Empower 22 November 2013

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P WEREM22 NOVEMBER 2013Volume 2, Issue 46

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OAN E-WEEKLY FROM THE WESTERN INDIA REGIONAL COUNCIL OF

THE INSTITUTE OF COMPANY SECRETARIES OF INDIA

www.freepressjournal.in


The Supreme Court on Thursdaybarred Sahara group from selling or‘parting with’ any of its properties

d restrained the group's head Subrata Royhara and three group company directorsm leaving India.

The apex court's fiat followed Sahara's fail-e to comply with the October 28 ordersat had asked it to furnish original titleeds of unencumbered properties worth atst Rs.200 bn to SEBI within three weeks toable the market regulator to examine

hether the properties can be kept with ank as security for the debentures money.

ahara had submitted it 106 acre Versova,umbai property, claiming it to be worth0 bln rupees, and another set of properties

orth another Rs.10 bn. SEBI, however, saide valuation report of the properties wast of the land but its "investment values".

Though Sahara counsel claimed that Varso-va was a prime property near the sea in theproperty-starved city, SEBI said that, as perthe valuation report submitted by Sahara,the land could potentially be worth Rs,190bn if a township, flats and villas are devel-oped and sold by 2021.

This was in violation of the apex court's Oct28 order asking the Sahara group to deposittitle deeds of properties worth 200 bln ru-pees, SEBI said. To top it up, SEBI counsel toldthe court that Sahara did not disclose to thecourt that the land fell in a "no developmentzone" as per a Ministry of Environment and

Forests notification and that is why it was ly-ing idle for years. SEBI said the land wasworth only Rs.1.18 bn as per thedocuments.

SOURCE: Free Press Journal

The Reserve Bank on Thursdayfavoured liberalisation of bank licensing policies which other-

se could hinder entrance of newayers and have an adverse impact one economy and consumers.Regulators need to ensure that their

gulatory stance does not create barri-s to the entry or exit of institutions orsult in unwarranted costs to theonomy and consumers,” the RBI saidits annual ‘Trends and Progress of nking in 2012-13’ report.Instead regulation should impose re-ictions on institutions is such a wayat it does not cause a moral hazardoblem,” the report said. The centralnk is in the process of issuing newnking licenses. It has received asany as 26 applications for bank li-nces on the close on July 1.

The RBI is likely to issue new banking

ences in January 2014. The RBI saidne of it's discussion papers favoursontinuous authorisations' of new

nks and explores the possibility of nverting large urban co-operativenks into commercials banks to im-

part dynamism to the banking system."However, this is not to undermine

the need for ensuring sufficiently strin-gent entry norms to prevent the entryof banks of questionable soundness or

competence, since their proliferationscould undermine public confidence of the overall integrity of the banking sys-tem," the RBI said.

Tata Group and firms controlled bybillionaires Anil Ambani and Kumar

Mangalam Birla are among thosewhich applied for bank licences.

Among public sector units, India Post,LIC Fome Finance and IFCI have sub-mitted applications. Microfinance insti-

tutions such as Bandhan Financial Serv-ices and Janalakshmi Financial, too,have expressed their intention to set upbanks.

The RBI had issued guidelines for newbanks on February 22 and came out

with clarifications in the first week of June.

In the past 20 years, the RBI has is-sued licence to 12 banks in the privatesector in two phases. Ten banks were li-censed on the basis of guidelines is-sued in January 1993 and two in the

second phase. The guidelines were re-vised in January 2001 based on the ex-perience gained from the functioningof these banks and fresh applicationswere invited.

Asset quality The central bank said that the stress

on banks' asset quality remains a majorchallenge inthe short-term and issuesconcerning the same will get priorityattention of the RBI.

A rise in the banks' asset impairmentcoupled with a dip in profitabilitywasseen in the period under consideration,as adverse international economicde-

velopments combined with the loss of growth momentum in the domestice-conomy posed challenges to the bank-ing sector.


