OPINION, P8 INTERNATIONAL, P14 SOLID iPHONE SALES EDITORIAL Little done to fix issues, what use is a new telecom policy? Queries from potential buyers for AI show they want more than what is on offer INTERNATIONAL, P14 PLAYING CUPID Cook-led Apple announces buyback of $100 billion Zuckerberg unveils plans for Facebook dating service NEW DELHI, THURSDAY, MAY 3, 2018 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL.XLIV NO. 53, 20 PAGES, `6.00 (PATNA `6.00, RAIPUR `7.00) P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E SENSEX: 35,176.42 ▲ 16.06 NIFTY: 10,718.05 ▼ 21.30 NIKKEI 225: 22,472.78 ▼ 35.25 HANG SENG: 30,723.88 ▼ 84.57 `/$: 66.67 < > 0.00 `/€: 79.98 ▲ 0.56 BRENT: $72.77 ▼ $0.36 GOLD: `30,918.00 ▼ `115.00 — E-COMM BUZZ RACE FOR BINANI CEMENT Consider UltraTech’s new bid: NCLT to CoC IN THE NEWS Spot power price rises 44% to `3.98 per unit in April AVERAGE SPOT POWER price rose 44% to `3.98 per unit in April compared with `2.77 a year ago, mainly due to higher demand, seasonal variations and coal shortage, reports PTI. “The average market clearing price (MCP) at `3.98 per unit saw a decline of 1% over `4.02 per unit in March 2018 and 44% above `2.77 per unit a year ago,” an IEX statement said, adding the main reasons for high prices were rise in demand, seasonal variation and coal shortage. J Dey killing: Chhota Rajan, 8 others get life NEARLY SEVEN YEARS after senior journalist J Dey was shot dead, a special court on Wednesday awarded life imprisonment to all the nine convicted, including gangster Chhota Rajan, reports PTI. The court, however, acquitted former journalist Jigna Vora, who was charged with instigating Rajan to carry out the killing in 2011. Another accused Paulson Joseph was also acquitted. A fine of `26 lakh each was also imposed on the convicts. Brings UltraTech back in contention; court also allows rival Dalmia Bharat to improve on its own offer July 25, 2017: NCLT, Kolkata, admitted insolvency petition against Binani Cement filed by by Bank of Baroda February 27, 2018: Committee of creditors declared Dalmia Bharat as as highest bidder March 8: UltraTech Cement said it has submitted a revised bid for Binani Cement TORTUOUS ROUTE March 14: CoC approved Dalmia Bharat's `6,600 crore resolution plan MITHUN DASGUPTA Kolkata, May 2 BRINGING ULTRATECH BACK in the race for Binani Cement,the National Company Law Tribunal (NCLT) on Wednesdayaskedtheresolution professional (RP) and the committeeofcreditors(CoC)toconsider the revised offer from the country’slargestcementmaker. The decision is important since the Supreme Court had on April 13 been unwilling to interfere in the Insolvencyand Bankruptcy Code (IBC) proceedings, following which Binani Industries (BIL) withdrew its appeal for an out-ofcourt settlement forthe sale of its subsidiary Binani Cement. The judges were upset with BIL's attempt to withdraw the saleofBinaniCementfromthe purviewoftheIBC.BIL'sappeal in the SC had been prompted by an offer it received from UltraTech Cement to buy a 98.43% stake in Binani Cement for `7,266 crore provided the resolution process underthe IBCwas terminated. The direction bythe NCLTis also significant because other benches might consider allowing bids that have been revised orsubmittedlate.ThefinaldecisiononBinaniCement,itwould appear,nowrestswith the CoC. The bench, however, March 19: UltraTech inks pact to buy 98.47% of Binani for `7,266 crore in out-of-court settlement March 27: Binani Industries moved tribunal seeking termination of insolvency proceedings against Binani Cement April 13:With Supreme Court refusing to interfere in IBC proceedings, Binani Industries withdrew out-of-tribunal settlement May 2: NCLT order announced April 15: UltraTech Cement improved its bid to `7,960 crore offered Dalmia Bharat-controlled Rajputana Properties (RPPL) a chance to better its offer of `6,930 crore. This bid, which includes infusion ofworking capital and capex,was declared the highest bid(H1)onFebruary27.UltraTech Cement had improved its offertoabout`7,900crore,after