Tag Archives: Union Budget

Voda-Idea merger, Union Budget 2017, BSE listing- Weekly Digest #33

Monday-30th January 2017

  • Vodafone Group and Idea Cellular confirmed that they are in initial talks to merge the two entities, which will biggest consolidation in Indian Telecom History in a cashless deal. Both entities to hold equal rights in the new entity. Idea shot up 26% to ₹97.95 after the announcement.
  • Jaguar Land Rover has suspended its plans to manufacture SUVs in India as feasibility study didn’t favour the project.
  • District Court in Delhi has turned down an appeal by  Sweden’s IKEA against Bengaluru-based consulting company Aikya Global for using a phonetically similar name.
  • HDFC reported a 12% rise in its Q3 results, with its profit increasing from ₹1,521 crores to ₹1,701 crores on YoY basis. This has been attributed to growth from non-individual loans.
  • Tech Mahindra posted a 14% increase in net profit to ₹856 crores for Q3 at ₹856 crores owing to “the strong deal wins”.

 

Tuesday- 31st January 2017

  • The government said that it had identified 18 lakh accounts where substantial cash deposits took place post demonetization and they will be required to divulge the source. This comes as a part of the tax department’s Operation Clean Money Swachh Dhan Abhiyan initiative.
  • Honda announced that it is recalling around 41.580 cars over the issues of the faulty airbag inflators. This has been Hinda’s fourth recall during the period of last 2 years.
  • The possible merger of Idea and Vodafone along with the strong impact of Jio in the market caused Bharti Infratel’s Share to dip to its52 week low of ₹283.10.
  • ICICI Bank posted a 19% drop in net profit for the Q3 at ₹2,442 crores owing to slow loan growth rate.

 

Wednesday- 1st February 2017

  • Finance Minister Arun Jaitley presented the Union Budget 2017, highlights of which can be found here.
  • The market responded positively to the presentation of the Union Budget, as the Sensex surged nearly 486 points to close at 28,141 and the Nifty gained 155 points to 8,716.40. Both indices closed at their highest levels since October 25. Bank Nifty rose 2.6%.
  • Due to incentives to affordable housing in the budget, shares of housing companies such as Ashiana Housing, Puravankara surged up to 19%, while companies like Gruh Finance and DHFL, which provide loans to affordable housing, rose up to 8%.

 

Thursday- 2nd February 2017

  • The world’s largest e-commerce company, Alibaba is leading an investment round between ₹1,350crores and 1,700 crores in the online retail marketplace of PayTm. This will ensure formal entry of Alibaba in the Indian market to compete with Amazon and Flipkart.
  • Amazon has applied to the government of India to invest $500 million in a wholly owned venture in India to stock locally produced food items and sell them online.
  • Vodafone Group’s CEO Vittorio Colao said in a statement that the proposed merger between Vodafone India and Idea Cellular should not be looked upon as Vodafone’s exit from the market but a move against the competitive threat posed by Reliance Jio Infocomm.
  • A special CBI court has acquitted Dayanidhi Maran and Sun TV promoter Kalanithi Maran in a case involving bribery allegations.
  • TRAI said Reliance Jio’s second promotional offer. Happy New Year offer is not an extension of its previous welcome offer and has passed the same opinion to Telecom Disputes Settlement Appellate Tribunal (TDSAT). Airtel and Idea had alleged that it was an extension of free offer hence not allowable.

 

Friday- 3rd February 2017

  • BSE made a record-setting debut in the market at 32.8% premium over the issue price of ₹806 at ₹1085 and reached the day’s high of ₹1,200. It closed at ₹1,070.55
  • The Supreme Court has refused to let Aircel go off the hook regarding corruption allegations as T Ananda Krishnan failed to appear for the hearing. This further casts doubt on proposed merger of Reliance Communications with Aircel.
  •  Reliance Jio Infocomm and PayTm received notices from the Government over the use of  Prime Minister Narendra Modi’s photographs on their advertisements and they have been asked if they had obtained prior approval regarding the same.
  • Managing Director and CEO of IFDC, Vikram Limaye is set to become the new MD & CEO of the National Stock Exchange.
  • After a clean chit was issued to the company’s founder, Sun TV network soared 25% to ₹699, its 52-week high.

 

Source: The Economic Times
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Union Budget 2017- Key Takeaways.

