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Currency Trading: 4 Currency Trading Pairs Available In India 2021

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What is Currency Trading in India?

A currency future, often known as an FX future, is a futures contract that allows you to exchange one currency for another at a fixed price (exchange rate) on the purchase date. The price of a futures contract is expressed in INR per unit of another currency, such as US Dollars. Currency future contracts allow investors to protect themselves against the risk of currency depreciation. The US Dollar (USD), Euro (EUR), Great Britain Pound (GBP), and Japanese Yen (JPY) are the four currency pairs on which currency derivatives are available.

In the Currency Derivatives sector, cross-currency futures and options contracts on the EUR-USD, GBP-USD, and USD-JPY are also accessible for trading.

The National Stock Exchange (NSE), the Bombay Stock Exchange (BSE), and the Metropolitan Stock Exchange of India Ltd all offer forex trading.

Currency futures are available for all of the following currency and cross-currency pairs, however, Currency Options are only available for USDINR, EURINR, GBPINR, and JPYINR.

USD to INR

USD to INR

The acronym for the US Dollar versus the Indian Rupee is USD/INR. This Asian currency pair is classified as a developing market currency. The base currency is the US Dollar, and the quote currency is the Indian Rupee.

The market price defines the value of the Indian Rupee in relation to the US Dollar. 1 USD = X INR is the exchange rate. So, if the market price of USDINR is 71.46, it will cost about Rs 71 to buy $1.

The US Dollar is the world’s most widely convertible currency and is frequently used as a benchmark in the Forex market. It is held by practically every central bank in the world as the leading global reserve currency. Furthermore, because the dollar is the standard currency in the commodities market, it has a direct impact on commodity pricing.

1 US Dollar to Indian Rupee stats

Last 30 Days
High 74.985
Low 74.081
Average

74.471
Volatility 0.20%

EUR to INR

EUR to INR

Euro member countries use the Euro as their currency. The EUR to USD rate is the most popular Euro conversion rate, according to our currency rankings. Euros have the currency code EUR and the currency sign €.

The market price defines the value of the Indian Rupee in relation to the Euro. 1 Euro = X INR is the exchange rate. So, if the market price of EURINR is 88, it will cost about Rs88 to buy €1.

Many Euro-zone regions, departments, and sovereign entities, such as the Azores, Balearic Islands, and Canary Islands, use the Euro. In Cuba, North Korea, and Syria, the Euro is utilized as a trading currency, and several currencies are pegged to it.

1 Euro to Indian Rupee stats

Last 30 days
High 88.528
Low 87.409
Average 88.062
Volatility 0.24%

GBP to INR

GBP to INR

GBP is the currency code for British Pounds. £ is the currency symbol. The British Pound is the world’s oldest currency and one of the most widely convertible currencies. The GBP is tied to the Falkland Islands, Gibraltar, and Saint Helena. The Bank of England is the United Kingdom’s central bank. The British Pound is the world’s third most held reserve currency, while it is the fourth most traded currency. The British Pound is also known as the Pound Sterling, Sterling, Quid, Cable, and Nicker.

The market price defines the value of the Indian Rupee in relation to the Euro. 1 GBP = X INR is the exchange rate. So, if the market price of GBPINR is 103, it will cost about Rs103 to buy £1.

1 British Pound to Indian Rupee stats

Last 30 Days
High 103.70
Low

101.61
Average 103.01
Volatility 0.30%

JPY to INR

JPY to INR

JPY is the currency code for the Japanese Yen. The sign for the currency is ¥. The Japanese yen is the world’s third most traded currency, and Asia’s most extensively traded currency. The Japanese Yen is frequently used in carrying trades with the Australian Dollar and the US Dollar due to its low interest rates. A carry trade is a strategy that involves trading a low-interest-rate currency for a higher-interest-rate currency.

1 Japanese Yen to Indian Rupee stats

Last 30 days
High 0.68456
Low 0.67321
Average 0.67716
Volatility 0.37%



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Gold Prices Fall By Rs 850- To Rs 1000: Is It A good Time To Invest?

