Business Live: Telcos may default on spectrum auction dues over AGR payment

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File photo used fore representational purpose.   | Photo Credit: Reuters

News updates from the world of economy, markets, and finance

 

4:00 PM

Telcos may default on spectrum auction dues over AGR payments: Motilal Oswal

The new stress that could now emerge for government and banks despite winning the AGR battle against the telcos in the Supreme Court is the strong possibility of telecom companies defaulting on last spectrum auction dues payment to the tune of Rs 90,000 crore, analyst firm Motilal Oswal has said.

“Ironically, the government, despite winning the suit, could see the biggest impact through deferred spectrum debt default of Rs 900 billion”, broking firm Motilal Oswal said in a report.

Earlier this month, Department of telecom (DoT) amended license to defer payments of the spectrum auction instalments due for 2020—21 and 2021—22, operationalising the committee of secretaries’ decision to allow a two—year moratorium as decided by the Committee of Secretaries headed by Cabinet Secretary Rajeev Gauba. IANS

3:50 PM

Indian industry seeks cut in import duties to tackle disruptions due to coronavirus

Indian business leaders are demanding cuts in import duties on antibiotic drugs, mobile parts and other items as the outbreak of the coronavirus has disrupted supplies from China, government and industry officials said.

The outbreak of the virus in China has hit India's manufacturing and exports of medicines, electronic, textile and chemicals as China is the biggest source of intermediate goods, worth $30 billion a year, according to a presentation by the Confederation of Indian Industries (CII), seen by Reuters.

The confederation will show the presentation on Tuesday when Finance Minister Nirmala Sitharaman meets more than 200 business leaders to assess the impact of the coronavirus and discuss plans to contain the damages.

The government should “remove higher import duties on certain products, primarily imported from China” but available in other countries, the presentation by the CII said. Reuters

3:40 PM

European shares slump as Apple warning hammers tech sector

European shares dropped on Tuesday as a revenue warning from Apple Inc sent shockwaves through the tech sector, hammering iPhone parts makers and underlining the impact of the coronavirus outbreak on global supply chains.

Apple's Frankfurt-listed shares dropped nearly 5% after the company said it would miss its March quarter sales outlook due to the epidemic, which has killed more than 1,800 people and forced businesses to shut operations.

Shares of STMicroelectronics NV and Dialog Semiconductor PLC, which supply components to Apple, fell 3% and 4.8%, respectively.

The technology-heavy German stock index plunged 0.7%, while the European tech subindex fell 1%. Reuters

3:30 PM

Ind-Ra revises outlook on textile sector to negative from stable

Rating agency Ind-Ra has revised the outlook on India’s textile sector to negative from stable for 2020-21 as weak domestic demand growth, threat of cheap imports and dwindling incentives and exports are likely to keep volumes muted.

Ind-Ra expects withdrawal of incentives under the merchandise exports from India scheme (MEIS) to affect export players of made-ups (home textiles) and garments.

“Exporters are likely to remain uncompetitive against counterparts in Pakistan, Bangladesh, Turkey and Vietnam, due to further delays in the implementation of Rebate of State and Centre levy of Taxes. All these factors would lead to margin pressures for exporters in FY21,” India Ratings and Research (Ind-Ra) said.

However, it expects key raw material prices to remain low in 2020-21, after a correction in 2019-20, contributing to a modest recovery in margins, stable working capital requirements and steady cash flows. PTI

3:20 PM

China to waive tariffs on US medical imports amid virus outbreak

China will waive trade-war tariffs on imports of selected US medical equipment from March 2, the government said Tuesday, as the country battles to contain the new coronavirus epidemic.

The move comes as doctors and nurses treating virus patients in China’s overstretched hospitals struggle to deal with the health crisis amid a shortage of basic medical items.

More than 72,000 people have been infected by the outbreak of the new COVID-19 strain in China, which has claimed the lives of over 1,800 people.

