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Saturday, August 13, 2022

The Expresso Business Update

Your Business Expresso is served! The Indian Express brings to you the latest updates from the world of Indian and international business. Your one stop shop for all finance and business stories.

Episode 459 June 28, 2022

Business News at 9:30 am on 28th June 2022

“You are listening to the Expresso Business Update. Here is the latest news from the world of Indian and International business brought to you by The Indian Express and The Financial Express.

We begin the bulletin with a good news for India’s banking sector. Bankers in India recorded their best-ever quarter for mergers and acquisitions while dealmaking elsewhere slows to a crawl, a Bloomberg report says. India saw $82.3 billion pending and completed M&A deals in the second quarter, the highest amount on record, according to data compiled by Bloomberg. That’s more than twice as much than the previous record of $38.1 billion in the third quarter of 2019. Globally, M&A volume in the quarter reached $827.6 billion, down 8.7% from the same period in 2021. The surge in India was dominated by HDFC Bank’s $60 billion all-stock purchase of Housing Development Finance Corp in April, combining India’s most valuable bank and largest mortgage lender in the country’s biggest ever M&A transaction. The move illustrated how India’s flagship companies, facing disruptive trends such as the rise of fintech and climate change, are turning to dealmaking as a tactic to dramatically reshape themselves. The combination of Mindtree and L&T Infotech, two software firms controlled by engineering conglomerate Larsen & Toubro, in a $3.3 billion all-stock deal announced in May further illustrated how India’s largest firms are positioning themselves for a changed landscape.
Moving on to the all-important GST meet that begins today. The Goods and Services Tax Council, in its two-day meeting starting today, will consider rate hikes for a slew of items and steps to check evasion like biometric authentication of ‘high-risk taxpayers’, sources said. Levying taxes on hotel rooms costing below Rs 1,000 per day and bringing ‘unbranded’ pre-packaged and labelled food items under the tax net will also be considered. An interim report of a group of ministers on rate rationalisation had suggested correcting residual cases of inverted duty structures and removing some items from the exempted list. These proposals will be taken up. Besides, the Council will consider a report of the panel of state ministers headed by Kerala finance minister KN Balagopal on making e-way bill mandatory for intra-state movement of gold above a threshold of Rs 2 lakh. But a likely stand-off between the Centre and some states over the termination of the revenue compensation for states could muddy the agenda, the sources indicated. A major rejig of the GST rate structure is unlikely in the 47th meeting of the Council, which coincides with GST completing five years.
In other news, the National Anti-Profiteering Authority has asked personal care major L’Oreal to pay Rs 186 crore along with 18% interest to the Consumer Welfare Fund for not passing on GST rate cut benefits to consumers. In a 131-page order, the NAA said that commensurate reduction in the prices of goods has not been effected by the company after the GST rates were reduced. In its order dated June 23, the authority also directed the directorate-general, anti-profiteering, to initiate further investigations to find out whether L’Oreal passed on the tax reduction benefits in the period after December 31, 2018.
Meanwhile, Tencent-backed Udaan has laid off 180 employees in a move to “reinvent its business model and keep up with changing market conditions”, a source told FE. The business-to-business trade platform sacked staff across teams such as sales and on-field executives. It, however, said it was extending medical insurance and other benefits to the employees impacted. The IPO-hopeful startup’s decision to sack employees comes despite CEO Vaibhav Gupta saying Udaan’s cash burn had come down by around 40% in the first half of 2022, in an email sent to employees earlier this month.
Now an update on the fuel economy. The financial performance of India’s state-owned refining and marketing companies will remain weak as long as their net realised prices for petrol and diesel are lower than international market prices, Moody’s Investor Services said on Monday. “Nonetheless, we do not expect this situation to be sustained. We expect that the Indian government will eventually allow fuel retailers to adjust selling prices, but the price increases will be implemented gradually,” it said. Lending support to the government’s effort to contain inflation, PSUs like Indian Oil Corporation, Hindustan Petroleum and Bharat Petroleum have kept retail fuel prices on hold since May 22.
Moving on to the latest market news. Asian shares edge down in early trade on Tuesday with investors taking their cue from a volatile Wall Street session overnight, while oil prices climbed following last week’s rout. Oil continued to rise with investors still weighing worries over an economic slowdown against concern over lost Russian supply amid sanctions related to the conflict in Ukraine. For Indian indices, the pre-market cues look very muted as the SGX Nifty was trading lower suggesting a weak beginning for both BSE and NSE today. GMR Infra and Brigade Enterprises are the major stocks in focus today.

