ISSUE: 333 2023 27 Sep 2023

Centre sticks to market borrowing plan

for H2FY24; introduces 50-year bond:
The central government has decided to stick to
its market borrowing plan of Rs 6.55 trillion in
the second half (October-March) of financial
year 2023-24 (H2FY24), brushing aside
pressure from tepid revenue growth and rising
subsidy burden in the pre-election year. This will include the issuance of
sovereign green bonds worth Rs 20,000 crore, as against the Rs 16,000
crore maiden green bonds issued in FY23. Out of the gross market
borrowing of Rs 15.43 trillion projected for FY24, the Centre borrowed Rs
8.88 trillion (57.55 per cent) in the first half (April-September). The
remaining Rs 6.55 trillion, earmarked for the second half, amounts to
42.45 per cent of the total borrowing and will be completed through 20
weekly auctions. “Responding to market demand for longer-duration
securities, 50-year security will be issued for the first time,” the finance
ministry said in a statement on Tuesday.
(Business Standard)
Govt extends export benefits under RoDTEP scheme till June
2024: The Scheme for Remission of Duties and Taxes on Exported
Products (RoDTEP) support has been extended till June 20, 2024 from
earlier September 30, 2023 deadline, at the same rates to the existing
export items, a statement issued by the Commerce Ministry on
September 26 said. In December 2022, the government had extended the
benefits under the scheme to chemicals, pharmaceuticals and products of
iron and steel till September 30 this year.
(Moneycontrol)
Afghanistan currency emerges as best-performing unit globally
in September quarter: Afghanistan‟s currency has emerged as the
world‟s best-performing unit in the September quarter, rallying 9 per cent
during the three-month period and 14 per cent so far this year amid
foreign aid flows and the US releasing funds to the war-torn country. At
Tuesday‟s exchange rate, an Afghan Afghani is worth Rs 1.06 and 78.54
against the US dollar. The mostly agrarian economy of the now Taliban-
ruled Afghanistan had tanked almost 30 per cent, and its currency had
dropped to 124.2 against the US dollar on August 16, 2021. On August 14,
the local currency quoted 80.96 against the greenback, according to a
currency analyst at HDFC Securities told PTI.
(Moneycontrol)
India’s export ban on non-basmati rice questioned at WTO:
WTO members, including the US, Canada, Australia and Japan, have
questioned the prohibition on export of non-basmati white rice,
announced in July 2023 by India, and sought clarity on the quantity it
considers adequate for domestic needs. India has also been asked to
clarify the intended duration of its export ban on wheat and broken rice
imposed last year and clarify the procedures put in place to abide by the
rule that such restrictions are temporarily applied.
(Business Line)

