This is the second highest value of offers made in a month since January 2013 when companies had made 11 open offers for Rs8,308 crore
Public shareholders received open offers worth a whopping Rs7,003 crore by listed companies in April—the second highest level in the year so far.
A total of 10 open offers for shares worth Rs7,003 crore were made by the companies in April to buy shares from public shareholders, as per the latest data compiled by the Securities and Exchange Board of India (SEBI).
This is the second highest value of offers made in a month since January 2013 when companies had made 11 open offers for Rs8,308 crore.
Besides, the amount is significantly higher compared to the four offers amounting to Rs135 crore in March, this year.
According to SEBI regulations, pursuant to substantial acquisition of shares or change in control in a listed firm, an acquirer has to make an offer to the public shareholders, known as open offers, so as to give them a fair opportunity to exit the company if they so wish to.
Open offers are made with the objective of change in control of management, consolidation of holdings or substantial acquisition in a company.
“Out of the 10 public takeover offers during April 2013, nine offers worth Rs6,977 crore were for consolidation of holdings while there was one offer worth Rs26 crore for change in control of management and none for substantial acquisition,” SEBI said.
As per the regulator’s latest monthly bulletin, six firms closed their offers in April, including one offer related to acquisition of 4.8 crore shares of United Spirits by Relay BV.
United Spirits shares were offered at a price of Rs1,440 apiece, amounting to Rs6,935.57 crore.
The other companies for which offers closed were—Orient Refractories, Mapro Industries, Shree Surgovind Tradelink, Archana Software and Hind Syntex.
HDFC Bank is targeting non-resident Indians (NRIs) with a fixed income product, exposing them to foreign currency fluctuations. If a customer loses money, he has to be blamed, of course, for falling for this hard-sell from his 'trusted' banker
Rupeemax is a product that HDFC Bank is targeting at non-resident Indians (NRIs) with the tagline “Earn better returns on your NRE Deposits: 12%.” A breathless email message, seeking appointments with well-heeled NRIs, draws attention “to a very interesting opportunity in the NR FD space.” The marketing pitch says: NRE FDs have earned 8.75% compounding quarterly over a 5-year period giving a tax free, repatriable interest of 10.83% over that period. For that same period, HDFC Banks claims, “we can enhance the rate from 8.75% to 9.5%, which with the compounding effect can deliver an annual yield of 11.9% to12.10% as against 10.83%.” The ‘key concern’ is a 5-year lock-in to maturity. The official goes on: “I believe this is an excellent opportunity and is short lived as this enhanced yield is a function of cross currency movements, which currently are in favor.!!!!!!!!!!!!! Also the interest rates are expected to head downwards in the near future wherein this makes a lot of sense.”
Dr KC Chakrabarty, deputy governor RBI, tells customers to be wary of higher returns offered by banks. The global consultant who received this was certainly sceptical and checked with a fund manager who, in turn, sent it to Moneylife with this comment: “Is this real or is HDFC Bank pulling a 3-card trick?” A simple reading of the email suggests it is pitching a fixed deposit with a 5-year lock-in. We asked the Bank if the email was genuine.
A response from HDFC Bank’s NRI team underscores the dangerous toxicity of the product. It says the product is built on the fact that RBI guidelines allow NRIs to “hedge their FCNR and NRE deposits.” It assumes that “NRIs are normally sophisticated investors with knowledge of cross currency risk. They compare the interest rates offered on FCNR and NRE deposits and other similar investments available across different geographies. Depending on the interest rates available on these deposits and forward premia prevailing at the time, NRIs tend to invest in FCNR deposits and sell foreign currency in the forward leg (with the maturity proceeds) thereby earning a better rate than on NRE deposit. Conversely, NRIs may tend to invest in NRE deposits and buy foreign currency in the forward leg (using the maturity proceeds) thereby earning a better rate than on FCNR deposit. These are, of course, permissible transactions in accordance with the above quoted provisions of law.”
Really? Most of our NRI friends and relatives, even in the finance industry don’t have a fraction of the base sophistication that HDFC Bank is assuming. Worse, it is pitched at people whose money is safely in tax-free NRE fixed deposits. HDFC Bank goes on to explain that “the rate of 12% quoted in the mail was indeed the maximum rate that a client could have earned by investing in this product yesterday. This yield was available by booking a 5-year Japanese Yen FCNR deposit and selling the Yen maturity proceeds in the forward leg. The risk factors and other aspects that need to be known by clients are shown in the emailer.” Is the vague line about the yield being a “function of cross currency movements” which are “currently in our favour” an indicator of product risk? In fact, the only risk flagged by the email is the 5-year lock-in, which skilfully suggests that the higher return is the reward for locking in his money for five years. There is no indication that a 12% return is not guaranteed. If a customer loses money, he has to be blamed, of course, for falling for this hard-sell from his trusted banker. Will RBI put in place any mechanism to check such blatant mis-selling of even fixed-income products? Globally, regulators are moving away from the principle of caveat emptor, which had left savers to the mercy of snake-oil salesmen in bankers’ garb. When will RBI start thinking along these lines and put in place a mechanism to report such products?
BluFin's Consumer Confidence Index (CCI) rose to 41.4 points in May, an increase of 3.4 points since the beginning of the year, due to improved spending behaviour coupled with easing inflation
Indian consumers' confidence level rose in the month of May on the back of to improved spending behaviour coupled with easing inflation, a study by financial services provider BluFin revealed.
BluFin's Consumer Confidence Index (CCI) rose to 41.4 points in May, an increase of 3.4 points since the beginning of the year.
The index is a key ‘aggregate’ indicator that assesses the pulse of urban Indian consumers with regard to the economy, spending behaviour and employment. The index reflects pessimism at below 50 score and optimism above that.
The two key components of the CCI indicated improvement in the consumer sentiment.
A sub index, which rates inflation sentiment, rose from 23.9 points in January to 26.8 points in May, while the spending sentiment improved from 28.3 points to 30.5 points in the same period.
However, pessimistic views on employment continue to be a small drag on the consumer confidence index. The employment sentiment declined to 50.2 points in May from 51.4 points at the beginning of the year.
Nonetheless, the score itself is encouraging as it is above the benchmark level of 50.
Another sub-index, which measures future expectations, was at 40 points, indicating consumers were still pessimistic about the economy's prospects. However, consumers were more comfortable about their present situation with a score of 46.
In terms of region, consumer confidence in North India registered a rise of about two points to 39 points in May, after a steady decline since January 2013.
“North Indian consumers, who have been the most sensitive to economic vagaries in the recent past, have been showing increased propensity to spend. This makes the North India numbers a lead indicator of an impending turnaround in overall consumer sentiment in India,” BluFin CEO Rashid Bilimoria said.
“A key driver for this improvement is declining pessimism about inflation among consumers leading to a rising expectation of a rate cut,” he added.
The survey has shown consumers in the eastern region of India to be the most pessimistic while those in the southern states to be the most optimistic, with cities such as Bangalore generally scoring above the benchmark level of 50.
The index is based on nation-wide monthly surveys of 4,000 respondents across 18 cities conducted by custom market research company TNS.