OPINION, P8 COMPANIES, P6 SUNIL JAIN Huge gaps in 2G judgment offer lots of scope for review INTERNATIONAL, P16 SURJIT BHALLA CARMICHAEL MINE TRANSITION Don’t discount the big role high interest rates played in the Gujarat elections Adani to seek $2.3-billion debt for Australia coal plans Eric Schmidt to step down as Alphabet's executive chairman MUMBAI, SATURDAY, DECEMBER 23, 2017 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOLUME XXXXXV NO. 238, 28 PAGES, `8.00 P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E SENSEX: 33,940.30 ▲ 184.02 NIFTY: 10,493.00 ▲ 52.70 NIKKEI 225: 22,902.76 ▲ 36.66 HANG SENG: 29,578.01 ▲ 210.95 `/$: 64.05 ▲ 0.02 `/€: 75.89 ▲ 0.18 BRENT: $64.57 ▼ $0.33 GOLD: `28,686.00 ▲ `10.00 Intra-day, Dec 22 33,940.30 10,520 10,493 33,935 10,500 33,865 10,480 33,795 10,460 33,725 33,768.47 Prev. close: 33,756.28 Open Close 10,457.30 10,440 Open PRESS TRUST OF INDIA Mumbai, December 22 Prev. close: 10,440.30 Close UPI-e powering your transactions EARLY CHRISTMAS Benchmarks hit fresh peaks PRESS TRUST OF INDIA Mumbai, December 22 STOCK INDICES ON Friday closed on a merry note ahead of ChristmasasbenchmarksSensex andNiftyralliedtoall-timepeaks, with IT, technology and capital goods running the show. WhiletheSensexcamewithin the kissing distance of 34,000 points, the Nifty ended slightly short of 10,500. Intra-day, both scaled life highs. “Passage of US tax reform bill aimed at reducing corporate tax rates and strong US Q3 GDP growthledtherallyinglobalmarkets,which was extended to the domestic market and Niftyhit an all-time high 10,500 (during the day). The expectation of a good BudgetandstrongH2FY18earnings is supporting this rally,”said VinodNair,headofresearch,Geojit Financial Services. The 30-share BSE Sensex IN THE NEWS Air Deccan gets DGCA nod; ops begin today AVIATION REGULATOR Directorate General of Civil Aviation (DGCA) has granted a flying permit to Air Deccan, a move that will enable the airline to operate flights under regional connectivity scheme Udan, reports PTI. Air Deccan, which has bagged 34 routes in the first round of bidding for the scheme, has already announced the inaugural flight, which is set to take off for Jalgaon from Mumbai on Saturday. Special Features Dengue vaccine setback has wider ramifications The safety questions associated with Sanofi's Dengvaxia, that recently came to the fore, have raised the stakes for other vaccinecandidates, including one being developed by US NIH ■ Science & Tech, P15 QuickPicks Sebi conducts searches in WhatsApp leak case IN A major crackdown against leak of price sensitive information about listed firms, the Securities and Exchange Board of India (Sebi) on Friday conducted searches at premises of more than 30 market analysts and dealers and seized documents, computers, mobiles and laptops, reports PTI. The searches follow a probe into circulation of unpublished price-sensitive information about various listed companies, including some blue chips, through WhatsApp messages and social media chatrooms. The operations involved more than 70 Sebi officials, assisted by state police departments. This is one of the biggest operations since Sebi got search and seizure powers. PAGE 11 Wind tariff drops to new low of `2.43 per unit WIND POWER tariff dropped to an all-time low of `2.43 per unit in an auction conducted by Gujarat Urja Vikas Nigam (GUVNL) on Thursday, boosting clean energy initiatives of the country, reports PTI. "In an auction for 500 MWwind power capacities, the lowest tariff was quoted at `2.43 per unit by Sprng Energy and KP Energy," GUVNL MD Pankaj Joshi said. He added that Verdant Renewables, Betam Wind Energy and Powerica quoted tariff of `2.44 per unit each while Renew Energy quoted a tariff of `2.45. Joshi said when the bids were opened, the lowest tariff was `2.51, which dropped to `2.43 in reverse bidding conducted later. PAGE 2 Thyssenkrupp could halve stake in Tata Steel JV THYSSENKRUPP COULD halve its stake in a planned European steel joint venture with Tata Steel if they list it on the stock market by end-2024, a board member of the German industrial group said on Friday, report agencies. The two have