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Zomato Prepares to Take On Swiggy, Sensex and Nifty Slump, Govt to Amend IT Act to Check Fake News et al.

Professor of Financial Economics and Part-time Value Investor, Transfin.
Jan 2, 2019 1:37 PM 3 min read
Editorial

GST collections slip. Zomato prepares to take on Swiggy. RBI anounces restructuring scheme for MSMEs. Govt to amend IT Act to curb fake news. 

 

Now to Today's Top Business News Stories in Our End Of Day Wrap Up:

Zomato Prepares to Take On Swiggy, Sensex and Nifty Slump, Govt to Amend IT Act to Check Fake News et al.

 

GST

India clocks highest direct tax-GDP ratio in FY18. GST collections slip in November. SMEs may get GST relief ahead of 2019 elections as govt might consider raising the sales threshold for compulsory GST registration.  

The What: As per a Business Standard report, India reported a direct tax-to-GDP ratio of 5.98% during FY18 (the best in the last 10 years) vs. 5.57% in FY17 and 5.47% FY16.

Up Close: GST collections stood at INR94,726cr in November vs. INR97,637cr in October. As per a BloombergQuint report, the government has so far collected c. INR9L crore as GST in eight months against the full-year budget target of INR13L crore.

 

Perspective: The news comes shortly after the GST Council cut rates on 23 goods and services, leaveing only "sin" or "luxury" goods, besides cement, large screen TVs, Air Conditioners and dishwashers within the 28% bracket.

 

Tax relief for SMEs: As per a Livemint report, the GST Council may consider raising the sales threshold for compulsory GST registration from INR20L to INR75L for SMEs to ease compliance burden.

 

RBI

RBI anounces restructuring scheme for MSMEs.

 

What a relief: RBI announces scheme to recast loans up to INR25cr of Micro, Small and Medium Enterprises (MSMEs) that are under stress but are not yet classified as bad loans
 

Bigger Picture: SMEs were the worst hit following demonetization and implementation of GST. Availability of credit to MSMEs was further affected by the IL&FS crisis, which reduced bank lending to NBFCs, in turn resulting in shortage of funds for MSMEs which were funded by these NBFCs. 

 

FOOD

Zomato in talks to raise up to $1bn to take on Swiggy.
 

Game on: As per an Economic Times report, Zomato is in talks with potential investors including Chinese private equity major Primavera Capital and existing backer Ant Financial to raise funds worth $500m- $1bn to take on competitor Swiggy.

 

Perspective: The development comes shortly after Swiggy raised $1bn led by existing investor Naspers which increased its value to $3.3bn.

 

INTERNET

Govt to amend IT Act to curb fake news and child pornography.

 

The What: The Ministry of Electronics and Information Technology (MeitY) is scheduled to meet on January 5 to discuss potential amendments to the IT Act which seeks to regulate social media giants, curb the spread of fake news, child pornography and more.

 

Up Close: Proposed changes to include imposition of steeper penalties. Non-compliance with the guidelines may also result in the shutdown of a website.

Zomato Prepares to Take On Swiggy, Sensex and Nifty Slump, Govt to Amend IT Act to Check Fake News et al. 

 

AVIATION

Jet Airways defaults on debt payment to banks led by SBI, stock plunges over 5%, rating downgraded.

Jet woes: As per a Business Standard report, Jet Airways has delayed the payment to a consortium of Indian banks, led by State Bank of India on back of severe cash crunch.

Crash and downgrade: Stock crashes c. 7%. ICRA downgrades long-term rating of Jet Airways to D from C.

 

MARKETS

Sensex slumps over 360 points, NIFTY dives 117 points dragged by auto, metal stocks.
 

The What: BSE Sensex closed 363.05 points, or 1%, down at 35,891.52, and the Nifty 50 ended 117.60 points, or 1.08%, lower at 10,792.50 on back of global market volatility and uncertainty ahead of 2019 general elections.

 

Up Close: Both NIFTY Auto and NIFTY Metal fell over 3%. Sun Pharma, TCS, Asian Paints, Infosys, Yes Bank and ICICI Bank, Eicher Motors, Tata Steel, M&M and JSW Steel were among the top losers.

 

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