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Table of Contents
Core Sector Growth Surges to 3-Month High of 6.7% in February
The output growth of India’s eight core industries reached a three-month high of 6.7% in February 2024, reversing a trend of slowing growth in previous months. The cumulative growth for the period April-February 2024 stands at 7.7%, slightly lower than the 8.2% recorded in the same period last year.
Key Points
Overall Growth – Eight core industries’ output growth reached 6.7% in February 2024, a three-month high. – Cumulative growth for April-February 2024 is 7.7%, lower than the 8.2% in the same period last year.
Sectoral Performance – Seven of the eight core industries showed positive growth in February 2024. – Fertilizers was the only sector to contract, with a 9.5% decline.
Individual Sector Growth – Coal: 11.6% – Crude oil: 7.9% – Natural gas: 11.3% – Refinery products: 2.3% – Fertilizers: -9.5% – Cement: 10.2% – Steel: 8.4% – Electricity: 6.3%
IIP Expansion – Core sector growth is expected to boost the Index of Industrial Production (IIP) to an expansion of 6.0-6.5% in February 2024.
Expert Analysis – Aditi Nayar of ICRA Ltd. attributes the growth to improvements in six of the eight core industries, except for fertilizers and steel. – Madan Sabnavis of Bank of Baroda highlights the all-round performance across sectors, with the exception of fertilizers, which is attributed to a high base effect and reduced demand during harvest season.
Karnataka Bank Approves Equity Share Issuance to Qualified Institutional Buyers
Karnataka Bank Ltd has issued and allotted 2,64,31,718 equity shares to 25 qualified institutional buyers at an issue price of ₹227 per share, raising a total of ₹599,99,99,986. The bank’s paid-up equity share capital has increased from ₹3,50,81,82,400 to ₹3,77,24,99,580.
Key Points:
- Issue and Allotment:
- 2,64,31,718 equity shares issued and allotted to 25 qualified institutional buyers.
- Issue price: ₹227 per share, including a premium of ₹217 and a discount of ₹4.43.
- Total funds raised: ₹599,99,99,986.
- Paid-Up Equity Share Capital:
- Increased from ₹3,50,81,82,400 to ₹3,77,24,99,580.
- Shareholding Pattern:
- To be submitted to stock exchanges along with listing application.
- Allottees with Over 5% Stake:
- HSBC Mutual Fund (25%)
- SBI Life Insurance Company Ltd (12.5%)
- Franklin India Smaller Companies Fund (12.5%)
- Max Life Insurance Company (8.33%)
- Morgan Stanley Asia Singapore PTE (7.67%)
- HSBC Global Investment Funds (5.5%)
State Governments’ Borrowing Costs Decline by 20 Basis Points to 7.52% in FY24
Despite a 33% surge in issuance, the weighted average cost of State Government Securities (SGS) declined by 20 basis points to 7.52% in FY 2024. This was primarily driven by a sharper decline in rates for longer tenor papers.
Key Points
Issuance and Cost – 26 state governments and 2 Union Territories issued ₹10.1 lakh crore in SGS in FY2024, a 33% increase from FY2023. – The weighted average cut-off (WAC) of SGS dipped by 20 basis points to 7.52% in FY2024, from 7.71% in FY2023.
Tenor and Maturity – The share of longer tenor paper increased to 63% in FY2024 from 55% in FY2023. – The weighted average maturity (WAM) of SGS remained unchanged at 14 years.
State-wise Variations – Kerala had the highest WAM at 22 years, while Gujarat had the lowest at 7 years.
Borrowing Patterns – Gross borrowing was 7% lower than indicated by states to the RBI. – Net borrowings increased by 38% to ₹7.2 lakh crore in FY2024. – Q4 FY2024 saw the highest quarterly borrowing at ₹4 lakh crore.
Top Borrowers – Tamil Nadu remained the top borrower with ₹1.13 lakh crore in issuance. – Maharashtra, UP, Karnataka, Rajasthan, and Andhra Pradesh accounted for over half of the total borrowing.
