
His movement and communications have been monitored and restricted to prevent his fleeing the country and tampering with evidence, the Tokyo District court previously said.
The terms of his bail have also been striking by Western standards. He has been prevented from communicating with his wife, Carole, and had his use of the internet and other communications curtailed.
Carole is now with him in Lebanon at a house with armed guards outside, the New York Times reported, citing a person familiar with the matter.
House Arrest
Ghosn did not believe he would get a fair trial in Japan and was "tired of being an industrial political hostage", one person told The Wall Street Journal.
A person familiar with Nissan's thinking told Reuters: "I think he gave up fighting the prosecutors in court." The trial was widely expected to start in April. Ghosn's Japanese lawyers have fought, so far unsuccessfully, to get access to 6,000 pieces of evidence collected from Nissan, which they say is crucial to a fair trial.
Ghosn has said he is the victim of a boardroom coup, accusing former Nissan colleagues of "backstabbing" and describing them as selfish rivals bent on derailing closer ties between the Japanese automaker and its biggest shareholder Renault, of which Ghosn was also chairman.
His lawyers have asked the court to dismiss all charges, accusing prosecutors of colluding with government officials and Nissan executives to oust him to block any takeover by Renault.
Ghosn began his career in 1978 at tyre maker Michelin . In 1996, he moved to Renault where he oversaw a turnaround that won him the nickname "Le Cost Killer." After Renault sealed an alliance with Nissan in 1999, Ghosn used similar methods to revive the ailing brand, leading to business super-star status in Japan, blanket media coverage and even a manga comic book on his life.

Railways hikes passenger fares after five years, pass holders spared

After a span of five years, the Indian Railwayshave increased passenger fares by 1 to 4 paisa across various classes, excluding suburban and season tickets, with effect from January 1, 2020. The ‘marginal’ hike is expected to bring in another Rs 2,300 crore to the revenue of the cash-strapped national transporter.
For ordinary non-air conditioned (AC) classes, the fare increase will be 1 paisa per kilometre and in mail/express non-AC class, the hike will be 2 paisa per kilometre. On the other hand, for AC classes the fare hike will be 4 paisa per kilometre.
The hike will be applicable for only 34 per cent of the travelers on Indian tracks, while looking into the affordability concerns of daily commuters, the Railways restrained from hike for passengers over suburban sections and season ticket holders, which constitute 66 per cent of its total passengers.
This will be only a minor relief for the railways, that was staring at an operating ratio of 121 per cent for the first six months of the financial year, against 113 per cent during the same time in 2018-19. Operating ratio is the amount the Railways is spending to earn each rupee and hence lower the operating ratio, better the financial health of the national transporter is expected to be. For the current financial year, operating ratio was targeted at 95 per cent, as against 97.29 per cent achieved in 2018-19.
The last hike was in 2014, soon after the NDA government came to power, when the ministry was headed by Sadananda Gowda increased the passenger fares by 14.2 per cent in all classes. The current hike is coming at a time when the national transporter was bearing 73 paise in cost for every 10 kilo metre travel, while was charging only 36 paise to passengers.
“The additional revenue will be used to augment passenger experience through modernization of coaches and improved station infrastructure,” said a senior Railways official.
Investments to the tune of Rs 13.7 trillion is expected to improve the IR by FY 25, while a total of Rs 50 trillion may be infused to improve its infrastructure by 2030. In a notification, the Railways said the increase in fare will be on tickets bought on or after January 1, 2020 and no excess fare will be charged from passengers who have booked tickets before the date.
Even after the 2014 hikes, the Railways came with rationalization of rates across segments, that included schemes like flexi fare, similar to the aviation industry and cab-based applications. The flexi fare scheme, that is applicable in premium trains like Rajdhani, Shatabdi and Duronto Express trains was expected to add over Rs 500 crore to the revenue of the national transporter. Till April to December 2020, passenger earnings in reserved segment saw a rise of 6.21 per cent to Rs 27,469 crore compared to last year, while the number of passengers too saw a 5.07 per cent increase.
Tuesday's notification added that a similar hike will be applicable in trains like Rajdhani, Shatabdi, Duronto, Vande Bharat, Tejas, Humsafar, Mahamana, Gatimaan and other special trains. Last week, the Railway Board chairman V K Yadav had said that rationalization of passenger fares is being planned by the railways.