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Investment

oi-Kuntala Sarkar

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Late this week, gold on the MCX, gold (FUTCOM – expires on 5th October) dropped by Rs. 952, pushing the price at the local jewellers down by a similar amount. Depending on the city you were in, gold prices on Saturday were down Rs 850 to Rs 1,000, per 22 karats for 10 grams. On Sunday, gold prices at the local jeweller is unlikely to change, as trading does not take place in the global or local markets.

Gold Prices Fall By Rs 850- To Rs 1000: Is It A good Time To Invest?

Will gold prices fall further next week?

Let’s understand the fact that India does not mine gold. We are dependent on gold imports. So, if gold prices in the international markets go higher, they go up in India too and when they fall they fall in India too. Late this week, gold prices dropped by 2.5% in the global markets, pushing prices in India by a similar margin.

Why did the price of gold drop?

The already falling prices of gold faced another strike by the recent data – published by the US’s Labor Department. The report stated the present employment rates and how wages performed in the country. Overall the data gave a positive tone. Unemployment rate sunk to 5.4% from 5.9% in June. The average hourly earnings gain has been 0.4% and work-week has been steady. Non-farm payrolls have also increased by 943,000 in July. It certainly gives an indication that the USA’s economy is gaining its pace again. Personal income of people is up-scaling and productions going up too – as more people are getting engaged into jobs.

When the economy is gaining is momentum back, it is expected the USA’s Federal Reserve might increase interest rates. Earlier the Fed declared they are not thinking to increase the rates any time soon. But the jobs data released on Friday might change the decision. As interest rates go up, government bond yields will go higher and the US dollar will gain strength. People will be more interested to invest in government bonds, so, major commodities will lose their value. Hence we are witnessing a selling pressure in gold. Apart from this, a major problem is that the US Fed may announce a gradual tapering of its bond buying programme. This may lead to a further fall in gold prices, as liquidity is being withdrawn from the system.
Markets will be keeping a watch on the Jackson Hole Economic Symposium, which is likely by end of August. The Fed Chair Jerome Powell at the platform may indicate a timeline to start outlining the central bank’s tapering plans. If there is some kind of indication, gold prices could fall in the international markets, pulling gold prices in India lower as well.

In the global markets, gold closed at $1762 an ounce, dropping 2.5%, post the employment numbers in the US. It is likely that we might see some more downtick later this week. If this were to happen, prices in India would drop automatically. All in all, US inflation numbers, US job numbers and the Jackon Hole meeting in the month of August would be key to gold movement in the international markets and hence in the Indian markets.

Story first published: Sunday, August 8, 2021, 8:59 [IST]



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Yes Bank Revises Interest Rates On Fixed Deposits: Check New Rates Here

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Yes Bank Fixed Deposit Interest Rates (W.e.f. August 5, 2021)

Yes Bank now provides an interest rate of 3.25 percent on deposits maturing in 7 to 14 days, 3.50 percent on deposits maturing in 15 to 45 days, and 4.00 percent on FDs maturing in 46 to 90 days, following the most recent adjustment. On domestic term deposits maturing in 3 months to less than 6 months and 6 months to less than 9 months, Yes Bank now offers 4.50 percent, 5.00 percent, respectively. The Bank offers a 5.25 percent interest rate on FDs with a maturity duration of 9 months to less than one year whereas deposits maturing in 1 year to less than 18 months, Yes Bank is now promising an interest rate of 5.75%.

Term deposits maturing in 18 months to less than 3 years and 3 years to less than 5 years. Yes Bank is currently offering an interest rate of 6.00% and 6.25% respectively. For long-term deposits maturing in 5 years to less than 10 years, Yes Bank is now giving an interest rate of 6.50%. On their term deposits, senior citizens will undoubtedly continue to get an additional rate of interest compared to the general public. For deposits maturing in 7 days to 10 years, senior citizens will get an interest rate ranging from 3.75% to 7.25%.

Yes Bank FD Rates For The General Public

Yes Bank FD Rates For The General Public

For a deposit amount of less than Rs 2 Cr, Yes Bank is now offering the following interest rates to the regular citizens after the most recent revision.

