Thursday 18 April 2019

CORPORATE UPDATES 18.04.2019




PRE-PACKAGED INSOLVENCY RESOLUTION: GOVT SEEKS STAKEHOLDER COMMENTS

The ministry of corporate affairs (MCA) on Tuesday invited comments from stakeholders on pre-packaged insolvency resolution and insolvency resolution for group companies among other issues related to the Insolvency and Bankruptcy Code, 2016, and the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Participants can submit their comments till May 7. The government has invited comments from corporate debtors, creditor to a corporate debtor, insolvency professional, industry associations, law firms, investors, etc. MCA has been mulling introducing pre-packaged insolvency, which is similar to the practice prevalent in the US and the UK, where creditors and shareholders can approach bankruptcy courts with a prenegotiated corporate reorganisation plan. Pre-packaged insolvency resolution scheme allows creditors and shareholders to approach bankruptcy courts with a pre-negotiated corporate reorganisation plan. Such a step will aid the existing insolvency framework in India and cut costs as well as the time of resolution process.
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PARTNERS ACCUSE PRAJAY PROMOTERS OF MISMANAGEMENT; MOVE NCLT

Foreign and local partners of Prajay Engineers Syndicate have moved the National Company Law Tribunal (NCLT), accusing the promoters of the real estate and property development firm of mismanagement and malaise thereby eroding its substratum and raising the risk of winding up. Global partners Belclare and Whitestock, and a group of domestic shareholders led by Hymavathi Reddy, widow of its former chief promoter DS Chandra Mohan Reddy, filed separate petitions in the NCLT. They urged the tribunal to order a forensic audit of Prajay Engineers and restrain its management led by chairman and managing director D Vijay Sen Reddy from alienating any assets. They also sought annulment of contracts entered into by the promoters against the provisions of foreign investment agreements. Belclare, a Cyprus-based firm owned by Oman’s State General Reserve Fund, had invested Rs 70 crore in a stepdown property development subsidiaries of Prajay Engineers in May 2010. It has now accused Vijay Sen Reddy and others in the management of violating agreements on governance and corporate compliance. Belclare said it was excluded from the affairs of the entities where it had invested in and that it had not received any financial statements or information on the progress of the projects undertaken by the entities ever since it had made the investments. According to the Cyprus firm, it learnt that its investments into Prajay Properties were diverted to parent Prajay Engineers through inter-corporate deposits and then siphoned off. Belclare told the tribunal that it had appointed PricewaterhouseCoopers to conduct a forensic audit of the books of the Prajay Engineers entities, but the auditing firm wasn’t allowed to carry out it despite repeated requests. Belclare alleged that the promoters led by Vijay Sen Reddy had resorted to making material decisions, including altering the composition of the board by way of fictitious board meetings. The investor said Vijay Sen Reddy had repeatedly requested it to retrospectively sign the fictitious minutes of such board meetings. There was also a request from respondent No 4 (Vijay Sen Reddy) to backdate minutes of a meeting that in fact did not take place, it claimed.
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JAYPEE HOMEBUYERS CAN SUE JAIPRAKASH ASSOCIATES AFTER SC ORDER

The Supreme Court has declined to stay the apex consumer commission's order, which held that home buyers in Jaypee Infratech Ltd (JIL) can move the consumer forum against JIL's parent company, Jaiprakash Associates Ltd. (JAL), for compensation and possession of their respective flats. JIL is undergoing insolvency proceedings. The Life Insurance Corporation declared JIL as a non-performing account (NPA) on September 30, 2015, and other lenders declared it as an NPA on March 31, 2016. A bench comprising Justices A.M. Khanwilkar and Ajay Rastogi said: All contentions available to the respondent (home buyers) in the complaint, including on the relief of possession and refund against JAL, will have to be adjudicated by the Commission on its own merits in accordance with law uninfluenced by the observations made in the impugned judgment. JAL had moved the apex court challenging the National Consumer Disputes Redressal Commission (NCDRC) order. Many home buyers had moved the NCDRC about compensation or a refund with compensation from JIL and JAL. The NCLT appointed an Interim Resolution Professional (IRP), while declaring a moratorium under the Insolvency and Bankruptcy Code. The top court observed that the consumer commission will examine all contentions available to both sides (home buyers and JAL) regarding the rights and obligations of the parties on the merits in accordance with law. The apex consumer commission in its order noted that the home buyers cannot approach the consumer forums against JIL, at this stage, as it is under insolvency proceedings. The court said : The Commission, however, may give appropriate directions in the final judgement which obviously will be subject to the outcome of the proceedings before the NCLT insofar as JIL is concerned and also subject to the outcome of proceedings against JAL before the NCLT. Sanjeev Sahani, said: No home buyer will pay installment until a flat is ready for possession. Each project should be monitored by the home buyers' association. The company should come out with a project-wise, tower-wise completion dates.
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BANS WANT 90% LENDERS’ NOD FOR RESOLUTION

Banks have urged the Reserve Bank of India (RBI) to make only a small relaxation in the new norms for stressed assets by requiring consent of 90% of lenders for approving a resolution plan instead of 100% mandated in the last year’s controversial circular, which was quashed by the Supreme Court recently. The recommendation of the Indian Banks’ Association (IBA) to RBI about the lenders’ consent clause has dismayed industry. Companies were hoping for a much bigger relaxation in rules and many executives fear that the year-long legal battle that culminated in the Supreme Court’s order this month would fall flat if IBA’s view prevails. IBA chief executive VG Kannan told that 90% limit is the safest bet as the chances of the dissenting lenders moving the project to insolvency court will reduce. The probability of proper resolution is better at 90% limit than at 66%, he said. IBA’s demand of 90% lenders’ consent is against the requirement of 66% approval specified in the Insolvency and Bankruptcy Code and the Inter Creditors' Agreement signed by most big banks last year as a way out against the February 12, 2018 RBI circular. Many companies are disappointed by the IBA recommendations. The 90% limit is no better than the 100% consent. The chances of a resolution process being agreed upon by all the lenders or 90% of lenders are very low, as we have already seen in most resolution processes over the past one year, said an industry executive requesting anonymity. The 100% lenders’ approval clause was considered the most stringent requirement in the quashed circular as lenders were not able to get all lenders on board for a resolution scheme. Resolution plans of most projects have been stuck for want of 100% consent from lenders. A senior official with a public sector bank, however, said that no major deals were made even prior to the RBI circular when 75% consent was required. We can at least pursue or buy the 10% dissenting lenders. The 90% limit will also attract investors as they are comfortable with the resolution process being agreed by a large number of banks, he said adding that IBA members held long discussions on proposals to RBI. In their letter to RBI, power companies have sought different treatment in the ensuing circular to help the sector to revive in 18-24 months. APP has also asked that after restructuring of an account, it should be upgraded if the company makes regular payments for one year and 5% of the outstanding debt is paid.
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SUPREME COURT STAYS HC ORDER ALLOWING HANDING OVER OF LA-FIN MGMT TO JIGNESH SHAH