MARKET WRAP: Indices end last day of CY19 in the red, Sensex slips 304 pts

A weak trading sentiment across the globe, and concerns over infrastructure output data for November -- due later in the day -- pushed investors towards profit-booking on the last trading day of calendar year 2019. Information Technology (IT) stocks dragged indices lower on the back of a stronger rupee, coupled with decline in automobile counters. That apart, heavyweight private banking stocks, including ICICIBank and HDFC Bank, put pressure on the indices.
The S&P BSE Sensex settled at 41,253.74 level, down 304.26 points or 0.73 per cent, with 24 of the 30 constituents on the index settling in the negative territory. Tech Mahindra, Bajaj Auto, Reliance Industries, and Hero MotoCorp were the top losers today, while NTPC, ONGC, Sun Pharma, and Power Grid ended as the top gainers.
At close, the S&P BSE India Infrastructure index was up 0.8 per cent, after finance minister Nirmala Sitharaman announced plan to provide Rs 102 lakh crore infra-push over the next 5 years. KNR Constructions, IRB Developers, Gujarat Pipavav Ports, and PFC rallied up to 6 per cent. READ MORE
On the NSE, the broader Nifty50 index held the 12,150-mark to close at 12,168.45-level, down 87.4 points or 0.71 per cent. On the sectoral front, all the indices, barring Nifty Realty and Metal indices, slipped in the trade today. Nifty IT and Auto indices gave up 0.8 per cent each, while Nifty Realty index gained 0.7 per cent.
In the broader markets, the small-cap index outperformed the headline indices. The S&P BSE small-cap index ended 0.37 per cent higher at 13,699.37 level, as against a 0.03 per cent decline in the S&P BSE mid-cap index, which settled at 14,967.83.
MARKETS IN 2019
The year 2019 saw benchmark indices scale fresh lifetime highs amid volatility. Trade war concerns, tax proposals for India Inc and foreign portfolio investors (FPIs), the overall slowdown in the economy, rate cuts by the Reserve Bank of India were some of the key factors that guided markets through 2019.
The benchmark S&P BSE Sensex advanced 14.6 per cent in CY19, while the Nifty50 and Nifty Bank indices added 12.2 and 18.5 per cent, respectively. However, the BSE Midcap and SmallCap indices have slipped 3 per cent and 8 per cent, respectively, thus giving a negative return for the second year in a row.
GLOBAL CUES
In a shortened session ahead of the New Year’s Eve celebrations, the pan-European STOXX 600 index shed 0.3 per cent. French, British, and Spanish stocks lost between 0.4 per cent and 0.8 per cent, while Frankfurt and Milan bourses were shut for the year-end holidays.
Asian shares slipped on the last trading day of the decade.
Early in the Asian trading session, MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.39 per cent. Australian shares were 1.69 per cent lower and Hong Kong's Hang Seng dropped 0.32 per cent.
(With inputs from Reuters)
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03:47 PM
Sectoral trends at NSE at close
03:47 PM
Top gainers and losers on S&P BSE Sensex during at close
03:46 PM
Closing Bell
>> The S&P BSE Sensex settled at 41,253.74-level, down 304.26 points or 0.73 per cent, with 24 of the 30 constituents on the index settling in the negative territory
>> On the NSE, the broader Nifty50 index held the 12,150-mark to close at 12,168.45-level, down 87.4 points or 0.71 per cent.
03:30 PM
Infra stocks rally
03:27 PM
NEWS ALERT | Power, Railways, Irrigation, Urban Mobility some of the areas under infra pipeline: FM Sitharaman
03:25 PM
STOCK ALERT | Reliance Industries hits 6-week low
>> Stock down 7% from its record high level of Rs 1,618 on December 20, 2019
03:23 PM
NEWS ALERT | Govt will commit infra projects Rs 100 trillion over the next 5 yrs: FM
03:23 PM
NEWS ALERT | Intend to launch a National Infrastructure Pipeline: FM
>> To monitor the progress and link all stake holders
03:22 PM
NEWS ALERT | Task force has recommended infra projects worth Rs 102 trillion: FM Sitharaman
03:19 PM
NEWS ALERT | FM begins media address
03:09 PM
Buzzing | Bombay Dyeing gains over 6%
02:59 PM
Market check | Sudden decline in Sensex
02:53 PM
Buzzing | APL Apollo Tubes hits 52-week high in a weak market
02:51 PM
BSE500 stocks that hit 52-week high today
COMPANY PRICE(RS) 52 WK HIGH CHG(RS) CHG(%)
AAVAS FINANCIERS 1967.00 1978.00 43.65 2.27
ADANI GREEN 166.50 166.50 7.90 4.98
AMBER ENTERP. 1114.10 1145.90 -16.55 -1.46
APL APOLLO 1880.80 1884.80 43.15 2.35
CHALET HOTELS 358.20 395.00 3.05 0.86
» More on 52 Week High
02:41 PM
Year in Review | In uncertain times, 2019 an eventful year for bonds, rupee
The year 2019 was an interesting one where global, as well as domestic factors, exerted an equal pull to determine the value of the asset classes. Towards the end, the Indian central bank introduced a special open market operations (OMO) to bring down bond yields. But this was not the only new tool that the central bank brought out from its arsenal. READ MORE
02:23 PM
Nifty sectoral indices at this hour
02:14 PM
Global Markets check
European shares looked set to end the decade with a whimper on Tuesday as investors locked in gains after a record rally that was fueled by optimism around trade and easing fears of a global recession.
In a shortened session ahead of the New Year’s Eve celebrations, the pan-European STOXX 600 index shed 0.3 per cent. French, British, and Spanish stocks lost between 0.4 per cent and 0.8 per cent, while Frankfurt and Milan bourses were shut for the year-end holidays.
Asian shares slipped on the last trading day of the decade.
Early in the Asian trading session, MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.39 per cent. Australian shares were 1.69 per cent lower and Hong Kong's Hang Seng dropped 0.32 per cent.
(via Reuters)
02:04 PM
BSE Smallcap index up for 5th straight day; Bodal Chemicals gains 13%
Shares of smallcap companies were in limelight on Tuesday with the S&P BSE Smallcap index trading higher for the fifth straight session on the BSE. At 01:26 pm, the smallcap index, up 0.46 per cent at 13,710 points, was the largest gainer among broader indices. In past five trading days, the smallcap index outperformed the market by gaining 2.5 per cent on the back of a strong rally in beaten down sector stocks like chemicals, auto ancillaries, sugar, media and credit rating agencies. READ MORE
BSE, Bombay stock exchange, NSE, GROWTH, investment, investor, MF, stock, market
01:53 PM
BROKERAGE RADAR | MOFSL on Jubilant Foodworks
CMP: Rs 1,632 | TP: Rs 1,720,( 5% Upside) | Reco: Buy
Jubilant FoodWorks (JUBI) is one of India’s largest food service Company, with a network of 1,200 Domino’s Pizza restaurants across 271 cities (as of Dec 31, 2018). The Company also has exclusive rights for developing and operating Dunkin’ Donuts restaurants for India and has 32 Dunkin’ Donuts restaurants across 10 cities in India.
The challenge of a high SSSG base eases significantly going forward and JUBI has done well in the face of 20% SSSG base in recent quarters.
With demand stabilizing, discretionary players with strong brands offer high scope for upside, in our view.
We expect over 25% EPS CAGR and improving RoEs over FY20-FY22.
01:44 PM
Top technical picks for 2020 by MOFSL
01:39 PM
BROKERAGE RADAR | Reliance Securities on Mangalam Cement
Mangalam Cement (MGC) is likely to witness healthy traction ahead mainly on account of steady realisation in Northern region and cost synergies.
Notably, commissioning of 11MW WHRS in the last month and recent USA petcoke contract at US$70 (US$77/tonne average cost in 2Q) along with likely improvement in utilisation will lead to meaningful decline in opex in the subsequent quarters.
Further, improved fly-ash availability, new coal mining and improved biomass contribution are expected to aid it’s operating performance.
We forecast EBITDA/tonne at Rs707 and Rs696 for FY20E and FY21E, respectively.
We maintain our fundamental BUY recommendation on the stock with a Target Price of Rs 400.
01:38 PM
BROKERAGE RADAR | Emkay Global Financial Services on SBI Life
We believe SBIL is on the right track given the increased focus on improving product mix toward the high-margin protection segment and taking granular steps toward digitalization. Backed by high operational efficiency, it enjoys the lowest cost ratio of ~10--11% (as % of NEP) among its peers. We expect the company to clock 19.9% APE growth over the next three years, with non-par savings/protection growing 47.2%/42.8% over FY19-FY22E. VNB is expected to see 24.4% CAGR over FY19-FY22E. EV is expected to register 17.5% CAGR over the same period. We maintain Buy rating and OW stance in EAP with a revised TP of Rs 1,100 (earlier Rs 965) at 3.3x Sep’21E EV
01:35 PM
Rupee check
01:33 PM
Breakout year? Steel players hope for demand surge, better prices in 2020
After 2019 saw the domestic market grapple with surge in imports, increased dependence on imported coking coal from select countries, the steel ministry will be focusing on managing availability of iron ore as leases of a clutch of mines are scheduled to expire in March next year. READ MORE