RBI for easing regulatory moral hazards,worried about banks’ asset quality

SC bars Sahara from sellingproperty, Roy from leaving India

Low credit growth slowed bk balancesheet growth 2012-13

PSU banks' share rising but assetconcentration still low

PSU bks need extra 4.15 trln rupeecapital till Mar 2018

Need to cut gilt invest needs of banksin calibrated way

New norms may allow banks to accrueprovisioning buffer

KEY HIGHLIGHTS

Amid market woes, FM promotesIndia as investment destination

Seeking investment in infra-structure and capital mar-kets, Finance Minister P Chi-

dambaram today emphasised thatIndia is a safe destination with apotential of 8 per cent growth andproviding comparable returns.

"The macro-economic funda-mentals and the micro-economicfundamentals make India an at-tractive and safe investment desti-nation," he said while addressingthe second South Asian Diasporaconvention here. The government,Chidambaram said, has taken anumber of measures to stabilisethe economy and give greater con-fidence to investors.

"India can offer to the investor avariety of investment opportuni-ties. There are Government securi-ties and corporate bonds. There aremutual funds and InfrastructureDevelopment Funds. We can offerequity in our public sector enter-

prises that are under the disinvest-ment programme.

"There is a clutch of projects in

the oil and gas sector that will wel-come strategic investors. Shortly,we will offer a public sector ETFthat will allow you to buy unitsbacked by underlying equityshares," he said at the conventionattended by over 1000 delegates.

Referring to growth, Chi-dambaram said India has a poten-tial growth rate of 8 per cent andabove and during the 20 year peri-od between 1991-2011, the averagegrowth rate was 7 per cent. Notingthat the key to sustaining highgrowth rate is investment, the Min-

ister said the government will en-deavour to contain fiscal deficit tobelow 3 per cent of the GDP, safelyfinance the Current Account Deficitand keep inflation under 5%.




2 P WEREM O

The country's largest softwareservices firm Tata ConsultancyServices (TCS) has said it ex-

ects to give out offers to hire 25,000eople via campus hiring next year byebruary."As far as our trainee or campus hiringconcerned you are aware that we dofrom seventh semester onwards, ande have started that exercise- we have

aid that we will be giving offers to5,000 people/students,the process isready on," TCS EVP & Global Head, Hu-an Resources Ajoy Mukherjee told re-

orters here."We will be completing that exerciseJanuary or early February, at this

age we are going to various institutesnd doing our campus hiring," hedded.It is expected that students will comen board by July. The TCS HR head said:As far as this year is concerned- initiallyhen we started with we said we wille doing with 45,000 as the total hiringhich includes trainees...., then we re-sed and said that we will do 5,000ore- so totally we said that we will be

0,000, that's what we did at the end of

he last quarter.""As far as hiring target is concerned it50,000 and we are pretty much onack as far as that number goes and weill do the review again to see that we

hould increase it or not," he added.Stating that off campus placementould be primarily for freshers, Mukher-e said "....given the environment to-ay where the number of organisations

hat are visiting various campuses haveome down, and the offers are not tooany- so can we look at a way where inwe are not visiting but there can beright candidates who have not got an

pportunity. That is what we are look-g at."

SOURCE: PTI


B

osses,

pleasenote! Al-lowing your em-ployees to havefun at work mayencourage themto stick around forlonger, a newstudy suggests.

Within the hos-pitality industry,manager supportfor fun is instru-mental in reduc-ing employee

turnover - the rate at which a companygains and loses employees - particular-ly for younger employees, researcherssaid.

However, manager support for funalso reduces employee productivity,which can negatively impact sales per-formance.

"High employee turnover is consis-tently quoted as being one of the prob-lems that keeps managers up at nightbecause if you're involved with recruit-ing and training constantly, then youcan't focus on effectively managingyour existing staff and providing a

high-quality service experience," saidMichael J Tews, assistant professor of hospitality management, Penn State.

