Dhapdhapi (West Bengal): Reserve Bank of India (RBI) deputy governor Subir Gokarn today said though microfinance institutions (MFIs) could be under stress, there is no threat to their survival, reports PTI.
“This is a fact that the MFIs were facing shortage of funds as banks are shying away. MFIs might be under temporary stress, but not under threat,” Mr Gokarn told reporters at a financial inclusion programme here in South 24 Parganas district.
Keeping this situation in mind, the RBI has restricted the timeframe for submission of the YH Malegam Committee's report on MFIs to two months.
“It is true that a longer timeframe is needed to make the findings of the committee more comprehensive, but a balance has to be struck between timeframe and comprehensiveness,” he said.
The committee was expected to submit its report by the middle of January.
Asked whether non-banking finance companies (NBFCs) would be allowed to act as business correspondents (BC) on behalf of commercial banks, he said there was a conflict of interest inherent in this.
Since banks were engaging BCs for last mile connectivity, NBFCs were also reaching out to the unbanked areas. “There is a question in allowing NBFCs for the time-being,” he said.
According to broad principles, MFIs were important for establishing the last-mile connectivity required for financial inclusion.
But there should not be any deviation from this, which would undermine the purpose, he said.
To a query, Mr Gokarn said the fact can't be ignored that banks would have to make money out of the financial inclusion initiative. “Banks must see it as a business opportunity.”
In the early stages, it might not be easy to find the activity commercially viable.
RBI was looking at possible ways to facilitate the banks in this regard, he said.
Mr Gokarn today inaugurated a customer service point of United Bank of India (UBI) for villagers of the region. UBI CMD Bhaskar Sen was also present.
The stock has hit the lower circuit for eight days in a row. Market players blame operators close to promoter circles
It has hits like Dabangg and Golmaal 3 under its belt and it is planning a few more blockbusters. Yet, the stock price of Shree Ashtavinayak Cine Vision (SACVL), this successful movie producer, is crashing. The stock price has plunged from around Rs 50 on 5th November to Rs18.50 today. And what a crash it has been.
Since 25th November, on every single day of the last eight trading days, the stock has been locked in the lower circuit. This kind of crash happens when a company is in dire straits. We asked around but nobody had heard of any kind of trouble for the company. What then is the issue?
SACVL has been what is called an "operator-driven" stock. This means that a bunch of big players with the help of people close to the promoters effortlessly rig the prices up and down as they please, even as the stock exchanges and the market regulator
Consider this. The stock price of SACVL on 5th November touched Rs51.20 and closed at an all-time high of Rs49.65 on that day, the highest level since the previous peak in February 2010. Over the next fortnight the price slipped to Rs43.50 on November 24, then moved up again to Rs45.75 on 25th November, from which level it has been falling continuously.
There appears to have been a similar pattern in February this year, when the stock price reached around Rs33. There was a similar crash and the stock was locked in the lower circuit for days on end until it touched a low of Rs10.65 in intraday trading on 11th March.
Clearly, it's useless to correlate the stock with the company's business. Dabangg set a record by grossing around Rs 80 crore in the first week, making it the highest grossing Bollywood film in 2010. The film also did remarkable business overseas. Its next production, Run Bhola Run, is expected to be released in February 2011.
However, investors seeking to buy the stock on the basis of the performance of these film productions could well burn their fingers. "It is a stock consistently rigged by operators," said an official with a top equity trading firm, who requested anonymity.
New Delhi: Driven by the growth of organised retail coupled with changing consumer habits, food retail sector in India is set to more than double to $150 billion (around Rs6,70,870 crore) by 2025, reports PTI quoting a report by KPMG.
India's food retail sector, which is currently estimated at $70 billion (around Rs3,13,137 crore) will more than double in the next fifteen years, the global audit and advisory firm KPMG said.
“Evolution of innovative food processing capacity, emergence of organised retail and change in consumption patterns along with fast changing demographics and habits is fuelling the next growth trajectory for the food industry in India,” KPMG said in a statement.
Despite the potential, the sector has not yet seen sufficient investment, especially foreign direct investment (FDI), the report said.
“The food sector, in spite of its large share of GDP and the consumer basket, received only 3.3% out of the gross FDI flows in India between 2000 and 2010,” KPMG executive director Ramesh Srinivas said.
High growth in food retail is limited by sub-optimal supply chain caused by low investment in the sector, he added.
Some players such as McDonalds, RK Foodland, Jubilant Food Works (Dominos) have, however, invested in back-end processes, optimised supply chain management, according to KPMG.
“There is also considerable investment in the cold chain industry by multinational corporations and private equity firms,” Mr Srinivas added.