Period Regular FD Rates Annualized Yield
7 to 14 days 3.25% 3.25%
15 to 45 days 3.50% 3.50%
46 to 90 days 4.00% 4.00%
3 months to less than 6 months 4.50% 4.50%
6 months to less than 9 months 5.00% 5.03%
9 months to less than 1 Year 5.25% 5.32%
1 year less than 18 Months 5.75% 5.88%
18 Months to less than 3 years 6.00% 6.14%
3 Years to less than 5 years 6.25% 6.40%
5 Years to less than equal to 10 years 6.50% 6.66%
Source: Yes Bank

Yes Bank FD Rates For Senior Citizens

Yes Bank FD Rates For Senior Citizens

Yes Bank offers an additional rate of 0.50% for deposits maturing in 7 days to less than 3 years whereas deposits maturing in 3 years to less than 10 years, Yes Bank offers an additional rate of 0.75% to senior citizens. Following the most recent adjustment, Yes Bank is now offering the below-listed interest rates to senior citizens for a deposit amount of less than Rs 2 Cr.

Period Senior Citizens FD Rates Annualized Yield
7 to 14 days 3.75% 3.75%
15 to 45 days 4.00% 4.00%
46 to 90 days 4.50% 4.50%
3 months to less than 6 months 5.00% 5.00%
6 months to less than 9 months 5.50% 5.54%
9 months to less than 1 Year 5.75% 5.83%
1 year less than 18 Months 6.25% 6.40%
18 months to less than 3 years 6.50% 6.66%
3 years to less than 5 years 7.00% 7.19%
5 years to less than equal to 10 years 7.25% 7.45%
Source: Yes Bank

Premature Penalty On Fixed Deposits

Premature Penalty On Fixed Deposits

If a fixed deposit is either prematurely withdrawn or closed after it has been maintained for a period of 182 days or more, the below-listed penalty charges will be imposed by Yes Bank.

Tenure of Fixed Deposit (Completed) Penalty
Less than equal to 181 days Nil
182 days and above 0.50%
Penalty Structure for Fixed Deposits with a value of less than 5 Cr, W.e.f. 5th July 2019



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4 Auto Stocks At Discount To Long Term Averages, Should You Buy?

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Auto stocks that are available at a discount in terms of 10-year p/e averages

p/e current 10-year average p/e Discount
Mahindra CIE 16.5 28.5 -42%
Motherson Sumi 24.3 27.5 -12%
HeroMoto Corp 14.0 17.7 -21%
Bosch 30 36.4 -18%

(Courtesy: Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services)

Just because a stock is at a discount, does not make it a good pick by default. There could be many challenges for such companies including management issues, growth issues or other promoter related problems. Each company needs to be analyzed in detail for the same.

Should you buy Mahindra CIE, Motherson Sumi, HeroMoto Corp and Bosch shares?

Should you buy Mahindra CIE, Motherson Sumi, HeroMoto Corp and Bosch shares?

The auto sector is trading at a P/E of 22.5 times, at a 5.3% premium to its historical average of 21.4x, Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services.

To begin with several brokerages are optimistic on the stock of Mahindra CIE. Emkay Global and Motilal Oswal had a buy on the stock, with a price target of Rs 280 and Rs 295. With the stock now at Rs 269, there is very limited scope for appreciation. Therefore, this many not necessarily be attractive given the upward momentum over the last 2-months.

Motherson Sumi is one stock that brokerages are bullish on. Emkay Global believes that the stock can rise 37% from the current levels of Rs 236 to a price of Rs 325.

According to Emkay Global revenues of the company are likely to witness growth at +5% on a CAGR basis. “On quarter-to-quarter basis, revenues should increase by 5% due to growth in automobile production in Europe and US PV segments. EBITDA margin should expand to 10.3% from 6.8% in Q1FY20,” Emkay Global has said.

According to the brokerage, the margin is likely to expand by 10 basis points qoq due to higher scale.

Hero MotoCorp stock remains overvalued

Hero MotoCorp stock remains overvalued

HeroMoto Corp is another stock that could have made an interesting pick, had the stock been lower from the current levels. The shares have moved-up steadily over the last 6-9 months and the price is no longer attractive. Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services, says that 2 wheeler will recover slower, which means investors will need patience in stocks like HeroMoto Corp.