The team - which included re-searchers at Penn State, Loyola Univer-sity of Maryland and Ohio State Univer-sity - surveyed 195 restaurant serversfrom a casual-theme restaurant chainin the US.

The survey included items related todifferent aspects of fun at work, includ-ing "fun activities" and "manager sup-port for fun." The researchers thencompared the survey responses tosales performance and turnover data.

In the survey, questions related to "funactivities" focused on social events, suchas holiday parties and picnics; team-building activities, such as company-

sponsored athletic teams; competitions,such as sales contests; public celebra-tions of work achievements; and recog-nition of personal milestones, such asbirthdays and weddings.

The research yielded three key find-ings. First, manager support for fun low-ers employee turnover, particularlyamong younger employees.

Second, fun activities increase salesperformance, particularly among olderemployees.

Third, manager support for fun lowerssales performance irrespective of age.

"The question becomes, is the produc-

tivity loss associated with manager sup-port for fun worth the significant reduc-tion in employee turnover?" Tews said.

"We think if you have both managersupport for fun and fun activities, the dipyou see in productivity as a result of manager support for fun may be can-celled out by the increase in productivityyou see as a result of fun activities. In thisscenario, you also see the greatest re-duction in employee turnover," Tewssaid.

"The take-home message is that funcan work, but it's not a panacea," Tewssaid.

The study appears in Cornell Hospitali-ty Quarterly.

SOURCE: PTI

Market regulator Sebi todayfinalised 75 applicants forthe officer level job as

part of its plan to beef up its head-count for faster and more effective ex-ecution of newly granted powers.

The Securities and Exchange Boardof India (Sebi) said that these "appoint-ments are subject to satisfying the agelimit, educational qualification alongwith minimum marks (as required) andother eligibility criteria."

Sebi has embarked upon a major re-

cruitment drive to carry out its newlygranted powers and expanded role toregulate various segments of capitalmarkets, while safeguarding the inter-est of investors from fraudsters andother manipulators

Earlier, Sebi has short-listed only 247candidates for a personal interviewfrom the several thousands of appli-cants that appeared for a written testheld in September. However, only 75got selected for the post.

The job call for 75 officers, whowould be offered an annual pay pack-age of about Rs 11 lakh, generated

huge demand and nearly one lakh ap-plications were received by Sebi fromthe interested candidates.

In the first phase of this hiring drive,Sebi plans to hire 75 officers, while theregulator plans to conduct more re-cruitment exercises going ahead.

Sebi is looking to increase its head-count from about 600 currently toclose to 1,000.

The recruitment drive began soon af-ter the government decided to grantgreater execution powers and a largeroversight role against potential invest-ment fraud that would require Sebi to

have a much larger workforce.Besides, the capital market regulator

is opening local offices on a pan-Indiabasis for enhanced investor awarenessand services that require additionalmanpower.

An independent consultant recentlysuggested Sebi increase its workforceto about 1,000 employees in order tomeet future manpower requirementsto take full ownership of regulatoryoversight of all investment schemesbesides staff requirement in regionaloffices as well as local offices.

The staff strength also needs to be

enhanced to meet its future role andfunctions, said the consultant whichwas hired to suggest ways for an over-haul of Sebi's role, vision and functions.

SOURCE: PTI

Fun at work promotesemployee retention: Study

IIndia's leading staffing firmshave generated over 5 million jobs in the last 10 years, accord-

g to Indian Staffing Federation

F).SF is an apex body of flexi-staffingdustry in India. "The flexibleaffing industry has now and againoven itself as one of the key pillarscessary to sustain and accelerate

the growth of the Indian economy,"ISF Vice President RituparnaChakraborty said.

Flexible staffing is making its way

into the formal sector. Out of twocrore flexi-staff in India, only 13 lakhare being covered under the organ-ised sector.

According to a study conducted byNational Sample Survey Organisation

(NSSO), employment rates have fallenslightly for both men and women,but it has been somewhat sharper forwomen, falling to 22 per cent in FY'12

from 29 per cent in FY'05. This ambiguity in the Indian labour

market has increased the demand forflexi-staffing industry, ISF added.