Patient monitors, blood transfusion equipment and instruments to measure blood pressure are among the products that qualify for the exemptions, according to a list released by the Tariff Commission of the State Council. Reuters

3:10 PM

Irdai says ‘yet to get’ proposal from LIC on IPO

Insurance regulator is yet to get any proposal from LIC on an initial public offering, but feels a listing is better from a governance perspective, chairman S C Khuntia said on Tuesday.

He also said that there is nothing for the life insurance industry to worry for the time being with regard to government’s move on certain income tax exemptions as the alternative to invest still exists.

Khuntia also asked insurance companies to “weed out” loss-making products and concentrate only on the better paying ones.

On the IPO of Life Insurance Corporation of India announced in the budget, he said, “LIC proposal has not yet come.”

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3:00 PM

UP budget lays emphasis on metro networks, airports, e-ways

The Uttar Pradesh government in its Budget 2020-21, presented in the state Assembly on Tuesday, has laid emphasis on developing metro networks, airports and expressways, besides fixing a target to build four lakh houses for weaker sections by March 2021.

“A target of constructing 4 lakh houses for weaker sections has been fixed by March 2021. Metro rail service is available in Lucknow, Ghaziabad and Noida. Work of Regional Rapid Transit System from Delhi to Meerut is in progress. An arrangement of Rs 900 crore made for it,” Finance Minister Suresh Kumar Khanna said in his budget speech. PTI

2:45 PM

India requires one city of Chicago size to be built every year for next ten years: Aghi

The scale of urbanisation in India requires one city of the size of Chicago to be built every year for the next 10 years, the head of a top American business advocacy group has said.

In a panel discussion ‘Smart Cities in India: Challenges and Opportunities’ at India Conference organised by the Harvard University over the weekend, Mukesh Aghi, president of the US India Strategic and Partnership Forum (USISPF) emphasised that the need of a robust public-private-partnership for funding all Smart Cities projects following the success path of Singapore.

“The enormity of urbanisation in India requires one city of Chicago size to be built every year for next ten years,” Aghi said. PTI

2:30 PM

Housing sales bookings of top 9 listed realty firms up 2% at nearly Rs 5,800 crore

Housing sales bookings of top 9 listed real estate developers rose 2 per cent to nearly Rs 5,800 crore during the third quarter of this fiscal year, according to property consultant Anarock.

Sales bookings of DLF, Sobha, Puravankara, Prestige Estates, Brigade Enterprises, Mahindra Lifespace Developers, Godrej Properties, Oberoi Realty and Kolte Patil have been taken into account.

“Housing sales revenue of the top 9 stock exchange-listed developers continued to grow steadily in the last festive quarter. Despite all headwinds, their collective revenues in third quarter of fiscal 2020 stood at a little less than Rs 5,800 crore, increasing 4 per cent on a quarterly basis and 2 per cent in a year,” Anarock said. PTI

2:10 PM

Birla meets Telecom Secretary amid AGR issues

Amid talks of the government encashing its bank guarantee over default in payment of dues, Vodafone Idea Chairman Kumar Mangalam Birla met Telecom Secretary Anshu Prakash on Tuesday as he looked for options to keep the company afloat.

After the meeting, Birla said he “cannot say anything at the moment.”

Vodafone Idea on Monday paid Rs 2,500 crore to the Department of Telecom (DoT) and promised to pay another Rs 1,000 crore before the end of the week.

But the amount paid for now is less than 5 per cent of the dues that the DoT estimates the company owes to the government following a Supreme Court ruling that asked for including non-telecom revenues of telcos in computing statutory payments such as licence fee and spectrum charges. PTI

2:10 PM

Barbeque Nation files IPO papers to raise Rs 1,000-1,200 crore

Casual dining chain Barbeque Nation Hospitality has filed fresh papers with markets regulator Sebi to raise an estimated Rs 1,000-1,200 crore through an initial public offering.

The IPO comprises a fresh issue of shares worth Rs 275 crore and an offer-for-sale of up to 98,22,947 equity shares, according to the draft papers filed with the Securities and Exchange Board of India (Sebi). The company may consider a pre-IPO placement to the tune of Rs 150 crore.

