Business Live : Tata Sons moves SC against NCLAT order on Cyrus Mistry

File photo of Ratan Tata (left) with Cyrus Mistry.

File photo of Ratan Tata (left) with Cyrus Mistry.   | Photo Credit: PTI

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Indian markets made a cautious start to the first day of the new year. But today's trading has been bullish with a broad-based rally across sectors. Both the Nifty and the Sensex have gained over 0.6% during the day.

2:00 PM

Shares of Ashok Leyland rally; Bosch India shares swing

Ashok Leyland's shares have jumped over 3% in trading today after the company reported a 10% rise in sales in December when compared to November sales. The auto-manufacturer still reported a 28% fall in overall sales from last December.

Meanwhile, shares of Bosch India have witnessed huge swings during the day as reports have emerged of possible job cuts by the company.

Business Live : Tata Sons moves SC against NCLAT order on Cyrus Mistry
 

 

1:30 PM

Significant reversal: On NCLAT decision on Mistry

"With the Tata Group clear that it plans to challenge the NCLAT verdict, it will be left to the Supreme Court to have the final say on the conclusions of the NCLAT, particularly on the question of whether Tata Sons is in effect a “quasi-partnership”. This construct was, after all, the basis for the NCLAT’s reasoning that the company had always been run on mutual trust and understanding between the Tata and SP groups — a trust that the appellate body would like to see restored post its ruling," an editorial in The Hindu noted last week.

 

1:00 PM

Tata Sons moves Supreme Court against NCLAT order on Cyrus Mistry

Salt-to-software conglomerate Tata Sons on Thursday appealed in the Supreme Court against the December 18 decision of the National Company Law Appellate Tribunal (NCLAT) that restored Cyrus Mistry as the company’s executive chairman while declaring the appointment of N. Chandrasekaran in his place as illegal.

Tata has sought an early hearing of its appeal by the Supreme Court. The court re-opens after winter vacation on January 6.

Mr. Mistry was abruptly removed as executive chairman in October 2016. The NCLAT Bench led by chairperson Justice S.J. Mukhopadhyay termed his removal as oppressive. Read more here.

 

12:10 PM

Stocks clock strong morning session

Both the Nifty and the Sensex are up 0.5%

The mid-cap and small cap indices are up by around 1%

The rising tide has helped shares of Gujarat Narmada Valley Fertilizers Ltd. beat some bad news at the day's open. The Telecom Ministry, the company announced, has demanded from it ₹15,000 crore in overdue fees.

Business Live : Tata Sons moves SC against NCLAT order on Cyrus Mistry
 

 

 

11:20 AM

India's Dec factory activity picks up to 7-month high but business optimism weakens

India's factory activity expanded at its fastest pace in seven months in December as a jump in new orders prompted companies to ramp up production, a private business survey showed on Thursday.

Business optimism fell to an almost three-year low, however, as companies worried about challenging market conditions.

The Nikkei Manufacturing Purchasing Managers' Index , compiled by IHS Markit, rose to 52.7 in the final month of 2019 from November's 51.2.

The reading was the highest since May. It also remained above the 50-mark that separates growth from contraction for a 29th month, the longest since July 2013.

The PMI survey also showed optimism about output over the coming 12 months declined to its lowest since February 2017. Reuters

 

10:45 AM

A lot of pessimism on the economic growth front.

‘India will struggle to post 5% GDP growth in 2020’

India will “struggle” to achieve 5 per cent GDP growth in 2020 as the significant deceleration in past few quarters was largely owing to credit squeeze which is a cyclical problem, said noted American economist Steve Hanke.

Hanke, who currently teaches applied economics at Johns Hopkins University in the US, pointed out that India experienced an unsustainable credit boom, and now the chickens are coming to roost with a massive pile of non-performing loans piled up, primarily at the state-owned banks.

“The slowdown in India is related to a credit squeeze, which is a cyclical problem — not a structural problem... As a result, India will struggle to make a GDP growth rate of 5 per cent in 2020,” he told PTI in an interview.

He also noted that India is already highly protectionist.

Hanke, who had served on former US President Ronald Reagan’s Council of Economic Advisers, further said that the Modi government has failed to make any big economic reforms. PTI

 

But not everyone agrees: Reforms to spur recovery in 2020: India Inc.

An explainer on the economic slowdown: Is the economy in really bad shape?

10:05 AM

As the debate rages on whether the Indian government should loosen its purse strings to give a boost to economic growth, here's an update on the fiscal side.

Details of Indian govt borrowings in 2019/20

The Indian government plans to raise 9.47 trillion rupees through market borrowings in the fiscal year 2019/20 which starts April 1, the Reserve Bank of India said. The budgeted gross government borrowing for 2019/20 stands at 9.47 trillion rupees which includes government bonds and inflation indexed bonds. So far in the financial year the gross market borrowing stands at 7913.4836 billion rupees which includes 6340.567 billion rupees borrowed through 171 Government Bond issues, 733.98083 billion rupees issued through switching operations and 1572.917 billion rupees through 40 Treasury Bill issues. This is 74.71 percent of the gross amount. Reuters

Also read:

Apr-Nov fiscal deficit, a tad higher at 115% of 2019-20 target

How not to counter economic stagnation

 

9:45 AM

The Sensex and the Nifty have made a pretty decent start to the day with gains of over 0.3% each.

The rally seems to be broad-based for now, quite unlike last year, with mid-cap and small-cap stocks too participating in the morning rally. The Nifty Smallcap 250 has risen close to 0.5% since open.

Most stocks within the Nifty are also in the green at the moment with far more advances than declines:

Business Live : Tata Sons moves SC against NCLAT order on Cyrus Mistry
 

 

9:15 AM

 

East Asian markets have opened their first day of trading this year on a positive note.

Asian shares rise on China's policy easing, trade deal hopes

Asian shares kicked off the new decade higher on Thursday, after global stocks ended the previous one at record highs, and buoyed by Chinese markets after Beijing eased monetary policy to support slowing growth.

Investors also cheered news that the United States and China will sign a trade pact soon after a year of volatile negotiations between the world's two largest economies.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.35% in morning trade after rising 5.6% in December.

In China, the blue-chip CSI300 index, one of the world's best-performing indexes last year, was 1.34% higher in early trade.

China's central bank on Wednesday that it would cut the amount of cash that banks must hold as reserves, releasing around 800 billion yuan in funds effective Jan. 6. Reuters

 

9:00 AM

In today's editorial, The Hindu points to some probable obstacles in the way of the new infrastructure plan.

Infrastructure push: On Centre's ₹102-lakh-crore plan

"Identifying the projects to be put on the pipeline is the easy part. Implementing and commissioning them will be the more difficult one. There are a few hurdles that the NIP task force needs to watch out for. First, the financing plan assumes that the Centre and the States will fund 39% each while the private sector will chip in with 22% of the outlay. Going by the present fiscal situation, it will be no small challenge for the Centre to raise ₹39 lakh crore, even if it is over the next five years. The financial position of States is even more perilous. Second, the ₹22 lakh crore expected from private investment also looks steep considering the lack of appetite for fresh investment by the private sector in the last few years. In fact, this factor has been a major drag on economic growth. Given the scale of investment, debt will play an important role and it remains to be seen if banks have gotten over their apprehensions on infrastructure financing as a major part of their bad loans originated there." Read more here.

Also read:

Issues in the Centre’s infrastructure push

Infra push: Analysts remain cautiously optimistic

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Printable version | Feb 22, 2020 10:20:33 PM | https://www.thehindu.com/business/businesslive-02-jan-2020/article30457228.ece

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