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Sebi eases norms for FPIs, startups; allows MFs to segregate distressed assets

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Mumbai: In a series of reforms, capital markets regulator Sebi eased norms for startup listings and allowed mutual funds to segregate distressed assets to safeguard investment returns.

At a meeting held here, the Sebi board also approved a proposal to expand the offer-for-sale mechanism for reduction of stake in listed companies and relaxed clubbing of investment limit norms for well-regulated foreign investors.

Besides, it cleared a proposal to allow custodial services in the commodity derivatives market to enable institutional participation.

 

With regard to listing of startups, the regulator has relaxed norms for new-age ventures in sectors like e-commerce, data analytics and biotechnology to raise funds and get their shares traded on stock exchanges.

Other measures included renaming the ‘Institutional Trading Platform’ that the regulator had created for such listings as ‘Innovators Growth Platform’.
The relaxation in norms follows tepid market response to the existing platform and demands from various stakeholders to make the rules easier and the platform more accessible in the wake of expanding activities in the Indian startup space.

“It (Institutional Trading Platform) has not taken off since 2015, we are aware of that, Sebi tried reviving it in 2016 also. But that time it couldn’t be done.

“Now this time since June-July we had a detailed discussion with the tech companies from Bangalore… We have tried to build in various features and we hope that it will be used for listing and also exit of funds which are in startups,” Sebi Chairman Ajay Tyagi told reporters here after the board meeting.

In another big move, the regulator has decided to allow mutual funds to create segregated portfolios with respect to debt and money market instruments in case of credit events while ensuring fair treatment to all unit holders.

Creation of segregated portfolios is a mechanism to separate distressed, illiquid and hard-to-value assets from other more liquid assets in a portfolio. It prevents the distressed assets from damaging the returns generated from more liquid and better-performing assets.

“We will see that this scheme is not misused,” Tyagi said.

The regulator also relaxed its norms for clubbing of investment limits for well-regulated foreign portfolio investors (FPIs).

As per Sebi, multiple entities having common ownership, directly or indirectly, of more than 50 percent would be treated as part of the same investor group and their investment limits would be clubbed.

However, clubbing of investment limits would not be applicable in case of entities having common control if the FPIs are appropriately regulated public retail funds.

The OFS norms will be eased to allow this mechanism for all companies with market cap of Rs 1,000 crore and above, as against the current limit of top 200 companies.

Also, if the seller fails to get sufficient demand from non-retail investors at or above the floor price on the first day of offer, then the seller may choose to cancel the officer post bidding in full (both retail and non-retail) on the first day itself and not proceed with the offer to retail investors on the second day.

Besides, the regulator said that an earlier proposed exercise for determining a uniform bond valuation methodology to be followed by all regulated entities across the financial sector would not be pursued.

Such an exercise was suggested by a working group on development of corporate bond market in India, chaired by H R Khan.

However, Sebi will prescribe high-level principles to be followed uniformly across all mutual funds for strengthening the existing system of valuation of corporate bonds for mutual funds.

Regarding the pricing agencies, the regulator has decided to evolve a supervisory and regulatory framework.

Also, housing finance companies and systemically important NBFCs may be exempted from disclosure of increase or decrease in shareholding due to encumbrance or release of the encumbrance of shares. A similar exemption already available to scheduled commercial banks and public financial institutions.


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US to eliminate Iran oil sanctions waiver for India, 7 others:Report

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Washington: The United States is expected to announce that all importers of Iranian oil will have to end their imports shortly or be subject to US sanctions, a source familiar with the situation told Reuters.

The source confirmed a report by a Washington Post columnist that the administration will terminate the sanctions waivers it had granted to some importers of Iranian oil late last year.

US President Donald Trump has been clear to his national security team over the last few weeks that he wants the waivers to end, and national security adviser John Bolton has been working the issue within the administration.

