OPINION, P8 COMPANIES, P6 INDRANIL SEN GUPTA OMOs of `500bn will supply liquidity & reassure markets INTERNATIONAL, P16 SHOBHANA SUBRAMANIAN TATA SONS CHAIRMANSHIP HEALTH DRIVE Time to be bold — cut taxes, ease labour laws, spend more, sell more PSU stocks to part-fund this Mistry removed as board had lost confidence in him, says Singhvi Schneider-led Nestle sells US candy biz to Ferrero for $2.8 billion KOLKATA, THURSDAY, JANUARY 18, 2018 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM VOLUME XXVII NO. 68, 20 PAGES, `5.00 (NORTH EAST STATES & ANDAMAN `10.00) P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E READ TO LEAD SENSEX: 35,081.82 ▲ 310.77 NIFTY: 10,788.55 ▲ 88.10 NIKKEI 225: 23,868.34 ▼ 83.47 HANG SENG: 31,983.41 ▲ 78.66 `/$: 63.89 ▲ 0.15 `/€: 78.06 ▲ 0.17 BRENT: $68.92 ▼ $0.23 GOLD: `30,094.00 ▲ `38.00 PUBLIC FINANCES ● IMMIGRATION Bonds rally after govt says it will borrow less AFTER SELLING OFF sharply on Tuesday, bonds rallied on Wednesday after the governmentsaiditwouldborrowonly an additional `20,000 crore and not `50,000 crore in 2017-18. Economic affairs secretary Subhash Chandra Garg said in a tweet: “Government has reassessed additional borrowing requirements taking note of revenue receipts and expenditure pattern. Requirement of additional borrowing being reduced from `50,000 crore as notified earlier to `20,000 crore.” The bond markets may have rallied but the lower borrowings have been interpreted as a sign the government will scale back spending in Q4FY18. Garg, however, didn’t elaborate on whether the reduction in the additional borrowing was due to any spending cuts or a likely jump in revenue mop-up, or if the government would tap the short-term Treasury-bill window more aggressivelyto fund fiscal deficit. The yield on the new Old benchmark yield (%) 7.40 7.60 7.383 7.35 7.30 7.552 7.55 7.50 7.272 7.25 7.20 7.45 7.223 15 7.40 16 17 Jan 2018 7.443 7.415 15 16 17 Jan 2018 Source: Bloomberg Government has reassessed additional borrowing requirements taking note of revenue receipts and expenditure pattern. Requirement of additional borrowing being reduced from `50,000 crore as notified earlier to `20,000 crore — SUBHASH GARG ECONOMIC AFFAIRS SECY benchmark fell all the way to 7.205% beforeclosingthesession at 7.22%, 16 basis points down overTuesday’s close.The yield on old benchmark hit a low of 7.35% before closing the session 13 basis points down at 7.42% —the lowestin a week. Later in a statement, the finance ministry said the government did not accept borrowings of `15,000 crore in the last three auctions. The remaining `15,000 crore, it said, would be cut in the coming weeks from the borrowing programme notified earlier. The central bank has, in the past one month, twice deferred a part of the bond auctions. In late December, it did not accept any bids for two sets of gilts worth `11,000 crore; only `4,000 crore of supply hit the market. In the first week of January, the RBI did not acceptbidsfortwolongdated papers worth `4,000 crore. THETRUMPADMINISTRATION wantstoadmitimmigrantswho have skills,talent and can speak English, a top official has said, givinginsightintotheproposed merit-based system that may benefit individuals from countries like India. PresidentDonaldTrumphas been pushing for the meritbased immigration system to reduce overall immigration to the US. A merit-based immigration system,theTrump administration feels,would admit the best and the brightest around the worldwhilemakingitharderfor people to come to the country illegally. The president also wants to scrap diversity lottery visa and chain migration to reform the current system. “Andso,ourpositionisthata system that prioritises individuals based on their individual skills and merit will certainly produce better results than the system we have now,” a senior administration official said on condition of anonymity. Continued on Page 2 Celebrations outside the BSE in Mumbai on Wednesday Sensex races past 35,000-mark Government’s announcement on borrowing provides boost; bank, IT stocks lead surge S&P BSE SENSEX 34,000 33,000 32,000 30,133.35 31,000 30,000 PRESS TRUST OF INDIA Mumbai, January 17 29,000 THE BSE SENSEX soared 310 points on Wednesday to close above the 