The Supreme Court has stayed the Bombay High Court order that allowed handing over of the management of embattled investment firm La-Fin Financial Services back to its erstwhile management led by the former MCX promoter Jignesh Shah group. Financial creditor IL&FS Financial Services had moved the apex court against the HC orders of March 4 and April 9 that stalled the insolvency proceedings initiated against La-Fin by National Company Law Tribunal, Mumbai, on August 28, last year. IL&FS had moved the insolvency plea in May 2017, in respect of a debt of `97.79 crore and default of payment of a financial debt of `266.39 crore. A bench led by Justice RF Nariman stayed a part of the HC judgment that gave back charge of the corporate debtor to its suspended board of directors. It also asked IL&FS to serve copy of the appeal to the government. Besides, it also sought a copy of the winding up suit filed by IL&FS against La-Fin for examining it. The National Company Law Appellate Tribunal had in January dismissed the petitions filed by Jignesh, his mother Pushpa Shah and others challenging the NCLT order that allowed insolvency proceedings against La-Fin. The appellate tribunal said that IL&FS is the ‘Financial Creditor’ and there is a debt and default, thus the insolvency plea had been rightly admitted. It had rejected Shah group’s stand that there was no financial debt and there was no relationship of debtor and creditors between La-Fin and IL&FS. Soon after the NCLAT order, Shah, instead of moving the apex court, filed a writ petition before the HC against the appellate tribunal’s January order. The HC should not have entertained the petition as it undermines the statutory framework and encourage forum shopping by unscrupulous litigants, IL&FS said in its appeal filed through counsel Liz Mathew before the SC. According to the financial creditor, the HC had given in to a delay tactic to thwart and delay the CIRP of the debt-laden firm which is at an advanced stage of completion. NK Kaul argued that IL&FS suit was filed well in time in June 2013 and the winding up plea was within a limitation period. The management of the company can’t go back to Shahs. The RP has been there since 2018, he said. The issue dates back to August 20, 2009, when IL&FS Financial Services purchased 5% equity shares (4.42 crore) of Multi Commodity Exchange of India (MCX) at 36 per share for total consideration of 159.12 crore.
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BALLARPUR GROUP FIRM TO FACE NCLT OVER BANK DEFAULT ALLEGATIONS

Private lender Kotak Mahindra Bank has taken Ballarpur Industries arm BILT Graphic Paper Products to the National Company Law Tribunal (NCLT) for default of Rs 218 crore An NCLT tribunal of VP Singh and Ravikumar Duraisamy adjourned the matter to May 8 when they will decide on the admissibility of the bankruptcy petition. The respondent (BILT Graphic) can file its response during that time, the court added. BILT Graphics owes over Rs 6,000 crore to lenders. The company was on the second list of 29 defaulting companies of RBI, recommending that these firms be referred for resolution through the bankruptcy code. In February 2018, IDBI Bank took the company to NCLT after an RBI direction to do so as the regulator rejected its debt recast package as only 70 per cent of the lenders had signed it. However, in March 2018, the company challenged the RBI directive in Delhi High Court, which ordered the lender to maintain status quo at NCLT. Later, the company moved the Supreme Court, where the matter is still pending.
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FUNDING TECH INCUBATORS CAN QUALIFY AS CSR SPEND

India Inc looking to lend a helping hand to the startup ecosystem will soon be able to use its corporate social responsibility corpus for the same. The government panel on corporate social responsibility (CSR) is likely to suggest tweaks to the CSR framework to allow funding to all incubators to be counted towards CSR spend, a government official privy to the deliberations said. As per the current provisions, contributions or funds provided to technology incubators located within academic institutions and approved by government qualify as CSR. The Department for Promotion of Industry and Internal Trade (DPIIT) had sought widening of this definition to include other incubators as well, and it is likely to be part of the changes being considered for the CSR framework, the official said. Only about Rs 54 crore was spent on technology incubators under CSR during 2014-17, which is meagre compared to spend on education, at Rs 10,651 crore, and healthcare, at Rs 6,671 crore. The panel is also expected to look at other changes based on stakeholder feedback. and experience. The report is expected soon and could be taken up for implementation post elections. The government had set up a high-level committee headed by corporate affairs secretary Injeti Srinivas in September, 2018 to review the existing CSR framework and make a road map for a coherent policy. The panel includes Tata Sons chairman N Chandrasekaran, sportsman Prakash Padukone and HelpAge India CEO Mathew Cherian. It was tasked with not just looking at CSR laws, but also at rules and circulars issued from time to time and analyse outcomes of CSR activities, programmes and projects, and suggest measures for effective monitoring and evaluation of CSR by companies. It could also propose steps for use of technology and social audits. The provisions of Section 135 of Companies Act, 2013 pertaining to CSR came into force on April 1, 2014. This section requires every company above the specified thresholds of turnover, or net worth, or net profit to spend at least 2% of its average net profits earned during the three immediately preceding financial years on specified CSR activities. According to government records, the total CSR spend has risen from Rs 10,066 crore in FY15 to Rs 13,464 crore in FY17.
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NBCC TO SUBMIT REVISED BID TO ACQUIRE JAYPEE INFRATECH BY APRIL 25

State-owned NBCC Ltd is likely to submit revised bid by April 25 for acquiring debt-ridden Jaypee Infratech and complete the housing projects. Lenders of Jaypee Infratech met on Tuesday and asked NBCC to submit their plan by April 25 as requested by the public sector firm, sources said. NBCC and Suraksha Group are in race to acquire bankruptcy -bound realty firm Jaypee Infratech. Separately, Jaypee group promoters have submitted over 10,000 crore offer to settle lenders debt and complete projects but the same is not being considered. NBCC had even suggested that it was ready to work as project management consultant and charge fees for completing the stalled projects.
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LIBERTY HOUSE NOT LOSING HOPE FOR ADHUNIK METALIKS