committed to holding equal stakes for the first six years of the company’s existence, Thyssenkrupp personnel chief Oliver Burkhard told journalists on a call. In case of a stock market listing, they are to retain at least a 50.1% stake, he said, meaning Thyssenkrupp could reduce its stake to 25.05%. Thyssenkrupp a day earlier reached a deal with steel workers to secure jobs and plants, a key condition for the joint venture to go ahead next year. PAGE 6 IT, technology and capital goods stocks take Sensex and Nifty to new intra-day highs, markets post third weekly gains opened on a strong footing at 33,768.47 points and hit a fresh intra-day high of 33,964.28. It ended at 33,940.30, a new closing, up 184.02 points, or 0.55%. The previous closing record was on December19when it had finishedat33,836.74.Theindexhad lost 80 points in the previous two sessions. ForthebroaderNifty,theclose cameatafreshpeakof10,493,up 52.70 points, or 0.5%, breaking its previous record of 10,463.20 hit on December 19. Forthethirdstraightweek,the Sensex advanced, notching up a significant 477.33 points, or 1.42%.The Nifty was up 159.75 points,or1.54%,duringtheweek. IT was a clear winner of the day, riding on a big order win by Tata Consultancy Services. Soft crude prices and a strong rupee gave fodder to bulls. Finance ministerArun Jaitley saidintheLokSabhathataccording to the NITIAayog,the revised projection for investment in infrastructure in 2012-17 is `38,22,822 crore, which is 1.6 times the investment of `23,77,746 crore achieved in 2007-12 at current prices. The rupee soaring to an over fresh three-month high against the dollar fuelled the rally. The stock exchanges will remain closed on Monday for Christmas. Govt, RBI deny any bank faces closure HC nixes nod to try Chavan Intra-day, Dec 22 34,005 PROMPT CORRECTIVE ACTION ● ADARSH CASE Nifty 50 Broader markets stood out as themid-capindexmaintainedan upward trend for the seventh straight session and finished at a record by gaining 0.11%. The small-cap index was also on the rise for the sixth session, beating the Sensex with a gain of 0.58%. ONGC was the leader of the Sensex ring, with a 2.87% rise, followedbyTCSandInfosys.Bajaj Auto, Bharti Airtel, Wipro, State Bank of India and Larsen & Toubro rallied by up to 1.24%. The IT index was in the big league, up 1.31%. Technology surged 1.02%,alongwith capital goods and infrastructure. Domestic institutional investors were net buyers as they bought shares worth `1,574.30 crore on Thursday while foreign portfolio investors offloaded equities amounting to `383.99 crore,provisional data showed. Asian shares ruled firm during the day. No question of closing down any bank. Govt is strengthening PSBs by `2.11 lakh crore recapitalisation plan THE BOMBAY HIGH COURT on Friday set aside the sanction granted to the Central Bureau of Investigation by Maharashtra governor C Vidyasagar Rao to prosecute seniorCongress leader Ashok Chavan in the Adarsh housing society scam. A division bench of justices Ranjit More and Sadhana Jadhav ruled that though the CBI had claimed to be in possession of fresh evidence against Chavan at the time of seeking the sanction, it “failed to present any fresh evidence”. The bench said the material presented by the CBI before Rao could not be converted into credible fresh evidence against Chavan. “The sanctioning authorityis an independent body that can't allow itself to be influenced by anyone’s opinion,”the court said. The bench was hearing a petition filed by Chavan challenging the sanction granted by the governor in February 2016 to prosecute the former chief minister of Maharashtra undervarious sections of the Indian Penal Code related to criminal conspiracy and cheating, besides provisions of the Prevention of Corruption Act. Chavan had challenged Rao's order in the high court, calling it “arbitrary, illegal and unjust” and passed with “mala fide intentions”. — RAJEEV KUMAR FINANCIAL SERVICES SECRETARY PCA framework is intended to encourage banks to eschew certain riskier activities...so that their balance sheets can become stronger. — RBI STATEMENT FE BUREAU New Delhi, December 22 THE GOVERNMENT AND the