Men sit reading newspapers at a relief camp set up at Sree Narayana College Cherthala, affiliated to the University of Kerala, in Alappuzha, Kerala, India (Photographer: Prashanth Vishwanathan/Bloomberg)  

BQuick On Dec. 27: Top 10 Stories In Under 10 Minutes

This is a roundup of the top stories of the day.

1. PSU Bank Recap

This is a developing story...

At least four public sector banks are set to receive additional capital from the government, as part of its augmented recapitalisation plan.

Bank of India is set to receive Rs 10,000 crore in capital, which is the highest among all banks in the current batch, according to a senior official of the bank speaking on conditions of anonymity.

Kolkata-based UCO Bank is set to receive Rs 3,076 crore, while Central Bank of India will receive Rs 1,648 crore, according to senior officials from both these banks.

United Bank of India told stock exchanges that it will receive Rs 2,159 crore from the government under the plan.

This capital will help public sector banks meet minimum capital requirements under Basel III and may also help them lend more. At least 11 public sector banks, including the four mentioned above, are under the prompt corrective action (PCA) framework of the Reserve Bank of India (RBI) and are facing lending restrictions, owing to their high bad loan ratios and weak capital base.

The full story will be up on soon.

2. No Private Labels For Big Box Too?

India’s retail traders’ lobby said not only e-commerce players such as Flipkart and Amazon but big-box retailers like Reliance Retail Ltd. also won’t be able to sell private labels online after the government barred e-commerce marketplaces from selling products of companies in which they own stake. Such products are commonly referred to as private labels.

“As per new norms, big-box companies like Reliance (Retail) can’t sell their products on their own platforms. They will not be able to give discounts and will not be able to adopt predatory pricing,” Praveen Khandelwal, president at Confederation of All India Traders Association, told BloombergQuint in an interview on Thursday.

They will not be able to have exclusivity.
Praveen Khandelwal, President, Confederation of All India Traders Association

Reliance Retail has yet to respond to BloombergQuint’s emailed queries.

Khandelwal said tighter e-commerce rules will help create a level-playing field.

Also read: No Private Labels, Exclusive Deals, Deep Discounts On E-Commerce Sites

3. Vodafone Refund Call Dropped By Court

Watch out India Inc! An amendment in the 2017 budget has empowered the tax department to delay refunds for years, writes noted tax expert Mukesh Butani.

Last week, the Delhi High Court delivered a judgment that rejected a plea by Vodafone Mobile Services Ltd.

Vodafone had asked the court to direct the Department of Revenue to issue four-years worth pending tax refunds due to it.

The revenue department successfully defended its actions by invoking relevant provisions to withhold refunds in situations where there is the likelihood of a demand on uncompleted assessments.

It succeeded because of two amendments in the 2017 Finance Act.

  • This outcome is adverse for business enterprises, in general.
  • The cumulative impact of the amendment seems to have caught taxpayers unaware of the consequences.

Read the full column here.

4. Indian Markets Rise, U.S. Markets Stumble

Indian equity benchmarks rose for second day in a row led by Reliance Industries, Infosys, TCS and Hindustan Unilever.

  • The Sensex rose 0.44 percent or 157 points to 35,807.
  • The NSE Nifty 50 Index advanced 0.47 percent or 50 points to 10,780.
  • Ten of 19 sector gauges compiled by BSE ended higher led by the S&P Information Technology Index’s 1.32 percent gain.
  • On the flipside, the S&P BSE Auto Index was top loser, down 0.37 percent.

Follow the day’s trading action here.

Also read: HDFC Group Briefly Overtakes Tata Group As India’s Largest

Meanwhile, volatility returned to U.S. markets, with stocks stumbling back toward a bear market after the biggest rally in nearly a decade faltered.

Oil and the dollar gave up some of the previous session’s advances. Oil slipped below $46 a barrel.

Follow all the U.S. market action here.

5. Best Mutual Funds Of 2018

In a volatile year for stocks, large-cap mutual fund schemes outperformed small- and mid-cap plans tracking the benchmark indices.

  • After an initial surge, the S&P BSE Sensex fell in the last few months of 2018. While it has since then managed to recoup losses, the broader Nifty Midcap 100 Index and Nifty Smallcap 100 Index plunged 17 percent and 30.5 percent, respectively.
  • That reflects in the returns mutual fund investors earned based on the net asset value of large-, medium- and small-cap schemes.

Sectoral and thematic funds or those focused outside of India weren’t considered.

One of the top performing fund schemes is Axis Blue Chip Fund - Direct Plan. Here’s the full list.

6. India’s Economy Is Picking Up Again?

India is showing signs of overcoming tight money conditions, with lending and business activity picking up in Asia’s third-largest economy.

  • An overall activity indicator measuring "animal spirits" moved two notches up in November from a month ago. The gauge, compiled by Bloomberg News, reflects strength in new orders boosting business activity, but more importantly a rebound in a liquidity indicator.
  • Consumer sentiment and demand remained subdued, but the government’s decision in December to slash taxes on some goods and services may help stoke an economy that saw expansion slow in the three months through September.
BQuick On Dec. 27: Top 10 Stories In Under 10 Minutes

Here’s more on business sentiments, exports and consumer activity.

7. Fiscal Deficit Hits 114.8% Of FY19 Target

India’s fiscal deficit continued to widen further in November after breaching the budgeted target for financial year 2018-19 last month.

  • Fiscal deficit—the gap between the government’s revenue and expenditure—stood at Rs 7.16 lakh crore at the end of November, according to data released by the Controller General of Accounts.
  • That’s 114.8 percent of the budgeted estimate of Rs 6.24 lakh crore for 2018-19.
  • The gap had stood at 112 percent in November last year.

The data raises questions on the government’s ability to meet its fiscal deficit target for the second year running.

8.Vedanta’s $8 Billion Plan

Vedanta Ltd. plans to invest $8 billion to expand production capacities over the next three years as part of its strategy to improve revenue and profitability, according to its Group Chairman Anil Agarwal.

  • “We are looking to make about $8 billion investment which includes 500,000 barrels of oil and to increase aluminium production by 1 million tonnes and zinc capacity by 800,000 tonne,” said Agarwal in an interaction with BloombergQuint.
  • The mining magnate also plans to expand the capacity of the newly-acquired Electrosteel Steels to 2.5 million tonnes at a cost of $300 million. India’s steel demand is around 300 million tonnes and currently, it’s producing only 70 million tonnes, he said.
It should be comfortable to manage the expansion as our income is expected to be around $25 billion over this investment period.
Anil Agarwal, Group Chairman, Vedanta

Watch the full interview with Agarwal here.

Also read: Government Has Prepared Revival Plan For Air India, Says Jayant Sinha

9. Court Vacations: Are They Justified?

  • Are judges overworked? Yes.
  • Do they deserve such long vacations? No.

No other wing of the government takes similar long breaks during the year, writes Daksh India's Harish Narasappa.

10. Flying To New York? We’ve Got A Drink For You

For the last 88 years, Zabar’s has been New York’s most high-profile deli, known for the quality of its smoked salmon and its array of cheeses. In 2018 it got into the cocktail business.

The cocktail program is ambitious, choreographed by rising-star mixologist Julia Momose, whose drinks include the Negroni-styled Nocino Notte, a mix of gin, Gran Classico bitter, and house cold brew.

BQuick On Dec. 27: Top 10 Stories In Under 10 Minutes