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APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL 31 NO. 236, 26 PAGES, `10.00 (NORTH EAST STATES & ANDAMAN `13.00) 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: 58,387.93 ▲ 89.13 NIFTY: 17,397.50 ▲ 15.50 NIKKEI 225: 28,175.87 ▲ 243.67 HANG SENG: 20,201.94 ▲ 27.90 `/$: 79.24 ▲ 0.23 `/€: 69.7572 ▼ 0.09 BRENT: $94.69 ▲ $0.57 GOLD: `51,948 ▲ `114 ● Inflation projection retained at 6.7%,GDP growth at 7.2% ● MPC hikes repurchase rate by 50 bps to 5.40% ● More rate hikes inevitable: Economists Repo rate tops pre-Covid level SHRITAMA BOSE Mumbai, August 5 IN THE NEWS PM Modi to chair NITI Aayog meet tomorrow PRIME MINISTER Narendra Modi will on Sunday chair the 7th meeting of the Governing Council of Niti Aayog to deliberate with chief ministers on issues such as crop diversification, achieving self-sufficiency in oilseeds and pulses and agri-communities, reports fe Bureau in New Delhi. P2 FPI matters: Sebi constitutes committee SEBI HAS constituted a Standing Committee in order to provide recommendations and advise on policy matters relating to foreign portfolio investors (FPIs), reports fe Bureau in Mumbai. P9 Harness FTAs to boost exports: Goyal to industry COMMERCE AND industry minister Piyush Goyal on Friday asked industry to study various free trade agreements (FTAs) that the country has signed and identify areas where domestic suppliers have competitive edge so that they can boost exports, reports fe Bureau in New Delhi. P2 Flipkart Wholesale eyes omni-channel approach to grow FLIPKART WHOLESALE, a digital businessto-business (B2B) marketplace of Flipkart Group, is planning to have an omni-channel approach to expand and grow the business, reports Shubhra Tandon in New Delhi. P4 FE SPECIAL i4: As good as the President’s car? It may not become part of President of India’s car collection, but does not look out of place in front of the palace. ■ Motobahn, P8 THE MONETARY POLICY committee (MPC) of the Reserve Bank of India (RBI) votedunanimouslytoraisethe repo rate by 50 basis points (bps) to 5.40%, above the prepandemic level of 5.15%. The third increase in a row signals the MPC’s intent to keep fighting inflation even asconsumer prices show signs of easing. The MPC said it would remain focused onwithdrawal of accommodation to ensure that inflation remains within the targetgoing forward,while supporting growth. External member Jayanth R Varma expressed reservations with this part of the resolution. TheStandingDepositFacility rate and the Marginal Standing Facility Rate were adjusted higher by the same quantum to 5.15% and 5.65%,respectively. TheRBIjoinedcentralbanks aroundtheworld,whichhaveof late opted for large rate hikes in a bid to tame inflation,in delivering a hike that was at the higher end of market expectations.RBIgovernorShaktikanta Das said that inflation remains “unacceptablyhigh”.“Ifyoulook all around, other central banks today, 50 basis points (of rate hikes) has become the newnormal and quite a numberof centralbanksarenowhikingby75100(bps),”Dassaid,adding,“But then, in the Reserve Bank, we take a very calibrated and measuredview.” Stating that food and metal prices have been softening of 8 (%) 7 6 Aug 1, ‘18 6 Repo rate 6.5 6.5 Aug 7, ‘19 May 4, ‘22 4 4 3 4.4 May 22, ‘20 INDU BHAN New Delhi, August 5 Aug 5, 2022 Aug 2, 2017 If you look all around, other central banks today, 50 basis points (of rate hikes) has become the new normal and quite a number of central banks are now hiking by 75-100 (bps). —SHAKTIKANTA DAS, GOVERNOR, RBI RELATED REPORTS Hawkish stance stays despite third rate hike, P8 ‘Policy more about dealing with global uncertainties’, P6 Concerns about inflationary pressures, P6 late, the MPC cited persisting supplychain issues,a shortfall in paddy sowing and the transmission of high input costs into finished goods as risks to inflation. Continued on Page 2 Costlier loans may not hurt credit demand, say bankers FE BUREAU Mumbai, August 5 RETAIL AND CORPORATE borrowers will have to pay higher interest rate on loans following Friday’s hike in the repo rate by 50 bps to 5.4%, but bankers say this will not stymie the demand for credit. Rajiv Anand, deputy MD, Axis Bank, said credit demand was unlikelyto be hurt,adding that demand was coming in from the corporate, SME and retail segments. “It is not as though the rates are unnaturallyhigh,theyareatpre-Covid levels and the economy is growing.” Partha Pratim Sengupta, MD & CEO, Indian Overseas Bank, confirmed that his bank was seeing strong demand for loans. Chandra Shekhar Ghosh, MD&CEO,BandhanBank,also said demand for loans from MSMEs and individuals was picking up. “Businesses are doing better and ahead of the festive season there is demand for working capital, even thoughinterestratesmayhave