The Union Budget 2017 was set to be a historic budget even before its presentation as

  • It was the first time that the Railway Budget was not separately presented but incorporated into the Union Budget only.
  • As a standard practice, the Budget has been introduced on the last day of the month of February every year (except for budget in the year of the elections). However, this time the budget was presented on the first day of the month of February.

The session started with paying respects to the late External Affairs Minister E Ahamed who passed away overnight. After some havoc, the Finance Minister Arun Jaitley presented the budget, highlights of which are as follows-

 

Agricultural and Rural areas

  • Agricultural Credit takeoff of ₹10 lakh crore in the budget.
  • A long-term irrigation fund at NABARD by investing ₹40,000 crores.
  • Dairy Processing Infra Fund of ₹8,000 crores in 3 years.
  • Fasal Bima Yojna to be increased from 30% to 40%
  • Assistance up to ₹75 lakh for cleaning and packing agricultural produce.
  • Highest ever allocation to MNREGA at ₹48,000 crores.
  • 100% electrification of rural areas by May 2018
  • ₹27,000 crore allocated for Pradhan Mantri Gram Sadak Yojna.

 

Health

  • For senior citizens, Aadhar based health cards to be issued.
  • 1.5 lakh health sub-centres to be converted to Health Wellness Centres.
  • AIIMS to be set up in Jharkhand and Gujrat.

 

Infrastructure

  • Affordable housing to be given infrastructure status, which will effectively allow cheaper funding for affordable housing.
  • Transport Sector to be allocated ₹2,41,000 crores.
  • Infrastructure allocation at ₹3,96,135 crores.
  • Allocation for National Highways at ₹64,000 crores.

 

Railways

  • The total amount allocated for railways will be ₹1,31,000 crores for next FY.
  • A safety fund to be created of ₹1,00,000 crores.
  • 25 Station re-development contracts to be awarded.
  • 500 stations to be made disabled-friendly.
  • A new Metro Rail policy to be announced for easy financing and implementation.
  • Service Charge on ticket booking on IRCTC withdrawn.

 

Financial

  • The Foreign Investment Promotion Board to be abolished and a new framework to be created.
  • Railways Companies such as IRCON and IRCTC to get listed.
  • Bank Recapitalisation to stay at ₹10,000 crores.
  • Two new schemes for promotion of BHIM app.
  • AADHAR pay to be launched shortly.
  • Strengthen the legislative framework to freeze assets of economic offenders who flee the country.
  • Target Fiscal deficit at 3.2% and revenue deficit at 2.1%.
  • Cash Transactions over ₹3,00,000 not to be allowed.

 

Direct Taxation

  • Holding period for Long Term Capital Gains tax on immovable property from three years to two years.
  • The base year for indexation for LTCG to be 2001 instead of 1981.
  • Carryforward of MAT credit for 15 years instead of 10 years.
  • Corporate Tax rates for MSMEs with revenue not more than ₹50 crores to be reduced to 25%
  • Slab rate for income between ₹2,50,000 and ₹5,00,000 to be reduced to 5%.
  • Surcharge of 10% for those having a total income of ₹50 lakh to ₹100 lakh. This is in addition to 12% surcharge on income above ₹1 crore.
  • Maximum cash donations to political parties from a single source which will be exempt from tax have been reduced from ₹20,000 to ₹2,000.
  • Presumptive Taxation at 6% for assessees having only cashless transactions.
  • Cash expenditure exceeding ₹10,000 shall be disallowed.
  • Single page ITR for assessees having income up to ₹5,00,000
  • TDS on commission to insurance agents at 5% abolished.
  • Foreign Portfolio Investors (Category I and II) exempt from indirect transfer provisions.
  • Domestic Transfer Pricing to be limited to cases where one of the entity enjoys specified profit linked deductions.
  • Threshold limit for Tax Audit raised to ₹2,00,00,000.
  • Threshold limit for maintenance of books of accounts raised to ₹25,00,000 turnover or ₹2,50,000 income.
  • For profit linked income-tax exemption for promoters of affordable housing, carpet area should be 30/60 sqm instead of built up area. The period for completion has been extended to 5years.

 

Indirect Taxation

No reform in the existing structures of Indirect Taxation as they are to be replaced by GST soon.