Reserve Bank of India (RBI) on Friday moved swiftly to scotch rumours of the closure of any public sectorbank (PSB),with the finance ministry stressing capital infusion and other reform measures for the state-run banks are“firmly on track”. Earlier this week, the central bank put a large lender like Bank of India (BoI) under prompt corrective action (PCA), citing high bad debt and low tier-1 capital, and imposed fresh curbs on United Bank of India (UBI), which was the first to go under PCA three years ago. These moves stoked speculations that some PSBs maybe forced to shut down. Adding to concerns, the International Monetary Fund Continued on Page 2 E-KYC NORMS SUSPENSION SRA AMENDMENT Airtel bank arm CEO Arora quits Centre moves to remove a massive infra roadblock FE BUREAU New Delhi, December 22 FE BUREAU Mumbai, December 22 AIRTEL PAYMENTS BANK managing director and CEO Shashi Arora has resigned in thewake of the firm’s e-KYC licence suspension by Unique Identity Authority of India (UIDAI). “Shashi has decided to move on to pursue opportunities outside ofAirtel.Wewish Shashi the very best for his future endeavours,” the company said in a statement on Friday. The UIDAI had last week barred Bharti Airtel and Airtel Payments Bank from conducting Aadhaar-based verification of customers using the e-KYC process. The action was taken following allegations that Bharti Airtel was using the Aadhaar eKYC-based SIM verification process to open payments bank accounts of its subscribers without their informed consent. However,onThursdayUIDAI allowed Bharti Airtel to use Aadhaarforre-verification of its mo- INFRASTRUCTURE DEVELOPERS HAVE got some cheer by way of the government’s move to remove impediments to project execution.They believe the proposed amendments to the Specific Relief Act, 1963, (SRA) introduced in Parliament on Friday, which look to prevent infrastructure projects getting tangled up in legal disputes, are developer-friendly and will enable timely completion of projects, while giving confidence to investors in infrastructure projects. Satish Parakh,managing director, Ashoka Buildcon, said, “The government is definitely trying to remove hurdles and push stuck projects out of the rut. If the government is taking steps to restrict people from unnecessarily approaching courts, it is extremely positive for the sector. Projects will get completed within prescribed Shashi Arora, outgoing MD & CEO, Airtel Payments Bank bile customers till January 10 with stiff riders after it returned `138 crore of LPG subsidy remitted to the unsolicited payments bank accounts. However, UIDAI maintained that Airtel Payments Bank e-KYC licencewill remain suspended till thefinalenquiryandauditreport. Continued on Page 2 and the RBI on Thursday flagged,in separate reports,persistent risks to the banking system due to huge bad loans. Financial services secretary Rajeev Kumar tweeted on Friday: “No question of closing down any bank.Govt is strengthening PSBs by `2.11 lakh crore recapitalisation plan.Do not believe rumour mongers. Recap, Reforms roadmapforPSBsfirmlyontrack.” In a statement, the RBI also dismissed “misinformed communication” circulating in sections of media, including social media,about the closure of some PSBs in the wake of their being placed under PCA. Earlier, the RBI also initiated PCAagainstotherPSBs,including IDBIBank,IndianOverseasBank, UCO Bank and Central Bank. Continued on Page 2 ● PACT RENEWED were beyond the control of even the government. With this, construction of projects will get expedited.” His sentiments were echoed by Jayant Mhaiskar,vice-chairman and MD, MEP Infrastructure: “It is a welcome move in terms of speeding up the process on account of the government’s ambitious Bharatmala project. This much awaited move will help the government keep costs of the project at predetermined numbers. It will speed up projects and the risk of projects being halted will be low.” Some of the key proposals in this are a provision to ensure injunctions are not granted for infrastructure projects that could delay their execution, special courts are set up for such cases, suits are expeditiously disposed of within