risen”Ghosh said. However, those retail cus- tomerswho borrowed at 6.5% a few months ago will now need to service the loans at 8% and that could hurt. “While there may be no immediate stress, 150 bps jump inloanratesisnotsmall,” Dipak Gupta, joint managing director, Kotak Mahindra Bank, said. Gupta added that the rate hiking cycle was not overyet. Other bankers, too, expressed similar concerns, given the repo rate is expected to be hiked by another 60 bps. Continued on Page 2 Bill proposes prior CCI nod ED freezes `65-cr for M&As above `2,000 cr funds of WazirX FE BUREAU New Delhi, August 5 THE GOVERNMENT HAS sought Parliament’s consent to amend the Competition Act, 2002, to ensure that mergers andacquisitions(M&As)involving global tech giants and potentiallyhavingan“appreciable” effect on Indian markets don’t escape the country’s antitrust scrutiny. The Competition (Amendment) Bill,2022,introduced in Parliament on Friday,proposes thatalldealsworthover`2,000 crorebesubjecttotheCompetitionCommissionofIndia’s(CCI) prior approval if the firms have “substantial business operations” in India. It also lays out process to ascertainwhetheran entityhas“substantialbusiness operations”in India ornot. Accordingtosources,theBill also provides for a slew of other changestotheActtoincorporate SC directs Sebi to provide RIL access to papers Markets regulator duty-bound ‘not to circumvent rule of law’, says CJI-led bench 5 5.4 5.4 5 SHARE PURCHASE CASE ■ The Competition (Amendment) Bill, 2022,was introduced in Parliament on Friday ■ Provides for a slew of changes to further empower the Competition Commission For India, trigger for the move was Facebook's acquisition of WhatsApp in 2014 for $19 billion newmarketrealities,includinga reduction in the time limit for approval of combinations from 210 days to 150 days.Further,it seekstoputinplaceasettlement mechanismconcerningcontraventionsrelatedtocertain“anticompetitive agreements and abuseofdominance”. An application for settlement may be filed only after receipt of investigation report andbeforepassingoffinalorder bytheCCI.Thecommissionmay determine the norms for computing settlement amounts. Continued on Page 2 PRESS TRUST OF INDIA New Delhi, August 5 The agency’s probe against the crypto exchange is linked to its ongoing investigation THE ENFORCEMENT DIREC- against a number of Chinese TORATE (ED) on Friday said it loan apps. The agency had has frozen `64.67-crore bank charged WazirX last year deposits as part of a money for alleged contravention of laundering probe against the Fema. “The lax KYC crypto currency norms, loose regulaexchange WazirX. tory control of transThe agencysaid it conactions between ducted raids against a WazirX and Binance, directorof Zanmai Lab non-recording of Pvt Ltd, which owns transactions on block WazirX,onAugust 3 in chains to save costs Hyderabad and and non-recording of alleged he was “nonSameer Mhatre, the KYC of the oppocooperative”. “It was found that director,WazirX site wallets has ensured thatWazirXis Sameer Mhatre, direcnot able to give any torWazirX,hascomplete remote access to the database account forthe missing crypto ofWazirX,butdespitethatheis assets,” the ED alleged in a not providing the details of the statement.Itsaid thecompany transactions relating to the made no efforts to trace these crypto assets, purchased from crypto assets. theproceedsofcrimeofinstant loan app fraud.” Continued on Page 2 IN A RELIEF to Reliance Industries(RIL),theSupremeCourton Friday asked the Securities and Exchange Board of India (Sebi) to act “fairly” and give the Mukesh Ambani-led company access to certain documents which the latter claims will exonerate it and its 107 promoters from criminal prosecutioninitiatedinacaserelatedto the alleged irregularities in acquisition of its own shares between 1994and 2000. A bench led by Chief Justice NV Ramana said the market regulator is duty-bound“not to circumvent the rule of law.” Besides the Sebi’s records in connection with the case,RIL is seeking three more documents — the two legal opinions byformerSCjudgeBNSrikrishnaand former ICAI president YH Malegam’s reportwhich examinedtheallegedirregularitieson Sebi’s request. Denying any allegations of round-tripping, the company contended these documents would negate the allegations of wrongdoing in the acquisition of shares andwould have avital bearing on the criminal case being filed bythe regulator. RILwasentitledtodisclosure of all the material that would help itresist the restoration ofa criminal complaint by Sebi, seniorcounselHarishSalve,representingRIL,hadargued,while admitting to some of the“tech- RELIEF FOR RIL The case relates to alleged irregularities by RILin acquisition of its own shares between 1994 and 2000 ■ In January 2019, Sebi rejected RIL’s request for