SOURCE: PTI

Staffing firms create over 5 million jobs inast 10 years: Indian Staffing Federation

TCS to give outcampus offers

to 25,000 peopleby Februarynext year

Sebi to increaseheadcount;finalises 75

applicants for

officer level job



P WEREM O 3


T

he Empowered Group of Min-

isters on spectrum endorsedthe Telecom Commission'soposal on reserve price for the800 Mhz and 900 Mhz GSM band-idth, making the reserve priceghtly more expensive from whate sector regulator had recommend-

d.Telecom Commission on Nov 6 hadoposed up to 25% hike in the Tele-

om Regulatory Authority of India-commended spectrum reserveice in 1,800 Mhz and 900 Mhz band-idth.The decision by the ministerial pan-

headed by Finance Minister P. Chi-ambaram will entail that the pan-In-a reserve price for spectrum in the800 Mhz bandwidth per Mhz stands17.20 bln rupees, up from 14.96 blnpees recommended by TRAI on Sep

The ministers' group endorsed bothRAI's and Telecom Commission'soposal that there should be noservation for the 900 Mhz band, en-iling that operators such as Bhartirtel and Vodafone India will have to

acate their 900 Mhz spectrum wheneir licences in Delhi, Mumbai and

olkataexpire in November 2014.

Reserve price for spectrum in Delhicircle in the 1,800 Mhz will be at 2.18bln rupees per Mhz, while for Mumbaithe reserve price would be at 2.06 blnrupees per Mhz.

Base price for Delhi circle in the 900Mhz bandwidth will be at 3.60 bln ru-pees per Mhz, while that for the Mum-bai circle will be at 3.27 bln rupees.For the 800 Mhz bandwidth, the min-isters' panel decided that TRAI's viewwill be sought in respect to the pric-ing for the CDMA bandwidth.

The sector regulator had recom-mended that the auction of the 800

Mhz band should not be held as of now because the government is likely

to get lower revenues from the sale of the bandwidth, given the currentlylow demand for CDMA services in thecountry.

"We will inform the Cabinet, becauseit is the Empowered Group of Minis-ters. We have the power to decide,"Sibal said at the conclusion of today'smeeting. Sibal stated that the auctionfor the 800 Mhz bandwidth will beheld separately with the auction forGSM spectrum 1,800 Mhz and 900Mhz, scheduled to be held earlier inJanuary.

The ministerial panel decided that

further discussion would be held onthe issue of spectrum usage charge

on account of the complexity in-volved, and would take a decision be-fore the commencement of the auc-tions. TRAI had recommended thatthe spectrum usage charges, which isa percentage of the annual adjustedgross revenues of the companies paidto the government, should be leviedat uniform 3%.

Currently, companies pay spectrumusage charges in the range of 1-8%based on the quantum of spectrumheld by them. The Commission haddecided that a detailed consultation

with the finance ministry will be heldbefore a decision is taken. Any changein the spectrum usage charges couldinvite litigations from companies as itwould lead to changes in the licenceconditions.

Sibal said the government expectsto garner about 300-400 bln rupeesfrom the spectrum sale and from one-time spectrum usage charges.

The Finance Ministry has set a targetof 400 bln rupees from spectrum rev-enues in the current financial year2013-14 (Apr-Mar).


Spectrum auction: EGoMslightly hikes reserve price

T

he petroleum ministry willseek the Cabinet's approval

for providing a floor and ceil-g for the price of domestic naturals under the new gas pricing policyproved by the Cabinet earlier thisar, a senior ministry official told Co-ncis.The finance ministry wanted a capd floor price for gas to prevent do-estic prices from being extremelylatile due to global conditions. Soat is also a part of our note," the of-ial said.

