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Maruti Q1 net dips 23% in fourth quarterly loss in a row
Barclays, RBS, UBS seen central to Libor rigging scam
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Investment Guidance
Educomp Solutions pays off all FCCBs
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Maruti Q1 net dips 23% in fourth quarterly loss in a row
New Delhi, July 28 Maruti Suzuki, 54.2 percent owned by Japan's Suzuki Motor Corporation, said net profit fell to Rs 4.24 billion for the three months to June from Rs 5.49 billion a year earlier. "Adverse currency movements, notably the yen-rupee exchange rate, impacted profits negatively," Maruti Suzuki, which imports many components from Japan, said in a statement. The auto major’s net sales for the quarter rose 27.5 percent to Rs 105.3 billion from a year earlier. Analysts expected a net profit of Rs 4.85 billion for the quarter on revenue of Rs 101.10 billion, according to Thomson Reuters I/B/E/S. Maruti faces months of supply woes and a slump in market share and sales as a lockout at a key factory enters its second week after violent clashes between workers and management left one company official dead. The shutdown at the company’s Manesar plant near Gurgaon in Haryana in threatens a replay of a dismal 2011 when labour unrest battered the company's sales, market share and profit. The results released on Saturday are for the three months to end-June, and as such are not affected by the shutdown. The latest labour problems add to Maruti Suzuki's woes at a time when it is fighting an industry-wide slowdown in sales as the Indian economy grows at its slowest pace in nine years, while a weakening rupee has made it even worse for an industry that depends on imports for key raw materials. Maruti Suzuki shares, valued at $5.8 billion, are down more than 9 percent since it announced the shutdown of the Manesar plant on July 18. The stock closed 0.4 percent higher on Friday, underperforming a 1.1 percent rise in the broader market. — Reuters
Gujarat plant construction soon
Ahmedabad: Maruti Suzuki, could begin construction of its proposed manufacturing unit in Mandal taluka near here within the next three months, a top state official said Saturday. Gujarat Chief Minister Narendra Modi recently met Suzuki Motor chairman & CEO Osamu Suzuki during his Japan tour. "Chairman of Suzuki has said they will start the work on setting up car manufacturing plant at Mandal soon, and assured that a large number of vendor units would also come up there," state's Principal Secretary (Industries) Maheshwar Sahu said.
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Barclays, RBS, UBS seen central to Libor rigging scam
New York/London, July 28 Some of those traders, including one who used to work at Barclays Plc in New York, still have senior positions on Wall Street trading desks. Until now, most of the attention has involved traders at Barclays, which last month reached a $453 million settlement with U.S. and UK authorities for its role in the manipulation of rates. Now, it is becoming clear that traders from at least two other banks — UK-based Royal Bank of Scotland Group Plc and Switzerland's UBS AG — played a central role. Between them, the three banks employed more than a dozen traders who sought to influence rates in either dollar, euro or yen rates. Some of the traders who are being probed have worked for several banks under scrutiny, raising the possibility that the rate fixing became more ingrained as traders changed jobs. The documents reviewed by Reuters in analyzing the traders' role included court filings by Canadian regulators who have been investigating potential antitrust issues; settlement documents with Barclays filed by the US Justice Department and the US Commodity Futures Trading Commission and by the UK Financial Services Authority; and a private employment lawsuit filed by a former RBS trader in a Singapore court. — Reuters
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Capital gains tax liability on sale of gifted shares
By A.N. Shanbhag Q: I've sold a property after holding it for two years. The net short-term capital gain on the sale is Rs 8 lakh. My father bought shares worth Rs 10 lakh a couple of months ago, but their value has eroded and they are currently worth only Rs 4 lakh. If he sells them today the loss will be Rs 6 lakh. If, instead of my father selling them, I request him to gift those shares to me and I sell them at Rs 4 lakh, will I incur a short-term loss of Rs 6 lakh? I want to adjust the short-term capital gain from selling the property which was registered in my name against the short-term capital loss that I would incur from selling the giftet shares. — Amit A: There will be no tax incidence on either party arising from the gift of shares by your father to you. Moreover, when you sell such gifted shares, the cost and the holding period of the previous owner (your father) would be taken as your cost and the holding period, respectively. And since short-term capital gains can be set off against short-term capital loss, the strategy you have outlined in your query is sound in line with the income tax laws. However, an income tax officer may raise an objection that this arrangement was essentially undertaken to evade tax. While you can argue your case through the means of an appeal, it would be advisable to undertake such an action only if the tax saving potential is substantial. In other words, the means should justify the end. Q: After the death of my grandfather, who held a PPF account, what formalities need to be completed by his minor grandson, who is his nominee? The name of the person appointed on behalf of the latter by the deceased is his father. — Sukhman A: All you have to do is to approach the account office (bank) maintaining the PPF account and submit the account holder's death certificate. The bank will then advise you regarding the procedural formalities. Generally, the nominee has to submit a letter to the bank declaring he is a nominee and submit an ID proof to support the claim. In this case, the minor will have to be accompanied with the guardian who will have to submit the proofs required.
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Educomp Solutions pays off all FCCBs
New Delhi, July 28 The package includes an amount of $70 million as external commercial borrowings (ECBs) comprising $30 million from IFC, a member of the World Bank Group and $40 million from Proparco, a French development financial institution. It also includes $50 million as equity comprising about $15 million from IFC, $5 million from Proparco and $ 30 million from funds managed by Mount Kellett Capital Management at the price of Rs 149.16 per share (a premium of 10% to the floor price as per SEBI formula). The promoter group has also brought in $25 million comprising $15 million of equity and $10 million of equity warrants, at a price of Rs 193.74 per share. Educomp said the long-term nature of the debt improves the asset-liability profile of its balance sheet and will help it realize significant value from its investments in its core businesses such as K12 among others. Using these funds, the firm has since paid off its outstanding FCCBs in full (including $78.5 million outstanding principal and redemption premium of approx.ly $32.25 million) on the due date.
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Maruti Suzuki, India's biggest carmaker, lagged estimates with a 23 percent fall in fiscal first-quarter profit, its fourth consecutive quarterly profit decline, as a weak local rupee currency pushed up costs.
Maruti Suzuki, 54.2 percent owned by Japan's Suzuki Motor Corporation, said net profit fell to Rs 4.24 billion for the three months to June from Rs 5.49 billion a year earlier.
