BUSINESS
Regulation | RBI move to seek IL&FS exposure disclosure a welcome step
It was also important for RBI to ask banks to make this disclosure as it bids to regain the higher ground after recent setbacks
BUSINESS
Policy Primer | Could insolvency pre-packs have saved Jet Airways?
In a pre-pack, a stressed company can find a buyer before actually declaring insolvency and also get the benefits of bankruptcy such as exemption from SEBI norms.
BUSINESS
Macro Meter | Why is investment growth so tepid?
The tailwind to increasing investment rates from declining capital goods prices has petered out
MARKETS
Corporate Corridor | Kotak Mahindra Bank needs to be held to higher governance standards
By proposing the use of perpetual non-cumulative preference shares to cut promoter holding, Kotak, the promoter, is guilty of not complying with the spirit of the law. So too, Kotak Mahindra Bank and its independent directors.
BUSINESS
Comment | The curious case of sticky bond yields
As long as the public sector continues to soak up 8-9 percent of GDP as funding, bond yields will continue to remain elevated.
POLITICS
Opinion | BJP manifesto promises a sop for every constituency
All manifestos tend to make a lot of promises, but the key failing with this one is the lack of a central idea beyond saying “Vote for us. Else, India has no hope.”
MARKETS
Comment | The lingering effects of the IL&FS crisis
Small businesses got hurt for the third straight year after demonetisation in 2016-17 and GST in 2017-18.
BUSINESS
Comment | Supreme Court judgement a setback to the bankruptcy code
The circular was important to break the cycle of extend and pretend that has been the hallmark of the Indian banking system for quite some time. Bankers were content to kick the can down the road and delay the recognition of bad loans and show rosy bottom line numbers.
INDIA
Chart of the day | What’s happening with stalled projects?
There is a distinct lack of interest in new investments and the private sector isn’t even enthusiastic in reviving stalled projects
BUSINESS
Opinion | Electoral bonds perpetuate culture of dirty money entering politics
Why make it easier for foreign entities to fund Indian elections?
BUSINESS
Comment | Swap-induced bond rally will run out of legs
Don’t expect a runaway rally in bond prices even if the central bank’s rate setting committee cuts the policy rate next week as is widely expected.
BUSINESS
Comment | The many sides to L&T’s acquisition of Mindtree
The hostile takeover brings into sharp focus a key lesson for founders that look to retain control with small shareholdings: have a backstop or a white knight to bail you out.
POLITICS
Comment | It’s not the economy, stupid!
A recent paper goes through surveys, election results and social spending data from 1962 to 2014 and arrives at a simple conclusion: Voter choices in Indian are driven more by caste and identity politics rather than economic interests.
POLITICS
Opinion | Want to understand GDP data manipulation? Watch The Matrix
In a democracy, manipulating and suppressing data is akin to shooting yourself in the foot.
BUSINESS
100-word take | A slow capex recovery has taken root
Improved capacity utilisation…provides a lead indication of a “reinvigoration of investment activity,” says RBI staff paper.
INDIA
Opinion | Indian stocks are just playing catch up, Modi’s return irrelevant to markets after elections
Things haven’t changed much fundamentally on the ground. Indian indices still trade at 18 times one-year ahead earnings – marginally higher than at beginning of the year – although the valuation premium with respect to other markets has come down.
BUSINESS
Opinion | Deferring Ind-As for banks is no solution
Transition to the new norms will be yet another step in the overhaul of the credit culture, especially at state-owned banks. It should be viewed as part of the larger efforts of RBI to improve governance and prevent another massive pile up of soured loans.
BUSINESS
100-word take | The one chart that shows distress among developers
Around 15-20 percent of developer debt, amounting to at least $10 billion (Rs 70,000 crore) is at the risk of turning sour.
ECONOMY
Comment | Public sector bank reforms: Baby steps taken, a long way to go
It is a reflection of the sad state of affairs in Indian public sector banking that the government/external agencies have to hand hold lenders to ensure that basic hygiene is followed when extending loans.
BUSINESS
Comment | Private sector bank CEO pay: RBI steps in to do board’s job
The proposed norms will help improve governance in private sector banks. Reforming boards and holding them more accountable should be the next step.
INDIA
Comment | Credit policy meeting minutes show April rate cut is not a given
It appears that those members who voted for a rate cut have factored in all the positives about inflation. The focus has definitely shifted to growth, but alarm bells aren’t ringing yet.
INDIA
Comment | Discom defaults: who will bell the cat?
While it is easy to blame discoms, remember that they are also under political pressure to not increase tariffs and turn a blind eye towards theft etc
BUSINESS
Opinion | In the Yes Bank drama, RBI has shot itself in the foot
The central bank should embrace more transparency, with better explanations for regulatory actions.
BUSINESS
Comment | A light at the end of the tunnel for Jet
For a sustainable turnaround, not only is fresh capital needed, but also fresh thinking