In fact, the entire sector is trading at a premium, which makes stocks from the sector unattractive. “On a P/B basis, the sector is trading at a 5% premium over its 10-year average of 3 times,” Bulls & Bears India Valuation Handbook, Motilal Oswal Financial Services.

In short, the sector is over valued, not many shares are available at a discount and those that are, do not look too attractive. Motherson Sumi Systems a global auto ancillary player may still have some steam left in the stock.

Disclaimer

Disclaimer

Investors should not take any trading and investment decision based only on information discussed on GoodReturns.in We are not a qualified financial advisor and any information herein is not investment advice. It is informational in nature. All readers and investors should note that neither Greynium nor the author of the articles, would be responsible for any decision taken based on these articles. Please do consult a professional advisor.

The above article is sourced from different broking reports. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and authors do not accept culpability for losses and/or damages arising based on information in GoodReturns.in



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Buy This Banking Stock For 40% Returns, Says Motilal Oswal & Emkay Global

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Almost all brokerages have a “buy” call on the stock of SBI

Current market price Recommendation Target price
HSBC Rs 435 Buy Rs 530
Emkay Same as above Buy Rs 600
HDFC Sec Same as above Buy Rs 501
Motilal Oswal Same as above Buy Rs 600
CLSA Same as above Buy Rs 650

Apart from this, there are several other brokerages that have a buy on the stock including the likes of Kotak Institutional Equities. At the current market price of Rs 435, the stock can move at least 40% higher, if we average the broker targets.

Buy the State Bank of India stock says Emkay Global for target of Rs 600

Buy the State Bank of India stock says Emkay Global for target of Rs 600

While we do not want to go into details of the stock provided by each and every broker, let’s get into what broking firm Emkay Global has to say. According to the brokerage, the first quarter FY 2022, operating performance beat estimates on healthy fees/treasury gains, but high provisions led to a 5% miss on net profits at Rs 65 billion (estimates Rs 68.4 billion). Asset quality performance was mixed, with gross non performing assets up 34 basis points, quarter on quarter to 5.3% (led by retail/SME), restructured pool rising moderately to 0.8% of loans (pipeline at 0.1%) and SMA pool flat qoq at 0.5%

The firm has retained buy on the stock with an overweight stance and a target price of Rs 600, valuing core bank at 1.4x Sep’23E ABV and subs/investments at Rs185, leading to a near 40% upside from the current levels.

“State Bank of India is the second best pick after ICICI Bank, and we believe that better-than-expected growth/asset quality movement could provide further upsides to earnings/valuations,” the brokerage has said.

Broking firm, Motilal Oswal too has a buy call on the stock. quarter. “We estimate State Bank of India to deliver FY22/FY23 Return on Equity of 13.1% and 14.6%, even as we build in credit cost of 1.6% and 1.3% for FY22E/FY23E. Maintain buy, with revised price target of Rs 600,” Motilal Oswal has said.

Disclaimer

Disclaimer

Investors should not take any trading and investment decision based only on information discussed on GoodReturns.in We are not a qualified financial advisor and any information herein is not investment advice. It is informational in nature. All readers and investors should note that neither Greynium nor the author of the articles, would be responsible for any decision taken based on these articles. Please do consult a professional advisor.

The above article is sourced from different broking reports. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and authors do not accept culpability for losses and/or damages arising based on information in GoodReturns.in



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List Of Upcoming Bonus Issues In 2021

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Illustration to understand bonus share issuance:

Say a company ‘X’ announces 4:1 bonus and the investor holds 200 equity shares of that company ‘X, then for every 1 share, the investor shall be entitled to receive 4 additional shares for free. So, his ownership in the company would increase as following 800 bonus shares and 200 original shares that he owned, making the total to 1000 shares.

Why do companies issue bonus shares?

Why do companies issue bonus shares?

Companies come up with bonus share issuance to attract more of retail participation as well as to increase their equity base. When bonus shares are issued, outstanding shares in the market increase, which results in the decrease in the price per share of the company issuing bonus shares.