The proposals are a part of the draftbinet note in which the petroleumnistry is seeking clarity on whether

ukesh Ambani-led Reliance Indus-es should be denied any advan-ge of the new gas price policy tille shortfall from its D6 block in theshna Godavari basin is met. Thetroleum ministry, in its revised

Cabinet note, has proposed that Re-liance Industries submit a bank guar-

antee until a resolution is reached onthe issue.

"The company will have to submitbank guarantee each quarter and incase the decision is that the pricingof the KG-D6 should be capped untilthe operator does not meet theshortfall, then the bank guaranteewill be encashed," the official said. InJune, Cabinet Committee on Eco-nomic Affairs approved the recom-mendations of the petroleum min-istry, based on the formula given by apanel headed by Prime Minister'sEconomic Advisory Council Chair-

man C. Rangarajan that favoured ahike in rates.

The new policy, named Natural GasPricing Guidelines, 2013 that will re-main valid for five years, envisagescalculating prices of domestically

produced natural gas at an averageof international hub prices and cost

of imported liquefied natural gas, ex-cluding spot liquefied natural gasprices, instead of the present mecha-nism of market discovery with minormodifications.

"We had announced that spotprices would be excluded but thenwe decided to include that. So wewant Cabinet approval for the finalpricing formula as well," the officialsaid. An increase in gas prices will sig-nificantly boost revenues andprofits of upstream companies--es-pecially Oil and Natural Gas Corp Ltdand Oil India Ltd. It may also lead to

an increase in exploration activitiesand higher production in the longrun.

SOURCE: Free PressJournal

OIL MIN MAY SEEK CABINETNOD FOR CAP ON GAS PRICE

After getting a good response tothe double forex swap windowsaimed to shore up forex buffer

and prop up the rupee, the RBI today al-lowed banks to utilise the special windowtill December 31 to borrow forex againsttheir core capital but with riders.

The other swap window was to draw inNRI funds through the FCNR-B depositroute. Both the windows till Wednesdayhad netted in USD 22.5 billion and are tobe tapered off on November 30.

Under the facility, banks were permittedto borrow from international banks/multi-lateral agencies up to 100 per cent of their

core capital and swap the amount withthe Reserve Bank at a concessional rate of 3.5%.


RBI extends

bank’s spl forex

window till Dec 31

with riders

The move will entail that pan-Indiaeserve price for spectrum in the1,800 Mhz bandwidth per Mhzstands at Rs 17.20 bln, up froms 14.96 bln as suggested by TRAI

EGoM OKs telecom panel proposals on1,800 Mhz, 900 Mhz band

TRAI to give recommendations on800 Mhz auction pricing

Spectrum auction to take place in Jan

Telecom M&A guidelines not discussedin EGoM meet today

No reservation for any operator for 900 Mhz spectrum

No decision taken on spectrum use charge, EGoM to mull more

Hope to get 300-400 bln rupees from spectrum, one-time fee

Want all spectrum in 1800 Mhz band to be auctioned

RINGS THECHANGES



P WEREM O4


The Higher EducationForum (HEF) is thelargest on-line commu-nity of academic andrelated individuals striv-ing towards excellence

in higher education.

www.higehreduforum.org

The Free Press Journal is an 85-year-oldnewspaper based in Mumbai.

EM OB-School Edition Powered By

747.75 4.58 32.75

2525.5 5 4.3 8 1 05.90

562.05 3.71 20.10

996.25 3.71 35.65

1049.0 5 3.64 36 .80

45.05 -3.22 -1.50

101.55 -3.10 -3.25

157.95 -2.83 -4.60

174.35 -2.79 -5.00

344.55 -2.75 -9.75

Name LTP % Change Name LTP % Change MARKETS

Stock Watch

BSE: 20,217.39 22.99

NIFTY: 5,995.45 5.85

CAC40: 4,278.53 13.70

NIKKEI: 15,381.72 215.80

FTSE: 6,674.30 19.14

Cadila Health

United Spirits

Strides Arco

iemens

Bata India

HDIL

Indian Bank

SSLT

UPL

Yes Bank

BULLION

Gold: 29,865 409

Silver: 44,626 511

OIL PRICE

Brent Crude: $ 110.49 0.56

TOP 5 GAINERS TOP 5 LOSERS

P WER

Concerned over large-scale dis-crepancies in mandatory dis-closures by listed firms, Sebi

n Monday tightened its regulations inhis regard and asked bourses to put inlace a stronger mechanism with addi-onal manpower to monitor adequacynd accuracy of such disclosures.

