8 January 2024 : Important Financial News in India


Source: Economic Times, “Today’s ePaper”
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Table of Contents

GST Notices of ₹1.45Lcr Sent out in Dec for FY18

In December, authorities managing the Goods and Services Tax (GST) in India issued demand notices amounting to ₹1.45 lakh crore to approximately 1,500 businesses. This action was taken due to discrepancies found in their annual returns, specifically concerning the claims for input tax credit for the financial year 2018. This move by the GST authorities highlights the stringent measures being taken to ensure compliance and accuracy in tax filings and the utilization of tax credits. It underscores the government’s commitment to maintaining a robust tax system, ensuring that businesses adhere to the regulations and report their finances accurately.

Flipkart may Trim Rolls by up to 7% in Yearly Refocus

Walmart-owned Flipkart is reportedly undergoing a workforce reduction, potentially reducing its team size by 5-7%. This decision is part of the company’s annual performance reviews and strategic refocusing. Scheduled for completion by March-April, this move reflects the dynamic nature of the e-commerce industry and the need for companies like Flipkart to continually adapt and optimize their operations and workforce in response to changing market conditions and business priorities.

Green Channel Based on China Model to Speed up Ecomm Shipments Likely

India is planning to establish a ‘green channel’ for e-commerce exports, inspired by China’s model of cross-border e-commerce-integrated pilot zones. This initiative is expected to streamline customs procedures, thereby accelerating the movement of e-commerce shipments. Such a development would significantly benefit India’s e-commerce sector, offering a more efficient and faster process for handling exports, potentially boosting the country’s global trade.

Nifty Cos’ Dec Qtr Profit may Grow in Double Digits

India’s top 50 listed corporates, represented in the Nifty index, are anticipated to report a significant year-on-year growth in net profit for the December quarter. This marks the third consecutive three-month period of double-digit profit growth. However, a comparatively muted performance by technology and consumer-goods companies could slow down this growth rate. This trend reflects the overall health and resilience of India’s corporate sector amidst varying industry performances.

#BoycottMaldives Trends Post Diplomatic Storm

A diplomatic disagreement between India and Maldives has led to a widespread call for boycotting Maldives among Indians on social media platforms. Numerous individuals have claimed that they are canceling their planned trips to the island nation as a response to the recent diplomatic tensions. This movement underscores the impact of international relations on tourism and public sentiment.

‘We will Insulate Ourselves from Biz Cyclicality’

Suzlon Energy, an Indian multinational wind turbine manufacturer, has seen its shares surge by 277% in the last year, outperforming the Benchmark Sensex’s 19% gain. The company has successfully transitioned to a debt-free status and is now generating cash, indicating a robust financial recovery and strategic resilience against business cyclicality.

REC Launching Yen Bonds this Week to Raise ₹2.5k cr

Rural Electrification Corporation (REC), a leading state-sponsored infrastructure finance company in India, is set to launch an offering of Yen bonds to raise at least ₹2,500 crore. This initiative indicates REC’s strategic move to diversify its funding sources and capitalize on the global financial markets.

Serentica Renewables Raises ₹3.5k cr via ECBs

Serentica Renewables, part of the Vedanta Group, has raised ₹3,500 crore through external commercial borrowings (ECBs) for its round-the-clock renewable energy project in India. This significant capital infusion highlights the growing focus on renewable energy development in India and the role of commercial funding in facilitating such large-scale projects.

Consumer Cos Do Not Want to Leave Distributors On Margins

Major consumer goods companies in India, including prominent names like Hindustan Unilever and Nestle, are revamping their distribution strategies. This change aims to boost sales, particularly of slow-moving products, and strengthen their presence in rural markets, which have been under pressure for more than a year.

Passenger Vehicle Makers Miss Fuel Efficiency Targets

India has failed to meet its fuel efficiency targets for passenger vehicles in the last financial year, marking the first such occurrence since the initiative’s inception five years ago. This shortfall indicates challenges in the automotive sector’s pursuit of more environmentally sustainable and efficient vehicle production.

DoT May Not Include 600 MHz Band in Its Next Spectrum Sale

The Department of Telecommunications (DoT) in India has decided not to auction the 600 MHz spectrum band in the upcoming sale, opting instead for further studies to ensure no interference with satellite operations. This decision reflects the complexities involved in managing spectrum allocations and the need to balance technological advancements with operational integrity.

TaMo Rejigs Key Roles at PV Business

Tata Motors is undergoing a significant organizational restructuring of its passenger vehicle (PV) business. This strategic move is part of the company’s broader plan to elevate Tata Motors Passenger Vehicle (TMPV) and Tata Passenger Electric Mobility (TPEM) to new heights of growth. It demonstrates Tata Motors’ commitment to adapting and evolving in the rapidly changing automotive industry, especially in the electric vehicle segment.

EIH Considers Moving SC against HC Ruling on Wildflower Hall

EIH, a major player in the hospitality industry, is contemplating an appeal to the Supreme Court against a ruling by the Himachal Pradesh High Court. This ruling requires the Oberoi group’s flagship firm to vacate Shimla’s luxury hotel, Wildflower Hall, which has historical significance as the former residence of Lord Kitchener, a colonial-era British Army commander. This legal challenge highlights the complexities of property rights and historical legacies in the hospitality sector.

RIL-Brookfield to Open Data Centre Next Week

Reliance Industries Limited (RIL), led by Mukesh Ambani, in partnership with Canada’s Brookfield, is set to open a data centre in Chennai next week. This marks the company’s entry into the rapidly growing data centre market. This strategic expansion reflects RIL’s diversification into technology and digital infrastructure, catering to the increasing demand for data storage and processing.