35,000 level for the first time ever after the government lowered additional borrowing requirement for this fiscal, calming widening fiscal deficit fears. April 26, 2017 The wider Nifty too finished at a fresh life-time high on unabated buying. Banking stocks ratcheted upaftertheCentreonWednesday lowered the additional Continued on Page 2 Summary returns (GSTR-3B) Composition scheme returns Sales returns (GSTR-1) Grab acquires Indian payments start-up iKaaz AS PART of its strategy to enter the electric commercial vehicles (CVs) segment, Hinduja group flagship Ashok Leyland has signed a letter of intent with Israel-based Phinergy for its electric commercial vehicles segment, reports fe Bureau in Chennai. Both companies will work towards the adaptation of unique, competitive and sustainable solutions for high-energy applications in the commercial vehicles space. PAGE 6 84 Continued on Page 2 Continued on Page 2 47 lakh* *filed between Jan 3-10; 200-240 lakh returns needed to be filed FE BUREAU New Delhi, January 17 COMPLIANCELEVELFORGST invoice-levelfilingscontinuesto be low despite several extensions and,in all probability,are just over 30% right now.In the case of summary returns,however, compliance levels have beenhigherataround65-70%. Detailedinvoice-levelfilings are important because it is only after these details are available that GST authorities can check the levels of tax evasion.While thebreak-evenGSTcollectionis likely to be in the range of Israeli Prime Minister Benjamin Netanyahu spins cotton on a wheel as his wife Sara looks on during their visit to Ahmedabad on Wednesday Report on Page 3 `95,000-1,00,000 crore per month,in April-November collectionshaveaveraged`87,000 — after `92,000 crore for July, collectionsfellto`81,000crore forNovember. While therewere around 60 lakhfirmsregisteredunderGST in July, this rose to 84 lakh by November. In addition, the numberoffirmsunderthecomposition scheme — these firms need to pay just a 1% GST levy on sales and file quarterlysummaryreturns—rosefrom5lakh to16lakhoverthesameperiod. Continued on Page 2 ● Q3 EARNINGS HUL beats estimates, net up 30% FE BUREAU Mumbai, January 17 HINDUSTANUNILEVER(HUL), the country’s largest consumer goods company,on Wednesday reporteda30%increaseinprofits before exceptional items of `1,198 crore, a tad better than analysts’ estimates by Bloombergof`1,173crore,during the October-December quarter. This was achieved on the back of volume growth of 11% across segments. Profit after tax, if one includes the (` cr) Q3FY18 Q3FY18 % growth Net sales Ebitda Net profit 2.44 24 28 « Ashok Leyland, Israeli firm to partner for electric CVs 6 (July-Sept) « INDIAWILL on Thursday put on auction 55 exploration blocks in the first bid round in eight years, which will offer a record area for the prospecting of oil and gas, the head of the country's upstream regulator said, reports PTI. This will be the first auction under the new Hydrocarbon Exploration and Licensing Policy that allows companies to carve out blocks of their choice, with a view to bringing about 2.8 million sq km of unexplored area in the country under exploration. exceptional items, stood at `1,326 crore, up 28% compared to theyear-ago period. Revenues during the period rose 17% forthe domestic consumer businesses, though the reported total revenue growth was just 2%.This was because the revenues for the corresponding period were reported inclusiveofexciseasperregulatory requirements, while the revenues for the December 2017 quarterwere net of GST. FOLLOWINGAPOSITIVEviability assessment report for Jindal Steel & Power (JSPL), lenders have sought the Reserve Bank of India’s (RBI) permission to allow them to upgrade the company’s loan account to standard from its current non-performing asset (NPA) category, bankers told FE. If granted, this would lead to reversal of provisions made bybanksfollowingtheaccount turning NPA.UnderRBI guidelines, lenders need to set aside at least 15% of the outstanding loans as provisions for a bad loan; for a standard loan, the provision is 0.4%. The company’s gross debt stood at `38,704 crore in the September quarter of FY18,according to Bloomberg. It reported a net loss of `255 crore on revenues of `3,668 crore in the same quarter. According to lenders, expansion of the company’s Angulplantislargelycomplete and the steelmaker has regularised repayments.