tag:blogger.com,1999:blog-84962390136292388792024-02-19T14:18:24.228+05:30Sun Capital Advisory Services Investment Bank supporting leading medium and large corporates in fund raising through Banks, NBFC, PE funds. Also provide NPA resolution for stressed cases.Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.comBlogger312125tag:blogger.com,1999:blog-8496239013629238879.post-70427780033137841932017-10-04T14:49:00.000+05:302017-10-04T15:17:40.814+05:30Factors to consider while financing the business<div dir="ltr" style="text-align: left;" trbidi="on">
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<b><u><span lang="EN-IN">Factors to consider while financing the business</span></u></b></h2>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;">Businesses today
exist in a new and different economic landscape that forces creativity and out
of box thinking and same is true while funding these businesses. Though there
are differ ways through which business can be funded but selecting a right
route for raising finance not only helps in reducing cost but also plays
crucial role in overall sustainability of the business.<o:p></o:p></span></span></div>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;">There are
numerous ways to finance a business and ample lenders and investors to choose
from but choosing Whom, When and How play a very important role.<o:p></o:p></span></span></div>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;">Financing can
come in the form of Debt and Equity and the terms of finance can vary
significantly between the two. Factors that are crucial while financing a
business include the Repayment terms, Total cost of capital and the requirement
of lender or Investor.<o:p></o:p></span></span></div>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;">Repayment terms
are very important to decide on how financial arrangement is structured. Longer
tenure loans can aggregate a significant amount of interest over the time but
loans with shorter tenure requires larger periodic payments. While raising
funds consider the amount of periodic payment, how often the payments need to
be made and how cash flow from the business supports the same.<o:p></o:p></span></span></div>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;">Total cost of
capital includes interest cost on loan, processing fees charged by lenders,
opportunity cost involved in case of collateral offered, professing fees
charged by professional agencies and other miscellaneous costs involved.
Consider all these costs while calculating IRR and choosing from available
options of funding. <o:p></o:p></span></span></div>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;">Money from
Investors may not require repayment for many years but investor may expect to
be repaid at a steep premium all at once.<o:p></o:p></span></span></div>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;">Understanding requirement of lenders or
Investors is very crucial while raising capital. Mismatch in delivery and
expectations can lead to complication between the business and lender or
investor and could lead to difficultly in raising further capital for the
business.<o:p></o:p></span></span></div>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;">Finance is life
line of any business. Regardless of whichever path one takes, choosing the
optimum way of funding plays very crucial role during business life cycle.
Businesses which are able to manage it well can go a long way and create a
great value for its shareholders, lender and investors. Therefore, always find
a viable funding solution that allows one to focus on business sustainability
and profitability.<o:p></o:p></span></span></div>
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<span style="font-family: "verdana" , sans-serif;"><span lang="EN-IN"></span></span></div>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;">-Vivek Sakharkar</span><o:p></o:p></span></div>
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<span lang="EN-IN"><span style="font-family: "verdana" , sans-serif;"><a href="http://www.suncapitalservices.co.in/">To Know more</a></span></span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-16900951727422739182017-10-04T14:37:00.001+05:302017-10-04T15:30:09.138+05:30<div dir="ltr" style="text-align: left;" trbidi="on">
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<b><u><span style="font-family: "times new roman" , "serif"; font-size: 11.0pt;">Can<span style="letter-spacing: .35pt;"> </span>Bitcoi<span style="letter-spacing: .05pt;">n</span>s <span style="letter-spacing: .15pt;"> </span>still<span style="letter-spacing: 2.35pt;">
</span>be<span style="letter-spacing: 1.05pt;"> </span>ignored?</span></u></b><br />
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<i><span style="font-size: 11.0pt;">“A<span style="letter-spacing: .5pt;"> </span>pessimist<span style="letter-spacing: .45pt;">
</span>sees<span style="letter-spacing: .2pt;"> </span>difficulty<span style="letter-spacing: 1.15pt;"> </span>in<span style="letter-spacing: .6pt;"> </span>every<span style="letter-spacing: .05pt;"> </span>opportunity<span style="letter-spacing: 1.55pt;"> </span>and<span style="letter-spacing: -.15pt;"> </span>an<span style="letter-spacing: -.1pt;"> </span>optimist<span style="letter-spacing: 1.05pt;">
</span><span style="letter-spacing: -.05pt; mso-font-width: 92%;">s</span>ees<span style="letter-spacing: .4pt;"> </span>opportun<span style="letter-spacing: .05pt;">i</span>ty<span style="letter-spacing: 1.6pt;"> </span>in<span style="letter-spacing: .6pt;"> </span>every difficulty”</span></i><span style="font-size: 11.0pt;"><o:p></o:p></span></div>
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<b>Asset<span style="letter-spacing: 2.05pt;"> </span>C<span style="letter-spacing: -.05pt; mso-font-width: 120%;">l</span><span style="letter-spacing: .05pt;">a</span>ss</b><o:p></o:p></div>
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<b>CAGR*<span style="letter-spacing: .35pt;"> </span>from<span style="letter-spacing: .95pt;"> </span>J<span style="letter-spacing: .05pt;">a</span>n<span style="letter-spacing: -.55pt;"> </span>20<span style="letter-spacing: .05pt;">0</span>9 to<span style="letter-spacing: .45pt;"> </span>Aug<span style="letter-spacing: 1.55pt;"> </span>2<span style="letter-spacing: .05pt;">0</span>17</b><o:p></o:p></div>
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Bank<span style="letter-spacing: 1.2pt;"> </span>FD<o:p></o:p></div>
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6<span style="letter-spacing: -.05pt;">.</span>5%<o:p></o:p></div>
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<span style="letter-spacing: -.05pt; mso-font-width: 105%;">G</span>o<span style="letter-spacing: .05pt; mso-font-width: 116%;">ld</span><o:p></o:p></div>
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<span style="letter-spacing: .05pt;">12%</span><o:p></o:p></div>
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<span style="letter-spacing: .05pt; mso-font-width: 110%;">Nif</span><span style="letter-spacing: -.05pt; mso-font-width: 110%;">t</span>y<o:p></o:p></div>
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<span style="letter-spacing: .05pt;">19%</span><o:p></o:p></div>
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<span style="letter-spacing: -.05pt; mso-font-width: 95%;">B</span><span style="letter-spacing: .05pt; mso-font-width: 95%;">i</span><span style="letter-spacing: -.05pt; mso-font-width: 107%;">tco</span>in<o:p></o:p></div>
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<span style="letter-spacing: .05pt;">1</span><span style="letter-spacing: -.05pt;">24</span><span style="letter-spacing: .05pt;">7</span>%</div>
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<i><span style="font-family: "times new roman" , "serif"; font-size: 10.0pt;">*CAGR<span style="letter-spacing: .55pt;"> </span>– C<span style="letter-spacing: -.05pt;">om</span><span style="letter-spacing: .05pt;">p</span>ou<span style="letter-spacing: -.05pt;">n</span><span style="letter-spacing: .05pt;">d</span><span style="letter-spacing: -.05pt;">e</span>d<span style="letter-spacing: -.15pt;"> </span>An<span style="letter-spacing: -.05pt;">nu</span>al<span style="letter-spacing: 2.2pt;"> </span>Gr<span style="letter-spacing: -.05pt;">o</span>w<span style="letter-spacing: -.05pt;">t</span>h<span style="letter-spacing: .5pt;"> </span>Ra<span style="letter-spacing: -.05pt;">t</span>e</span></i></div>
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<span style="font-family: "verdana" , sans-serif;">On<span style="letter-spacing: 2.05pt;"> </span>August<span style="letter-spacing: .2pt;"> </span>3<span style="letter-spacing: .05pt;">1</span>,<span style="letter-spacing: .5pt;"> </span><span style="letter-spacing: .05pt;">2</span>01<span style="letter-spacing: .05pt;">6</span>,<span style="letter-spacing: .55pt;"> </span>Nif<span style="letter-spacing: -.05pt;">t</span>y <span style="letter-spacing: .3pt;"> </span>w<span style="letter-spacing: .05pt;">a</span>s <span style="letter-spacing: .05pt;">a</span>t<span style="letter-spacing: 1.55pt;"> </span><span style="letter-spacing: .05pt;">8</span>80<span style="letter-spacing: .05pt;">0</span>.<span style="letter-spacing: .55pt;"> </span>Currentl<span style="letter-spacing: -.05pt;">y</span>,<span style="letter-spacing: .7pt;"> </span>it<span style="letter-spacing: 1.1pt;">
</span>is<span style="letter-spacing: 1.1pt;"> </span>9900,<span style="letter-spacing: .55pt;"> </span>ri<span style="letter-spacing: -.05pt;">d</span>i<span style="letter-spacing: -.05pt;">n</span>g<span style="letter-spacing: .25pt;"> </span>on<span style="letter-spacing: 1.85pt;">
</span>bullish <span style="letter-spacing: 1pt;"> </span>sentiments<span style="letter-spacing: .25pt;"> </span>a<span style="letter-spacing: -.05pt;">n</span>d
a<span style="letter-spacing: 1.15pt;"> </span>strong<span style="letter-spacing: .25pt;"> </span>r<span style="letter-spacing: -.05pt;">e</span>form-
oriented<span style="letter-spacing: -.3pt;"> </span>BJP<span style="letter-spacing: -.7pt;"> </span>government,<span style="letter-spacing: -.35pt;"> </span>giving
<span style="letter-spacing: .3pt;"> </span>a<span style="letter-spacing: .6pt;"> </span>return<span style="letter-spacing: -.4pt;"> </span>of<span style="letter-spacing: .35pt;">
</span>1<span style="letter-spacing: .05pt;">2</span>.<span style="letter-spacing: .05pt;">5</span>%<span style="letter-spacing: .1pt;"> </span>p.<span style="letter-spacing: .05pt;">a</span>.<span style="letter-spacing: 1.6pt;"> </span>Impressive!!<o:p></o:p></span></div>
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<span style="font-family: "verdana" , sans-serif;">Bi<span style="letter-spacing: -.05pt;">t</span>coin<span style="letter-spacing: 1.55pt;"> </span>h<span style="letter-spacing: -.05pt;">a</span>s<span style="letter-spacing: 1.8pt;"> </span>r<span style="letter-spacing: -.05pt;">i</span>sen<span style="letter-spacing: 2.35pt;"> </span>from<span style="letter-spacing: 2.25pt;"> </span><span style="letter-spacing: -.05pt;">5</span><span style="letter-spacing: .05pt;">7</span><span style="letter-spacing: -.05pt;">5</span>$<span style="letter-spacing: .15pt;"> </span><span style="letter-spacing: -.05pt;">t</span>o<span style="letter-spacing: 1.05pt;"> </span>4<span style="letter-spacing: -.05pt;">6</span>0<span style="letter-spacing: -.05pt;">0</span>$<span style="letter-spacing: .15pt;"> </span>in<span style="letter-spacing: 1.1pt;"> </span><span style="letter-spacing: -.05pt;">t</span>he<span style="letter-spacing: 1.75pt;"> </span>same<span style="letter-spacing: 2.45pt;"> </span><span style="letter-spacing: -.05pt;">t</span>ime<span style="letter-spacing: 2.1pt;"> </span>fram<span style="letter-spacing: -.05pt;">e</span>, <span style="letter-spacing: .25pt;"> </span>pos<span style="letter-spacing: -.05pt;">t</span>i<span style="letter-spacing: -.05pt;">n</span>g<span style="letter-spacing: .05pt;"> </span>a<span style="letter-spacing: .7pt;">
</span>s<span style="letter-spacing: -.05pt;">t</span>a<span style="letter-spacing: -.05pt;">g</span>geri<span style="letter-spacing: -.05pt;">n</span>g<span style="letter-spacing: -.6pt;"> </span>re<span style="letter-spacing: -.05pt;">t</span>urn<span style="letter-spacing: .6pt;"> </span>of<span style="letter-spacing: .55pt;">
</span><span style="letter-spacing: -.05pt;">70</span><span style="letter-spacing: .05pt;">0</span>%.<span style="letter-spacing: .15pt;"> </span>Tha<span style="letter-spacing: -.05pt;">t</span>’s<span style="letter-spacing: .15pt;"> </span><span style="letter-spacing: -.05pt;">5</span>5<span style="letter-spacing: .1pt;"> </span><span style="letter-spacing: -.05pt; mso-font-width: 117%;">t</span>imes <span style="letter-spacing: -.05pt;">t</span>he<span style="letter-spacing: 1.65pt;"> </span>re<span style="letter-spacing: -.05pt;">t</span>urn<span style="letter-spacing: -.3pt;"> </span>on<span style="letter-spacing: 1.25pt;"> </span><span style="letter-spacing: -.05pt;">t</span>he<span style="letter-spacing: 1.65pt;"> </span>s<span style="letter-spacing: -.05pt;">t</span>ock<span style="letter-spacing: 1.8pt;"> </span>m<span style="letter-spacing: -.05pt;">a</span><span style="letter-spacing: -.05pt; mso-font-width: 118%;">r</span>ke<span style="letter-spacing: -.05pt;">t</span>! Do<span style="letter-spacing: 1.0pt;"> </span>you<span style="letter-spacing: 1.95pt;"> </span><span style="letter-spacing: -.05pt;">st</span>ill<span style="letter-spacing: 1.25pt;"> </span><span style="letter-spacing: -.05pt;">th</span>ink
<span style="letter-spacing: .3pt;"> </span><span style="letter-spacing: -.05pt;">t</span>he<span style="letter-spacing: 1.6pt;"> </span>bi<span style="letter-spacing: -.05pt;">t</span>coin <span style="letter-spacing: .05pt;"> </span><span style="letter-spacing: -.05pt;">c</span><span style="letter-spacing: .05pt;">a</span>n<span style="letter-spacing: 1.4pt;"> </span>be<span style="letter-spacing: .8pt;"> </span>ignor<span style="letter-spacing: -.05pt;">e</span>d?<o:p></o:p></span></div>
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<span style="font-family: "verdana" , sans-serif;"><br /></span></div>
<div class="MsoNormal" style="line-height: 107%; margin: 0cm 3.3pt 0.0001pt 5.55pt; text-align: left;">
<span style="font-family: "verdana" , sans-serif;">When
<span style="letter-spacing: .85pt;"> </span><span style="letter-spacing: -.05pt;">b</span>i<span style="letter-spacing: -.05pt;">t</span>coin
<span style="letter-spacing: .85pt;"> </span>was
<span style="letter-spacing: .45pt;"> </span>found<span style="letter-spacing: .6pt;"> </span><span style="letter-spacing: -.05pt;">i</span>n<span style="letter-spacing: 1.85pt;"> </span>2<span style="letter-spacing: -.05pt;">0</span>0<span style="letter-spacing: -.05pt;">9</span>,<span style="letter-spacing: .95pt;"> </span>Nan<span style="letter-spacing: -.05pt;">d</span>an<span style="letter-spacing: 1.65pt;"> </span>Nile<span style="letter-spacing: -.05pt;">k</span><span style="letter-spacing: .05pt;">a</span>ni<span style="letter-spacing: .15pt;"> </span>was <span style="letter-spacing: .45pt;"> </span>still<span style="letter-spacing: 2.15pt;"> </span>ser<span style="letter-spacing: -.1pt;">v</span>ing<span style="letter-spacing: .65pt;"> </span>his<span style="letter-spacing: 2.2pt;"> </span>first
<span style="letter-spacing: -.05pt;">st</span>int <span style="letter-spacing: .7pt;"> </span>as<span style="letter-spacing: 1.85pt;"> </span>Chai<span style="letter-spacing: -.05pt;">r</span>man<span style="letter-spacing: .7pt;"> </span>of<span style="letter-spacing: 1.35pt;"> </span><span style="letter-spacing: -.05pt;">t</span>he
<span style="letter-spacing: .05pt;"> </span>IT<span style="letter-spacing: .95pt;"> </span>giant Infosy<span style="letter-spacing: -.05pt;">s</span>, <span style="letter-spacing: .65pt;"> </span>Vi<span style="letter-spacing: -.05pt;">r</span>at<span style="letter-spacing: 2.4pt;"> </span>Kohli<span style="letter-spacing: 2.45pt;"> </span><span style="letter-spacing: -.1pt;">w</span><span style="letter-spacing: -.05pt;">a</span>s
<span style="letter-spacing: .35pt;"> </span><span style="letter-spacing: -.05pt;">y</span>et<span style="letter-spacing: 2.2pt;"> </span>to<span style="letter-spacing: 1.8pt;"> </span>make <span style="letter-spacing: .95pt;"> </span><span style="letter-spacing: -.05pt;">hi</span>s<span style="letter-spacing: 2.15pt;"> </span>test
debut<span style="letter-spacing: .4pt;">
</span>and Rah<span style="letter-spacing: -.05pt;">u</span>l
Gandhi<span style="letter-spacing: .5pt;"> </span><span style="letter-spacing: -.1pt;">w</span><span style="letter-spacing: .05pt;">a</span>s
<span style="letter-spacing: .35pt;"> </span>the<span style="letter-spacing: 2.4pt;"> </span>blu<span style="letter-spacing: -.05pt;">e</span>-ey<span style="letter-spacing: -.05pt;">e</span>d<span style="letter-spacing: .6pt;"> </span><span style="letter-spacing: -.1pt;">b</span>oy<span style="letter-spacing: 2.35pt;"> </span>of<span style="letter-spacing: 1.25pt;"> </span>Con<span style="letter-spacing: -.05pt;">g</span>r<span style="letter-spacing: -.05pt;">e</span>ss<span style="letter-spacing: .65pt;"> </span>and future<span style="letter-spacing: .2pt;"> </span>superstar<span style="letter-spacing: .3pt;">
</span>of<span style="letter-spacing: 1.1pt;"> </span>Indian<span style="letter-spacing: .25pt;"> </span>politics!