To know how the issuing company and investors benefit from bonus share issue read here.

Prerequisite for bonus share issuance

Prerequisite for bonus share issuance

– The bonus share issuance needs to be approved by the Articles of Association. In a case when the Articles of Association is unable to sanction the same, the company needs to pass a special resolution act at their general meeting. Note in the case of a general meeting, the bonus share issuance need to be approved by the shareholders also.

– Also, the company needs to see that the total share capital does not becomes higher than the authorized share capital due to the bonus issue. And if at all it happens, the Memorandum of Association’s capital clause needs to be modified by augmenting the authorized capital.

All in all the Sebi guidelines on the bonus share issuance need to be adhered to.

Bonus share issuance: Understanding record date, ex-bonus date

Bonus share issuance: Understanding record date, ex-bonus date

The company that announces bonus share issuance also reveals the ‘record date’. So, what is the record date?

Record date is a cut-off date decided by the company for determining shareholders who will be eligible for the bonus shares. Basically, those shareholders who own the company’s scrip as on the cut-off date are entitled to receive bonus shares.

Ex-bonus date: After the company declares the bonus but before the record date, the shares of the bonus issuing company are referred as ‘Cum bonus’. Besides, there is an ex-date which is set one business day before the record date. Importantly, in India we adhere to the T+2 rolling system for share delivery.

Determining the eligibility for bonus shares

Now to be eligible for receiving bonus shares, you need to buy shares before the ex-date as in a case when you happen to purchase the shares of the company that has announced bonus shares on the ex-date, the same shall not be credited into your account on the record date and hence you will not be entitled for the bonus shares.

How bonus shares get credited to the eligible shareholder’s account?

How bonus shares get credited to the eligible shareholder’s account?

As soon as the new ISIN or International Securities Identification Number is allotted to the bonus shares, the bonus shares get credited to eligible shareholders’ account within a period of 15 days.

List of companies turning ex-bonus soon

Company Bonus Ratio Bonus announcement date Record date Ex-bonus date
Kshitij Polylin 1:6 8.7.2021 17.8.2021 13.8.2021
Sun Retail 3:5 30.6.2021 17.8.2021 13.8.2021
Redington 1:1 07.07.2021 20.8.2021 18.8.2021
Swasti Vinayaka 2:7 29.06.2021 24.8.2021 23.8.2021
Rajnandini Metal 1:2 26.07.2021 03.09.2021 02.09.2021
KSolves India 1:1 27.07.2021 07.09.2021 06.09.2021

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7 Points To Note Such That Your IPO Application Is Not Rejected

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Planning

oi-Roshni Agarwal

|

At a time when primary market is buzzing with IPO offers and we are witnessing that the market is being tapped by around 1-2 new companies every week and the splendid listing is providing a reason to cheer to the successful allottees. So, the IPO applicant while applying for IPO as offered by the new company should be aware of the following points so that their application is not rejected on any ground such as incomplete or duplicate applications being submitted by the applicant.

7 Points To Note Such That Your IPO Application Is Not Rejected

7 Points To Note Such That Your IPO Application Is Not Rejected

Never apply more than one application: Say in a case if you maintain 2 or more demat accounts with different brokerages and you make multiple applications for one IPO, being the same applicant, then the bid shall be considered invalid and you will not secure the IPO shares.

PAN linked to the Bank should be same as IPO Applicant PAN: Since the Banker has key role in refunding the IPO Application money at the time of rejection of Application the Applicant should make payment or block payment (ASBA Process) from the same PAN linked bank account for each IPO Applicantion PAN otherwise it shall be rejected.

For HNI Application’s never select Cut Off Price: The HNI Investor who agrees to invest more than 2 Lacs Rs in the newly listed IPO shall not checkbox the Cut off Price option as the HNI Investor is allotted shares at Upper Price of the Price Band as indicated in the Prospectus. Cut off price is the

For Retail Institutional Investor Application’s always select Cut Off Price: The Retail Institutional Investor who can invest upto Rs 2 Lacs in each IPO should select Cut off Price while submission of IPO Application form. The cut off price is the offer price at which the company is ready to allot its shares to its applicant shareholders.

