OPINION, P8 ECONOMY, P2 EDITORIAL Stem cell transplant offers hope of a sustainable HIV cure INTERNATIONAL, P14 SURJIT S BHALLA NEW ROLE FRAUD CHARGES Politically-motivated misuse of data has become quite common since 2014 Subhash Chandra Garg named finance secretary Trump ex-campaign chief Manafort sentenced to almost 4 years in jail NEW DELHI, SATURDAY, MARCH 9, 2019 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL. XLV NO. 7, 28 PAGES, `10.00 (PATNA `9.00, RAIPUR `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 SENSEX: 36,671.43 ▼ 53.99 NIFTY: 11,035.40 ▼ 22.80 NIKKEI 225: 21,025.56 ▼ 430.45 HANG SENG: 28,228.42 ▼ 551.03 `/$: 70.15 ▼ 0.15 `/€: 78.68 ▲ 0.52 BRENT: $64.78 ▼ $1.52 GOLD: `32,123.00 ▲ `141.00 ESSAR STEEL ● CHANGE FROM MAY 1 ArcelorMittal gets NCLT approval for revival plan A passenger takes a selfie with woman coolie Sandhya Marawi on International Women's Day, at the Jabalpur railway station on Friday APRIL 1 DEADLINE Top companies yet to appoint independent woman directors WITH LESS THAN a month left to comply with one of the key recommendations made by the Kotak Committee on corporate governance, more than 20% of the top 500 listed companies by market capitalisation are still to appoint an independent woman director on their boards. In total, 101 companies are non-compliant on this parameter as on date. The new regulation comes into effect from April 1. Some of the companies yet to appoint an independent woman director include heavyweights such as Indian Oil Corporation,Bharti Airtel, Interglobe Aviation, General Source: PRIME Database As per data as on Mar 6, 2019 Insurance Corporation, Siemens, Procter & Gamble Hygiene and Healthcare, Bank of India, DLF, Godrej Industries, Jindal Steel and Power,and Pfizer,among others, according to PRIME Database data as on March 6, 2019. According to analysts, these companies will have to appoint at least one independent woman director on their boards by April 1, when the Kotak Committee’s recommendations come into effect or else they will be violating the listing agreement with the Securities and Exchange Board of India. “This is a requirement that the companies have to fulfil by April 1, 2019 to comply with their listing agreement with Sebi,” Sai Venkateshwaran, partner and headaccounting advisory services, KPMG in India, told FE. “Global studies have shown that having woman directors improves the quality of discussion and a broader range of issues get addressed,” he added. Koenigsegg Jesko is a projectile on wheels At the Geneva Motor Show, Koenigsegg has débuted Jesko as successor to the world’s fastest supercar; the car codenamed Ragnarok is now a reality ■ Motobahn, P13 QuickPicks NCLT admits ICICI Bank petition against Punj Lloyd THE NATIONAL Company Law Tribunal (NCLT) on Friday admitted a petition filed by ICICI Bank against engineering and infrastructure company Punj Lloyd, reports fe Bureau in New Delhi. The ICICI Bank petition pertains to a default amount of `853 crore by Punj Lloyd. PAGE 6 Arvind Fashions shares lose lustre in debut trade ARVIND FASHIONS, the demerged entity of textile major Arvind, on Friday listed on the bourses at `591, report Chirag Madia & Rakshita Sareen in Mumbai. While a base price of `311 was fixed by the exchanges for trading, market participants felt it should have been in the range of `1,200-1,500 a share. At close of trading, the stock was priced at `621.30 on the BSE. PAGE 10 Mutual fund inflows in February lowest in 25 months INFLOWS INTO pure equity schemes of mutual funds in February slipped to the lowest levels in 25 months at `3,948 crore, reports Chirag Madia in Mumbai. A study of around 360 openended equity schemes by Valueresearch showed that 67% of them have given negative returns in the last one year. PAGE 10 FLY LEASING HAS grounded three planes on lease to JetAirways and will take them back and redeploy them elsewhere if the airline cannot gain approvals for a restructuring plan this month, the lessor's CEO said. Jet Airways on Thursday said anotherthree aircraft had been grounded due to its failure to make payments, taking the total number to 28, but it has not specified the lessors involved. The grounding of nearly one-quarter of the airline's fleet has led to the cancellation of hundreds of flights and Feb 12 2018 it is now more than two years since the process began. The bench also suggested the committee of creditors (CoC) consider Standard Chartered Bank’s claim be treated equally with those of other membersofCoCunderArcelorMittal’s plan. Standard Chartered’s grouse is that it is being treated as a minor financial creditor and is due to receive only a little over `60 crore against dues totalling approxi- complaintsfromcustomerson social media. Continued