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Cabinet Approves Launch of India’s First Bond Exchange-Traded Fund - Bharat Bond ETF And Other Top Business News Today

Professor of Financial Economics and Part-time Value Investor, Transfin.
Dec 4, 2019 2:03 PM 5 min read

Google CEO Sundar Pichai to take over as CEO of Alphabet. Cabinet approves launch of India’s first bond exchange-traded fund - Bharat Bond ETF. Govt orders e-pharmacies to halt sales. Cabinet clears Personal Data Protection Bill.




Google CEO Sundar Pichai to take over as CEO of Alphabet.

Acing the Game: Google CEO Sundar Pichai is set to take over as the CEO of parent Alphabet as current CEO Larry Page is stepping down. 


In addition to this, Brin is stepping down from his role as Alphabet’s president.



"...Alphabet and Google no longer need two CEOs and a President. Going forward, Sundar will be the CEO of both Google and Alphabet. He will be the executive responsible and accountable for leading Google, and managing Alphabet's investment in our portfolio of Other Bets," said Page and Brin. TechCrunch


Bonus Read: Walmart in 2018 announced a whopping $16bn investment in Indian e-commerce startup Flipkart. However, over the past year or so, policy-makers in India have begun tightening requirements for how US tech companies need to structure their operations and handle data collected from Indian customers, perhaps taking a cue or two from China. With India representing "the world’s biggest market for what executives refer to as the next billion users - consumers who have never searched or shopped online or made a digital payment," what does this mean for the international tech giants? WSJ



The RBI is expected to cut rates once again tomorrow - fifth in a row, but to what effect?

Nothing Really Matters: In under a year, the Reserve Bank of India (RBI) has cut interest rates by 135 basis points and flooded the banking system with a surplus liquidity of nearly INR2tr. To top this, RBI governor Shaktikanta Das, in his last policy, had said that the RBI was willing to keep rates soft as long as it takes to revive the economy. However, this expansionary monetary policy has not really shown any palpable results. 


As per this Livemint report, the biggest challenge the Central Bank currently faces is to restore trust in its financial markets, this is, making mutual funds and banks lend to firms, including non-banking financial companies. It also needs to push banks to lower lending rates and perhaps manage market yields. Meanwhile, it will have to ensure that the INR2tr worth surplus liquidity begins to at least support the sovereign bond market.


As per popular consensus, the RBI is expected to cut interest rates again tomorrow - for the sixth straight time. But to what effect? The spread between bank's lending rates and India's key policy rate has been the widest on record this year. And as per this Bloomberg article, quantitative easing is perhaps the only remedy that can work (needless to say conditions apply.)



Hyundai commits to produce electric and autonomous cars, to spend $17bn in the next six years

In a bid to transform itself into a producer of electric and autonomous cars, South Korean-manufacturer Hyundai Motor Co is set to spend $17bn over the next six years on new technology.


If successful, the plan should create a more profitable business with a global market share of 5 per cent in 2025, up from 4 per cent in 2018, the company said. Hindu BusinessLine

Wipro acquires South African personal care company Canway.

Wipro Consumer Care and Lighting (WCCL), the consumer care business of software provider Wipro has acquired South African personal care maker Canway Corporation. 


The transaction, the deal size of which was undisclosed, is now subject to the approval of regulatory authorities. 


The deal is expected to give Wipro Consumer a greater access to South Africa which is the largest personal care market in Africa, and where it already has a small presence with flagship soap brand Santoor. ET FMCG



Cabinet approves launch of India’s first bond exchange-traded fund - Bharat Bond ETF.

Go-Ahead: The Cabinet today approved the launch of India's first bond exchange-traded fund - Bharat Bond ETF, which is expected to create a new window for fundraising by state-owned firms, and give affordable entry to retail investors in the bond market.


The Bharat Bond ETF will be a basket of bonds issued by public sector firms or any government organisation, and will be tradeable on the exchanges. The unit size will be Rs 1,000, allowing even small investors to invest.


All you need to know about Bharat Bond ETF here.

Govt orders e-pharmacies to halt sales.

In a rather strong blow to e-pharmacies, the government today has ordered a halt to online drug sales. The development comes after an order by the Drugs Controller General of India (DGCI) directed all states and Union territories to prohibit the sale of medicines through unlicensed online platforms. The DGCI order made it clear that the ban will prevail until draft rules to regulate e-pharmacies are finalised. 


On The Other End: E-pharmacies have always claimed that their business model is well covered by the Information Technology Act, 2000 under the concept of intermediaries, and the pharmacy retail operations are covered by the Drugs and Cosmetics Act. CNBC TV18


Cabinet clears Personal Data Protection Bill.


Cabinet clears Personal Data Protection Bill.

Govt On A Roll: The Union Cabinet has approved the Personal Data Protection Bill, which shall contain broad guidelines on collection, storage and processing of personal data, consent of individuals, penalties and compensation, code of conduct and an enforcement model.


Information and Broadcasting Minister Prakash Javadekar said the Bill would be introduced in Parliament during the ongoing Winter Session. Business Today




SAT refuses relief to lenders in Karvy case.

No More Relief: Securities Appellate Tribunal (SAT) has refused to give any further relief to HDFC Bank, ICICI Bank, Bajaj Finance and Indusind Bank in Karvy Broking share pledge case.


Previously, Bajaj Finance and other banks had moved SAT seeking directions against Securities & Exchange Board of India (SEBI) and National Securities Depository Ltd (NSDL) for securing shares pledged by Karvy to them. On December 3, in an interim relief, SAT had ordered NSDL to not transfer any more shares to Karvy clients. ET Markets


In Other News: In the wake of the Karvy crisis, SEBI has given time to at least six brokers to wind up their client securities accounts and submit the progress reports on pledged securities used to raise money from banks and finance firms.


As per sources,SEBI had identified some brokers, mostly mid-sized ones, who had not just failed to separate client shares but raised loans and utilised them in their other ventures. The regulator wants these brokers to remove the pledges and return the shares to the clients (those who paid the dues). BS 


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