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QBiz: SEBI Tightens Norms; Telecoms Make Partial Payment

1. SEBI Tightens Norms for Investment Advisers to Prevent Mis-Selling

The markets regulator on Monday barred investment advisers from simultaneously selling financial products and advisory services, and capped the fees they can charge their clients, in an attempt to curb mis-selling and protect investors.

From now on, an entity can provide either advisory services or distribute financial products to a client, which has been defined as a family that includes dependent spouse, children and parents. The regulator also cleared norms for so-called regulatory sandboxes at its board meeting.

(Source: Livemint)

2. Oyo's Loss Rises Sevenfold but Says No Brakes on Expansion

SoftBank Group-backed Oyo Hotels and Homes will continue its expansion into international markets such as Latin America, China and the UK, senior company executives said, even as its losses surged sevenfold last fiscal.

The hospitality startup will also focus on turning profitable in its home market India, where its margins improved 4.1% in 2018-19, Oyo board member Aditya Ghosh said in a conference call with reporters to discuss the audited financial results for FY19.

Ghosh did not say when Oyo could start making profits.

(Source: Livemint)

3. Vodafone Idea, Airtel Make Partial Payments After SC Tough Talk

Vodafone Idea Ltd and Bharti Airtel Ltd, the worst affected by the top court’s verdict on the adjusted gross revenue case, made partial payments of their dues to the government on Monday after the court pulled up the operators for failing to meet the payment deadline set by it.

Vodafone Idea’s board on Monday decided to immediately pay ₹2,500 crore to the department of telecommunications (DoT) and pay an additional ₹1,000 crore before the end of the week. “The board will take further stock of the situation to see how additional payments can be made," Vodafone Idea said in an exchange filing. Vodafone Idea’s dues total about ₹50,000 crore, according to government estimates.

On the same day, Bharti Airtel paid ₹10,000 crore out of its total dues of ₹35,586 crore to DoT.

(Source: Livemint)

4. PSUs Still Not Safe, AGR Disputes to Rise

The government, and the management of PSUs like Gail and Powergrid are probably breathing a little easier now that the Supreme Court (SC) has told PSUs that they can challenge the Rs 3 lakh crore of Department of Telecommunications (DoT) notices at the Telecom Dispute Settlement and Appellate Tribunal (Tdsat). While the problem of what happens to the country’s investment climate and the Rs 2.2 lakh crore Vodafone Idea owes the government (and the Rs 49,000 crore it owes to banks) remains – with the telco tottering on the brink of insolvency – at least the PSUs are safe for now.

Powergrid has been given a bill of Rs 1.3 lakh crore by DoT, Gail has one for Rs 1.7 lakh crore, and the Delhi Metro for Rs 33,000 crore. If all goes to plan, the Tdsat will rule that the SC verdict on adjusted gross revenues (AGR) doesn’t apply to the PSUs, and since the government won’t challenge the verdict, the PSUs will no longer have to pay the money; if they had to, they would have been wiped out.

(Source: Financial Express)

5. Slower Recovery: Moody’s Cuts India Growth Estimates

Moody’s Investors Service on Monday cut its India GDP growth forecast for 2019 (calender) by 60 bps to 5% and by a sharper 120 bps to 5.4% for 2020, in what reflected a continuing trend of such downward revisions by prominent domestic and foreign agencies.

“While the economy may well begin to recover in the current quarter, we expect any recovery to be slower than we had previously expected. Accordingly, we have revised our growth forecasts to 5.4% for 2020 and 5.8% for 2021, down from our previous projections of 6.6% and 6.7%, respectively,” Moody’s said in its latest Global Macro Outlook report.

(Source: Financial Express)

6. Cyrus Mistry Moves Supreme Court Seeking Directorship at Tata Sons

Cyrus Mistry and his investment firms have filed a fresh petition in the Supreme Court, pleading that they be granted directorship in Tata Sons Ltd.

In the petition filed on 13 February, the Mistry firms – Cyrus Investments Pvt Ltd and Sterling Investments Pvt Ltd – which together own 18.4% of ordinary shares in Tata Sons, said the National Company Law Appellate Tribunal (NCLAT) did not grant them the reliefs that they had sought.

(Source: Livemint)

7. JSW Acquires GMR’s 1,050 MW Odisha Power Unit in Rs 5,321 Crore Deal

JSW Energy Ltd said Monday that it will take over 100% stake in GMR Kamalanga Energy Ltd (GKEL) ― the business unit of GMR Infrastructure that houses the 1,050 mega-watt (MW) thermal power plant in Odisha ― for Rs 5,321 crore. After the acquisition, JSW Energy’s installed power generation capacity would reach 5,609 MW. About 84% of the power plant’s capacity supplies electricity to Odisha, Haryana and Bihar under long-term power purchase agreements. It also has adequate coal supply arrangements from nearby mines, reducing fuel costs and resulting in lower risks of under-recoveries.

The deal will help GMR Infrastructure reduce its debt of Rs 4,141 crore which the company owed to IDFC (lead lender), SBI, IDBI, Canara Bank and UCO Bank. GMR had infused equity of Rs 2,250 crore into this power plant. It was not immediately known how much haircut has been borne by the lenders. Operating the plant did not turn out to be viable for GMR because the competitive rates (Rs 2.89/unit-Rs 3.39/unit) at which it sold power was not sufficient to recover the costs.

(Source: Financial Express)

8. Govt Scraps Tenders Worth Rs 30,000-Crore to Push Make in India Products

Government tenders worth about Rs 30,000 crore were cancelled because of discriminatory practices being followed, a top official said on Monday.

Restrictive and discriminative tender practices prevent participation of domestic companies in government procurement, hurting 'Make in India' initiatives.

The Department for Promotion of Industry and Internal Trade (DPIIT) from time to time has intervened to change conditions in those tenders in order to promote 'Made in India' goods.

(Source: Business Standard)

9. RIL Consolidates Media Biz: TV18, Hathway and Den to Merge Into Network18

Mukesh Ambani-led Reliance Industries (RIL) on Monday said it was consolidating its media and distribution business spread across multiple entities into Network18. This will pave the way for a Rs 8,000-crore company, second only to Star India, now acquired by Disney, which remains the largest media company in the country with revenue of Rs 12,341 crore (in 2018-19).

Under the scheme of arrangement, TV18 Broadcast, Hathway Cable & Datacom, and DEN Networks would merge into Network18, RIL said, with the appointed date for the merger being 1 February. The scheme will also simplify the corporate structure of the group by reducing the number of listed companies. RIL’s stake in Network18 would reduce to 64 percent, from 75 percent, following the merger.

(Source: Business Standard)

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