| News Announcement |
Impact Analysis |
- Nifty and Sensex plunge on Friday led lower by Tata Motors
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- The Tata Motors stock corrected nearly 18% in a single day after a record loss of Rs.27,000 crore in Q3
- The markets were also roiled by the growth downgrade of EU economies and the ongoing trade war
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- Edelweiss and L&T Finance clarify to BSE after ADAG allegations
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- ADAG group had alleged that Edelweiss and L&T Finance had deliberately dumped shares to depress prices
- Both companies have clarified that the pledged shares were sold in the market only after repeated notices of default
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- RBI cuts repo rates by 25 bps in its February monetary policy
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- The repo rates were cut by 25 bps to 6.25% taking the reverse repo to 6% and the bank rate to 6.5%
- In addition, the RBI also changed the stance of the policy from “calibrated tightening” to “neutral”
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- RBI relaxes ECB borrowing rules for potential IBC bidders
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- Now potential bidders will be permitted to fund their target company loan repayments using ECB borrowings
- This will be an exception only for IBC since ECBs cannot be used to repay domestic loans currently
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- Banks can now lend to NBFCs based on variable risk weights
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- Currently, all bank lending to NBFCs attracts mandatory 100% risk weight for capital adequacy purposes
- Now the bank has the leeway to assign risk weights to the NBFC portfolio based on credit ratings
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- RBI now permits unlimited group exposure to FPI inflows into debt
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- Currently, FPIs can only up to 20% of their total investment in Indian corporate bonds into a single business group
- This relaxation will ensure that FPIs are not compelled to diversify their debt just for regulatory purposes
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- Vodafone idea reported record losses of Rs.5,005 crore in third quarter
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- This is much higher than the Rs.4000 crores of losses reported by Vodafone idea in the previous quarter
- With the lowest ARPU of Rs.84, Vodafone Idea is literally losing money on every new client acquired and serviced
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- Tata Motors reported net loss of Rs.27,000 crore in Dec quarter
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- This was due to an extraordinary write-off due to asset impairment in the books of Jaguar Land Rover
- JLR is under stress due to the impending BREXIT well as due to slowdown in demand in its core market of China
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- Telecom companies start shedding of low margin customers
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- Bharti Airtel and Vodafone have cancelled over 10 crore customers with monthly billing of less than Rs.35
- Jio is now the only company that is willing to offer absolutely bottom rates for low value customers
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- Global ecommerce giants restructure their vendor ownership
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- There has been a rapid restructuring of the vendor relations with Amazon taking the lead in the process
- Its JV with Catamaran has reduced its stake to below 25% as per the new ecommerce policy
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- Anil Ambani’s RCOM files for bankruptcy in NCLT
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- With the process of sale to Reliance Jio taking longer than expected, the creditor pressure has been building up
- The company still has 270 days time to work out a resolution and it could be done with Reliance Jio itself
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- RBI governor underlines government has full freedom on reserves
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- The government has been demanding a higher share of RBI reserves this year to bridge the resource gap
- The proposed RBI board meeting for interim dividend has been put off now to February 18th
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- Banks pressure Essar Power on personal guarantees given
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- ICICI bank and IDBI have moved the DRT to cash the personal guarantees given by Ruias for the debt of Essar Power
- If the guarantee is invoked then the Essar group could have trouble raising requisite resources for Essar Steel
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- Saudi Arabia pumped just 10.24 million bpd of crude in January
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- This is lower than the eligible quote of 10.331 bpd that is allowed for Saudi Arabia under the OPEC agreement
- Being the world’s largest oil exporters, Saudi actions still have a major bearing on the oil prices globally
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- Banks may fall short of deposit collections by $75 billion this year
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- Banks need deposit inflows of $350 billion in next two years against the regular annual flow of $100 billion
- This has been necessitated because the growth in deposits has not kept pace with loan growth in last few years
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- US reports a fall in trade deficit for the first time in 6 months
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- The sharp 11.3% fall in trade deficit in January was largely driven by reduced imports of phones from China
- Global markets have interpreted this as a sign of a slowdown in global trade with implications for GDP growth
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- Mutual funds make a request to SEBI to give more time to Zee to pay its debt
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- Mutual funds have exposure to the tune of Rs.8000 crore to the Essel Group and this could be a setback for them
- Subhash Chandra has agreed to restructure and repay all their debentures by September this year, subject to SEBI approval
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- Government may shift to pre paid power to reduce losses
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- Currently, power suppliers owe close to $5.7 billion to power producers in the form of unpaid dues
- In India, nearly 20-25% of the power gets lost in transmission due to theft and pilferage making the problem worse
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