QBiz: Blow to Airtel, Vodafone Idea; Adani Firm Under CBI Scanner
Your daily round-up of latest business news on QBiz.
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1. Blow to Airtel, Vodafone Idea as Supreme Court Dismisses AGR Plea
The Supreme Court on Thursday, 16 January, dismissed pleas, including those of Bharti Airtel Ltd and Vodafone Idea Ltd, to review its earlier judgment that had asked telecom operators to pay more than Rs1 trillion of dues to the government.
Bharti Airtel, which has to pay Rs 35,586 crore to the government by 24 January, and Vodafone Idea, which owes the government Rs 50,000 crore, said they were evaluating filing curative petitions.
The court’s refusal to review its order is the latest setback for the telecom operators, which have reported record losses in the September quarter and are struggling under mountains of debt. Without any relief from the courts, the operators will now have to ensure that they pay the dues in about a week or seek urgent help from the government.
(Source: Livemint)
2. CBI Files Criminal Case Against Adani Enterprises
The Central Bureau of Investigation (CBI) has filed a criminal case against Adani Enterprises Ltd for colluding with officials of the National Cooperative Consumers’ Federation (NCCF) to unfairly win a contract for supplying coal to an Andhra Pradesh government-owned company.
The agency named former NCCF chairman Virender Singh, its then managing director GP Gupta and former senior adviser SC Singhal in the first information report (FIR). Adani Enterprises and the NCCF officials were booked under the Prevention of Corruption Act.
(Source: Livemint)
3. Debt-Laden GMR Infra to Now Sell 49% Stake in Airport Vertical
Infrastructure major GMR Group on Thursday, 16 January, said that it will now sell 49% in its airports subsidiary, GMR Airports, to investors including the Tata Group, Singapore sovereign wealth fund GIC and SSG Capital Management.
The earlier agreement between the GMR Group and the investors, signed last year, was to sell 44.44% stake in GMR Airports for Rs 8,000 crore.
According to the earlier agreement, the proposed investment was to be disbursed in two parts — a Rs 1,000-crore equity infusion in GMR Airports, and purchase of GMR Airport’s equity shares worth Rs 7,000 crore from GMR Infrastructure and other group companies.
(Source: Financial Express)
4. SEBI Exonerates Ravi Narain, 8 Others in NSE Dark-Fibre Case
Market regulator SEBI has exonerated former National Stock Exchange MD and CEO Ravi Narain and a few other senior officials in a matter involving dark-fibre connectivity at the stock exchange.
SEBI had asked NSE to deposit Rs 62 crore of estimated ‘ill-gotten wealth’ but the regulator on Thursday, 16 January, said the nine officials, including Narain, cannot be held responsible for any misconduct or non-compliance in the so-called ‘dark-fibre issue’.
Former officials absolved from the charges include senior V-P (operations) R Nandakumar, Co-Location head Jagdish Joshi, CTOs N Muralidharan and Ravi Apte.
(Source: The Hindu BusinessLine)
5. IL&FS Case: NCLAT to Provide Formula for Distribution of Proceeds Among Creditors
The National Company Law Appellate Tribunal (NCLAT) on Thursday, 16 January, said it will provide a formula for proceeds distribution among the creditors of debt-ridden IL&FS group firms.
A NCLAT-bench headed by Chairperson Justice S J Mukhopadhaya said its formula would balance the interests of all stakeholders, including creditors.
The tribunal have also asked some of the lenders to file revised framework proposed by the Ministry of Corporate Affairs within a week, stating their position in the resolution of IL&FS group, which has a cumulative debt of over Rs 90,000 crore.
(Source: The Economic Times)
6. Banks Loan Growth at 7.5% in Fortnight to 2 Jan: RBI Data
Banks credit grew by 7.57 percent to Rs 100.44 lakh crore while deposits rose by 9.77 percent to Rs 132.10 lakh crore in the fortnight to 2 January, according to the Reserve Bank data. In the year-ago period, banks loans stood at Rs 93.37 lakh crore while deposits at Rs 120.33 lakh crore.
In the previous fortnight ended 20 December, credit had grown by 7.10 percent to Rs 99.47 lakh crore and deposits had increased by 10.09 percent to Rs 130.08 lakh crore.
On a year-on-year basis, banks' credit growth slowed to 7.2 percent to Rs 86.73 lakh crore in November 2019 from 13.8 percent to Rs 80.93 lakh crore in the year-ago period.
(Source: The Economic Times)
7. MEIS Scrapped: Garment Exports May Shrink 10% in Q4FY20
The government has decided to scrap incentives for the garment and made-ups sector under a key programme — the Merchandise Exports from India Scheme (MEIS) — retrospectively from 7 March 2019, dealing a deadly blow to cash-starved exporters, who warn that the already-faltering outbound shipments of apparels could plunge further to around 10% in the last quarter of the fiscal, against a 0.8% rise in the April-December period.
Exporters decry the retrospective withdrawal.
Exporters say prior to the decision, the government had blocked the release of benefits worth over Rs 5,000 crore for the garments and made-ups sector under both the MEIS and the Rebate of State and Central Taxes & Levies (RoSCTL), meant for compensating them for various state and central government imposts. Under MEIS, the government used to provide garment and made-up firms incentives worth 4% of the freight-on-board (FoB) value of exports.
(Source: Financial Express)
8. Nestle to Invest Billions to Boost Use of Recycled Plastics
Food giant Nestle will invest up to 2 billion Swiss francs ($2.07 billion) to source more recycled plastics for packaging its products and reduce its use of new plastics by a third by 2025, it said on Thursday, 16 January.
Regularly cited by environmentalists as one of the top plastic polluters, Nestle is under pressure to show it is serious about addressing the waste reduction problem. It has vowed to make 100% of its packaging recyclable or reusable by 2025.
"We are high up on the list because we are one of the largest companies out there in packaged goods and now we're also taking pretty big steps in using our size to actually solve the problem," Chief Executive Mark Schneider told journalists.
(Source: The Economic Times)
9. In Relief for Asset Managers, FinMin Excludes Mutual Funds From Foreign Investor
The finance ministry has exempted mutual funds from being categorised as foreign investors, a status that would have subjected them to foreign direct investment (FDI) sectoral caps and various Foreign Exchange Management Act (Fema) rules. A finance ministry notification in this regard came in December 2019.
A 17 October ministry circular had classed mutual funds with more than 50% foreign shareholding as foreign investors, ignoring the fact that mutual funds are investment vehicles for unit holders, including retail investors. The ministry has now excluded mutual funds from the category, reverting them to their original status.
(Source: Livemint)
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