1. RBI Hikes Repo Rates Second Time in a Row This Year
The Reserve Bank of India (RBI) resorted to a back-to-back interest rate hike for the first time in almost five years to curb inflation and pre-empt a rout of the rupee as the global trade war escalates.
The central bank’s six-member monetary policy committee on Wednesday, 1 August, voted 5-1 to raise policy rates by 25 basis points to 6.5%. This is the first time since October 2013 that RBI has raised rates in consecutive meetings of its rate-setting panel. It raised interest rates by 25 basis points in its June meeting.
The possibility of another rate hike this financial year remained as RBI governor Urjit Patel reiterated his intention to stick to the 4% inflation target. The MSP hike is the primary factor stoking inflation this year, RBI said. The government has fixed MSP at 150% of the cost of production of all kharif crops.
(Source: Livemint)
2. 7 Indian Firms on Fortune 500 list, Reliance Jumps to 148th
Seven Indian companies have made it to the latest Fortune 500 list of the world's biggest corporations in terms of revenue, with state-owned Indian Oil Corporation (OIL) continuing to be the highest ranked Indian firm and Reliance Industries (RIL) jumping 55 places.
In the list topped by retail giant Walmart, Indian Oil Corporation with 23 percent rise in revenues at USD 65.9 billion was ranked 137th, up from the 168th position in 2017, Fortune said.
Richest Indian Mukesh Ambani-led RIL was the top private sector company from the country as it jumped from 203rd rank last year to 148th. It had a revenue of USD 62.3 billion in 2017-18.
Other Indian companies on the list are Tata Motors, Oil and Natural Gas Corp, State Bank of India, Bharat Petroleum Corp Ltd and Rajesh Exports.
(Source: PTI)
3. LIC-IDBI Bank Deal Gets Cabinet Nod
The Union Cabinet on Wednesday gave its nod to a proposal for Life Insurance Corporation of India (LIC) to acquire 51% stake in IDBI Bank through preferential offer of equity. There will also be an open offer for IDBI Bank shareholders by LIC once the transaction is complete.
Finance minister Piyush Goyal said independent boards of the two state-run companies have taken this decision. He also said insurance regulator IRDA has given an in principal approval to LIC to buy controlling stake in IDBI Bank.
IDBI Bank had approached the Cabinet for approval as government’s stake would drop below 51% after the share sale to LIC. The government currently holds an 85.96% stake in IDBI Bank.
(Source: The Economic Times)
4. Government Collects Rs 96,483-Crore GST For June
Goods and Services Tax (GST) collections rose to Rs 96,483 crore in July, from Rs 95,610 crore in the previous month, on improved compliance post implementation of the e-way bill. As many as 66 lakh businesses filed returns last month, making it the highest number of monthly Goods and Service Tax Returns-3B (GSTR) filed since the rollout of GST in July last year.
In the current fiscal, the month-wise revenue mopped up from GST stood at Rs 1.03 lakh crore in April, Rs 94,016 crore in May and Rs 95,610 crore in June. As many as 60.47 lakh returns were filed in April, 62.47 lakh in May, 64.69 lakh in June.
“GST revenue collections are improving after implementation of e-way bill which is a major tool under GST to curb tax evasion. However the government is still short of average monthly target of revenue fixed in Budget of 2018-19,” Taxmann DGM Vishal Raheja said.
(Source: PTI)
5. RBI Asks Paytm, Fino Banks to Stop Enrolling New Customers
India’s payments banking ecosystem has taken a serious hit as the Reserve Bank of India (RBI) has halted two of the three existing payments banks from enrolling new customers.
Concerns over the eKYC, or electronically done know your customer process, as well as cases of more than Rs 100,000 being deposited in accounts, have caused the RBI to ask Paytm Payments Bank as well as Fino Payments Bank to halt inducting new customers for the time being.
Airtel Payments Bank, which was earlier asked by the nodal agency not to enrol new customers, got permission to resume the process last month.
Sources said the nodal agency over the past two months had been doing an audit of the two banks and would at the end of it ask them to be in shipshape condition before resuming customer enrolment.
(Source: Business Standard)
6. Car Sales Slow in July on High Base
Passenger car sales, which had a stellar run since January 2018 on the back of new launches and a recovery in rural demand, saw a slowdown in July because of a high base in the same month last year and a planned inventory reduction by auto makers ahead of the launch of new models and refreshes during the festive season beginning later this month.
A nationwide transporters’ strike in mid-July also impacted production and distribution of vehicles. Auto makers in India consider dispatches to dealerships as sales.
India’s top five carmakers, Maruti Suzuki India Ltd, Hyundai Motor India Ltd, Honda Cars India Ltd, Mahindra and Mahindra Ltd and Tata Motors Ltd, collectively sold 236,947 units during the month, up 1.14% from 233,643 units a year ago. The slowdown in sales this month is an aberration as underlying retail demand, primarily from semi-urban and rural areas, has remained stable as expected, analysts said.
(Source: Livemint)
7. OnePlus a Hit Due to Single-Product Focus
OnePlus founder & CEO Pete Lau said his brand’s outstanding performance in India went way beyond his initial expectations, and attributed it primarily to two elements, the company’s total focus on a single flagship product, and its culture of listening closely to the voices of its user community to understand their expectations.
On Tuesday 31 July, global research firm Counterpoint said One-Plus had surpassed Samsung to lead the premium smartphone segment (over Rs 30,000) for the first time ever in the second quarter of 2018. It estimated One-Plus’ share at 40%, and Samsung’s at 34%. Apple was third, but way behind at 14%.
Counterpoint noted that with every flagship OnePlus launch, its user base had been growing in India and this was now translating to record sales for every new flagship. The last quarter had seen the launch of the OnePlus 6, which saw kilometre-long queues in front of some of its stores in India.
(Source: The Times of India)
8. PhonePe Claims Leadership in UPI Payments
Flipkart-owned digital payments service PhonePe claims it has become the largest player on India’s Unified Payment Interface (UPI) network, edging out rivals such as Paytm, Google’s Tez and the National Payments Corporation of India’s (NPCI) BHIM payment apps.
The company on Wednesday, 1 August said that it had cornered 40 percent of all transactions on the UPI network, amounting to around 94 million in the month of July. This also helped the company cross the 100 million overall monthly transactions milestone for the first time.
“The PhonePe platform has witnessed incredible transaction volume growth over the past few months. Our market share of UPI transactions has jumped to 40% in July. This is validation that, for genuine consumers, PhonePe is their preferred UPI app of choice,” said Sameer Nigam, co-founder and CEO of PhonePe, in a statement.
(Source: Business Standard)
9. Govt Appoints KM Birla, Deveshwar on Air India Board
The government has appointed Aditya Birla Group chairman Kumar Mangalam Birla and ITC chairman YC Deveshwar as nonofficial independent directors for Air India. Deveshwar had earlier headed the erstwhile Air India during 1991-94, when the airline was still in the black and profits had shored up under him.
Cleared by the PM-headed appointments committee of the Cabinet, the two businessmen will be on AI board for three years unless the next government in 2019 decides otherwise. The move comes as AI is now struggling to survive after the NDA’s failed divestment bid.
Previously, governments have also tried to pick top business minds to revive AI. In 2010, business leader Anand Mahindra along with Ambuja Realty Group’s Harshavardhan Neotia, and Amit Mitra were brought as directors.
(Source: The Times of India)
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