A round-up of the biggest articles from newspapers.
PE firms, French company vie for $2.5b Hexaware deal
Private equity groups Bain Capital, Carlyle and KKR are in the fray to acquire Hexaware Technologies for $2.5 billion from Baring Private Equity Asia, reports The Economic Times.Why it's important:
It is potentially the largest IT services buyout in the country.
Financial investors are on the prowl for scaled technology sector assets to take advantage of rising corporate IT spending on cloud services across the US and Europe.
After putting large-scale technology projects on hold in 2020, businesses worldwide switched to remote collaboration and other business continuity tools.
Under the leadership of chief executive R Srikrishna, Hexaware was among the earliest homegrown technology services firms to make a pronounced move to the cloud.
NPCI begins pilot for voice-based payments service
The National Payments Corporation of India (NPCI) is now testing a voice-based payments service for feature phone users in low-connectivity zones, reports The Economic Times.Why it's important:
The service is likely to be rolled out on top of the interoperable UPI protocol.
Both NPCI and RBI are learnt to be testing various feature phone-based payment solutions that cut the need to have an internet connection or an expensive authentication device like biometric scanner or point of sale device.
The service will allow feature phone users to make merchant payments as well as peer-to-peer (P2P) transactions by simply generating an authentication PIN linked to their bank account and debit card as well as the registered mobile number.
SEBI lens on three Adani firms over suspected breach of laws
The SEBI is scrutinising at least three companies controlled by billionaire businessman Gautam Adani for alleged breaches of securities laws, Mint reports.Why it's important:
It's related to prevention of insider trading and inadequate disclosures.
It is to protect public shareholders from unwarranted risks.
The Sebi is looking at whether Adani Ports, Adani Group’s transmission businesses and Adani Gas have made the required disclosures.
Bank investments in IPOs hit a four-year high
Banks and financial institutions have dialled up their investments in IPO through the qualified institutional buyer (QIB) route, touching a four-year high so far in 2021, Mint reports.What it shows:
They are flush with liquidity and there are few takers for loans.
Banks and financial institutions almost doubled their investments in IPOs to Rs 870 crore this year from Rs 461 crore in 2019.
They pumped Rs 698 crore into IPOs.
Lenders leading these investments include IDBI Bank, ICICI Bank, SBI, Axis Bank, Bank of India and Bank of Baroda.
May payroll data highlights the impact of second wave
Fresh payroll additions in May plummeted to 572,634, the worst since June 2020, reports Mint.Why it's important:
It's an indication of the impact the second wave of the covid-19 pandemic has had on the jobs market.
The May figure is 168,636 less than the payroll additions in April, when 741,270 new EPF subscribers were added.
In March, it was 716,223 and it was 807,482 in February, while in January 883,392 people had joined formal employment.
Youth suffer: Of the total fall in new payroll additions in May, the crucial 18-25 age group faced the brunt.
The fall in new payroll addition numbers among youth also strengthens the view that youngsters are facing a tougher time in the labour market.
Overseas remittances can be filed manually till mid-August: CBDT
The Central Board of Direct Taxes (CBDT) allowed manual filing of forms related to foreign remittances till 15 August, Mint reports.Why it's important:
It is considering that since the launch of the new income tax department portal on June 7, taxpayers have been facing technical glitches.
This is the third extension by CBDT for manual filing of Forms 15CA and 15CB.
Income of NRIs sourced from India is taxable and, those who make the remittance from India, are required to report the transactions under the Income Tax Act.
Centre mulls Ordinance as tax litigation mounts
The government is exploring legal options, including bringing an Ordinance, to tackle the problem of income-tax litigation on reassessment notices under old, time-barred norms, Business Standard reports.Why it's important:
This has come in the wake of writ petitions filed by companies and individuals in recent weeks to challenge the validity of the reassessment notices.
They say I-T action is void and arbitrary; the department can’t extend the validity of old law.
Old law was in effect till March 31, and later got extended till June 30.
If courts rule in favour of assessees, it will have a significant bearing on revenues.
Pension funds can soon invest in IPOs
Pension fund managers will soon be allowed to invest in initial public offerings (IPOs), Business Standard says.Why it's important:
It’s a “good opportunity” to put money into companies at an early stage.
They will also be able to invest in follow-on public offers and offer for sale of companies.
BSE-200 and NSE200 firms whether they are part of F&O or not.
Guidelines to be released in a week.
Conditions will include the company's profitability, dividend payment record.
PFRDA Chairman Supratim Bandyopadhyay says: “Pension funds have been missing out on good opportunities to invest in IPOs. We have seen good companies coming out with their IPOs that provide an opportunity to invest at an early stage and benefit from their growth.”
Microsoft in talks with Telangana to set up Rs 15,000-crore data centre
US tech giant Microsoft is in the final stages of talks with the Telangana government to set up a data centre with a total investment of Rs 15,000 crore, Business Standard reports.What the plans are:
The company has zeroed in on a land parcel near Hyderabad for the facility.
It may come out with a public announcement soon, said a source.
Besides Microsoft, other global players such as BAM Digital Realty, Amazon Web Services and Google are stepping up their presence in the data centre segment in the country.
Data centre revenues are estimated at about $4 billion by 2024.
‘Major outsourcing wave will return to India over one-two years’
While Indian IT services players are focusing on global markets, the IBM Global Business Services (IBM GBS) arm is expanding its footprint in India. Kamal Singhani, country managing partner, IBM GBS, tells Business Standard about the outsourcing trends, adoption of cloud, digital and AI by Indian enterprises and their approach to startups.What he says:
If you look at IBM over 60 per cent of business now comprises services.
For IBM GBS, India forms a big part of the APAC region.
IBM is pivoting into a hybrid, cloud and AI-driven company.
Clients are looking at strategic partners and engaging with those with end-to-end vision and capability.
In this shift, IBM GBS is emerging as a partner of choice.
Kyndryl is going to be a different brand and IBM and Kyndryl will continue to have a strategic partnership.
We see a huge wave of outsourcing coming back to India.
There will be a significant amount of process outsourcing, in areas such as finance &accounting and procurement transformation outsourcing.
IOC Chairman: Green energy to power new capacity
IOC chairman Shrikant Madhav Vaidya shared with The Times of India his vision for transforming India’s largest state-run oil refiner and fuel retailer into a new age energy major.What the Chairman says:
We have to be in sync with the government saying that, by 2050, we all should be net-zero.
That can be broken into categories: One, what energy we use. The second is grid power. Third is what we produce and is being used, such as petrol and diesel, which becomes net-zero.
We are investing in solar and wind energy in a big way.
The intention is to run all expanded capacity on green power.
Fossil fuels will be there but gas will play a big role because the government has rightly chosen it as the transition fuel.
We are committed to CNG and CBG (compressed biogas).
We are also investing in producing hydrogen with 99.999 purity for hydrogen fuel cell buses.
All these will contribute towards net-zero.
Snapdeal flips business model, won’t sell high-end brands
Homegrown online marketplace Snapdeal, which was once competing with Flipkart and Amazon, has flipped its business model to target the value-conscious end of the market, The Times of India reports.
Why it's important: To cater to the lower end of the market, Snapdeal has used its resources to build capabilities to provide depth in assortment and optimise its supply chain to reach remote areas.Kunal Bahl, founder & CEO at Snapdeal,
says: “We are very clear about the customers we are serving and that they are primarily ‘value shoppers’. So we won’t sell very expensive items or high-end brands.”“A sizable part of the country, especially very small towns, and villages still don’t get doorstep service from e-commerce.”