Regulations
Government mulling restrictions on cash-surplus investments of PSUs

Under the new guidelines, the government is expected to offer a number of options like mutual funds, term deposits, treasury bills and government securities to for cash-rich CPSEs for investing their surplus funds

 
New Delhi: The Indian government is contemplating tightening norms for use of surplus funds by cash-rich public sector units (PSUs) by restricting their investments to debt schemes of mutual funds with a minimum corpus of Rs1,000 crore, reports PTI.
 
"Besides, Central Public Sector Enterprises (CPSEs) would have another option to park their funds in term deposits with any scheduled commercial bank and with a net worth of Rs500 crore," an official told PTI.
 
Currently, this limit for commercial banks is Rs100 crore.
 
The present guidelines do not specify any corpus size of mutual fund company for investments by PSUs.
 
A committee of the Department of Public Enterprises (DPE) headed by Shaktikanta Das, additional secretary in the Department of Economic Affairs, has held many meetings to discuss various options available with regard to investments by Central Public Sector Enterprises (CPSEs).
 
The panel is in the process of rationalising and consolidating the existing investment norms for CPSEs, the official said.
 
"Under the new guidelines, the government is expected to offer a number of options like mutual funds, term deposits, treasury bills and government securities to CPSEs for investing their surplus funds," the official added.
 
Cash-rich PSUs like GAIL, Coal India and ONGC would be allowed to invest in mutual funds debt scheme with a corpus amounting to at least Rs1,000 crore for the scheme, he added.
 
At present, there are various norms issued by the DPE on investment of excess funds available with such PSUs.
 
In a meeting convened by Prime Minister Manmohan Singh, on 23rd October, he had asked 25 cash-rich central PSUs to invest their surplus fund of Rs2.5 lakh crore to accelerate economic growth.
 
The meeting was attended by Finance Minister P Chidambaram and Planning Commission Deputy Chairman Montek Singh Ahluwalia besides heads of 25 PSUs, including ONGC, Coal India, BHEL, NTPC, SAIL, NMDC.
 
Heavy Industries and Public Enterprises Minister Praful Patel had said : "If the PSUs do not deploy the investible surpluses in their own growth and expansion, that money should not lie idle and it must be paid back to the government by way of special dividend".
 
Besides, he had said the government would form a committee of secretaries, to be headed by Cabinet Secretary Ajit Kumar Seth, to look into the issues of PSUs regarding like autonomy, regulatory clearances and investment of surplus funds, among other things.
 

User

Shriram Life Insurance launches 'money back term plan'

Shriram Life Insurance's Money Back Term plan offers to pay a lump sum payment in case of death of the life assured during the policy term while on survival, all basic premiums paid during the policy term would be returned

 
Chennai: Private insurer Shriram Life Insurance Company has launched a new 'money back term plan', a 'non-linked, non-participating' assurance life cover, reports PTI.
 
"The minimum annualised premium is kept as low as Rs3,000 in line with our philosophy of bringing financial products within the means of the customers," Shriram Life CEO Manoj Jain said in a release.
 
The New Money Back Term plan offers to pay a lump sum payment in case of death of the life assured during the policy term while on survival, all basic premiums paid during the policy term would be returned.
 

User

SEBI disposes of enquiry proceedings against Adroit Financial

SEBI had alleged that Adroit Financial Services along with another broker had entered into a number of cross deals, structured deals and synchronised deals which resulted into "creation of false market" for Shamken Multifab shares

 
Mumbai: Market regulator Securities and Exchange Board of India (SEBI) has disposed of the matter against Adroit Financial Services after the entity made a payment of Rs10 lakh to settle charges related to fraudulent trade practices in shares of Shamken Multifab Ltd, reports PTI.
 
In an order dated 1st November, SEBI said that "this consent order disposes of the aforesaid enquiry proceedings initiated against Adroit Financial Services Ltd".
 
A probe by SEBI into the scrip of Shamken Multifab Ltd found an increase in price and volume of its shares during 23rd February to 20th July 2000.
 
SEBI noticed that Adroit Financial Services along with another broker were having major concentration in trading.
 
The regulator alleged that Adroit Financial Services along with another broker had entered into a number of cross deals, structured deals and synchronised deals which resulted into "creation of false market".
 
Pending proceedings, Adroit Financial Services under SEBI's consent order mechanism offered to make a payment of Rs10 lakh as settlement charges.
 
Thereafter, a High Powered Advisory Committee (HPAC) considered the consent terms and recommended the case for settlement on payment of the said amount. The same was approved by SEBI.
 
In a separate consent order, the regulator dismissed the matter against Keynote Corporate Services after the entity made a payment of Rs 5 lakh to settle charges for allegedly failing to abide by norms for merchant bankers in the public issue of Consortex Karl Doelitzsch (India) Ltd.
 
SEBI in its order dated October 31 said that " this consent order disposes of the proceedings initiated against Keynote Corporate Services Ltd...It is clarified that the settlement in this order shall extend only to the charges levelled against the applicant in the said SCNs (Show Cause Notices)".
 
The matter relates to an enquiry by SEBI in the public issue of Consortex Karl Doelitzsch (India) Ltd.
 
SEBI alleged that Keynote Corporate Services as a lead manager, failed to render high standards of service, by not verifying the records/contents of the certificate of the auditor independently and "thus failed to exercise due diligence, proper care and independent professional judgement in the public issue of Consortex Karl Doelitzsch (India) Ltd".
 

User

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)