OPINION, P8 COMPANIES, P6 INTERNATIONAL, P14 FUND CRUNCH SURPRISE DECISION Naresh Goyal-led Jet Airways grounds two aircraft Nikki Haley to leave as US ambassador to UN at year's end EDITORIAL NBFC bailout critical, regulator didn’t flag asset-liability gaps Aadhaar-based ID can be done using QR codes without violating SC ruling NEW DELHI, WEDNESDAY, OCTOBER 10, 2018 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL.XLIV NO. 190, 22 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: 34,299.47 ▼ 174.91 NIFTY: 10,301.05 ▼ 47 NIKKEI 225: 23,469.39 ▼ 314.33 HANG SENG: 26,172.91 ▼ 29.66 `/$: 74.39 ▼ 0.32 `/€: 85.12 ▼ 0.14 BRENT: $84.39 ▲ $0.48 GOLD: `31,049 ▼ `107 ON SECOND THOUGHTS ● SC ORDER JSW wants to bid for Essar Steel on its own BULDANA URBAN ArcelorMittal and Numetal have been given 2 weeks by SC to repay dues; post this, CoC will assess eligible proposals SURYA SARATHI RAY New Delhi, October 9 IN THE NEWS Rupee hits new low of 74.39 against dollar THE RUPEE ON Tuesday crashed to new lows, hitting 74.3935 against the dollar in intraday trade before staging a mild recovery to close at an all-time low of 74.3875, reports Utsav Saxena in Mumbai. The currency depreciated 32 paise amid deepening concerns over India’s current account deficit, fund outflows and the continued pressure from the central bank’s unexpected decision of keeping the repo rate unchanged. SBI reports 1,329 fraud cases worth `5,555 cr in H1 AS MANYAS 1,329 cases of fraud, involving `5,555.48 crore, came to light in SBI in first six months of FY19, reports PTI. SBI said 669 cases of fraud amounting to `723.06 crore were reported in Q1 (April-June), while 660 cases, involving an amount of `4,832.42 crore, came to light in Q2 (July-September). THE SAJJAN-JINDAL PROMOTED JSW Steel wants to go solo in the race for bankrupt steelmakerEssarSteel.JSWSteel had earlier bid for Essar Steel together with Numetal. Given the Supreme Court has already outlined the way forward after hearingalltheargumentsunder the Insolvency and Bankruptcy Code (IBC), it would appear the steelmaker must approach the apex court for permission to throwits hat in the ring. MVSeshagiriRao,jointmanagingdirector,JSWSteel,saidon Tuesday that the company was seeking legal opinion on whether it would be eligible to bid forEssarSteel togetherwith ArcelorMittal, Numetal and Vedanta.“It depends upon the legal opinion which we get and the views of the commitee of creditorsandtheresolutionpro- April 19 NCLT Ahmedabad asked RP, CoC to consider first set of bids April 28 ArcelorMittal moved NCLAT challenging Numetal's eligibility March 26 ArcelorMittal moved NCLT challenging rejection of its bid September 7 NCLAT holds Numetal's 2nd bid eligible but asks Arcelor to first pay dues March 23 CoC declared both bids ineligible and invited fresh bids September 10 Both parties appealed in SC against NCLAT order February 12, 2018 ArcelorMittal, Numetal submitted bids October 4 SC asks both Numetal and ArcelorMittal to resubmit revised bids, clearing taints August 2, 2017 NCLTadmitted Essar Steel's insolvency case fessional(RP).Iftheytakeapositive view, then we are open to look at it.We are seeking a legal opinionandbasedonthatopinionwewill take a call,” Rao said. The VTB Capital-led Numetalwouldbeeligibletobid for Essar Steel, provided the company pays off its dues of `49,000 crore.While ArcelorMittal is understood to have agreed to pay `42,000 crore, Numetal’s bid for Essar Steel is believed to be in the region of `37,000 crore.The Anil-AgarwalpromotedVedantaiswilling to pay a slightly smaller sum of around `35,000 crore. On October 4, the apex court gave both Numetal and ArcelorMittal a final chance to clear their “taint of disqualification” by clearing the dues to their respective creditors that they were associated within two weeks. Continued on Page 2 Continued on Page 2 WhatsApp to store data locally WHATSAPP,WHICHHASbeen running a pilot of its payment service in the country with 1 million users, said on Tuesday that it has built a system which stores payments-related data locally in India to comply with the Reserve Bank of India’s guidelines on data localisation. The RBI had, on April 5, put out a circular stating that all payment system operators in thecountrymustmovetoasystem of storing transaction data within India by October 15. So GUIDELINES ■ RBI in April asked all payment players to save domestic transaction data in India only ■ Deadline for compliance is Oct 15 ■ Visa, Mastercard, Google, WhatsApp, PayPal, Truecaller most affected by new rule far,WhatsApp is the onlymajor overseas payments player to have confirmed its intent to complywith the circular. However, it is still not clear whetherWhatsApp will get the regulatory approval from the NationalPaymentsCorporation ofIndia(NPCI)forafull-fledged roll out of its payments service as it has not clarified whether such data is being shared with any third party like its parent firm Facebook.The ministry of electronicsandIThadraisedthis queryandalsoadvisedtheNPCI to accord approval only once it clarifies whether it shares data with anythird party. Continued on Page 2 ● PRIORITY TAG QuickPicks IMF retains India’s FY19 growth outlook at 7.3%, trims global THE INTERNATIONAL Monetary Fund trimmed its 2018 global economic growth forecast by 20 bps from its July prediction, reports fe Bureau in New Delhi. It, however, retained its India growth projection at 7.3% for the current fiscal, as a trade war between the US and others has started to hit economic activity. In its World Economic Outlook report, the IMF cut global trade growth forecast for a second time this year, expecting a 60 bps decline from its July forecast for 2018. PAGE 2 Poor JLR sales: Tata Motors shares hit multi-year lows WITH JAGUAR Land Rover reporting a 12.3% decline