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Banks move to invoke personal guarantees, promoters of 17 defaulting firms may lose their wealth, BFSI News, ET BFSI

Banking & Finance

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Banks have approached the National Company Law Tribunal for invoking personal guarantees of promoters of 17 defaulting companies.

The defaulting promoters include those of Punj Lloyd, Amtek Auto, ABG Shipyard, Videocon, Varun Shipping, and Lanco, according to reports.

Armed with a Supreme Court order, banks are looking to invoke personal guarantees of tycoons from Venugopal Dhoot to Kapil Wadhawan to recover unpaid loans from their delinquent firms

The guaranteed debt

According to an estimate, the top 10 personal guarantors have guaranteed debt of over Rs 1.6 lakh crore. Among the big names, former promoters of Bhushan Steel and Power Sanjay Singhal and his wife Aarti Singhal had furnished personal guarantees worth up to Rs 24,550 crore to take loans from a consortium of bank led by State Bank of India (SBI).

The former promoter of Reliance Communications, Anil Ambani, has also given a personal guarantee against the loan taken. Erstwhile promoter Wadhawan stands guarantee to loans taken by DHFL, which is sitting on debt of about Rs 90,000 crore, while Dhoot has also given a personal guarantee to a portion of Rs 22,000 crore loan to Videocon.

The SC order

The Supreme Court in May had held that the November 15, 2019 government notification allowing creditors, usually financial institutions and banks, to move against personal guarantors under the Insolvency and Bankruptcy Code (IBC) was ‘legal and valid’.

Post the judgement, a senior official of a public sector bank said banks are assessing the level of involvement of those directors who pledged their personal guarantee against the loan.

Banks have started receiving calls from some of the promoters for the exclusion of their personal guarantee from the non-performing assets. Some of them are coming forward to resolve bad loans to save their personal wealth.

Most of the promoters thought that once their case is admitted under IBC, their past obligations cease.

However, the order has generated fear among the promoters and directors who pledged their personal guarantee of losing their personal wealth as part of the resolution process.

The personal guarantees are likely to expedite the resolution process as the guarantor stands the risk of losing personal property.


The hurdle

Many of these promoters are being investigated for fraud and their assets are already attached by the investigative agencies. Getting these assets released from the law agencies will take time.

SBI action

SBI was one of the respondents to the 74 petitions and challenges by promoters on invocation of personal guarantees. It has been in the forefront of invoking guarantees of promoters of defaulting companies. It had invoked Rs 1200 crore of guarantees given by Ambani for defaulting companies Reliance Communications and Reliance Infratel.

SBI had also approached the Mumbai bench of the NCLT to initiate guarantees by the Videocon Indsutries‘ Dhoot brothers totalling Rs 11,500 crore.

It had also taken Bhushan Power & Steel promoter Sanjay Singal to court to recover Rs 12,276 crore dues to the bank for which he was a guarantor. All these promoters had challenged these actions in court.



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List Of Companies Issuing Bonus Shares in India 2021

Personal Finance

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Why do companies issue Bonus Shares?

When the price of a share is high, retail investors find it difficult to buy shares in a company. When the number of shares issued increases, the price decreases, making the stock more accessible to regular investors. The number of outstanding shares is increased by issuing Bonus Shares. As a result, traders are more likely to participate, increasing the liquidity of the stock.

Rewarding investors for their trust and devotion to the company, which also serves to improve investor sentiment.

Bonus shares are issued by a corporation in order to boost the stock’s liquidity and investor engagement. After a bonus issuance, the stock price lowers to a fair range, allowing investors to buy more shares.

Finally, increasing the dividend payout per share would add value to the investment.

Existing shareholders receive additional shares in a particular percentage in a bonus issue. If a 4:1 bonus issue is announced, for example, owners will receive four shares for every one they own. So, if an investor owns 10 shares of a corporation, he or she will receive a total of 40 (4*10) shares.