<span style="letter-spacing: .15pt;"> </span></span><br />
<span style="font-family: "verdana" , sans-serif;">It<span style="letter-spacing: 1.15pt;"> </span><span style="letter-spacing: -.05pt;">ha</span>s<span style="letter-spacing: 2.4pt;"> </span>been <span style="letter-spacing: .15pt;"> </span>alm<span style="letter-spacing: -.05pt;">o</span>st
<span style="letter-spacing: 1.2pt;"> </span>a<span style="letter-spacing: 1.15pt;"> </span>decade<span style="letter-spacing: .3pt;"> </span>si<span style="letter-spacing: -.05pt;">n</span>ce<span style="letter-spacing: 2.35pt;"> </span>incep<span style="letter-spacing: -.05pt;">t</span>io<span style="letter-spacing: -.05pt;">n</span>,<span style="letter-spacing: .55pt;"> </span>yet<span style="letter-spacing: 2.05pt;"> </span>the<span style="letter-spacing: 2.3pt;"> </span>#4<span style="letter-spacing: 1.7pt;"> </span><span style="letter-spacing: -.1pt;">m</span>ost
<span style="letter-spacing: .45pt;"> </span>s<span style="letter-spacing: -.05pt;">e</span>arched<span style="letter-spacing: .55pt;"> </span>que<span style="letter-spacing: -.05pt;">r</span>y
on<span style="letter-spacing: 1.3pt;"> </span>Google(2014)<span style="letter-spacing: 2.2pt;"> </span><span style="letter-spacing: .05pt;">“</span><b>W<span style="letter-spacing: -.05pt;">ha</span>t<span style="letter-spacing: 1.1pt;"> </span>is<span style="letter-spacing: .95pt;"> </span>Bitc<span style="letter-spacing: -.05pt;">o</span>in<span style="letter-spacing: -.1pt;">?</span></b>”<span style="letter-spacing: 2.3pt;"> </span>still<span style="letter-spacing: 1.25pt;"> </span>puz<span style="letter-spacing: .05pt;">z</span>les<span style="letter-spacing: .7pt;"> </span>most!<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: 12.0pt; margin-top: .45pt; mso-line-height-rule: exactly;">
<span style="font-family: "verdana" , sans-serif;"><br /></span></div>
<div class="MsoNormal" style="margin: 0cm 57.05pt 0.0001pt 5.55pt; text-align: left;">
<span style="font-family: "verdana" , sans-serif;">Bitcoin<span style="letter-spacing: 1.4pt;"> </span>is<span style="letter-spacing: .4pt;"> </span>a<span style="letter-spacing: .55pt;"> </span>decentralized,<span style="letter-spacing: -.9pt;"> </span>paper<span style="letter-spacing: .05pt;">l</span><span style="letter-spacing: -.05pt;">e</span>ss<span style="letter-spacing: .05pt;"> </span><span style="letter-spacing: -.05pt;">c</span>r<span style="letter-spacing: -.05pt;">y</span>pto-currency<span style="letter-spacing: -.75pt;"> </span>invented<span style="letter-spacing: .4pt;">
</span>by<span style="letter-spacing: 1.1pt;"> </span>an<span style="letter-spacing: 1.3pt;"> </span>anonym<span style="letter-spacing: -.05pt;">o</span>us programm<span style="letter-spacing: -.05pt;">e</span>r<span style="letter-spacing: .3pt;"> </span>in<span style="letter-spacing: .9pt;"> </span>2009.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: 107%; margin: 0.9pt 3.35pt 0.0001pt 5.55pt; text-align: left;">
<span style="font-family: "verdana" , sans-serif;">Bitcoins<span style="letter-spacing: 1.9pt;"> </span>are<span style="letter-spacing: 1.75pt;"> </span><span style="letter-spacing: -.1pt;">p</span>ieces<span style="letter-spacing: 2.45pt;"> </span><span style="letter-spacing: -.05pt;">o</span>f<span style="letter-spacing: .8pt;"> </span>computer code<span style="letter-spacing: 2.2pt;"> </span>--<span style="letter-spacing: .25pt;"> </span>mathemati<span style="letter-spacing: -.05pt;">c</span>al<span style="letter-spacing: 1.0pt;"> </span>alg<span style="letter-spacing: -.05pt;">o</span>rithms,<span style="letter-spacing: .55pt;"> </span>actu<span style="letter-spacing: .05pt;">a</span><span style="letter-spacing: -.05pt;">l</span>ly<span style="letter-spacing: .3pt;"> </span>--<span style="letter-spacing: .35pt;"> </span>th<span style="letter-spacing: .05pt;">a</span>t
<span style="letter-spacing: .05pt;"> </span>represent monet<span style="letter-spacing: .05pt;">a</span>ry<span style="letter-spacing: .05pt;"> </span>uni<span style="letter-spacing: -.05pt;">t</span>s. <span style="letter-spacing: .5pt;"> </span>They need
<span style="letter-spacing: .45pt;"> </span>no<span style="letter-spacing: 1.6pt;"> </span>middle<span style="letter-spacing: -.05pt;"> </span>man <span style="letter-spacing: .2pt;"> </span>to<span style="letter-spacing: 1.25pt;"> </span>transfer the<span style="letter-spacing: 1.9pt;"> </span>funds. Unlike
<span style="letter-spacing: .2pt;"> </span>modern<span style="letter-spacing: -.05pt;"> </span>fiat<span style="letter-spacing: 1.5pt;"> </span>money, Bitcoins<span style="letter-spacing: 2.1pt;"> </span>not<span style="letter-spacing: 2.1pt;"> </span>cont<span style="letter-spacing: .05pt;">r</span>olled<span style="letter-spacing: .35pt;"> </span>or<span style="letter-spacing: 1.4pt;">
</span>ba<span style="letter-spacing: -.05pt;">ck</span>ed<span style="letter-spacing: .3pt;"> </span>by<span style="letter-spacing: 1.4pt;">
</span>any bank or<span style="letter-spacing: 2.6px;"> </span><span style="letter-spacing: -.05pt;">c</span>en<span style="letter-spacing: -.05pt;">t</span>ral governm<span style="letter-spacing: -.05pt;">e</span>nt<span style="letter-spacing: .95pt;"> </span>au<span style="letter-spacing: -.05pt;">t</span>hori<span style="letter-spacing: -.05pt;">ty</span>,<span style="letter-spacing: 1.0pt;"> </span>like<span style="letter-spacing: 2.0pt;"> </span><span style="letter-spacing: -.05pt;">t</span>he <span style="letter-spacing: -.05pt;">R</span>BI.<span style="letter-spacing: .2pt;"> </span>You<span style="letter-spacing: 1.8pt;"> </span>don‘t
<span style="letter-spacing: .7pt;"> </span>have
<span style="letter-spacing: .65pt;"> </span>to<span style="letter-spacing: 1.8pt;"> </span><span style="letter-spacing: .05pt;">a</span><span style="letter-spacing: -.05pt;">s</span>k<span style="letter-spacing: 2.35pt;"> </span><span style="letter-spacing: .05pt; mso-font-width: 113%;">a</span><span style="letter-spacing: -.05pt; mso-font-width: 113%;">n</span>ybody<span style="letter-spacing: .7pt;"> </span>to<span style="letter-spacing: 2.4px;"> </span>use bitcoin. There is<span style="letter-spacing: 1.73333px;"> </span>no gatekeep<span style="letter-spacing: -.05pt;">e</span>r.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: 13.0pt; margin-top: 1.0pt; mso-line-height-rule: exactly;">
<span style="font-family: "verdana" , sans-serif;"><br /></span></div>
<div class="MsoNormal" style="line-height: 107%; margin: 0cm 3.35pt 0.0001pt 5.55pt; text-align: left;">
<span style="font-family: "verdana" , sans-serif;">Tran<span style="letter-spacing: -.05pt;">s</span><span style="letter-spacing: .05pt;">a</span>c<span style="letter-spacing: -.05pt;">t</span>ion<span style="letter-spacing: .05pt;"> </span><span style="letter-spacing: -.05pt;">a</span>re<span style="letter-spacing: 1.8pt;"> </span>propa<span style="letter-spacing: -.05pt;">g</span>a<span style="letter-spacing: -.05pt;">te</span>d<span style="letter-spacing: 1.25pt;"> </span>nea<span style="letter-spacing: -.05pt;">r</span>ly<span style="letter-spacing: .1pt;"> </span>i<span style="letter-spacing: -.05pt;">n</span>s<span style="letter-spacing: -.05pt;">ta</span>n<span style="letter-spacing: -.05pt;">t</span>ly<span style="letter-spacing: .15pt;"> </span>in<span style="letter-spacing: 1.2pt;">
</span><span style="letter-spacing: -.05pt;">t</span>he<span style="letter-spacing: 1.9pt;"> </span>n<span style="letter-spacing: -.05pt;">et</span>work and <span style="letter-spacing: .2pt;"> </span>a<span style="letter-spacing: -.05pt;">r</span>e<span style="letter-spacing: 1.8pt;"> </span>confirm<span style="letter-spacing: -.05pt;">e</span>d<span style="letter-spacing: .1pt;"> </span><span style="letter-spacing: -.05pt;">i</span>n<span style="letter-spacing: 1.15pt;"> </span>a<span style="letter-spacing: .85pt;"> </span>coup<span style="letter-spacing: -.05pt;">l</span>e<span style="letter-spacing: .1pt;"> </span>of<span style="letter-spacing: .65pt;"> </span>minu<span style="letter-spacing: -.05pt;">t</span>es. It<span style="letter-spacing: .7pt;"> </span>doesn't m<span style="letter-spacing: .05pt;">a</span>tter<span style="letter-spacing: -.2pt;"> </span>if<span style="letter-spacing: .15pt;">
</span>I<span style="letter-spacing: .05pt;"> </span>send <span style="letter-spacing: .05pt;"> </span>B<span style="letter-spacing: .05pt;">i</span>tcoins<span style="letter-spacing: 1.75pt;"> </span>to<span style="letter-spacing: .9pt;"> </span>my<span style="letter-spacing: 1.55pt;"> </span>neighbor<span style="letter-spacing: -0.2pt;"> </span>or<span style="letter-spacing: 1.1pt;"> </span>to<span style="letter-spacing: .95pt;"> </span>someone<span style="letter-spacing: -.25pt;"> </span>on<span style="letter-spacing: 1.1pt;"> </span>the<span style="letter-spacing: 1.6pt;"> </span>other
<span style="letter-spacing: .15pt;"> </span>s<span style="letter-spacing: .05pt;">i</span>de<span style="letter-spacing: 1.9pt;"> </span>of<span style="letter-spacing: .45pt;"> </span>the<span style="letter-spacing: 1.55pt;"> </span>world,<span style="letter-spacing: -.05pt;"> </span>it<span style="letter-spacing: .6pt;"> </span>will<span style="letter-spacing: 1.5pt;"> </span>t<span style="letter-spacing: .05pt;">a</span>ke<span style="letter-spacing: 1.85pt;"> </span>the<span style="letter-spacing: 1.55pt;"> </span>s<span style="letter-spacing: .05pt;">a</span>me<span style="letter-spacing: 2.25pt;"> </span>time!<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: 14.0pt; margin-top: .1pt; mso-line-height-rule: exactly;">
<span style="font-family: "verdana" , sans-serif;"><br /></span></div>
<div class="MsoNormal" style="line-height: 107%; margin: 0cm 3.3pt 0.0001pt 5.55pt; text-align: left;">
<span style="font-family: "verdana" , sans-serif;">One
<span style="letter-spacing: 1.85pt;"> </span>of
<span style="letter-spacing: .4pt;"> </span><span style="letter-spacing: -.05pt;">t</span>he <span style="letter-spacing: 1.65pt;"> </span>limi<span style="letter-spacing: -.05pt;">t</span>a<span style="letter-spacing: -.05pt;">t</span>io<span style="letter-spacing: -.05pt;">n</span>s<span style="letter-spacing: 2.65pt;"> </span>of
<span style="letter-spacing: .35pt;"> </span>bi<span style="letter-spacing: -.05pt;">t</span>coin
<span style="letter-spacing: .05pt;"> </span>is <span style="letter-spacing: .45pt;"> </span><span style="letter-spacing: -.05pt;">t</span>hat
<span style="letter-spacing: 2.25pt;"> </span>once
<span style="letter-spacing: 1.5pt;"> </span>a
<span style="letter-spacing: .6pt;"> </span><span style="letter-spacing: -.05pt; mso-font-width: 110%;">t</span>ran<span style="letter-spacing: -.05pt;">s</span><span style="letter-spacing: .05pt;">a</span>c<span style="letter-spacing: -.05pt;">t</span>io<span style="letter-spacing: -.05pt;">n</span>s <span style="letter-spacing: .15pt;"> </span>veri<span style="letter-spacing: -.05pt;">f</span>ied<span style="letter-spacing: 2.4pt;"> </span>by <span style="letter-spacing: 1.1pt;"> </span>ne<span style="letter-spacing: -.05pt;">t</span>work<span style="letter-spacing: -.3pt;"> </span>nodes<span style="letter-spacing: -.3pt;"> </span>and reco<span style="letter-spacing: -.05pt;">r</span>d<span style="letter-spacing: -.05pt;">e</span>d<span style="letter-spacing: 2.25pt;"> </span>in
<span style="letter-spacing: .95pt;"> </span>a public <span style="letter-spacing: .2pt;"> </span>d<span style="letter-spacing: -.05pt;">i</span>s<span style="letter-spacing: -.05pt;">t</span>ri<span style="letter-spacing: -.1pt;">b</span>u<span style="letter-spacing: -.05pt;">t</span>ed<span style="letter-spacing: 2.25pt;"> </span>le<span style="letter-spacing: -.05pt;">d</span>ger<span style="letter-spacing: .6pt;"> </span><span style="letter-spacing: -.05pt;">(b</span>lockch<span style="letter-spacing: -.05pt;">a</span>in<span style="letter-spacing: -.05pt;">)</span>,<span style="letter-spacing: -1.0pt;"> </span>nobody<span style="letter-spacing: 1.05pt;">
</span>can<span style="letter-spacing: 1.5pt;"> </span><span style="letter-spacing: -.05pt; mso-font-width: 111%;">r</span>everse<span style="letter-spacing: -.05pt;"> </span>i<span style="letter-spacing: -.05pt;">t</span>.<span style="letter-spacing: .65pt;"> </span>There<span style="letter-spacing: 2.15pt;"> </span>is<span style="letter-spacing: .6pt;"> </span>no<span style="letter-spacing: 1.3pt;"> </span>safety<span style="letter-spacing: 2.35pt;">
</span>net.<span style="letter-spacing: 1.65pt;"> </span>However,<span style="letter-spacing: -.25pt;"> </span>cryptogr<span style="letter-spacing: .05pt;">a</span>phy<span style="letter-spacing: .75pt;"> </span><span style="letter-spacing: .05pt; mso-font-width: 113%;">a</span>nd the
<span style="letter-spacing: .3pt;"> </span>magic
<span style="letter-spacing: .9pt;"> </span><span style="letter-spacing: -.05pt;">o</span>f<span style="letter-spacing: 1.7pt;"> </span>big<span style="letter-spacing: 2.35pt;"> </span>numbers<span style="letter-spacing: .8pt;"> </span>makes <span style="letter-spacing: 1.45pt;"> </span>it<span style="letter-spacing: 1.8pt;"> </span>al<span style="letter-spacing: -.1pt;">m</span>ost<span style="letter-spacing: 1.35pt;"> </span>impossi<span style="letter-spacing: -.1pt;">b</span><span style="letter-spacing: -.05pt;">l</span>e<span style="letter-spacing: 1.1pt;"> </span>to<span style="letter-spacing: 2.15pt;">
</span>break this schem<span style="letter-spacing: -.05pt;">e</span>.
A<span style="letter-spacing: 1.65pt;"> </span>Bitcoin <span style="letter-spacing: .15pt;"> </span>add<span style="letter-spacing: -.05pt;">r</span>ess<span style="letter-spacing: 1.0pt;"> </span>is<span style="letter-spacing: 1.65pt;"> </span>more secure
<span style="letter-spacing: -.05pt;">th</span><span style="letter-spacing: .05pt;">a</span>n <span style="letter-spacing: -.05pt;">T</span><span style="letter-spacing: .05pt;">i</span><span style="letter-spacing: -.05pt;">h</span><span style="letter-spacing: .05pt;">a</span>r<span style="letter-spacing: 2.05pt;"> </span>J<span style="letter-spacing: -.05pt; mso-font-width: 113%;">a</span><span style="letter-spacing: -.05pt; mso-font-width: 105%;">i</span>l.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: 14.0pt; mso-line-height-rule: exactly;">
<span style="font-family: "verdana" , sans-serif;"><br /></span></div>
<div class="MsoNormal" style="line-height: 107%; margin: 0cm 3.35pt 0.0001pt 5.55pt; text-align: left;">
<span style="font-family: "verdana" , sans-serif;">The <span style="letter-spacing: .45pt;"> </span>biggest <span style="letter-spacing: 2.2pt;"> </span>concern<span style="letter-spacing: 1.6pt;"> </span>of<span style="letter-spacing: 2.2pt;"> </span>r<span style="letter-spacing: -.05pt;">e</span>gu<span style="letter-spacing: -.05pt;">l</span><span style="letter-spacing: .05pt;">a</span><span style="letter-spacing: -.05pt;">t</span>ory<span style="letter-spacing: 1.85pt;"> </span><span style="letter-spacing: -.05pt;">a</span>u<span style="letter-spacing: -.1pt;">t</span>hori<span style="letter-spacing: -.05pt;">t</span>ies<span style="letter-spacing: 1.7pt;"> </span>is<span style="letter-spacing: 2.3pt;">
</span><span style="letter-spacing: -.05pt;">t</span>hat <span style="letter-spacing: 1.6pt;"> </span>neither<span style="letter-spacing: 2.0pt;"> </span>transactio<span style="letter-spacing: -.05pt;">n</span>s<span style="letter-spacing: 1.95pt;"> </span>nor
<span style="letter-spacing: 1.15pt;"> </span>accounts<span style="letter-spacing: 1.55pt;"> </span>a<span style="letter-spacing: -.05pt;">r</span>e connected<span style="letter-spacing: 1.55pt;"> </span>to <span style="letter-spacing: .25pt;"> </span>real world<span style="letter-spacing: 2.15pt;"> </span>identi<span style="letter-spacing: -.1pt;">t</span>ies.<span style="letter-spacing: 1.1pt;"> </span><span style="letter-spacing: -.05pt;">A</span>s
<span style="letter-spacing: .5pt;"> </span>s<span style="letter-spacing: -.1pt;">t</span>ated<span style="letter-spacing: 1.8pt;"> </span>by<span style="letter-spacing: 1.05pt;">
</span>F<span style="letter-spacing: -.05pt;">o</span>rmer<span style="letter-spacing: 1.9pt;"> </span>Indian<span style="letter-spacing: 2.65pt;">
</span><span style="letter-spacing: -.05pt;">M</span>inister<span style="letter-spacing: 1.8pt;"> </span>of <span style="letter-spacing: .05pt;"> </span>S<span style="letter-spacing: -.1pt;">t</span>ate <span style="letter-spacing: 1.1pt;"> </span>for <span style="letter-spacing: .7pt;"> </span><span style="letter-spacing: -.05pt;">F</span>i<span style="letter-spacing: -.05pt;">n</span><span style="letter-spacing: .05pt;">a</span>nce Arjun <span style="letter-spacing: 2.1pt;"> </span>Ram <span style="letter-spacing: 1.05pt;"> </span>Megh<span style="letter-spacing: -.1pt;">w</span><span style="letter-spacing: .05pt;">a</span>l,<span style="letter-spacing: 1.9pt;"> </span>“Usage <span style="letter-spacing: -.05pt; mso-font-width: 109%;">o</span>f virtual<span style="letter-spacing: 1.15pt;"> </span><span style="letter-spacing: -.05pt;">c</span>urr<span style="letter-spacing: -.05pt;">e</span>ncies<span style="letter-spacing: -.55pt;"> </span>ano<span style="letter-spacing: -.05pt;">n</span>ymous/ps<span style="letter-spacing: -.05pt;">eu</span>donymous <span style="letter-spacing: .95pt;"> </span>s<span style="letter-spacing: -.05pt;">y</span>stems<span style="letter-spacing: .1pt;"> </span>c<span style="letter-spacing: -.05pt;">o</span>uld subject <span style="letter-spacing: 1.25pt;"> </span>the users
<span style="letter-spacing: 1.65pt;"> </span>to<span style="letter-spacing: 2.4pt;"> </span>unin<span style="letter-spacing: -.1pt;">t</span>entional <span style="letter-spacing: .8pt;"> </span>breaches<span style="letter-spacing: 1.6pt;"> </span>of an<span style="letter-spacing: -.05pt;">t</span>i-mon<span style="letter-spacing: -.05pt;">e</span>y<span style="letter-spacing: 1.55pt;"> </span><span style="letter-spacing: -.05pt;">l</span><span style="letter-spacing: .05pt;">a</span>un<span style="letter-spacing: -.05pt;">d</span>eri<span style="letter-spacing: -.05pt;">n</span>g <span style="letter-spacing: -.05pt;">a</span>nd <span style="letter-spacing: 2.15pt;"> </span>com<span style="letter-spacing: -.05pt;">b</span>a<span style="letter-spacing: -.05pt;">t</span>i<span style="letter-spacing: -.05pt;">n</span>g<span style="letter-spacing: 2.3pt;"> </span><span style="letter-spacing: -.05pt;">t</span>he <span style="letter-spacing: -.05pt; mso-font-width: 109%;">f</span>inan<span style="letter-spacing: -.05pt;">ci</span>ng<span style="letter-spacing: 2.3pt;"> </span>of
<span style="letter-spacing: .05pt;"> </span>terr<span style="letter-spacing: -.05pt;">o</span>rism
<span style="letter-spacing: .1pt;"> </span>laws.”Y<span style="letter-spacing: -.05pt;">o</span>u<span style="letter-spacing: 1.3pt;"> </span>rec<span style="letter-spacing: -.05pt;">e</span>ive <span style="letter-spacing: 2.1pt;"> </span><span style="letter-spacing: -.05pt;">B</span>itcoins
<span style="letter-spacing: 1.4pt;"> </span>on
<span style="letter-spacing: .9pt;"> </span>ad<span style="letter-spacing: -.05pt;">d</span>ress<span style="letter-spacing: -.05pt;">e</span>s,
which are<span style="letter-spacing: 2.25pt;">
</span>r<span style="letter-spacing: -.05pt;">a</span>ndomly<span style="letter-spacing: 1.6pt;"> </span>see<span style="letter-spacing: -.1pt;">m</span>ing<span style="letter-spacing: .55pt;"> </span>c<span style="letter-spacing: -.05pt;">h</span>ai<span style="letter-spacing: -.05pt;">n</span>s <span style="letter-spacing: 1.05pt;"> </span><span style="letter-spacing: -.05pt;">o</span>f<span style="letter-spacing: 1.3pt;"> </span>ar<span style="letter-spacing: -.05pt;">o</span>und<span style="letter-spacing: .5pt;"> </span><span style="letter-spacing: -.05pt;">3</span>0<span style="letter-spacing: .9pt;"> </span><span style="letter-spacing: -.05pt; mso-font-width: 110%;">c</span>ha<span style="letter-spacing: -.05pt;">r</span>ac<span style="letter-spacing: -.05pt;">t</span>ers.<span style="letter-spacing: .65pt;"> </span>It<span style="letter-spacing: 1.35pt;"> </span><span style="letter-spacing: -.05pt;">i</span>s<span style="letter-spacing: 1.4pt;"> </span><span style="letter-spacing: -.05pt;">a</span>lmost
impossi<span style="letter-spacing: -.1pt;">b</span>le<span style="letter-spacing: .85pt;"> </span><span style="letter-spacing: -.05pt;">t</span>o<span style="letter-spacing: 1.75pt;"> </span>c<span style="letter-spacing: -.05pt;">o</span>nnect
<span style="letter-spacing: 1.2pt;"> </span><span style="letter-spacing: -.05pt;">t</span>he
re<span style="letter-spacing: -.05pt;">a</span>l wo<span style="letter-spacing: -.05pt;">r</span>ld identity<span style="letter-spacing: -.25pt;"> </span>of<span style="letter-spacing: .4pt;"> </span>users <span style="letter-spacing: .15pt;"> </span>with