Factors Influencing Borrowing – Preference for holding larger cash before Parliamentary elections. – Anticipation of delayed borrowing permission from the Government of India.
Government Announces 3-10% Increase in MGNREGA Wages for 2024-25
Ahead of the general elections, the Indian government has announced a 3-10% increase in MGNREGA wages for the financial year 2024-25, effective from April 1, 2024. The average wage increase is ₹28 per day, bringing the average wage to ₹289. The highest percentage increases are in Goa and Karnataka, while the lowest are in Uttar Pradesh and Uttarakhand. The wage rates are based on changes in the CPI-AL and vary across states.
Key Points
Wage Increase – 3-10% increase in MGNREGA wages for 2024-25 – Average wage increase of ₹28 per day – Average wage for 2024-25: ₹289
State-wise Variations – Highest percentage increase: Goa (10.56%), Karnataka (10.4%) – Lowest percentage increase: Uttar Pradesh (3%), Uttarakhand (3%) – Robust percentage increases: Andhra Pradesh (10.29%), Telangana (10.29%), Chattisgarh (9.95%)
Wage Determination – Wages based on changes in CPI-AL (Consumer Price Index- Agriculture Labor) – Base year for wage calculation: 2009-10 (considered obsolete)
Other Considerations – Election Commission’s permission obtained to notify wage rates – States can provide additional wage rates over and above the notified rates – Parliamentary Standing Committee highlighted inadequate wages and high variation across states – ₹86,000 crore allocated for MGNREGA in Union Budget 2024-25
Treasury Gains Expected to Boost Bank Profits in Q4FY24
Bank treasuries have experienced a positive end to FY24, with Government Securities (G-Secs) yields declining year-over-year and quarter-over-quarter. This softening of yields is expected to boost bank profitability in the fourth quarter and the financial year.
Key Points:
G-Secs Yield Softening: – 10-year G-Sec yield softened by 26 basis points year-over-year and 12 basis points quarter-over-quarter. – Price of the 10-year G-Sec closed higher than December and March 2023 closing prices.
Factors Contributing to Yield Softening: – Lower gross borrowing announced in the Union Budget for FY25. – Possibility of a repo rate cut in the second quarter. – Inclusion of G-Secs in global bond indices.
Impact on Bank Profitability: – Treasury gains expected to buoy bank profitability in the fourth quarter and financial year. – Banks that provisioned for mark-to-market losses may see write-backs.
Future Yield Movement: – Next major trigger for yield movement is the bi-monthly monetary policy review. – Hint of a rate cut could push benchmark paper yield towards 6.80% in Q1 or Q2.
Pankaj Dwivedi Assumes Role as Executive Director at Union Bank of India
Pankaj Dwivedi has been appointed as an Executive Director at Union Bank of India (UBI), bringing the total number of EDs to four. Dwivedi has over 31 years of banking experience, previously serving as General Manager at Punjab & Sind Bank.
Key Points:
- Appointment of Pankaj Dwivedi as Executive Director:
- Pankaj Dwivedi has been appointed as an Executive Director at Union Bank of India.
- Number of Executive Directors:
- UBI now has four Executive Directors, including Dwivedi.
- Other Executive Directors:
- The other Executive Directors are Nitesh Ranjan, Ramasubramanian S, and Sanjay Rudra.
- MD & CEO:
- A Manimekhalai is the MD & CEO of UBI.
- Previous Experience:
- Dwivedi previously served as General Manager at Punjab & Sind Bank.
- Banking Experience:
- Dwivedi has over 31 years of banking experience.
India Considers Trade Blocs with China if WTO Compliance is Met: Piyush Goyal
India is willing to join trading blocs that include China, provided that China adheres to the principles of openness, transparency, and compliance with World Trade Organization (WTO) regulations.
Key Points:
- India’s Openness to Trading Blocs: India is open to participating in trading blocs that include China.