Proceeds of the issue will be utilised to repay an outstanding borrowing of Rs 205 crore in part or full and for general corporate purposes. PTI

2:00 PM

Sugar exports expected to pick up

M. Soundariya Preetha reports:

Nearly 16 lakh tonnes of sugar have been exported so far this season of the 32 lakh tonnes for which contracts have been signed.

According to the Indian Sugar Mill Association (ISMA), few sugar mills do not plan to export sugar against their allocated export quotas and some have surrendered a part of their MAEQ (Maximum Admissible Export Quantity) to the Government. It is understood that the Government is actively considering reallocation of quotas of mills that have not contracted the stipulated quantity for exports, the Association said.

There is said to be nearly nine million tonnes deficit in the global market during 2019-2020 sugar season and Thailand's exports are likely to be three million to four million tonnes lesser due to lower production there. Global sugar prices for raw and white sugar are currently at 20% to 25% more than the prices that prevailed three months ago, when India started its exports. Accordingly, Indian sugar exports may get accelerated in the coming months, the ISMA said.

1:50 PM

HSBC announces job cuts and radical overhaul as profits slide

HSBC announced a radical overhaul on Tuesday, including plans to slash 35,000 jobs and slim operations in the United States and Europe, after profits slid by a third last year.

The Asia-focused lender has been trying to lower costs as it faces a multitude of uncertainties caused by the grinding US-China trade war, Britain’s departure from the European Union and now the deadly new coronavirus in China.

While its Asia business has done well in recent years -- fuelled primarily by China -- Europe and the US have disappointed.

Noel Quinn, who took over as acting CEO after the shock ouster in August of John Flint, has been tasked with transforming the sprawling international bank, which spans more than 50 countries but makes the vast majority of its profit in Asia. Reuters

1:40 PM

CCI procures cotton at MSP

M. Soundariya Preetha reports:

Cotton Corporation of India (CCI) has procured more than 60 lakh bales of cotton so far this season at Minimum Support Price (MSP), the Chairman and Managing Director of CCI P. Alli Rani told The Hindu. 60% of the estimated cotton production has come into the market so far this season, which started in October 2019 and will end in September this year, she said.

Of the total arrivals, the CCI has procured 28%. The Cotton Advisory Board’s provisional cotton production estimate for this season is 360 lakh bales.

The CCI has nine lakh bales stock of cotton from the previous seasons and 60 lakh bales of this season. Substantial quantity of the cotton procured so far this season is from Telangana, Ms. Rani said.

1:30 PM

Nissan shareholders furious at Ghosn scandal, dismal results

Nissan shareholders vented their outrage at the Japanese automaker’s top management Tuesday for crashing stock prices, zero dividends and quarterly losses after the scandal-ridden departure of former Chairman Carlos Ghosn.

They got up, one by one, at an extraordinary shareholders’ meeting, demanding that Nissan Motor Co. quickly fix diving car sales, work harder to repair its battered brand and have executives give up their pay.

Ghosn, a superstar executive who had led Nissan for two decades, was arrested in November 2018. He was awaiting trial on financial misconduct charges in Tokyo when he skipped bail late last year and escaped to Lebanon.

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1:15 PM

RIL drops, shares of three group entities surge on consolidation move

Reliance Industries Ltd (RIL) shares traded marginally lower by 0.91 per cent on Tuesday after the company announced consolidation of all its media and distribution businesses under flagship ‘Network18’

Shares of Network18 Media & Investments traded 4.89 per cent higher at Rs 30.05 on the BSE. RIL stock traded at Rs 1,465.

While shares of the three group entities namely Hathway Cable & Datacom, Den Networks and TV18 Broadcast -- which have been merged into Network18 -- rose as much as 20 per cent.

Hathway Cable & Datacom gained 20 per cent to hit upper circuit at Rs 23.10 on the BSE. Den Networks stock also touched the upper price band after gaining 9.98 per cent to Rs 59.50.