submittinganearlierrevisedbid of over `7,200 crore to the RP, VijaykumarV Iyer, on March 8. UltraTechhadclaimedthatnegative points had been wrongly assignedtoitsbid,makingitthe H2 and not H1 bidder. JusticesJinanKRandMadan BalachandraGosaviobservedin theirorderonWednesday:“It is made clear that if both resolu- tion applicants are willing to participate in the bidding process, CoC is expected to allow both resolution applicants in the bidding process” and gowith the bidder“best for revival of the corporate debtor as decided bythe CoC”. Binani Cement has a manufacturingcapacityof11.25million tonnes of cement per year with integrated plants in India andChina,andgrindingunitsin Dubai.As per details on Binani Cement’s website, financial creditors of the company had claimed `6,470.26 crore,while the NCLT had admitted claims worth `6,469.36 crore. Continued on Page 2 ACTION MODE Special Feature Look at AI to rebalance the cyber criminal advantage Businesses need to leverage Artificial Intelligence and Big Data to identify, withstand and respond to cyber security threats, says Fortinet’s Rajesh Maurya ■ eFE, P13 QuickPicks Telcos add record 21.9 million subscribers in March; Idea tops TELECOM OPERATORS added a record 21.9 million subscribers on a net basis in March with the top three telcos adding more than 23 million users, reports fe Bureau in New Delhi. The performance is the industry’s best in over a year. According to COAI data, telcos added 10.8 million net subscribers in February after a dismal performance in January, when the industry lost 1.2 million users. Idea topped by adding 9.14 million, followed by Airtel at 8.4 million and Vodafone at 5.64 million. PAGE 3 Sebi probes sharp InterGlobe stock dip ahead of Ghosh’s resignation MARKET REGULATOR Sebi is examining the sharp plunge in shares of InterGlobe Aviation, which runs no-frills airline IndiGo, hours before it announced the resignation of its president Aditya Ghosh, reports PTI. Sebi is probing a more than 6% plunge in InterGlobe’s share price on April 27. Hours after the market close that day, the airline announced the resignation of Ghosh, who quit as a director of the company with effect from April 26, a day before the announcement was made. PAGE 11 India joins world’s top five defence spenders, surpassing France INDIA HAS joined the US and China as one of the world’s five biggest military spenders, reports Bloomberg. New Delhi’s defence spending rose by 5.5% to $63.9 billion in 2017 and has now passed France, the Stockholm International Peace Research Institute said in a report released on Wednesday. The list of the world’s biggest military spenders has remained consistent in recent years, dominated by the US and China, which spent $610 billion and $228 billion, respectively. PAGE 2 Cabinet’s decisions have an agri flavour FE BUREAU New Delhi, May 2 THE CABINET COMMITTEE on Economic Affairs (CCEA) on Wednesday decided to offer a subsidy of `5.5 per quintal to cane farmers this marketing year through September— at a potential cost of `1,540 crore — to help mills clear cane arrears that have already reached around `20,000 crore following a plunge in sugar prices. Both the Cabinet and the CCEA also cleared a raft of other proposals, ranging from upgrading three airports and an extension of a key umbrella scheme for the farm sector to an ordinance to speed up commercial dispute resolution. However, the new subsidy for cane farmers remains grossly inadequate to bridge a gap of `63 per quintal between the fairand remunerative price (FRP) fixed by the Centre and the rate mills will need to pay farmers based on the revenue-sharing formula of the Rangarajan panel, according to the sugar industry’s letter to the food secretarylast month.The panel had in 2012 suggested that farmers be paid 75% of mills’ realisations from sugar for cane supplies, or 70% of sales proceeds from sugar and other cane by-products like bagasse, molasses and press mud. The production subsidy to cane farmers (akin to that of `4.50 per quintal offered in 2015-16), instead of a direct export subsidy to mills, is designedtoremaincompatible with the provisions of the World Trade Organisation, which discourages trade-distortingdole-outs.