those<span style="letter-spacing: 2.3pt;"> </span><span style="letter-spacing: .05pt; mso-font-width: 112%;">a</span><span style="letter-spacing: -.05pt; mso-font-width: 112%;">d</span>dresses.<span style="letter-spacing: -.1pt;"> </span>You<span style="letter-spacing: .85pt;"> </span>may<span style="letter-spacing: 2.05pt;"> </span>be<span style="letter-spacing: .8pt;"> </span>de<span style="letter-spacing: .05pt;">a</span>ling<span style="letter-spacing: -.05pt;"> </span>with<span style="letter-spacing: 2.45pt;"> </span>terrorists<span style="letter-spacing: -.35pt;"> </span>or<span style="letter-spacing: 1.05pt;"> </span>Shah<span style="letter-spacing: 1.75pt;"> </span>Rukh<span style="letter-spacing: 2.35pt;"> </span>K<span style="letter-spacing: -.05pt;">h</span>an,<span style="letter-spacing: 2.1pt;"> </span>you<span style="letter-spacing: 1.95pt;"> </span>never
know!<o:p></o:p></span></div>
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<span style="font-family: "verdana" , sans-serif;"><br /></span></div>
<div class="MsoNormal" style="line-height: 107%; margin: 0cm 3.3pt 0.0001pt 5.55pt; text-align: left;">
<span style="font-family: "verdana" , sans-serif;">Bar<span style="letter-spacing: -.05pt;">r</span>ing <span style="letter-spacing: .8pt;"> </span><span style="letter-spacing: -.05pt;">t</span>he<span style="letter-spacing: -.05pt;">s</span>e <span style="letter-spacing: .3pt;"> </span>li<span style="letter-spacing: -.1pt;">m</span>i<span style="letter-spacing: -.05pt;">t</span>a<span style="letter-spacing: -.05pt;">t</span>ion<span style="letter-spacing: -.05pt;">s</span>,<span style="letter-spacing: .35pt;"> </span>what <span style="letter-spacing: .95pt;"> </span>works <span style="letter-spacing: .9pt;"> </span>best<span style="letter-spacing: 2.15pt;"> </span>for<span style="letter-spacing: 1.6pt;"> </span>bi<span style="letter-spacing: -.05pt;">t</span>co<span style="letter-spacing: -.05pt;">i</span>ns
<span style="letter-spacing: .9pt;"> </span>is<span style="letter-spacing: .9pt;"> </span>pure<span style="letter-spacing: 1.3pt;"> </span>e<span style="letter-spacing: -.05pt;">c</span>onomics.<span style="letter-spacing: -1.05pt;"> </span>The<span style="letter-spacing: 1.6pt;"> </span>model <span style="letter-spacing: 1.0pt;"> </span>is<span style="letter-spacing: 1.0pt;"> </span>d<span style="letter-spacing: -.05pt;">es</span>igned<span style="letter-spacing: .2pt;"> </span>in<span style="letter-spacing: 1.5pt;">
</span><span style="letter-spacing: -.05pt;">s</span>uch <span style="letter-spacing: .2pt;"> </span>a<span style="letter-spacing: 1.15pt;"> </span><span style="letter-spacing: -.1pt; mso-font-width: 115%;">w</span><span style="letter-spacing: .05pt; mso-font-width: 113%;">a</span>y <span style="letter-spacing: -.05pt;">t</span>hat
<span style="letter-spacing: .35pt;"> </span><span style="letter-spacing: -.05pt;">t</span>here <span style="letter-spacing: .65pt;"> </span>is<span style="letter-spacing: 1.0pt;"> </span>a<span style="letter-spacing: 1.15pt;"> </span>CAP<span style="letter-spacing: 1.9pt;"> </span>of<span style="letter-spacing: .95pt;"> </span>21<span style="letter-spacing: -.1pt;">m</span>n<span style="letter-spacing: 2.4pt;"> </span><span style="letter-spacing: -.05pt;">b</span>i<span style="letter-spacing: -.05pt;">t</span>coins <span style="letter-spacing: -.05pt;">t</span>hat
<span style="letter-spacing: .35pt;"> </span>can<span style="letter-spacing: 1.95pt;"> </span><span style="letter-spacing: -.05pt;">b</span>e<span style="letter-spacing: 1.4pt;"> </span>genera<span style="letter-spacing: -.05pt;">t</span>ed<span style="letter-spacing: .45pt;"> </span><span style="letter-spacing: -.05pt;">b</span>y<span style="letter-spacing: 1.6pt;"> </span>ye<span style="letter-spacing: -.05pt;">a</span>r<span style="letter-spacing: 2.5pt;"> </span>2<span style="letter-spacing: -.05pt;">1</span>40<span style="letter-spacing: .5pt;"> </span>and
<span style="letter-spacing: .5pt;"> </span>cu<span style="letter-spacing: -.05pt;">r</span>ren<span style="letter-spacing: -.05pt;">t</span>ly<span style="letter-spacing: .45pt;"> </span>appro<span style="letter-spacing: -.05pt;">x</span>.<span style="letter-spacing: .35pt;"> </span>1<span style="letter-spacing: -.05pt;">6</span>.5<span style="letter-spacing: .55pt;"> </span>mn<span style="letter-spacing: 2.35pt;"> </span><span style="letter-spacing: -.05pt; mso-font-width: 110%;">b</span>i<span style="letter-spacing: -.05pt; mso-font-width: 117%;">t</span>coins are<span style="letter-spacing: 1.4pt;"> </span>in<span style="letter-spacing: .95pt;"> </span><span style="letter-spacing: -.05pt; mso-font-width: 109%;">c</span>irculation. When<span style="letter-spacing: 2.4pt;"> </span>supply<span style="letter-spacing: -.4pt;"> </span>is<span style="letter-spacing: .45pt;">
</span>limit<span style="letter-spacing: -.05pt;">e</span>d,<span style="letter-spacing: -.25pt;"> </span>and<span style="letter-spacing: 2.45pt;"> </span>de<span style="letter-spacing: -.1pt;">m</span><span style="letter-spacing: .05pt;">a</span><span style="letter-spacing: -.05pt;">n</span>d<span style="letter-spacing: 1.2pt;"> </span>incr<span style="letter-spacing: -.05pt;">e</span><span style="letter-spacing: .05pt;">a</span><span style="letter-spacing: -.05pt;">s</span>es,<span style="letter-spacing: -1.25pt;"> </span>we<span style="letter-spacing: 1.4pt;"> </span>all<span style="letter-spacing: .8pt;"> </span>know
what
<span style="letter-spacing: .4pt;"> </span>happe<span style="letter-spacing: -.05pt;">n</span>s<span style="letter-spacing: -.25pt;"> </span>to<span style="letter-spacing: .95pt;"> </span>the<span style="letter-spacing: 1.6pt;"> </span>pri<span style="letter-spacing: -.05pt;">c</span>e.<o:p></o:p></span></div>
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<span style="font-family: "verdana" , sans-serif;">In<span style="letter-spacing: 1.95pt;"> </span>a<span style="letter-spacing: 1.7pt;"> </span>mere
<span style="letter-spacing: .95pt;"> </span><span style="letter-spacing: .05pt;">1</span>8<span style="letter-spacing: 1pt;"> </span>d<span style="letter-spacing: .05pt;">a</span>ys <span style="letter-spacing: 1.2pt;"> </span>after <span style="letter-spacing: .6pt;"> </span>the <span style="letter-spacing: .2pt;"> </span>demonet<span style="letter-spacing: .05pt;">i</span>zation<span style="letter-spacing: 1.2pt;"> </span>speech
<span style="letter-spacing: 1.3pt;"> </span>of<span style="letter-spacing: 1.5pt;"> </span>P<span style="letter-spacing: -.05pt;">r</span>ime
<span style="letter-spacing: 1.15pt;"> </span><span style="letter-spacing: -.05pt; mso-font-width: 112%;">M</span>inister<span style="letter-spacing: .1pt;"> </span>Narend<span style="letter-spacing: -.05pt;">r</span>a<span style="letter-spacing: 2.2pt;"> </span>Mo<span style="letter-spacing: -.05pt;">d</span>i, <span style="letter-spacing: .8pt;"> </span>the <span style="letter-spacing: .15pt;"> </span>price <span style="letter-spacing: .6pt;"> </span>of<span style="letter-spacing: 1.5pt;"> </span><span style="letter-spacing: -.1pt;">b</span>itcoins <span style="letter-spacing: 1.4pt;"> </span>on Ze<span style="letter-spacing: -.05pt;">b</span>p<span style="letter-spacing: .05pt;">a</span>y,<span style="letter-spacing: .5pt;"> </span>ha<span style="letter-spacing: -.1pt;">v</span><span style="letter-spacing: -.05pt;">i</span>ng1<span style="letter-spacing: .55pt;"> </span>mi<span style="letter-spacing: -.05pt;">l</span>lion
<span style="letter-spacing: .85pt;"> </span><span style="letter-spacing: -.05pt;">u</span>sers, <span style="letter-spacing: -.05pt;">h</span><span style="letter-spacing: .05pt;">a</span>d su<span style="letter-spacing: -.05pt;">r</span>ged<span style="letter-spacing: .35pt;"> </span>from
<span style="letter-spacing: .15pt;"> </span><span style="letter-spacing: -.05pt;">$</span><span style="letter-spacing: .05pt;">7</span><span style="letter-spacing: -.05pt;">5</span>0<span style="letter-spacing: .55pt;"> </span><span style="letter-spacing: -.05pt;">t</span>o<span style="letter-spacing: 1.4pt;"> </span>$1<span style="letter-spacing: -.05pt;">,</span>0<span style="letter-spacing: -.05pt;">2</span>0.<span style="letter-spacing: .5pt;"> </span></span><br />
<span style="font-family: "verdana" , sans-serif;">If<span style="letter-spacing: .45pt;"> </span>adop<span style="letter-spacing: -.05pt;">t</span>ion<span style="letter-spacing: .3pt;"> </span><span style="letter-spacing: -.05pt;">b</span>y<span style="letter-spacing: 1.55pt;"> </span>few<span style="letter-spacing: 2.0pt;"> </span><span style="letter-spacing: -.05pt;">b</span>i<span style="letter-spacing: -.05pt;">l</span>lion
<span style="letter-spacing: .35pt;"> </span>India<span style="letter-spacing: -.05pt;">n</span>s<span style="letter-spacing: .35pt;"> </span>can<span style="letter-spacing: 1.9pt;"> </span>l<span style="letter-spacing: -.05pt;">ea</span>d <span style="letter-spacing: .2pt;"> </span><span style="letter-spacing: -.05pt;">t</span>o<span style="letter-spacing: 1.4pt;"> </span>a 33%<span style="letter-spacing: 0.8pt;"> </span>increm<span style="letter-spacing: -0.05pt;">e</span>n<span style="letter-spacing: -0.05pt;">t</span>,<span style="letter-spacing: 0.85pt;"> </span>ima<span style="letter-spacing: -0.05pt;">g</span>ine<span style="letter-spacing: 0.95pt;"> </span><span style="letter-spacing: -0.05pt;">t</span>he<span style="letter-spacing: 2.45pt;"> </span>level<span style="letter-spacing: 2.4pt;"> </span>it<span style="letter-spacing: 1.45pt;"> </span><span style="letter-spacing: -0.1pt;">w</span>ould<span style="letter-spacing: 0.55pt;"> </span>r<span style="letter-spacing: -0.05pt;">e</span>ach <span style="letter-spacing: 0.65pt;"> </span><span style="letter-spacing: -0.1pt;">w</span>hen<span style="letter-spacing: 0.75pt;"> </span>1<span style="letter-spacing: -0.1pt;">.</span>3<span style="letter-spacing: 0.85pt;"> </span>bi<span style="letter-spacing: -0.05pt;">l</span>li<span style="letter-spacing: -0.05pt;">o</span>n <span style="letter-spacing: 0.65pt;"> </span>Indians<span style="letter-spacing: 0.45pt;"> </span>get<span style="letter-spacing: 2.2pt;"> </span>on<span style="letter-spacing: 2.15pt;"> </span>i<span style="letter-spacing: -0.05pt;">t</span>!!<span style="letter-spacing: 1.05pt;"> </span>Now <span style="letter-spacing: 0.95pt;"> </span>ima<span style="letter-spacing: -0.05pt;">g</span>ine<span style="letter-spacing: 0.6pt;"> </span><span style="letter-spacing: -0.05pt;">i</span>f<span style="letter-spacing: 1.05pt;"> </span><span style="letter-spacing: -0.05pt;">t</span>he<span style="letter-spacing: 2.45pt;"> </span>en<span style="letter-spacing: -0.05pt;">t</span>ire world<span style="letter-spacing: -0.4pt;"> </span>gets<span style="letter-spacing: 1.75pt;"> </span>on<span style="letter-spacing: 1.25pt;"> </span>it.</span></div>
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<span style="font-family: "verdana" , sans-serif;">In<span style="letter-spacing: 1.45pt;"> </span>year <span style="letter-spacing: .15pt;"> </span>2013,<span style="letter-spacing: .55pt;"> </span>no<span style="letter-spacing: 1.9pt;"> </span>one<span style="letter-spacing: 2.2pt;"> </span>thought<span style="letter-spacing: .2pt;"> </span>Sachin Tendulkar’s<span style="letter-spacing: .35pt;"> </span>rec<span style="letter-spacing: -.05pt;">o</span>rds<span style="letter-spacing: .85pt;"> </span>could <span style="letter-spacing: .8pt;"> </span>be<span style="letter-spacing: 1.4pt;"> </span>repli<span style="letter-spacing: -.05pt;">c</span>a<span style="letter-spacing: -.05pt;">t</span>ed.<span style="letter-spacing: .5pt;"> </span>F<span style="letter-spacing: -.05pt;">o</span>ur
<span style="letter-spacing: .25pt;"> </span>ye<span style="letter-spacing: -.05pt;">a</span>rs <span style="letter-spacing: .5pt;"> </span><span style="letter-spacing: -.05pt;">l</span><span style="letter-spacing: .05pt;">a</span><span style="letter-spacing: -.05pt;">t</span>e<span style="letter-spacing: -.05pt;">r</span>, wi<span style="letter-spacing: -.05pt;">t</span>h
<span style="letter-spacing: .55pt;"> </span>Vi<span style="letter-spacing: -.05pt;">r</span>at<span style="letter-spacing: 2.25pt;"> </span>Kohli in<span style="letter-spacing: 1.8pt;"> </span>ram<span style="letter-spacing: -.1pt;">p</span>agi<span style="letter-spacing: -.05pt;">n</span>g<span style="letter-spacing: .85pt;"> </span>form,
<span style="letter-spacing: .35pt;"> </span><span style="letter-spacing: -.05pt;">t</span>hat <span style="letter-spacing: -.1pt; mso-font-width: 110%;">p</span>ossi<span style="letter-spacing: -.1pt;">b</span>i<span style="letter-spacing: -.05pt;">l</span>i<span style="letter-spacing: -.05pt;">t</span>y<span style="letter-spacing: .8pt;"> </span>is<span style="letter-spacing: 1.35pt;"> </span><span style="letter-spacing: -.05pt;">n</span>ot
<span style="letter-spacing: .05pt;"> </span>far<span style="letter-spacing: 2pt;"> </span>behi<span style="letter-spacing: -.1pt;">n</span><span style="letter-spacing: -.05pt;">d</span>.<span style="letter-spacing: .8pt;"> </span>The<span style="letter-spacing: 1.95pt;">
</span>old <span style="letter-spacing: .05pt;"> </span><span style="letter-spacing: -.05pt; mso-font-width: 116%;">g</span>uard<span style="letter-spacing: .7pt;"> </span>has <span style="letter-spacing: .1pt;"> </span>to<span style="letter-spacing: 1.8pt;"> </span>make <span style="letter-spacing: .95pt;"> </span>way <span style="letter-spacing: .45pt;"> </span>for<span style="letter-spacing: 1.9pt;"> </span><span style="letter-spacing: -.1pt;">t</span>he
new gen<span style="letter-spacing: -.05pt;">e</span>ration.
Bitcoin <span style="letter-spacing: 1.05pt;"> </span>is <span style="letter-spacing: .05pt;"> </span><span style="letter-spacing: -.05pt;">r</span>i<span style="letter-spacing: -.05pt;">s</span>ky <span style="letter-spacing: 1.75pt;"> </span>but <span style="letter-spacing: 1.65pt;"> </span>time <span style="letter-spacing: 1.55pt;"> </span>chang<span style="letter-spacing: -.05pt;">e</span>s<span style="letter-spacing: 1.75pt;"> </span>eve<span style="letter-spacing: -.05pt;">r</span>ything<span style="letter-spacing: 2.3pt;">
</span>and <span style="letter-spacing: 2.05pt;"> </span><span style="letter-spacing: -.1pt;">t</span>his
cha<span style="letter-spacing: -.05pt;">n</span>ge
brings <span style="letter-spacing: .05pt;"> </span>lot <span style="letter-spacing: .6pt;"> </span>of oppor<span style="letter-spacing: -.05pt;">t</span>uni<span style="letter-spacing: -.05pt;">t</span>ies<span style="letter-spacing: 2.05pt;"> </span><span style="letter-spacing: -.05pt;">t</span>o
<span style="letter-spacing: .5pt;"> </span>capi<span style="letter-spacing: -.05pt;">t</span><span style="letter-spacing: .05pt;">a</span>l<span style="letter-spacing: -.05pt;">i</span>z<span style="letter-spacing: -.05pt;">e</span>.<span style="letter-spacing: 1.05pt;"> </span>Can
bi<span style="letter-spacing: -.05pt;">t</span>coins <span style="letter-spacing: .3pt;"> </span>s<span style="letter-spacing: -.05pt;">t</span>i<span style="letter-spacing: -.05pt;">l</span>l<span style="letter-spacing: 1.25pt;"> </span><span style="letter-spacing: -.1pt;">b</span>e<span style="letter-spacing: .85pt;"> </span>igno<span style="letter-spacing: -.05pt;">r</span>ed?</span><br />
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<br />
<div style="text-align: left;">
<i style="text-align: justify;"> -CA<span style="letter-spacing: 1.15pt;"> </span>A<span style="letter-spacing: -.05pt;">k</span>sh<span style="letter-spacing: -.05pt;">a</span>y<span style="letter-spacing: 1.05pt;"> </span>Sirsalewala<span style="letter-spacing: .1pt;"> </span>&<span style="letter-spacing: .05pt;"> </span><span style="letter-spacing: -.1pt;">C</span>A<span style="letter-spacing: 1.1pt;"> </span>Ami<span style="letter-spacing: -.05pt;">s</span>h<span style="letter-spacing: 1.55pt;"> </span>Ma<span style="letter-spacing: -.05pt;">k</span><span style="letter-spacing: -.05pt; mso-font-width: 108%;">w</span>ana</i></div>
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<o:p></o:p></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-1406529399629589062017-04-13T17:11:00.001+05:302017-04-13T17:37:02.607+05:30Bad Loans is Good Business<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="background: white;"><span style="font-family: "arial" , "helvetica" , sans-serif;">Bad loans business is getting better as the
banking regulator RBI tightens norms for dealing in stressed assets market.<o:p></o:p></span></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;"><span style="background: white;">The asset reconstruction companies (ARCs) now
need enhanced net owned funds of Rs 100 crore as compared to just Rs 2 crore
earlier. As a result, larger ARCs backed by strong promoter groups would be on
a firm footing<span class="apple-converted-space"> </span>to attract capital
from external sources as 100 per cent foreign direct investment is permitted in
the sector, Crisil says in its report.</span> M<span style="background: white;">any
of the smaller ARCs may be on way to consolidate through merger with top five
players that account for 90% of total assets under management of 23 ARCs.</span></span><o:p></o:p></div>
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<span style="font-family: "arial" , sans-serif; font-size: 9pt;"><span style="background: white;"><br /></span></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">The recent tightening of ARCs' capital requirements will
lead to consolidation in the industry and that bigger players stand to benefit
from the move, says a report. <o:p></o:p></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">The Reserve Bank last week increased the net-owned funds for
asset reconstruction companies (ARCs) to Rs 100 crore from a meagre Rs 2 crore.
Last April it had increased the upfront payment requirement to 15 per cent of
the asset value from 5 per cent. <o:p></o:p></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Crisil believes these are among a series of steps taken by
RBI to strengthen the ARC ecosystem that will attract players with deep
pockets, enhance transparency in asset sales, improve recoveries and open up
scope for consolidation. <o:p></o:p></span><br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"><br /></span>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Given the thicket of rule changes, larger ARCs will be on a
firmer footing, especially those backed by strong promoter groups with the
ability and intent to infuse capital, and relatively better capability to
attract capital from external sources as 100 per cent foreign direct investment
is permitted in the sector, says the report. <o:p></o:p></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">The ability and intent of promoters and investors in smaller
ARCs to infuse capital will be a monitorable and would potentially be a
catalyst of consolidation. <o:p></o:p></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">According to Crisil, of the 23 ARCs, six are comfortable in
terms of the revised net-owned funds requirement and other stringent norms. But
those struggling to infuse capital or raise external funds and lacking in
specialist manpower will get marginalised further. <o:p></o:p></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">"The top five players (Edelweis, JM Financial, Arcil,
Kotak etc) account for around 90 per cent of total assets under management.
With tighter regulations, we believe their market share will consolidate
further and smaller ones may merge with larger rivals, or they could become takeover
targets for large private equity investors and stressed asset funds wishing to
enter the business," the report said. <o:p></o:p></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">It can be noted that from April 1, 2017, the RBI has
increased the provisioning requirement for banks investing over 50 per cent of
the value of stressed assets (the limit subsequently to be reduced to 10 per
cent from April 2018) sold by them in the security receipts issued in lieu. <o:p></o:p></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">The RBI intends to ensure that any NPA sale is a true sale
conducted through a transparent process where the ARC ends up with significant
skin in the game so as to maximise recoveries. <o:p></o:p></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">The strengthened framework will affect the volume of asset
sales as banks are reluctant to take adequate haircuts, says the report, adding
however, it will lead to more cash- based sale which would need higher capital.
