Air India remains a knotty problem
What started as a massive exercise to privatize the loss-making state-run carrier Air India, ended up with the government stuck infusing more taxpayers’ money into the debt-ridden airline. Going ahead, sources say it is unlikely that the government will stop infusing capital. Air India has had some long-standing problems which has eaten into its profitability, including several loss-making routes and inadequate manpower.
Plans to divest 76 per cent of the government’s stake in Air India did attract the attention of multiple players. However, the terms under which the sale was being offered were considered far too stringent for any player to rescue the ‘Maharaja’ of the skies.
Mazagon dock shipbuilders ipo likely by February end
Mumbai-based defence warships, frigates and submarine-builder Mazagon Dock Shipbuilders is likely to come out with an initial public offer (IPO) of shares by the latter half of February, sources said. The government, which owns the firm, plans to sell around 2.24 crore shares or 10 per cent stake as part of its disinvestment programme to raise around Rs 800 to Rs 900 crore.
The share sale was originally planned for September, around the time when the other defence public sector undertaking Garden Reach Shipbuilders’ issue was launched. However, poor market conditions made it difficult for GRSE to sail through and other offers from the PSU stable were put on hold. Mazagon Dock has the distinction of being the only defence shipyard to build conventional submarines.
Asian infrastructure investment bank to provide local currency financing in India, Pakistan
China-based Asian Infrastructure Investment Bank (AIIB), in which India is the second largest shareholder, plans to launch local currency financing in India and some other Asian nations later this year to reduce cross-border investment risks caused by exchange-rate fluctuations.
The first group of countries to have this new service could include India, Indonesia and Pakistan, AIIB President Jin Liqun was quoted as saying by state-run China Daily.
Using local currency for cross-border financing is a service usually provided by multilateral development organisations to hedge against foreign exchange-rate risks arising from the settlement in US dollars.
The risk grew when the greenback became stronger against currencies in many emerging economies last year.
Thermax inaugurates Rs 166 crore manufacturing facility in Andhra Pradesh
Energy and environment solutions provider Thermax Thursday inaugurated its new manufacturing facility in Sri City, Andhra Pradesh, built with an investment of Rs 166 crore.
“The company’s latest production unit will manufacture a wide range of vapour absorption machines comprising chillers, heat pumps and heaters in its first phase. Constructed on a 40-acre plot in the domestic tariff zone at Sri City with an investment of Rs 166 crore (USD 23 million) in phase I, the unit has a capacity to produce 400 machines per year,” Thermax said in a BSE filing.
The new plant will also be an important manufacturing hub for Thermax’s global operations that will augment its export capabilities, Thermax Chairperson Meher Pudumjee said.
Adani, Welspun to set up logistics parks separately in Hyderabad
The Adani Group and textile major Welspun Group are in the process of setting up two separate Logistics Parks here, a senior government official said here Wednesday.
Jayesh Ranjan, principal secretary, Telangana IT and Industries, said these parks, to be set up separately by th firms, have attracted the attention of some major global and domestic logistics players.
He said the government’s ‘investment friendly’ industrial policy TS iPass, coupled with the fact that the state is geographically located at an ideal place in the country, among others, made it ideal for logistics management for firms.
SBI left data of millions of customers unprotected for two months: report
A data security scandal has hit India’s largest public sector bank after a media report claimed that State Bank of India left a server with banking data (bank balances, recent transactions) of its customers unprotected for two months. SBI has now secured the server.
According to a report by Techcrunch, the server which is hosted in a regional Mumbai-based data centre, stored two months of data from SBI Quick meant for users to request basic info about their bank accounts via a text message or on a call.
The report goes on to point how the bank’s server was not password-protected, allowing anyone with the technical know-how to access the data of millions of customers’ information. According to Google Playstore, there have been 10-million-plus installs of the SBI Quick app.
Techcrunch claimed the passwordless database allowed them “to see all of the text messages going to customers in real time, including their phone numbers, bank balances and recent transactions”.
Union budget is a make-or-break chance for PM Modi to woo voters
Indian Prime Minister Narendra Modi has a last-ditch attempt to win voters with possible populist spending measures in Friday’s budget, risking his debt targets in the process.
Modi is feeling the heat after his ruling Bharatiya Janata Party lost control of three key states in regional elections last month, setting the stage for a contentious national vote that’s due by May. He’s coming under pressure from a resurgent opposition, which is going all out to lure voters with debt waivers for farmers and pledges of welfare grants for the poor.
Indian oil net profit falls 90 per cent on inventory losses
Public sector oil major Indian Oil Corporation (IOC) on Wednesday reported a 91 per cent fall in its third quarter net profit, primarily due to lower refining margins and inventory losses due to falling crude oil prices.The company posted a net profit of `716.82 crore in October-December 2018 compared to `7,883.22 crore reported in the year-ago period, said IOC Chairman Sanjiv Singh.