“Thesubsidy will be released directly to farmers’ accounts,” law and electronicsandITministerRavi Shankar Prasad told reporters after the Cabinet meeting. Continued on Page 2 KEY APPROVALS ■ Terminals at Chennai, Guwahati and Lucknow airports to be upgraded; move to cost `5,082 crore `33,270 crore ■ Multi-sectoral Develop- ment Programme for minorities to be revamped, to have an outlay of `3,972 crore ■ An umbrella scheme for farm sector extended up to 2019-20, with a central outlay of Till FY20 ■ PM Swasthya Suraksha Yojana extended till 2019-20, to have an outlay of ` 14,832crore Amazon offers to buy 60% stake in Flipkart: Report ● CHURN AT THE TOP AirAsia India head Abrol to return to parent firm MANISHA SINGHAL Mumbai, May 2 AMARABROL,THE managing director and CEO of AirAsia India (AAI), will be moving back to the AirAsia Group’s headquarters in Malaysia, the company said in a statement on Wednesday. AAI is the budget airline owned jointly by the Tata Group and Malaysian entrepreneur Tony Fernandes and has a market share of just over 4%.AAI was set up after India opened up the aviation sector to foreign direct investment in 2013 and currently flies to 20 destinationswith hubs at Bengaluru,Kolkata and Delhi. Abrol’s successor is expected to be a seasoned aviation professional with international exposure. AAI has added six new routes and three aircraft since January and now commands a fleet size of 18 aircraft. The carrier is likely to add three more aircraft by the end of 2018, taking the tally to 20 and reaching the threshold to launch overseas flights. AAI posted a net profit of `13.24 crore in Q4CY17, its first since inception, on revenues of `518 crore, nearly twice that in Q4CY16. The airline carried 1.47 millionpassengersinQ1CY18, an increase of 74% year-onyear, information from AirAsia’s parent company showed. However, the passenger load factor, at 83%, was down by 6% year-on-year,as a result of an 87% increase in capacity. Continued on Page 2 Bid likely to be on par with Walmart’s; also said to offer $2-bn breakup fee REUTERS Bengaluru/Mumbai May 2 AMAZON.COM HAS MADE a formal offer to buy a 60% stake in Indian online retailer Flipkart,CNBC-TV18 reported on Wednesday, threatening to complicate Walmart’s bid to buy a majority stake in the Indian e-commerce player. Sources told Reuters earlier this month that Walmart was likely to reach a deal to buy a majority stake in Flipkart, Amazon’s biggest competitor in India, by the end of June for $10 billion to $12 billion. The deal would be the US retail giant’s biggest acquisition of an online business and would kick off a battle with Deal would kick off a battle Deal would be Amazon’s biggest with US retail giant in Indian e-comm acquisition market of an online business Analysts see Flipkart is industry to be Amazon’s worth $200 bn a biggest year in India in a competitor in decade India Amazon in an Indian e-commerce market that analysts forecastwillbeworth$200billion a yearwithin a decade. CNBC-TV18 reported that Amazon had offered Flipkart a breakup fee of $2 billion to convince it to discuss an offer ArcelorMittal, Numetal make their case for Essar Steel bid FE BUREAU Mumbai, May 2 TEST OF METTLE THE COMMITTEE OF creditors (CoC) of Essar Steel on Wednesday heard out explanations from ArcelorMittal and Numetal,the two bidders in the race forthe loss-making steelmaker. Both companies made presentations to establish their eligibility to bid for the steelmaker, bankers familiar with the development told FE. Theysaidbothbidderswere accompanied by their sets of lawyers and experts who, over the course of four hours, explained why they think they are eligible under Section 29 (A)oftheInsolvencyandBank- ■ CoC of Essar Steel heard ArcelorMittal and Numetal explanations ■ Both companies sought to establish their