<o:p></o:p></span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Asset sales spiked in March quarter of fiscal 2017 before
the new provisioning norm kicked in. According to its estimates, Rs 21,000
crore of NPAs were sold in the March quarter taking the total outstanding
assets under management with ARCs to Rs 75,000 crore. </span><o:p></o:p></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-27990100639592731632017-04-03T15:55:00.001+05:302017-04-04T10:38:19.418+05:30Infrastructure Investment Fund (InvIT)<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="font-family: "verdana" , sans-serif; font-size: 9pt;">InvITs are mutual fund like institutions that can play a crucial role in meeting India’s huge</span><span style="font-family: "verdana" , sans-serif; font-size: 9pt;"> infrastructure requirements, estimated to be Rs 4.3 lakh crore (Rs 4.3 trillion) over the next five years. The InvIT offers an opportunity to promoters of projects to sell their stake in completed projects to the trust, which in turn can raise long-term and tax-free funds from unit holders. Infrastructures developers like IRB, GMR, IL&FS and Reliance Infrastructure are keen to launch InvIT to raise funds, a move which can potentially pump in liquidity in the otherwise cash-strapped infrastructure sector.</span></div>
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<span style="font-family: "verdana" , sans-serif; font-size: 9pt;">Infrastructure is an asset class in India that is garnering attention among investors worldwide and could be the perfect asset for pension plans seeking to match long-term liabilities, diversify portfolio holdings, lower the risk of capital loss and, in some cases, hedge inflation as well.<o:p></o:p></span></div>
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<span style="font-family: "verdana" , sans-serif; font-size: 9pt;">Hence, large foreign pension plans, foreign endowment funds and many domestic yield focused funds are the targeted investors for InvITs.<b><o:p></o:p></b></span><br />
<span style="font-family: "verdana" , sans-serif; font-size: 9pt;"><span style="color: black; text-align: left;">InvITs will provide a suitable structure for financing/refinancing of infrastructure projects in the country.</span></span><br />
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Several existing infrastructure projects in India are
delayed due to</span><o:p></o:p></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Increasing debt finance costs</span><o:p></o:p></div>
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Locked up equity of private investors in projects</span><o:p></o:p></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">Lack of international finance </span><o:p></o:p></div>
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<span style="font-family: "bodoni mt black" , serif; font-size: 14.0pt; line-height: 107%;">·</span> <span style="font-family: "arial" , "helvetica" , sans-serif;">Project implementation delays caused
by global economic slowdown, cost overruns, inability of concessionaire to meet
funding requirements on time, etc.<o:p></o:p></span></div>
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<b><span style="font-family: "arial" , "helvetica" , sans-serif;">InvITs, as an investment vehicle, may aid:</span><o:p></o:p></b></div>
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<!--[if !supportLists]--><span style="font-family: "bodoni mt black" , serif; font-size: 14.0pt; line-height: 107%;">·<span style="font-family: "times new roman"; font-size: 7pt; font-stretch: normal; line-height: normal;"> </span></span><span style="font-family: "arial" , "helvetica" , sans-serif;">Providing wider and long-term re-finance for
existing infrastructure projects.</span><o:p></o:p></div>
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<!--[if !supportLists]--><span style="font-family: "bodoni mt black" , serif; font-size: 14.0pt; line-height: 107%;">·<span style="font-family: "times new roman"; font-size: 7pt; font-stretch: normal; line-height: normal;"> </span></span><span style="font-family: "arial" , "helvetica" , sans-serif;">Freeing up of current developer’s capital for
reinvestment into new infrastructure projects.</span><o:p></o:p></div>
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<!--[if !supportLists]--><span style="font-family: "bodoni mt black" , serif; font-size: 14.0pt; line-height: 107%;">·<span style="font-family: "times new roman"; font-size: 7pt; font-stretch: normal; line-height: normal;"> </span></span><span style="font-family: "arial" , "helvetica" , sans-serif;">Refinancing/takeout of existing high cost debt
with long-term low-cost capital and help banks free up their funds for new
funding requirements.</span><o:p></o:p></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-45376187609945726522017-03-21T10:12:00.000+05:302017-03-21T10:12:58.282+05:30Consumer credit demand rebounds after note ban<div dir="ltr" style="text-align: left;" trbidi="on">
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg8As4yidXhZwKJJ-xy2oO0Mnt247ZhZXJI2Q8mEP45Yt1DMN8W3TOePTGLcjfnnhChyPc-lBhm7QndF6XWLD-TuQX4D0or8vQItrRhYCGiQxvxFkgxxabLx072bG681_Ufu7LpTTcd6xTS/s1600/1490036491-8054.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="476" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg8As4yidXhZwKJJ-xy2oO0Mnt247ZhZXJI2Q8mEP45Yt1DMN8W3TOePTGLcjfnnhChyPc-lBhm7QndF6XWLD-TuQX4D0or8vQItrRhYCGiQxvxFkgxxabLx072bG681_Ufu7LpTTcd6xTS/s640/1490036491-8054.jpg" width="640" /></a><span style="font-family: "arial" , sans-serif; font-size: 12.0pt; line-height: 107%;">The demand for consumer loans in India seems to be
returning as the adverse effect of demonetisation on the confidence of
households wanes.<o:p></o:p></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 12.0pt; line-height: 107%;">Demand growth was flat in November 2016 over the same month
a year before but moved up 15 per cent in January, according to TransUnion
CIBIL, a leading credit information agency. The financial system had seen
unprecedented consumer credit growth over the earlier four years, including
loans for vehicles and homes, cards and other credit products. The announcement
on demonetisation created short-term disruption in this, says the agency.<o:p></o:p></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 12.0pt; line-height: 107%;">However, new data indicate a strong rebound in demand for
loans from individuals. A promising indicator for the stability and growth
prospects of the credit sector and the economy overall, said Amrita Mitra,
vice-president at TransUnion CIBIL.<o:p></o:p></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 12.0pt; line-height: 107%;">Public sector bank (PSB) executives said loan performance
had remained stable after demonetisation but that it would take five to six
months for credit demand to become normal.</span></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh_HM9Yy-6j5oPfRyCq5J1CClwaaTObIJ5RKvryf2v6a0H8Hbso1kNoFj1OA75XT8U8OOxZDTqjZG3-J2FKOt-K5Eyd7RBoTZ8mRMxGQFHKidzA5TDFDqMH5_H7VKpefdvY_iNNpwyCIpLa/s1600/1490036612-2319.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="400" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh_HM9Yy-6j5oPfRyCq5J1CClwaaTObIJ5RKvryf2v6a0H8Hbso1kNoFj1OA75XT8U8OOxZDTqjZG3-J2FKOt-K5Eyd7RBoTZ8mRMxGQFHKidzA5TDFDqMH5_H7VKpefdvY_iNNpwyCIpLa/s400/1490036612-2319.jpg" style="cursor: move;" width="207" /></a><span style="font-family: "arial" , sans-serif; font-size: 12.0pt; line-height: 107%;">While loan demand shows signs of an uptrend, the pace of
credit disbursal remains a concern. Aggregate credit granted fell 12 per cent
in November 2016 from a year before; December loan originations were similarly
down 13 per cent. PSBs showed the largest decrease in originations among major
lender types, down by a little over 50 per cent in December 2016, compared to
December 2015.<o:p></o:p></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 12.0pt; line-height: 107%;">A notable exception to the origination drop was in credit
cards, where there was a 10 per cent year-on-year increase in November. The
drive on digital payments, one of the objectives of demonetisation, has shown
initial positive results. Mitra said the drop in originations was not a
consumer demand issue but one of lender supply. The pace of credit expansion
had slowed even before the demonetisation decision in early November. Banks
turned cautious after the high pace of growth in 2015-16, to contain defaults.
According to the Reserve Bank of India data, retail (to individuals) credit by
banks grew 12.9 per cent in the 12 months till January 2017, down from 18.1 per
cent in the preceding 12 months till January 2016. The loan book was Rs
15,23,600 crore.<o:p></o:p></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 12.0pt; line-height: 107%;">In the light of generally stable consumer credit
performance after demonetisation, this lender retrenchment might be
unwarranted. Analysis of the delinquency trends (90 days or more past dues) in
December 2016, compared to December 2015, shows relatively stable performance
overall, with improvements in automobile loans and credit card delinquency
rates offsetting some deterioration in two-wheeler and housing loans. “There
are early signs of relatively stable delinquencies. Lenders might have
curtailed origination activity in anticipation of a significant increase here
but to date, we have not experienced that deterioration. The key challenge for
lenders is how to prudently capitalise on this opportunity to meet higher
consumer credit demand,” Mitra added.<o:p></o:p></span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-45173667144917400332017-03-16T11:37:00.002+05:302017-03-16T11:37:57.354+05:30With note ban, the traditional wholesale channel collapsed: Metro’s Mediratta<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="background-color: white; font-family: "Roboto Slab", serif;"><b><span style="font-size: large;">Traditional food and grocery retail accounts for 97-98% of consumer packaged goods sector’s overall sales, says Arvind Mediratta, CEO of Metro Cash and Carry India</span></b></span></h3>
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<span style="font-family: Arial, Helvetica, sans-serif;">After the government invalidated Rs500 and Rs1,000 currency notes, the traditional wholesale channel collapsed. It has also opened new opportunities for wholesalers in the organized sector.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">“We are the preferred partner for most of the companies right now for new product launches,” says Arvind Mediratta, managing director and chief executive officer of Metro Cash and Carry India Pvt. Ltd, the local arm of the German retailer, in an interview. Edited excerpts:</span></div>
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh9tw7Bns_gtTipIc6GgHQoI22OptlmTWsEL4368O4lgQtDM5-dopS7P-oSAMmwdFI_IUDqyDmvDUaUKatvCPMb-6gJQN2MviluP9TL50gKp7gPDx6DD3xuUfIHzTTLzBXiBMzzVh0syHLS/s1600/str-kIxF--621x414%2540LiveMint.jpg" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="426" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh9tw7Bns_gtTipIc6GgHQoI22OptlmTWsEL4368O4lgQtDM5-dopS7P-oSAMmwdFI_IUDqyDmvDUaUKatvCPMb-6gJQN2MviluP9TL50gKp7gPDx6DD3xuUfIHzTTLzBXiBMzzVh0syHLS/s640/str-kIxF--621x414%2540LiveMint.jpg" width="640" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><b>Arvind Mediratta</b>MD and CEO of Metro Cash and Carry India. </td></tr>
</tbody></table>
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<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;"><br />What was the impact of demonetisation for you?</span></b></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">In the past, companies have relied on their distributors, sub-distributors and traditional wholesalers to service small stores. With demonetisation, the traditional wholesale channel collapsed. Manufacturers are now looking at us as their route to market for a lot of their product categories. They are planning exclusive products (stock keeping unit) for us as we have a wide reach and ability to sell a wider basket. This dialogue with companies has now gained momentum following demonetisation. We are the preferred partner for most of the companies right now for new product launches.</span></div>
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<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">But didn’t your business also suffer as the retailer faced a cash crunch?</span></b></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">We ask our customers to pay in advance and then deliver. We don’t extend credit to our traders. Customers can buy as much and as often as they want. In the traditional system, they used to stock up for three days, a week or a fortnight, and this is not required when they buy from us. However, earlier we used to have a minimum requirement of Rs1,000 bill. Now, post-demonetisation, we have taken off this restriction, and people come to us more regularly. Small bills of Rs1,000 and below is 10% of business. One of our stores in Delhi got ransacked because people thought salt prices would go up to Rs200 per kg and we saw people ransacking sugar, salt. We had to call the police. There were rumours prices would go up. But, in fact, they crashed as farmers didn’t know how to sell.</span></div>
<div class="question" style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">So, what was the kind of growth did you see during the December quarter and is this continuing in January? </span></b></div>
<div style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<span style="font-family: Arial, Helvetica, sans-serif;">We saw double-digit like-to-like growth in the December quarter, it was very good for us. This is continuing in January. There have been some fundamental shifts, which is short-term. For instance, people are buying more essentials and basics. The frequency of visits have increased. People have cut back on their spends on electronics, apparel and household items. </span></div>
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<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">By when do you see sales getting back to normal? </span></b></div>
<div style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<span style="font-family: Arial, Helvetica, sans-serif;">For non-food, it will take another quarter to come back to normal. For food and FMCG (fast-moving consumer goods), the impact lasted only for a week, and sales are back at normal now. </span></div>
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<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">What is the scope for cash and carry or modern wholesale in big cities where traditional wholesale channels are well established?</span></b></div>
<div style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<span style="font-family: Arial, Helvetica, sans-serif;">Cash and carry is nothing but modern wholesale. There are close to 10 million kirana stores in the country. Even the best of FMCG companies don’t directly reach more than 10-15% of this. So, they rely on the traditional wholesale channels to reach the other outlets. Contrary to what people say and even what’s written in the media, I personally believe that the mom-and- pop kirana stores are here to stay, at least for the next 25-30 years. The traditional food and grocery retail accounts for 97-98% of the FMCG sector’s overall sales. This includes FMCG, food, groceries, commodities and fresh—dairy, poultry, meat and seafood. In the non-food component or general merchandise, which is apparel, shoes, electronics, there, the modern trade share varies from 7-8%, but for food and groceries, modern trade is just 2-3%. </span></div>
<div class="question" style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">However for some large FMCG companies modern trade now accounts for 15-20% of their overall revenues. </span></b></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">It could be. But a large part of the consumer spends in food and groceries is on fresh, which is fruits and vegetables, dairy, meat, chicken and seafood. That is ballpark 30% of the total spend in an average Indian household.</span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Then, another 30-35% is spent on staples like <i style="outline: 0px;">atta</i> (flour), <i style="outline: 0px;">chawal</i> (rice), pulses, spices, dry fruits, sugar, salt. Another 30-35% is FMCG. So, even 15% for FMCG doesn’t necessarily mean 15% of modern trade for food and groceries. For instance, as much as 99% of commodities is bought from traditional stores and even when it comes to buying fresh, people still prefer to buy from the traditional markets. </span></div>
<div class="question" style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">How much do kirana stores account for your overall revenue?</span></b></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">Traders account for 40% of the overall business, followed by hotels, restaurants and caterers at 20%, and the rest, which is offices and institutions; these could be corporate offices or even the army, self-employed professionals, which is 40%. </span></div>
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<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">So, are you saying that the traditional wholesaler could become redundant? </span></b></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">There is a big opportunity for us to coexist with traditional distributors as they cater to only the larger stores. We are catering to the smaller stores which are anyways largely ignored by the traditional system. </span></div>
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<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">How much of the wholesale business do you see shifting to organized from unorganized? </span></b></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">It is difficult to predict; but with GST (goods and services tax) also coming in, we see it becoming a level playing field and becoming more favourable for modern cash and carry trade, which is abiding by all the laws. </span></div>
<div class="question" style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">How will you compete with local distributors and wholesalers who know the local market better? </span></b></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">In India, what works in the north will not work in the south, and there are also a lot of local and regional brands. We are focusing on these local and regional brands, especially in food and groceries, because people want a particular brand of spice or oil. So, for instance, when we opened a store in Gujarat, we found people were using cottonseed oil, which is not common in other parts of the country. Likewise, there are brands in the south which are specific to that region. Likewise in apparel, in Punjab, we need to stock a lot more of large sizes, whereas in Bengaluru, the large sizes don’t sell. In Amritsar, we used to stock small <i style="outline: 0px;">thalis </i>(plates) and small bowls, but we noticed nobody was buying those. So, these are things we have to localize according to the market. </span></div>
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<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">What prompted you to change your business model to equip the sales force with tablets in India? </span></b></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">We piloted this about six months back in Jaipur and now have this facility in six-seven stores, and are rolling it out gradually. The concept here is very simple. It is the e-commerce version of cash and carry. If people cannot come to the store, you virtually carry the store to them on the tablet with a person. A lot of kirana storeowners will not shift online. They are used to having someone visit them for placing an order; to change the behaviour, we have to have e-commerce with a human interface. We need to understand these traditional shopkeepers, we can’t expect them to suddenly change their way of doing business. </span></div>
<div class="question" style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">What are your plans for India? </span></b></div>
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<span style="font-family: Arial, Helvetica, sans-serif;">India is a priority market. We have 23 stores and have said earlier that by 2020 we will have 50 stores. Last year, we have stepped up on our expansion, opening five stores in one year. We want to become the dominant firm in markets we are present in and also enter into more states. </span></div>
<div class="question" style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">What is the penetration of organized cash and carry in markets where you are present? </span></b></div>
<div style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<span style="font-family: Arial, Helvetica, sans-serif;">We feel we have plenty of headroom for growth even in markets like Bengaluru, where we have six stores. While I can’t disclose our market share numbers, all I can say is we have a significant share of the $2-billion organized wholesale cash and carry market. In Bengaluru, we have 450,000 business customers across all three segments, of which traders would be 1.2-1.5 lakh. </span></div>
<div class="question" style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<b style="outline: 0px;"><span style="font-family: Arial, Helvetica, sans-serif;">You have recently strengthened your top management and made operational changes. Why is that?</span></b></div>
<div style="background-color: white; margin-bottom: 15px; outline: 0px; padding: 0px;">
<span style="font-family: Arial, Helvetica, sans-serif;">We are getting ready for rapid expansion and profitable growth. It took us quite some time to understand the Indian retail market. We now believe we understand it very well. Hence, we armed our sales force with tablets and are making other operational changes. Also we now believe the environment is coming together with demonetisation and GST, and that augurs very well for a modern cash and carry firm. Suddenly the stars seem to be aligned.</span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-76222653164286687982017-03-07T17:22:00.000+05:302017-03-07T17:39:33.147+05:30<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="font-family: "verdana" , sans-serif;"><span style="font-size: x-large;">The Science of</span><span style="color: #666666; font-size: x-large;"> </span></span></h2>
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<span style="color: #0b5394; font-family: "verdana" , sans-serif; font-size: x-large;">Superfoods</span></h2>
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<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: large;">Kale and chia, goji berries and blueberries, salmon and spinach. JAMIE MILLAR investigates the science behind whether superfoods are the magic bullet that can cure all our ills, and which ones deserve their ‘super’ prefix</span></h3>
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<span style="color: #0b5394; font-family: "arial" , "helvetica" , sans-serif;">Tricky to study</span></h4>
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<span style="font-family: "arial" , "helvetica" , sans-serif;"> The proof of the superfood pudding is in the eating – by humans, not mice or rats. But unfortunately, most scientific research is not conducted this way. “Nutrition studies often don’t apply to real life on a 1:1 basis,” “If you want to test, say, the effect of grape juice on cognition, you’d give it enough time, plus you’d check to make sure they actually drink it. In real life, that almost never happens.” Lifestyle factors are difficult if not impossible to separate. And there are other problems, pilot studies and animal trials will often use larger dosages, while ‘acute’ studies will look at just the food without any other things consumed. Meanwhile, eating different foods together, which is what most of us do, can dramatically alter their effects for better or worse: “Co-consumption makes things more complicated.” </span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;"> Another issue affecting superfood research is that it is often paid for by interested parties. “We’re funded by food and supplement companies in many of the studies we conduct,” admits Professor David Nieman,Director of the Human Performance Labs at Appalachian State Universityin North Carolina. “But the North Carolina university system demands contractual agreement that gives the primary investigator ‘academic</span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;">freedom’, or the right to publish the data, positive or negative. Many of the companies I work with are so convinced that their product has special effects that they sign these agreements.” What buyers should beware of are studies conducted in-house by companies, which are “close to worthless”, says Prof. Nieman. But while industry-funded doesn’t mean false, the anointed superfood might not be much better than a cheaper, less exotic equivalent that doesn’t have the same commercial imperative. The problem is not so much that superfoods are a con – many of them, like chia seeds (right) or kale,are highly nutritious – more that calling them ‘super’ gives unrealistic expectations of what they will do. “I prefer the concept of ‘high nutrient density’ foods, which is a central theme in the new 2015-2020 dietary guidelines for Americans,” says Prof. Nieman. “The term ‘superfood’ is not used by most scientists in the field, because the implication is that one can expect quick and high-end health benefits.” By all means, sprinkle some chia seeds on your oatmeal, and even stir in some blueberries. You’ll get a nutritional boost, you just won’t instantly become immortal: “What matters is the habitual eating pattern over months and years.”</span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: x-large;"><b>The goji berry boosts more vitamin C than oranges, more beta carotene than carrots and more iron than spinach</b></span></h3>
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<b><span style="font-family: "arial" , sans-serif;"><span style="font-size: x-large;">Many of superfoods are highly
nutritious, but calling them ‘super’ gives unrealistic expectations</span></span></b></h2>
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<span style="color: #0b5394; font-family: "arial" , "helvetica" , sans-serif;">A balanced diet</span></div>
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<span style="font-family: "arial" , "helvetica" , sans-serif;"> By seeing superfoods as a magic bullet, we risk shooting ourselves in the foot. “Some people think if they eat one ‘superfruit’, they don’t need to eat the recommended 2-4 servings of fruit a day,” says Dr. Blumberg. But no one superfood is a panacea; nor will it make up for other deficiencies. “Adding superfoods to a good diet is fine,” says Dr. David Katz, Director of Yale University’s Prevention Research Center in the US. “Counting on them to compensate for a bad diet is not.” And undue emphasis on superfoods can be unhealthy. “The term helps companies sell product, and it ‘helps’ consumers oversimplify their diets,”. All the experts cited here stressed the importance of consuming a wide variety of natural, ‘whole’ foods, which in turn reduces their individual significance. “No single food or beverage is important enough to stand out from the overall lifestyle,” says Prof. Nieman</span></div>
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<span style="color: #0b5394;">Inflated health benefits</span></span></h4>
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<span style="font-size: large;">The chia seed is a good example of how claims about superfoods can grow out of all proportion</span></span></h3>
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A variety of mint, over recent years chia has broken out of those novelty pet-shaped pot plants to become an Aztec warrior miracle food. It’s a complete protein with all the amino acids required to build muscle, plus more omega-3 than salmon, more fibre than flaxseed, and wealthier than Montezuma himself in antioxidants and minerals. Indeed, cheerleaders of chia allege you could eat it and nothing else. “It’s a good example of how companies and distributors promote the mystique and magical health benefits that go way beyond the science,” says Professor David Nieman, Director of the Human Performance Labs at Appalachian State University in North Carolina. “We conducted several randomised human trials showing that chia seeds provide good nutrition and can be included in a healthy eating pattern that over time – along with physical activity and weight management – is consistent with good health. But there’s nothing quick or miraculous about them.”</div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-91040533893249050632017-01-31T13:44:00.002+05:302017-01-31T13:44:33.035+05:30Centre must go full distance with cashless drive: Manappuram CEO<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Having taken the trouble
to demonetise higher denomination notes, the Centre should now think of going
the full distance in moving India towards a cashless economy, according to VP
Nandakumar, MD and CEO, Manappuram Finance, a leading gold loan company.<o:p></o:p></span></div>
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhvdaukob6Xz0UGP17hU-q6KEx568SheB3RqVYRJNcfSSvdaVgXm2wRTQVOqcaMjDkV-FbChj2xVeAFH8hhOcpXY8n5PW76tTEh8JoCck4kYlemJ6mxoCwBP7pnsnXN7SF456_GxQmigsZJ/s1600/BL16_14_NANDAKUMAR_2854374f.jpg" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="400" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhvdaukob6Xz0UGP17hU-q6KEx568SheB3RqVYRJNcfSSvdaVgXm2wRTQVOqcaMjDkV-FbChj2xVeAFH8hhOcpXY8n5PW76tTEh8JoCck4kYlemJ6mxoCwBP7pnsnXN7SF456_GxQmigsZJ/s400/BL16_14_NANDAKUMAR_2854374f.jpg" width="392" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><b>VP Nandakumar</b>, MD and CEO, Manappuram Finance</td></tr>
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<span style="font-size: 13pt;">Rather than adopt a
top-down approach, it should devise an incentive mechanism that rewards
cashless transactions, followed by some relatively mild disincentives on the
use of cash, Nandakumar said in his views on what he expects from Budget
2017-18.</span></div>
<o:p></o:p><br />
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<b><span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Lower
tax</span></b><span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Particularly helpful
would be a tax regime that levies a lower tax rate on cashless transactions.