01:29 PM
2019 review :: Rusmik Oza, Sr. VP (Head of Fundamental Research-PCG), Kotak Securities
>> The polarisation seen in CY18 continued in CY19 with only a handful of stocks contributing to the returns in Nifty-50.
>> We expect the divide between Indian equities and economy to continue in CY20 because there may not be a quick recovery in the economy but market may do relatively better on account of strong earnings and favourable tax changes.
>> For 2020, we see valuations attractive in sectors like capital goods, utilities, oil & gas, construction, metals & mining and auto ancillaries.
01:17 PM
Top losers on BSE at this hour
01:07 PM
NEWS ALERT | Govt to invite EoI for Air India in a few weeks: Hardeep Singh Puri
>> Got lot of interest from private players
>> Want an Indian airline to acquire Air India for Strategic reasons
>> Govt reluctant to infuse more funds in AI
>> Next meeting on Alternative Mechanism for AI in few weeks
(As reported by CNBC TV18)
01:03 PM
Pre-budget meet: IT industry seeks 15% corp tax for services cos in SEZs
"What we have suggested is that given that they have reduced the manufacturing corporate tax rate to 15 per cent...the fact that the SEZ sunset is happening, at least for the new services companies in SEZs, if you make it 15 (per cent), then you will have one composite rate in SEZ for both manufacturing and services," Nasscom Senior Director and Public Policy Head Ashish Aggarwal told PTI after the over two-hour meeting. READ MORE
12:55 PM
Sector watch | Telecom shares trade mixed
COMPANY NAME LATEST HIGH LOW CHG
(RS) CHG(%) VALUE
(RS CR) VOLUME
VODAFONE IDEA 6.09 6.25 5.97 -0.06 -0.98 8.29 13615532
REL. COMM. 0.86 0.89 0.83 -0.01 -1.15 0.04 499343
QUADRANT TELE. 0.20 0.20 0.19 0.01 5.26 0.00 101092
BHARTI AIRTEL 461.15 462.45 458.60 0.65 0.14 3.85 83564
TEJAS NETWORKS 94.75 96.95 79.35 6.60 7.49 0.66 69579
12:48 PM
NEWS ALERT | DoT to allocate spectrum for 5G trials by Jan: sources to CNBC TV18
>> Spectrum-to-spectrum allocated for a duration of 1 yr
>> All major vendors, including Huawei, present for meeting with Telecom secy