TV18 Broadcast scrip was trading higher by 12.72 per cent at Rs 28.35. PTI

1:00 PM

SoftBank spends $2.5 billion to get second Vision Fund off the ground

SoftBank Group Corp has pumped $2.5 billion of its own cash into new investments since October, people familiar with the matter said, hoping to restore its money-making credentials as it courts investors for a successor to its Vision Fund.

The Japanese technology conglomerate is also considering investing another $2.5 billion of its own money, one of the people said.

SoftBank Chief Executive Masayoshi Son said last week the company may spend up to two years investing its own money in a bridge fund, to build a portfolio that will give investors enough confidence to participate in a second Vision Fund. To that end, he said SoftBank has already invested “billions” of U.S. dollars, but he did not provide an exact figure. Reuters

12:45 PM

Singapore Airlines to cut flights as coronavirus outbreak hits demand

Singapore Airlines on Tuesday said that it will temporarily cut flights across its global network, including Mumbai, in the three months to May as the deadly coronavirus outbreak has impacted the flight demand to the city-state.

Key affected destinations include Mumbai, Frankfurt, Jakarta, London, Los Angeles, Paris, Seoul, Sydney and Tokyo, the airline said in a statement.

The coronavirus epidemic has hit demand for services to Singapore as well as through the key transit hub. The outbreak began in Wuhan, capital of central China’s Hubei province, in December and has now spread across the globe.

Singapore’s tally of 77 cases of the virus is one of the highest outside mainland China. PTI

12:30 PM

Vodafone Idea stock falls over 16% on rating downgrade

Shares of Vodafone Idea on Tuesday tanked over 16 per cent due to rating downgrade on AGR dues and other issues of the company. On the BSE, the stock plunged 14.91 per cent to trade at Rs 2.91 in early market hours. Later it was trading with a loss of 8.77 per cent at Rs 3.12.

The scrip plummeted to a low of Rs 2.85, down 16.17 per cent, on the NSE. It was trading 7.35 per cent lower at Rs 3.15.

Vodafone Idea on Monday said Care Ratings has downgraded rating on its long-term bank facilities and non-convertible debentures.

The downgrade is on account of “significant erosion” in the overall risk profile of the company in the wake of absence of relief on modification plea relating to AGR dues on February 14. PTI

12:20 PM

Free WiFi to continue after Google partnership ends: Railways

A day after the Google announced that it is gradually winding down its free public WiFi Station programme, currently available at 415 railway stations in India, the Railways has assured the continuation of the free WiFi services at these stations.

The Google had said that it will work with the Indian Railways and Railtel Corporation to help them with existing sites so they can remain useful resources for people. The Railways contract with the search engine ends in May 2020. IANS

12:10 PM

Hero MotoCorp to invest Rs 10,000 crore in R&D, other activities

The country’s largest two-wheeler maker Hero MotoCorp on Tuesday announced investment of Rs 10,000 crore over the next 5-7 years on various activities, including research and development and setting up new manufacturing facilities.

Announcing that the company’s Vision 2020 will “be the future of mobility”, Hero MotoCorp Chairman and Managing Director Pawan Munjal said the company also aims to be carbon neutral by 2030.

“Today even as we continue to rationalise our costs, we will not leave any stone unturned to realise our Vision of ‘The Future of Mobility’

“Over the next five to seven years, we would be investing around Rs 10,000 crore in research and development of alternative mobility solutions, modern, state-of-the-art, sustainable manufacturing facilities, network expansion, and brand building across the globe,” Munjal said. PTI

12:00 PM

Recession risk forces Bank of Japan to row back on inflation goal

The widening economic fallout from the coronavirus outbreak and soft consumption are forcing the Bank of Japan to message more strongly that it is no longer inclined to chase its elusive 2% inflation target, sources familiar with its thinking say.

After years of trying to vanquish deflation by setting an ambitious price goal, Japan's waning recovery prospects and a dwindling policy tool-kit have made the BOJ more open to conceding that the best it can do is to keep the economy afloat, the sources said.

