Regulations
SC to hear SEBI's plea for appointing receiver of Sahara's assets
New Delhi : The Supreme Court will hear, on February 2, market regulator SEBI 's plea seeking appointment of a receiver for sale of Sahara group's assets for compliance of the apex court's August 2012 order to return investors' money that it had raised in 2008 and 2009.
 
A bench headed by Chief Justice T.S.Thakur directed the hearing of the application next month as senior counsel Arvind Datar, appearing for the Security and Exchange Board of India (SEBI), on Wednesday, urged the court to hear the plea.
 
He told the court that there was no progress in the direction of Sahara mobilising the funds to return the investors money raised through optionally fully convertible debentures (OFCD)as directed by the court. 
 
Counsel appearing for Sahara however said that there was no urgency and they were negotiating with new prospective buyers.
 
At this the court observed that some directions are required to be passed on the matter.
 
The apex court on September 28 had asked Sahara to file its reply to SEBI's application seeking the appointment of a receiver to take over the charge of the entire assets of the group, located within and outside the country, sell the same and deposit the proceeds in SEBI's Sahara Refund Account.
 
The apex court by its August 31, 2012, order had asked Sahara to repay investors Rs.17,400 crore with an interest component of 15 percent. This amount, according to market regulator, coupled with interest component, has escalated to Rs.36,000 crores.
 
Coupled with the plea for the receiver's appointment, SEBI has also sought the refund of Rs.41 crore that it had spent in connection with the scanning, storage, handling and other incidental expenditure relating to investors documents.
 
It said that it has completed the scanning of the documents submitted by Sahara relating to the investors and urged the court to direct the group to either take back the documents or the charge of the storage where they are kept. It said that it was spending Rs.10 lakh per month for their storage.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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COMMENTS

Vaibhav Dhoka

1 year ago

The order must be executed in time bound manner when justice can be seen as DONE>

Should you invest in IREDA tax-free bonds?
Tax-free offer of 7.53% to 7.74% may attract retail investors based on recent trends. HNIs have been much more aggressive even though they are offered 0.25% lower coupon. Find out why IREDA coupon is better than the previous issues
 
Indian Renewable Energy Development Agency (IREDA) will offer tax free bond issue of Rs1,716 crore from 8th January and is supposed to close for subscription on 22 January 2016. The recent issue of National Highway Authority of India (NHAI) received Rs22,000 crore worth of applications for the Rs10,000 crore issue. Tax-free bonds are now a star attraction with Bollywood and corporate world biggies, private sector and foreign lenders pumping in crores for the hot product. However, they fell short when it came to full subscription of NHAI from retail investors, which could be due to the bigger issue size of six times. This is when compared to the holidays and retail investment previous issues. Retail investors were allotted merely 15%-20% of their investment in NTPC and Rural Electrification Corp Ltd (REC).
 
Considering the small size issue of IREDA, it should be a breeze and hopefully, retail investors will jump in based on higher coupon rate (by 14 basis points (bps)), when compared to the NHAI issue. NHAI, in turn, had offered higher coupon than Indian Railways Finance Corp (IRFC) by seven basis points (bps) for both 10- and 15-year bonds. It clearly shows that experts cannot predict rates of future bond issues.
 
 Investors who had the patience to wait can look forward for some investment in the 15-year IREDA bonds @7.74%. Another reason for uptick in the coupon for IREDA is to do with the credit rating of ICRA AA+ instead of ICRA AAA for NHAI. CARE has given IRDEA issue rating of AAA (Structured Obligation).
 
What do IREDA tax-free bonds offer?
 
Tax-free bonds from government enterprises are a good option for those in the higher tax bracket and for investing for long-term. With one to 10 years bank FD offering 7.25%-7.75% taxable interest, tax-free bonds with 7.74% coupon is attractive for those in 20% or higher tax bracket. Awareness of tax savings, by investing in government owned companies’ tax-free bonds issues, has helped recent issues offering around 7.5%. Earlier, there were issues offering nearly 8% in 2012-13 but the issues had difficulty in getting subscribed quickly.
 
Interest rate cycle is difficult to predict. Investors who purchased lots of tax-free bonds in 2012-13 at a coupon of nearly 8% may have missed 2013-14 issues of over 9% coupon if they had not kept funds ready for it. So, invest in upcoming tax-free bonds, but do not exhaust all the funds. If there are tax-free bond issues one year from now, it will be almost impossible to guess whether future coupon rate will be higher or lower.
 