Once people see the prospect of monetary gain from going cashless, they will
themselves seek out ways to get into cashless modes. Once positive incentives
are in place, the government may then consider disincentives, such as a tax on
cash withdrawal above a certain limit, which will then face less resistance.<o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">The idea of a permanent
withdrawal of all convenience fees, service charges and surcharges levied by
government agencies (like utility service providers and for various payments by
consumers to government) is worth implementing, Nandakumar said.<o:p></o:p></span></div>
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<b><span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Tax
on dividends</span></b><span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Budget 2016 had levied an
additional 10 per cent tax on gross dividends in excess of ₹10 lakh per annum.<o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">This tax is in addition
to the dividend distribution tax already paid by the company and amounts to
taxing the same income twice, Nandakumar said.<o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Further, if one considers
that dividends are paid out of the post-tax profit of a company, this measure
amounts to taxing the same income three times.<o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">“This is not fair and it
unnecessarily penalises the risk-taking entrepreneurial class who would have
ploughed their personal wealth and savings in their businesses. As it stands,
it is nothing but a tax on entrepreneurship and, therefore, should be revoked.”<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<b><span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Gold
loans</span></b><span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Until 2011, gold loans
given by NBFCs to eligible categories of borrowers (agriculture, MSME or
micro-loans) were considered as priority sector, which allowed NBFCs to obtain
refinance from banks on relatively better terms.<o:p></o:p></span></div>
<br />
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">The subsequent withdrawal
of priority sector status has pushed up borrowing costs for these borrowers as
banks lack last mile reach and have largely been unable to fill the gap,
Nandakumar said</span><span style="color: #3b3a39; font-family: "Georgia",serif; font-size: 10.5pt; mso-bidi-font-family: "Times New Roman"; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">.<o:p></o:p></span></div>
</div>
Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-66506165867813895692017-01-31T13:37:00.002+05:302017-01-31T13:37:56.101+05:30Much ado about fiscal deficit<div dir="ltr" style="text-align: left;" trbidi="on">
<h3 style="text-align: left;">
<span style="background-color: white;"><span style="font-family: Arial, Helvetica, sans-serif; font-size: large;">A Budget that spurs demand is the need of the hour. The view that fiscal stimulus crowds out private spending is questionable</span></span></h3>
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEglX7sd-ZX-XhOHqSm1h-GAn9ipUowoLb1XfZt3q2sv5Od8XV-dN_cQreMw5GuzYKG2x64onfn00D0xIuA621sBviyW0EA6PWbpyZQ2uxh7iforylf4koz3dl1FFdgSlhWWotm51C2vHQS9/s1600/BL31_MAIN1_THINK1_3125535f.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="270" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEglX7sd-ZX-XhOHqSm1h-GAn9ipUowoLb1XfZt3q2sv5Od8XV-dN_cQreMw5GuzYKG2x64onfn00D0xIuA621sBviyW0EA6PWbpyZQ2uxh7iforylf4koz3dl1FFdgSlhWWotm51C2vHQS9/s640/BL31_MAIN1_THINK1_3125535f.jpg" width="640" /></a></div>
<div>
<span style="background-color: white;"><span style="font-family: Arial, Helvetica, sans-serif; font-size: large;"><br /></span></span></div>
<div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Whatever may be the
actual recommendations of the NK Singh panel tasked to review the fiscal
consolidation roadmap, it has been widely agreed, by now, that the upcoming
Budget should focus on stimulus measures in order to boost domestic demand, improve
investments and pave the way for job-filled growth.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Demonetisation is
behind us and the withdrawal of cash has led to temporary problems of demand
compression with consequential impact on growth. But, if there is something
akin to the balance sheet of the economy, it can be seen that this is indeed
the moment for a path-breaking Budget that can induce a sharp recovery.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<b><span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">The balance sheet<o:p></o:p></span></b></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Budgets refer to income
and expenditure statements. But there is very little discussion around the
major elements of what could be construed to constitute the country’s balance
sheet. The UN has been bringing out the Inclusive Wealth Report (an exercise
which broadly looks at “manufactured capital, human capital, natural capital
and social capital” as a country’s assets and internal and external debt of the
government and private entities as liabilities) which had attempted to marry
essentially an accountant’s perspective with that of an economist.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">If one were to take
just the liabilities from this ‘balance sheet’, it would emerge that the
country is perhaps at an economic sweet-spot from where a jumpstart is
possible. Let us take external debt first. According to the latest report of
the Ministry of Finance, India’s external debt stock stood at $485.6 billion at
end-March 2016 as against $475.0 billion at end-March 2015. While external debt
has increased over 2015-16 by a small 2.2 per cent, important debt indicators
such as external debt-GDP ratio and debt service ratio remain comfortable.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Our external debt
continues to be dominated by long-term borrowings. The external debt policy
pursued by the Government has kept external debt within manageable limits.
India continues to be among the less vulnerable countries with its external
debt indicators comparing well with other indebted developing countries, as the
survey states. Of this debt, what is significant is that government debt is
only $93 billion in India’s case.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Further, the ratio of
short-term debt on the external front is a modest 18.5 per cent which means
that there is no reason for any anxiety on the debt-servicing front, at least
for the next year. Just for comparison purposes, it may be noted that China’s
share of short-term debt is 71.2 per cent though that is mitigated by its very
high reserves position.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<b><span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Government debt<o:p></o:p></span></b></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">As for short-term
government debt, it stands at a measly $108 million, indicating that concern on
the external debt front, as of now at least, is unwarranted. Our foreign
exchange reserves are at $359 billion.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">When it comes to total
government debt, the figure is ₹60, 33,464 crore including external debt. To
give an idea of the indebtedness of the country, it would be useful to compare
this with the total credit/ loans taken by all domestic entities inside India
from the banking system — it stands at about ₹76,00,000 crore. And one major
difference has been that whereas the Government has been borrowing at fixed
rates, all others are borrowing at floating rates.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">So, in a falling
interest rate regime, the Government has been effectively paying higher
interest!<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Our share of government
debt to GDP is at about 70 per cent and there are countries in the Euro Zone
which have these ratios closer to about 90 per cent. Of course, the percentages
in the case of Japan, the UK and the US are much higher.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">The obsession with
fiscal deficit is premised on two grounds, mainly. One, that budget surpluses
are a form of national saving, and two, that higher fiscal deficits would crowd
out private investments because of the pressure it would put on interest rates.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">There have been studies
and reports which have negated both theses empirically. One of them, based on
RBI data, conclusively stated that there is no significant relationship between
high fiscal deficits and high interest rates.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Anecdotal evidence is
also now on hand; banks have invested more in government debt than the SLR
requirement and still have liquid surplus to lend, which has forced them to
drop rates. At present, a 10-year government security has a yield of 6.7 per
cent, much lower than a one-year bank deposit rate.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Much of what can be
called “fiscal deficit fundamentalism” can be attributed to neo-classical views
which would fit western liberal economies. Thanks to our inclination to save
(net savings rate is about 31 per cent of GDP), government borrowing, per se,
need not be seen as a matter of concern.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;"><b>Fiscal fundamentalism</b><o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Of course, like any
other economic entity, our government also cannot perennially borrow and live
beyond its means. But to cling to numeric targets even when the crying need of
the hour is to boost demand and public investments (so that it will crowd in
private sector investments) would be detrimental to the growth trajectory that
we need to have to generate enough jobs.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Also, when monetary
policy is seemingly constrained by exchange rate considerations, fiscal
fundamentalism may have to be abandoned.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">Putting money in the
hands of the poor and the middle classes, making life easier for the distressed
farm sector and making for vibrancy in the small and medium businesses is
vital.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">The country’s economic
balance sheet seems strong and resilient enough to afford the Government
‘space’ to be accommodative enough to spur growth impulses, without going
overboard on fiscal loosening.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt;">The writer is with the
State Bank group. The views are personal<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal;">
</div>
<div class="MsoNormal" style="line-height: normal; text-align: justify;">
<br /></div>
</div>
</div>
Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-57007109951624327712017-01-31T12:32:00.001+05:302017-01-31T12:32:13.634+05:30India plan: Hitachi Data bets on digitisation, smart city projects<div dir="ltr" style="text-align: left;" trbidi="on">
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg1sQd7g26nidh43rbv3KPgCIKXuf1nWF6vv-Voycs7AMtCcFHYhqq8olAl7QP1tRpPH6hio-Zmx2r1NFEkqjIYzRB7TUvYYi_vql-eCXV_P_9R3Yjg9vtesvly5HrB9GP9MgrL0vcmIZQ9/s1600/BL31_IT_HITACHI_3125555f.jpg" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="372" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg1sQd7g26nidh43rbv3KPgCIKXuf1nWF6vv-Voycs7AMtCcFHYhqq8olAl7QP1tRpPH6hio-Zmx2r1NFEkqjIYzRB7TUvYYi_vql-eCXV_P_9R3Yjg9vtesvly5HrB9GP9MgrL0vcmIZQ9/s400/BL31_IT_HITACHI_3125555f.jpg" width="400" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><b>Russell Skingsley, </b>Chief Technology Officer, Asia Pacific, Hitachi Data Systems</td></tr>
</tbody></table>
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;"><span id="goog_1234234523"></span><span id="goog_1234234524"></span><br /></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">“A
country with a billion people, a large democracy, a desire to transform,
modernise and standardise, it will be crazy not to have India on high
priority,” said Russell Skingsley, Chief Technology Officer (Asia Pacific),
Hitachi Data Systems (HDS). HDS is a wholly-owned subsidiary of $90-billion
Hitachi of Japan. It has been in India for the last 15 years and has over 600
customers.<o:p></o:p></span></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Digitisation,
focus on investments in manufacturing, smart cities and skilling, the four
major programmes of the government will drive a huge demand for cloud,
analytics and Internet of Things, he told Business Line. Last year, HDS India,
which works with system integrators such as Infosys, Wipro, Tata Consultancy
Services, Cognizant and Tech Mahindra, witnessed a 39 per cent revenue growth,
said its Managing Director Vivekanand Venugopal, without giving any number.<o:p></o:p></span></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">“India
is getting better to do business. This is going to be India’s advantage. But,
of course, there will be always location-based challenges, and that where we
rely on local partners who understand the environment,” said Skingsley.<o:p></o:p></span></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">With
over 100 smart cites to be implemented in India, HDS will play a significant
part in this. The company has already won a couple of projects, he said.<o:p></o:p></span></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">An
area of expertise that HDS has is in video analytics.<o:p></o:p></span></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Normally,
people will monitor from a room full of screens. However, in video analytics,
machines understand behaviour from video feeds and provide alerts. For
instance, detecting people dumping something in an area where it he should be
not be done.<o:p></o:p></span></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<br /></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Blend
of IoT and operational technology is another opportunity for HDS which along
with Hitachi won a project from British Rail Network to provide high speed
train replacement. Hitachi will be paid on punctuality of train service. To
achieve high level of efficiency and punctuality, IoT was built into the system
with every single rail path having around 25,000 sensors. The sensors aggregate
data and sendit in real time to a centre to analyse various aspects of the rail
network, he said.<o:p></o:p></span></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<br /></div>
<br />
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Such
IoT projects will be done in future where IT, data analysis and connectivity
will be built in large scale infrastructure projects. India is really a fertile
kind of environment for such projects, Skingsley said.<o:p></o:p></span></div>
</div>
</div>
Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-55077039331403064982017-01-31T12:23:00.000+05:302017-01-31T12:32:34.346+05:30Centre puts ‘green bank’ listing on hold as winds deemed unfavourable<div dir="ltr" style="text-align: left;" trbidi="on">
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">The government intention
to list India's green bank – the Indian Renewable Energy Development Agency
(IREDA) – is not likely to happen for at least a year as the public sector
undertaking faces rough weather both at home and abroad.<o:p></o:p></span></div>
</div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Company officials say
they want to wait for the market to stabilise before approaching the bourses,
to ensure better valuation for the company.<o:p></o:p></span></div>
</div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjNcrQmJHIHOlC-PoQT2tXEtJBy3vqzU-O5gM6D1mf-7agEbt1yqokh0gfejykKYKdX8wWfxCy64RO5p2VOCMYd4gaZRaM1izOMZGYA6NepdnwYKat0zaN6H6nLGiRqJ8GKKr0avF14E665/s1600/EarthTalkWindPowerNIMBY-700221-300x198.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="420" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjNcrQmJHIHOlC-PoQT2tXEtJBy3vqzU-O5gM6D1mf-7agEbt1yqokh0gfejykKYKdX8wWfxCy64RO5p2VOCMYd4gaZRaM1izOMZGYA6NepdnwYKat0zaN6H6nLGiRqJ8GKKr0avF14E665/s640/EarthTalkWindPowerNIMBY-700221-300x198.jpg" width="640" /></a></div>
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<b><span style="background: white; color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Challenges</span></b><span style="font-family: "arial" , sans-serif; font-size: 13.0pt;"><o:p></o:p></span></div>
</div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">The falling interest
rates and the rise of competing clean energy financing by banks are threatening
returns of the PSU back home. Besides, US President Donald Trump’s policies
have raised the cost of hedging for IREDA.<o:p></o:p></span></div>
</div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Officials say the burden
of Trump’s policy of closing down the American economy to encourage domestic
manufacturing has been reflecting on the rupee. According to December 2016
rating of Moody's Investors Service, multilateral agencies accounted for around
55 per cent of IREDA's total borrowings as of March 31, 2016.<o:p></o:p></span></div>
</div>
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<b><span style="background: white; color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Rupee depreciation</span></b><span style="font-family: "arial" , sans-serif; font-size: 13.0pt;"><o:p></o:p></span></div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">The rupee has depreciated
1.8 per cent over the past three months (since October 30, 2016), putting
additional strain on IREDA, when it will have to repay the foreign sourced
fund.<o:p></o:p></span></div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Currently, IREDA raises
funds from international development agencies such as the German
government-owned KfW and Asian Development Bank. IREDA also builds its corpus
by issuing bonds for clean energy development projects. It hedges its borrowing
in foreign currency denominated financial instruments.<o:p></o:p></span></div>
</div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">As the Indian currency
depreciates, IREDA will have to shell out more for hedging or have to pay back
a much higher amount to its borrowers. But, this is just the tip of the iceberg
for IREDA. Company officials told <i>BusinessLine </i>that Indian
banks are eyeing to take over the loans disbursed by IREDA. Clean energy
projects have assured offtake over a period of 25 years and banks are looking
to take over these committed loan accounts.<o:p></o:p></span></div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">A senior official said,
“The banks are attempting to poach loan accounts buoyed by the prospects of
assured returns. Banks are offering customers a lower interest rate from
IREDA’s rate.”<o:p></o:p></span></div>
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<b><span style="background: white; color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Assets valuation</span></b><span style="font-family: "arial" , sans-serif; font-size: 13.0pt;"><o:p></o:p></span></div>
</div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">The company reported
consolidated assets of ₹13,200 crore (around $2.0 billion) in June last year.
The takeover will allow faster repayment of debt, boosting IREDA’s immediate
cash profile. This will, however, result in a loss of earning from interest
that IREDA had estimated while disbursing the loans.<o:p></o:p></span></div>
</div>
<div style="text-align: justify;">
<br /></div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">IREDA will thus earn less
from the loans it disbursed and will have to pay back more to the international
development financing institutions it borrowed from.<o:p></o:p></span></div>
</div>
</div>
Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-58436217926669263902017-01-03T16:34:00.000+05:302017-01-03T16:34:07.439+05:30Hybrid annuity road projects face financial closure hurdles<div dir="ltr" style="text-align: left;" trbidi="on">
<h3 style="text-align: left;">
<span style="font-family: Arial, Helvetica, sans-serif; font-size: large;"><b>Out of the 26 hybrid annuity model projects awarded this fiscal, about four-five may get scrapped due to inability of the developer to invest equity or bring in debt</b></span></h3>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">Some of the road projects under the new hybrid annuity
model (HAM) that attracted aggressive bidding this fiscal year are struggling
to achieve financial closure as banks remain cautious, developers and analysts
said.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">Under HAM, the government commits up to 40% of the project
cost over a period and hands the project to the developer. The developer has to
fund the balance with debt and equity, and is paid annuity income in
instalments. The model was designed to make it safe for banks and investors.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">Satish Parakh, managing director at roads developer Ashoka
Buildcon Ltd, said some lenders are “not happy” with the hybrid annuity model.
“Some of the banks are refusing to finance on the basis of those documents, and
only a few banks are coming forward for the hybrid annuity model. They have
some reservations which they are discussing with the NHAI. The other part is
that some companies are finding it difficult to put equity,” said Parakh said.
He added the company had achieved financial closure of its HAM project.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">Like all public-private-partnership (PPP) projects, HAM
projects too are facing issues with financial closure, said K. Ramchand,
managing director, IL&FS Transportation Networks Ltd (ITNL). ITNL, which
has the largest portfolio of build, operate and transfer (BOT) road projects,
has bid for HAM projects in various states but not announced a win so far.<o:p></o:p></span></div>
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<br /></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">Out of the 26 HAM projects awarded this fiscal, about
four-five could get scrapped due to inability of the developer to invest equity
or bring in debt, said an analyst, asking not to be named as he is not
authorized to speak to reporters. Large banks such as State Bank of India (SBI)
and Axis Bank are selectively funding HAM projects even as many companies
continue to bid for and win such projects, according to this analyst. SBI and
Axis Bank did not respond to email queries sent on Thursday.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">“Earlier, banks were slightly reluctant with funding hybrid
annuity projects, especially for developers with weak balance sheets and lack
of construction experience. They (banks) were taking longer time than usual to
assess HAM projects as they wanted to understand the new business model.
