SEBI tightens insider trading norms; eases delisting norms

While approving stricter norms to deal with insider trading menace SEBI has also eased delisting norms for companies


Market regulator Securities and Exchange Board of India (SEBI) on Wednesday approved stricter norms to deal with insider trading menace. SEBI also widened the definition of insider by including persons connected on the basis of being in any contractual, fiduciary or employment relationship that allows such person access to unpublished price sensitive information (UPSI).

The market regulator also eased delisting norms for companies by approving amendments to delisting regulations. To make delisting process easier, the SEBI board also decided to bring down total time required for completion of voluntary delisting from the exchange to 76 days from the current 137 days.

"The delisting shall be considered successful only when the shareholding of promoter together with shares tendered by public shareholders reaches 90% of total share capital. At least, 25% of the number of public shareholders need to be a part of reverse book building process," SEBI said.

SEBI Board in its meeting also approved new reforms in consent mechanism including giving the company an opportunity to settle a matter before issuing a show cause notice.

The market regulator said it is also reviewing the policy to restrict a company, its promoter or director, who has been categorised as wilful defaulter, from raising capital and would soon come out with a discussion paper.



Nifty, Sensex headed lower – Wednesday closing report

Nifty will try to rally but is eventually headed lower


We had mentioned in Tuesday’s closing report that CNX Nifty may find it difficult to head higher and a close below 8,400 in Nifty may trigger a short-term decline. In the morning session the index witnessed a weak move. In the noon session the benchmark made a gradual decline.

S&P BSE Sensex opened at 28,194 while Nifty opened at 8,441. Sensex moved lower to 27,964 after hitting a high at 28,294 while Nifty moved from the level of 8,456 to 8,361. Sensex closed at 28,033 (down 130 points or 0.46%) while Nifty closed at 8,382 (down 44 points or 0.52%). NSE recorded a volume of 95.39 crore shares. India VIX rose 1.99% to close at 14.3450.

The Organisation for Economic Cooperation and Development (OECD) today, 19 November 2014, said the Indian economy is showing signs of a turnaround. New reforms, some of which are included in the package presented by Prime Minister Narendra Modi, need to be implemented to put the country on a path to strong, sustainable and inclusive growth, according to the latest OECD Economic Survey of India. According to the survey, India's GDP should grow by more than 6.5% annually in the coming years.

Moody's revised its outlook on India's corporate sector to stable from negative on expectations of economic recovery and enhanced access to global capital markets.

The top four gainers in ‘A’ group on the BSE were SRF (9.24%), Ajanta Pharma (8.53%), Amara Raja (7.90%) and Manappuram Finance (6.71%) were the top four gainers.

For the third consecutive session Rasoya Protein hit a new 52-week low. The stock (9.89%) was the top loser in ‘A’ group on the BSE.

Dr Reddy's Lab (2.45%) was the top gainer in the Sensex 30 pack. The stock hit its 52-week high today. It was in the news for the surprise inspection conducted by USFDA at its Vizag plant.

Sesa Sterlite (2.75%) was among the top two losers in Sensex 30 stock. The stock was recently in the news for taking up a Rs2,500-crore expansion at its copper smelter plant in Tuticorin.

Asian indices showed mixed performance. Taiwan Weighted     (1.18%) was the top gainer while Hang Seng (0.66%) was the top loser.        

Japanese Prime Minister Shinzo Abe told ruling party leaders that he will delay an unpopular sales tax rise and call a snap election.

German economic sentiment beat expectations. ZEW Centre for Economic Research reported that its German economic sentiment index rose by 15.1 points to a four-month high of 11.5 this month from October's reading of -3.6. The index of euro zone economic sentiment increased to 11.0 in October from 4.1 in September, above expectations for an increase to 4.3.

On Tuesday, US indices closed in the green. European Futures were showing mixed trading while US Futures were trading flat.


Govt's draft guidelines say coal blocks only for end-users

According to the draft guidelines, reserve price will be determined before 22nd December, while bidding fees will be based on geological reserves of coal mines


The Indian government has released draft guidelines for allocation of 74 coal blocks. Under the draft rules, issued by the Ministry of Coal, the Centre plans to allow a successful bidder of coal mines to use coal from the mine allocated to it for any its other plant after prior intimation the government.


The Centre government plans to conduct two-stage bidding under the Coal Mines Special Provisions Ordinance. Qualified bidder in stage one would be asked to put in financial bid under an electronic auctioning process. The bidding would be open to specified end use projects in power, steel and iron, and cement sectors.


"The floor, reserve price metrics being worked out currently by authorities," Coal Secretary Anil Swarup said, adding that idea is to keep a lid on tariff rather than adopt a revenue maximisation approach. The reserve price will be determined before 22nd December, while the bidding fees will be based on geological reserves of coal mines, he added said.


The due date for coal auction is 11 February 2015. The Ministry hopes to complete technical process of allotment by 3rd March and issue letter of award by 16 March 2015.


The tender documents, which are to be issued later, would specify the technical and financial qualification of participants in the auction.


The Supreme Court had in September cancelled 214 coal blocks allocated since 1993, saying the blocks had been given out in an ad-hoc and casual manner.


The NDA government moved an ordinance late in October enabling auctions of some of these blocks. Finance Minister Arun Jaitley said at the time that an enabling provision would be made later to introduce commercial mining, which would open up the sector to mining companies selling coal to users. However, introduction of commercial mining will require changes to the Coal Mining Nationalisation Act, 1973.


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