SECTORS ALERT (29.06.2012)
* AVIATION: The Centre is considering a proposal to provide subsidy to
private airlines operating flights on loss-making northeast India routes.
* BANKING: The RBI said tighter scrutiny is needed for risk posed by
interbank linkages.
-RBI said migration to Basel III norms might increase cost of capital.
-RBI caps merchant discount rate on debit card usage from Jul 1.
-RBI's Real Time Gross Settlement, transfer of funds, and settlement of
securities would not be available on Monday.
* CORPORATE: The government and RBI plan to create a fund to bail out
companies facing headwinds in foreign currency convertible bond redemptions.
* ECONOMY: RBI said inflation risks likely to remain high. Planning
Commission Deputy Chairman Montek Singh Ahluwalia said achieving 9% growth
in the 12th Five Year Plan is not feasible and even an 8.0-8.5% growth will
require massive reforms. Key ministries of the United Progressive Alliance
government have written to Prime Minister Manmohan Singh, demanding bold
decisions to kick-start the economy.
* INSURANCE: The Insurance Regulatory and Development Authority has slapped
a 14.7-mln-rupee fine on HDFC Life Insurance for violation norms on
commission paid to corporate agents and denial of death claims.
* MARKETS: RBI said review of Clearing Corp of India risk management
practices needed. RBI said need to watch implications of high frequency
trades.
* METALS: The Aditya Birla Group plans to shut a part of its aluminium foil
making mill in the UK and relocate the plant to its unit near Nagpur ,
Maharashtra .
* MUTUAL FUNDS: The finance ministry and the Securities and Exchange Board
of India will meet mutual fund industry officials on Monday before drawing
up a plan to give a leg up to investments in the industry.Ultra short-term
or liquid schemes of asset management companies may lose their popularity
as uncertainty in returns will rise as these funds shift to a new valuation
model.
-L&T Mutual Fund, which recently acquired the equity assets of Fidelity
Mutual Fund, has hired Soumendra Nath Lahiri as a senior fund manager.
-Finance ministry may advise SEBI to consider re-introduction of entry
load in mutual funds.
* OIL AND GAS: Public sector oil companies have cut petrol price by
2.46-3.22 rupees per litre.
* POWER: The government will form a special fiscal package for ailing
distribution companies in seven states, including Rajasthan, Andhra
Pradesh, and Tamil Nadu. Bidding rules for new domestic coal-based power
projects will depend on the source of the fuel.
* RETAIL: The Foreign Investment Promotion Board will today take a decision
on the investment proposal of clothing retailer Inditex. The government may
make an announcement on allowing 51% foreign direct investment in
multi-brand retail after the presidential election is over.
* TAXATION: The finance ministry has turned down foreign institutional
investors' demand that capital market transactions be exempted from the
proposed General Anti Avoidance Rule.
* TELECOMMUNICATIONS: The Department of Telecommunications plans to
formally slap fines totalling 15.94 lbn rupees on BHARTI AIRTEL, RELIANCE
COMMUNICATIONS, IDEA CELLULAR, Tata Teleservices, and TATA COMMUNICATIONS
for allegedly understating revenues and paying less levies.
-Vodafone, which faces a possible retrospective tax on a 2008 deal in
India , has said it has been assured of a "level playing field" by the
government.
By RUPEE DESK [email protected]
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