However, in the recent weeks, a lot of companies including Welspun, MEP Infra
and Sadbhav have been able to achieve financial closure for their hybrid
annuity projects,” said IIFL Wealth analyst Alok Deora.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">On 2 December, Deora had said in a report that certain
small developers had failed to receive financial closure for their HAM
projects, which were consequently cancelled.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">The government’s push for new low-risk HAM awards to
kick-start private sector investments has led to the emergence of a number of
smaller, regional companies that have added to the sector’s competitive
intensity, according to road developers and analysts. The increase in awards of
projects under the government-funded engineering, procurement, and construction
(EPC) model too has driven up bidding aggression.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">Companies including Sadbhav Infrastructure Projects Ltd,
Welspun Enterprises Ltd, and Ashoka Buildcon have been able to tie up loans and
submit their financial closure details to NHAI. MEP Infrastructure Developers
Ltd has been able to achieve financial closure for two of its projects with two
others yet to be closed, while PNC Infratech Ltd and Dilip Buildcon Ltd are
expecting to achieve financial closure by March. Some other companies such as
MBL Infrastructures Ltd, APCO Infratech Pvt. Ltd, Oriental Structural Engineers
Pvt. Ltd and GR Infraprojects Ltd, are yet to achieve financial closure of their
won projects, according to channel checks of the firms.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">“A concern in the roads sector today is that there is huge
aggression even though the number of players is less. The job being bid out are
quite large, but theirs is no comfortable participation and instead, there is a
lot of aggression. And that will lead to execution challenges,” Ashoka
Buildcon’s Parakh said.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">Road projects in India have always been awarded in one of
the three formats—BOT annuity, BOT toll and EPC. In BOT annuity, a developer
builds a highway, operates it for a specified duration and transfers it to the
government, which pays the developer annuity over the concession period. Under
BOT toll, a concessionaire generates revenue from the toll levied on vehicles
using a road. In EPC, the developer builds with government money.<o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 12.0pt; line-height: 107%;">India has set a target to award 25,000km of road projects
in FY17 under the ministry of road transport and highways and National Highway
Authority of India (NHAI), compared to 10,000km achieved in FY16.<o:p></o:p></span></div>
</div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-47105975764734342652016-11-07T17:32:00.001+05:302016-11-07T17:32:51.532+05:30RBI's Overseeing Committee approves 1st ever S4A scheme to HCC Ltd<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">The Overseeing Committee of
the Reserve Bank of India (RBI) has given its approval for the Scheme for
Sustainable Structuring of Stressed Assets (S4A) for Hindustan Construction
Company, the latter said in a notification to the BSE on Sunday.<o:p></o:p></span></div>
<div style="background: white; box-sizing: border-box; line-height: 22pt; margin: 0in 0in 7.5pt; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">The move has made HCC the first
company to get an approval by the RBI's Overseeing Committee, it said.<o:p></o:p></span></div>
<div style="background: white; box-sizing: border-box; line-height: 22pt; margin: 0in 0in 7.5pt; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">HCC has a total funded debt of Rs
5,107 crore, which has been considered under the S4A scheme. The debt will be
divided into two -- sustainable and unsustainable debt.<o:p></o:p></span></div>
<div style="background: white; box-sizing: border-box; line-height: 22pt; margin: 0in 0in 7.5pt; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">The Part A or the sustainable debt,
according to the company, will be of Rs 2,681 or 52.50% of the total debt.<o:p></o:p></span></div>
<div style="background: white; box-sizing: border-box; line-height: 22pt; margin: 0in 0in 7.5pt; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">The Part B or the unsustainable
debt, will be Rs 2,426 crore or 47.50% of the total debt.<o:p></o:p></span></div>
<div style="background: white; box-sizing: border-box; line-height: 22pt; margin: 0in 0in 7.5pt; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">According to the notification,
"the lenders will subscribe to 24.44% fresh equity (Rs 1,008 crore
assuming Rs 40 rate) which will bring down the promoter holding from 36.07% to
27.44% The share price will be determined as per Sebi guidelines and
accordingly, the debt will go down to the extent of the conversaion amount.<o:p></o:p></span></div>
<div style="background: white; box-sizing: border-box; line-height: 22pt; margin: 0in 0in 7.5pt; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">"The balance portion of Part
B, will be converted into Optionally Convertible Debentures for ten years with
coupon @0.01%, 11.5% YTM," it said.<o:p></o:p></span></div>
<div style="background: white; box-sizing: border-box; line-height: 22pt; margin: 0in 0in 7.5pt; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Commenting on the development, HCC
Group CEO Praveen Sood, said, "The S4A scheme will help the company bridge
the gap of 'Cashflow Timing Mismatch' between claims realisation (including its
interest) and debt servicing.<o:p></o:p></span></div>
<div style="background: white; box-sizing: border-box; line-height: 22pt; margin: 0in 0in 7.5pt; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">"The move comes at an
opportune time as HCC is already on recovery path with order book growth of
over 30% in last one year. We feel that it's a positive move for HCC and will
bring sustained long term solution for the company."<o:p></o:p></span></div>
<div style="background: white; box-sizing: border-box; line-height: 22pt; margin: 0in 0in 7.5pt; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">HCC's shares will be in focus today
on the bourses. On Friday, the company's shares had closed at Rs 34.45. In
pre-open hours,<o:p></o:p></span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-29863255373796652392016-10-27T15:23:00.000+05:302016-10-27T15:23:00.602+05:30Business Standard Banking Round Table, 2016<div dir="ltr" style="text-align: left;" trbidi="on">
<h3 style="text-align: justify;">
<span style="font-size: large;"><span style="font-family: Arial, Helvetica, sans-serif;"><span style="line-height: 107%;">Business Standard Banking
Round Table, 2016, started on Thursday.</span></span><span style="font-family: Arial, Helvetica, sans-serif;"><span style="line-height: 107%;">Here are the highlights of
what the top banking honchos said: </span></span></span></h3>
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<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">1) The one thing striking
about the banking side in concentration of assets and liabilities, said IDFC
Bank MD & CEO Rajiv Lall<o:p></o:p></span></div>
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<br /></div>
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<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">2) IDFC Bank's Rajiv Lall said
that 45 per cent of all outstanding advances were made to only 300 corporates. <o:p></o:p></span></div>
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<br /></div>
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<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">3) Rajiv Lall pointed out that
60 per cent of India's household savings were still outside the financial
system.<o:p></o:p></span></div>
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<br /></div>
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<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">4) Union Bank of India CMD
Arun Tiwari said that there is a perception advantage in terms of which bank is
a retail bank and which is involved in corporate lending. <o:p></o:p></span></div>
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<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">5) Axis Bank MD & CEO
Shikha Sharma said that credit growth to the corporate sector was relatively
weak and that working capital demand has also been depressed.<o:p></o:p></span></div>
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<br /></div>
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<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">6) Shikha Sharma added that
there have been no new projects in the last 18 months and working capital
demand has also been depressed.<o:p></o:p></span></div>
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<br /></div>
<div class="MsoNormal" style="text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">7) Axis Bank's Sharma pointed
out that the retail and small and medium-sized enterprises sectors were showing
demand. However, she cautioned that there was worry over whether that is the
next bubble.<o:p></o:p></span></div>
<div class="MsoNormal" style="text-align: justify;">
<br /></div>
<div class="MsoNormal" style="text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">8 )Chandra Kochchar, the head
of ICICI Bank highlighted that it's imperative for banks to become agile and
active to keep evolving their business models. A cause of concern is that loan
against property and unsecured loans appears to be growing at a fast pace, she
added. Kocchar also said the next round of credit growth will come from the
secondary impact of all the government spends.<o:p></o:p></span></div>
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<br /></div>
<div class="MsoNormal" style="text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">9) Aditya Puri of HDFC Bank
pointed out that the government, banks and the Reserve Bank of India are very
clear that they're not in the business of charity. If money has been borrowed,
it must be given back, he said.<o:p></o:p></span></div>
<div class="MsoNormal" style="text-align: justify;">
<br /></div>
<div class="MsoNormal" style="text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">10) Pramit Jhaveri of Citibank
thinks technology is going to be the
biggest driver for banking."India is among most attractive destinative as
far as financial services industry is concerned," said Jhaveri.<o:p></o:p></span></div>
<div class="MsoNormal" style="text-align: justify;">
<br /></div>
<div class="MsoNormal" style="text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">11) Chanda Kocchar of ICICI
Bank said infra projects will be funded partly by banks and partly by other
means such as bonds. This means that project finance will get more structured
before money is committed towards a particular project.<o:p></o:p></span></div>
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<br /></div>
<br />
<div class="MsoNormal" style="text-align: justify;">
<span style="font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%;">12) She also said robotics
have reduced the bank's error rates and
response time to consumers<o:p></o:p></span></div>
</div>
Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-83973266821039688762016-10-25T13:00:00.002+05:302016-10-25T13:00:37.834+05:30India’s elusive bond market<div dir="ltr" style="text-align: left;" trbidi="on">
<h3 style="text-align: left;">
<span style="background-color: white;"><span style="font-family: Arial, Helvetica, sans-serif; font-size: large;">The expectation that financial liberalisation would lead to a proliferation of non-bank financial companies and an expansion of the bond market in India has been belied</span></span></h3>
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiaPIEIPXO6tNyC97pAHLbf4XxZ2Zv3xKifZMQLiwLlfyCuiEONDFONruPk_n9lMBzhQ-vR3b2xm6IoQVGeLd8amKQ95yRnsZAgEkjyOj6AfipRzrrFA6TtKQNxKFt6FZZ652Ed1Vu4i64L/s1600/jayati-horz.jpg" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="200" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiaPIEIPXO6tNyC97pAHLbf4XxZ2Zv3xKifZMQLiwLlfyCuiEONDFONruPk_n9lMBzhQ-vR3b2xm6IoQVGeLd8amKQ95yRnsZAgEkjyOj6AfipRzrrFA6TtKQNxKFt6FZZ652Ed1Vu4i64L/s400/jayati-horz.jpg" width="400" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><span style="font-family: Arial, Helvetica, sans-serif; font-size: small;"><b> Jayati Ghosh C.P Chandrashekhar</b></span></td></tr>
</tbody></table>
<div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">In recent times, much
concern has been expressed about the poorly developed corporate bond market in
India, which is seen as hampering the financing of long term investment. There
is much evidence to suggest this is indeed true.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">As Chart 1 shows, in
2014, the ratio of loan liabilities (largely to the banking system) in the
total of loan, note and bond liabilities was way higher in India than in its
Asian counterparts and relative to its partners in the BRICS grouping.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">What is more, the
increase in bond financing relative to the expansion in bank credit in the
period between 2009 and 2014 (or after the global financial crisis) was much
lower in India than in most other emerging markets of relevance, excluding
Indonesia (Chart 2).<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<b><span style="background: white; color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">An era has ended</span></b><span style="font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">This lethargy in India’s
bond market is not because of the absence of any effort on the part of the
government to promote that market. In fact, the government has also held the
view that a vibrant bond market is a prerequisite for the financing of
long-term investment in the post-liberalisation period.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">In the past a large part
of such financing was supported with allocations from the budget in the case of
public sector projects or with credit from the development finance institutions
(DFIs) for private projects. The DFIs themselves were supported with
concessional funds from the RBI and the government, especially the former,
which had a separate window for the purpose. That era has, however, ended.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">The government’s failure
to mobilise adequate resources through taxation and its post-reform emphasis on
fiscal consolidation, which limits its borrowing, has reduced its capital
spending.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">This requires the private
sector to play a greater role in capital intensive industries and
infrastructure. On the other hand, a consequence of Indian-style financial
liberalisation has been the conversion through reverse merger of the DFIs into
regular commercial banks.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">ICICI Bank and IDBI Bank
are all that is left of the erstwhile all-India development financing
infrastructure. This has meant that the burden of financing private investment
in capital intensive areas including infrastructure has fallen on the
commercial banks, especially the public sector banks.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">However, the maturity and
liquidity mismatches between the funds sourced by the commercial banks and
investments in large industrial and infrastructural projects has resulted over
time in rising non-performing assets in the books of these banks. So they too
are retreating from financing of investment in these areas.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Hence, besides foreign
borrowing, a liquid bond market has become the only possible alternative to
clear this financing bottleneck and support such investment.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">To realise that
alternative, investors looking for long term investment opportunities and
offered the expected yield and the required liquidity as insurance have to be
brought to market in adequate numbers.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Unfortunately, the
penetration of the corporate bond market is almost marginal in the Indian
financial sector. In 2014, while the ratio of bank deposits to GDP stood at 64
per cent, and that of domestic credit to the private sector at 52 per cent, the
ratio of outstanding corporate bonds to GDP was only 14 per cent.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">By the end of 2015 while
corporate bond penetration in India was at around 17 per cent of GDP, the
figure was close to 45 per cent in Malaysia and 75 per cent in South Korea.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Moreover, at the end of
2015, government securities (G-Secs, State Development Loans and Treasury
Bills) accounted for 72 per cent of value of outstanding bonds, with corporate
paper (bonds, commercial paper and certificates of deposit) contributing the
balance 28 per cent.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<b><span style="background: white; color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Liberalisation fallout</span></b><span style="font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">The weakness of the bond
market is partly the result of a larger failure of the financial liberalisation
agenda. This was the failure to ensure the transition away from a bank
dominated system, through a proliferation of non-bank financial institutions
(NBFIs) that may have turned to the bond market for investment opportunities.
As Chart 3 shows, when compared with South Africa, Brazil and Korea, the
relative importance in terms of asset shares of NBFIs such as insurance
companies, pension funds and other financial institutions was much lower in
India.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">This has been a
bottleneck to the entry of saving households into the bond market (and more so
the retail market for equity). The global evidence is quite clear that small
investors are exposed to the debt market through institutions like mutual
funds, insurance companies and pension funds. So the government’s effort seems
to be to use the latter as means to bring a larger share of household savings
into the corporate bond market.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">It has done this in the
past by persuading public sector insurance companies and pension funds to
allocate a larger share of their investments to the market for corporate bonds.
In addition, under the new pension scheme of the government, subscribers are required
to choose some level of risk exposure as part of a move from defined benefit to
defined contribution schemes. But, given the fiduciary obligations of
investment managers in these funds, they tend to be cautious when following
government advice.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Further, the relative
importance of these institutions is far less than in many other countries. That
does not help strengthen the corporate bond “market”.<o:p></o:p></span></div>
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgpZ2poPYIaiy2yTVLB4k0AffY3eQd2cxuYDfju9I9ej1QYG7ZZ4BjhOZtJLXdkpfy4pXAAR0g2JNNkv33LMPVs-qNehyrvo8JAZhrVJgYhYTNVZuLsiX0RWdTl3YbAZ28qfVy3b0-oC_M3/s1600/brokenlink.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="378" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgpZ2poPYIaiy2yTVLB4k0AffY3eQd2cxuYDfju9I9ej1QYG7ZZ4BjhOZtJLXdkpfy4pXAAR0g2JNNkv33LMPVs-qNehyrvo8JAZhrVJgYhYTNVZuLsiX0RWdTl3YbAZ28qfVy3b0-oC_M3/s400/brokenlink.png" width="400" /></a></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><br /></span></div>
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<b><span style="background: white; color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Bank dependence</span></b><span style="font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">The Reserve Bank of India
has in recent times attempted to respond to this through a host of measures.
But the most important of those strengthens the problem of “bank dependence”.
Banks are being roped in to render bonds less risky by extending the already
existing partial credit enhancement (PCE) scheme. In September 2015, the RBI
introduced a scheme under which banks were allowed to provide partial credit
enhancement to bonds issued by corporate entities and special purpose vehicles.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">This involves providing a
non-funded but irrevocable line of credit linked to a bond issue, which
companies can access to meet commitments in case they find themselves unable to
meet interest or amortisation payments on the bonds. There were conditions set
on this facility including the requirement that the rating of the bond issue
must be “BBB minus“ or better before the credit enhancement and that the
aggregate PCE provided by all banks to any bond issue cannot exceed 20 per cent
of the bond issue size.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">The essential aim of the
PCE scheme is to reduce the risk associated with a bond and enhance its rating.
With the banks taking over part of the risk, the bonds can be upgraded to
investment grade, making them eligible for purchase by insurance and pension
funds.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15.0pt;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">The new measure
implemented also increases the aggregate PCE exposure of the financial system
to any bond issue to 50 per cent (from 20 per cent) of the size of the issue,
with a ceiling of 20 per cent on the exposure of any single bank. Measures such
as this, it is hoped, will help resolve a problem, which has been created by
the government’s own policies, of an unavoidable dependence for finances on a
market that is still to mature. But in the process it is exposing banks,
insurance companies, pension funds, and those who place their savings in these
institutions to increased risk.<o:p></o:p></span></div>
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjXm6Sl0DYb2QG3q8JLby7SstLxsIqY9TTkp48EmCslUk_beCTl4o4TSRc6V-j2MxrQWLJ5Pm-TX8Uba7QypdPzYoUCX_PldYPCPO_kg7kcPw_l-0CcQLYVKs3VZJizpelDlh4ihJozdBi0/s1600/bond-1_3056696g.jpg" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="235" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjXm6Sl0DYb2QG3q8JLby7SstLxsIqY9TTkp48EmCslUk_beCTl4o4TSRc6V-j2MxrQWLJ5Pm-TX8Uba7QypdPzYoUCX_PldYPCPO_kg7kcPw_l-0CcQLYVKs3VZJizpelDlh4ihJozdBi0/s320/bond-1_3056696g.jpg" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><b><span style="font-family: Arial, Helvetica, sans-serif; font-size: small;">Banks dominate in India</span></b></td></tr>
</tbody></table>
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjaM9Bk3WOn7KNCR2Qsax1M2WJsjA2nxo1EOtNBEJLf2aoZ1NTjMRnQRj6kWycn8lu79FejV414HMsg3yKdkerl8dn4ZVq13WaZW0FNv6BlDiVAYZxrOCzuv5U3bNdCi3LgNEAe6i05QT89/s1600/bond-2_3056698g.jpg" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="232" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjaM9Bk3WOn7KNCR2Qsax1M2WJsjA2nxo1EOtNBEJLf2aoZ1NTjMRnQRj6kWycn8lu79FejV414HMsg3yKdkerl8dn4ZVq13WaZW0FNv6BlDiVAYZxrOCzuv5U3bNdCi3LgNEAe6i05QT89/s320/bond-2_3056698g.jpg" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><span style="font-family: Arial, Helvetica, sans-serif; font-size: small;"><b>Tepid market for bonds</b></span></td></tr>
</tbody></table>
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiFlh-SAnhp4U3ZdshIdmqy35CfWCX0DHav_8SQt7HEBwnAl7UFJDosvvAq3QMGOZ25vzZUeVa5zlp5EF6_VPzNrgDMbbZtytMiFzoDNUnhCEhT55w2O1TVWVk0u4ecbYbeBVWShCIrVrpv/s1600/bond-3_3056700g.jpg" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="232" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiFlh-SAnhp4U3ZdshIdmqy35CfWCX0DHav_8SQt7HEBwnAl7UFJDosvvAq3QMGOZ25vzZUeVa5zlp5EF6_VPzNrgDMbbZtytMiFzoDNUnhCEhT55w2O1TVWVk0u4ecbYbeBVWShCIrVrpv/s320/bond-3_3056700g.jpg" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><span style="font-family: Arial, Helvetica, sans-serif; font-size: small;"><b>The NBFC boom hasn't happened</b></span></td></tr>
</tbody></table>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-62100413367721361872016-10-21T18:13:00.002+05:302016-10-21T18:13:33.518+05:30Discom losses to halve by FY19: CRISIL<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: large;">Risk profile of discoms in UDAY states to improve, says the ratings agency</span></h3>
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<span style="background: white; font-family: Arial, sans-serif; font-size: 13pt;">Ratings agency <a href="http://www.business-standard.com/search?type=news&q=Crisil" target="_blank"><span style="color: black; text-decoration: none; text-underline: none;">CRISIL </span></a>estimates the aggregate ‘gap’ or loss of power
distribution companies (discoms) in the 15 states that have joined the Ujwal
Discom Assurance Yojana (UDAY) would more than halve to 28p a unit by 2018-19.<br />
<br />
The gap, calculated as average revenue realised minus average cost of supply,
was 64p a unit in FY16. Consequently, aggregate losses of these <a href="http://www.business-standard.com/search?type=news&q=Discoms" target="_blank"><span style="color: black; text-decoration: none; text-underline: none;">discoms </span></a>are seen declining by 46 per cent, to Rs 20,000
crore from Rs 37,000 crore now.<o:p></o:p></span></div>
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The gap will still be well above the ‘nil’ envisaged under UDAY, as some states
with very high aggregate technical and commercial losses aren't well prepared
to reduce it. The reasons include inadequate feeder separation, feeder and
distribution transformer metering, and a poor record on other efficiency
parameters.<br />
<br />
Also, with elections due in some within 12 months, their room to raise rates is
restricted. Cross-subsidisation is also high.<br />
<br />
Says Gurpreet Chhatwal, business head, large corporates, at CRISIL:
''Rajasthan, Haryana, Chhattisgarh, and Uttarakhand are expected to fare better
in <a href="http://www.business-standard.com/search?type=news&q=Uday" target="_blank"><span style="color: black; text-decoration: none; text-underline: none;">UDAY </span></a>implementation and likely to be the biggest
beneficiaries. UP, Bihar and Jammu & Kashmir are expected to be laggards.
These three states would account for almost two-thirds of the gap in FY19.
Concerted effort by them will be critical to narrowing the future gap.''<br />
<br />
<a href="http://www.business-standard.com/search?type=news&q=Crisil" target="_blank"><span style="color: black; text-decoration: none; text-underline: none;">CRISIL </span></a>says the energy requirements of <a href="http://www.business-standard.com/search?type=news&q=Discoms" target="_blank"><span style="color: black; text-decoration: none; text-underline: none;">discoms </span></a>are expected to increase at a compound annual
rate of seven per cent by FY19, compared with around four per cent till FY16.
New signing of long-term power purchase agreements (PPAs) seems unlikely, with
25,000 Mw of capacities with already-signed PPAs to be operational by FY19.
There will also be some pick-up in plant load factors at existing units, with
better fuel availability.<br />
<br />
Any uptick in long-term PPA signings is possible only if <a href="http://www.business-standard.com/search?type=news&q=Discoms" target="_blank"><span style="color: black; text-decoration: none; text-underline: none;">discoms </span></a>turn profitable by FY19 and strive to meet the
government’s ‘Power for all’ objective.<br />
<br />
Over the past year, initiatives to increase coal production, and the 5:25
refinancing scheme of the Reserve Bank of India have reduced operational
capacities at risk by 6,000 Mw, to 40,000 M2 from the 46,000 Mw that <a href="http://www.business-standard.com/search?type=news&q=Crisil" target="_blank"><span style="color: black; text-decoration: none; text-underline: none;">CRISIL </span></a>had earlier flagged.<br />
<br />
Says Sudip Sural, senior director at the agency: ''While lack of fresh
long-term PPAs continues to impact generation capacities, facilitation of
medium-term PPAs and corresponding coal linkages, continued focus on augmenting
domestic coal production, and facilitation of open access by states can help
further reduce the capacities at risk.''<br />
<br />
As for under-construction thermal projects, <a href="http://www.business-standard.com/search?type=news&q=Crisil" target="_blank"><span style="color: black; text-decoration: none; text-underline: none;">CRISIL </span></a>estimates 24,000 Mw of capacities face viability
issues. Of these, 13,000 Mw face commissioning risks because of weak sponsors.
The others have to address poor offtake by <a href="http://www.business-standard.com/search?type=news&q=Discoms" target="_blank"><span style="color: black; text-decoration: none; text-underline: none;">discoms </span></a>or inadequate fuel arrangements. A third of
capacities with weak sponsors can be revived through debt restructuring or sale
to a new sponsor..<o:p></o:p></span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-25418398280268323762016-10-21T18:09:00.003+05:302016-10-21T18:09:59.841+05:30Coking coal price on fire as supply fizzles out<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">The last time the world
saw such a spike in coal prices was during the boom time more than four years
ago.<o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">No boom is in sight, yet
both thermal and metallurgical coal prices have been soaring for the last three
months. Supply shortages appear to be the proximate cause.<o:p></o:p></span></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiUEZUg26SKaXjfh2sEnvu4kFqPgal7_d3Hxarn-bAyJ2o8CSrb6rUOvPd-nzZ7VaP_RIVnVuce42IdDOMGhKXtXi-U4Kh2ZH-UzlCXv2mTDFFq2N9fMTMBmnb9W0v577HTU9hIZ3GX-6Ld/s1600/china_coal_renewables2.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="356" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiUEZUg26SKaXjfh2sEnvu4kFqPgal7_d3Hxarn-bAyJ2o8CSrb6rUOvPd-nzZ7VaP_RIVnVuce42IdDOMGhKXtXi-U4Kh2ZH-UzlCXv2mTDFFq2N9fMTMBmnb9W0v577HTU9hIZ3GX-6Ld/s640/china_coal_renewables2.jpg" width="640" /></a></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><br /></span></div>
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<b><span style="background: white; color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Price variation</span></b><span style="font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">According to India Coal
Market Watch (ICMW), from July 1, the most popular variety of Indonesian
thermal coal (4,200 Kcal) has turned pricier by nearly 38 per cent at $40 a
tonne. South Africa (6,000 kcal) thermal coal price is up 48 per cent at
$83/tonne.<o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Power plants along
India’s coast use the first variety and cement kilns, the second.<o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">But the big surprise has
been in coking, or metallurgical, coal used by steel-makers. From July 1,
Australian coking coal prices have shot up two-and-half 5 times to $230 a
tonne, surprisingly at a time when the world steel industry is passing through
one of the worst phases with China cutting down 100 million tonnes capacity.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">According to ICMW, Indian
steel plants have booked coking coal for the October-December quarter at $200 a
tonne, as against $93/tonne in the July-September quarter. Though India is world’s
fourth largest coal producer, it has very limited coking coal reserves.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; margin-bottom: 0.0001pt; text-align: justify;">
<b><span style="background: white; color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Supply constraint</span></b><span style="font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></div>
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<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">According to Deepak
Kannan, Managing Editor (Asia Thermal Coal) of <i>Platts</i>, the primary
driver of this spike is China, which is world’s leading producer and consumer
of both thermal and coking coal.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Earlier this year,
Beijing decided to cut the annual working days in mines to 270 days from 330.
This had no significant impact on global prices till June as India stepped up
production significantly and cut imports.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">India is still flush with
coal and there has been no supply disruptions from Indonesia, yet thermal coal
prices started to skyrocket from July on Chinese buying and supply disruptions
in Australia and South Africa. At least two major Australian miners recently
declared <b><i>force majeure</i></b>.<o:p></o:p></span></div>
<div class="MsoNormal" style="line-height: normal; margin-bottom: 0.0001pt; text-align: justify;">
<b><span style="background: white; color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">Outlook</span></b><span style="font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">But the surge in thermal
coal prices may not last.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">First, in September,
Beijing ordered its new mines to step up production . This will increase
China’s domestic supplies by nearly 30 million tonnes a month from November.