The need to protect the world's third-largest economy from a sharp downturn has became a more urgent task for the BOJ, particularly as external risks such the Sino-U.S. trade war and a coronavirus outbreak in China weaken its ability to create a virtuous growth cycle. Reuters

11:45 AM

No headway in India-U.S. trade talks

With no significant movement on the India-U.S. trade negotiations yet, officials are considering taking even a modest trade deal off the table when U.S. President Donald Trump visits India on February 24-25, sources privy to the talks said.

As The Hindu had reported on Friday, U.S. Trade Representative Robert Lightizer was due to visit New Delhi last week, but put off the visit when it appeared there was not enough progress in the talks, that appear to have run into trouble over market access for agricultural products including dairy, liberalising e-commerce, and investment norms for retail, as well as India’s push for a full reinstatement of its GSP (Generalised System of Preferences) status that the U.S. revoked last June.

Mr. Lightizer and Commerce Minister Piyush Goyal have not spoken since last Thursday, it is learnt, and after another unsuccessful attempt to reschedule Mr. Lightizer’s visit over the weekend, officials are beginning to feel that time may be running out to wrap up negotiations in time for the presidential visit.

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11:30 AM

DHFL stock zooms to hit upper circuit as over two dozen entities interested in takeover

Shares of Dewan Housing Finance Corporation Ltd on Tuesday shot up 5 per cent to hit upper price band after more than two dozen entities put in bids to takeover the debt-laden firm.

The stock zoomed 4.97 per cent to Rs 10.34 apiece on the BSE.

On the NSE, the stock rose 4.59 per cent to Rs 10.25 a unit.

Its shares hit the upper price band on both the stock exchanges.

Adani Group, KKR, Bain Capital, Kotak Mahindra Bank and Piramal Enterprises are among the more than two dozen entities that have put in bids for crippled DHFL, the first financial services player undergoing insolvency process, according to two sources. PTI

11:20 AM

China to grant tariff exemptions on additional US goods

China said on Tuesday it would accept applications for new tariff exemptions for 696 products imported from the United States including key agricultural and energy products such as pork, beef, soybeans, liquefied natural gas and crude oil.

The exemptions, the third and the most substantial set to be granted to date by China since the start of the trade dispute with the United States, come a month after the signing of a Phase 1 trade deal between Washington and Beijing. China has committed to boosting its purchases of goods and services from the United States by $200 billion over two years. Reuters

11:10 AM

Apple warns coronavirus will cut iPhone production, sales

Apple Inc. is warning investors that it won’t meet its second-quarter financial guidance because the viral outbreak in China has cut production of iPhones.

The California-based company said Monday that all of its iPhone manufacturing facilities are outside Hubei province, the epicentre of the outbreak, and all have been reopened. But the company said production is ramping up slowly.

The health and well-being of every person who helps make these products possible is our paramount priority, and we are working in close consultation with our suppliers and public health experts as this ramp continues, Apple said in a statement.

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11:00 AM

Rupee slips 10 paise to 71.42 against US Dollar in opening deals

The Indian rupee declined by 10 paise to 71.42 against the U.S. Dollar in opening trade on Tuesday as investor sentiments remain fragile amid coronavirus fears.

Besides, foreign fund outflows, stronger dollar against key global currencies and subdued equity market too put pressure on the domestic unit.

The rupee opened weak at 71.42 at the interbank forex market and then fell further to 71.42, down 10 paise over its last close.

The rupee had settled at 71.32 against the U.S. Dollar on Monday.

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10:45 AM

India aims to be self-sufficient in coal production by 2024: Joshi

Union minister Pralhad Joshi has said the Centre aims self-sufficiency in the coal sector by 2024 and the changes in the coal mining policy have been effected to achieve the same.

Joshi -- Union Minister for Parliamentary Affairs, Mines and Coal -- was speaking at a two-day brainstorming session in Narmada district, about 100 km from Vadodara. Senior officials of the coal ministry, chairmen and managing directors of public sector undertakings are attending the event.