In spite of failing to pay up 410 crore obligation within the deadline for the takeover of the debt-ridden Adhunik Metaliks, the Liberty House is hopeful of striking the deal, even as the issue will be heard in the Cuttak bench of the National Company Law Tribunal on April 30. The Liberty House Group has sought fresh extension of time citing pending regulatory and statutory approvals but creditors apparently remained reluctant. The deadline for the payment was April 14. We are working on procuring statutory and regulatory approvals which are a vital part of the implementation plan, a Liberty House statement said. Sources in committee of creditors (CoC) have indicated that they are not keen to extend the deadline any further and a fresh round of bidding could be a possibility, if things do not work out amicably in the interim period. The options before the CoC is to invite a fresh bid or allow time hoping to get funds The CoC may think for a fresh bidding if interest for the asset could improve compared to the 410 crore offer where haircut had been 92 per cent against outstanding dues of 5,370 crore in this round of resolution plan. But, this would be a time consuming affair. However, it needs to be seen if NCLT entertains LHG plea to extend timeline for the payment or not.
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JET PILOTS MAY APPROACH NCLT FOR RECOVERY OF DUES

Faced with no other options, Jet Airways’ pilots are considering filing a plea with the National Company Law Tribunal (NCLT) to recover salary. The pilots have not been paid since January. If the interim funding comes in, the salary may come in by tonight or tomorrow morning. We need more than Rs. 1,000 core. The aviation industry has perishable assets and the airline needs to be saved. If the funding does not include salaries, then the operations might get suspended. Then we will consider the option to approach the NCLT, said a representative of the National Aviator's Guild (NAG), the Pilot body of Jet Airways.
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ELIGIBLE NBFCS CAN GET LICENCE TO OFFER FOREX TRANSACTIONS TO INDIVIDUALS: RBI

The Reserve Bank of India (RBI) Tuesday said systematically important non-deposit taking NBFCs offering foreign exchange transactions on individual accounts will be eligible to obtain Authorised Dealer (AD) Category-II licence from it. AD-Cat II means entities that are authorised by the RBI to deal in foreign exchange for specified purposes. These include upgraded full-fledged money changers (FFMCs), select regional rural banks, select urban cooperative banks and certain other entities. The RBI noted that a large segment of population is increasingly getting connected with forex transactions on individual accounts. To increase the accessibility and improve the efficiency of services extended to the public for their day-to-day non-trade current account transactions, the RBI said it has been decided that systemically important non-deposit taking investment and credit companies shall be eligible for Authorized Dealer- Category II (AD-Cat II) licence. The central bank further said NBFCs having a minimum investment grade rating are eligible for the licence It also said NBFCs offering forex services should have a board-approved policy on managing the risks (including currency risk) and handling customer grievances arising out of such activities. A monitoring mechanism, at least at monthly intervals, shall be put in place for such services, it added. The eligible NBFCs desirous of undertaking AD-Cat II activities should approach the RBI for the licence.
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RERA DOES NOT BAR HOMEBUYERS' COMPLAINT UNDER CONSUMER PROTECTION ACT AGAINST BUILDER/DEVELOPER: NCDRC

The National Consumer Disputes Redressal Commission (NCDRC) has held that Real Estate (Regulation and Development) Act 2016 (RERA) does not bar filing of a complaint under the Consumer Protection Act 1986 against a builder/developer. The bench headed by Justice R K Agrawal was dealing with a batch of complaints filed by homebuyers for compensation from Today Homes & Infrastructure Pvt Ltd for not delivering possession of flats within the stipulated time. The builder/developer raised preliminary objections against the maintainability of complaints on two grounds :

·       After the commencement of RERA, consumer complaint was not maintainable, as Section 79 of RERA bars jurisdiction of civil courts.
·       The arbitration clause in the agreements with buyers excluded jurisdiction of consumer forum.

Rejecting these objections, the Commission held that Consumer Protection Act was a special enactment which provided a special remedy to an aggrieved consumer. The authorities under Consumer Protection Act cannot be regarded as civil courts and hence Section 79 of RERA did not apply.

It was held
Section 79 of RERA only prohibits the jurisdiction of Civil Court from entertaining any suit or proceeding in respect of any matter which can be decided by the Authorities constituted under the RERA. As the Consumer Fora are not Civil Courts, the provisions of Section 79 which bar the jurisdiction of Civil Courts, will not be attracted. So far as to grant injunction is concerned, only that power has been taken away by Section 79. But, it does not, in any manner, effect the jurisdiction of the Consumer Fora in deciding the Complaints. Both, the Consumer Protection Act, 1986 and the Real Estate (Regulation and Development) Act, 2016 are supplemental to each other and there is no provision in the Consumer Protection Act which is inconsistent with the provisions of RERA. The summary of conclusions of the NCDRC are as follows : The Consumer Protection Act, 1986 is a supplement Act and not in derogation of any other Act; The Consumer Fora constituted under the Consumer Protection Act, 1986 are not Civil Courts. A Consumer cannot pursue two remedies for the same cause of action. However, if a Consumer has not approached for redressel of its grievance under the particular Statute, the Consumer can approach the Consumer Fora under the Consumer Protection Act. But, if the Consumer had already approached the Authority under the relevant Statute, he cannot simultaneously file any complaint under the Consumer Protection Act. Mere availability of a right to redress the grievance in a particular Statute will not debar the Complainant/Consumer from approaching the Consumer Fora under the Act Even though under Sections 14, 15, 18 and 19 of RERA, various provisions have been made which are to be followed by the Developer/Promoters and the rights and duties and the return of amount as compensation as also rights and duties of Allottees, yet same cannot mean to limit the right of the Allottee only to approach the Authorities constituted under the RERA, he can still approach the Consumer Fora under the Consumer Protection Act. Section 71 of RERA which gives the power to adjudicate, does not expressly or impliedly bar any person from invoking the provisions of the Consumer Protection Act. It has also given a liberty to the person whose Complaint is pending before the Consumer Fora to withdraw it and file before the RERA Authorities. Arbitration agreement does not bar consumer complaint. Referring to the recent SC decision in Emaar MGF Land Ltd. vs. Aftab Singh, the Commission held that the fact that Arbitration can be proceeded under the Arbitration and Conciliation Act, 1986 is not a ground to restrain the Consumer Fora from proceeding with the Complaints.
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SEBI BARS BENGALURU-BASED SIYARAM DEVELOPMENT & CONSTRUCTION, EIGHT DIRECTORS FROM MARKET