Also, China completed the winter booking and has a 12-million-tonne stockpile
at ports that is sufficient for 20 days. Kannan expects pressure to build on
thermal coal prices from next month.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">The outlook is not so
clear for coking coal, though. Edwin Yeo, Managing Editor (Steel Raw Materials)
of <i>Platts</i>, doesn’t foresee a meltdown in the short term.<o:p></o:p></span></div>
<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman";">According to him, the
coking coal shortage is acute and some steel-makers in China have had to shut
down their blast furnaces. Steel-makers avoid this as re-igniting furnaces is a
costly exercise.<o:p></o:p></span></div>
<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "Arial",sans-serif; font-size: 13.0pt; line-height: 107%; mso-ansi-language: EN-US; mso-bidi-language: HI; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US;">Yeo doesn’t agree. but some
sources see a shadow of cartelisation in coking coal price surge, as three top
producers control more than half the global trade</span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-20128090059274774412016-09-26T16:09:00.002+05:302016-09-26T16:09:19.817+05:30LIC-sponsored fund seeks relaxed norms<div dir="ltr" style="text-align: left;" trbidi="on">
<h3 style="margin-bottom: 15px; margin-top: 10px; padding: 0px; text-align: left;">
<span style="font-family: Arial, Helvetica, sans-serif; font-size: large;">Proposed fund aimed at improving credit ratings of infraprojects urges RBI to relax capital adequacy ratio norms</span></h3>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">The credit enhancement fund proposed in this
year’s budget to help improve the credit ratings of infrastructure projects has
sought a special dispensation from the Reserve Bank of India (RBI) to make it
more viable.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">The Life Insurance Corporation (LIC)-sponsored fund will be set up
as a non-banking finance company (NBFC), but it has sought a relaxation in
capital adequacy ratio norms to enable it to support more projects by maximum
leveraging of equity capital. LIC has asked RBI to let it maintain a capital
adequacy ratio of 8-10% against the norm of 15% for NBFCs registered as
infrastructure finance firms, said two people familiar with the development.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">As part of measures to deepen the corporate bond market, finance
minister Arun Jaitley said in this year’s budget speech that “LIC of India will
set up a dedicated fund to provide credit enhancement to infrastructure
projects. The fund will help in raising the credit rating of bonds floated by
infrastructure companies and facilitate investment from long-term investors.”<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">The government has now decided to make the holding more
broad-based. As per the new structure being worked out, while LIC will hold a
49% stake, India Infrastructure Finance Co. Ltd (IIFCL) will hold 20% and a few
public sector banks will hold the rest. The fund’s initial corpus is likely to
be Rs500 crore, allowing it to provide a guarantee to bond issuances worth
around Rs15,000 crore.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">An email sent to the RBI spokesperson and to LIC on 9 September
remained unanswered. Sanjeev Kaushik, deputy managing director of IIFCL,
confirmed that the infrastructure lender will become part of the credit
guarantee fund.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">“IIFCL already has experience in the credit enhancement space and
has been providing this for infrastructure projects. Through this fund, even
greenfield projects can be funded,” said Kaushik.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">A credit enhancement fund will improve the rating of bonds issued
by infrastructure firms and help these projects raise funds from the market
from long-term funds like pension and sovereign funds.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Alternatively, it will reduce the pressure on banks to lend to
long-term infrastructure projects.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">A 30 August Citi India research report said banks will have to
make additional provisions and risk weights for future lending to large
borrowers, pushing more firms to access the corporate bond market for
fund-raising. It estimated that bank lending to this segment could come down to
Rs10,000 crore by March 2019 from Rs25,000 crore this year.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Last month, RBI announced a number of measures to deepen the
corporate bond market. The central bank said it is considering permitting
brokers in corporate bond repos (or repurchases), authorizing them to act as
market makers and also allowing foreign investors to directly trade in
corporate bonds. RBI said it is also considering accepting corporate bonds as
collaterals at its liquidity adjustment facility operations. It also permitted
banks to provide partial credit enhancements of up to 50% of the bond issue
size, up from 20%.<o:p></o:p></span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-80867085622056364022016-09-26T16:02:00.002+05:302016-09-26T16:02:46.347+05:30The endgame for venture investing in India<div dir="ltr" style="text-align: left;" trbidi="on">
<h3>
<span style="font-family: Arial, Helvetica, sans-serif; font-size: large;">The future of India’s nascent venture capital scene hinges on the outcomes of the battles between homegrown start-ups like Flipkart and Ola and American rivals Amazon and Uber</span></h3>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">Venture capital firms and other investors have
poured roughly $6.5 billion into Flipkart, Snapdeal and Ola (and their units),
since 2010, betting that they will be able to keep their American rivals Amazon
and Uber at bay.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">The investors reckoned that the headstart that online retailers
Flipkart and Snapdeal and cab aggregator Ola enjoyed, their superior local
knowledge, nimbleness, and the passion and ability of their founders would keep
them ahead of the American technology giants.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">Amazon.com Inc. and Uber Technologies Inc. were perceived to be
slower in taking decisions and hesitant in giving too much power to the
management of their local units. Unlike “pure-tech” businesses like Google Inc.
and Facebook Inc., which are dominant in India, any operations-heavy tech
business such as e-commerce and cab hailing would favour Indian start-ups over
US firms, the investors believed.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">But the speed at which Amazon and Uber have expanded over the past
18 months or so has shocked venture capitalists (VCs), putting their investment
thesis at grave risk.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">The transformation has been so sudden that Snapdeal, whose CEO
Kunal Bahl predicted in August 2015 that it would become the largest online
marketplace in the country, is now already considered an also-ran in the market
share battle.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">Consequently, the future of the country’s nascent venture capital
scene, in its current form, hinges on the outcomes of the market share battles
between Flipkart and Amazon and Ola and Uber, according to VCs and
entrepreneurs.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">Flipkart and Ola didn’t respond to emails seeking comment.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">If Flipkart and Ola list their shares or sell out at attractive
prices, it will usher in a golden period for VCs; if, however, either one or
both of them fail to generate investment returns, some VCs may have to shut
shop and investor sentiment towards Indian start-ups will take a serious hit.<o:p></o:p></span></div>
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<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">Big names, Big money</span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">The numbers are staggering: Together, Flipkart (valued at $15
billion) and Ola (valued at $5 billion) along with online marketplace Snapdeal
(valued at $6.5 billion) accounted for a mammoth 55% of the cash raised by all
Indian start-ups in the go-go years of 2014 and 2015. Their combined valuations
constitute 65-70% of the valuations of all Indian Internet start-ups, according
to<span class="apple-converted-space"> </span><i>Mint</i><span class="apple-converted-space"> </span>research.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">These three firms are backed by practically all the best-known
venture capital firms operating in India: Accel Partners, Kalaari Capital,
Sequoia Capital, Matrix Partners and Nexus Venture Partners.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Apart from traditional VCs, three of the most influential
bulge-bracket start-up investors in India, Tiger Global Management, SoftBank
Group and DST Global, have poured huge amounts of money into Flipkart, Snapdeal
and Ola.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">Flipkart, Snapdeal and Ola are at the top of the list of the
handful of Indian start-ups that have gone through all the stages of the
venture capital investing model: angel investors fund a potentially great but
nascent idea, VCs provide early capital to convert the idea into a mid-size
start-up, then growth-stage investors pump in large amounts of capital to try
and turn the start-up into an established company.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">“There’s a lot riding on Flipkart and Ola,” said Sharad Sharma, an
angel investor and co-founder of iSPIRT, a software products think tank. “If
these two companies can deliver returns above the watermark, then we will have
a soft landing for B2C (business to consumer) sector. If, however, in the worst-case
scenario, they don’t deliver basic returns, the investor sentiment towards
Indian consumer start-ups will turn bad.”<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">Until the 2015 surge of Amazon and Uber, investors believed all
the three firms were on track to listing their shares in the near future and
deliver the hard-earned blockbuster returns they craved for.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">SoftBank, Kalaari, Nexus and Tiger Global declined to comment.
Accel and Sequoia didn’t respond to emails seeking comment.<o:p></o:p></span></div>
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<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">Lure of big exits</span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">VCs have been investing in India for a decade or so, but they have
struggled to deliver good returns to their backers, called limited partners
(LPs). Typically, a venture fund is said to have performed well if it returns
four or five times the capital invested. For this to happen, the fund needs to
make one or two investments that will deliver an exit of 10-50 times the
capital invested.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">For VCs in India, Flipkart, Snapdeal and Ola are those bets, along
with a handful of others such as payments and e-commerce firm Paytm, online
marketplace ShopClues and enterprise software provider Freshdesk.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Many VCs including Accel Partners, Kalaari Capital and Nexus
Venture Partners have raised new funds over the past 18 months, partly on the
back of selling some of their shares in Flipkart and Snapdeal at attractive
prices.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">In general, most VCs even in the US fail to return the funds
invested to their LPs, studies have shown. Since 1997, venture capital firms in
the US have returned less cash to LPs than the invested amount, according to a
2012 report by the Ewing Marion Kauffman Foundation, a think tank. What
keeps LPs coming back, however, is the lure of big exits such as those of
Facebook, LinkedIn Corp. and Twitter Inc. in recent years and those of Intel
Corp., Apple Inc., Microsoft Corp. and hundreds of others in the early years of
Silicon Valley.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">Indian VCs haven’t seen any such blockbuster exits, which is why
Flipkart, Snapdeal and Ola are so important.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">And it’s not just that Flipkart, Snapdeal and Ola have raised
disproportionately large amounts of cash. Their founder duos—Sachin Bansal and
Binny Bansal (Flipkart), Kunal Bahl and Rohit Bansal (Snapdeal) and Bhavish
Aggarwal and Ankit Bhati (Ola)—are considered to be the best entrepreneurs in
the country and role models for start-up founders.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">“The likely scenario is that Flipkart will exit through a big IPO
(initial public offering); then, the funding market will go through the roof,”
said Abhishek Goyal, co-founder of Tracxn, a start-up tracker. “In the
worst-case scenario, if Flipkart’s valuation dips to $5 billion or below,
opportunist investors will flee India for the short term and a few venture
capital firms may close down. But there’s so much interest in the India growth
story that it will continue to be one of the most attractive start-up markets.”<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">IPO or sale?</span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">The endgame for Flipkart, Ola and Snapdeal is far from clear.
Though analysts say Amazon and Uber currently are favourites to emerge winners
because of easy access to large amounts of capital, Flipkart and Ola have
formidable strengths while Snapdeal has changed its strategy to focus on
cutting costs and growing net revenue rather than boosting gross sales through
deep discounts and extensive advertising.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">“We have a clear strategy to build a long-term oriented,
profitable e-commerce business and have been making tremendous progress in that
direction over the last year. The decision to go for an IPO rests with the
board of the company and they will take it up when appropriate,” a Snapdeal
spokesperson said in an email response.<span class="apple-converted-space"> </span>“We
have witnessed a clear shift in investors focusing on revenue market share and
growth vs GMV (gross merchandise value) market share over the last few
quarters. Hence, we are witnessing significant inbound interest from investors
who believe this is the right strategy for Indian e-commerce going forward.
That said, we are currently well-capitalized and have no immediate needs to
raise a round.”<o:p></o:p></span></div>
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<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">Also read |</span></b><span class="apple-converted-space"><span style="font-family: Arial, sans-serif; font-size: 13pt;"> </span></span><b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><a href="http://www.livemint.com/Companies/8IZ3R6RN8Rk2qNXReR0fUN/Startups-that-are-clear-market-leaders-will-gear-for-IPOs.html" target="_blank"><span style="color: #0c3451;">Start-ups that are clear market
leaders will gear for IPOs: Tracxn</span></a></span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Flipkart is still India’s largest e-commerce firm, has a
near-monopoly in online fashion (a key category) and a large- enough cash war
chest to keep up with Amazon’s spending power, at least over the near term.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Ola is a clear market leader and it has shown it can hold its own
against Uber. <o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Even if Amazon and Uber were to overtake Flipkart and Ola at some
point, as long as the Indian firms remain within touching distance of their US
rivals, the chances of successful exits are high.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">“I am certain that Ola and Flipkart will certainly be among the
largest Indian Internet companies a number of years down the road,” said Avnish
Bajaj, managing director at Matrix Partners India, one of Ola’s largest
investors. “The likes of Bhavish (Aggarwal) and Sachin (Bansal) have the
ability, the staying power, personal will and the financial backing to carry
their companies to an eventual IPO, and not be forced to sell. They will
inspire future Indian entrepreneurs.”<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">And if there are IPOs, India’s start-ups would’ve achieved their
holy grail, he said.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">“The biggest challenge will be for the first one to get to an IPO.
Once that happens, the floodgates will open for others. But I expect an Indian
start-up to do an IPO within two-three years,” added Bajaj.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Others believe some sort of consolidation among Indian e-commerce
start-ups is inevitable. China’s Alibaba Group, which is already an investor in
Snapdeal and Paytm, is believed to be one of the only suitors which can drive
consolidation. In case of such consolidation, it’s difficult to predict what
will be the financial outcome for investors.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">Copycat investing</span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">This year, investors have already started diversifying away from
consumer Internet investments. Apart from taking more time to strike deals,
investors have also turned more demanding.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Last year start-ups in hyperlocal groceries, food delivery and
hyperlocal services attracted large amounts of capital partly on the basis that
they were replicating similar business models from the US or China. That has changed
to a large extent so far this year.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">In the first half of the year, start-ups in enterprise software,
financial and automobile technology, and online pharmacy were popular with
investors, according to data from Tracxn.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">To be sure, investors and entrepreneurs will always keep an eye on
the US and China for start-up ideas. Some of the investments in fintech, for
instance, are inspired by start-ups that have come up in the US and China.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">But what may change is that start-ups and investors will have to
be smarter in adopting these ideas in India and even come up with ones designed
specifically for the Indian market.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">“Investors will focus more on the uniqueness in operating models
and not just on how these models have worked in other markets across the globe,”
said Deepak Gaur, managing director at SAIF Partners, a venture capital firm.
“We too have started to look for business ideas that are not easily replicable
and are trying to solve problems unique only to India. Even entrepreneurs will
witness this change and you would see less of business ideas that are me-too of
US or Chinese companies.”<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">In consumer Internet, investors are looking for sustainable
business models beyond pure-play marketplaces and niche verticals, said Sanjay
Nath, managing director at early-stage fund Blume Ventures. “Redbus and
Freecharge have shown India-specific models can create differentiated value vs
simply replicating Chinese and Valley unicorn models. The best founders are
building a strong technology and operations moat rather than just a capital
moat. Another interesting area is enterprise-for-global markets or SaaS
(software as a service). Here, start-ups can yield higher margins and gain
global customers while leveraging India’s cost advantages,” he said.<o:p></o:p></span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-36469014085430854702016-09-26T15:50:00.001+05:302016-09-26T15:50:47.567+05:30Banks are looking to raise their game using technology<div dir="ltr" style="text-align: left;" trbidi="on">
<h3 style="margin: 7.5pt 0in 11.25pt; text-align: left;">
<span style="font-family: Arial, Helvetica, sans-serif; font-size: large;">As fintech disrupts the banking industry, Indian lenders have been
quick to embrace new ideas</span></h3>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhV6ijRimz8XmpYrG2Z2tAhr9S0isyUkERnk-KkNAbyl_Tc0O6NJ6ylZ1ShOqEyURn2HOYY-LbPUvvMxXAGONFAGCAzY5Zidhof3kbNoywJxMftTuF0-U4F5bIByIhDEGss9ublUQoeNevu/s1600/article-0-1DE5FD0800000578-942_634x362.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="364" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhV6ijRimz8XmpYrG2Z2tAhr9S0isyUkERnk-KkNAbyl_Tc0O6NJ6ylZ1ShOqEyURn2HOYY-LbPUvvMxXAGONFAGCAzY5Zidhof3kbNoywJxMftTuF0-U4F5bIByIhDEGss9ublUQoeNevu/s640/article-0-1DE5FD0800000578-942_634x362.jpg" width="640" /></a></div>
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<span style="font-family: Arial, sans-serif; font-size: 13pt;">In July, the Reserve Bank of India (RBI) set up
an inter-regulatory working group to study issues relating to financial
technology (fintech) and digital banking in the country. The aim is to
understand major fintech innovations and developments and how the markets—the
financial sector in particular—are adopting new delivery channels, products and
technologies.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">The initiative comes in the backdrop of various Indian banks
testing out newer technologies in both the corporate and retail banking space,
either independently or with the help of fintech companies.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Here are five major technologies that banks have either launched,
or in various testing stages, and are likely to disrupt how banking is done:<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">Blockchain technology</span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Blockchain is a digital ledger software code. Essentially, it’s a
record keeping technology, but the difference is that the recording happens on
consensus, which is built into the system itself. Since blockchain is a
decentralised ledger, all system members can access stored information. Though
the blockchain technology emerged from cryptocurrency, Bitcoin, it is not
restricted to bitcoins or even to the financial sector. Consulting firm PwC
estimates that around 700 companies are exploring the use of blockchain, of
which 150 are in the fintech space and 25 likely to emerge as leaders.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Globally, banks such as UBS AG, ABN AMRO Bank NV and Deutsche Bank
AG are trying to find ways to use blockchain technology in daily banking. In
India, Axis Bank Ltd, ICICI Bank Ltd and Kotak Mahindra Bank Ltd are also
looking at blockchain technology. Banks see a possibility to use blockchain
technology in trade finance and remittance space.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">“We see a possibility to use blockchain for cross-border
remittance and funds transfer in banking. We are right now in the testing
phase,” said Deepak Sharma, chief digital officer, Kotak Mahindra Bank.
