BQuick On Feb. 26: Top 10 Stories In Under 10 Minutes

This is a roundup of the day’s top stories in brief.

1. Delhi Violence: Death Toll Rises To 24

The Delhi Police has arrested 106 people for their alleged involvement in the northeast Delhi violence and registered 18 first information reports, said a senior police officer.

• As many as 24 people have died due to the clashes in the past four days, PTI reported as of 7:45 p.m. on Wednesday.
• "No untoward incident was reported on Wednesday and PCR calls from northeast Delhi have reduced," Additional Commissioner of Police (Crime) Mandeep Singh Randhawa told reporters.
• Earlier in the day, National Security Adviser Ajit Doval held a meeting with senior officials of Delhi Police and took stock of the violence.
• Cautioning authorities that the 1984 anti-Sikh riots should not be allowed to be repeated, the Delhi High Court on Wednesday expressed "anguish" over the failure to register FIRs against those making alleged hate speeches including Kapil Mishra and others from the Bharatiya Janata Party and asked the Police Commissioner to take a "conscious decision" on this by Thursday.
• The apex court lashed out at the law enforcing agencies for allowing the "instigators of violence" to get away and said they should act as per law without waiting for somebody's nod.
• "If somebody makes an inflammatory remark, police has to take action," said a bench comprising Justices SK Kaul and KM Joseph.

Follow updates from the Delhi violence here.

2. Sensex Nosedives, U.S. Stocks Rise

Indian equities fell for the fourth consecutive trading session.

• The S&P BSE Sensex fell 0.97 percent or 392.24 points to end below the 40,000-mark.
• The 30-stock index has fallen over 1,400 points in the last four trading sessions.
• The NSE Nifty 50 fell 1.01 percent or 119.4 points to close below 11,700.
• All the 11 sectoral gauges compiled by NSE ended lower.

Follow the day’s trading action here.

U.S. equities opened higher while stocks in Europe and Asia remained under pressure as investors digested fresh evidence of the widening coronavirus outbreak.

• All three main American equity gauges were positive in the wake of more than 6 percent slide in the benchmark S&P 500 over the past two days.
• Ten-year Treasury yields lingered near the record-low close set Tuesday.
• President Donald Trump and federal health officials plan to brief the U.S. public Wednesday on efforts to prevent the spread of the coronavirus.
• Oil extended declines to the lowest in a year on fears the fast-spreading coronavirus will take a major toll on the global economy.

Get your daily fix of global markets here.

3. Damanis Go Against The Tide

Shares of the India Cements Ltd. beat analyst forecasts to surge more than 40 percent in two days to hit a seven-month high after the Damani family bought stake in the southern company expecting a turnaround.

• Billionaire Gopikishan Damani, younger brother of D-Mart supermarket chain founder Radhakishan Damani, picked up 2.8 percent stake in India Cements on Tuesday, according to disclosures to exchanges.
• The younger sibling purchased additional 2.7 percent equity on Wednesday, while Radhakishan Damani bought additional 0.9 percent equity, according to bulk deal data on the National Stock Exchange of India.
• That, according to BloombergQuint’s calculations, increased the siblings’ holding in the cement maker to 11.1 percent.

Only four of 14 analysts tracking the stock recommend a ‘Buy’.

4. Cipla Gets Regulatory Warning

Cipla Ltd. said it has received a “warning letter” from the U.S. drug regulator for its formulations plant in Goa.

• That comes after the U.S. Food and Drug Administration classified the plant as Official Action Initiated.
• The facility was inspected from Sept. 16-27 last year, according to an exchange filing by the drugmaker.
• As per the warning letter, Cipla may continue to sell existing drugs from the facility but newer approvals will be held by the regulator if corrective measures are not taken by the company.
• The plant, according to Kotak Securities, contributes around 30 percent to its U.S. sales.

Find out if there will be a financial impact on the company’s earnings.

5. Godrej’s Opportunistic Bet

India’s second-largest developer by market value plans to invest Rs 5,000-6,000 crore on buying land to make the most of the stress in the real estate sector.