- Conditions for Participation: India’s participation is contingent on China ensuring its economy is open, transparent, and compliant with WTO rules.
- WTO Compliance: India emphasizes the importance of adhering to WTO regulations to ensure fair and equitable trade practices.
- Transparency and Openness: India seeks transparency and openness in China’s economic policies to foster trust and cooperation.
- Future Developments: The article suggests that further details on India’s stance will be provided in the future.
Real Estate Loans Surge Fourfold in February
Bank lending in India witnessed a significant increase in February 2024, with loans to real estate surging four-fold. Loans to services accelerated, while retail loan growth moderated. Lending rates declined from January but remained higher than the previous year.
Key Points:
Loan Growth:
- Non-food bank credit rose 16.5% year-on-year in February 2024.
- Loans to services grew by 21.2% year-on-year, driven by trade and commercial real estate.
- Loans to commercial real estate surged 37.9% year-on-year.
- Retail loan growth moderated to 18.1% year-on-year due to slower growth in vehicle and personal loans.
- Credit to industry increased by 8.6% year-on-year.
- Credit to agriculture and allied activities rose 20.1% year-on-year.
Lending Rates:
- Weighted average lending rate (WALR) on fresh rupee loans fell to 9.36% in February 2024.
- WALR on outstanding rupee loans was 9.83% in February 2024.
- Share of EBLR-linked loans in total floating rate rupee loans increased to 56.2%.
Deposit Rates:
- Weighted average domestic term deposit rate on fresh rupee term deposits rose to 6.44% in February 2024.
- Weighted average domestic term deposit rate on outstanding rupee term deposits was 6.86% in February 2024.
Kotak Mahindra Bank Acquires Sonata Finance for Rs. 537 Crores
Kotak Mahindra Bank has acquired Sonata Finance Pvt Ltd, a microfinance NBFC, for Rs 537 crore. Sonata operates in 10 states with 549 branches and has an AUM of approximately Rs 2,620 crore. The acquisition makes Sonata a wholly-owned subsidiary of Kotak Bank.
Key Points:
- Acquisition: Kotak Mahindra Bank has acquired Sonata Finance Pvt Ltd for Rs 537 crore.
- Sonata’s Operations: Sonata operates in 10 states through 549 branches.
- Sonata’s AUM: Sonata has an Asset Under Management (AUM) of approximately Rs 2,620 crore as of December 31, 2023.
- Sonata’s Status: Sonata has become a wholly-owned subsidiary of Kotak Bank.
Banks Poised to Benefit from Declining Bond Yields
Commercial banks are expected to benefit from trading gains due to a decline in bond yields during the January-March quarter and the full financial year 2023-2024. The fall in yields was driven by foreign inflows, favorable demand-supply dynamics, and improved liquidity conditions.
Key Points:
Yield Decline: – 10-year government bond yield fell by 14 basis points in the January-March quarter. – 5-year government bond yield fell by 8 basis points. – 14-year government bond yield fell by 23 basis points. – Benchmark yield fell by 26 basis points over the financial year 2023-2024.
Factors Contributing to Yield Decline: – Foreign inflows – Favorable demand-supply dynamics – Improved liquidity conditions – US Federal Reserve Committee hinting at rate cuts in 2024
Benefits for Banks: – Treasury gains – Improved mark-to-market position – Write-back of provisions
Liquidity Conditions: – Liquidity deficit in the system reduced to Rs 40,981 crore on Wednesday. – RBI conducted variable-rate repo auctions to infuse liquidity.
Foreign Inflows: – Foreign investors infused Rs 53,051 crore in the debt market during the quarter. – Early-stage capital inflows from FPIs ahead of Indian bonds’ inclusion in the J P Morgan index.
Borrowing Programme: – Central government plans to borrow 53.07% of its full-year borrowing target in the first half of FY25. – Lower borrowing programme surprised the market and contributed to yield decline.