Sebi has barred Bengaluru-based Siyaram Development and Construction and its eight directors for at least four years from the securities market for illegally raising funds. Besides, the regulator directed the entities to refund the money collected by the company along with 15 per cent interest. Based on a complaint by an investor regarding non-payment of maturity amount of his investment, Sebi conducted a probe to ascertain whether the firm had made any public issue without complying with the relevant provisions of Sebi and the Companies Act. During the probe, the regulator found that the firm had allotted secured redeemable debentures (SRDs) between financial years 2010-11 and 2012-13 and raised at least Rs 4.22 crore from more than 49 allottees. Moreover, the firm created a charge for an amount of Rs 70 crore and appointed Kalpana Guha as its debenture trustee. As the number of allottees was more than 49, it was deemed to be a public issue and required a compulsory listing on a recognised stock exchange.
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ISSUANCE OF GOVT BONDS JUMPS TO RS 64K CR FROM RS 15K CR IN FY19: REPORT

The issuances of government-fully serviced bonds (GoI-FSBs) rose to Rs 64,192 crore in the year-ended March 2019 as compared to Rs 15,095 crore during the last fiscal, says a report. These borrowings are estimated to have accounted for 0.34 percent of GDP for FY19 as compared to 0.09 percent of GDP for FY18. The total outstanding value of these GoI-FSBs stood at Rs 88,454 crore at the end of FY19, according to Icra.
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MINDTREE'S RS 530-CR DIVIDEND PAYOUT TO MAKE ITS TAKEOVER COSTLIER FOR L&T

Amid L&T takeover bid, Mindtree on Wednesday announced interim, final and special dividends for its shareholders, totalling Rs 27 per share This move may push up the acquisition cost for the engineering major. This will result in an outgo of around Rs 530 crore, including dividend distribution tax (DDT), from the company’s kitty. The cash reserves stand at around Rs 1,100 crore by end of March 2019. The dividends have been declared to commemorate completion of 20 years of the company’s operations apart from crossing the $1 billion revenue milestone in the last financial year, the IT services company said. According to the company, while the interim dividend of Rs 3 per share will be payable to its shareholders with a record date of April 27, final and special dividend of Rs 4 and Rs 20 will be given after receiving shareholders’ approval in its next annual general meeting (AGM). While the company argued that declaration of these dividends has been done in normal course of action, corporate governance experts said a status quo would have been more desirable. It doesn’t take anything whatsoever from our governance processes. This special dividend is to commemorate Mindtree’s achievement, which is subject to approval of shareholders in the forthcoming AGM. It continuously upholds the standards of governance that Mindtree has, said Rostow Ravanan. The move, Ravanan said, was not intended to hurt or benefit any shareholder. When the AGM is held in July, all the shareholders will get a chance to cast their votes. It is in line with our capital allocation policy, he added.
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FOUL PLAY BEHIND SKIPPING RELIGARE OFFER: SUNIL GODHWANI

Sunil Godhwani, former CMD of Religare Enterprises (REL) has alleged that Siddharth Mehta of Bay Capital was in connivance with erstwhile promoters – siblings Malvinder Mohan Singh and Shivinder Mohan Singh — and Shyam Maheshwari of SSG Capital to acquire substantial stake in the company without giving a mandatory open offer as stipulated by market regulator Sebi. Bay Capital and its associate companies are significant minority shareholders of REL. Mehta was appointed non-executive non-independent director of Religare Enterprises in February 2018. In a letter to the ministry of corporate affairs dated April 6, Godhwani alleged that Bay Capital, India Horizon Fund, IDBI Trustee Company, Resilient India Growth Fund (SSG group company), SSG Capital and others acquired more than 26% shareholding in REL in connivance, without an open offer Religare Enterprises and its subsidiary Religare Finvest (RFL) had filed a complaint against the Singh brothers and Godhwani under the Companies Act with the ministry of corporate affairs in December 2018. It said RFL had sanctioned loans to companies known to the brothers but was never repaid. Loans stand at Rs 2,397 crore, with Rs 415 crore as interest to 19 entities. It is apparent that the price was deliberately battered down to Rs 52.50 per share from a high of Rs 250 per share. And the said price was reached upon taking into account the aspect of corporate loan book (CLB) which stood at about Rs 2,300 crore) and the same was written off, as this was the money which was taken by the erstwhile promoters, Godhwani alleged in his correspondence, copies of which was also sent to RBI and Sebi. The market cap of REL at Rs 52.50 per share was Rs 800 crore when the embedded value was over Rs 3,000 crore. Why and under what circumstances an open offer was prevented? This requires investigation by Sebi for insider trading and it will expose the entire nexus. The underlying value of asset is much more than the value of holding company, which explains the modus operandi between Siddharth Mehta and the erstwhile promoters, Godhwani further writes. Godhwani further alleged that Mehta through India Horizon fund had bought 52.2 lakh shares of Religare Enterprises in 2013 at about Rs 352 per share. In September 2017, SSG Capital of Shyam Maheshwari invoked pledged over 17% equity shares of REL which were held by IDBI Trustee (custodian of SSG Capital), he added.
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M&A ACTIVITIES SLUGGISH IN JAN-MAR; 33 PC DECLINE IN DEAL VALUE TO USD 12.5 BN: REPORT

The first quarter of 2019 recorded 110 merger and acquisition deals worth USD 12.5 billion (about Rs 86,500 crore), a 33 per cent fall in value terms as against the year-ago period, due to factors such as global economic conditions and uncertainty around Brexit, according to a report. As per Grant Thornton's quarterly deal tracker report released Wednesday, This drop (in value) can be attributed to delays in execution of deals, growing complexity in deal structures and macro-economic factors like upcoming elections, global economic conditions, and uncertainty around Brexit dampening investor sentiment. However, the quarter recorded a marginal increase in deal activity as compared to the fourth quarter of 2018, owing to encouraging factors such as proceedings under the Insolvency and Bankruptcy Code, divestments of non-core assets that have no synergies with larger group firms, drive in stressed asset space and cleaning up of bad loans. The deal volume witnessed seven per cent decline as compared to first quarter of 2018 when it stood at 118, the report added. This quarter witnessed an encouraging trend with 2 per cent increase in deal value and 7 per cent increase in volume as compared to the fourth quarter of 2018, demonstrating a positive and promising deal sentiment. Although we entered 2019 with substantially less momentum with 110 M&A deals worth USD 12.5 billion compared to 118 deals worth USD 18.7 billion in Q1 2018, some big deals announced this year have provided some encouragement that the outlook for M&A will be healthy despite a drop, said Pankaj Chopda. The announced deals include Arcelor Mittal's acquisition of Essar Steel for USD 7.2 billion, Radiant Life care's merger with Max healthcare for USD 1 billion, he said. Deal value increased exponentially in March 2019 with over 5 times as compared to March 2018. The month recorded the highest value in the past seven months on the back of eight high-value transactions despite a 6 per cent fall in volume. Two deals of USD 2 billion each were recorded in manufacturing and pharmaceutical sectors in the first quarter of 2019 and 15 deals valued and estimated at and over USD 100 million each together contributed 93 per cent to the total M&A deal value and 15 per cent to the M&A volume, thus demonstrating an appetite for big-ticket deals and an uptick in deal activity amid other uncertainties.
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INDIA INC FOREX BORROWING TO PICK UP PACE IN FY20: IND-RA