However, blockchain-based applications can’t work in isolation and require a
network to come together.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">Artificial intelligence</span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">In the artificial intelligence (AI) space, chatbots seem to have
more takers when it comes to banking. Chatbots are computer programs that can
imitate conversation with people using artificial intelligence. “A few examples
where artificial intelligence can be used are for authentication, access,
security, interpersonal recognition, virtual personal teller assistants and
smart advisors,” said Rajiv Anand, executive director, Axis Bank. For instance,
questions like ‘How much balance is there in my account?’, ‘How to load money
from a wallet?’ or ‘How to change my address?’ can be answered with the help of
a chatbot. Banks such as HDFC Bank Ltd and Kotak Mahindra Bank are looking to
introduce chatbot-based technology into customer service. In April this year,
DBS Bank Ltd launched a banking app in India with in-built artificial
intelligence. Currently, fintech companies such as niki.ai are also developing
AI-based chatbot apps and working as an enabler for the banks.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">Biometrics</span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Financial institutions are considered one of the most vulnerable
to cyber-attacks, especially with increasing digitisation. Since securing an
account with a powerful authentication tool is one of the important steps,
banks globally are working on technologies capable of using a customer’s unique
characteristics for identity authentication. Banks and financial institutions
across the globe are experimenting with biometrics for security and
authentication purposes. For instance, vein authentication in Japan and
monitoring of heartbeats in Canada has been tested for identification purposes
to allow banking transactions.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Currently, some Indian banks are using fingerprint recognition,
voice recognition and iris recognition for identification purposes. Large
commercial banks such as ICICI Bank, HDFC Bank and Kotak Mahindra Bank are
right now in the testing phase. Smaller banks such as DCB Bank Ltd have already
launched fingerprint-based ATM cash withdrawal using the Aadhaar enabled
platform.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">Open API</span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Open application programming interfaces (APIs), too, are gaining
traction in banking. Open API basically allows data to be accessible for use to
larger institutions. The government has mandated an open API policy for five
programmes: Aadhaar, e-KYC, e-Sign, proposed privacy-protected data sharing and
the Unified Payments Interface (UPI). Many commercial banks are in various
stages of using Aadhaar and e-KYC and offering products linked to it to their
customers. For instance, Aadhaar-enabled biometric authentication is being used
to open bank accounts.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">UPI, the most ambitious project of the National Payments Corp. of
India (NPCI), is now available for transaction. Since the system uses a single
identifier, it eliminates the need to exchange sensitive information such as
bank account numbers during a financial transaction. The objective of a unified
system is to offer architecture and a set of standard APIs to facilitate the
next generation online immediate payments.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<b><span style="font-family: Arial, sans-serif; font-size: 13pt;">Payments</span></b><span style="font-family: Arial, sans-serif; font-size: 13pt;"><o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">In the last couple of years, the payments and transaction space
has been changing with banks and e-wallet companies focusing on newer
technologies. Banks are increasingly adopting technologies that can make
transactions easier. Some of the major payment options that banks are betting
on include virtual cards, sound waves, quick response (QR) codes and near field
communication (NFC).<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Virtual cards are cards that are saved in your mobile phone—you
don’t need to carry a physical card. Axis Bank is looking to roll out these
products soon. Banks are also testing the technology of using sound waves from
the phone. To complete a transaction, the sound wave generates digital
information, which is carried to another phone. It is similar to sending a
picture or video using Bluetooth, except that you can’t make a monetary
transaction. NFC-enabled cards allow you to transact without having to insert
or swipe a card. You just have to wave your card near the terminal and the
payment is made. Another technology is QR code. It is a machine-readable code,
in a black and white matrix and can be read by a smartphone. Using this QR
code, you can make the payment.<o:p></o:p></span></div>
<br />
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">All these technologies are still work in progress for the banking
sector. According to a June Credit Suisse report on<i>Digital banking in India</i>,
while India may follow other developed markets in terms of impact from digital
payments, there are many outcomes which could be unique to India, such as cost
of transactions coming down to zero. The best customer interfaces (read apps)
could own the customer.<o:p></o:p></span></div>
</div>
Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-74301823443834024632016-09-26T15:28:00.000+05:302016-09-26T15:28:23.084+05:30The mechanics of monetary policy committees<div dir="ltr" style="text-align: left;" trbidi="on">
<h3 style="margin-bottom: 15px; margin-top: 10px; padding: 0px; text-align: left;">
<span style="font-family: Arial, Helvetica, sans-serif; font-size: large;">After the appointment of government nominees to the monetary policy committee (MPC), the spotlight now shifts to how exactly this panel will work</span></h3>
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjO_p715rRU8NSqbmcmLiioGOnYIDQzUf8h1s5I51mWpFkWzKkw6hBAHu6-iKJzIgKTRuaFRPCjq3OY5mevBUq42EX5cfpw0zkWsWVcD7avfqI4raK5mdioA2T92ozv4e4A0jRmRk58H_ln/s1600/URJIT_Patel_2980067f.jpg" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="478" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjO_p715rRU8NSqbmcmLiioGOnYIDQzUf8h1s5I51mWpFkWzKkw6hBAHu6-iKJzIgKTRuaFRPCjq3OY5mevBUq42EX5cfpw0zkWsWVcD7avfqI4raK5mdioA2T92ozv4e4A0jRmRk58H_ln/s640/URJIT_Patel_2980067f.jpg" width="640" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><b><span style="font-family: Arial, Helvetica, sans-serif;"><span style="font-size: 14px; text-align: start;">Urjit Patel </span><span style="font-size: 14px; text-align: start;">(RBI) governor</span></span></b></td></tr>
</tbody></table>
<div>
<span style="font-family: Arial, Helvetica, sans-serif; font-size: large;"><br /></span></div>
<div>
<div class="s3l" style="margin-bottom: 11.25pt; margin-left: 0in; margin-right: 0in; margin-top: 0in; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">With the appointment of government nominees,
the committee that will decide India’s monetary policy is in place. Now, the
spotlight shifts to how exactly this panel will work.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Pami Dua, director of the Delhi School of Economics; Chetan Ghate,
a professor at the Indian Statistical Institute, and Ravindra Dholakia, professor
of economics at the Indian Institute of Ahmedabad, join Reserve Bank of India
(RBI) governor Urjit Patel, deputy governor R. Gandhi and executive director
Michael Patra on the committee.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">While RBI has a history of working with the technical advisory
committee (TAC), the terms of engagement with the new monetary policy committee
(MPC) will be different.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">For one, unlike TAC, where the voting was anonymous, the MPC
framework requires the central bank to share the minutes of the MPC meeting, 14
days later.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">These minutes will include details of how each member voted and
also their statement justifying the reasons for voting in favour or against a
resolution. <o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;"> “It has become very onerous for external members now as
these statements will be made public,” said Indira Rajaraman, an economist and
a member of the technical advisory committee. Just like the technical advisory
committee, MPC external panellists are also part-time members, appointed for
four years. Second, this greater accountability requires MPC members to
meet regularly<o:p></o:p></span></div>
<div style="margin-bottom: 11.25pt; margin-left: 0in; margin-right: 0in; margin-top: 0in; text-align: justify;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">The amended RBI Act prescribes at least four meetings a year.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">TAC used to meet once in a quarter and for about three hours,<span class="apple-converted-space"> </span>wrote</span><span class="apple-converted-space"><span style="color: #0c3451; font-family: "Arial",sans-serif; font-size: 13.0pt;"> </span></span><span style="font-family: Arial, sans-serif; font-size: 13pt;">Ashima Goyal, economist and TAC member in a 19
September<span class="apple-converted-space"> </span><i>Mint<span class="apple-converted-space"> </span></i>op-ed.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Note that established policy boards such as the ones in Bank of
England meet at least eight times a year and members receive an extensive staff
briefing on the economy a week prior to the policy day.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Their meetings, too, go on for days, like for instance, the
two-day conferences of the US Federal Reserve Open Market Committee.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Third, sharing of information to external members will also be key
to informed decisions. One complaint among TAC members was their limited access
to information, according to a top RBI official speaking on condition of
anonymity. The amended RBI Act says MPC members can now request at any time,
“additional information, including any data, models or analysis”.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Fourth, the role of the central bank governor and her/his deputies
will also change under the new regime. In the past, the governor just had to
listen and act independently.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">A<span class="apple-converted-space"> </span><i>Mint<span class="apple-converted-space"> </span></i>story<span class="apple-converted-space"> </span>showed</span><span class="apple-converted-space"><b><u><span style="color: #0c3451; font-family: "Arial",sans-serif; font-size: 13.0pt;"> </span></u></b></span><span style="font-family: Arial, sans-serif; font-size: 13pt;">that rate
decisions under governor Raghuram Rajan’s tenure were not in accordance with
the majority TAC view most of the time. But any disagreement with MPC members
will have a larger implication for policymaking.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">A market participant said on condition of anonymity that any dissonance
in the views of MPC members and the governor could spell uncertainty and
disturb the markets.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;"> “The TAC was advice, and after that the governor and the
finance minister did as they liked. The MPC is an executive body. It makes the
decision,” said Ajay Shah, economist and researcher at the National Institute
of Public Finance and Policy.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">According to the monetary policy framework, agreed by RBI and the
government last year, the central bank will look to contain inflation within a
band of 4% plus/minus 2 percentage points. The amended RBI Act says that the
panel “shall determine the policy rate required to achieve the inflation
target”.<o:p></o:p></span></div>
<div style="margin: 0in 0in 11.25pt;">
<span style="font-family: Arial, sans-serif; font-size: 13pt;">Will the MPC start functioning before the 4 October policy review?<o:p></o:p></span></div>
<span style="font-family: Arial, sans-serif; font-size: 13pt; line-height: 107%;">We
will know by 27 September since RBI will have to publish the schedule of
meetings at least one week before the first meeting for the year.</span></div>
<div>
<span style="font-family: Arial, sans-serif; font-size: 13pt; line-height: 107%;"><br /></span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-5034803534060512842016-09-23T14:01:00.002+05:302016-09-23T14:01:57.663+05:30Technology enhances human relationships<div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div class="article-dateline" style="-webkit-text-stroke-width: 0px; background-color: white; border: 0px; clear: right; color: #3b3a39; float: left; font-family: Georgia, Times, serif; font-size: 14px; font-style: normal; font-variant-caps: normal; font-variant-ligatures: normal; font-weight: bold; letter-spacing: normal; margin: 0px; orphans: 2; outline: 0px; padding: 0px; position: relative; text-align: left; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; width: auto; word-spacing: 0px;">
<span class="upper" style="outline: 0px; text-transform: uppercase;"></span></div>
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<h3 style="margin-bottom: 20px; margin-top: 0px; outline: 0px; padding-bottom: 1em; text-align: left;">
<b><span style="font-family: Arial, Helvetica, sans-serif; font-size: large;">Highlights of the Mumbai edition of the Social Media Week</span></b></h3>
<div>
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<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;"><span id="goog_1632117197"></span><span id="goog_1632117198"></span><br /></span></div>
</div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">And, that was a wrap! Fifty-three speakers,
35 topics, and one didactic event! It’s great to be a part of such an
incredible global event, where you have all the ‘social media gurus’ under one
roof. This year’s global theme was The Invisible Hand: Hidden Forces of
Technology (and How We Can Harness it for Good), and the Social Media Week’s
events were held in the bustling city of Mumbai. What a week!<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">People always ask, what did you cover at SMW Mumbai, and I tell
them, the right question is, ‘What didn’t we cover?’ There were numerous
topics, from social media trends, ideas, content and concepts, to insights,
campaigns, tools, features, products, ROI, and so much more.<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">On the opening day, we were joined by Vivek Nayer, the CMO of
Mahindra and Mahindra, as he walked us through the ‘Power of Storytelling in the
Landscape of New Media’. Nayer explained why social media is so popular. He
says, “Social media encourages innovation and virality for a winning
combination.” But, Nayer also highlights a critical point most brands and
marketers forget. He says, if you’re looking for data there’s always plenty of
it available, but data is irrelevant if you can’t use your common sense and
judgement. And, that message was just from the opening day keynote. With that
benchmark set, the other days didn’t disappoint.<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Day two focused on ‘News, Media and Entertainment’ with three
keynotes and three panel discussions. A morning speech led by the Head of
Sports Partnerships of Twitter India, Aneesh Madani, gave us a glimpse into the
sporting world. His topic, ‘A look at how sport connects and dominates on
Twitter’ showed us how who you follow on Twitter is a direct reflection of who
you are. “We have moved into a new era where we can be anywhere, but still be a
part of the conversation,” he said.<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Day two also included a topic most people are inquisitive about
– viral videos. But, Aditya Bhat, the Content Head for Reliance Jio, approached
the topic in a different way: How not to Make a Viral Video. Bhat said there
was no hard and fast rule or recipe for success when it comes to making viral
videos.<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Bhat says that viral videos have one common element: quirkiness.
“You don’t need big budgets for a viral video. You just need an impactful
message.”<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">‘Startups and Entrepreneurship’ encompassed the third day’s
focus, along with an important focus on personal branding. Kavi Arasu, the
Executive Coach of Leadership and change for Social Business, presented
‘Personal Branding simplified in 60 minutes’. “In the era of social media,
building your own personal brand is more important than ever,” Arasu said.
While the product is important, people trust people. A little note to everyone
out there: You are your own brand!<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">A key thought that kept arising in everyone’s mind throughout
the week was, ‘Why is social media so viral?’ Angad Singh Manchanda, Co-Founder
of Chimp&z Inc, had the perfect answer: “There is one common thread among
everything that goes viral – relate-ability.” Manchanda says the only reason
people are on social media is because it’s the biggest source of entertainment
today. And, who doesn’t like to be entertained?<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">The closing day of Social Media Week featured some great
speakers, including Satya Raghavan, the Head of Entertainment of YouTube India,
who spoke on ‘Monetisation of Digital Content’. Today, a vast majority of
YouTube creators just use a phone to create their content. “A YouTube thumbnail
is like a window into a shop. It could determine whether a consumer clicks on
it,” was one insight from Raghavan.<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">To cap it all off, Atul Kasbekar, film-maker and fashion
photographer, joined us on a panel discussion with Anand Desai, Partner DSK
Legal, and Lavin Mirchandani, Founder of GetEvangelized to talk about
‘Celebrity Monetisation, Engagement and Content Ownership on Social Media’.
“Brands think getting a celebrity to advertise and promote a product will help
sell the product. That’s wrong! The product quality matters first,” says
Kasbekar. He believes there’s a whole new world of celebrity on social media.
It has created a sub-culture, just by accretion.<o:p></o:p></span></div>
<div class="body" style="font-size: 16px; margin: 0in 0in 15pt; outline: 0px; text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">The common thread that ran through the ‘Invisible Hand’ theme
was how technology is enabling relationships and relate-ability between people
and brands and people. It’s no longer about the hardware or software, we are
looking at how technology can build meaningful relationships within online
communities.<o:p></o:p></span></div>
</div>
</div>
</div>
Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-54687959394056982272016-09-23T12:16:00.000+05:302016-09-23T13:58:38.247+05:30Manufacturing slowing in September, reveals SBI Composite Index<div dir="ltr" style="text-align: left;" trbidi="on">
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<h3 style="margin-bottom: 20px; outline: 0px; padding-bottom: 1em; text-align: left;">
<span style="font-family: "arial" , "helvetica" , sans-serif; font-size: large;">Banks’ loan books not showing significant traction</span></h3>
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<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">State Bank of India on Thursday said its
yearly Composite Index, which is a leading indicator of manufacturing activity
in the Indian economy, for September 2016, is indicating a downward momentum
and is in a ‘low growth’ phase compared to the previous month’s ‘moderate
growth’ phase.<o:p></o:p></span></div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Specifically, the yearly Composite Index reading for the
reporting month has come in at 50.2 (low growth), compared to the previous
month’s 52.7 (moderate growth), and above the benchmark level of 50.<o:p></o:p></span></div>
</div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">The Composite Index has mainly two indices — SBI Monthly
Composite Index and SBI Yearly Composite Index. A consistent negative
(positive) month-on-month forecast in the index will lead to negative
(positive) growth rate in year-on-year index after a while.<o:p></o:p></span></div>
</div>
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<br />
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<b style="outline: 0px;"><span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Loan book</span></b></div>
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;"><div style="text-align: justify;">
<span style="font-size: 17.3333px;"><br /></span></div>
<span style="font-size: 13pt;"><div style="text-align: justify;">
<span style="font-size: 13pt;">According to</span><span class="apple-converted-space" style="font-size: 13pt;"><i style="outline: 0px;"> </i></span><span style="font-size: 13pt;">Ecowrap</span><i style="font-size: 13pt;">,</i><span class="apple-converted-space" style="font-size: 13pt;"> </span><span style="font-size: 13pt;">a publication of the bank’s economic
research department, the banking sector loan book is not showing significant
traction as of now, on the back of a stagnant pipeline of projects.</span></div>
</span></span></div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">“In our view, the year is likely to see 13-14 per cent credit
growth, but mostly on the back of refinancing by banks on completed
infrastructure projects in sectors such as power and roads where there are no
risks.<o:p></o:p></span></div>
</div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">“In the coming months, there may be some demand from the retail
side due to festive seasons. We also believe oil companies and NBFCs may avail
of credit growth in the second half of the current fiscal,” it said.<o:p></o:p></span></div>
</div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Referring to a rating round-up report for the second half of
FY16,<span class="apple-converted-space"> </span>Ecowrap<span class="apple-converted-space"> </span>said the debt weighted credit ratio or
the quantum of debt of firms upgraded versus downgraded was 0.2, the lowest in
the last three years. This signals the trend in credit quality of corporate
India. Sectors that stood out in the upgrade were in consumption-related
sectors such as agricultural products, textiles, and automotive components.
Poor performance by sectors in the downgrade category includes steel, electric
utility, and industrial machinery.<o:p></o:p></span></div>
</div>
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<br />
<div style="text-align: justify;">
<b style="outline: 0px;"><span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">Credit cycle to improve</span></b></div>
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;"><div style="text-align: justify;">
<span style="font-size: 17.3333px;"><br /></span></div>
<span style="font-size: 13pt;"><div style="text-align: justify;">
<span style="font-size: 13pt;">According to the report, “The credit cycle will turn for the better in a
gradual manner. The good thing is that a part of the slowdown in corporate
credit growth in the current fiscal is because of de-leveraging by corporates
and subsequent repayments.</span></div>
<o:p></o:p></span></span></div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">“Retail credit growth continues to be strong. Additionally,
about 48 per cent of the credit upgrades in H2 FY16 was due to better order
book/healthy demand, improvement in profit margins and efficient management of
working capital.”<o:p></o:p></span></div>
</div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">With the Pay Commission arrears and revised salary of government
employees implemented from August 2016, bank deposits showed sizeable growth in
September (over 20 per cent of the incremental addition in the current fiscal
is attributable to these developments. This will lead to increased consumer
demand ahead of the festive season.<o:p></o:p></span></div>
</div>
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<div style="text-align: justify;">
<span style="color: #3b3a39; font-family: "arial" , sans-serif; font-size: 13.0pt;">“We are pencilling in a 50-basis point rate cut by the RBI MPC,
maybe as early as in the October policy,” said the report.<o:p></o:p></span></div>
</div>
</div>
</div>
</div>
Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-24319675998471740552016-09-21T13:47:00.002+05:302016-09-21T13:58:45.390+05:30Indian electronics products to touch $75 bn by 2017: ASSOCHAM-EY study<div dir="ltr" style="text-align: left;" trbidi="on">
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<br />
<span style="font-family: "arial" , "helvetica" , sans-serif;"><span style="font-family: Arial, Helvetica, sans-serif; font-size: medium;">The
Indian electronic products industry in India is expected to grow at a CAGR of
10.1% to reach US$ 75 billion by 2017 from US$ 61.8 billion in 2015 with
increasing penetration across consumer products especially in semi-urban and
rural markets, along with government push for infrastructure development,
locomotive and energy, there exists a significant opportunity for rapid
expansion of this industry, adds the ASSOCHAM-EY joint study.</span></span><br />
</div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: medium;"></span><br /></span></div>
<div style="text-align: justify;">
<span style="font-family: Arial, Helvetica, sans-serif; font-size: medium;">The electronic components industry in India was valued at US$13.5 billion
in 2015, growing from US$10.8 billion in 2013 at a CAGR of 11%. The market is
dominated by electromechanical components (such as PCB and connectors) which
form 30% of the total demand, followed by passive components (such as resistors
and capacitors) at 27% , according to an ASSOCHAM-EY study titled ‘Turning the
Make in India dream into a reality for electronics and hardware industry’. </span><br />
<span style="font-family: Arial, Helvetica, sans-serif; font-size: medium;"><br /></span></div>
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<span style="font-family: Arial, Helvetica, sans-serif; font-size: medium;">
<div style="text-align: justify;">
India’s attractiveness for manufacturers is growing due to availability of
low-cost labor. Rising manufacturing costs in China and Taiwan are compelling
manufacturers to shift their manufacturing base to alternate markets. In 2014,
the average manufacturing labor cost per hour in India was US$0.92 as compared
to US$3.52 of China, noted the study.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
The Indian manufacturing ecosystem for electronics and hardware industry
is still at a nascent stage and faces various demand side as well as supply
side challenges are limited scale of operations and local component demand due
to the nascent product manufacturing in India. Component demand in India is
muted due to very limited value addition as primarily last-mile assembly takes
place. Norms such as safety regulations for automotive, medical and industrial
sectors have driven the uptake of electronic content globally.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
However, manufacturers in India do not add high electronic content in the
products due to limited industry-specific standards. The current market is
dominated by secondary sales and primary sales are limited due to reduced
disposable income in semi-urban and rural markets. The market penetration for
most of the consumer appliances and electronics is currently lagging behind
global average by up to 60% in certain categories and there lies huge untapped
potential in rural markets (approximately 69% of India’s households).<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
Although global markets are witnessing rapid consumer uptake as electronic
content increases across verticals (e.g., automotive with applications around
safety, connectivity, infotainment, consumer electronics, smart homes, etc.);
India has a slower adoption as consumers remain highly sensitive to even a
marginal increase in product prices.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
Due to nascent stage of electronics manufacturing in India, scale of
operations is low, resulting in reduced cost competitiveness. Traditional
electronics manufacturing destinations such as China, Taiwan and South Korea
have built significant capacities across manufacturing value chain (SKD
assembly, CKD assembly, Semiconductor Assembly & Testing Services). In
addition, emerging (Malaysia, Vietnam) destinations have also built capacities.
Although labor cost is low in India, labor productivity is lower than
traditional destinations.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
The basic infrastructure for any industry comprises good roads, power,
water, telecommunications, ports and logistics. In India, availability of these
facilities is not up to the mark, even in established industrial estates. While
the Government has notified Greenfield Electronic Manufacturing Clusters, they
still remain un-operational due to infrastructure issues.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
The lack of proper roads and sales infrastructure results in distribution
challenges for companies catering to markets in small semi-urban cities, rural
areas and remote villages. Additionally, from both import and export
perspective, there is port congestion due to unavailability of containers and
long documentation process.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
Availability of relevant manpower is crucial to the development of any
industry. Since the electronics manufacturing industry has high dependence on
skilled manpower, especially for highly specialized activities such as
electronics system design, IC design and manufacturing etc., the availability
of talent with relevant skill sets assumes considerable importance.</div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
Both SKD and CKD are labor intensive and require delicate handling and
process adherence during the manufacturing process. With changing technology,
the labor needs to be constantly trained. However, the current labor scenario
in India poses certain challenges.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
According to National Skill Development Corporation (NSDC), the incremental
human resource requirement in the electronics and IT hardware sector will be
8.9 million by 2022. The lack of training centers that administer courses
relevant to the job functions in electronics sector is also a concern.
Moreover, the country has strict labor laws including restrictions on overtime
work, employee headcount and work timings for women employees, which act as a
barrier for growth in the sector.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
The high cost of working capital and capex-related financing (receivables
and payables) due to high interest rates is a major challenge faced by domestic
manufacturers, since it increases the overall cost of finance. Additionally,
there is an increase in the cost of manufacturing (conversion costs) due to
inadequate availability/reliability of power, high cost of real estate, etc.
The cost of borrowed capital is 12%–14% in India as compared with ~5%–7% global
average. Moreover, with the frequently changing energy efficiency norms,
manufacturers need to make significant investments for products with a high
rating.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
India’s taxation system is complex, especially where indirect taxes are
concerned. Currently, the base direct tax incidence in India stands at around
30%, whereas the corresponding tariff in other Asian countries is between 16%
and 25%. Although, the Government has proposed the implementation of Goods and
Services Tax (GST) for a state-of the-art indirect tax system, there are
concerns that the industry faces in terms of the clarity on the revenue-neutral
rate, non-creditable tax on inter-state movement of goods, status of existing
state incentives granted and transition from existing taxation system to GST
regime.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
Procedural and regulatory clearances are time consuming and complex.
According to industry sources, it takes up to a year to set up a manufacturing
plant in the country and a new production line could take up to six months to
become fully operational.<br />
<br /></div>
<div style="text-align: justify;">
</div>
<div style="text-align: justify;">
Additionally, the refund processes and clearances to avail benefits under
tax are highly cumbersome and time-consuming. Procedure to claim concessional
duty on many raw materials/ parts/components used in manufacturing of
electronics products has been recently simplified in the Union Budget 2016-17
by introducing the concept of self-assessment.</div>
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<span style="font-family: Arial, Helvetica, sans-serif;"><span style="font-family: "arial" , "helvetica" , sans-serif; font-size: medium;"><o:p></o:p></span><br /></span></div>
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Anonymoushttp://www.blogger.com/profile/13740846457425846514noreply@blogger.com0tag:blogger.com,1999:blog-8496239013629238879.post-2080216101707937022016-09-20T11:05:00.000+05:302016-09-20T11:12:56.552+05:30MSME secretary urges small companies to focus on substituting imports<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="font-family: "arial" , sans-serif; font-size: 13.0pt; line-height: 107%;"><b>Monday delivering the inaugural address at the FICCI-MSME's
sixth annual MSME Summit on the theme 'Propelling MSME Growth: Ways &
Means', KK Jalan, the MSME secretary said:<o:p></o:p></b></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 13.0pt; line-height: 107%;">• Government was also planning to identify 25-30
sub-sectors in MSMEs and focus on these sectors for raising productivity and
enhancing the overall landscape of MSMEs.<o:p></o:p></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 13.0pt; line-height: 107%;">• He urged the MSMEs in the country to update the details
of their enterprises on the MSME data bank. He added that the updated data
would be used for evolving parameters for the growth of MSMEs in the country.<o:p></o:p></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 13.0pt; line-height: 107%;">• He said that there was a need to carry out research in
this area as it has been seen that SME credit by banks was going down. There
was a need to carry out academic work in the space to understand the challenges
and issues of the sector.<o:p></o:p></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 13.0pt; line-height: 107%;">• He suggested that for MSMEs, a dedicated financing
institute could be established like private sector NBFCs. He suggested floating
of separate NBFCs for assisting micro enterprises. _"I would shy away from
having some SIDBI-like institution or some state institution in this because
state institutions have their own problems. Therefore, let them be in the
private sector," _ he said. <o:p></o:p></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 13.0pt; line-height: 107%;">• Ancillary industries contribute about 50-60% of MSME
manufacturing and should be focused on, Jalan said. Substitution of imports can
be a major propeller of growth of SMEs, MSME secretary K K Jalan said, singling
out toys manufacturing as an example.</span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 13.0pt; line-height: 107%;"><br /></span></div>
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<span style="font-family: "arial" , sans-serif;"><span style="font-size: 17.3333px;">http://bit.ly/2d49ara</span></span></div>
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<span style="font-family: "arial" , sans-serif;"><span style="font-size: 17.3333px; line-height: 107%;"></span></span></div>
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<span style="font-family: "arial" , sans-serif;"><span style="font-size: 17.3333px;">http://bit.ly/2cPeIEU</span></span></div>
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