Who is eligible for Bonus Share? Know About Record Date, Ex-Date

Who is eligible for Bonus Share? Know About Record Date, Ex-Date

Bonus shares are available to shareholders who own the firm’s stock prior to the record date and the ex-date determined by the company. For the delivery of shares in India, the T+2 rolling system is used, in which the ex-date is two days before the record date. Bonus share eligibility is determined by the shareholders’ record date and ex-date.

The record date is a cut-off date defined by the company, and to be eligible for the bonus share issue, investors must be shareholders of the company before this date. Furthermore, the ex-date is one day before the company’s record date.

The delivery of shares into a Demat account in India takes two days after the trading date. Existing shareholders are eligible to receive bonus shares issued by a corporation before the ex-date and record date. To be eligible for bonus shares, however, the company’s stock must be purchased before the ex-date. Bonus shares are credited to owners’ accounts within fifteen days once a new ISIN (International Securities Identification Number) is assigned to the bonus shares.

Advantages And Disadvantages Of Bonus Shares

Advantages And Disadvantages Of Bonus Shares

Advantages Bonus Shares

  • When the investor receives the bonus shares, he or she is not required to pay any taxes.
  • It is especially advantageous for investors that believe in the company’s long-term story and wish to increase their investment in it.
  • The issuance of new shares and the use of cash for the company’s business expansion boosts investor confidence in the company’s operations.
  • Because he owns a large number of shares in the firm due to the company’s previous policy of paying a stock dividend, if the company resumes paying a cash dividend in the future, the investor will receive more.
  • Business and operations by demonstrating that the faith with which the investor invested in the firm is still intact and that the company is putting that cash to good use and rewarding the investor for it.

Disadvantages

Bonus shares increase the number of shares in circulation, changing the Earnings Per Share (EPS). After the bonus shares are issued, the share’s EPS decreases because the net profit remains the same and the number of shares is larger.

List Of Companies Issuing Bonus Shares in India 2021

List Of Companies Issuing Bonus Shares in India 2021

Company name Proportion Record date Ex-date
Redington 1:1 20-Aug-2021 18-Aug-2021
Dhunseri Tea 1:2 06-Aug-2021 05-Aug-2021
Maan Aluminium 1:1 03-Aug-2021 02-Aug-2021
Tide Water Oil Co(I) 1:1 27-Jul-2021 26-Jul-2021
Tiaan Consumer 59:100 22-Jul-2021 20-Jul-2021
Sadhana Nitro Chem 2:5 21-Jul-2021 19-Jul-2021
GRM Overseas 2:1 16-Jul-2021 15-Jul-2021



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Reserve Bank of India – Tenders

Tenders

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The Department of Communication, Reserve Bank of India, Central office, Mumbai invites proposals for Empanelment of media buying/advertising agency/ies. Interested advertising agencies may submit proposals to Department of Communication, Reserve Bank of India for or media buying, as per their eligibility, by 3.00 pm on or before August 2, 2021.

The tender documents along with all relevant details, for submission of proposals are available under “Tenders” section on the Reserve Bank’s website (www.rbi.org.in).

Any further addenda/corrigendum/extension of dates, clarifications/ responses to bidders’ queries in respect of the above tenders shall be posted on the Reserve Bank’s website (www.rbi.org.in) only.

Chief General Manager

Place: Mumbai
Date: July 13, 2021

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Sovereign Gold Bond: Here’s What SBI & PNB Have On Offer

Personal Finance

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Investment

oi-Vipul Das

|

The fourth batch of the Sovereign Gold Bond Scheme 2021-22 – Series IV will be available for sale from July 12 to 16, 2021. According to the Reserve Bank of India, the issue price for the Sovereign Gold Bond Scheme 2021-22 has been set at Rs 4,807 per gram. According to the press release notice of RBI, “The nominal value of the bond based on the simple average closing price for gold of 999 purity of the last three business days of the week preceding the subscription period…works out to Rs 4,777 per gram of gold.”