 

The US reimposed sanctions in November on exports of Iranian oil after Trump unilaterally pulled out of a 2015 nuclear accord between Iran and six world powers Washington is pressuring Iran to curtail its nuclear program and stop backing militant proxies across the Middle East.

Along with sanctions, Washington has also granted waivers to eight economies that had reduced their purchases of Iranian oil, allowing them to continue buying it without incurring sanctions for six more months

They were China, India, Japan, South Korea, Taiwan, Turkey, Italy and Greece.

But on Monday, Secretary of State Mike Pompeo will announce “that, as of May 2, the State Department will no longer grant sanctions waivers to any country that is currently importing Iranian crude or condensate,” the Post’s columnist Josh Rogin said in his report, citing two State Department officials that he did not name
Frank Fannon, US Assistant Secretary of State for Energy Resources, repeated the administration’s position that “Our goal is to get to zero Iranian exports as quickly as possible.

“Other countries have been watching to see whether the United States would continue the waivers. Last Tuesday, Turkish presidential spokesman Ibrahim Kalin said that Turkey expects the United States to extend a waiver granted to Ankara to continue oil purchases from Iran without violating US sanctions.

Turkey did not support US sanctions policy on Iran and did not think it would yield the desired result, Kalin told reporters in Washington.

Washington has a campaign of ‘maximum economic pressure’ on Iran and through sanctions, it eventually aims to halt Iranian oil exports and thereby choke Tehran’s main source of revenue.

So far in April, Iranian exports were averaging below 1 million barrels per day (bpd), according to Refinitiv Eikon data and two other companies that track such exports and declined to be identified.

That is lower than at least 1.1 million bpd as estimated for March, and down from more than 2.5 million bpd before sanctions were reimposed last May. Brent crude futures , the international oil benchmark, were up nearly 2 per cent at USD 73.25 a barrel, on the report that the waivers were to end.

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Maruti drives in Baleno with BS VI compliant petrol engine

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New Delhi: The country’s largest carmaker Maruti Suzuki India (MSI) Said it has launched its premium hatchback Baleno with BS VI emission norms compliant petrol engine, priced between Rs 5.58 lakh and Rs 8.9 lakh (ex-showroom Delhi).

The auto major has also introduced two variants of the car with smart hybrid technology. The trim with 1.2 litre DUALJET, DUAL VVT petrol engine is priced at Rs 7.25 lakh, while the Zeta variant is tagged at Rs 7.86 lakh. As per the company, the models with smart hybrid technology would deliver a fuel efficiency of 23.87 km/litre.

“At Maruti Suzuki, we strive to bring newer, better and environment friendly technologies to our products. Baleno Smart Hybrid with BS VI stands testament to the same. We are confident that the premium hatchback Baleno will present a complete package in line with aspirations of evolving customers,” MSI Senior Executive Director Marketing & Sales R S Kalsi said in a statement.

 

The company said in order to achieve the stringent emission regulation requirement, it has upgraded both engine hardware and software along with exhaust system.”Baleno is country’s first premium hatchback to be offered with Smart Hybrid technology,” it added.

MSI has sold over 5.5 lakh Baleno units since its launch in 2015. It sold more than 2 lakh units of the hatchback in the last fiscal year.

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SpiceJet, Emirates sign MoU for code share partnership

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Mumbai: Budget carrier Spicejet announced signing of an initial pact for code share partnership with Gulf carrier Emirates.

The reciprocal partnership will allow opening of new routes and destinations for passengers of the two airlines, SpiceJet said in a statement.

“I am delighted to announce that as part of SpiceJet’s international expansion strategy, we have signed a Memorandum of Understanding (MoU) for a code share agreement,” SpiceJet Chairman and Managing Director Ajay Singh said in the statement.

 

SpiceJet passengers from 51 domestic destinations will be able to access Emirates’ network across the US, Europe, Africa and Middle East, it added.

Code-sharing allows an airline to book its passengers on its partner carriers and provide seamless travel to destinations where it has no presence.

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