For Retail Institutional Investor Application’s applying under shareholder’s quota: The Retail Institutional Investor who can invest upto Rs 2 Lacs in each IPO should select and apply for shares under the shareholder’s quota which is being provided by the parent company if any as informed in the prospectus. However, such shareholder’s shall consider the record date for holding of such parent companies such to become eligible for applying in this quota.

Demat Account should be Active: The investor should clearly watch out while filing IPO Application forms its Demat details should be correctly filled up and the demat account should be active and not be dormant.

IPO Application’s is being accepted beyond time limits: Many offline modes accept the IPO Application till last minute to raise the subscription numbers where these last minute rushed up IPO Applications are outrightly rejected and not considered in the lottery system of allotment.

GoodReturns.in

Story first published: Saturday, August 7, 2021, 23:21 [IST]



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How green rulings can put you in the red

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Receiving environmental clearance (EC) for a residential project is often seen as a routine formality. But recent judgements by the National Green Tribunal (NGT) have hung a huge question mark over this assumption. The Tribunal had, in the last nearly 18 months, revoked ECs granted, imposed hefty penalties and even ordered the demolition of construction completely.

Hence, it is high time for home buyers to understand why EC has come under the spotlight, so that you can potentially weigh and mitigate such risks in your purchases.

Key rulings

While there are a few interesting rulings, the recent high profile one is that of Godrej Reflections, a high-rise residential project in Varthur, Bengaluru. The project had received EC on January 10, 2018 and was registered with RERA in March 2018. Bookings were opened to home buyers after that. But based on a petition filed, challenging the EC, the NGT cancelled the clearance in February 2020 – stating that there was construction in the buffer zone of a lake, which would be in violation of zoning plan.

The ruling was challenged in the Supreme Court and in August 2020, it was ruled that the NGT would reconsider the decision, but that no construction shall happen until the issue is resolved. Based on additional inspection reports submitted to the NGT, it ruled in July 2021 that the project was in violation. The constructions made on the site was ordered to be demolished and the habitat restored. Besides fine for the builder, it also imposed a fine of ₹10 lakh on Bruhat Bengaluru Mahanagara Palike (BBMP) for illegally allowing alterations of the storm water drain passing through the project site.

The order also noted that construction had commenced even before grant of consent to establish (CTE) by Karnataka State Pollution Control Board (KSPCB) and in violation of conditions of EC. It added that the committee which made inspections and submitted the report was not the one constituted by it and the Environment Ministry.

Buyers beware

Why are the facts of this case important? The import of the judgement, particularly as it involves a reputed builder, can be huge for those who purchase under-construction homes.

For one, while issues with violating green norms are not new, the impact has lately been tougher on the buyers. While this is a welcome move – as compliance is better enforced -, it is a big shift from the past where the rulings often only required payment of a fine by the builder. For example, in the case of Sushant Lok project in Gurugram, the builder was asked to pay a fine for flouting various norms. Likewise, Goel Ganga Developers based in Pune was asked to pay a fine of INR 195 crores in 2018 for multiple issues. Now, given that more is at stake, buyers can avoid projects in environmentally sensitive zones, advises Vijay Kumar, Advocate, who specializes in RERA related cases.

Two, this is the not an isolated case of EC being revoked by the NGT. In January 2020, the NGT had stopped work on a project by Young Builders in Delhi. This was based on questions raised on the validity of the EC – that it could only be granted by the Ministry of Environment and Forests and not by SEIAA – as the project is within 10 km from a Critically Polluted Area. Likewise, Falcon View, a residential project in Mohali, was asked to stop construction by the NGT as the EC it had obtained for a mixed-use development did not cover the housing project.

Given the repeated history of EC being inadequate, buyers must inspect this aspect closely – get advice from environmental lawyers to ensure the validity of the clearance and any possibilities of it being challenged. “Check land usage restrictions and land conversion approvals. Be sure to also inspect the city master plan to understand the nature of projects approved in that land/area”, advises Vijay Kumar.

