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QBiz: Big Four Audit Firms Barred from Practising Law & More

1. Big Four Audit Firms Barred from Practising Law, Offering Legal Services

Acting on charges of surrogate law practice, the Bar Council of Delhi has directed the Big Four global audit firms — KPMG, PwC, EY and Deloitte — to refrain from providing legal services with immediate effect until further orders.

The firms have also been asked to furnish a list of all the advocates who have been engaged by them, in any capacity, in any of their offices at any place.

These directions have been passed by the Delhi Bar Council following a complaint filed by Lalit Bhasin, President of the Society of Indian Law Firms, a representative body of over 100 law firms in the country. The matter will be heard next by the Bar Council of Delhi on 12 July.

The Bar Council’s move is a step in the right direction, Bhasin told BusinessLine.

(Source: The Hindu Business Line)

2. NSE Considers Caps on Nifty's Sector Weights; Move May Hit Financial Stocks

The National Stock Exchange of India (NSE) is considering capping sectoral weights in the benchmark Nifty50 index, a move that could trigger a sell-off in financial stocks. The proposal is aimed at providing more diversity and reducing the concentration of one sector.

The Nifty, considered a barometer of the Indian economy, has the representation of 13 sectors through 50 stocks. However, financials, which include banks and non-banking financial companies (NBFCs), alone account for over 37 percent of the index weight, exerting a disproportionately high influence on the market.

(Source: Business Standard)

3. No Gold Shifted Outside India in 2014 or Thereafter, Says RBI Refuting Reports

The Reserve Bank of India (RBI) on Friday, 3 May, said no gold was shifted outside the country in 2014 or thereafter.

The statement comes against the backdrop of reports in certain sections of the print and social media regarding the central bank shifting abroad a part of its gold holding in 2014.

It is a normal practice for central banks world over to keep their gold reserves overseas with central banks of other countries like Bank of England for safe custody, according to the statement.

"It is further stated that no gold was shifted by the RBI from India to other countries in 2014 or thereafter. Thus the media reports cited above are factually incorrect," the statement said.

(Source: Livemint)

4. Godrej Properties Buys Mumbai’s Iconic RK Studios; Market Value Pegged at Rs 200 Crore

Godrej Properties has acquired the iconic RK Studios property located in suburban Chembur, established by Bollywood legend Raj Kapoor in 1948. While the deal size was not disclosed, the value of the property at market price is estimated at around Rs 200 crore.

Godrej Properties’ new project on the 2.2-acre site will offer approximately 33,000 sq metres of saleable area comprising residential apartments of various configurations as well as luxury retail space.

The studio has seen the production of Hindi blockbusters such as Awaara, Shri 420, Satyam Shivam Sundaram and Bobby.

(Source: The Hindu Business Line)

5. Govt Likely to Allot Jet Airways' Overseas Traffic Rights to Other Airlines

Domestic airlines have sought the government’s nod to start flights to Dubai, Singapore and other destinations using traffic rights held by Jet Airways. The civil aviation ministry is considering the request and has asked the airlines for their requirement and capacity deployment plans.

On Friday, 3 May, Civil Aviation Secretary Pradeep Singh Kharola met representatives of domestic airlines, including Air India, IndiGo, SpiceJet and Vistara, which want to launch new overseas flights. “The airlines have been asked to give in writing their requirements and inform how quickly can they deploy capacity. The ministry may consider giving the traffic rights to other airlines for 3-4 months,” said an aviation source aware of the development.

(Source: Business Standard)

6. $2 Billion: Amount Anil Ambani Needs in Asset Sales to Save Last Stronghold

The last stronghold in embattled tycoon Anil Ambani’s phone carrier-to-power empire is also developing fault lines.

Reliance Capital Ltd, his financial services business that almost doubled its profit in five years, had largely remained insulated from the distress plaguing the wider conglomerate. Now, the company that controls India’s fifth-biggest mutual fund, is racing to close a planned $2 billion of asset sales to bolster its finances after cash dwindled to Rs 110 million ($1.6 million) as of March, according to CARE Ratings.

With $252 million of debt falling due over May and June, a unit of Moody’s Investors Service and two other local firms have slashed ratings of Reliance Capital or its short-term instruments, citing holdups in asset sales, deteriorating liquidity and risks on loans to unprofitable affiliates.

(Source: Business Standard)

7. Vodafone-Idea Signs Multi-Million Dollar IT Deal with IBM

India's largest telecom operator Vodafone Idea Ltd on Friday, 3 May, announced a five-year multi-million-dollar IT outsourcing deal with tech giant IBM.

"This engagement will also contribute to Vodafone Idea's merger synergy objectives by reducing its IT related costs," the telecom firm said in a statement.

The company did not divulge the size of the deal but some reports pegged it at about $700 million.

"The collaboration will provide Vodafone Idea with a hybrid cloud based digital platform to enable more intimate engagement with its over 387 million subscribers (as of 31 December, 2018), enhancing business efficiency, agility and scale plus simplification of its business processes," it said.

(Source: Livemint)

8. HUL Q4 Profit Rises 14% Y-o-Y to Rs 1,538 Crore; Misses Street Estimates

FMCG major Hindustan Unilever on Friday, 3 May, reported 14 percent Year-on-year (Y-o-Y) rise in net profit at Rs 1,538 crore for the March quarter, which was well below Rs 1,617 crore profit estimated by analysts in an ET Now poll.

The company had reported Rs 1,351 crore profit in the year-ago quarter. Revenue for the quarter rose 8.94 per cent YoY to Rs 9,808 crore compared with Rs 9,003 crore in the same quarter last year.

Volume for the quarter grew at 7 percent, in line with estimates. Domestic consumer growth stood at 9 percent, the company said in a BSE filing.

Ebitda margin for the quarter improved 90 basis points, HUL said.

(Source: The Economic Times)

9. Spate of NBFC Downgrades Raise Fresh Liquidity Fears

A spate of rating downgrades over the past fortnight has stoked fears of another impending liquidity crisis in the non-banking financial company (NBFC) sector, with a cascading effect on the broader markets that have been on a fragile road to recovery since the Infrastructure Leasing & Financial Services (IL&FS) crisis broke out last September.

In recent weeks, rating agencies have revised credit ratings of certain debt instruments of Reliance Capital firms Reliance Commercial Finance (RCFL) and Reliance Home Finance (RHFL) to “default", or D, on account of the deteriorating financial profile of its parent.

Industry watchers said the latest developments are likely to raise fresh concerns of asset-liability mismatch, which in turn, could further push up the cost of funds for the NBFCs and HFCs, which are already reeling under tight liquidity conditions.

(Source: Livemint)

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