If foreign portfolio investment inflows continue and hedging costs remain subdued by way of the Reserve Bank of India’s actions or otherwise, foreign currency borrowings could pick up considerable pace during FY20, easing the demand-supply gap in the domestic credit markets, according to India Ratings and Research (Ind-Ra). The recent softening of the Indian rupee-US dollar (INR-USD) forward rate, if sustained at least in the foreseeable future, is likely to provide a fillip to Indian borrowers who plan to raise foreign currency-denominated capital, the credit rating agency said. A change in the global monetary policy conditions, along with the first round of the three-year swap auction, has already moderated the three-year cross-currency swap rate by 30 basis points (bps) on April 15, 2019, from the January 2, 2019, level. Meanwhile, during this period, the INR-USD forward premium moderated by 71bps, driven by a marked improvement in the domestic market’s dollar liquidity conditions, the agency elaborated. One basis point equals one-hundredth of a percentage point. Ind-Ra said that considering the moderation in the London Inter-Bank Offered Rate (LIBOR) and the softening hedging costs while domestic interest rate transmission remains muted, cost savings on foreign currency borrowings are likely to materially improve over the near to medium term. The spread between the SBI marginal cost of funds-based lending rate (MCLR) and the all-in LIBOR-linked cost (after accounting for hedging cost) increased to 2.48 per cent on March 29, 2019, from 1.28 per cent on September 28, 2018. The agency assessed that the interest outgo of the top-500 debt-heavy corporate borrowers could cumulatively reduce by 4,000-7,000 crore, assuming a 0.50-0.75 per cent reduction in the cost of forex borrowings, and a 50bps-200bps rise in the share of forex borrowings in the outstanding debt of these corporates.
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TIME FOR RBI TO CHANGE APPROACH; COMMUNICATION CAN BE USED AS POLICY IN ITSELF

Shaktikanta Das has sparked a debate on moving away from the conventional method of changing monetary policy interest rate in multiples of 25 bps. Instead, the size of the rate change could be calibrated in small or larger magnitudes to indicate policy stance, he suggested. This thinking indicates the RBI intent to use communication as the policy in itself rather than the policy statement just being a vehicle for communication, SBI said in its Ecowrap report this week. Shaktikanta Das said this against the background of several limitations imposed by the conventional and unconventional monetary policy tools in the aftermath of the global financial crisis. Monetary policy must touch the real economy, spur investments and maintain fiscal and monetary stability, he said. However, some economies have turned to the heterodox evolution of ideas that are being practiced as modern monetary theory, he noted. Although the intent of the RBI Governor looks positive, there remains concerns on the efficiency of an indicative rate cut of 10 or 15 basis points given the weak monetary transmission in the economy where even 25 or 50 basis points cut do not work, said SBI report. Moreover, rate changes of odd magnitude could be difficult to connect with markets unless properly decoded, the report added. The report suggested the RBI to provide second generation signals in its policy statement in order to reduce the disconnect with market expectations. This includes phrases indicating that policy accommodation can be maintained for a considerable period or can be removed at a pace that is likely to be measured.
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WILL FORMER DENA, VIJAYA BANK HEADS EXPLORE ANOTHER MERGER IN PSB SPACE?

Having successfully piloted the merger of Vijaya Bank and Dena Bank with Bank of Baroda, will the erstwhile chiefs of the merged banks moved recently by the government to helm Canara Bank and as a Whole-Time Director in Indian Overseas Bank, respectively, take a stab at another merger in the public sector banking space? Banking industry experts feel this is within the realm of possibility as both top bankers are unlikely to face any difficulty in replicating their learning from putting through a complex merger. Putting two and two together, the experts say that RA Sankara Narayanan, and Karnam Sekar, may be asked to explore another merger involving their respective banks and one more state-owned bank (possibly Oriental Bank of Commerce) by the government that takes power after the ongoing general elections. They reasoned that Sankara Narayanan and Sekar, both veteran bankers with collective experience of close to seven decades in commercial banking, have gained a wealth of knowledge and experience with the amalgamation of their erstwhile banks with BoB, and now are well-positioned to set the ball rolling on another merger in the state-owned banking space. Sankara Narayanan was appointed MD and CEO of Canara Bank with effect from April 1, 2019, till his superannuation on January 31, 2020. Sekar has been appointed as Officer on Special Duty and Whole-Time Director in Indian Overseas Bank, with effect from April 1 till the time of his taking charge as MD and CEO on July 1, 2019. He will superannuate on June 30, 2020. Merger in the public sector banking space is expected to gather steam as the main national parties – the BJP and Congress – are on the same page regarding consolidation among public sector banks (PSBs). During its five-year tenure, the BJP-led NDA government kickstarted the amalgamation process in the public sector banking space, with the five associate banks within the State Bank Group, and the Bharatiya Mahila Bank getting merged with State Bank of India in 2017, and Vijaya Bank and Dena Bank merging with BoB with effect from April 1, 2019. The Congress party, in its 2019 Lok Sabha election manifesto, said it will amalgamate two or more PSBs, so that there will be only six to eight PSBs with a national presence.
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INDIVIDUAL SETTLES CASE WITH SEBI IN CRISIL MATTER, PAYS RS 26 LAKH