“The variation is mainly on account of inventory losses which were partly made up from forex gains,” he pointed out.
With international oil prices diving over the quarter, the company posted inventory losses on stock it had bought while prices were high, suffering an inventory loss of `6,655 crore in the quarter, in contrast to an inventory gain of `5,220 crore in the corresponding period of the previous fiscal. However, Singh also said that this fall had been offset partially by `2,084 crore gains from foreign exchange
The company’s refining margins took a beating, coming in at $1.15 for turning every barrel of crude oil into fuel in the quarter, compared to a gross refinery margin (GRM) of $12.32 per barrel in the corresponding period of the previous fiscal year.
Excluding inventory losses, refinery margin was $5.12 per barrel in the third quarter as opposed to $7.42 a year ago, Singh said, adding that the GRMs were higher than Singapore average.
The company’s turnover recorded a rise to `1.6 lakh crore from `1.32 lakh crore during the third quarter, with domestic fuel sales up 3 per cent at 21.5 million tonne (MT) while its refineries turned almost 19 MT of crude oil into fuel in the quarter. This is in comparison with 18.23 MT crude throughput in October-December 2017.IOC Director (Finance) A K Sharma said the company’s borrowings went up by `5,000-6,000 crore in the quarter as the government delayed payment of LPG and kerosene subsidy.
Rupee gains 26 paise to 70.86/usd in early trade as Fed keeps rates unchanged
The rupee appreciated by 26 paise to 70.86 against the US dollar in opening trade Thursday, driven by weakening of the greenback in overseas markets after the US Fed kept interest rate unchanged.
The US dollar weakened in the overseas market after the Federal Reserve left the key US lending rate unchanged on Wednesday, and said it would be “patient” about making any further changes.
Besides selling of the American currency by exporters, forex traders said fresh foreign fund inflows and positive opening in domestic equities also supported the rupee up move, while surging crude oil prices restricted the uptrend.
The rupee opened strong at 70.92 at the interbank forex market then gained further ground and touched 70.86 amid weakening of the American currency, displaying gains of 26 paise over its last close.
The rupee Wednesday had weakened by just 1 paise to close at 71.12 against the US dollar.
Foreign funds purchased shares worth Rs 130.25 crore from the capital markets on a net basis, and domestic institutional investors also bought shares worth Rs 502.26 crore Wednesday, provisional data showed.
India’s unemployment rate highest in 45 years: report
India’s unemployment rate rose to a 45-year high during 2017-2018, according to a survey conducted by the National Sample Survey Office.
The assessment conducted by the NSSO revealed that the unemployment rate stood at 6.1 per cent, which is the highest since 1972-1973, Business Standard reported. According to the data, the unemployment rate stood at 7.8 per cent in urban areas, while it was 5.3 per cent in the rural areas.
The acting chairman of the National Statistical Commission and another member who reviewed the jobs data resigned this week, citing a delay in the survey’s release. PC Mohan, the head of the NSC, said he and his colleague J Meenakshi were disappointed with the non-publication of the data which was supposed to be released in December. The duo alleged the interference of other state agencies over backdated GDP data.
The survey is the first solid assessment of the country’s employment status since November 2016, when Modi jolted the nation with demonetisation, the report stated.
Demonetisation struck on the roots of parallel black economy: President Kovind
Describing demonetisation as a defining moment in the NDA government’s war on corruption, President Ram Nath Kovind on Thursday said it had struck at the very root of the parallel economy which was thriving on black money.
Addressing the joint sitting of Parliament, Kovind listed several measures taken by the government, like the enactment of new laws, the constitution of Special Investigation Team (SIT) and signing of tax information exchange agreements with various tax havens, to effectively deal with the menace of black money. “Demonetisation was a defining moment in the government’s war on corruption and black money. This decision struck at the very root of the parallel economy thriving on black money, and the money outside the formal system was brought within the ambit of the nation’s economy,” he said.
The government had demonetised currency notes of 500 and 1000 denomination on November 8, 2016, to check black money. Post note ban, Rs 15.31 lakh crore worth demonetised notes were deposited in banks within a stipulated time. This was 99.3 per cent of the Rs 15.41 lakh crore worth Rs 500 and Rs 1,000 notes in circulation on November 8, 2016.
The President said assets worth more than Rs 50,000 crore are being confiscated under the Benami Property Act, Prevention of Money Laundering Act and the law against fugitive economic offenders. “As a result of the policies of my government, black money in real estate sector has declined substantially, the prices of houses have come down and the dream of a normal middle-class family for possessing their own house is being realised,” he said.