 

Miscellaneous

  • Swayam Platform for students having over 350 free courses.
  • Centralised Defense Travel System for defense personnel, where tickets can be booked without the hassles of queues.
  • Scheme for senior citizens to ensure 8% returns.
  • Allocation of ₹10,000 crores for providing high-speed internet under Bharat Net Project.

 

This list only covers items covered in the speech and not in the annexure.
The above points are only key highlights, not covering all aspects of the budget.

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BSE-Twitter ties,Jubilant Foodworks slumps, Union budget modifications- Weekly Digest #15

Monday- 19th September 2016

  • Bombay Stock Exchange has partnered with Twitter to provide live updates of Sensex levels, stock prices and opening and closing figures of Sensex companies. This will be Asia’s first such collaboration between a stock exchange and a social media platform.
  • Chinese real estate giant Dalian Wanda has announced a $10-billion investment in India and is seeking several concessions for the industrial park that it’s planning to develop in Haryana and its other investments.
  • French state-run power major EDF plans invest heavily in renewable energy in India, with projects worth $2 billion in the pipeline. It is bullish about the sector, where it sees electricity tariffs falling 30% in five years.
  • Venture capital firm Bessemer Venture Partners has led a new round of funding of INR 100 crores in the online food-delivery company Swiggy. The funding will be used by Swiggy to improve customer experience, expanding the current base of 9,000 restaurants and better delivery efficiency.

 

Tuesday-20th September 2016

  • Online furniture and home decor marketplace Pepperfry has raised INR 210 crore as part of a new round of funding from existing investors. The said funds to be utilised for expanding to 1,000 cities in the next two years.
  • Mobile phone manufacturers have approached the finance ministry seeking continuation of the differential duty structure and the benefits that come with it, which they fear would become a casualty when the goods and services tax comes into effect.
  • Shares of Jubilant FoodWorks slumped to their lowest level since February on Tuesday after its chief executive officer and whole-time director Ajay Kaul resigned. The stock lost 6% to end at INR 944.15 on the BSE after falling as much as 8% intraday.

 

Wednesday- 21st September 2016

  • The Cabinet on Wednesday cleared the long-pending compensation of  INR 1,250 crore for public sector telecom company BSNL to support rural landline connections installed before April 1, 2002.
  • The INR 6,000-crore IPO of ICICI Prudential Life Insurance closed on a strong note with the issue getting subscribed 10.4 times. The issue, priced between INR 300 -334, is the first by an insurer in India and the biggest since Coal India’s INR 15,000-crore issue in 2010.
  • India’s economic position with the external world improved substantially in the June quarter with the current account deficit falling to a decade low supported by a collapse in commodity prices, but falling short of expectations of a surplus.
  • The government has decided to carry out three kinds of changes in the Union Budget: to advance its presentation by 27 days, to do away with a separate railway budget and to dispense with Plan-non-Plan dichotomy in expenditure.
  • Volkswagen faces $9.1 billion in damages claims from investors over its emissions scandal in the legal district where the carmaker is based, a German court said.

 

Thursday- 22nd September 2016

  • The government has appointed three members to the monetary policy committee (MPC),  with the task of setting interest rates, ending the Reserve Bank of India governor’s role as sole arbiter. Its first policy review is scheduled for October 4.
  • HDFC Bank has raised an amount of INR 6,700 crores by selling infrastructure bonds to top fund houses such as Reliance MF, ICICI Prudential, Birla Sun Life MF & Kotak MF. They offer 7.95% interest with a 10-year maturity.
  • Tata Sky, a direct-to-home (DTH) player, has earmarked INR 35-40 crore to spend on marketing alone as it plans to press the accelerator with its new marketing blitzkrieg.

 

Friday- 23rd September 2016

  • India has signed a $ 7.87 billion deal with the  French government to purchase new Rafale fighter jets. The negotiations for the same had lasted for 18 months.
  • SEBI has asked credit rating agencies to come out with disclosures and fix accountabilities so that situation similar to the one that occurred last September with Amtek Auto is not repeated.
  • Among the rumours that Specified Undertaking of Unit Trust of India (SUUTI) may sell its stake in the Axis Bank, shares of the bank fell nearly 6%,  the most in 11 months.
  • L&T Technology Services made a neutral debut in the market, with the price of a share closing at INR 865.10, 0.6% higher than its issue price of INR 860

 

Source: The Economic Times

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