a specific time frame and substitution is allowed in performance of contracts. Implications of the proposed amendments ■ Injunctions that delay infra projects not to be granted ■ Special courts to be set up in states for such suits ■ Suits to be disposed of in 12 months, with max 6-month extension ■ Non-performing contract party may be substituted ■ Compensation may be recovered from nonperforming party time limits, because the contracting fraternity in India today is well equipped to complete projects on time. The obstacles we faced resulted in delays, and many a time these Continued on Page 2 TCS wins $2.25-bn Nielsen deal FE BUREAU Bengaluru, December 22 TATACONSULTANCYSERVICES (TCS) has bagged a fresh $2.25billion contract from its existing customer, global TV rating measurementcompanyNielsen,making it one of the largest ever such deal forthe Indian ITindustry. TCS’relationshipwithNielsen began in 2007 with a 10-year, $1.2-billion contract which was further extended to 2020 taking the totalvalue to $2.5 billion. A filing with the SEC said, “Nielsen has committed to purchase services from TCS from the Effective Date through the remaining term of the Agreement (the‘Minimum Commitment’) in the amount of $2.25 billion, in- Large deals bagged by TCS ($ billion) Tenure Pearl Group (2005) 0.847 12 yrs Citi (2008) 2.5 HEAD START Year-end sales kick-off early, discounts to get deeper ANUSHREE BHATTACHARYYA & JHARNA MAZUMDAR New Delhi/Mumbai, December 22 AS 2017 HEADS to a close,brickand-mortar retailers and online e-tailers have lined up an arrayof discounts. In fact, the end-ofseason sale,an annual affairthat usually begins after December 25, has kicked off well before Christmas this year.Industryinsiders claim this is because the festive season sales didn’t deliver to expectations, especially for etailers. Pantaloons, Louis Philippe, Aldo, Vero Moda, Hennes & Mauritz (H&M), Only, Globus, Benetton, Lifestyle and Shoppers Stop,alongwith online fashion portals like Myntra, 9.5 yrs Friends Life (2011) Jabong andAmazon Fashion,are currently offering discounts ranging between 20% and 40% on a range of merchandise. The discounts are expected to increase even furtherto as much as Let’s deal 60-70% before the end of January,which has traditionallybeen the discount sales period. “With e-tailers advancing theirend of season sale thisyear, offline players too have started 20% offering discounts. In terms of business, we expect a 20% growth in sales in the third quartercompared to the same period last year,” said Vasanth Kumar, executive director,Max Fashion, 30% 50% OFF ILLUSTRATION: SHYAM JAPAN S&P BSE SENSEX 2.2 15 yrs part of the Dubai-based Landmark Group. Harkirat Singh, MD, Woodland, too is bullish about the prospects in the rest of the year. Though the fashion and lifestyle brand has been able to achieve its sales target for 2017, it has been a challenging year for the company.“After two slow quarters on the back demonetisation and GST(goods and services tax), the market grew exponentially in the third quarter in terms of sales. The fourth quarter too is expected to be good,”said Harkirat.Woodland,which announced its end-of-season sale from December16,is offering a flat 35% off on all products. cluding a commitment to purchaseatleast$320millioninservices peryearfrom 2017 through 2020,$186millioninservicesper year from 2021 through 2024, and $139.5 million in services in 2025.” Thisfresh$2.25-billiondollar contract comes as a big boost for TCS as it growth has slipped into single digits and sets up a strong base forthe comingyears. TheNielsenfilingalsosaid,“In connectionwiththeentryintothe agreement, the parties have agreed to terminate the separate global infrastructure services agreements between them as of the effective date and include the servicesprovidedthereunderinor more statements of work arising underthe agreement.” Continued on Page 2 Continued on Page 2
The Financial Express (FE) is a business paper that’s closest to the people who are in the business of business. From business policies to market trends to new developments, The Financial Express comes packed with incisive news on every relevant issue.