Sensex, Nifty further upmove may be clear on Monday: Thursday closing report

As mentioned yesterday, the Nifty saw a recovery today. But a close above 5,600 on Monday is required for the up move to gain strength

The Sensex opened higher while the Nifty opened lower on Thursday. Taking cues from the Asian market, both the indices edged higher to close in the positive breaking the two days of consecutive trading losses. China reported much better than expected trade results for July, marking a sharp recovery from the previous month.  In the first hour of the trading session itself, the indices hit their respective days low. The Sensex opened at 18,687 and soon hit a higher low of 18,622, while the Nifty opened at 5,510 and hit at the same level. The National Stock Exchange (NSE) recorded a volume of 59.77 crore shares.


The stock market remains closed tomorrow, 9 August 2013, because of Ramzan Id.


At the close of the session, the benchmark hit their respective days high and closed a bit lower. The Sensex hit a higher high of 18,829 and closed at 18,789 (up 124 points or 0.67%) while the Nifty hit a higher high of 5,578 and closed at 5,566 (up 47 points or 0.84%). Among the major indices on the NSE, Smallcap was the top gainer, rising 2.17%.


Of the 50 stocks on the Nifty, 38 ended in the in the green. The major gainers were Ranbaxy (28.60%); Hindalco (5.78%);  Cipla (5.73%);  Tata Steel (5.72%) and DLF (4.27%). The main losers were State Bank of India (3.60%); Sun Pharma (3.08%); Lupin (2.92%); Dr Reddy (1.28%) and Reliance Industries (1.07%).


Out of the 27 main sectors tracked by Moneylife, the top three and the bottom three indices were:


Top ML sectors


Bottom ML sectors






Non-ferrous metals




Telecom services


Consumer products



The first meeting of the sub-committee of Financial Stability and Development Council (FSDC), chaired by RBI Governor D Subbarao met on Wednesday, where the participants discussed the “potential risk to stability of the domestic financial system”. The sub-panel also expressed concern on the deteriorating asset quality of public-sector banks and discussed corrective measures for this.


The second meeting, of the high-level committee on external commercial borrowings (ECBs), discussed measures to relax ECB norms to allow leveraged firms to tap foreign markets for funds, and to repay rupee loans from ECB proceeds.


US indices fell on Wednesday on growing uncertainty over when the Federal Reserve will start to wind down its stimulus, which has been a driving force behind the rally in equities this year. Federal Reserve Bank of Cleveland President Sandra Pianalto said on Wednesday that the central bank would be prepared to scale back asset purchases if the labour market remains on the stronger path followed since last fall.


Asian indices were a mixed bag. Jakarta Composite went up the most, up 0.36% while Nikkei 225 fell the most, 1.59%. China's exports and imports rebounded in July, exceeding estimates and adding to signs that the world's second-largest economy is stabilizing following a two-quarter slowdown. Shipments abroad rose 5.1% from a year earlier, the General Administration of Customs said in Beijing today. Imports jumped 10.9%, leaving a trade surplus of $17.8 billion.


German exports slightly recovered in June from May's sharp decline, official data showed Thursday, but foreign trade remains lackluster. Exports of goods, as opposed to services, rose 0.6% in June from May, but declined 2.1% from June 2012, data from the federal statistics office showed, indicating that foreign trade continues to lack momentum. Exports, traditionally a key driver of economic growth in Europe's largest economy, declined 0.6% in January-June compared with the same period a year earlier, as shipments to the euro zone dropped 3.1%. Imports, meanwhile, declined for the first time in four months. German goods imports in June were down 0.8% on the month and declined 1.2% on the year.


European indices were trading in the green and US Futures were also trading positive.


Companies Bill gets Parliamentary nod, finally

The Bill, which replaces 57-year old regulations, aims to protect interest of employees and small investors while encouraging firms to undertake social welfare voluntarily instead of imposing that through “inspector raj”

Two years after it was introduced in parliament, the Companies Bill, that enhances corporate accountability, introduces the concept of corporate social responsibility and encourages e-governance, was finally cleared by the Rajya Sabha on Thursday.


In December 2011, the Bill was introduced in the Lok Sabha by the then corporate affairs minister Veerappa Moily after he withdrew a similar legislation of 2009 on the ground that the revised measure incorporating several recommendations and suggestions made by the Parliamentary Standing Committee on Finance and various stakeholders.


