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RBI Simplifies Bankruptcy Guidelines et al

Professor of Financial Economics and Part-time Value Investor, Transfin.
Feb 13, 2018 2:43 PM 2 min read


End of Day Wrap-up (Tuesday / February 13, 2018) #RBI #NCLT #IBC #Pharma #Healthcare #AdityaBirla #Idea #Cars #Automobile #Amazon #Transfin

Editor's comment: RBI simplifies bankruptcy guidelines under a single code by absorbing S4A, ownership norms on stressed accounts, guidelines on Joint Lenders' Forum and Corrective Action Plan within IBC. If default triggered in the borrower's account for one lender within the consortium, all lenders shall initiate steps to recover dues. Harmonisation's objective is to avoid chances of banks within the same consortium classifying the same defaulting account differently.


Pharma pricing regulator further reduces ceiling prices for the most commonly used drug-eluting stent (DES) by 5.8% citing "public interest". Maximum permissible trade margin at 8%. Multinational stent manufacturers like Abbott, Medtronics, Meril Lifesciences, Boston Scientists oppose price control on grounds it will push back R&D and innovation.


Promoter Aditya Birla Group injects INR3,250cr into Idea Cellular through preferential share allotment. INR3,500cr more to be raised in future. Capital to be further enhanced by proceeds of sale of Idea and Vodafone India's tower sale to American Tower Corporation for EV of INR7,850cr and monetisation of Idea's 11.15% stake in Indus Towers.


Indian commercial auto sales up 40% y-o-y for Jan 2018, highest per month since July 2017. Three wheelers sales up 100% and two-wheelers up 33%. Passenger Vehicle growth slowest at 7.6%.


Government plans to privatise Pawan Hans, Dredging Corp, HLL Lifecare, IMPCL, and 5 ITDC hotels to meet its budgeted target of INR80,000cr disinvestment proceeds by 2018-19.