Government’s Total Debt Obligations Reach Rs 160.69 Trillion as of December
The Indian government’s total gross liabilities increased slightly to Rs 160.69 lakh crore at the end of December 2023, a 1.8% increase from the previous quarter. Public debt accounted for 90% of these liabilities, with the maturity profile of outstanding debt showing an elongation. The roll-over risk in dated securities remains low, with only 5.2% of outstanding stock needing to be repaid annually over the next five years.
Key Points:
Total Gross Liabilities: – Increased to Rs 160.69 lakh crore at the end of December 2023. – Quarter-on-quarter increase of 1.8%.
Public Debt: – Accounted for 90% of total gross liabilities. – Yield on Indian domestic bonds initially rose but softened later.
Maturity Profile: – Proportion of debt maturing in less than one year decreased to 4.1%. – Proportion of debt maturing within 1-5 years decreased to 21.8%. – Debt maturing in the next five years worked out to 25.9% of total outstanding debt.
Roll-Over Risk: – Remains low, with only 5.2% of outstanding stock needing to be repaid annually over the next five years.
India’s Growth Potential: RBI DG Patra Envisions 10% Growth Rate in the Coming Decade
India has the potential to achieve a 10% growth rate in the coming decade, according to RBI Deputy Governor MD Patra. This growth is driven by the country’s strengths, including a strong economy, a skilled workforce, and a favorable investment climate. If achieved, India could become the second largest economy in the world by 2032 and the largest by 2050.
Key Points
Growth Potential – India has the potential to achieve a 10% growth rate in the coming decade. – This growth is driven by the country’s innate strengths, including a strong economy, a skilled workforce, and a favorable investment climate.
Economic Indicators – Real GDP is growing at the fastest pace among major economies. – Inflation is approaching its target. – The external balance sheet is stronger than ever before. – Fiscal consolidation is into its third consecutive year.
Corporate Sector – The corporate sector has deleveraged and is poised to launch a new cycle of capital investment.
Financial Sector – The financial sector is sounder and more resilient.
State of the Economy – India’s growth trend is on the cusp of a post-pandemic upshift. – Private consumption, investment, and exports are driving growth. – Public expenditure on infrastructure is taking over as the locomotive of the step-up in the growth trend.
Challenges – Expanding the contribution of the workforce to GDP growth. – Increasing female labor participation. – Scaling up infrastructure investment. – Developing a strong manufacturing sector. – Adapting to the fourth industrial revolution.
Foreign Portfolio Investment (FPI) Inflows Surge to Unprecedented ₹3.33 Lakh Crore in India
India has witnessed record-breaking overseas inflows of ₹3.33 lakh crore ($40.4 billion) in equities, debt, and hybrid instruments during the current financial year. This surge, 25% higher than the previous high, has positioned India as a preferred destination for global investors, surpassing other Asian markets except Japan.
Key Points:
Equity Flows:
- India received over $25 billion in equity flows, exceeding all other Asian markets except Japan.
- Emerging market investors in the US are favoring MSCI ex-China ETFs, potentially contributing to India’s inflows.
Market Cap and Global Indices:
- India’s market cap is the fifth largest globally, but its weight in global indices remains low.
- As market free float increases and weight anomalies are resolved, India’s weight in indices is expected to rise.
Economic Performance:
- India’s strong economic performance, despite global challenges, has attracted foreign investors.
- Domestic-led growth and migration to urban areas provide further potential for improvement.
PLI Schemes and China Plus One Strategy:
- PLI schemes and the China plus one strategy have boosted Indian manufacturing.
- Infrastructure modernization investments benefit companies in materials, real estate, and construction.
Bond Index Inclusion:
- FPIs have invested $14.4 billion in Indian debt, driven by anticipation of India’s inclusion in global bond indices.
- Inclusion in the JP Morgan EM Bond Fund and Bloomberg Bond Index is expected to bring in $25 billion.
Debt Flows:
- Debt inflows have grown steadily, contrasting with volatile equity investments.
