Posts tagged All News
Govt to import 5,000 tonnes more of pulses to control prices (11-09-2015)
Indications of slower IIP growth for Aug (11-09-2015)
Forex reserves fall for second straight week (11-09-2015)
India’s foreign exchange reserves fell for the second straight week, reflecting the Reserve Bank of India’s intervention in the exchange market in the wake of the global turmoil since mid-August.
Reserves had fallen by $2.89 billion in the week ended September 4 to an outstanding $317.15 billion, data from the RBI showed.
This comes on the back of the biggest weekly fall of $3.4 billion in the previous week. In August, the rupee had weakened by 3.5% to fall past the key 66/$ level and hit a fresh two-year low on the back of a sharp fall in global equity markets and currencies.
On August 24, RBI governor Raghuram Rajan had said the central bank would not hesitate to use forex reserves to stabilise the rupee.
Part of the fall in the reserves could also be attributed to valuation changes given the sharp movement in the currencies globally. The RBI invests a large part of foreign currency assets in US treasury notes and the remaining in assets denominated in euro and other currencies. The dollar has gained phenomenally against most currencies, which could have resulted in a drag on the reserves.
Reserves had last fallen by $4.2 billion in the week ended May 31 in 2013 when foreign portfolio investors began exiting India in droves and the central bank had to intervene and sell dollars heavily.
The year saw the rupee hit an all-time low of 68.85/$ by August as FPIs pulled out record amount of dollars from the debt market. While the depreciation of the currency this time around has been similarly quick, it has been contained easily.
BJP loses Bengaluru Mayor slot to Congress-JD (S) combine (11-09-2015)
Bihar suffered after Nitish parted ways with BJP, says think tank (11-09-2015)
Congress indulging in negative politics, says Modi (11-09-2015)
Lenders to Amtek Auto form JLF with Rs 6,500 crore loans in limbo (11-09-2015)
Lenders to Amtek Auto have formed a joint lenders’ forum (JLF) to formulate a corrective action plan (CAP) for its Rs 6,500-crore term loans, sources told FE, adding that the JLF will also decide on the company’s request for extra funds of Rs 785 crore.
In March 2015, the company’s standalone gross debt stood at R7,844 crore, up from R7,036 crore in the same period last year. In three months to June 2015, it reported a net loss of R158 crore on the back of R866 crore in revenues. Its interest outgo stood at R237 crore in the same period.
The additional funding, lenders said, will allow the company to repay its bondholders, the date of redemption for which is September 20. Bankers said although the CAP for term loans is yet to be finalised, extending fresh credit to the company is almost certain.
“Out of the total R800 crore due for redemption on September 20, around R15 crore is to retail investors. The company is ready to pay the retail investors, but has sought fresh loans to repay institutional investors,” said a lender.
Investors include lenders like Axis Bank, Syndicate Bank and Corporation Bank. Other like IDBI Bank and Bank of Maharashtra have term loan exposures and have not invested in the bonds. Amtek Auto — part of the Amtek Group — is headquartered in New Delhi and is an integrated automotive component manufacturers in India.
The company has facilities in India, Europe and North America and manufactures components for auto as well as non-auto sectors such as the railways, specialty vehicles, aerospace, agricultural and heavy earth moving equipment.
Share of Amtek Auto rose as much as 75% in intraday trade on Friday on reports that the company may look to sell stake in overseas business to cut debt.
However, the scrip pared some gains to close 53.6% higher at R46.70 on the BSE. The company’s managing director, John Flintham, told a business news channel that they may look to sell stakes in overseas business to pare debt. “We have a debt-reduction programme,” Flintham told the channel. “We will sell minority stake in overseas businesses, which are profitable and owned 100% by Amtek Auto.”
Sales of non-core assets may fetch about $500-600 million, he said. The company’s overseas businesses earn $1.8 billion in revenue and their equity value is about $2 billion, Flintham told the channel, adding that it is planning to sell between 25% and 40% to raise as much as $600 million.
Amtek Auto’s troubles began when CARE Ratings suspended its credit rating last month. According to Bloomberg, this was followed by two Indian debt funds run by JPMorgan Chase & Co, which had invested in Amtek’s rupee bonds, to stem redemptions after a string of investors demanded their money back.