on Page 2 Continued on Page 2 ■ FLY Leasing will redeploy the planes elsewhere if the airline cannot gain approvals for a restructuring plan this month, the lessor's CEO said ■ Grounding of three more Jet aircraft due to failure to make payments has taken the total number to 28 Passenger vehicle growth (%) 40 9.26 7.89 7.22 30 20 3.9 3.27 turers (SIAM) said on Friday. In the April-February period this fiscal,PVsales have grown 3.27% at 30,85,640 ● BANK LOANS CHINA’S EXPORTS TUMBLED themostinthreeyearsinFebruarywhile imports fell fora third straight month, pointing to a further slowdown in the economyand stirring talk of a“trade recession”, despite a spate of support measures. While seasonal factors may havebeenatplay,theshockingly weak readings from theworld’s largest trading nation added to worries about a global slow- 7.5 -1.11 -10 Apr 2018 Feb 2019 units against 29,87,859 units in the year-ago period. Continued on Page 2 ● RELIEF TO INDUSTRY Tesla gets $520-m funding GST not to for first Chinese plant apply on AGENCE FRANCE-PRESSE which has been in negotiations Shanghai, March 8 with Beijing for years over TCS: CBIC buildingtheplantintheworld’s biggest electric carmarket. The US giant will make its Model 3 sedans at the factory — initially targeting 3,000 cars a week before ramping up annual production to 500,000 — which it plans to have operational by the end of the year. ELECTRIC CARMAKERTESLA has won more than $520 million in loans from Chinese banks to build its first overseas car plantnearShanghai,the first foreign automaker to wholly own a factory in China. The funding,announced on Thursday,isanimportantboost for the California-based firm, FE BUREAU New Delhi, March 8 worldwide. Februaryexports fell 20.7% from a year earlier, the largest decline since February 2016, customs data showed. Economists polled by Reuters had expected a 4.8% drop afterJanuary's unexpected 9.1% jump. “Today’s trade figures reinforceourviewthatChina’strade recessionhasstartedtoemerge,” RaymondYeung,GreaterChina chiefeconomistatANZ,wrotein a note. THE CENTRAL BOARD of Indirect Tax and Customs (CBIC) on Friday clarified that the goods and services tax (GST)willbeleviedonthevalue ofsupplyexcludingthetaxcollected at source (TCS), overturning a circular issued on December31lastyear.Thishas come as a relief to the industries that come under TCS ambit,especiallymineralfirms and automakers as the taxinclusive price to the consumer could now be lower. The TCS levied under the IncomeTaxAct has the express purpose of keeping a trail on certain high-value transactions; forexample,a consumer buying a vehicle worth over `10 lakh is required to pay a 1% TCS on the ex-showroom price.The consumercan offset the TCS as he pays the income tax. Abhishek Jain, tax partner, EY India, said,“This clarification comes as quite a relief for businesses specifically the automotive sector,” Continued on Page 2 Continued on Page 2 Continued on Page 2 China Feb exports tumble the most in three years down,a day after the European Central Bank slashed growth forecasts for the region.Asian stock markets and US futures extended losses after the data. Chinese stocks sank over 4% in theirworst dayin five months. GlobalinvestorsandChina's major trading partners are closelywatchingBeijing'spolicy reactions as economic growth cools from last year’s 28-year low. But the government has vowed it will not resort to massive stimulus like in the past, which helped revive demand 10 0 ‘TRADE RECESSION’ FEAR STELLA QIU & RYAN WOO Beijing, March 8 Continued on Page 2 Passenger vehicle sales during FY19 slowest in last four years WITH PASSENGER VEHICLE sales declining 1.11% (YoY) in February, making it the seventh decline in the last eight months, the industry will register one of its slowest growth in the last fouryears at around 3% in FY19. The last time the PV sales had hit a low of 3.9% was in FY15. The sales decline in February is the seventh instance in the last eight months,with the onlypositive growth since July last year coming in October, auto industry body Society of Indian Automobile Manufac- PAYMENT CHALLENGE RP holds both bids ineligible mately `3,400 crore. The tribunal, however, added that ArcelorMittal was not required to make any further offer and thatonlytheallocationmethod could be relooked. Early on, various senior bankers had indicated to FE that Standard Chartered had voted against the ArcelorMittal resolution plan. As many as 31 operational creditors of Essar Steel had moved the NCLT in five separate petitions urging that it direct the CoC to ensure full payment to them and take necessary steps to modify ArcelorMittal’sresolutionplan for that. Alternatively, they urged the tribunal to direct the CoC to also