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APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOLUME XXXXXV NO. 265, 30 PAGES, `6.00 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: 36,139.98 ▲ 341.97 NIFTY: 11,083.70 ▲ 117.50 NIKKEI 225: 24,124.15 ▲ 307.82 HANG SENG: 32,930.70 ▲ 537.29 `/$: 63.78 ▲ 0.09 `/€: 78.12 ▲ 0.17 BRENT: $69.65 ▲ $0.62 GOLD: `30,058.00 ▲ `93.00 ADDRESS AT WEF ● PRICE WAR PM warns of rising protectionism Jio cuts tariffs by `50, raises data limit by 500 MB/day FE BUREAU New Delhi, January 23 Telcos discuss rationalisation of levies with Trai THE TELECOM REGULATORY Authority of India had a brainstorming session with telcos on Tuesday, reports fe Bureau in New Delhi. Telcos urged that Trai should look into rationalisation of levies like spectrum usage charge and licence fee, pain points in infrastructure expansion, regulation of OTT players, among others. Trai asked the telcos to submit more inputs on the issues concerned so that it can float a consultation paper on the same. NEW OFFER Prime Minister Narendra Modi at the opening plenary during the World Economic Forum annual meeting, in Davos, Switzerland, on Tuesday Denounces forces that hinder ‘natural flow of globalisation’ MODISPEAK SHAJI VIKRAMAN Davos, January 23 ■ Climate change, ■ Many countries are becoming inwardfocused and globalisation is losing lustre MAKING OUTA case for eliminating rifts and differences to build a newworld order,Prime Minister Narendra Modi on Tuesday flagged the rising threat of protectionism with a newlayerof tariff and non-tariff barriers being erected and countries increasingly focusing inwards. Speaking at the plenary of World Economic Forum in his first visit to Davos, and the first by an Indian Prime Minister in 20 years, Modi also pitched India as an investment destination, emphasis- terrorism and trade protectionism are three major challenges ■ Inclusive develop- ment is key to India’s programmes, be it Jan Dhan or DBT ing on efforts to improve ease of doing business. “Wehavemadeitsoeasierto invest in India,manufacture in IndiaandworkinIndia.Wehave decided to uproot licence and permitRaj.Wearereplacingred tapewith red carpet,” he said. In the global context,Modi said that bilateral negotiations havevirtuallycome to a standstill because of the new trade barriers. “We have to accept that globalisation is losing lustre with the intention being to reverse the natural flow of globalisation, and forces of protectionism are raising their heads again,” he said in a keynote address on the opening day of the WEF. Modi’s remarks come just a coupleofdaysbeforePresident Donald Trump’s scheduled appearance here, with the US pushing hard forAmerica First economic and foreign policies. Lastmonth,criticismbytheUS oftherules-based,multilateral trading system that the World TradeOrganization(WTO)represents resulted in a stalemate of the bi-annual ministerial conference of the trade body. Continued on Page 2 Related reports on Page 6 CORPORATE BONDS Special Feature Yields soar 100 bps in little over one month Why asset allocation holds the key to wealth creation In times of uncertainty and a looming election year, go for a customised Investment Policy Statement. Alternatively, follow the three bucket strategy ■ Personal Finance, P15 FIMMDA Corp Bond curve AAA 10-year (%) 7.9396 8.200 8.000 Sept 29, 2017 Jan 22, 2018 MONEY IS BECOMING costlier. On Tuesday, two large private banks priced a `7,000-crore one-year certificate of deposit (CD) issue at 7.45-7.55%. With this, yields in the corporate bond market have effectively shot up about 100 basis points (bps) in a little over a month. According to market participants, the prevailing rate on AS THE Centre prepares for an unprecedented level of capital infusion into public-sector banks through bonds, it is considering stricter official monitoring of the performance goals for each of the banks that will receive the funds, reports Banikinkar Pattanayak in New Delhi. Major deviations from the performance commitments by a PSB could invite penal action, including halting of further infusion. Even finance minister Arun Jaitley cautioned PSBs earlier this month that their perfomance would be under test in the coming years. PAGE 2 7.253 7.450 6.663 6.700 SHRITAMA BOSE Mumbai, January 23 Capital infusion: Govt to step up vigil on PSBs’ performance (%) 6.950 7.600 QuickPick 10-year bond yield 7.200 7.800 7.5383 7.400 6.450 Sept 29, 2017 Jan 23, 2018 one-year CDs in early December was 6.6-6.7%. For perspective, State Bank of India’s MCLR or the marginal cost of fund-based lending rate,foroneyear,is 7.95%. The yield on the Fixed Income Money Market and Derivatives Association (FIMMDA) 10-year benchmark for AAA-rated corporates has shot up 40 basis points (bps) since the end of September 