1. Market Chases a Rate Cut as Monsoon Cheers
It’s a sunny side up for the markets as stocks, bonds, rupee --all are rallying. Good rainfall, moderate MSP hike and positive sign from Fed led market players to believe inflation will ease further and help Rajan lower rates.
A surprisingly good start to the monsoon, an increase in minimum support prices (MSP) that’s not too extravagant and a favourable reading of Janet Yellen’s US Federal Reserve statement -all that’s led the markets to price in an interest rate cut. The rupee rose to its highest in more than a month.
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2. Jaitley reassures global investors on tax regime, reforms pace
Finance Minister Arun Jaitley, who began a 10-day trip to the US on Wednesday, met investors and said while there is “a lot of excitement and a lot of buzz” about India, concerns are being raised about the pace of the reform process and policy stability.
Jaitley will meet top CEOs and investors and address think-tanks during his visit. The Finance Minister also rang the closing bell at the New York Stock Exchange accompanied by India’s Ambassador to the US Arun Kumar Singh and Consul-General Dnyaneshwar Mulay.
Jaitley is accompanied by a high-level business delegation that includes Ambuja Neotia Group Chairman Harshavardhan Neotia; Apollo Tyres Chairman Onkar Kanwar; and Bharti Enterprises Vice-Chairman and Managing Director Rajan Bharti Mittal.
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3. Cisco to invest in India For Skill Development
US-based information technology company Cisco Systems on Thursday said it would invest $20 million (127 crore rupees), directly or indirectly, over the next five years in the ‘Cisco Networking Academy’ to train students.
The company will also spend $40 million (255 crore rupees) for the next phase of expansion in its India centres by March 2016.
Cisco spends around $1.7 billion every year in India, including $250 million on research and development.
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4. Rosneft-Essar stake talks hit hurdle
Russian oil firm Rosneft OAO’s talks with India’s Essar Group to buy a key stake in Essar Oil have slowed, people in know of the development told Mint, after the two sides clashed over the plant’s valuation.
As per reports, Rosneft is valuing the Vadinar refinery in Gujarat below $6 billion. After deducting the $1 billion loan extended by (Russian lender) VTB, Essar would be getting less than $2 billion.
While Essar reportedly wants a higher price. Mumbai-based Essar has been forced to consider selling off some of its assets to reduce its debt pile, after expanding in India and overseas in the last few years.
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5. RBL Bank set to file for IPO within a week, looks to raise Rs 1,450 crore
RBL Bank Ltd, a privately held lender backed by a clutch of private equity funds, is set to file its draft red herring prospectus (DRHP) with the markets regulator within a week. The IPO would help the bank comply with the Reserve Bank of India (RBI) guidelines issued last year that directed all banks to list within three years of starting busine
The bank is reportedly looking to raise Rs.1,450 through its initial public offering (IPO), of which Rs.1,100 crore will be raised to increase the capital adequacy ratio of the bank.
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6. Uber drivers are employees, not contractors, says California
A driver for Uber is an employee, not a contractor, according to a California ruling that could eventually push up costs for the ride hailing service and hurt its valuation.
Classifying Uber drivers as employees could mean considerably higher costs for the company, including social security, workers’ compensation and unemployment insurance. That in turn could affect its valuation, which is currently above $40 billion.
The ruling—which Uber insisted applied to only one driver—is the latest in a series of legal and regulatory challenges facing the company.
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7. IndiGo retains domestic market leadership
IndiGo, the Gurgaon-headquartered carrier clocked 38.9% market share in May, maintaining its lead over Jet Airways (18.3%), Air India (15.8%), SpiceJet (11.7%), and GoAir (8.6%).
In terms of passengers too, IndiGo was ahead of its competition with over 27.69 lakh passengers, while Jet Airways clocked the second-highest number at 13.01 lakh. The number of passengers carried by domestic airlines during January-May 2015 rose 21% over the previous year to 3.2 crore, according to DGCA.
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8. Indirect Transfer Woes for Foreign Investors
After the minimum alternate tax (MAT) issue, foreign portfolio investors are hit by a fresh problem. This time, rules governing indirect transfers are emerging as a cause for concern, especially for foreign portfolio investors running multi-billion-dollar India-focused funds.
Indirect transfer rules look to tax the transactions where foreign companies buy or sell their India assets. The government has taken the position that such indirect asset transfers are also to be taxed.
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9. After Foxconn, Taiwan’s Quanta weighs making in India
Taiwan’s Quanta Computer Inc, the world’s top contract personal computer manufacturer that makes laptops and assembles watches for Apple Inc, is considering establishing a manufacturing base in India, Quanta Vice-Chairman C C Leung told reporters after the company’s annual investor conference. At present, all of Quanta’s manufacturing facilities are in China.
Quanta’s move comes after rival Hon Hai Precision Industry Co Ltd, better known as Foxconn, announced it would likely plough billions of dollars into establishing 10 to 12 facilities in India by 2020.
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