Key things you need to know about Sovereign Gold Bond Scheme 2021-22 - Series IV

Key things you need to know about Sovereign Gold Bond Scheme 2021-22 – Series IV

  • In collaboration with the RBI, the Centre has agreed to provide a concession of Rs 50 per gram less than the actual value to investors who register online and pay for the registration using digital means. The issuance price of the Gold Bond would be Rs 4,757 per gram of gold for such investors.
  • The Sovereign Gold Bond Scheme 2021-22 – Series IV will close for subscription on July 16, 2021.
  • Subscribers can purchase for a minimum of 1 gram of gold for Rs 4,807, compared to the Rs 4,889/gm issue price for Series III, which was available for subscription from May 31 to June 4, 2021.
  • The bonds will be issued through banks, with the exception of small finance banks and payment banks, Stock Holding Corporation of India Limited (SHCIL), authorised post offices and authorized stock exchanges, namely the National Stock Exchange of India Limited and the Bombay Stock Exchange (BSE).
  • The centre has planned to release the bonds in six tranches from May 2021 through September of the current year. The bonds will be issued by the Reserve Bank of India on behalf of the Government of India, according to the press release.
  • Since its commencement, the SGB Scheme has accumulated a total of Rs 25,702 crore through the end of March 2021.
  • During 2020-21, the RBI released 12 tranches of SGB for a total of Rs 16,049 crore (32.35 tonnes), according to the press report.
  • The nominal value of the bond is based on the simple average closing price [published by the India Bullion and Jewellers Association Ltd (IBJA)] for gold of 999 purity of the last three business days of the week preceding the subscription period, according to RBI.
  • According to the press release of RBI, the bonds will be denominated in multiples of gram(s) of gold with a basic unit of 1 gram. The tenor of the Bond will be for a period of 8 years with exit option after 5th year to be exercised on the next interest payment dates.
  • According to the press release of RBI, the minimum permissible investment will be 1 gram of gold. And the maximum limit of subscription shall be 4 KG for individual, 4 Kg for HUF and 20 Kg for trusts and similar entities per fiscal (April-March) notified by the Government from time to time. A self-declaration to this effect will be obtained. The annual ceiling will include bonds subscribed under different tranches during initial issuance by the Government and those purchased from the Secondary Market.
  • According to the press release of RBI, know-your-customer (KYC) norms will be the same as that for purchase of physical gold. KYC documents such as Voter ID, Aadhaar card/PAN or TAN /Passport will be required.

6 Reasons You Must Invest In Sovereign Gold Bonds According to SBI

6 Reasons You Must Invest In Sovereign Gold Bonds According to SBI

The largest Indian commercial bank outlined six compelling reasons to invest in the fourth tranche of the Sovereign Gold Bond Scheme. A tweet from SBI cited the six reasons to acquire Sovereign Gold Bonds. According to SBI, “Planning to invest in Gold?

Here are 6 golden reasons to invest in Sovereign Gold Bonds. SBI customers can invest in these bonds on http://onlinesbi.com under e-services. Know more: https://bit.ly/2O8ESdv.”

  • Assured returns of 2.50% p.a. Payable half-yearly.
  • No capital gain tax on redemption.
  • Can be used as collaterals for loans.
  • Secure, no storage hassles like physical gold.
  • Liquidity: Tradable on exchanges.
  • No GST and making charges unlike in physical gold.
  • Issue price: 12th – 16th July, 2021.
  • Offer: Special discount of Rs 50/gm on applying online.

Sovereign Gold Bond Offer By Punjab National Bank

Sovereign Gold Bond Offer By Punjab National Bank

The Punjab National Bank has also cited via its Twitter handle “Perks of applying online: Get discount of Rs 50/gram! Subscription opens tomorrow.” The bank has also cited three reasons to invest in which are:

  • Minimum investment 1 gram.
  • Maximum investment 4kg.
  • Price Rs 4,807 per gram.
  • Subscription is open from 12th July to 16th July, 2021.
  • To apply for a Sovereign Gold Bond, PNB customers can call at toll-free numbers 1-800-180-2222 or 1-800-103-2222.