Joshi said India stood fifth in terms of coal reserves and the Centre was working towards achieving self-sufficiency in coal production. PTI

10:30 AM

After SC’s rap, telcos pay Rs. 14,697 crore to DoT

Telecom services providers, including Bharti Airtel, Vodafone Idea and Tata Group, on Monday cumulatively deposited Rs. 14,697 crore in part payment of their adjusted gross revenue dues with the Department of Telecommunications (DoT). While Bharti Airtel paid Rs. 10,000 crore, Vodafone Idea remitted Rs. 2,500 crore and the Tata Group deposited Rs. 2,197 crore.

Additionally, Vodafone Idea committed itself to paying another Rs. 1,000 crore by the end of this week.

This follows last week’s Supreme Court order that asked the managing directors and directors of the companies to show cause why contempt proceedings should not be initiated against them for failing to pay even a “single penny” to the government despite an October 2019 judgment.

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10:20 AM

RIL to consolidate media, distribution businesses

Reliance Industries Ltd. (RIL) plans to consolidate its media and distribution businesses spread across multiple entities into Network18, in a move that will make Network18 an integrated media and distribution company with a revenue of Rs. 8,000 crore.

“Under the Scheme of Arrangement, TV18 Broadcast, Hathway Cable & Datacom and Den Networks will merge into Network18 Media & Investments,” the company said in a statement, adding that the appointed date for the merger shall be February 1, 2020.

The board of directors of the respective companies approved the Scheme of Amalgamation and Arrangement at their meetings held on Monday.

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10:10 AM

Nifty, Sensex trade lower amidst overall weak trend

Ashish Rukhaiyar reports:

Indian equities traded lower in the morning session amidst an overall weak trend in the global markets after Apple Inc said that its quarterly sales could miss forecasts.

The 30-share Sensex, which traded marginally weak in the pre-open session, fell over 180 points within minutes of opening on Tuesday.

At 9:20, the index was trading at 40,875, down 181 points. The broader Nifty fell below the psychological 12,000- mark to trade at 11,991.55, down 54.25 points.

On BSE, nearly 700 stocks were in the red, as against less than 400 gainers. Among the Sensex pack, 26 stocks lost ground in the early trade with IT, M&M, IndusInd Bank, Tata Steel and Hero Motocorp all shedding over 1% each.

Elsewhere in Asia, Hang Seng and Nikkei were both trading lower by more than 1% each.

10:00 AM

Care downgrades rating on Vodafone Idea’s long term bank facilities, non-convertible debentures

Vodafone Idea on Monday said Care Ratings has downgraded rating on its long term bank facilities and non-convertible debentures.

The downgrade is on account of “significant erosion” in the overall risk profile of the company in the wake of absence of relief on modification plea relating to AGR dues on February 14.

It also takes cognizance of recent losses suffered by the company in the quarter ended December.

In a regulatory filing, Vodafone Idea said that Care Ratings Limited (CARE) has downgraded its rating on long term bank facilities and non-convertible debentures. The rating on long term bank facilities and non-convertible debentures has been revised to ‘BB-’ from ‘BBB-’ PTI

9:45 AM

India's poultry sales decline after coronavirus rumours linked to chickens

India's poultry industry has lost 13 billion rupees ($182 million) in three weeks after speculation on social media that chickens are a cause of the spread of coronavirus, denting demand for chicken and nearly halving prices, say industry officials.

Millions of small poultry farmers have been hit by a sudden drop in sales. Soybean and corn producers are also being affected with prices of both the commodities used in animal feed have falling up to 8% in the last three weeks.

While the disease has infected more than 70,000 people in China and killed at least 1,770 there, only three confirmed cases have been reported in India. However, rumours that coronavirus can be transmitted through chickens have appeared on the WhatsApp message platform in India prompting the authorities to issue a statement last week that eating chicken is safe. Reuters

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Printable version | Mar 29, 2020 9:26:38 AM | https://www.thehindu.com/business/businesslive-18-feb-2020/article30848948.ece

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