BQuick On April 1: Top 10 News Stories In Under 10 Minutes
Introducing Election Soundtrack, a daily podcast that’ll get you up to speed with everything that you need to know about Elections 2019.
Here is a roundup of the day’s top stories in brief.
1. Forex Swap 2.0
India’s central bank will conduct a $5 billion swap auction on April 23 after its success with the instrument last month, it said in a statement on Monday.
- The Reserve Bank of India received 240 bids worth $16.31 billion in the rare swap on March 26.
- The move to buy dollars and offer banks rupees in return helped inject liquidity into Asia’s third-largest economy in time for the surge in demand as the financial year closed on March 31.
- While the swap will bulk up India’s foreign-exchange reserves, there’s concern that using the forex swap may reduce the need for the central bank to buy debt from the market.
- The central bank last bought government bonds from the market on March 14.
The auction will be held between 9:30 a.m. to 11 a.m. on April 23.
2. GST Collections Hit Record High
Goods and services tax collection for February rose to its highest since the nationwide levy was rolled out in July 2017.
- The government’s collection rose about 9.5 percent month-on-month to Rs 1,06,577 crore for February, according to the Ministry of Finance.
- It jumped 15.6 percent from Rs 92,167 crore in the same month in 2018, it said.
- The mop-up crossed Rs 1 lakh crore for the third time in 2018-19.
- The average monthly collection this fiscal now stands at Rs 97,628 crore.
Does this mean GST collections are finally stabilising?
3. Sensex Hits 39,000, Dow Rallies
Indian equity benchmark—S&P BSE Sensex trimmed intraday gains after hitting a record high.
- The 31-share index ended 0.42 percent higher at 38,837, after rallying over 400 points to hit an all-time high at 39,115.
- The NSE Nifty 50 Index ended at 11,669, up 0.39 percent.
- The broader market index represented by the NSE Nifty 500 Index ended 0.4 percent higher.
- The market breadth was tilted in favour of buyers.
- Six out of 11 sectoral gauges compiled by NSE advanced.
Follow the day’s trading action here.
Stocks strengthened worldwide as strong manufacturing data out of the world’s second largest economy helped ease investor worries about a slowdown in global growth.
- Treasuries extended losses after as a gauge of U.S. factories topped estimates in March.
- The S&P 500, Dow and Nasdaq were all in the green. The Stoxx Europe 600 Index climbed on the heels of its best quarter in four years after key China manufacturing PMIs for March beat the highest estimate in Bloomberg surveys of economists, indicating an acceleration in a key auto market.
- That’s despite manufacturing data for Europe coming in at the lowest since 2013, which briefly caused the euro to pare some of its gains.
Get your daily fix of global markets here.
4. No Respite For Automakers
Sales for Indian automakers continued to remain weak in March despite a slew of discounts being offered across most vehicles.
- India's largest carmaker Maruti Suzuki India Ltd.’s sales fall the most in seven months to 1.58 lakh units.
- Car sales decline in the pre-election years and the same pattern is being followed currently, said RC Bhargava, its chairman, in an interview with BloombergQuint.
- Tata Motors Ltd. sales slipped 1 percent to 68,709 units.
- Mahindra & Mahindra Ltd.’s auto sales rose 1 percent last month while its tractor sales fell 31 percent.
- Ashok Leyland Ltd. sold 21,535 units last month, a decline of 4 percent.
Non-listed automakers like Honda and Toyota reported sales growth.
5. Airbnb Gets A Room In Oyo
Airbnb Inc. invested an undisclosed amount in Oyo Hotels & Homes as the world’s largest home-rental company partners with the Indian hospitality chain expanding at a breakneck pace.
- While Airbnb and Oyo didn’t disclose the amount, a person privy to the details told BloombergQuint that it’s around $150-200 million.
- As part of the strategic investment, Oyo’s listings will appear on the Airbnb platform, the person said seeking anonymity as the details are not public.
The partnership is not exclusive.
6. RBI Vs Kotak Battle Continues
The Bombay High Court denied interim relief for the third time to Kotak Mahindra Bank Ltd., urging its promoters to declare that they have complied with the Reserve Bank of India’s direction to dilute their shareholding.
- “If the promoters haven’t come forward to challenge the order, the RBI is bound to take action," said Justice AS Oka, leading a two-judge bench with Justice MS Sanklecha.
- The promoters were given time until April 22 to file an affidavit.
- Uday Kotak, as per the RBI’s timeline, needed to reduce his stake in the bank he founded to 20 percent by Dec. 31, 2018 and bring it down to 15 percent after May 2020.
Kotak owned 29.7 percent in the bank as of Dec. 31.
7. The Wait For CG Power’s Restructuring
CG Power and Industrial Solutions Ltd. restructured its business multiple times in the last six years, selling several of its assets including the crown jewel consumer appliances unit.
- But it continues to struggle with high debt. Yet, the maker of power transformers is now doing more of the same.
- The company, which contributes 65 percent of the sales of the Gautham Thapar-founded firm, will reorganise some of the overseas subsidiaries back into its operations after completing asset sales, merge one arm with itself, and convert private equity debt into equity, according to a March 8 statement.
- The move is aimed at shoring up investor sentiment amid concerns about debt and loans to the promoter group.
Here’s what went wrong at the Avantha Group company.
8. Warren Buffett’s Story Isn’t About Money
How much has Warren Buffett benefited from time, and not timing the market in his 54-year investment in Berkshire Hathaway? Vishal Khandelwal does the math and uncovers some staggering numbers.
- Let’s assume Buffett did not own Berkshire as an ‘owner’ but was rather an outside investor in the stock starting 1964.
- What if Buffett had tried to be “smarter” like most of us investors think we are, booked profits after the five best years in Berkshire’s history?
- Then what if Buffett had missed just these five years in his 54-year relationship with Berkshire?
Here’s what Khandelwal found.
9. Disconnects In India’s E-Commerce Policy
India’s e-commerce policy – contrary to its aim – risks making India an outcast in the emerging international digital class system, writes Raj Bhala.
- India risks trade action from the U.S., possibly China, and trouble at the WTO.
- The playing field is not level for poor or rich Indians, nor for foreigners.
- The government is not preventative, but protectionist.
Read the many tangles in India's e-commerce policy.
10. Facebook Cracks Down On 'Inauthentic’ Accounts
Facebook Inc. said it has removed “inauthentic” pages and accounts linked to the Indian National Congress and a software services company Silver Touch in a crackdown on spam.
- The social media giant—which has around 300 million users in India—removed 687 pages and accounts linked to the Congress due to “coordinated inauthentic behaviour”.
- “We’re taking down these Pages and accounts based on their behavior, not the content they posted,” it said, adding that in each case, the people coordinated with each another and used fake accounts.
- These pages had about about 206,000 followers and about $39,000 was spent for ads on Facebook.
- The social media giant had also removed 15 pages, groups and accounts that among other things, carried pro-BJP content, Facebook’s statement said citing posts.
The accounts were linked to individuals associated with an Indian IT firm Silver Touch.