- Rising US bond yields may moderate debt inflows in the future.
Cryptocurrency Mogul Sam Bankman-Fried Receives 25-Year Sentence for $8 Billion Fraud
Sam Bankman-Fried, the founder of the bankrupt cryptocurrency exchange FTX, was sentenced to 25 years in prison for stealing $8 billion from customers. The sentence marks the culmination of a dramatic downfall for the former billionaire, who was once hailed as a wunderkind in the crypto industry.
Key Points:
Sentence: – Sam Bankman-Fried was sentenced to 25 years in prison for fraud and conspiracy charges related to the collapse of FTX.
Judge’s Findings: – Judge Lewis Kaplan rejected Bankman-Fried’s claim that FTX customers did not lose money and accused him of lying during his trial testimony. – Kaplan found that FTX customers lost $8 billion, equity investors lost $1.7 billion, and lenders to Alameda Research lost $1.3 billion.
Bankman-Fried’s Apology: – Bankman-Fried acknowledged that FTX customers had suffered and apologized to his former colleagues.
Prosecution’s Request: – Federal prosecutors had sought a prison sentence of 40 to 50 years.
Defense’s Argument: – Bankman-Fried’s defense lawyer argued for a sentence of less than 5-1/4 years.
Bankman-Fried’s Testimony: – Bankman-Fried testified in his own defense, denying that he intended to defraud anyone or steal customers’ money.
Crypto Boom and Fall: – Bankman-Fried rode a boom in the values of bitcoin and other digital assets to a net worth of $26 billion before FTX’s collapse.
Political Contributions: – Bankman-Fried was a major contributor to Democratic candidates and political causes ahead of the 2022 U.S. midterm elections.
Customer Compensation: – Several FTX customers have expressed dismay that they will be compensated based on the value of their cryptocurrency at the time of FTX’s bankruptcy, rather than the higher levels at which those assets currently trade.
T+0 Settlement Beta Launch: Essential Information
India’s stock market is implementing a T+0 settlement system, where trades are settled on the same day. This is part of a global trend towards shorter settlement cycles. The system will initially be implemented as a ‘beta version’ with limited stocks and brokers. It is expected to improve liquidity and reduce funding requirements for brokers. However, institutional investors may face challenges due to currency risks and the need to bring in larger sums in advance.
Key Points:
What is the T+0 settlement? – Trades are settled on the same day (T+0). – Shares are transferred to the buyer’s account and funds are deposited in the seller’s account on the same day.
What is the ‘beta’ version of the shorter settlement cycle? – Pilot project where exchanges launch the system on an optional basis alongside the existing T+1 settlement cycle. – Only 25 stocks and a limited number of brokers can offer the facility. – Trading session for T+0 stocks is from 9:15 AM to 1:30 PM.
How does the new system help investors and traders? – Improves liquidity by making funds available on the same day of selling. – Allows traders to use cash better.
What does this mean for brokers? – Survival of the fittest for brokers servicing retail clients. – Brokers must manage finances and pass on benefits to clients. – Reduces working capital requirements.
What are the challenges that institutions will face in the shorter settlement cycle? – Institutional investors may need to bring in larger sums in advance, exposing them to currency risks. – Process involves intermediaries like custodian banks and foreign exchange banks.
How has the stock trade settlement cycle in India evolved? – T+5 (2002) -> T+3 (2003) -> T+2 (2021) -> T+1 (2023) -> T+0 (2024)
How are stock trades settled in the rest of the world? – Most markets still follow T+2. – US to shift to T+1 on May 28. – EU may follow suit. – China offers T+0 settlement.
Establishing a National Intelligence Hub for Manufacturing: Empowering India’s Industrial Revolution
The Indian government plans to establish a centralized intelligence unit to assess the country’s manufacturing capabilities and develop key performance indicators. This initiative aims to enhance the competitiveness of the manufacturing sector and increase its contribution to GDP. The unit will analyze domestic and global markets, study the impact of government schemes, and identify areas for improvement.