India plans $35 bn reforms over 5 yrs to revive struggling power retailers

Indiais planning another wave of reforms aimed at turning around its struggling power retailers.
The initiative is still under consideration, a power ministry spokeswoman said Tuesday, declining to provide details. The reforms could cost as much as Rs 2.5 trillion ($35 billion) over five years, according to people with knowledge of the issue.

The measures would focus on infrastructure and technology upgrades of the ailing utilities to make them more efficient and reduce financial losses, according to the people, who asked not to be identified as the information isn’t public. The efforts could include central government grants of as much as Rs 1 trillion to states that meet targets set by New Delhi, they said.
The plan could include the installation of about 250 million prepaid smart meters, which are expected to boost revenue collection.
Other measures include systems to better monitor and control networks -- known as supervisory control and data acquisition systems -- separating grids for farmers and residential users, and replacing overhead cables with special insulated wires to prevent theft.
Electricity distributors are the weakest link in the country’s power supply chain, losing almost one-fifth of their revenue because of technical and commercial reasons, including loss of power supplies through theft and poor transmission infrastructure or inefficient billing and collection. Reviving these utilities is key to ensuring reliable power supplies and improving the financial health of generators.
The investment in smart meters is expected to become part of the operating expenses of the retailers and will be funded using the efficiency gains they derive from the upgrade, according to the people. The power ministry is working with distribution companies on models for other initiatives, the officials said, with any payments from the federal government linked to meeting targets.
The new measures would follow an unsuccessful plan unveiled in 2015 to make retailers profitable by March 2019.
That effort included reducing revenue lost from theft and poor billing to an average of 15%. While such losses did decline, they were still at about 18% at the end of the year to March 2019, the power ministry said in a report in October. Combined net income losses at distributors that signed up for the reform plan in the same year widened to about Rs 280.4 billion, an 85% year-on-year increase, according to the report.

