Kotak Mahindra Bank on Thursday announced the acquisition of German carmaker Volkswagen’s captive vehicle finance business for an undisclosed sum.
The deal involves the private sector lender’s in-house NBFC Kotak Mahindra Prime acquiring the passenger car and two-wheeler portfolio, while Kotak Mahindra Bank Limited (KMBL) will acquire the commercial vehicles portfolio from Volkswagen Finance (VF), as per an official statement.
Kotak will gain access to over 30,000 high-quality customers with a total loan outstanding with VWFPL of around ₹1,340 crore, the statement said, adding all these loans have been classified as “standard loans”.
Retail portfolio
The deal also involves the acquisition of VF’s non-performing assets, it said, without spelling out the size of the book.
“The strategic intent behind this acquisition is to further strengthen Kotak’s vehicle financing loan portfolio and expand our market share,” D Kannan, the bank’s group president for commercial banking, said.
He said VF, which had been in India since 2009, has built a strong portfolio, and added that the long term prospects of the Indian vehicle market are very attractive.
Kannan assured a seamless transition for VF customers to Kotak Group, and added that they will also get access to a wider suite of products and services.
“The sale of our retail portfolio aligns to our new strategic focus towards a refined digital strategy through our subsidiary, the digital platform KUWY,” VF’s managing director and chief executive Aashish Deshpande said.
This is a step towards the evolution of the customer journey in the digital space by offering a simplified and agile solution to both our customers and dealerships, while aligning effectively to support the VW India 2.0 strategy, he added.
The Kotak Mahindra Bank scrip closed 1.87 per cent higher at ₹1,905.75 a piece on the BSE on Thursday.
The following queries were sought by the firms which participated in the pre-bid meeting:
S. No.
Name of firm
Section / Sub section of tender document
Query / Suggestion by firm(s)
Bank’s Remarks
1
M/s Diamond Renewable Solutions Pvt Ltd.
M/s Su Solartech Systems (P) Ltd.
General query
Site details with sanctioned load of already installed meters
Site was visited by the participants along with the Bank’s Engineers. Copy of previous electricity bills was also provided to the participants for evaluation.
2
M/s Indesolar unit of Independent Business Machines Pvt. Ltd.
Clause 7.10.3 (a) of Section VII: PCU / MPPT and 3 phase with neutral inverter shall be supplied as integrated unit ……..
In small power plants, instead of 3 phase inverter, single phase inverter may be used.
No specifications / requirements will be changed. Hence please follow the tender in this regard.
3
M/s Indesolar unit of Independent Business Machines Pvt. Ltd.
Clause 3.15 of Section III: Insurance
For which period insurance is to be obtained.
As per the tender conditions.
4
M/s Indesolar unit of Independent Business Machines Pvt. Ltd.
Clause 7.0 A (l) of Section VII: Replacement of existing conventional energy meter provided by local electricity department …….
Whether Bank will reimburse the laisoning charges, cost of replacement of meters, etc. to the bidders
As per clause 7.0 A (l) of Section VII, Bank will reimburse the cost of replacement of meters on production of original receipts provided by the electricity department. Bidders are required to consider the laisoning charges in the rates quoted by them.
5
M/s Diamond Renewable Solutions Pvt Ltd.
M/s Indesolar unit of Independent Business Machines Pvt. Ltd.
Clause 3.4 (a) of Section III: Intending tenderers shall remit as Earnest Money a sum of ₹28,000/- (Rupees Twenty Eight Thousand Only) ……..
As Per MSME Act of GOI, all MSMEs are exempted from submission of EMD. We request you to give exemption from submission of EMD to us.
As per extant guidelines of RBI, exemption for submission of EMD to MSMEs is applicable only for estimated cost up to ₹10.00 lakh.
As the estimated cost of this work is ₹14.00 lakh, EMD exemption is not applicable.
6
M/s Diamond Renewable Solutions Pvt Ltd.
M/s Indesolar unit of Independent Business Machines Pvt. Ltd.
M/s Su Solartech Systems (P) Ltd.