Key Points:
1. Centralized Intelligence Unit: – Will assess India’s manufacturing prowess and develop key performance indicators. – Will study the impact of government schemes aimed at boosting manufacturing.
2. Comprehensive Market Analysis: – Will identify products with high demand and growth potential. – Will conduct value chain analysis to understand products that can add value.
3. Study of Top 10 Manufacturing Nations: – Will analyze strategies and contributions of leading manufacturing countries.
4. Support for SCALE RAPiD Committee: – Will provide research and data intelligence to support the committee’s efforts to enhance local value-add and exports.
5. Evaluation of Export Potential: – Will identify products with global demand and provide inputs for foreign trade negotiations.
6. Comparison of Global Best Practices: – Will assess the feasibility of implementing global best practices in India.
7. Impact Assessment of Policies and Schemes: – Will evaluate the effectiveness of policies and schemes aimed at enhancing manufacturing competitiveness.
8. Identification of Areas for Reform: – Will identify areas where regulatory burden can be reduced to promote ease of doing business.
9. Assessment of Incentive Schemes: – Will consider the impact of tax breaks and access to credit in attracting investments in chosen sectors.
Revised Title: Rural Employment Scheme Wages Enhanced by 4-10%
Summary:
The Indian government has increased wages under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) by 4-10% for various states. The wage revision was approved by the Election Commission and announced by the Union rural development ministry. Goa has the highest wage rate increase, while Arunachal Pradesh and Nagaland have the lowest.
Key Points:
- Wage Revision: Wages under MGNREGS have been increased by 4-10% for different states.
- Highest Increase: Goa has the highest wage rate increase of Rs 34 to Rs 356 per day.
- Lowest Increase: Arunachal Pradesh and Nagaland have the lowest wage rate increase of 4% to Rs 234 per day.
- Highest Wage Rate: Haryana has the highest wage rate for unskilled workers at Rs 374 per day.
- Lowest Wage Rate: Arunachal Pradesh and Nagaland have the lowest wage rate at Rs 234 per day.
- Notable Increases: West Bengal (Rs 13), Tamil Nadu (Rs 25), Telangana (Rs 28), and Bihar (Rs 17).
- States with 10% Increase: Andhra Pradesh, Goa, Karnataka, and Telangana.
CBIC’s Standard Operating Procedure: Safeguarding Taxpayers from Harassment
The Central Board of Indirect Tax and Customs (CBIC) has issued a detailed Standard Operating Procedure (SOP) for officials of the Directorate General of GST Intelligence (DGGI) to improve the ease of doing business and prevent harassment of taxpayers. The SOP provides specific instructions regarding conduct during tax investigations, summons, and searches.
Key Points:
1. Zonal Unit Jurisdiction: – Officials must stick to GST cases within their zonal units for investigation.
2. Audit and Scrutiny Exclusion: – Investigations that fall under the ambit of audit and scrutiny should be skipped.
3. Specific Summons: – Summons must include specific details of the subject of enquiry and clear timelines. – Vague and piecemeal information requests should be submitted in writing.
4. Questioning and Searches: – Statements and outcomes of questioning and searches must be uploaded in the system within four working days.
5. Investigation Timeframe: – Investigations must be concluded within a year. – Show cause notices should not be delayed after investigation conclusion.
6. Multiple Notices: – When multiple investigating offices are involved, one office should pursue all subject matters related to the taxpayer.
7. Official Letters for Listed Companies and Government Entities: – DGGI must send official letters instead of summons to designated officers of listed companies, PSUs, corporations, or government departments.
8. Game-Changer for India Inc.: – The SOP is expected to stabilize and uniformize investigation approaches, providing a more predictable environment for businesses.
Government Announces Authorized Banks for Gold and Silver Importation in Fiscal Year 2025
The Reserve Bank of India (RBI) has authorized 11 banks, including HDFC Bank and ICICI Bank, to import gold and silver during the 2024-25 fiscal year. Additionally, three banks have been authorized to import only gold. Gold imports have increased significantly, while silver imports have declined during the current fiscal year.