Huawei gets govt's approval to participate in 5G trials in the country

The wait may be finally over for Chinese telecom gear maker Huaweias the government has allowed all equipment manufacturers to conduct 5G trials in the country, without making any distinction.
“We have taken a decision to give 5G spectrum for trials to all players,” Telecom Minister Ravi Shankar Prasad said on Monday. “5G is future, it is speed. We will encourage new innovation in 5G.”
The decision provides a breather to the Chinese firm, which is battling security issues not just in India but worldwide.
“We have read the news in media and we thank the Indian government for their continued faith in Huawei. We firmly believe that only technology innovations and high-quality networks will be the key to rejuvenating the Indian telecom industry. We have full confidence in the Indian government and industry to partner with best technology for India’s own long-term benefit and also for cross-industry development. Huawei is committed to India,” said Jay Chen, chief executive officer, Huawei India.
The second half of the calendar year saw Huawei battling to reserve its space in India’s 5G footprint. The government had constituted a panel, headed by its principal scientific advisor, to decide on Huawei’s participation in the 5G trials. The trials would establish used cases in the country as a precursor to the full-fledged launch of the 5G services.
Huawei came under a cloud after allegations that the firm’s electronic and telecom devices helped China spy on US corporations and agencies. Huawei has been barred in Australia, and Japan. Russia, Turkey, and Saudi Arabia have welcomed it.
The Huawei India CEO had earlier said the company wants to tap India, which proposes to be the second-biggest 5G market. He had also said India is a very unique market. “You need to deeply understand it and have a long-term strategy,”he had said.
Bharti Airtel Chairman Sunil Bharti Mittal had also come out in support of Huawei. Speaking at the World Economic Forum, Mittal had said the company, in over the last decade, had become very good with its products.
"To a point where I can safely say their products in 3G and 4G that we have experienced, are significantly superior to Ericsson and Nokia. I use all three of them," Mittal had said. Huawei has been trying to compete with its rivals such as Nokia, Ericsson, and Samsung to become the top player in 5G. It has so far secured 50 commercial 5G contracts — 28 in Europe, 11 in central Asia, six in Asia-Pacific, four in South America and one in Africa. The government has begun the process of auctioning the next-generation 5G spectrum with the aim of improving data speed and bringing in Internet of Things, which will enable robotic surgeries and driverless cars among a host of other things.
On December 20, the Digital Communications Commission, the apex decision-making body, at the telecom department approved the auctions across 22 circles. A lion's share, 6050 MHz, has been set aside for 5G spectrum.
Huawei gets govt's approval to participate in 5G trials in the country

Year in review: Investors richer by over Rs 11 trn; Sensex zooms 14%

Investorsbecame richer by over Rs 11 trillion in 2019 helped by a stupendous rally in the stock market where the benchmark Sensex clocked over 14 per cent gains on an annual basis.
As the Indian equities signed off 2019 on a remarkable note, the market capitalisation (m-cap) of BSE-listed companies rose by Rs 11,05,363.35 crore to Rs 1,55,53,829.04 crore.

"The year 2019 was definitely an eventful one for the markets as a number of crucial events unfolded on both global as well as domestic front. The global growth outlook turned positive led by US Fed dovish stance and easing trade tensions between the US and China.
"On the domestic front, while worries persist on growth revival, the recent government measures have increased hopes to faster recovery. Overall, it has been a good year for Indian equities despite the slump in domestic growth," Ajit Mishra, VP Research, Religare Broking said.
On an annual basis, the Sensex rose 5,185.41 points or 14.37 per cent.
The Sensex on Tuesday ended the last trading session of 2019 304.26 points or 0.73 per cent lower at 41,253.74.
About major takeaways for markets this year, Mishra said, the year has been quite peculiar for India as on one hand growth continued to slump, however stock market rose to new highs. This is due to outperformance of select heavyweight stocks that remained least affected by the on-going slowdown.
"Therefore, the major takeaway is that in times like these where overall growth is struggling but global markets are buoyant, it is better to stick to quality names that has remained unaffected by the slowdown," he added.
In 2018, the Sensex had risen 2,011 points, or 5.9 per cent. The market capitalisation (m-cap) of the BSE-listed companies had slumped by Rs 7,25,401.31 crore to Rs 1,44,48,465.69 crore last year.
"There has been a clear divide in the economy and markets this year that has prevailed in many markets, including India. We expect the divide between Indian equities and economy to continue in CY20 because there may not be a quick recovery in the economy but market may do relatively better on account of strong earnings and favourable tax changes," Rusmik Oza, Sr VP (Head of Fundamental Research-PCG), Kotak Securities said.
Markets achieved big milestones this year, with the BSE Sensex crossing the historic 40,000 mark while the broader NSE Nifty conquered 12,000 level.
The Sensex zoomed to its record peak of 41,809.96 on December 20 this year.
Reliance Industries Limited is the country's most valued firm with a market valuation of Rs 9,59,818.81 crore.
TCS comes second in the ranking of companies based on their valuation followed by HDFC Bank, HDFC and HUL in the top five list.
In November, Reliance Industries became the first Indian company to hit the Rs 10 lakh crore market valuation mark. At market close on November 28, the oil-to-telecom conglomerate's market valuation zoomed to Rs 10,01,555.42 crore on BSE.
This year, a total of 16 main-board initial public offerings (IPOs) mopped-up Rs 12,365 crore.
About next year, Oza said, "High expectations from the budget could lead to a good start for Indian equities in 2020. To address the global slowdown we expect central banks in the developed nations to follow a loose monetary policy in CY20. This could provide ample liquidity and scope for further flows into emerging markets." "We expect scenario to improve with a broad-based rally as economic concerns subside gradually," Mishra said.