Three, the process seems to be a roller-coaster ride with long delays. For example, in both the Delhi and Bengaluru cases, the builder challenged the order in the apex court, which set aside the order and required the NGT to consider reports from a new committee. However, the NGT had, after some delay in getting the report, stood by its decision to revoke the EC. In the case of Godrej Reflections, the first NGT order was made nearly two years from the start of customer bookings and the second order was after more than 3 years. If you do book early, make sure you check the clauses in the agreement that relate to exiting and be open to exercise it if there are early roadblocks such as lawsuits filed.

Four, despite the comfort provided by RERA, there is no assurance of completion for a project. And prerequisites for getting RERA, including the EC, may be revoked, adding to the risk. The implication is that RERA must not be seen as a guarantee and the truly safe option is to buy completed projects – preferably those with Occupancy Certificates. The OC is proof that the project meets the applicable building codes, regulations and laws, thereby avoiding completion and various legal risks.

The author is an independent financial consultant

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All you wanted to know about reporting capital gains in ITR forms

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Reporting capital gains in income tax returns (ITR) is undoubtedly becoming tedious for taxpayers. With the taxman aiming to leave no stone unturned, the disclosures in the ITR forms have only increased in the last few years.

Here, we simplify the reporting requirements of short term capital gains (STCG) and long-term capital gains (LTCG) under Capital Gains Schedule in the ITR forms.

Property, equity disclosures

After many tweaks over the last few years, there is thankfully no significant change to the current ITR forms (applicable for FY21). The only change is in the case of immovable property.

Here the difference between the transaction value and the circle rate is now altered to 10 per cent, from the previous level of 5 per cent, to be in line with the amendments in the tax law proposed in the Budget of 2020.

In case of STCG/LTCG on the sale of immovable property, it is mandatory to disclose the details such as consideration, stamp value, cost of acquisition of the property and name and PAN/Aadhaar number of the buyer etc.

These details should be furnished separately for each immovable property transferred during the year. If you have sold land and building, quoting the PAN of buyer is mandatory only if tax is deducted under section 194-IA or is mentioned in the documents.

For sale of listed equity shares or equity-oriented mutual fund units, while STCG on sale can be reported on a consolidated basis, scrip-wise details for long-term capital gains (for which LTCG tax at 10 per cent was introduced in Budget 2018 for sale exceeding ₹1 lakh) for certain transactions have to be reported under Schedule 112A.

However, the Central Board of Direct Taxes (CBDT), vide a press release dated 26.09.2020, clarified that scrip-wise reporting in the ITR was required only for those shares/units eligible for the benefit of grandfathering.

The grandfathering clause exempts tax on LTCG on listed equity shares up to January 31, 2018 for those securities bought before that date.

The ITR form has introduced a drop-down feature in Schedule 112A wherein the taxpayer can select if the share/ unit was acquired “on or before” or “after 31.01.2018”.

For the listed shares/units acquired after 31.01.2018, the consolidated amount of sale consideration and cost of acquisition alone should be reported. For others, the fields requiring details of “ISIN code” and “name of share/ unit” scrip-wise has to be reported.

Amounts reinvested in certain specified forms such as residential house property, agricultural land or tax free bonds – which comes under Section 54 – can be claimed as deduction from capital gains. The details of such claims have to be furnished as per part D of the Schedule CG. Information such as cost of new residential house/agricultural land and amount invested in specified/notified bonds and date of these transactions are to be reported.

Further, part E of the Schedule CG provides for set-off of current year capital losses with current year capital gains. The schedule is mostly auto-filled but note that the long-term capital loss can only be adjusted with any long-term capital gains only. While short-term capital losses are allowed to be set-off against both long-term and short-term gains.

Also, part F of the Schedule requires reporting of quarter-wise details of incomes under the head ‘capital gains’, details of which is taken for calculation of advance tax liability and interest under 234C. Thus, capital gains accrual or receipt have to be reported on a quarterly basis.

Other schedules

While most of the Schedule CG requires entering the details, other schedules relevant to reporting of capital gains mostly require just confirmation as most of the details would have been auto-populated.