Extended trading hours: Pain for

traditional brokers, gain for digital
brokers?: The National Stock Exchange of India‟s
plan to add a trading session for index options and
futures from 6 pm to 9 pm has placed brokers at
the crossroads of incremental revenue and rising
costs. For the proposed session that will start two
and a half hours after the regular 9:15 am to 3:30 pm session ends, most
broking firms will have to hire additional employees, resulting in a bump
up in headcount and salaries. “We will have to add 20-30 more people at
our centralised desk to take care of evening operations,” said Dhiraj Relli,
managing director of HDFC Securities.Even small brokers will need
enough resources to help with account opening and on the tech and
customer support side to address client issues. The additional headcount
will be over and above the team for live commodity trading on the MCX
till 11:30 pm.
(Moneycontrol)
HDFC Bank let go ₹1-lakh crore lending due to competitive
pricing: HDFC Bank had to let go of a lending opportunity worth Rs ₹1
lakh crore in the wholesale business, of which ₹30,000 crore was
foregone in Q1 FY24, due to unattractive pricing on the back of
intensifying competition including from PSU banks. On a whole, HDFC
Bank expects loan growth to remain healthy with the aim of doubling the
balance sheet in four years, it said in a meeting of the top management
with Motilal Oswal Securities.
(Business Line)
Banking & financial companies go all out to retain staff: High
attrition and increased competition for hiring talent are prompting
companies in India's banking, financial services and insurance (BFSI)
sector to line up a host of incentives, promotions and career progression
plans to retain manpower, the frequent loss of which is posing a major
challenge, said industry executives.
(Economic Times)
Cosmos Co-operative Bank concludes 18 mergers: Pune-based
Cosmos Co-operative amalgamated with itself Sahebrao Deshmukh Co-
operative Bank with ten branches in Mumbai and one in Satara post the
Reserve Bank approving the voluntary merger between the two co-
operative banks. The merger comes into effect from September 26.
Cosmos bank will have a balance sheet size of around Rs 32,000 crore
post the merger with the recent amalgamation adding Rs 200 crore to its
balance sheet strength.
(Economic Times)
Cipla launches drone delivery of
critical medicines in HP: Drugmaker
Cipla has launched drone-based deliveries of
its critical medicines for hospitals in
Himachal Pradesh, in partnership with Skye
Air Mobility. The medicines included
cardiac, respiratory, and other essential
chronic therapies, Cipla said. The use of
drones will support on-time delivery of the company‟s medicines to
chemists and clinics in remote areas, while minimising risks including
temperature-linked issues affecting cold chain products, it explained.
Cipla is a forerunner among large Indian pharma companies to adopt
drone-based deliveries to facilitate supply to stockists in remote areas, the
company said. Further, the company aims to extend this service to
inaccessible and hilly terrains such as Uttarakhand and the Northeastern
regions of the country, it added.
(Business Line)
FSSAI introduces 'Special Category' provision to promote
gender equality in food biz: The Food Safety and Standards Authority
of India (FSSAI) has introduced a new provision of „Special Category‟ in
the online Food Safety Compliance System (FoSCoS) portal. The newly
launched provision aims at promoting gender equality and equal
opportunities for women and transgender entrepreneurs in the food
business sector. "Under this provision, licensing and registering
authorities will process 'Special Category' applications in a balanced
manner to maintain one-to-one ratio alongside regular applications, until
there are no pending application in either category," the authority said in
a statement. The identification of these individuals will be done during
the application submission process through Aadhaar/PAN authentica .
(Economic Times)
SEBI extends deadline for demat account
holders to provide account nominees,
submit PAN, KYC details: Market regulator
SEBI extended the deadline for Demat account
holders to provide a nomination. SEBI also
extended the deadline for physical security holders
to submit PAN, nomination and KYC details. The
deadline has been extended to December 31, 2023 from September 30.
The market regulator through a circular on March 27, 2023 had
mandated demat account holders to either provide a „choice of
nomination‟ or opt of out of nomination altogether. It had issued similar
instructions to physical security holders in listed companies to furnish
their PAN, nomination, contact details, bank account details and
specimen signature for their corresponding folio numbers through a
circular on March 16, 2023. “Submission of „choice of nomination‟ for
trading accounts has been made voluntary as a step towards ease of doing
business”, (Moneycontrol)
Angel tax norms: Govt extends safe harbour to convertible
preference shares: The Centre has extended the 10 per cent safe
harbour, previously proposed for equity shares, to include convertible
preference shares. This is among the key moves in the final valuation
rules for funding in unlisted startups for both foreign and domestic
investors under the new “angel tax” introduced in the Finance Act, 2023.
The final valuation norms, effective from September 25, are expected to
offer much-needed relief to startup funding, particularly as a considerable
number of transactions occur through the route of convertible shares.
This implies that startups can now secure funds through both equity and
compulsorily convertible preference shares (CCPS) up to a certain limit —
10 per cent of the fair market value of their shares. These investments will
not be subject to angel tax, provided they meet the criteria specified in the
safe-harbour provision.
(Business Standard)
MCA extends virtual AGM and EGM facility until September
2024: In a major relief for India Inc, the Ministry of Corporate Affairs
(MCA) has now allowed companies —whose annual general meetings
(AGMs) are due in the year 2023 and 2024 —to hold them through video
conference (VC) mode till September 30, 2024. In a separate move, the
MCA has also allowed companies to hold their extraordinary general
meetings (EGMs) via video conference and transact items through postal
ballot till end September 2024. “In continuation to this ministry‟s general
circular dated May 5 , 2020, general circular dated May 5, 2022, general
circular dated December 28, 2022, it has been decided to allow the
companies whose AGMs are due in the year 2023 or 2024, to conduct
their AGMs through VC or OAVM on or before September 30, 2024,” the
MCA said in a circular on Monday.The video conferencing system
leverages the strengths of digital India by using a combination of VC and
e-voting/simplified voting through registered emails to enable companies
to conduct their EGMs.
(Business Line)

RBI KEY RATES FOREX EQUITY

(RBI REF. ) /COMM. MARKET
Repo Rate: 6.50% INR / 1 USD : 83.2328 Sensex: 65945.47 (-78.22)
SDF: 6.25% INR / 1 GBP : 101.3909 NIFTY: 19664.70 (-9.80)
MSF /Bank Rate: 6.75% INR / 1 EUR : 88.0581 Bnk NIFTY: 44624.20 (-141.90)
CRR: 4.50% INR /100 JPY: 55.8100 Gold: 58,494.00 (-207.00)
SLR: 18.00% Silver: 71,703.00 (-447.00)
FINANCIAL CONCEPTS
CLAWBACK
 Clawback is a provision under which money that‟s
already been paid out must be returned to the
employer or the firm. This is a special contractual
clause, used mostly in financial firms, for money
paid for services to be returned under special
circumstances or events as stated in the contract.
Clawbacks involve a penalty, making them different
from simple repayments or refunds.
 The primary aim of such a provision is to prevent managers from using
incorrect accounting information. According to research, after the
provision of clawback is included, investors develop more confidence in a
firm‟s financial statements.

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