QBiz: Oct Likely Deadline for Air India Sale; Maruti Cuts Output
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1. Govt Likely to Set October Deadline for Cash-Strapped Air India Sale
The build-up to Air India privatisation has taken off in full swing with the Union Budget announcing it as the centrepiece of divestment this year. The government is targeting October as the deadline for announcing the deal.
Not leaving anything to chance after a failed attempt earlier, the government has shortlisted the potential bidders, with the Tata group on top for its interest in aviation. Sources in the know said the government would initiate talks with businesses, including Tatas, shortly for divesting its stake in the national carrier.
The proposed dialogue with potential buyers will coincide with the government procedure of issuing bid documents for expression of interest sometime this month.
(Source: Business Standard)
2. Dodging Tax to Be Tougher as Budget Plugs Loopholes
Finance Minister Nirmala Sitharaman’s first budget seeks to widen tax officials’ surveillance on transactions and people to prevent revenue leakages and improve compliance.
The Finance Bill tabled in Parliament by the minister is replete with proposals to expand the scope of income reporting as well as deduction of tax at source on transactions that otherwise go unreported.
The proposals are part of the Modi administration’s broader strategy to widen the tax base as the government seeks to boost tax collections to fund welfare proposals, including a scheme to expand income support for farmers.
(Source: Livemint)
3. Maruti Suzuki Slashes Production by 16% in June, Posts Fifth Cut in a Row
The country's largest car maker Maruti Suzuki India (MSI) has cut vehicle production for the fifth consecutive month in June, according to a regulatory filing.
The auto major said it slashed total vehicle production, including Super Carry LCV, by 15.6 percent last month to 1,11,917 units as compared to 1,32,616 units in the year-ago month.
Total passenger vehicle production stood at 1,09,641 units last month, down 16.34 percent from 1,31,068 units in June 2018.
(Source: PTI)
4. Budget Impact: Sebi May Give Listed Firms Two Years for 35% Public Holding
The Securities and Exchange Board of India (Sebi) may give listed companies two years to increase minimum public shareholding from 25 percent to 35 percent, a proposal floated in the Union Budget 2019-20. “The compliance and time frame would be similar for all listed companies, including public sector undertakings,” said a government official in the know, adding Sebi would come up with a detailed framework after consultation with all stakeholders.
The market regulator is examining all the modalities and will issue a discussion paper soon.
(Source: Business Standard)
5. Jeff Bezos Finalises Divorce; Mackenzie Walks Away With $38 bn Settlement, 19.7 mn Amazon Shares
Amazon founder Jeff Bezos and MacKenzie Bezos finalised their divorce Friday, 5 July, to the tune of a USD 38-billion settlement, Bloomberg News reported. Under the agreement, MacKenzie Bezos, 49, will receive approximately 19.7 million Amazon.com shares, giving her a four percent stake in the company valued at USD 38.3 billion, and landing her at 22nd on the Bloomberg Billionaires Index, the news service said.
A judge in Washington state's King County finalised the divorce. Jeff Bezos, 55, will retain a 12 percent stake and remain the world's richest man. MacKenzie Bezos, a novelist, has said she would give all of her stake in The Washington Post and the space exploration firm Blue Origin to her husband as well as voting control of her remaining Amazon stock.
(Source: PTI)
6. Budget 2019 Waives Re 1 per Tonne Excise Duty on Oil Output
As a token incentive for crude oil producers — especially who plan to bid for 66 hydrocarbon fields offered by ONGC and Oil India for enhanced recovery — the government has decided not to charge the Re 1 per tonne excise duty for their production, which was introduced in Budget 2019.
The charge will be nil for ‘crude petroleum oil produced in specified oil fields under production-sharing contracts or in the exploration blocks offered under the New Exploration Licensing Policy through international competitive bidding’, the Budget documents states.
(Source: Financial Express)
7. Sail Reinvites EOIs to Sell Three Loss-Making Units
In order to get rid of three operational loss-making units, Steel Authority of India (SAIL) has invited expressions of interest (EoIs) from potential bidders for outright sale of these units. A similar attempt in 2017 did not fructify for want of buyers.
The three units – Alloy Steel Plant (ASP), Salem Steel Plant (SSP) and Visvesaraya Iron and Steel Plant (VISP) – have incurred combined loss of `2,300 crore in the last five years, causing a huge strain on SAIL’s books. These three units have a total of 2,100 permanent employees.
ASP, SSP and VSP are located in West Bengal, Tamil Nadu and Karnataka, respectively.
(Source: Financial Express)
8. Partial Credit Guarantee Scheme Unlikely to Help Stressed NBFCs
The benefits of the partial credit guarantee scheme for purchases of asset pools by banks from non-banking financial companies (NBFCs) could be limited to housing finance companies (HFCs) and microfinance institutions (MFIs), bankers and industry executives said.
Moreover, banks are expected to be particular about the health of the companies they buy pools from, as the Budget offers the credit guarantee to public sector banks (PSBs) against purchase of only high-rated pooled assets of financially-sound NBFCs.
For their part, PSBs are choosing to wait for further guidelines from the regulator before zeroing in on prospective loan pools.
(Source: Financial Express)
9. Deutsche Bank to Slash 18,000 Jobs in Sweeping Restructuring
Germany's struggling Deutsche Bank said on Sunday, 7 July, it would cut 18,000 jobs by 2022, downsizing its volatile investment banking division in a restructuring aimed at restoring consistent profitability and better returns to shareholders.
The Frankfurt-headquartered bank said it would cut roughly a quarter of its total annual costs, from 22.8 billion euros ($25.6 billion) last year to 17 billion euros, through steps such as dropping the investment bank's stock-trading business.
It also plans to slim the division focused on fixed-income investments.
(Source: AP)
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