Clause 3.12.3 of Section III: Performance Bank Guarantee (PBG)
We request you to decrease the amount of Performance Bank Guarantee from 10% of the contract value to 3% only.
The successful bidder will be required to submit Performance Bank Guarantee of 10% only of the contract amount as mentioned in the contract document.
7
M/s Diamond Renewable Solutions Pvt Ltd.
M/s Indesolar unit of Independent Business Machines Pvt. Ltd.
Clause 7.10.6 of Section VII: The scope of work shall include for supply and installation of pyrometer, temperature probes for recording the solar panel temperature, anemometer….
In small power plants, there is no need for pyrometer, temperature probes and other weather monitoring units. We will provide remote monitoring for this purpose.
No specifications / requirements will be changed. Hence please follow the tender in this regard.
8
M/s Diamond Renewable Solutions Pvt Ltd.
Clause 3.25 of Section III: Pre-dispatch Inspection
Since these are small solar plants, will the Bank accept manufacturer’s test certificate instead of inspection and testing by Bank as mentioned in the tender document?
Successful bidder will be required to submit various test certificates issued by the manufacturer. Also, as per the tender condition, the inspection and testing of the material will be at the discretion of Bank.
9
M/s Indesolar unit of Independent Business Machines Pvt. Ltd.
Annexure H
Instead of banker’s certificate, CA’s certificate should be enough for turnover purpose.
Chartered Accountant’s certificate is compulsory for turnover purpose (for the last 3 FYs). Also, a certificate from bidder’s banker is also required (format is given in Annexure H).
Welcome to the refurbished site of the Reserve Bank of India.
The two most important features of the site are: One, in addition to the default site, the refurbished site also has all the information bifurcated functionwise; two, a much improved search – well, at least we think so but you be the judge.
With this makeover, we also take a small step into social media. We will now use Twitter (albeit one way) to send out alerts on the announcements we make and YouTube to place in public domain our press conferences, interviews of our top management, events, such as, town halls and of course, some films aimed at consumer literacy.
The site can be accessed through most browsers and devices; it also meets accessibility standards.
Please save the url of the refurbished site in your favourites as we will give up the existing site shortly and register or re-register yourselves for receiving RSS feeds for uninterrupted alerts from the Reserve Bank.
Do feel free to give us your feedback by clicking on the feedback button on the right hand corner of the refurbished site.
Rajiv Rattan headed is a business conglomerate based out of Delhi. The company’s work areas span power generation, consumer finance, renewable energy and electric mobility. The group’s combined assets are equivalent to $2.7 billion.
The company’s TTM P/E is at a negative -7264.3 while the sector P/E is at 21.37.
As of last the company commanded a market cap of Rs. 6503 crore.
Poonawalla Fincorp:
This is an NBFC company commanding a market capitalization of Rs.13,142 crore . A host of brokerages are bullish on the scrip as there is a recent management change which is seen to be positive for the scrip.
There was indeed seen a downside in today’s trade as the SEBI banned the company’s managing director for insider trading.
The lending company is into offering a bouquet of loans from personal to professional loans and even insurance services.
HFCL:
The company is a leading telecom company and specializes in manufacturing of telecom equipment, optical fiber cables and intelligent power.
The focus on to 5 G technology has also improved the prospects of the company going ahead.
TTM P/E- 32.49
Sector P/E- 88.18
Tata Steel BSL:
The company in the year 2018 has been acquired by Tata Steel which was previously known as Bhushan Steel. The company is now the third largest secondary steel producing company with an existing steel production capacity of 5.6 million ton per annum. The company’s products included Hot Rolled Coil ,CRCA ,CRFH ,Galvanized Coil and Sheet ,Galume Coil and Sheet ,Color Coated Coils,Color Coated Tiles,High Tensile Steel Strips,Hardened & Tempered Steel Strips,Precision Tubes,HFW/ERW Pipe (API Grade),3LP Coated Pipes,Billets and Sponge Iron.