India's core sector growth contracts 1.5% in November: Govt data

Contracting for the fourth consecutive month, the output of eight core infrastructure industries shrank by 1.5 per cent in November2019 as five of the eight sectors witnessed negative growth, according to official data released on Tuesday.
The eight core sectors had expanded by 3.3 per cent in November 2018.

Production of coal, crude oil, natural gas, steel, and electricity contracted in the month under review.
The growth rate of cement production dropped to 4.1 per cent from 8.8 per cent in November 2018.
The output of refinery products and fertilizers increased by 3.1 per cent and 13.6 per cent respectively in November 2019 over the year-ago month.
During the April-November period, core industries recorded flat growth (zero per cent) against 5.1 per cent in the year-ago period.
Since August the eight core sectors are recording negative growth.

FM Sitharaman unveils Rs 102-trn infrastructure projects for next 5 years

Finance Minister NirmalaSitharaman on Tuesday unveiled Rs 102 trillion of infrastructure projects, including Mumbai–Ahmedabad High Speed rail, in the next five years to help achieve the target of $5 trillion (around Rs 356 trillion) economy by 2025.
Addressing a press conference, she said Prime Minister Narendra Modi had in his Independence Day speech spoken of investing Rs 100 trillion in infrastructure.

Subsequently, a task force headed by the Economic Affairs Secretary identified Rs 102 trillion worth of projects after conducting 70 stakeholder consultations in a short period of four months, she said.
The minister said another Rs 3 trillion of projects will be added to this pipeline that includes Jewar Airport and Jal Jeevan Mission.
"However, even as we are talking, I'm happy to say that projects are coming in and in the next couple of weeks, we get additional projects of worth Rs 3 trillion. ... So in all I think we have about Rs 105 trillion in total of projects for Rs 100 trillion commitment we made," the minister told reporters here.
Of the Rs 102 trillion projects, Rs 42.7 trillion (43 per cent) projects are under implementation, Rs 32.7 trillion (about 33 per cent) worth of projects are at conceptualisation stage and Rs 19.1 trillion (about 19 per cent) worth of projects are under development, she said.
The projects are spread across 22 ministries and 18 states and union territories, she said, adding the government also intends to launch NIP, National Infrastructure Pipeline, a coordination mechanism consisting of the Centre, states and also the private sector for information dissemination together with monitoring the implementation of this entire framework.
These projects are on top of Rs 51 trillion spent by the Centre and the states during the last six years, she said.
With regard to investment, Sitharaman said that the new pipeline consists of 39 per cent projects each by the Centre and states and the balance by 22 per cent by private sector which could increase to 30 per cent by 2025.
Economic Affairs Secretary Atanu Chakraborty said projects worth Rs 13.6 trillion would be implemented during the current fiscal, followed of Rs 19.5 trillion in 2020-21 and Rs 19 trillion in 2021-22.
In the remaining three years, he said, during 2022-23 it would be Rs 13.8 trillion, Rs 12.8 trillion in 2023-24 while Rs 11.1 trillion in the terminal year of 2024-25.
The finance minister said the projects identified are in the sectors of power, railways, urban development, digital sector, irrigation, mobility, education, health, and others.
These sectors will form the bulk of the infrastructure investment under the National Infrastructure Pipeline, Sitharaman said.
Nearly Rs 25 trillion of energy projects have been lined up, the minister said, adding that another Rs 20 trillion in road and nearly Rs 14 trillion spending in railway projects have been lined up.
The finance minister said Rs 102 trillion National Infrastructure Projects will help make India a $5 trillion economy by 2025.
On the financing, she said, the government will look at deepening of debt market and alternative investment funds which will provide bulk of the debt financing necessary for this.
"We are looking at various steps to reform the PPP based contracts which have to be implemented. Dispute resolution related, enforcement of contracts which is a very critical component, all this is also being looked at when we're talking about reforming the entire process as per the suggestion given by various sub-groups under the task force," she said.
She also announced that the first edition of Annual Global Investors' Meet will be held in the second half of the coming year to meet investors at a single platform.
The first meeting of the Task Force was held in September 2019. Subsequently, several meetings were held with various Departments/Ministries engaged in infrastructure development, Corporates engaged in infrastructure development.
This exercise, the first of its kind, is expected to be followed up by a periodical review process, she said.
NIP, which includes economic and social infrastructure projects, will enable a forward outlook on infrastructure projects which will create jobs, improve ease of living, and provide equitable access to infrastructure for all, thereby making growth more inclusive.