Since January 2015, RBI has slashed repo rate by 125 bps, Since January 2015, RBI has slashed repo rate by 125 bps. There are predictions about Reserve Bank of India (RBI) holding the repo rate till the end of financial year and other reports claiming that change is not possible till end of 2016. As expected, RBI kept the rates unchanged in its fifth bi-monthly policy on 1st December awaiting more signals on the inflation front, Pay Commission proposals and the Centre’s fiscal path. November inflation with consumer prices rising 5.4% is seen above RBI’s comfort level of 5% reducing hope of rate cut.
 
The future tax-free bond rates will depend on G-Sec rates which have been holding up even after the 50 bps cut in repo rate by (RBI) in September. Since January 2015, RBI has slashed repo rate by 125 bps,  Since January 2015, RBI has slashed repo rate by 125 bps. Since January 2015, RBI has slashed repo rate by 125 bps, Since January 2015, RBI has slashed repo rate by 125 bps, The 10-year G-sec yield has actually increased in last couple of months to 7.74% as on 6th January primarily on sustained selling pressure from banks and corporates. However, going forward, the yields will gradually soften says State Bank of India (SBI) in its Ecowrap report. Net supply is one of the reasons why G-sec yields are not coming down. 
 

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COMMENTS

Ankush.wadhwa

1 year ago

Good Evening Sir,

I applied for IREDA tfb issue on 8 january 2016 by depositing physical application form in bank and got acknowldegment at the same time. It was bidded.

Bank has not presented that cheque into my account till 12 Jan 2016. In this case what will be the status of my allotment?

Thanks
Ankush

REPLY

raj pradhan

In Reply to Ankush.wadhwa 1 year ago

If you applied on first day, you have good chance of getting more than 50% of application amount. Retail quota was oversubscribed by 1.85 times on first day.

Don't worry about the cheque clearance. It must have happened today (13th) or will happen. It has no impact on your allotment.

Santosh Prasad Nayak

1 year ago

How to buy these bonds ?
any online links ?

REPLY

raj pradhan

In Reply to Santosh Prasad Nayak 1 year ago

Going through distributor or ASBA is your best bet. ASBA can be done through application form offline or through net banking of the banks which support this issue.

Kumar

In Reply to raj pradhan 1 year ago

Can you provide me which bank for IREDA bonds to buy . is axis in list ? and if offline can you provide link for that.

Rehearse
Kumar

s k chugh

1 year ago

whether the money will remain locked in for the duration of the scheme?

REPLY

raj pradhan

In Reply to s k chugh 1 year ago

Can sell in secondary market subject to volume

S k chugh

1 year ago

if a retail investor invests rs one lakh in bonds.can he get monthly return of rs645per month sk chugh

REPLY

raj pradhan

In Reply to S k chugh 1 year ago

Interest payment done annually

Anand Vaidya

1 year ago

Seems the offer opens on 8th jan, not 7th jan as you mention. Can you please clarify?

REPLY

raj pradhan

In Reply to Anand Vaidya 1 year ago

Yes, it is 8th. we will correct it

Nifty, Sensex rallies may be short-lived – Wednesday closing report
Nifty may be headed below 7,700
 
We had mentioned in Tuesday’s closing report that Indian benchmarks Nifty and Sensex are headed lower and that Nifty decline will end, only if it goes above 7,860. Major indices in the domestic stock markets fell further on Wednesday after last day’s trading and the losses at the end of the day were 0.50%-0.68%. The trends in the major indices during the day’s trading are given in the table below:
 
 
Geo-political tensions, coupled with caution over upcoming macro-data and quarterly results, depressed Indian equity markets on Wednesday. Initially, the bellwether indices opened on a flat-to-negative range in the wake of two days of consecutive falls, disappointing domestic macro-data and global uncertainties. Nevertheless, both the indices soon pared their losses on the back of short-covering, value-buying and positive Asian markets' close. 
 