The capital gains in a financial year, remaining after intra head set off (as discussed above), will be reflected in Schedule CYLA, where set-off against current year losses under various heads of income takes place.

Here, losses under any other head can be set off with income under the capital gain head.

Subsequently, the income remaining after set off of current year losses, as per Schedule CYLA will be shown in Schedule BFLA, where set off of brought forward losses of earlier years takes place.

The brought forward losses under this schedule will be picked from Schedule CFL of the ITR form, in which brought forward losses details are to be manually entered. Note that brought forward short-term capital loss can be set off against any STCG or LTCG. However, brought forward long-term capital loss can only be set off against an LTCG.

In case of capital loss instead of capital gain, the remaining capital loss after above adjustments will be taken to Schedule CFL for losses to be carried forward to future years – that is, next eight assessment years from the assessment year in which the loss was incurred.

Mode of filing

Individuals having capital gains shall report the income in ITR 2/ITTR 3 form for FY21. ITR 3 is required when an individual has income from business or profession in addition to capital gains income.

The CBDT has launched a new offline utility called JASON for the assessment year 2021-22. The existing excel and java utility have been discontinued. The new JSON utility has currently been enabled for ITR 1 to 4.

The utility will import and pre-fill the data from e-filing portal to an extent possible, while the key transactional data has to be keyed in. Once the JSON file is created, it that has to be uploaded to the new income tax e-filing portal, which is yet to be fully functional.

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Why Bajaj Finance FDs are a safe option

Personal Finance

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If you are a fixed income investor in search of higher rates, and are comfortable going beyond bank fixed deposits, then NBFC deposits are an option you can consider.

Many NBFCs (non-banking financial companies) are offering higher rates than most private and public sector banks on fixed deposits of comparable tenures, of course, for the higher risk they entail.

However, unlike bank deposits that are insured for an amount up to ₹5 lakh by the Deposit Insurance and Credit Guarantee Corporation, NBFC deposits enjoy no such protection.

It therefore, makes sense to restrict yourself only to the deposits of NBFCs with strong financials.

Today, interest rates are at near bottom and are expected to go up, though not anytime soon.

The RBI left the repo rate unchanged yet again in the latest monetary policy review on August 6, 2021.

Two-year fixed deposits, that offer better rates than lower tenure deposits without locking-in your money for too long, can therefore, be a good choice.

What’s on offer

Bajaj Finance offers 6.10 per cent per annum on its two-year cumulative FD and non-cumulative FD (with an annual interest pay-out option). This is better than the 5.1 – 5.2 per cent and 5.0 – 5.5 per cent respectively offered by several public and private sector banks.

The Bajaj Finance FD rates are a tad lower than those offered by other NBFCs such as Mahindra & Mahindra Financial Services (6.2 per cent) and Shriram Transport Finance (6.54 per cent) on their similar deposits.

But Bajaj Finance’s strong financials, among the best in the sector, offer ample comfort to investors.

The deposits enjoy the highest ratings — CRISIL’s FAAA/Stable and ICRA’s MAAA (stable).

Senior citizens, that is, those aged 60 or above get an additional 0.25 per cent on the Bajaj Finance FD. Those booking an online FD get an additional 0.10 per cent. This does not apply to senior citizens. You must invest a minimum of ₹25,000 in the FD.

Strong financials

Bajaj Finance has a well-diversified loan book spread across consumer, rural, SME and commercial loans.

As of June-end 2021, consumer loans accounted for 44 per cent of the lender’s loan book of ₹1.6 lakh crore. With a presence in over 3,100 locations, the non-bank lender is geographically well-diversified too. The loan book registered a year-on-year growth of 15 per cent growth in the June 2021 quarter.

Adequate buffer

As of June-end 2021, Bajaj Finance’s net NPAs (non-performing assets) were only 1.46 per cent.

While this is higher than the 0.5 per cent in the June 2020 quarter, the previous year’s numbers are not comparable due to the then ongoing moratorium.

Also, Bajaj Finance’s capital to risk weighted assets ratio (CRAR) of 28.57 per cent is well above the mandated 15 per cent, providing adequate buffer against any future bad loans.

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