documents ■ Besides Sebi records, RIL is seeking 3 more documents — 2 legal opinions by SC exjudge BN Srikrishna and ex-ICAI president YH Malegam’s report nical breaches”. However, the marketregulatorhadrefusedto share the “privileged” documents, saying the company’s only object is to frustrate the process of the law by pursuing ‘frivolouslitigation’andcausing unnecessary delay in the criminal proceedings initiated against it and its promoters. Sebihadalsotakenthestand that these“opinions are part of theprivilegecontainedinterms ofSection129oftheIndianEvidence Act 1872 and hence immune from production before anyproceedings”. Continued on Page 2 Q1 REPORT CARD M&M net profit zooms 418% in Apr-Jun quarter AUTOMAKER MAHINDRA & Mahindra (M&M) on Friday posted a quantum leap in consolidated net profit at `2,196 crore for the first quarter ended June 30, driven by strong growth in auto and farm sectors. Net profit soared 418% from `424 crore posted for the same period a year ago. P4 Paytm revenues jump 89% to `1,680 crore REVENUES OF One97 Communications jumped 89% to `1,680 crore in Q1FY23, driven by strong monetisation in payments, device subscriptions and accelerated lending. The Ebitda loss (before ESOPs) declined by `93 crore quarter-on-quarter to `275 crore. P9 Nykaa profit jumps 42% to `5 crore BEAUTY PRODUCTS retailer Nykaa on Friday posted a 42.24% year-on-year jump in its consolidated net profit at `5.01 crore during the April-June quarter on the back of good topline growth and operating performance. Consolidated revenue from operations was up 40.56% at `1,148.4 crore. P4 TRADERS EXPECT 250 M ORDERS AS ‘HAR GHAR TIRANGA’ GAINS MOMENTUM Tricolour sales fly high as demand outstrips supply VAISHALI DAR & KUNAL DOLEY New Delhi, August 5 IN THE NATIONAL capital, Jai Singh Sharma, owner of Jai PadamShreeTradex,whichhas been in the business of supplying national flags for over 30 years, is a busy man. Used to making only about 1,000 flags till last year, the New Delhibasedtraderhasgotanorderof 7 million flags this time with a deadlineofAugust8.“Thisyear, businesshasbeenoutstanding on account of the ‘Har Ghar Tiranga’ campaign,” said Sharma, who has got orders from organisations like NTPC and Indian Railways, among others. The campaign, to run from August 13-15, initiated by the government to mark 75 years of India’s independence, has leftmanufacturersandsuppliers scrambling to meet demandfortheTricolour.Even on a conservative scale,there is a demand of over 250 million flags nationally, but traders have been able to produce and sell only 60 million so far, as per trade body Confederation of All India Traders (CAIT). “Thedemandissohighthat traders in Surat alone, the country’s largest textile market, have received orders for more than 50 million flags. Manufacturers are working EXPRESS PHOTO: ABHINAV SAHA The 'Har Ghar Tiranga' campaign, to run from August 13-15, was initiated by government to mark 75 years of India’s independence ■ ■ Traders have been able to produce and sell only 60 million so far, as per Tricolour being made at a shop in Sadar Bazaar, Delhi trade body CAIT round the clock to deliver on time. In all textile markets in Maharashtra, Delhi, Uttar Pradesh, Tamil Nadu, Madhya Pradesh, Chhattisgarh and Bihar,workers everywhere are only making flags, leaving all other work aside,” CAIT secretary-generalPraveenKhandelwal said. Flags of sizes 9x6 ■ Flags of sizes 9x6 inches, 18x12, 16x24, 20x30 and 53x35 inches are most in demand, say traders inches, 18x12 inches, 16x24 inches, 20x30 inches and 53x35 inches are most in demand,he told FE. Thehigherdemandhasalso meantthatmoreandmorepeople are being roped in to make the flags.“We have employed over 500 women from nearby areastostitchflags.Onanaverage,onewomancanstitchupto 20flagsdependingonsize,said AnilRoongta,directorofNipun Technoweaves, Surat, one of thebiggestsuppliersofnational flags in India. “This time, the spirit is also very different because of the campaign,” he added. Retailers’spirits are equally high. Mahendra Arora of Muskaan Enterprises, a shop located in the Sadar Bazar area ofDelhi,saysbusinesshasdoubled thisyear.“We have been in this business for about 25 years, but this is the first time we have seen such demand,” Arora said. After the Central government allowed firms to spend corporate social responsibility (CSR) funds on the campaign, several corporate houses have also come forward to order flags in bulk. Adani Enterprises, the flagship entity of Adani Group, is procuring one lakh flags,which are being prepared by a Godda-based (Jharkhand)women’s self-help group.Simultaneously,10,000 cotton flags are being stitched by a women’s self-help group in Surguja in Chhattisgarh. Continued on Page 2 Kolkata
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