For the first time, the Bill makes it mandatory for firms to maintain their documents in electronic format, introduces the concept of e-governance, makes provision for encouraging ethical corporate behaviour and rewards employees for their integrity.


Among the measures proposed in the fresh bill to enhance accountability are those, which provide for additional disclosure norms, facilitate raising of capital, mergers and acquisition and protection of investors and minority shareholders, the Statement on Objects and Reasons of the Bill said.


The original Companies Act was enacted way back in 1956 and has been in operation ever since.


In view of changes in the national and international economic environment and growth in the economy, the need was felt to enact a new law, it said.


The Companies Bill 2009 was then introduced in Parliament and sent to the Standing Committee, which presented its report in August 2010. A large number of recommendations were made by it and suggestions came in from several stakeholders.


Many of these were accepted by the government, which then decided to withdraw the 2009 measure and introduce a fresh legislation incorporating the recommendations.


The Companies Bill, 2013, is organized as 29 chapters, 470 clauses and 7 scheduled. Here’s a look at some of its key highlights. (Courtesy: Corporate Professionals (India) Pvt Ltd)


  1. A private company can have a maximum of 200 members, up from 50 in the Companies Act, 1956.
  2. The concept of One Person Company introduced. It will be a private limited company.
  3. Concept of dormant companies introduced. It can be formed for a future project or to hold an asset or intellectual property.
  4. All companies to follow uniform financial year, running from April to March. Exceptions to be made only for certain companies with the approval of NCLT.
  5. All types of securities to be governed by the Bill.
  6. The Prospectus has to be more detailed.
  7. Money raised through a prospectus cannot be used for dealing in equity shares of another company. If a company changes terms of the prospectus or objects for which money is raised, it shall provide dissenting shareholders an exit opportunity.
  8. ‘Private placement‘ defined, with detailed provisions for such placement.
  9. Apart from existing shareholders, if the Company having share capital at any time proposes to increase its subscribed capital by issue of further shares, such shares may also be offered to employees by way of ESOP, subject to the approval of shareholders by way of Special Resolution.
  10. NBFCs not covered by the provisions relating to acceptance of deposits. They will be governed by Reserve Bank of India Rules.
  11. Companies can accept deposits only from its members, that too after obtaining shareholders approval. Acceptance of deposit also subject to compliance with certain conditions.
  12. Public companies can accept deposit from public on complying certain conditions like credit rating.


  1. Listed companies required to file a return in a prescribed form with the Registrar regarding any change in the number of shares held by promoters and top 10 shareholders of such company, within 15 days of such change.
  2. Postal Ballot to be applicable to all the companies, whether listed or unlisted.
  3. Interim dividend in a current financial cannot exceed the average rate of dividend of the preceding three years if a company has incurred loss up to the end of the quarter immediately preceding the declaration of such dividend.
  4. Financial statements include Balance Sheet, Profit & Loss Account and cash flow statements.
  5. Provisions for re-opening or re-casting of the books of accounts of a company provided.
  6. The National Advisory Committee on Accounting Standards renamed as The National Financial Reporting Authority.
  7. The authority to advise on Auditing Standards and Accounting Standards.


  1. Every company is required at its first annual general meeting (AGM) to appoint an individual or a firm as an auditor. The auditor shall hold office from the conclusion of that meeting till the conclusion of its sixth AGM and thereafter till the conclusion of every sixth meeting. The appointment of the auditor is to be ratified at every AGM.
  2. Individual auditors are to be compulsorily rotated every 5 years and audit firm every 10 years in listed companies & certain other classes of companies, as may be prescribed.
  3. Auditors have to comply with Auditing Standards.
  4. A company’s auditor shall not provide, directly or indirectly, the specified services to the company, its holding and subsidiary company.
  5. A partner or partners of the audit firm and the firm shall be jointly and severally responsible for the liability, whether civil or criminal, as provided in this Bill or in any other law for the time being in force. If it is proved that the partner or partners of the audit firm has or have acted in a fraudulent manner or abetted or colluded in any fraud by, or in relation to, the company or its directors or officers, then such partner or partners of the firm shall also be punishable in the manner provided in clause 447.


