Honourable Supreme Court’s decision last week disallowing “Compensatory Tariff” to Tata Power and Adani Power brings back this power sector invention into limelight. The compensation had earlier been awarded to these companies by the Appellate Tribunal for Electricity (Aptel) to compensate for unforeseen increase in the cost of generation. However, this concept is unique since no other industry … Continue reading Understanding "Compensatory Tariff"..
The recent decision of the government, with the direct involvement of the Prime Minister’s Office (PMO), to crack down on shell companies brings focus on the operation of these companies. Shell companies have been in focus and subject of intense debate not just in India but globally also, especially after the leaked Panama Papers. A look … Continue reading Understanding Shell Companies…
NPAs of the banking sector, especially the public sector continue to remain high, estimated at about 12% for PSBs. While various measures have been taken to resolve the issue, none seems to have worked so far. This has led to the proposal of creating a public sector asset rehabilitation agency (PARA) by the Economic Survey, … Continue reading Resolving NPAs – Understanding Asset Rehabilitation Agency..
The confirmation by Vodafone Plc recently that it is in talks with Idea Cellular for potential merger of Vodafone India is another big churn in the Indian Telecom sector. While R-Jio’s entry was expected to disrupt the market, that the second largest player would call it quits is unanticipated and quite shocking. A look at … Continue reading Vodafone-Idea Merger Proposal – The Rationale..
Consider a situation where a foreign entity provides loan to an Indian company and receives interest which is not fixed but linked to profits. Or consider a treaty between India and country X whereby sale of shares in an Indian company held by an investor from country X shall be taxed only if the shares … Continue reading Understanding GAAR (General Anti-Avoidance Rules)..
Steel industry has been reeling under severe pressure due to sharp increase in imports, continued domestic capacity expansion and lately, rise in key raw material prices. While government support in the form of imposition of minimum import price (MIP) and safeguard duty has helped it, the industry is still struggling to find market for new commissioned … Continue reading Industry Analysis – Steel Industry..
Corporate sector have improved its financial position substantially during first half of 2016-17 as per the Financial Stability Report published by RBI last week. However, the impact of this on bank NPAs is still not visible. Gross NPAs of the banks has increased during the last six months and may take some more time before … Continue reading Corporate & Financial Sector Performance – RBI Report..
It had been an interesting year for Corporate India. Sectors which saw maximum action were Telecom, Oil & Gas and Cement. The year also saw a number of sell-offs, largely to tide over the cash flow crisis. A look at some of the highlights: Tata – Mistry tussle – In an unprecedented move, Tata Sons … Continue reading 2016, The Year That Was – Corporate & Industry..
The announcement on buyout of Gujarat State Petrochemical Corporation’s (GSPC) assets in K-G basin block by ONGC earlier this week puts an end to GSPC’s audacious attempt to establish itself as an important gas producer. GSPC struggled for more than half a decade to extract gas from the field after a high profile announcement on … Continue reading Understanding ONGC – GSPC Gas Block Deal.
Vodafone India is to Vodafone plc what Tata Steel Europe is to Tata Steel..! Vodafone plc’s recent decision to write-off € 6.4 billion (nearly Rs 46,000 crore) with respect to vodafone India’s operation confirms this. This is the second write-off by Vodafone plc related to India, the first being in 2010 for € 2.3 bn and … Continue reading Vodafone – Another case of costly acquisition and write-off…