Key Points:
- Authorized Banks for Gold and Silver Import:
- 11 banks authorized to import both gold and silver: HDFC Bank, ICICI Bank, etc.
- Authorized Banks for Gold Import Only:
- 3 banks authorized to import only gold: Indian Overseas Bank, Punjab National Bank, Union Bank of India
- Import Trends:
- Gold imports increased by 38.76% to USD 44 billion
- Silver imports decreased by 11.53% to USD 4.62 billion
Majority of Indian Firms Lack Cyber Threat Preparedness, Cisco Study Reveals
Cisco’s 2024 Cybersecurity Readiness Index reveals that only 4% of Indian organizations are adequately prepared to withstand modern cybersecurity threats. Globally, this figure stands at 3%. Despite increasing cybersecurity budgets, organizations face challenges due to complex security postures and a shortage of skilled professionals.
Key Points:
Cybersecurity Readiness: – 4% of Indian organizations are “mature” in cybersecurity readiness. – 37% are “progressive,” 52% are “formative,” and 7% are “beginners.”
Cybersecurity Threats: – 82% of respondents expect a cybersecurity incident to disrupt their business in the next 12-24 months. – Phishing, ransomware, supply chain, and social engineering attacks are common threats.
Security Posture: – 88% of respondents have multiple point solutions, slowing down incident detection and response. – 78% have deployed ten or more point solutions, with 38% having 30 or more.
Employee Access: – 92% of companies allow employees to access company platforms from unmanaged devices. – 48% of employees spend 20% of their time on company networks from unmanaged devices.
Talent Shortage: – 91% of companies cite talent shortage as a concern. – 59% have more than ten unfilled cybersecurity roles.
Future Cyber Investments: – 71% plan to upgrade IT infrastructure in the next 12-24 months. – 70% plan to upgrade existing solutions, 58% to deploy new solutions, and 60% to invest in AI-driven technologies.
SEBI Revokes Merchant Banking License of Karvy Investor Services
The Securities and Exchange Board of India (Sebi) has revoked the merchant banker registration of Karvy Investor Services Ltd (KISL) due to non-compliance with eligibility criteria. The decision follows an inspection that revealed the company lacked necessary infrastructure, employees, and a fit and proper director. Additionally, KISL had failed to pay its renewal fee.
Key Points:
- Breach of Eligibility Criteria:
- KISL lacked adequate office space, equipment, and experienced employees.
- The company’s director was involved in litigation related to the securities market.
- Lack of Infrastructure:
- KISL did not have a physical infrastructure or employees.
- Non-Payment of Renewal Fee:
- KISL failed to pay its renewal fee from December 2022 to December 2025.
- Previous Regulatory Action:
- In April 2023, Sebi barred KISL from taking new clients for violating regulatory norms.
Tejas Mark-1A Fighter Jet Embarks on Maiden Flight in Bengaluru
The first Tejas Mark-1A fighter aircraft successfully completed its maiden flight from HAL’s Bengaluru facility. The aircraft features advanced radar, electronic warfare systems, and improved combat capabilities. HAL aims to induct the Tejas Mark-1A into the Indian Air Force soon.
Key Points:
Tejas Mark-1A
- Maiden flight completed on Thursday, piloted by HAL’s chief test pilot
- Advanced radar, electronic warfare system, and communication system
- Additional combat capability and improved maintenance features
- Four to five major changes over the Mark-1 fighter, including AESA radar and digital map generator
- Integration of ASRAAM missiles and cockpit floor modification for improved pilot comfort
- Flight testing expected to take two years
Tejas Mark-2
- Development underway for a larger, more capable aircraft
- More powerful engine and increased maximum weight
- Canard added for enhanced control and agility
- Integration of new weapons, including Astra missiles and Rudram anti-radiation missile
- 11 hard points for carrying weapons and external stores