Finance Minister Arun Jaitley's comments on Tuesday regarding further reforms in the infrastructure sector also buoyed sentiments. However, the benchmarks soon receded, as investors were spooked over the rising geo-political tensions in the Far East following North Korea's reported testing of a thermo-nuclear device. In addition, volatility was stoked by the upcoming US non-farm payroll figures scheduled for release on late Thursday India time, along with minutes of latest FOMC (Federal Open Market Committee) meeting. Both the events could provide indications on future US rate hikes. Besides, caution prevailed over the upcoming domestic macro-data on industrial output, retail inflation and the third-quarter earnings results which start coming in from 12th January.
 
The Indian cabinet on Wednesday approved setting up of a credit guarantee fund for loans of Micro Units Development & Refinance Agency Ltd or MUDRA Bank. The fund is expected to guarantee loans worth more than Rs1 lakh crore to micro and small units in the first instance, the government said. The cabinet meeting chaired by Prime Minister Narendra Modi also gave its nod to covert MUDRA Ltd to MUDRA Small Industries Development Bank of India (MUDRA SIDBI Bank),  a wholly owned subsidiary of SIDBI. 
 
Finance Minister Jaitley in his budget speech for 2015-16 had said MUDRA Bank and a credit guarantee fund was proposed to be set up with a refinance corpus of Rs20,000 crore and Rs3,000 crore, respectively. Prior to the launch of the Pradhan Mantri MUDRA Yojana (PMMY) in April 2015, MUDRA Ltd was set up as a subsidiary of SIDBI in March 2015. The Reserve Bank of India (RBI) has allocated Rs20,000 crore and the first tranche of Rs5,000 crore has been received by MUDRA as refinance. The credit guarantee fund is set up to guarantee loans given under Pradhan Mantri Mudra Yojana. This is done to reduce the credit risk to banks, non-banking finance companies and others who are member lending institutions. The guarantee would be provided on portfolio basis to a maximum extent of 50% of amount in default in the portfolio.
 
The union cabinet also approved a proposal for taking up Hybrid Annuity based Public Private Partnership (PPP) model under Namami Gange Programme that aims to reform the wastewater sector in the country. "Hybrid Annuity based PPP model will now be adopted to ensure performance, efficiency, viability and sustainability," an official statement said. 
 
"In this model, a part of the capital investment (upto 40%) will be paid by government through construction linked milestones and the balance through an annuity over the contract duration upto 20 years," it added. 
 
Keeping in view the specialised nature of this model and to scale it up in future on sustainable basis, the government is establishing a Special Purpose Vehicle (SPV) to plan, structure, procure concessionaires, monitor implementation of such PPP projects and develop market for treated waste water through appropriate policy advocacy under overall guidance of National Mission for Clean Ganga (NMCG). The SPV will be established under the Indian Companies Act 2013 for providing required governance framework and enabling functional autonomy. The SPV would enter into a Tripartite Memorandum of Agreement (MoA) with participating state governments and concerned Urban Local Bodies (ULBs) for taking up individual projects.
 
India's largest textile park will come up in Telangana's Warangal town, Chief Minister K Chandrasekhar Rao announced on Wednesday. He said the proposed 'cotton-to-garment' park will be set up in an area of 2,000-3,000 acres. The Warangal district collector has already released Rs100 crore for acquiring land for the textile cluster. The chief minister said that while textile parks in different parts of the country like Solapur, Tirupur and Surat were engaged in manufacturing specific categories of garments, the proposed park in Warangal will cover all segments. 
 
Coming back to Indian stock markets, here are Wednesday’s top gainers and losers on major indices:
 
 
Chinese stocks closed higher on Wednesday, with the benchmark Shanghai Composite Index up 2.25%, at 3,361.84 points. The smaller Shenzhen index gained 2.24% to close at 11,724.88 points, Xinhua reported. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, jumped 2.14% to close at 2,468.37 points.
 
Japanese shares ended the trading Wednesday lower as sentiment was hit by the hydrogen bomb test conducted by North Korea and by the yen's advance against the US dollar. The 225-issue Nikkei Stock Average shed 182.68 points, or 0.99%, from Tuesday at 18,191.32, a roughly 11-week closing low, Xinhua reported. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was down 15.87 points, or 1.05%, to 1,488.84. The decliners were led by oil and coal products, mining and miscellaneous products sessions. The turnover was about 2,430.7 billion yen ($20.48 billion).
 
The closing values of major Asian indices are given in the table below:
 

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