in global sales in September, the Tata Motors scrip fell sharply by over 13% on Tuesday, report fe Bureau & PTI. During the day, it slumped 19.78% to `170.65, its multi-year low level. JLR reported a fall in its global retail sales to 57,114 units for September. Due to Brexit uncertainity, weak demand in China and the US, JLR's overall sales sequentially fell by 33% in Q`FY19. PAGE 7 Wider credit access to exports likely BANIKINKAR PATTANAYAK New Delhi, October 9 AS A WORSENING current account deficit stokes fresh concerns, the government is consideringstrengtheningpriority-sectorlendingforexports to enable greater flow of credit tothesector,accedingtoalongpending demand byexporters. Currently, incremental export credit (overcorresponding date of the preceding year) up to just 2% of adjusted net bankcreditorcreditequivalent amount of off-balance sheet exposureofdomesticcommercial banks,whichever is higher, isconsideredpartoftheirpriority-sector lending obligation. 50.6% Drop in export credit (y-o-y) as of end-Aug to `20,500 crore This limit maybe raised. The move comes at a time when export credit has collapsed by over a half as of endAugust from a year before, while exports grew over 19% for the month. Continued on Page 2 US-CHINA TRADE WAR India charts out plan to seize the moment BANIKINKAR PATTANAYAK New Delhi, October 10 THE ONGOING TRADE war between the US and China that haswitnessed Beijing slapping higher duties on American goods in tit-for-tat action has opened up awindow of opportunity for India that has long struggled to contain a widening trade deficit with its giant neighbour. But gains are contingent on getting market Gaining from higher Chinese duty on US goods Where India doesn't have market access in China No of US exports India's exports items to China to world 17 $3,001 m $4,051 m Where India has market access in China No of US exports India's exports items to China to world 44 India's exports to China $7,241 m $4,287 m $586 m access and achieving competitiveness in many cases. According to a commerce Source: Commerce ministry study ministry study, of the 603 Americantarifflines(items)on which Beijing has imposed FE BUREAU New Delhi, October 9 THE SUPREME COURT on Tuesday sent three Amrapali Group directors, who were present in the court, to police custody till they hand over every document related to accounts of all their 46 group companies to the forensic auditors appointed by the apex court. “I hope nowtheywill cooperate…You (directors) are playing hide and seek.You are trying to mislead the court,” a Bench led by justice Arun Mishra said. The three directors — Anil KumarSharma,ShivPriya and Ajay Kumar —will remain in police custody till they hand over all the documents. Thecourtalsoissuedformal noticetothethreecontemnors andallthecompaniesandtheir directors to show cause why proceedings for contempt be not initiated against them.All the eight directors and the statutory auditors are not supposed to leave the country and they have to surrender their passports to the Delhi Police. However, the nominee directors are exempted. MEETS RBI RULES FE BUREAU Mumbai, October 9 Amrapali directors sent to police custody extra duties in the range of 1525%, India can ship out more in case of 44 items without much difficulty,as it currently has access to the Chinese marketintheseproducts.However, in case of 17 items where American supplies are substantial, India doesn’t have market access; so,it can export theseitemsonlyifChinaopens up further. Continued on Page 2 CRISIS MANAGEMENT Govt hastens IL&FS rescue act MCA readying report on 179 ‘extra’ firms; NHAI to soon settle troubled group’s claims over stuck projects after a third-party audit SURBHI PRASAD AND SURYA SARATHI RAY New Delhi, October 9 WHILE THE NEWLY appointed board of crisis-hit Infrastructure Leasing and Financial Services (IL&FS) is slated to hold its second meeting on Friday,the government DEBT DUE Needs to repay `2,587.21 cr by March 31, 2019, on CP, bonds and NCDs Short-term loans of `3,371 cr New IL&FS board to meet this week to resolve crisis has expedited its own evaluation of the depth of the trouble the infrastructure-financing and engineering conglomerate has got into and steps to salvage it with whatever legitimate support. According to sources, the ● LIQUIDITY CRUNCH SBI bailout for NBFCs FE BUREAU & AGENCIES Mumbai, October 9 AT A TIME when most banks are freezing lending to nonbanking financial companies (NBFCs) on worries over their asset liability management (ALM),StateBankofIndia(SBI) on Tuesday said it has decided to treble its current-yeartarget forpurchasesofloanportfolios from NBFCs to `45,000 crore. The announcement by SBI comes amid reports of NBFCs writing to the government to ensure adequate liquidity support for them. “This is a good commercialopportunityforthe bank to increase the loan portfolioasNBFCassetsareavailable at attractive rates,” managing director PK Gupta said.“There may be an opportunity to buy additionalportfoliointherange of `20,000 to `30,000 crore.” Detailed report on Page 10 ministry of corporate affairs (MCA) has commenced a “probe into 179 subsidiaries” of the debt-laden group, to ascertain if these firms, the existence of which wasn’t common knowledge until the board stumbled upon them in its first meeting, indeed have any operational role or are mere shell companies. A detailed report on the existence and status of the 348 companies in the IL&FS fold (169 known earlier and the 179 newly found) is likely to be ready before the next hearing of the case at the National Company Law Tribunal on October 31, an MCA official told FE. Continued on Page 2 Special Feature SIP Hold on to stocks, buy on dips and continue SIP ■ Personal Finance, P13
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