CAD narrows to 0.9% of GDP in July-Sept on lower trade deficit: RBI

India's current account deficit (CAD) narrowed to 0.9 per cent of GDP, or $6.3 billion, in the September 2019 quarter, on account of lower trade deficit.
It had stood at 2.9 per cent of gross domestic product (GDP), or $19 billion, in the corresponding quarter of 2018-19.

On a sequential basis, CAD had printed 2 per cent of GDP, or $14.2 billion, in the June 2019 quarter.
The current account deficit is the difference between foreign exchange inflows and outflows.
"The contraction in the CAD was primarily on account of a lower trade deficit at $38.1 billion as compared with $50 billion a year ago," the Reserve Bank of India (RBI) said in a release on Tuesday.
During the first half of the current financial year, CAD narrowed to 1.5 per cent of GDP from 2.6 per cent in the corresponding period in 2018-19, on the back of a reduction in the trade deficit, which shrank to $84.3 billion as compared with $95.8 billion a year ago.
The trade deficit is the gap between the value of imports and exports.
The balance of payment stood at $5.12 billion in the second quarter and $19.10 billion during the first half of this fiscal.
Net foreign direct investment stood at $7.4 billion, almost the same level as in second quarter of 2018-19.
Helped by net purchases in the debt market, foreign portfolio investment recorded a net inflow of $2.5 billion in the September 2019 quarter, against an outflow of $1.6 billion a year ago.
In the April-September 2019 period, while the net FDI inflows were at $21.2 billion, portfolio investment recorded a net inflow of $7.3 billion.
Net services receipts increased 0.9 per cent on in July-September on a y-o-y basis, on the back of a rise in net earnings from computer, travel and financial services, the RBI said.
In the second quarter of 2019-20, private transfer receipts, mainly representing remittances by Indians employed overseas, rose to $21.9 billion, an increase of 5.2 per cent as against a year ago.
The net inflow on account of external commercial borrowings to the country was $3.2 billion in the second quarter as compared with $2 billion in corresponding period of the previous financial year.
There was a growth of $5.1 billion in the foreign exchange reserves in the September 2019 quarter, compared with a depletion of $1.9 billion a year ago.
During the first half of 2019-20, there was an accretion of $19.1 billion of the foreign exchange reserves, the RBI said.

Delhi weather: 530 flights delayed, 40 cancelled due to dense fog

Dense fog played havoc with flight operations at the Delhiairport on Monday with around 530 flights delayed, 40 cancelled and 21 diverted.
Flights are operating at the airport under CAT III B conditions, which means the runway visual range (RVR) is between 50 metres and 175 metres.

Giving an update on flight operations, an official said 21 flights have been diverted and around 40 cancelled as of now.
"Around 530 flights - which includes 320 departures as well as 210 arrivals approximately - have been delayed on Monday," the official added.
In a statement, IndiGo airline said,"Owing to dense fog in north India our flights have been impacted across India. We will continue to review the situation and provide real time updates on our social platforms."
The airline also requested passengers to check flight status before leaving home and reach out to its customer care.
Vistara airline said on Twitter that its Delhi-Mumbai flight UK933 as well as Mumbai-Delhi flight UK996 stands cancelled due to poor visibility in Delhi.
Vistara along with GoAir, SpiceJet, AirAsia India stated on Twitter that due to dense fog and poor visibility in Delhi, their flight operations might be impacted, and advised passengers to check flight status before leaving for the airport.
Delhi, which is shivering under an intense spell of cold wave for two weeks, experienced its coldest recorded December day on Monday.

Insurance to futures, China's $45 trn finance industry is set to open up

China’sbig bang opening of its $45 trillion financial industry begins in earnest next year -- a step-by-step affair that’s unfolding just as economic strains threaten the promised windfall luring in global firms.
Starting with its insurance and futures markets, the Communist Party ruled nation will enact the most sweeping changes in decades to allow the likes of Goldman Sachs Group Inc., JPMorgan Chase & Co. and BlackRock Inc. to expand their footprint in China and compete for a slice of its growing wealth.