• The company intends to deploy the capital in the next two-three years either through direct purchases or joint ventures involving land, Mohit Malhotra, managing director and chief executive officer at Godrej Properties Ltd., told BloombergQuint in an interview.
• We are following a counter-cyclical strategy in the market. We feel that the current distress environment presents a unique opportunity for good players like us,” Malhotra said.

Here’s why large companies like Godrej Properties have found an opportunity during the slowdown.

6. Saving Debenture Holders From A DHFL Repeat

Based on the negative experience of debenture holders of Dewan Housing Finance Corporation Ltd., the market regulator has proposed the creation of an identified charge, or underlying security, for bonds and debentures issued by non-banking finance companies, among other changes.

• In a discussion paper, Securities and Exchange Board of India has noted the difficulty in enforcing the security of underlying bonds/debentures issued by NBFCs in the event of a default.
• Secured debentures issued by manufacturing companies carry a fixed charge on tangible assets such as plant and machinery.
• But in the case of secured bonds issued by NBFCs, the charge is floating—created on loan receivables, which are dynamic and intangible in nature and often include the entire balance sheet of the company.
• In the event of a default, debenture trustees, that safeguard the interests of debenture holders, enforce the security.
• This is easier to do for manufacturing companies but has proven to be complicated in the recent past for NBFCs due to the lack of an identified security, the SEBI paper said.

Here’s what the market regulator has pointed out and proposed.

7. RBI’s Latest Attempt To Predict Twists And Turns

The Indian central bank, which failed to foresee the sharp fall in the country’s economic growth in 2019-20, is experimenting with a new model to strengthen its ability to catch twists and turns in the economy better.

• In its new model, the Reserve Bank of India adds financial indicators including the nominal effective exchange rate and the Sensex, along with non-food bank credit, to the list of data points already tracked.
• The extracted trend, the RBI said, provides a real-time assessment of the state of the economy and helps identify sectors contributing to economic fluctuations.
• The RBI so far used a six-indicator and a nine-indicator model that it used to provide an early estimate of GDP growth in a given quarter.
• In a working paper released on Tuesday, the central bank introduced a 12-indicator based approach.

Read more to see what are the indicators used in the new model and could it be effective in better forecasting.

8. The Trump-Modi Deal: Just A Business Contract

Has Donald Trump’s visit marked the end of both free and managed trade between the United States and India – at least for the foreseeable future, asks Raj Bhala.

• An Indo-American FTA would create trade between the two countries, and divert it from China.
• The two sides were unable to even strike a ‘Managed Trade Agreement’, as India did not push on points it has leverage.
• America and India are yet to see the other as a broad-based ally, akin to America and Japan, or America and Korea.

For now, Indo-American trade is purely contractual.

9. Will The Data Protection Law Lock Out Competition To Big Tech?

It would be a tragedy of sorts for the Indian government to stifle Indian startups in a bid to protect Indians from entrenched foreign data monopolies, writes Prashant Reddy.

• It is possible that the existing big data companies will cement their monopolies in India post the enactment of the data protection law.
• Is it fair to expect Indian startups to compete with existing monopolies that grew and flourished in an ecosystem where they were not restrained by data-protection laws?
• One solution is to rework the existing bill to ensure that the data protection law applies only to data companies that reach a particular threshold.

The next decade is about building the foundations of a data economy.

10. India Mints Three Billionaires A Month

India minted three billionaires every month as the nation’s stock markets surged to records despite a slowing economy.

• Asia’s third-largest economy added 34 new billionaires last year, jumping two spots to rank third with 138 ultra-rich persons after the U.S. and China, according to Hurun Global Rich List 2020.
• The number rises to 170 if Indian-origin billionaires are tallied in.
• That compares with 799 and 626 billionaires in China and the U.S., respectively — the top two spots that together make half of the billionaires in the world.
• The number of billionaires in the world rose to a record 2,817 in 2019 from 2,470 in the previous year.

Find out how the richest Indians stack up.