Story first published: Tuesday, July 13, 2021, 16:35 [IST]



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Over $10 billion of IPO fund-raise expected this fiscal, says Kotak honcho V Jayasankar

Banking & Finance

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It’s raining IPOs in the market and pipeline for the remainder of the year is only robust. By all counts, this fiscal should see IPO fund-raise of at least $10 billion (without including mega LIC IPO) if the current trend is anything to go by, says V Jayasankar, Senior Executive Director and Head-ECM, Kotak Mahindra Capital Company (KMCC). He would know better with KMCC having managed the top three (₹10,200 crore) of the total six IPOs (₹12,423 crore) that hit market in April-June 2021. July itself is going to see IPOs worth ₹24,000 crore. Edited excerpts:

What explains this IPO rush? Is there a good pipeline and will this momentum continue?

Last fiscal was a record year for Equity Capital Market (ECM) business. Overall, ₹2.45-lakh crore was raised and about ₹25,000-30,000 crore was initial public offering (IPO) business in the country. IPO was about 15 per cent of ECM activity which was very robust.

I expect this year to be a record one for IPO market and my estimate is that in excess of $10 billion (without including the mega LIC IPO) will be raised. Even if the overall ECM activity remains similar to last year, there would be better proportion of IPOs in the equity raise.

So what is creating this shift?

There are five sectoral themes playing out in the market though the investor appetite stretched beyond them. These are the new age or consumer tech start-ups, financial services, speciality chemicals, consumer and healthcare sectors. The Indian start-up system has matured and become very robust. We see good number of listings in the coming years.

Can you elaborate on the other four trends?

We expect to see large number of well-managed companies in the financial services space to tap the market for listing across the spectrum of lending, insurance and others. A number of speciality chemical companies will continue going public as they have the scale and become more export-oriented. Also, benefiting from China plus one strategy. Similarly, there are numerous consumer and healthcare companies that we expect to go public as the addressable market has been growing.

Do you think Internet-based tech companies can garner better valuation by listing in overseas market like the US?

Indian equity markets have matured over the years and have depth of institutional investors’ participation. Investor universe is similar for well-run and well-managed tech companies, whether you list in India or abroad. You have the added advantage of Indian MFs and insurance companies participating in India listing.

The valuation peers, benchmark and methodology are similar irrespective of listing destination. Often we see institutional investors pay better value for Indian companies factoring in higher growth prospects that India may provide. You are likely to see several Indian digital and new age companies list here in the coming years reflecting the strong appetite.

Importantly, consumer brands benefit from retail participation. A successful listing can enhance the power and visibility of a brand.

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Reserve Bank of India – Press Releases

Press Releases

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April 14, 2015




Dear All




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.



Thank you for your continued support.




Department of Communication

Reserve Bank of India


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2 ‘Buy’ Calls By ICICI Direct For Quick Gains In Near Term

Personal Finance

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1. Accelya India Solution India:

ICICI Direct in its brokerage report on July 12 recommended a buy for this mid cap IT stock at a price of Rs. 1430 for a target of Rs. 1660 per share, implying an upside of over 16%. The stop loss suggested for the trade is Rs. 1250. Last the stock at the time of writing this copy traded at a price of Rs. 1460.8.

Accelya is a leading provider of technology solutions to travel and transport sectors. The company leverages the power of technology, data and industry expertise to propel your organization forward.

Strong volume support will help the IT midcap to outperform and sustain upward price trend

The IT space has been key outperforming sector over a year now. Within this space Accelya Solution has been underperformer in midcap space. In the current month the stock has resolved out of 3 year long bullish reversal bottom formation, indicating turnaround and makes us believe that stock will catch up and outperform in coming months, said the brokerage firm in its report.

We expect the stock to head towards target of Rs. 1660 being 80% retracement of entire 2017 to 2019 decline( Rs. 1890-701). Structurally, after 3 years of consolidation the stock has witnessed breakout with significant volume expansion, signalling a bullish turnaround in price structure and longevity of uptrend.

Note the duration targeted for the target price is 3 months.

2. UltraTech Cement:

2. UltraTech Cement:

The buy has been recommended for this Aditya Birla Group cement company at a price of Rs. 6875 for a target of Rs. 7770, i.e. a 13% upside. The company has advised a stop loss of Rs.6318.