President Xi Jinping is seeking to cushion the world’s No. 2 economy against the steepest slowdown since the early 1990s after a crackdown on risky lending squeezed corporate funding and a trade dispute with the U.S. hit exports. Not only will foreign firms bring with them fresh capital, policy makers expect they will force entrenched domestic players to sharpen their operations and become more responsive to the market.
China is at a stage where regulators and the government are comfortable that local business can handle the threat of foreign competition, according to Paul Schulte, Singapore-based founder of Schulte Research and former head of Asia strategy for Nomura Holdings Inc. Firms like Goldman and JPMorgan “are looking to expand, merge, buy, grow in the next cycle -- not this one.”
Foreign financial firms may plow 7 trillion yuan ($1 trillion) to 8 trillion yuan of assets onshore in the next few years, Huang Qifan, vice president at China Center for International Economic Exchanges and former mayor of Chongqing, said this month.
For the global powerhouses, the opportunities are immense barring a major economic slowdown or change of course. Up for grabs is an estimated $9 billion in annual profits by 2030 in the commercial banking and securities sectors alone, according to Bloomberg Intelligence forecasts.
Here’s a chronological guide to what steps await, what’s at stake, and who’s rushing in.
Insurance
To kick off the new year, foreign insurers can apply to set up 100%-owned units offering life insurance, a segment that accounts for three-quarters of the Chinese insurance market. Joint ventures -- of which ICBC-AXA Assurance Co. is the biggest -- brought in 8% of the sector’s total premiums last year, but have not been growing as fast as domestic competitors, according to Fitch Ratings.
Local firms dominate the market with their vast distribution networks and millions of agents, led by China Life Insurance Co. and Ping An Insurance (Group) Co. Among those poised to expand their presence is German insurer Allianz SE, which in 2018 got the green light to set up the first entirely foreign-owned insurance holding company.
Others including Cigna Corp. and Standard Life Aberdeen Plc. have indicated no intention to seek control, with Cigna calling its partnership with China Merchants Bank Co. a “winning formula.”
“There’s no best approach clearly in sight” for fully foreign-owned life insurers, said Jimi Zhou, a partner of consulting at PwC China. “The pie is big enough, but it depends on how you want to eat it.”
Futures
Also on the first day of the year, overseas firms will be allowed to set up their own entities to trade futures in a crowded market where nearly 150 local players had combined profits of only 3.4 billion yuan ($485 million) in the first half.
Graph
Foreign interest has so far been limited by restrictions in China on making unhedged bets against the market and quotas imposed on index and commodity futures. That could change quickly should authorities push forward with a broad swath of changes in the derivatives space.
Overseas companies currently have a tiny presence in China’s futures market. JPMorgan owns 49% of a joint venture, while UBS Group AG controls a futures subsidiary through its onshore securities outfit.
Asset Management
Asset management is a hotter ticket. Foreigners will be able to apply for licenses to start wholly owned mutual fund management firms in April, or buy out local funds.
What Bloomberg Intelligence Says
“Mutual funds asset growth in China could outpace the world over the next decade. Investment banking and securities revenue could rise as the country’s capital markets develop. Foreign players must navigate challenges including competition for talent and regulatory hurdles.”
-- Sharnie Wong, senior analyst.
The stakes are high with households sitting on about 90 trillion yuan in investable assets. But, the competition is cut-throat.
Hedge funds already in business in China have found it difficult to amass assets that gravitate to local high-flyers. Three years after the market was opened, BlackRock, Man Group Plc and 20 other firms licensed to run so-called private securities funds for high-net-worth individuals manage just 0.2% of China’s 2.5 trillion yuan in hedge fund assets.
The competition may be easier to pick off in the broader mass market, where the domestic industry is trying to shift away from guaranteed-return products, mostly offered by state-backed banks. Outstanding wealth products issued by Chinese lenders stood at 22 trillion yuan as of June 30, making them the nation’s biggest asset managers.
Brokerage and Investment Banking
A seismic shift will begin toward the end of 2020 after global investment banks are allowed to operate on their own from Dec. 1.
While some have been doing business in China for over a decade, serving as dealmakers for the nation’s corporate titans across the globe, taking full control will allow Wall Street firms to dictate expansion plans and navigate away from culture clashes with local partners.
They will meet fragmented competition as China’s 131 brokers are comparative minnows with combined assets equal to what Goldman Sachs sits on by itself. Still, a recent push by regulators to forge local investment banking giants means the competitive landscape in China’s $21 trillion equity and bond markets may become more challenging.
For China, the opening is as much a chance to reform financial markets and strengthen local champions as it is an opportunity to address U.S. complaints about the Asian nation being a one-sided beneficiary of trade. With the world’s two largest economies now moving closer to signing the first phase of a trade deal, the slow dismantling of restrictions is set to continue apace.
Addressing more than a dozen delegates including former U.S. Treasury Secretary Hank Paulson and Credit Suisse CEO Tidjane Thiam in Beijing in November, President Xi was clear though that the liberalization of financial services would continue on China’s terms. The nation will remain vigilant to ensure it preserves its “financial sovereignty,” he said.