consider the last minute offer of the Essar Steel promoters which promises to pay all creditors in full. ArcelorMittal’s offer is a revision to the second round of bids that lenders and the resolution professional Satish Kumar Gupta had called for back in April after the first round of bids submitted by ArcelorMittal and Numetal, a companyco-ownedbyRussia’s VTB Bank were found to be ineligible. IN SLOW LANE THE SUPREME COURT on Friday referred the politically sensitive Ram JanmabhoomiBabri Masjid land dispute case for mediation by a three-member panel led by its former judge FMI Kalifulla. Thedisputeisover2.7acres of land in Ayodhya, Uttar Pradesh, on which the 16thcentury Babri mosque stood before it was demolished on December 6, 1992 by Hindu right-wing activists, who believe itwas built on the ruins of an ancient temple marking the birthplace of Lord Ram. In 2010, the Allahabad High Court had allotted two-thirds of the land equally among the three parties to the templemosque dispute — the Sunni Waqf Board, the Nirmohi Akhara and Ram Lalla (infant Ram). As manyas 14 appeals have been filed against the judgment,both byHindu and Muslim organisations. The apex court in 2011 stayed the HC order. The three-member panel also comprises spiritual guru and founder of Art of Living foundation Sri Sri Ravi Shankar, and senior advocate Sriram Panchu. Continued on Page 2 Mar 2018 First round of bidding takes place: Numetal and ArcelorMittal submit bids. FE BUREAU New Delhi, March 8 Lessor grounds 3 Jet Airways Boeing 737s REUTERS Singapore, March 8 Panel led by ex-SC judge to mediate Aug 2 2017 NCLT rejects settlement offer by Ruias Jan 29 2019 Oct 2018 FE BUREAU New Delhi, March 8 MORE TROUBLE Special Feature ● AYODHYA DISPUTE Oct 25: Ruias offer to pay lenders `54,389 crore to retain Essar Steel NCLT admits Essar Steel for insolvency proceedings under the IBC. NCLAT directs NCLT to pass its final order on the ArcelorMittal plan by March 8 Feb 28 2019 2014-15 “To address the concern of rigidities in the balance sheet structure and address the issue of quick transmission of changes in RBI’s policy rates, effective May 1, 2019,we have taken the lead in linking key pricing decision for savings bank deposits and short-term loanstothereporateoftheRBI,” the bank said in a statement. But the move will not benefit all its depositors as the new rate is applicable only to those withabalanceofover`1lakhin their accounts.The repo rate is currently at 6.25%. SBI said it will link savings bank deposits with balance above `1 lakh to thereporatewithcurrenteffective rate being 3.50% per annum.Ithasalsolinkedallcash credit accounts and overdrafts with limits above `1 lakh to the reporateplusaspreadof2.25%. SAURABH KUMAR & YOOSEF KP New Delhi/Mumbai, March 8 Oct 24: Over 90% oflenders on CoCvote in favour of ArcelorMittal's resolution plan FY19 (Apr-Feb) Woman power ARCELORMITTAL’S `42,000CRORE resolution plan for the debt-laden Essar Steel was on Fridayapproved bytheAhmedabad bench of the National Company LawTribunal (NCLT). ThepromotersofEssarSteel,the Ruias,couldappealtherulingin the appellate tribunal or the Supreme Court. The two-member bench suggested lenders give 15% of the proceeds to operational creditors, on a pro rata basis, leaving the decision entirelyto their discretion. Claims by operational creditors have been rejected. Essar Steel’s bankruptcy proceedings have long crossed the 270- day deadline prescribed by the Insolvency and Bankruptcy Code (IBC); in fact Oct 23: ArcelorMittal SAagrees to make a bigger offer of`42,000 crore, a revision to second round ofbids that lenders and the RPSatish Kumar Gupta had called for inApril 2017-18 JYOTSNA BHATNAGAR & MITALI SALIAN Ahmedabad/Mumbai, March 8 Oct 4: Supreme Court asks Numetal and ArcelorMittal to submit revised bids after paying outstanding dues in two weeks. Ifthe account is not resolved in eightweeks, itwill go into insolvency. ILLUSTRATION: ROHNIT PHORE INAFIRST-OF-ITS-KINDinitiative, the nation’s largest lender State Bank of India on Friday announcedlinkingofitssavings deposits rates and short-term loanstoanexternalbenchmark, the repo rate, of the Reserve Bank.Thenewrateswillbeeffective May 1, the bank said in a statement. The move will to a large extent speed up the monetary transmission process,which is banks passing on the rate cuts that the RBI announces to their borrowers — something that has been missing all this while and something that the monetary authority has been unhappywith. Essar promoters Ruias likely to appeal the ruling in the appellate tribunal or the SC 2016-17 PRESS TRUST OF INDIA Mumbai, March 8 2015-16 In a first, SBI links pricing of loans, deposits to repo rate
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.