You were listening to the Expresso Business Update by The Indian Express and The Financial Express. Ask your digital assistant device to play the latest business news from the Indian Express and stay up to date with the happenings in the finance and business stories.

Business News at 9:30 am on 28th June 2022"You are listening to the Expresso Business Update. Here is the latest news from the world of Indian and International business brought to you by The Indian Express and The Financial Express. " We begin the bulletin with a good news for India's banking sector. Bankers in India recorded their best-ever quarter for mergers and acquisitions while dealmaking elsewhere slows to a crawl, a Bloomberg report says. India saw $82.3 billion pending and completed M&A deals in the second quarter, the highest amount on record, according to data compiled by Bloomberg. That’s more than twice as much than the previous record of $38.1 billion in the third quarter of 2019. Globally, M&A volume in the quarter reached $827.6 billion, down 8.7% from the same period in 2021. The surge in India was dominated by HDFC Bank’s $60 billion all-stock purchase of Housing Development Finance Corp in April, combining India’s most valuable bank and largest mortgage lender in the country’s biggest ever M&A transaction. The move illustrated how India’s flagship companies, facing disruptive trends such as the rise of fintech and climate change, are turning to dealmaking as a tactic to dramatically reshape themselves. The combination of Mindtree and L&T Infotech, two software firms controlled by engineering conglomerate Larsen & Toubro, in a $3.3 billion all-stock deal announced in May further illustrated how India’s largest firms are positioning themselves for a changed landscape. Moving on to the all-important GST meet that begins today. The Goods and Services Tax Council, in its two-day meeting starting today, will consider rate hikes for a slew of items and steps to check evasion like biometric authentication of ‘high-risk taxpayers’, sources said. Levying taxes on hotel rooms costing below Rs 1,000 per day and bringing ‘unbranded’ pre-packaged and labelled food items under the tax net will also be considered. An interim report of a group of ministers on rate rationalisation had suggested correcting residual cases of inverted duty structures and removing some items from the exempted list. These proposals will be taken up. Besides, the Council will consider a report of the panel of state ministers headed by Kerala finance minister KN Balagopal on making e-way bill mandatory for intra-state movement of gold above a threshold of Rs 2 lakh. But a likely stand-off between the Centre and some states over the termination of the revenue compensation for states could muddy the agenda, the sources indicated. A major rejig of the GST rate structure is unlikely in the 47th meeting of the Council, which coincides with GST completing five years. In other news, the National Anti-Profiteering Authority has asked personal care major L’Oreal to pay Rs 186 crore along with 18% interest to the Consumer Welfare Fund for not passing on GST rate cut benefits to consumers. In a 131-page order, the NAA said that commensurate reduction in the prices of goods has not been effected by the company after the GST rates were reduced. In its order dated June 23, the authority also directed the directorate-general, anti-profiteering, to initiate further investigations to find out whether L’Oreal passed on the tax reduction benefits in the period after December 31, 2018. Meanwhile, Tencent-backed Udaan has laid off 180 employees in a move to “reinvent its business model and keep up with changing market conditions”, a source told FE. The business-to-business trade platform sacked staff across teams such as sales and on-field executives. It, however, said it was extending medical insurance and other benefits to the employees impacted. The IPO-hopeful startup’s decision to sack employees comes despite CEO Vaibhav Gupta saying Udaan’s cash burn had come down by around 40% in the first half of 2022, in an email sent to employees earlier this month. Now an update on the fuel economy. The financial performance of India’s state-owned refining and marketing companies will remain weak as long as their net realised prices for petrol and diesel are lower than international market prices, Moody’s Investor Services said on Monday. “Nonetheless, we do not expect this situation to be sustained. We expect that the Indian government will eventually allow fuel retailers to adjust selling prices, but the price increases will be implemented gradually,” it said. Lending support to the government’s effort to contain inflation, PSUs like Indian Oil Corporation, Hindustan Petroleum and Bharat Petroleum have kept retail fuel prices on hold since May 22. Moving on to the latest market news. Asian shares edge down in early trade on Tuesday with investors taking their cue from a volatile Wall Street session overnight, while oil prices climbed following last week's rout. Oil continued to rise with investors still weighing worries over an economic slowdown against concern over lost Russian supply amid sanctions related to the conflict in Ukraine. For Indian indices, the pre-market cues look very muted as the SGX Nifty was trading lower suggesting a weak beginning for both BSE and NSE today. GMR Infra and Brigade Enterprises are the major stocks in focus today. You were listening to the Expresso Business Update by The Indian Express and The Financial Express. Ask your digital assistant device to play the latest business news from the Indian Express and stay up to date with the happenings in the finance and business stories.
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