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NPA resolution may get 180 days more

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New Delhi: The government is considering a proposal to extend the time limit for bankruptcy resolution process by 180 days over and above the initial 180 days under the Insolvency and Bankruptcy Code (IBC). The Centre feels the current timeline is proving insufficient to arrive at a resolution.

The finance ministry is also suggesting that 75 per cent of bankers agreeing to a resolution — at present it is 100 per cent — is enough for passing the resolution in the committee of creditors (CoC). So, effectively the ministry is calling for a CoC voting cap.

The main purpose is quickening the process and go for the right kind of value creation. The changes being proposed will definitely help corporates, bankers and everybody else involved, said sources.

 

The current law allows a maximum 270 days for resolution — an initial 180 days and 90 days of extra time on top of that. Top finance ministry officials said this period might be further relaxed by 180 days. So, it will be 180 days for the resolution process and another 180 days to be awarded by the National Company Law Tribunal (NCLT) subject to the proceedings of the case. In short, if changes are incorporated, it will be a full year for any resolution of NPA.

Meanwhile, ministry of corporate affairs is reviewing the changes in the IBC. These new changes if incorporated will give NCLT the power to extend insolvency resolution by 180 more days. The finance ministry will send its proposals to MCA for incorporation after detail discussions.

Officials said after the Reserve Bank of India (RBI) scrapped many debt resolution mechanisms such as strategic debt resolution (SDR), corporate debt resolution (CDR) and Scheme for Sustainable Structuring of Stressed Assets (S4A), there is stress on the NCLT and banks under the current timeline. The RBI said accounts with aggregate debt of more than Rs 2,000 crore will have to be taken to NCLT within 15 days if a resolution plan does not bear fruit in 180 days.
The RBI requires banks to implement a resolution plan within 180 days and in case of non-implementation, lenders are required to file an insolvency application. The RBI’s latest data shows that the public sector banks could recover a total of only Rs 15,786 crore in 2016-17 and 2017-18 till December 31 through all recovery channels, including IBC.

The total NPA of PSBs stands at Rs 8 lakh crore. The RBI has prepared three lists of defaulters who are in NCLT for resolutions. Not a single big case has been resolved so far.

In fact, in the last four fiscals — 2014-15, 2015-16, 2016-17 and 2017-18 till December 31 — all 21 public sector banks in aggregate could recover only Rs 29,343 crore out of Rs 2.72 lakh crore of bad loans, as per the RBI data.


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Sensex sheds 298.82 to close at 38,811; Nifty shrinks to 11,650

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Mumbai: The benchmark BSE Sensex erased early gains to end 299 points lower Thursday as investors booked profits after stocks soared to record highs after BJP’s strong showing in the Lok Sabha polls.

Sensex and NSE Nifty went on to record highs even as Lok Sabha election results showed that PM Modi-led NDA leading on over 300 seats. However after the euphoria during the morning session, Sensex shed 298.82 to close at 38,811 and Nifty shrank to 11,650 on the closing bell.

During the day, the Sensex hit the 40,000 mark while the Nifty crossed the 12,000-level for the first time ever. However, the indices succumbed to profit booking towards the fag-end of the session.

 

The 30-share Sensex tumbled 298.82 points, or 0.76 per cent, to close at 38,811.39. Similarly, the broader NSE Nifty settled 80.85 points, or 0.69 per cent, lower at 11,657.05.

IndusInd Bank was the biggest gainer in the Sensex pack, rallying 5.23 per cent, followed by Hero MotoCorp, Coal India, Yes Bank, PowerGrid, ICICI Bank, HCL Tech, L&T, Kotak Bank and Bharti Airtel, rising up to 1.56 per cent. On the other hand, Vedanta, ITC, Tata Motors, HDFC twins, Bajaj Finance, Sun Pharma, Tata Steel, TCS, ONGC and Infosys fell up to 5.53 per cent.

Riding on a massive Modi wave sweeping through most parts of India, the BJP was set to return to power Thursday as it led in 298 seats while the Congress trailed far behind with 52, according to trends released by the Election Commission for all 542 seats that went to polls.

“Markets were initially enthused to see the election results falling in line with the exit polls. However, the run up to the D-day was so sharp that it turned out to be a sell on news phenomenon,” said Devang Mehta, Head – Equity Advisory, Centrum Wealth Management.

Participants would now be keen to know the future course of action for bringing the economy back on track, solution to the liquidity situation, the union budget, onset and progress of monsoon in June and most importantly the earnings trajectory, he added.

According to traders, weak cues from other global markets and a depreciating rupee also weighed on investor sentiment. The rupee depreciated 37 paise to 70.04 against the US dollar in afternoon trade. Globally, bourses in Asia ended in the red.

Indices in Europe were also trading on a negative note in early deals. Brent crude, the global oil benchmark, was trading 1.79 per cent lower at USD 69.72 per barrel.

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Silver up on increased offtake; gold steady

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New Delhi: Silver prices rallied by Rs 200 to Rs 37,400 per kg in the national capital on Thursday, while gold held steady, according to the All India Sarafa Association.

Traders said silver prices rose on pick-up in offtake by industrial units and coin makers at the local spot market. Globally, spot gold was trading marginally higher at USD 1,276 an ounce, while silver was slightly up at USD 14.53 an ounce in New York.

In the national capital, gold of 99.9 per cent and 99.5 per cent purity dropped by Rs 10 each to Rs 32,670 per ten 10 gram and Rs 32,500 per 10 gram. Sovereign gold, however, held steady at Rs 26,500 per eight gram.

 

Silver ready surged Rs 200 to Rs 37,400 per kg, while weekly-based delivery fell by Rs 66 to Rs 36,234 per kg. Silver coins held flat at Rs 79,000 for buying and Rs 80,000 for selling of 100 pieces.

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India PC mkt declines 8.3 per cent to 2.15 mn units in Jan-Mar qarter

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New Delhi: Personal Computer (PC) shipment in India fell by 8.3 per cent in the January-March quarter of 2019 to 2.15 million units, registering a year-on-year decline for the third consecutive quarter, according to research firm International Data Corporation (IDC).

Besides, big commercial deals, market remained weak due to weak consumer demand, high inventory from previous quarters, and supply issues for Intel chips.

Shipments in the consumer segment saw a 26.5 per cent dip in the said quarter compared to the year-ago period. The commercial PC market saw a total shipment of 1.35 million units in the said quarter, a growth of 7.3 per cent over last year.

 

“The announcement of central elections on March 10, 2019 resulted in the model code of conduct coming into immediate effect further resulting in a delay in execution of government projects and impacting the commercial segment,” IDC said in a statement.

However, IDC expects the overall PC market in India to witness a growth in the second quarter. The commercial market is expected to pick up post new government formation in May, while the consumer market is expected to pick up largely driven by back to school campaign by vendors and online sales.

HP maintained its leadership position with an overall market share of 28.1 per cent in the first quarter of 2019, followed by Dell (25.9 per cent), Lenovo (25.2 per cent) and Acer (11.7 per cent).

The notebook PC (laptop) category accounted for 61.4 per cent of the shipment and witnessed a 9.8 per cent year-on-year decline.

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