eligibility to bid ■ ArcelorMittal and Numetal were given two hours each to explain their stand ruptcy Code (IBC). This, the bankers said, follows written submission by both parties earlier this week on the eligibility issue. “The CoCwill nowlook into FE BUREAU Manufacturing: Q1 begins on a positive note 55 53 Manufacturing PMI Services PMI 51.6 49.6 51 49 47 45 50.3 March April 2018 46.8 Dec 2016 92 46 9 18 Onland blocks Offshore blocks and marketing and pricing freedom for the developers. Officials claimed the level of interest shown by bidders “far exceeded expectations”, but ● AUCTION THREAT SC asks for Unitech directors’ personal assets list FE BUREAU New Delhi, May 2 Continued on Page 2 Continued on Page 2 Vedanta Cairn, ONGC bids help the government spare blushes VEDANTA CAIRN, OPERATOR of the prolific Barmer field in Rajasthan, bid aggressively, while eight other companies, including state-run ONGC,OilIndia,IndianOiland GAIL (India) also put in their bids for the 55 hydrocarbon blocks offered under the Open Acreage Licensing Policy (OALP), a critical part of the March 2016-launched Hydrocarbon Exploration Licensing Policy (HELP). HELP's hallmarks are single licence for exploration of all forms of hydrocarbons (including shale gas and coal bed methane), a simplerevenue-sharingmodel Continued on Page 2 the absence of a single foreign oil giant was conspicuous. Reliance Industries stayed away as well. State-owned ONGC bid for 37 blocks while Vedanta Cairn put in bids for all the 55 areas on offer. As many as 110 bids had been received, the Directorate General of Hydrocarbon (DGH) tweeted. While 92 bids were received for 46 on-land blocks,18bidscameinfornine offshore blocks. While the bid amounts were not disclosed, PTI reported that Cairn put in very aggressive bids for 13 blocks and a little less so for another nine. Source: Nikkei, IHS Markit HYDROCARBON BLOCK AUCTION On offer Bids received the written submissions over the next couple of days and issue an orderon theireligibility,” a lender said. Another banker FE spoke to said that the meeting was an opportunity to both bidders to explain their stand on eligibility following directions from the Ahmedabad bench of the National Company Law Tribunal (NCLT). In its April 19 order, NCLT Ahmedabad had asked Essar Steel’s CoC and resolution professional (RP) to reconsiderthe first set of bids received from Numetal and ArcelorMittal, granting an additional 30 days for the resolution process. EXPRESSING DISPLEASURE OVER the dilly-dallying of embattled real estate firm Unitechindepositingmoneyto compensate harried home buyers, the Supreme Court on Wednesday asked its directors andsubsidiariestosubmitalist of their personal assets,which would be considered for auctioning if the company fails to deposit `100 crore byMay11. The real estate company was to deposit the amount it would raise through sale of its power firm in Bengaluru to a prospective buyer. Unitech was supposed to depositwiththecourtatotalof `750 crore by December to secure bail of its managing director Sanjay Chandra. The money has not yet been deposited and repeated requests to release Chandra have been denied by court. Chandra is seeking interim bail from the apex court after the Delhi HC on August 11 last yearrejectedhispleainacriminal case lodged in 2015 by 158 home buyers of Unitech projects Wild Flower Country and Anthea Project in Gurugram. Note: Reading below 50 suggests contraction and above it indicates expansion FE BUREAU New Delhi, May 2 Continued on Page 2 MEETING WITH CoC PMI After a five-month low in March, India's manufacturing activity improved marginally in April, due to new business orders. Inflationary pressures moderated for the second month in a row, with the softest increases for input costs and output charges since September. that analysts say would bring with it substantial antitrust challenges, as Flipkart and Amazon dominate the online shopping space inAsia’s thirdlargest economy.
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