TTM P/E- 1.8
Sector P/E- 4.43
Shree Renuka Sugars
Headquartered in Mumbai and with head office in Belgaum, the company is the largest sugar producers globally. The company is a global agribusiness and bio-energy corporation. Additionally, the company is also into refining of sugar.
The recent push for ethanol blending for fuel will augur well for the company going ahead.
P/E TTM- -20
Sectoral p/E- 13.27
Conclusion:
These penny stocks have relatively infrequent trading which indicates less buyers and hence low liquidity. With low or limited trading, these stocks are subject to high volatility. Though considered affordable, every other investor should not take a buy decision on them given the huge volatility.
Disclaimer:
The information or the scrips collated above need not be construed for investment advice.
The planned National Asset Reconstruction Company Ltd (NARCL) will issue securities receipts to banks as it takes on non-performing assets from their books. These securities receipts will be valid for five years.
“The idea behind it is to ensure value locked within assets is used making banking system robust. So limit provides an incentive for banks. If process delayed beyond 5 years, guarantee can’t be invoked,” Sitharaman said.
The NARCL will pay up to 15% of the agreed value for the loans in cash and the remaining 85% would be government-guaranteed security receipts, the finance minister announced. State-owned banks will hold 51% stake, while FIs or debt management companies will hold 49%.
Financial Services Secretary Debasish Panda said the government will not face any fiscal outgo for the guarantees it provides to banks. NPAs worth Rs 2 lakh crore will be sent to the NARCL, and of this Rs 90,000 crore will be transferred in the first phase.
Along with NARCL, the government will also set up an India Debt Resolution company. The service company will manage assets and loop in market professionals and turnaround experts. Public sector banks and public FIs will hold a maximum of 49% stake and the remaining will be held by private banks.
The banks’ asset quality review had happened in 2015, which had revealed very high incidence of NPAs. After recognition, quantification of NPAs started in a planned manner and state owned banks, in the last six years, recovered Rs 5,01,479 crore, she said.
In 2018, just two out of 21 public sector banks were profitable. But in 2021, only two banks reported losses, Sitharaman added.
During the Union Budget 2021-22, Sitharaman had announced the creation of NARCL or bad bank to resolve large cases of stress. The bad bank will manage and dispose the assets to alternate investment funds and other potential investors for eventual value realisation, she had said.
In August, the Indian Banks’ Association (IBA) moved an application to the Reserve Bank of India (RBI) seeking licence to set up a the Rs 6,000-crore bad bank. The NARCL was incorporated last month in Mumbai, following the registration with Registrar of Companies.
According to Hawkins Cookers Ltd “Proposed time schedule mentioning the date of opening of the Scheme and the time period for which the circular or advertisement is valid from September 15, 2021, to September 30, 2022, or the date of the Company’s 62nd Annual General Meeting, whichever is earlier.” The following interest rates will be applicable on minimum deposits of Rs.25,000 and in multiples of Rs.1,000 subject to a maximum of Rs.20,00,000.
Hawkins Cookers FD Ratings & Mode of Interest Payout
ECS/Direct Credit/RTGS/NEFT/Warrant mode will be used for interest payment and repayment. Deposits can be repaid through ECS/Direct Credit/RTGS/NEFT/Cheque, subject to SEBI and RBI restrictions. Hawkins Cookers Ltd has obtained [ICRA] MAA (Stable) rating by the Credit Rating Agency ICRA Limited. The rating was issued on July 21, 2021, and it simply means that the company has excellent credit quality with minimal credit risk. The credit rating of Hawkins Cookers Limited is a quantifiable evaluation of the company’s credibility that educates investors about the risk of the company failing on its financial commitments.
It is mandatory for interested investors to pre-register their interest online at www.hawkinscookers.com/fd2021.aspx from 9:30 am onwards on September 15, 2021, according to the circular of the company. The Fixed Deposit form along with the detailed Terms and Conditions can be downloaded from www.hawkinscookers.com/fdform2021.pdf.
Should you invest?