Markets regulator Sebi has settled a case of alleged insider trading by an individual after paying over Rs 26 lakh towards settlement charges in the matter of Crisil Ltd. Besides, individual Priyanka Pathak disgorged illegal gains worth Rs 7.92 lakh along with an interest of Rs 5.15 lakh, Sebi said. In an order, the regulator said it conducted probe regarding the corporate announcement of voluntary open offer for acquisition of up to 1.56 crore equity shares of Crisil Ltd from public shareholders by McGraw-Hill Asian Holdings (Singapore) along with its persons acting in concert (PACs) on June 3, 2013. The probe observed that Pathak had purchased the shares of Crisil during the period when price-sensitive information was not public (May 1, 2013 to June 2, 2013) and sold the same immediately on the date of corporate announcement. By doing so, Pathak made profit of 7.84 lakh and thereby prima-facie violated insider trading norms, Sebi said. Pathak filed an application under settlement mechanism and proposed to pay Rs 26.28 lakh towards settlement charges along with disgorgement of illegal gains with 12 per cent annual interest. Accordingly, Pathak remitted Rs 26.55 lakh along with illegal gains of 7.92 lakh and an interest of Rs 5.15 lakh and thereby proceedings initiated against Pathak are settled, the regulator said in the order on Monday.
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INVESTMENTS THROUGH P-NOTES JUMP TO RS 78,110 CR TILL MARCH-END

Investments through participatory notes in domestic capital market rose to Rs 78,110 crore at the end of March, amid positive market sentiments. As per the latest Sebi data, the total value of P-note investments in Indian markets -- equity, debt, and derivatives -- stood at Rs 78,110 crore till March-end. The increase in P-notes investment is in line with the higher net inflows of FPIs in the cash segment, which increased from Rs 13,500 crore in February to Rs 32,000 crore in March, Vinod Nair, said. Of the total P-note investments made till March-end, Rs 56,288 crore was in equities, Rs 20,999 crore in debt and Rs 119 crore in derivatives markets.
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ON NOTICE: CENTRAL PSUS GET 12 MONTHS TO SELL NON-CORE ASSETS; FAILURE MAY LEAD TO BUDGET CUTS

Central public sector enterprises (CPSEs) will now be denied budgetary support while their staff will lose on their performance-linked pay, if these firms fail in meeting the goals of monetising their assets. The Department of Investment and Public Asset Management (DIPAM) has issued guidelines which said state-run companies will have 12 months to monetise non-core assets identified by a ministerial panel headed by the finance minister, without having to forgo Budget funds. DIPAM also included asset monetisation as one of the targets in the customary MoUs that the CPSEs sign with the Department of Public Enterprises (DPE). This means that a slippage in the performance on this count could result in a firm’s rating downgrade and consequent reduction in variable pay of its staff. Currently, performance-related pay can be as high as 150% of basic pay for CMDs while it is 40% for the lowest grade officers if the rating of the PSU performance is ‘excellent’. A downgrade would bring down MoU rating from ‘excellent’ to ‘very good’ and ‘very good’ to ‘good’, resulting in reduction from 100% eligibility of performance-linked pay to 80% and 60%, respectively. The Department of Expenditure and Department of Economic Affairs may consider any proposal from the CPSE/administrative ministry for budgetary support only after looking at the achievement of asset monetisation target by the CPSE. Performance of contract management will be considered before sanctioning any government budgetary support, the DIPAM said. The assets to be monetised by PSUs include land and buildings, brown-field operational assets such as pipelines (like that of GAIL), roads (NHAI) and mobile towers (MTNL/BSNL). It would also include financial assets like equity shares, debt securities and other hybrid instruments that are in the possession of the CPSEs. While the Centre would retain 100% of the proceeds from monetisation of non-core assets of units identified for strategic sale and enemy properties, it could share a large chunk of the proceeds with CPSEs in case operational assets are monetised. The proceeds to the Centre from asset monetisation would be counted as disinvestment receipts, which so far only included receipts from equity sales in CPSEs and other entities.
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MINDTREE DEAL A HURDLE IN L&T'S ROAD TO 18% ROE BY FY21

Larsen and Toubro Ltd’s (L&T’s) shares are down about 5% this year, even as the Nifty 50 index has risen by over 8%. The fall in L&T’s shares come despite the positive news on order flows and improving fundamentals in its core business. Worse, its one-year forward price-to-earnings multiple of 19 times is way below the levels of 24 times a year ago as well as the five-year average of 23 times earnings. The first dampener for the stock came early this year when the Securities and Exchange Board of India (Sebi) rejected its share buyback offer which was meant to return excess cash and boost return ratios. Investors have also perceived the decision to acquire software firm Mindtree Ltd as a negative in the near term because of a worry about using cash in non-core businesses. Some analysts also said it can weigh on near-term return on equity (RoE) of the company. Investors are not happy with L&T’s capital allocation to MindTree, especially in context of RoE being sub-5% at the acquired valuation multiple (of about 20 times), said Jefferies India Pvt. Ltd. L&T has set a target of achieving 18% RoE by FY21, which is now under question, given the Mindtree deal and the rejection of the buyback offer. The overhang of the general elections will also limit government capex until the second half of FY20. We do not expect the strong 15% CAGR seen in FY08-FY13 to repeat, especially as power will not be a major capex driver ahead. However, from negative growth, we expect to move to 10%+ CAGR over the next four years, said Jefferies India. However, L&T’s efforts to contain working capital should bring down interest cost as a percent of sales. Meanwhile, the March quarter is usually robust on execution, translating into better conversion of orders into revenues. Also, analysts say L&T’s order flows for FY19 will top its guidance of 10-12% growth over a year ago. Investors will hope that improved fundamentals in the company’s core business will offset the negative investor sentiment due to recent developments.
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TRAI FINDS SIX CABLE FIRMS VIOLATING NEW TARIFF ORDER, SEEKS COMPLIANCE IN 5 DAYS

Regulator Trai Tuesday said six cable TV players including GTPL Hathway and Siti Networks, violated several rules especially those related to new tariff order, and directed them to ensure compliance within five days The other players are Fastway Transmissions Private Ltd, Den Networks, and IndusInd Media and Communications Ltd (IMCL) and Hathway Digital. The Telecom Regulatory Authority of India (Trai) found that GTPL Hathway, Siti Networks, Fastway Transmissions Private Ltd, Den Networks, and IMCL are forcing channels and package schemes to the consumers, and subscribers are not able to exercise their choice till date. Trai has unveiled the new tariff order and regulatory regime for the broadcast and cable sector to facilitate consumers to opt for channels they wish to view and pay only for them. The rule has been effective since February 1. It had said every channel should be offered a la carte, with a transparent display of rates on electronic programme guide. The regulator also clarified that DTH and cable operators cannot force consumers to go in for only predefined packages or bouquets. Trai said it has received consumers' complaint that GTPL Hathway, Siti Networks, Fastway Transmissions Private Ltd and Den Networks are not providing bill receipt of the payment made in printed form to the consumers. In case of Hathway Digital, Trai found that it is offering a bouquet of TV channels which contain both free-to-air and pay channels. It found that Hathway Digital has disconnected pay channels of customers who have paid advance amount for one year without their consent and only showing them FTA channels. Also, Hathway Digital subscribers are unable to re-excercise their choice through website or toll-free number of the company. Trai asked all the six firms to report compliance as per the new regulatory framework within 5 days from the date of issue of this direction.
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MERGER OF TELCOS TO EASE COMPETITION, SHIFT FOCUS TO QUALITY: REPORT