Infra push amid recovery is giving impetus to cement stocks too

Amid economic rebound, stocks from infrastructure space are doing very well and cement stocks are no exception. The brokerage firm in its report said “select stocks from the infrastructure sector may witness renewed momentum amid a sustained broader market recovery. Cement stocks like UltraTech Cement are likely to perform better in the coming trading sessions along with the ongoing recovery in sectoral peers like Ambuja Cement and ACC”.

Since May 2021, UltraTech has taken support near Rs. 6600-6700 levels on multiple instances. Also, looking at the significant delivery volume activity in May 2021 and then in mid-June 2021, these levels seem very crucial. In such a scenario, the positive bias may continue in the stock till these levels are held.

The stock in a year’s time has yielded return to the tune of 87.8% while Sensex during the same time has provided absolute return of 43.62%. In today’s trade (July 13, 2021), the stock has hit 52-week high price of Rs. 7160 per share on the NSE and is up for the third consecutive day today.

Disclaimer:

Disclaimer:

The above mentioned Stock buy calls are taken from the brokerage report of ICICI Direct. Neither the author, the brokerage nor Greynium Information Technologies would be responsible for losses incurred based on the article. Please consult a professional advisor. Investing in stock markets is risky.

GoodReturns.in



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Reserve Bank of India – Press Releases

Press Releases

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Sr. No. State/ UT Notified Amount
(₹ Cr)		 Amount Accepted
(₹ Cr)		 Cut off Price (₹) / Yield
(%)		 Tenure
(Yrs)
1 Andhra Pradesh 1000 1000 7.12 14
750 750 7.14 15
2 Bihar 2000 2000 6.82 7
3 Goa 100 100 6.99 10
4 Gujarat 1500 2000 6.95 10
5 Madhya Pradesh 2000 2000 7.00 10
6 Maharashtra 1000 1250 6.95 10
7 Rajasthan 500 500 6.29 5
600 600 7.00 10
8 Tamil Nadu 1000 1000 6.98 10
1000 1000 99.74/6.9863 Re-issue of 6.95% Tamil Nadu SDL 2031 issued on July 07, 2021
9 Telangana 2000 2000 7.24 30
10 Uttarakhand 500 500 7.00 10
11 Uttar Pradesh 2500 2500 6.99 10
12 West Bengal 1500 1500 7.02 10
  TOTAL 17,950 18,700    
* Gujarat has accepted an additional amount of ₹ 500 crore in the 10 year security.
** Maharashtra has accepted an additional amount of ₹ 250 crore in the 10 year security.

Ajit Prasad
Director   

Press Release: 2021-2022/521

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Bhutan becomes first country to adopt UPI standards for its QR deployment, BFSI News, ET BFSI

Banking & Finance

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BHIM UPI has forayed in Bhutan in collaboration with Royal Monetary Authority of Bhutan.

The service will be launched by India’s Finance Minister, Nirmala Sitharaman, Bhutan’s Finance Minister, Lyonpo Namgay Tshering, Governor of Royal Monetary Authority of Bhutan, Dasho Penjore, Secretary (Department of Financial Services) Shri Debasish Panda, Ambassador of Bhutan to India General V Namgyel, Ambassador of India to Bhutan, Ruchira Kamboj, MD & CEO of NPCI, Dilip Asbe.

NPCI’s international arm, NPCI International Payments Limited (NIPL) and Royal Monetary Authority of Bhutan (RMA) collaboration will help enable UPI acceptance powered by BHIM App in Bhutan.

NIPL said, “UPI QR transactions are accepted at all RMA acquired merchants in Bhutan. The launch will benefit more than 200,000 tourists from India who travel to Bhutan each year. With this launch, Bhutan will become the first country to adopt Unified Payment Interface (UPI) standards for its QR deployment. Bhutan will also become the only country to both issue & accept RuPay cards as well as accept BHIM UPI.”

In 2020, UPI enabled commerce worth USD 457 Billion, which is equivalent to approximately 15% of India’s GDP.

“Our vision has always been focused on taking our robust and popular payments solutions to global markets”, said Ritesh Shukla, CEO, NPCI International Payments Limited (NIPL).



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