Daily Economic News - 14 August 2014

Government won't entertain FDI in multi-brand retail: Nirmala Sitharaman
The mandate given to the new government was on the basis of the BJP's manifesto, which clearly said "we do not entertain FDI (foreign direct investment) in multi-brand retail". BJP has criticised the UPA government-approved multibrand retail policy that allows 51 per cent foreign direct investment (FDI), but has not made any move to roll it back. Only British retailer Tesco has announced a $110-million investment in partnership with the Tata Group's Trent to open front-end stores in Maharashtra and Karnataka.
(Source: The Economic Times)

Carlsberg investing in Rs 200 crore to boost India market share:
Carlsberg is investing Rs 200 crore in India as the world's fourth-largest brewer looks to emerge a big player in the country's increasingly competitive beer market dominated by Heineken-backed United Breweries and SABMiller. its market share in India at 8 per cent is the lowest the Danish brewer has in a big market across the world. Carlsberg India, still considered a fringe player, posted net sales of Rs 394 crore with a loss of Rs 168 crore in the year ended December 2012. Numbers for 2013 are not yet available. One big reason for Carlsberg not yet generating enough funds in India is its dependence on mass brands and failure to make much ground in the premium space.
(Source: The Economic Times)

Business houses commit over $100 b investment amidst optimism:
With improvement in business sentiment following change of guard at the Centre, major Indian corporate houses, led by Tatas and Reliance, have committed to invest nearly $100 billion (Rs.6 lakh crore) in three years expressing their faith in the economy. A portion of this investment will go for their overseas operations as they have harboured global ambitions. This year, public sector undertakings (PSUs) would invest $41 billion (Rs.2.48 lakh crore) as announced in the budget 2014-15 to spur growth and create employment. Foreign investment is like to pour in. Companies like Amazon and GE have already committed billions of dollars.
(Source: The Hindu)

PM okays expenditure management panel :
The Commission will be headed by Bimal Jalan, former Governor, RBI, with Sumit Bose, former Finance Secretary and Subir Gokarn, eminent economist as members. Additional Secretary, Department of Expenditure, Ministry of Finance, will be an ex-officio member and a senior officer with finance or expenditure experience will be Member-Secretary. The detailed terms of Reference of the Expenditure Management Commission will be notified separately. The Commission is expected to submit its interim report before the Budget of 2015-16 and its final report before the Budget of 2016-17. The Commission will suggest ways to reduce food, fertiliser and oil subsidies to contain the fiscal deficit.
(Source: The Tribune)

FII inflows into debt markets exceed inflows into stocks:
Foreign institutional investors (FIIs) have poured a record amount of money into the Indian debt market with year-to-date inflows of $13.7 billion, higher than inflows of around $12.04 billion into the equity market. There is a lot of demand for Indian bonds from foreign investors because yields are quite attractive for carry trade and the rupee has also been stable. Indian bond yields have remained elevated at around 8.8% for the 10-year government 2023 bond, and prices have declined since the beginning of the year. The yields on Indian government paper are more attractive than the yields on the 10-year US treasury bonds at around 2.5%, even after factoring in a possible depreciation of the rupee.
(Source: Livemint)

Adani Power buys Lanco Infratech’s Udupi power plant:
Adani Power Ltd, controlled by billionaire entrepreneur Gautam Adani, has acquired Lanco Infratech Ltd’s 1,200 megawatt (MW) Udupi power plant in Karnataka in a Rs.6,000 crore deal that will offer the latter cash in hand and help it reduce debt. It’s the second major deal clinched in less than four months by the Adani group, whose founder is considered to be close to Prime Minister Narendra Modi. On 26 May, coincidentally the day the Modi government was sworn in, Adani Ports and Special Economic Zone Ltd bought Dhamra Port Co. Ltd from Larsen and Toubro Ltd and Tata Steel Ltd for Rs.5,500 crore after nearly a year of negotiations.
The deal confirms a revival of interest in the Indian power sector, which has in recent years been beset by slowing economic growth, high borrowing costs, delays in securing environmental clearances and completing land acquisition as well as shortages of fuel like coal and gas.
Lanco reported a loss of Rs.370.70 crore in financial year 2014 on a turnover of Rs.10,875.30 crore. It had a net debt of Rs.36,022 crore at the end of 31 March.
(Source: Livemint)

Thaiindianet.Team

14 August 2014