Amid the current low interest rates on fixed deposits of leading private and public sector banks, small finance banks offer higher interest rates with DICGC insurance benefit on fixed deposits up to Rs 5 lakhs which makes investment in small finance banks risk-free up to the amount covered. However, when it comes to corporate deposits, such as Hawkins Cookers Fixed Deposit Scheme, the only condition on which investors should rely is the credit rating.
Placing a fixed deposit with a positive score is a safe bet, which is why Hawkins Cookers FD Scheme can be a good option for debt investors as the company has obtained MAA (Stable) rating by the Credit Rating Agency ICRA Limited. As a result, investing in Hawkins Cooker FDs may be a better option than investing in a leading bank’s fixed deposit scheme like SBI, which offers a low-interest rate of 5,40 percent as of now. However, we advise our readers to briefly look at the applicable terms and conditions, inflation risk, and taxation as per your income tax slab which may lower your post-tax return if you are in the higher tax bracket.
If the interest income received on a corporate FD surpasses Rs. 5000, the TDS rate is 10% for all resident Indian citizens. TDS deduction on FD interest is charged at 20% if PAN details are not submitted, it is one of the main considerations apart from higher rates and credit rating which our readers should keep in mind. Last but not least, it is critical to select Corporate FD with caution and to reduce the risk of default, choose only those certified ‘AAA’ in terms of rating.
Investors these days are being more patient and staying put in the equity markets for the long-term, expecting better returns. However, some investors are yet not comfortable with the equity markets because of their volatility. They are interested in profit maximization beyond the stock market, in a short-term period. Bank Fixed Deposits (FD) or Life Insurance plans do not attract them because of their lengthy timeline and inflation dilemma. The below discussion is for those investors. The investment option is called invoice discounting – which is related to both MSMEs and big companies, in two different segments.
How is invoice discounting being operated?
Be it a big company or a medium scale company, when they are operating in a market they are most likely to sell products/goods to the buyers. Now, when a product is sold in the market, this includes multiple ingredients and items within it. For example, if Apple is selling mobile phones in the market, they will certainly need parts or materials like packaging items, metal parts, glass, etc. These will be manufactured by other suppliers to send to Apple, and they will assemble the parts, enable the software, do the packaging, and sell the final product. Here comes the importance of the suppliers or manufacturers.
When Apple will order its supplier to make mobile parts for them, they will not give the total payment for those parts. Rather, they will offer the suppliers an invoice that will commit the full payment for the manufactured parts, which will be paid after around 30-90 days. With this commitment, the manufacture will supply the parts to Apple. But what happens if the supplier needs the money immediately, cannot wait any longer? Then the supplier can sell the invoice to other investors in the market by online financial platforms. The investor will have to pay the amount payable by Apple to the supplier, but they will get a discount of 20%. Later the production company will pay the full amount directly to the investor, whereby the investor will have a profit margin.
This is why the investment option is called invoice discounting. For example, if the total amount payable by Apple is Rs. 1000, the investor will pay only Rs. 800 to the supplier. The 20% loss is neglected because it is assumed that the supplier has already counted profits within this amount. Thus, the supplier can fulfill its demand of immediate money, with a lesser profit. Later, after 30-90 days, at the time of payment, when Apple will remunerate for the parts, they will directly pay the full Rs. 1000 to the investor. So, in that way, within a very short period of 30-90 days, the investor will earn a good profit.
Profit share
However, the total profit of 20% is not attributed to the investor alone. A margin of this, at around 8%, is taken by the online financial platform, where the invoice was sold by the supplier. Hence, the rest 12% will be given to the investor. Now, this 8% and 12% can vary depending on the companies involved and the platforms.
In India mostly the MSME sector runs its operations through an invoice discounting system to earn their working capital. They manufacture for large-scale companies and earn the amount immediately from investors. Investors then after the short-term period earn their 12% profit.
Risk factors
The invoice discounting is a great investment opportunity, keeping in mind certain risk factors. The investor should always analyze the brand value of the company who will give the final payment. The credit history or credit risk should be checked, to understand how and when they have done their earlier payments. Along with this, the company’s insolvency factor or debt obligation should be another concern to look at.