2017. Continued on Page 2 Landless cultivators to be ‘farmers’ too Change of definition to extend assorted benefits to 14 crore currently excluded PRABHUDATTA MISHRA New Delhi, January 23 OVER 14 CRORE households whocultivateonlandownedby others under a formal lease agreementorevenunderatemporary arrangement overseen bythegrampanchayatsorother official functionaries may soon startgettingassortedsopsdoled 0 RELIANCE JIO ON Tuesday once again ambushed incumbents on the tariff front by unveiling a Republic Dayoffer which has slashed rates on its packages by `50 while increasing per day data limit by 500 MB. This comes after its 100% cash back offer, which was announced on January 16. With these tariff packages,Jio has further increased the gap between its offers and those of incumbents which had been reducing before it. IN THE NEWS Bank of Baroda set to float $1-billion QIP STATE-RUN LENDER BANK of Baroda is expected to float its $1-billion qualified institutional placement (QIP) of shares in the next two to three weeks, report Shamik Paul & Sundar Sethuraman in Mumbai. In November last year, the Mumbai-based bank's board had approved a proposal to raise an additional equity capital through a rights issue or QIP. Most of the large PSBs have been tapping the equity market to raise funds. The country's largest lender, State Bank of India, completed its QIP of `15,000 crore in June 2017. Most valued companies by m-cap 26.3 cr Number of households reliant on farming according to 2011 census 14.43 cr ‘Landless’ cultivator households out to“farmers”by the government just as their land-owing counterparts do.According to officialsources,thedefinitionof farmer will be changed via a gazzette notification to include cultivators who don't own the 22.5% Farmers below poverty line farm land being used by them, on the lines of the recommendationsmadebytheAshokDalwai Committee recently. The panel had, in a report submitted to the government last year, recommended dou- bling of farmers’ income by 2022, a “one-India farm market”andgreaterparticipationof the private sector in agri-marketing and logistics, among others. In the latest volume of its report given to the agriculture ministry, the panel said without the proposed definitional change thatwould make landless farmers eligible for benefits,“the objectives of the government intervention, which are all meant to improve the status of agriculture in the country may not be equitable and inclusive”. Continued on Page 2 Old plan New plan PRICE (`) 399 349 DATA LIMIT (GB/DAY) 1 1.5 VALIDITY (DAYS) 70 70 Continued on Page 2 YTD gain (%) Market cap (` lakh crore) 8 20 14.9 6.6 4.1 5 2 6.22 RIL 5.94 5.05 3.37 3.01 TCS HDFC Bank ITC HDFC 15 35,600 34,900 5 10 36,139.98 36,300 10 6 4 S&P BSE SENSEX 34,200 0 33,500 33,812.75 Jan 1, 2018 Jan 23, 2018 SENSEX CROSSES 36,000 India most expensive market as m-cap nudges $1 trillion Trading at price-to-earnings multiple of 19.3 times, index is ahead of Dow’s 18.12 YOOSEF KP Mumbai, January 23 WITH THE SENSEX scaling yet another peak to hit 36,139.98 on Tuesday, India remains the world’s most expensive majormarket,tradingatapriceto-earnings multiple of 19.3 times one-year estimated forward earnings.While the Dow Jones trades at 18.12 times,the JakartaCompositetradesat17.0 times, data from Bloomberg shows. The market capitalisation of the Sensex hit `63.42 lakh crore or $994 billion. RelianceIndustries’(RIL)m-cap touched `6.22 lakh crore or $97.5 billion onTuesday. The markets have been drivenupbytheabundanceofliquidity — in 2017, foreign investors bought stocks worth $8.01 billion while local institutions shopped for equities worth$13.63billion,thehighestinanyyear.InJanuarysofar, however,while foreign buying is nudging $1.2 billion, local funds have been restrained their purchases with a tab of just $72 million. Thereasonfortheoptimism, fund managers point out,is the revival in corporate earnings, partlydrivenbythelowbaseand an improvement in the economy. Due to the twin disruptionsfromdemonetisationand the GST, corporate earnings so far this fiscal have been subdued.However,withtheimpact of these events now fading, India Inc is expected to report a much betterperformance. EarningsfortheSensexsetof companies are expected to be reasonably good growing at around 15% y-o-y in Q3FY18, albeit on a very low base when earnings barely grew by 1%; in Q2,therisewas9%y-o-y.Kotak Institutional Equities estimate the earnings for the Sensex set of companies will grow to `1,825 for FY19 from `1,480 for FY18, or a growth of 23%. Marketobserverspointouthow ahandfulofstocksisdrivingup the index. For instance, in the latest 1,000 points rally, about 500 points have been contributed by three stocks — RIL, HDFC Bank and ICICI Bank.
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