The merger of two telecom giants – Vodafone and Idea Cellular — imply that the Indian mobile market will soon be paired down to four major national mobile operators. There are now hopes this will ease the fierce round of mergers and acquisitions in the market and ease the ferocious price war in the country, says a report by Opensignal. The merger of Vodafone and Idea Cellular is set to create India's biggest operator with around 387 million subscribers across the country. It plans to extend its 4G network to over 80 per cent of Indian users, wireless service mapping company Opensignal said. The report has considered Vodafone and Idea as individual operators. The focus is already shifting towards service quality, with both Airtel and Vodafone Idea talking up their 4G network improvement plans. On the other hand, Jio has gone one step ahead with a pledge to bring 5G to India before its rivals. It said that Jio's rivals haven't been complacent. In terms of 4G availability in India’s telecom sector, Jio continues to astound, growing its 4G availability to 97.5 per cent — the highest national score we have ever recorded. But Airtel showed the greatest growth in this category, as its average score jumped by over 10 percentage points to cross 85 per cent. A recent report from Deloitte has estimated that the total investment required to cover India with 5G would be a staggering $70 billion — partly because the country lacks widespread fibre backhaul infrastructure necessary for high-capacity networks.
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TATAS PAY GOVERNMENT FOR TELE BUSINESS MERGER WITH AIRTEL

Tatas have paid Rs 3,100 crore to the telecom department towards spectrum payment liabilities in line with their deal to sell ailing telecom business to Bharti Airtel. Airtel and the loss-making Tata Teleservices (TTSL) had announced their deal in September 2017, as part of which the former took over the consumer mobility business of the Tatas in 19 telecom circles. The deal, which allowed Tatas to exit the difficult telecom business, will bring in an additional 178.5MHz of spectrum for Airtel in three bands that are widely used for 4G. This will help Airtel tackle competition from Reliance Jio more effectively. Apart from this, the DoT has demanded bank guarantees of around Rs 7,500 crore towards one-time spectrum charge (OTSC) liability. However, it is expected that this will be challenged in Telecom Disputes Settlement and Appellate Tribunal (TDSAT) by Airtel, similar to a precedent it had done in the case of merger of Telenor.
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AIRTEL TO CHALLENGE DOT DEMAND OF RS 8.2K CR GUARANTEE FOR TATA TELE DEAL

Bharti Airtel will soon move the appellate tribunal challenging the telecom department’s demand of Rs 8,200 crore in bank guarantees as a condition for giving its final nod to the merger of the consumer mobility business of Tata Teleservices with itself. Airtel will appeal in the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) against the demand of bank guarantees of about Rs 8,200 crore from the government, which are for one-time spectrum charges (OTSC), said a person familiar with the development. There is another Rs 800 crore worth of deferred spectrum charges that has been demanded, which the operator will pay.
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JIO HAS BEST 4G AVAILABILITY AND AIRTEL TOPS DOWNLOAD SPEED: STUDY

At 97.5% 4G availability in India, Jio's 4G users enjoy the best connectivity among all countries analysed by UK-based analytics firm Opensignal’s Mobile Network Experience Report. Advanced mobile markets like South Korea, Japan, and the US have highest 4G availability ratios of around 95%. The report notes that Bharti Airtel is giving Reliance Jio a tough fight, as the former jumped 10% in the last six months to achieve 85.6% 4G reach- thereby narrowing its gap with Jio from 22% in November to 12% now. At 8.7 Mbps (megabits per second), Airtel’s download speed is 2.4 Mbps faster than rival Jio, and the company also pulled ahead of Idea, Vodafone, and BSNL by a wide margin. Airtel is also offering the most seamless video experience among its peers, as the telco jumped over five points to score 44.4 (out of 100), taking the pole position in the ‘Video Experience’ category. Netherlands, a leader in the category, has a score of 73%. In case of upload speeds (a factor crucial for social media use), Idea dominated the category at 3 Mbps. Vodafone came second with a score of 2.6 Mbps. Jio continued its command over network latency at 62.5 milliseconds, leading rival Airtel by 13%.
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SAUDI ARAMCO IN TALKS FOR 25 PER CENT OF RELIANCE'S REFINING, PETROCHEMICAL UNITS: REPORT

In what is shaping up into a mega-deal between two corporate behemoths, Saudi Aramco, the world's most profitable company in history, is learned to be in serious discussions to acquire up to 25% in the refining and petrochemicals businesses of Reliance Industries Ltd, India's largest company. While Saudi Aramco, which is also the world's largest oil exporter, is known to have first shown interest in Reliance about four months ago, talks gathered momentum following the visit of Saudi crown prince Mohammed bin Salman (MBS) to India in February, during which he met RIL chairman and India's richest man, Mukesh Ambani. There might be an agreement on valuation around June this year, people with knowledge of the development said. A minority stake sale could fetch around $10-15 billion valuing RIL's refining and petrochemicals businesses at around $55-60 billion. Goldman Sachs, the storied investment banker, is said to have been mandated to advise on the proposed deal. RIL has grown too big - from energy to retail to telecom. It needs to compartmentalise. It makes sense to spin off some of its verticals. It'll help raise funds and unlock shareholder value, said a highly placed person in the financial sector who didn't wish to be quoted since he didn't have direct knowledge of the matter. It was after he attended Mukesh Ambani's daughter Isha's pre-wedding festivities in Udaipur in December that Saudi oil minister Khalid al-Falih publicly signalled Aramco's interest in forming joint ventures, including with RIL, to expand India's refining capacity, which is currently straining at around 4.6 bpd. Domestic crude oil consumption is expected to more than double to 10 million bpd by the year 2040.
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IBBI TO CONDUCT ROADSHOW IN HONG KONG TO HIGHLIGHT OPPORTUNITIES IN STRESSED ASSETS