On the other hand, the manufacturer company, who is dealing the invoice, should also be checked to understand if they are good companies or not. Otherwise, they might deal with invoices that are not going to be settled in the future. Also, the disputed invoice is another risk; if the sold products are disputed, then the big company can reject to pay the money, or can pay only a percentage of the total amount payable. In that case, the investor will face loss.
Invoice Discounting platforms
KredX, Receivables Exchange of India Ltd (RXIL), TradeCred, Finovate Capital, Invoice Mart, M1 Treds, and Priority Vendor are some of the popular online debt platforms, where the invoice discounting ecosystem is operated. In these platforms, the investors should find the risk mitigations, financial reports, credit history, shareholders details, internal rate of return (IRR), etc. to have a better outlook on the deal.
However, this investment option is most likely for big investors who can put a lump sum amount in this, a very small-scale investment will not be appropriate for the field. Also, not all of the companies – manufacturers or sellers will be reputed companies here. So, an in-depth study of the companies is required for invoice discounting.
For investment related articles, business news and mutual fund advise
Welcome to the refurbished site of the Reserve Bank of India.
The two most important features of the site are: One, in addition to the default site, the refurbished site also has all the information bifurcated functionwise; two, a much improved search – well, at least we think so but you be the judge.
With this makeover, we also take a small step into social media. We will now use Twitter (albeit one way) to send out alerts on the announcements we make and YouTube to place in public domain our press conferences, interviews of our top management, events, such as, town halls and of course, some films aimed at consumer literacy.
The site can be accessed through most browsers and devices; it also meets accessibility standards.
Please save the url of the refurbished site in your favourites as we will give up the existing site shortly and register or re-register yourselves for receiving RSS feeds for uninterrupted alerts from the Reserve Bank.
Do feel free to give us your feedback by clicking on the feedback button on the right hand corner of the refurbished site.
Welcome to the refurbished site of the Reserve Bank of India.
The two most important features of the site are: One, in addition to the default site, the refurbished site also has all the information bifurcated functionwise; two, a much improved search – well, at least we think so but you be the judge.
With this makeover, we also take a small step into social media. We will now use Twitter (albeit one way) to send out alerts on the announcements we make and YouTube to place in public domain our press conferences, interviews of our top management, events, such as, town halls and of course, some films aimed at consumer literacy.
The site can be accessed through most browsers and devices; it also meets accessibility standards.
Please save the url of the refurbished site in your favourites as we will give up the existing site shortly and register or re-register yourselves for receiving RSS feeds for uninterrupted alerts from the Reserve Bank.
Do feel free to give us your feedback by clicking on the feedback button on the right hand corner of the refurbished site.
Two months after getting hit by the regulatory ban on Mastercard, private sector lender RBL Bank on Wednesday restarted credit card issuances on rival Visa‘s payment network.
The Reserve Bank of India had banned Mastercard from issuing any new cards on July 14 this year for not complying with data localisation requirements. The move had hit a slew of lenders, including RBL Bank, which was fully dependent on the American payment company for its credit card business.
RBL Bank said it signed up with Visa on July 14 itself, and the technology integration was achieved in record time to restart new issuances.
Its head for retail business thanked Visa and technology partner Fiserv, and exuded confidence of meeting its target of issuing 12-14 lakh credit cards in FY22.
Visa’s head of business development for India Sujai Raina said the company aims to enable digital payments and help customers avail credit offerings from issuers with ease.
Credit cards contribute 37.5 per cent of the retail book for the lender, which has a 5 per cent market share in the segment. Its credit card book had grown 17 per cent to Rs 12,039 crore as of June, and had 30.69 lakh cards outstanding as of July.
The bank in its guidance had said that by mid-September, it will restart issuances and hoped to do 1 lakh cards a month on average.
The RBL Bank scrip was trading 2.42 per cent up at Rs 179.60 a piece on the BSE at 1252 hrs, as against gains of 0.59 per cent on the benchmark.