“JSPL had to complete a blast furnace in the project and the company has achieved it,”a seniorpublic sector banker said. The Gandhi experience « Govt to put on auction 55 oil, gas blocks for exploration today 16 60/month « SOUTHEASTASIAN ride-hailing company Grab, which has clocked over a billion rides, on Wednesday announced the acquisition of Bengaluru-based payments solution provider iKaaz for an undisclosed amount, reports fe Bureau in Bengaluru. With the acquisition, the Singapore-based company plans to strengthen its mobile payments platform. According to a press release from Grab, the move will also help it to strengthen its R&D centre in India. PAGE 6 84 CRYPTOCURRENCY SLIDE Bitcoin slumps to $10,000, half its peak price, as regulatory fears grow REUTERS London/Tokyo, January 17 BITCOIN SKIDDED A further 12% on Wednesday, marking an almost halving in value from its peak price, with investors spooked byfears regulators could clamp down on the volatile cryptocurrency that skyrocketed last year. The price of bitcoin, the world’s biggest and best known cryptocurrency, fell to aslowas $10,0000 on the Luxembourg-based Bitstamp exchange, the lowest since December 1. Bitcoin touched a peak of almost $20,000 in December —andindeedcrossedoverthat threshold on some exchanges — but has since been roiled by several large sell-offs. Other cryptocurrencies plunged aswell.Ethereum and Ripplewere both down heavily after reports South Korea and ILLUSTRATION: ROHNIT PHORE QuickPicks (in lakh) Assessees Returns Continued on Page 2 FE BUREAU Mumbai, January 17 Compliance falls for invoice returns Going Slow on Taxes borrowingrequirementforthe current fiscal to `20,000 crore from `50,000 crore estimated earlier. Banks seek RBI nod to upgrade JSPL a/c to standard 1,326 From futuristic television sets to self-driving cars to robots that can emote, there was nothing that didn’t surprise at the world’s largest tech show held in Las Vegas ■ Gadgets, P15 Jan 17, 2018 ● VIABILITY REPORT 1,038 Notes from CES 2018: Voice is the new touch 35,081.82 35,000 GST Special Feature EXPRESS PHOTO: DILIP KAGDA MARKETS AT NEW HIGHS 1,680 STATE BANK of India on Wednesday said its board has given its nod for the raising of `20,000 crore for financing affordable housing and infrastructure projects through long-term bonds, the bank said in a BSE filing, reports PTI. The bank did not specify whether the borrowing would be in rupee denomination or foreign currency. FE BUREAU Mumbai/New Delhi, January 17 New benchmark yield (%) 1,355 SBI gets board nod to raise `20,000 crore PRESS TRUST OF INDIA Washington, January 17 VIRAL FEVER SUBSIDES 8,323 DIRECT TAX collections during the first nine-and-ahalf months of the current fiscal have risen by 18.7% to `6.89 lakh crore, the tax department said on Wednesday, reports PTI. The collections till January 15, 2018 represent over 70% of the `9.8 lakh crore revenue target from direct taxes, the Central Board of Direct Taxes (CBDT) said in a statement. Gross collections (before adjusting for refunds) have increased by 13.5% to `8.11 lakh crore during April, 2017 to January 15, 2018. The lower mop-up is being viewed by bond markets as a sign the govt may scale back spending in Q4FY18 8,124 IN THE NEWS FY18 direct tax mop-up rises 18.7% till Jan 15 Trump’s policy likely to benefit Indians China could ban cryptocurrencytrading,sparkingworries of a wider regulatory crackdown. “Thereisalotofpanicinthe market. People are selling to try and get the hell out of there,” said Charles Hayter, founder of Cryptocompare, which owns cryptocurrencies. “You have more regulatory uncertainty...and because of thesefallsyouhavetheseother outfalls,” he said, referring to the collapse of some cryptocurrencies in the recent slump in prices. With South Korea, Japan and China all making noises about a regulatory swoop, and officials in France and the United States vowing to investigate cryptocurrencies, there are concerns that global coordination on how to regulate them will accelerate. Continued on Page 2
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