Continuing with its efforts to build awareness on investment opportunities in the burgeoning stressed assets market in India, insolvency regulator IBBI, in association with FICCI, will hold a roadshow in Hong Kong next week. It is reckoned that greater participation of investors in stressed assets will make the resolution process more competitive and ensure sustainable turnaround of stressed assets. The roadshow — to be held during April 24-26 — follows the one held in New York and Toronto in December last year, official sources said. In India, the huge potential for resolution of stressed assets through the Insolvency and Bankruptcy Code (IBC) has been attracting interest from domestic and global investors. Already within a short span of time about 1,600 companies have been admitted into the corporate insolvency resolution process. About 400 of them have completed the process, either yielding resolution plans or ending up in liquidation.
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AHEAD OF ETAIL LAUNCH, RELIANCE INDUSTRIES PULLS OUT BRANDS FROM RIVALS

As a precursor to the launch of its own business-to-consumer (B2C) marketplace that will sell everything from food to fashion, Mukesh Ambani’s Reliance Industries has started withdrawing its clothes, shoes and lifestyle products from would-be rival marketplaces like Amazon and Flipkart. These include its own as well as global brands for which the group has selling rights in India. The process of withdrawals has gathered pace in recent months as RIL prepares for its major online initiatives later this year, according to three people aware of the development. RIL has the highest number of global fashion and lifestyle brands in its stable with around four dozen joint ventures or master franchisee arrangements with international labels. Many of these brands are sold online on Amazon, Flipkart, Myntra, Jabong and Tata Cliq, among other sites. Reliance wants to create exclusivity for global as well as its own brands to attract consumers to its portal. Reliance Trends and Reliance Brands have been asked to expedite the phasing-out process from non-Reliance marketplaces in the coming weeks, sources said. Reliance has stopped taking new orders Whatever is available on the third-party marketplaces will be sold till the stocks are exhausted, said a person with direct knowledge of the development. Another person said Reliance Brands, the flagship subsidiary that holds rights for the majority of global brands, has been instructed by the head office to stop supplies to third-party marketplaces from this month. They have been told to sell only on Ajio-.com and through their own monobrand sites for different labels, the person said, asking not to be identified. Reliance Brands clocked revenue of Rs 336.41 crore in FY18.
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RIL TO SELL STAKE IN 6 VERY LARGE ETHANE CARRIER COMPANIES TO JAPAN’S SHIPPING MAJOR

Mukesh Ambani-led Reliance Industries announced on Wednesday that its wholly owned unit Reliance Ethane Holding has struck a deal with Japan’s shipping major Mitsui OSK Lines for a strategic investment into Reliance’s six ‘very large ethane carriers.’ Notably, Reliance Ethane Holding has a 100% holding in six limited liability companies (LLCs) which own Very Large Ethane Carriers (VLEC). REHPL, Mitsui O.S.K Lines of Japan and a strategic minority investor have signed binding definitive agreements for a strategic investment by MOL and minority investor in the six special purpose limited liability companies (SPVs), each owning a VLEC, Reliance Industries said in a press release. The transaction is subject to regulatory approvals. Further, post closing, the SPVs shall be jointly controlled by REHPL and MOL. Taking stock of the strategic rationale, PMS Prasad, Executive Director, RIL said that the deal will improve efficiency of the VLECs. Given MOL is currently the operator of all the six VLECs, investment by MOL will deepen our relationship with them and ensure continued safe and efficient operations of the VLECs. We welcome MOL as a atrategic partner into the SPVs as they move beyond the current operator role to joint owner and operator role in the SPVs, Prasad said.
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NIPPON PAINT OFFERS $ 2.7 BN BID FOR AUSTRALIA'S DULUX GROUP

Japan's Nippon Paint Holdings Co Ltd has proposed buying Australia's biggest paint maker Dulux Group Ltd for A$3.8 billion ($2.7 billion), expanding its global footprint though entering Australia just as a housing boom there falters. The cash deal was recommended by the Dulux board and sent its stock soaring 28 per cent to the offer price, a record high. It would catapult Nippon Paint, the world's fifth-largest paint maker, from a bit player to the biggest paint seller in the region. It also offers investors in Dulux, whose paint colours more than a quarter of Australia's homes and buildings, a chance to cash out at the end of a long construction boom. The price point that they've paid is quite incredible, said Portfolio Manager Jun Bei Liu at Tribeca Investment Partners, a fund manager which exited Dulux Group stock ahead of a slowdown in the building materials sector. The proposal comes after Nippon Paint has scoured the globe for big deals to buy growth away from its stagnant home market.
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AMAZON PLANS TO SHUT ITS CHINESE E-COM MARKETPLACE TO FOCUS ON INDIA

In a rare retreat for Amazon.com Inc., the e-commerce giant plans to shut down its Chinese marketplace business in July as it shifts its focus to offering mainland consumers overseas products rather than goods from local sellers. Amazon will keep running its other businesses in China, including Amazon Web Services, Kindle e-books, and cross-border operations that help ship goods from Chinese merchants to customers abroad. Starting on July 18, customers logging in to Amazon’s Chinese web portal, Amazon.cn, will only see a selection of goods from its global store, rather than products from third-party sellers. Pulling out of Chinese e-commerce represents a setback for the company in the world’s largest retail market and for Chief Executive Officer Jeff Bezos, known for his willingness to weather losses to achieve long-term gains. It’s also the latest example of an American tech company in China struggling to contend with local leaders like Alibaba Group Holding Ltd and JD.com Inc., as well as group buying app Pinduoduo Inc., which went public in New York last year. The pullback is the latest sign that Amazon is ceding China so it can focus on India, where it stands a better chance of becoming a dominant player. The company has plowed billions of dollars into the India business since opening its website there in 2013, building more than 50 warehouses to support the business. But Amazon still has to contend with Chinese e-commerce players in India, where Alibaba and others are building up operations or investing in local startups such as Paytm E-commerce Pvt and BigBasket.
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WALMART CEO SAYS COMMITTED TO INDIA, A YEAR INTO FLIPKART DEAL

Almost a year into writing a $16 billion cheque for Flipkart, Doug McMillon Tuesday said the US retail firm continues to be committed to the Indian market given the huge opportunity that the country presents. McMillon, also highlighted that a level-playing field is important to ensure growth for businesses operating in the country. McMillon expressed satisfaction at the progress made by Flipkart and said Walmart is aggressive on the Indian market given the size of the opportunity. Asked about the recent regulatory challenges in the Indian market, McMillon said Walmart has operations across multiple countries and complies with local laws in individual markets but asserted that a level-playing field is important and that is what businesses seek. The government had tightened norms for e-commerce firms with foreign investment with effect from 1 February. These regulations barred online marketplaces like Flipkart and Amazon from selling products of companies where they hold stakes and banned exclusive marketing arrangements that could influence product price. A separate e-commerce policy is also in the works.




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