FMCG Makers See Low Volume Growth in Q3

Leading Fast-Moving Consumer Goods (FMCG) makers are anticipating low- to mid-single-digit volume growth in the October-December quarter. While there is an expectation of an improvement in consumer demand on a sequential basis, the modest growth projection indicates a cautious consumer spending environment and the challenges faced by the FMCG sector in stimulating significant volume growth.

All Providers Need M2M, WPAN and WLAN Registration

The Department of Telecommunications in India has extended the requirement for machine-to-machine (M2M) and wireless personal area network/wireless local area network (WPAN/WLAN) registration to all entities engaged in such businesses. This regulatory change is indicative of the government’s approach to ensure better compliance and regulation in the rapidly growing and evolving field of wireless communication and IoT technologies.

RBI Seen Using Fund Injections to Lower Money Market Rates

The Reserve Bank of India (RBI) is actively working to reduce money market rates through regular short-term fund injections. This move comes after a period of high funding costs and operational challenges due to a liquidity deficit. The central bank’s decision to intervene reflects its ongoing commitment to stabilizing the financial market and addressing liquidity concerns.

Bank Borrowings Increase by 67% in 2023

In 2023, bank borrowings have significantly increased by 67% on average. This surge is attributed to a combination of factors: the Reserve Bank of India’s liquidity mop-up actions to control consumer prices, a heightened demand for credit, and slower deposit growth. This trend underscores the challenges banks face in managing liquidity and credit demand in a fluctuating economic environment.

Go First Lenders Can Check Out New Offers

The resolution professional (RP) overseeing the bankruptcy of Go First Airlines has extended the voting deadline for lenders. This extension is to give lenders time to consider new expressions of interest from SpiceJet and two other investors. The move came after some creditors requested more time to make a well-informed decision. This development is crucial in the resolution process of Go First Airlines and indicates ongoing interest from potential investors in the aviation sector.

JC Flowers ARC, Acre, Edelweiss Among Bidders for Yes Bank’s ₹4,200-cr NPA Pile

JC Flowers ARC, Ares-backed Acre ARC, and Edelweiss ARC are among the eight investors bidding for a ₹4,200 crore non-performing asset (NPA) portfolio from Yes Bank. This portfolio includes both corporate and retail segments. The participation of multiple asset reconstruction companies (ARCs) in the bidding process shows the active market for distressed assets in the banking sector.

IndoStar Cap Sells ₹292-cr Stressed Book Under Senior-Junior Structure

IndoStar Capital Finance, backed by Brookfield and Everstone, has sold a ₹292 crore stressed asset portfolio to Encore Asset Reconstruction Company (ARC). The sale was structured with a senior-junior arrangement between the buyer and seller, indicating innovative approaches in the management and transfer of stressed assets.

FPIs’ Equity Buys Touch ₹4,800 cr in Jan First Week

Foreign portfolio investors (FPIs) have invested approximately ₹4,800 crore in Indian equity markets in the first week of January. This continued investment trend is driven by confidence in India’s strong economic fundamentals, showcasing the country’s attractiveness to international investors.

Wait Until Jyoti CNC Lists to Evaluate its Cutting Edge

Jyoti CNC Automation, a company specializing in the manufacturing of CNC machines for complex parts, is planning an initial public offering (IPO) to raise ₹1,000 crore. This upcoming listing offers an opportunity for investors to evaluate the company’s market potential and technological edge in the manufacturing industry.

Mega Plan for Building Highways Soon

India is set to launch a new ambitious highways construction program, envisioned as part of the Narendra Modi-led NDA government’s Vision 2047. This initiative, aimed at replacing the existing Bharatmala Pariyojana, is focused on enhancing connectivity across the country. The introduction of this program marks a significant step in India’s infrastructure development, aligning with long-term strategic goals.

Going Bananas: Prices Rise to ₹30/kg from ₹18-20 in Oct

Banana prices in India have surged dramatically, rising from ₹18-20 per kg in October to ₹30 per kg. This price hike is attributed to reduced cultivation and the spread of disease in major banana-producing areas. The inflation rate for bananas jumped to 16.5% in November from just 2.2% four months earlier, reflecting the impact of these challenges on the fruit’s market price.

Centre may Rake in ₹55,000 cr in Dividends from Key CPSEs

The Indian government is projected to collect around ₹55,000 crore in dividends from non-financial central public sector enterprises (CPSEs) and other investments in this financial year. This figure exceeds the budgetary target of ₹43,000 crore by over a quarter, indicating a robust performance by these enterprises and a significant contribution to the government’s revenue.

India-Oman FTA: Duty Rebate on Petrochemical Items a Sticking Point

In the ongoing negotiations for a free-trade agreement (FTA) between India and Oman, the demand for customs duty concessions on petrochemical products like polypropylene and polyethylene is emerging as a major point of contention. These products, largely used in the plastics industry, are pivotal in trade discussions, impacting the pace and outcome of the FTA talks.

‘Linking E-invoice with E-way may Hamper Ops’

The impending rule to mandatorily link e-invoices with e-way bills, starting March 1 for certain transactions, is raising concerns among businesses and tax experts. This requirement is expected to cause operational disruptions and has created confusion, with many seeking clarifications from authorities. The implementation of this linkage is part of India’s broader digitalization efforts in taxation but poses challenges for smooth operational transition.

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