  1. Prescribed class or classes of companies are required to appoint at least one woman director.
  2. At least one director should be a person who has stayed in India for a total period of not less than 182 days in the previous calendar year.
  3. At least one-third of the total number of directors of a listed public company should be independent directors. Existing companies to get a transition period of one year to comply.
  4. Liability of independent directors and non-executive directors not being promoter or key managerial personnel to be limited.
  5. A person can hold directorship of up to 20 companies, of which not more than 10 can be public companies.


  1. Companies with more than 1,000 shareholders, debenture-holders, deposit-holders and any other security holders at any time during a financial year to constitute a Stakeholders Relationship Committee, with a non-executive director as a chairperson and such other members as may be decided by the board.
  2. No permission of central government required to give a loan to a director.
  3. The provisions on inter-corporate loans and investment (372A of Companies Act 1956) extended to include loan and investment to any person.
  4. A company cannot, unless otherwise prescribed, make investment through more than 2 layers of investment companies.
  5. No central government approval required for entering into any related party transactions.
  6. No central government approval required for appointment of any director or any other person to any office or place of profit in the company or its subsidiary.
  7. Prohibition on forward dealings in securities of company by any director or key managerial personnel.
  8. Prohibiting insider trading in the company.
  9. No compromise or arrangement shall be sanctioned by the Tribunal unless a certificate by the Company’s Auditor has been filed with the Tribunal to the effect that the accounting treatment, if any, proposed in the scheme of compromise or arrangement is in conformity with the accounting standards prescribed under clause 133.
  10. Creation of treasury stock/trust shares is prohibited.
  11. Every listed company or such class or classes of companies, as may be prescribed, to establish a vigil mechanism.
  12. The Bill makes provision for cross border amalgamations between Indian Companies and companies incorporated in the jurisdictions of such countries as may be notified from time to time by the Central Government.


  1. The Bill provides provisions related to Corporate Social Responsibility (CSR).
  2. The Bill provides for class action suit by specified number of members or depositors against the company except the banking company, which is prevalent in developed countries.
  3. The Bill provides for specific provisions related to any act of fraud.
  4. The process for declaring a company sick and its revival and rehabilitation has been rationalized.
  5. The National Company Law Appellate Tribunal shall now consist of a combination of technical and judicial members not exceeding 11, instead of 2 as provided in the Companies Act 1956.
  6. The Central Government may establish as many special courts as may be necessary to provide speedy trial of offences.
  7. The Central Government may establish a mediation and conciliation panel.
  8. The Bill makes provision for cross border amalgamations between Indian companies and companies incorporated in the jurisdictions of such countries as may be notified from time to time by the central government.
  9. Where any valuation is required to be made of any property, stocks, shares, debentures, securities or goodwill or any other assets or net worth of a company or its liabilities under the Act, it shall be valued by a registered valuer.




nagesh kini

3 years ago

Thank God! It's through at last.
It was deliberately delayed by the business and audit professions because of the stringent provisions that were going to affect them.
When will the next long awaited DTC see the light of the day?

Govt to introduce new bill to amend SEBI Act

Just last month, the government had promulgated an ordinance amending the securities law that would provide more powers to SEBI and plans to introduce a new bill to replace the ordinance in the ongoing Monsoon session

The Indian government on Thursday withdrew a bill to amend the Securities and Exchange Board of India (SEBI) Act ahead of introduction of a new bill that would give more powers to the market regulator.


Finance minister P Chidambaram proposed in the Lok Sabha to withdraw the bill, which was introduced in March this year, to amend the SEBI Act. The proposal was passed by the House.


The withdrawn bill was passed by the Rajya Sabha on 11th March and was tabled in the Lok Sabha the next day.


In July, President Pranab Mukherjee had promulgated an ordinance amending the securities law that would provide more powers to the capital market watchdog.


The government plans to introduce a new bill replacing the ordinance in the ongoing Monsoon session.


With amendments, SEBI would have more powers to crack down on ponzi schemes, access phone call records to check insider trading and carry out search and seizure operations.


Last month, the government had said promulgation of the ordinance demonstrated its firm commitment and resolve to act with speed and alacrity to curb irregularities and frauds in securities market.


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