The companies would also have torovide the details of their promoters,irectors and/or key management per-onnel who would be held responsibleor ensuring compliance with the dis-

closure norms, while stock exchangeshave been asked to publish these de-tails on their websites in case of de-faults. Sebi has also asked the stock ex-changes to set up a separate monitor-ing cell with identified personnel to en-sure compliance with the new norms. The stock exchanges, who act as front-line regulator for listed companies, havealso been asked to "keep themselves in-formed of the updates in various mediaincluding print and mass media with re-spect to a listed company."

The bourses will scrutinise the disclo-sures and ensure that no important infor-mation has been omitted by the compa-ny. It has been often found that key busi-ness developments first appear in media

and later in company's regulatory filings.Issuing detailed guidelines on corpo-

rate disclosures, which are governed byListing Agreement signed by the listedfirms with the stock exchanges, Sebisaid that the stock exchanges wouldtake appropriate actions including levy-ing of fine on the companies in case of non-compliance. The bourses wouldalso submit to Sebi an "Exception Re-port" in addition to the existing report-ing requirements, with the details of companies which do not respond to

the clarifications sought by themand/or where the response submittedby the company is not satisfactory.

While provisions in existing regula-tions also require listed companies to

file disclosure reports with stock ex-changes about every key informationand developments, the new normshave been put in place for more effec-tive implementation and compliance atthe end of stock exchanges as well asthe companies. "Concerns have beenraised that even though listed compa-nies make disclosures to Stock Ex-changes within the time frame stipulat-ed under the Listing Agreement; thecontents of the disclosures made bysuch companies are not adequate and

accurate. Therefore, investors are unableto take informed investment decisionsbased on such disclosures," Sebi said.

SOURCE: FREE PRESS JOURNAL

The Reserve Bank of India onMonday said it will provideRs.5,000 crore liquidity sup-

ort to micro and small enterprises toelp them tide over difficulties theyight be facing arising out of the eco-

omic growth slowdown.The central bank will provide thepport through the Small Industrial

evelopment Bank of India (SIDBI) ine form of refinancing of loans.“The refinance will be available for di-ct liquidity support to finance receiv-

ables, including export receivable, toMSEs by SIDBI or for liquidity supportto MSEs through selected intermedi-aries, that is, banks, Non-Banking Finan-cial Companies (NBFCs) and State Fi-

nance Corporations (SFCs), the RBI said.“The refinance will be available

against receivables, including exportreceivables, outstanding as on Nov 14,2013 onwards,” it said.

The facility will be available at theprevailing 14-day term repo rate for aperiod of 90 days. During this 90-dayperiod, the amount can be flexiblydrawn and repaid. "At the end of the90-day period, the drawal can also berolled over," the RBI said.

The refinance facility will be available

for a period of one year up to Nov 13,2014. The utilisation of funds will begoverned by the policy approved bythe Board of SIDBI, the RBI said.

RBI buys gilts

The central bank purchased Rs6,156.74 cr of government bondsthrough an open market operationauction, less than the notified amount.Last week, RBI Raghuram Rajan hadsaid the RBI planned to purchase Rs8,000 cr of government bonds throughOMOs to improve liquidity. The RBI of-fered to buy 7.17% 2015 gilts, 7.59%2016, 7.83% 2018 and 8.20% 2025 giltsin the auction.


RBI offers Rs 5,000 crore liquidity support to MSEs

Sebi tightens corp disclosure

norms, bourses to up vigilFIRMS will have to provide detailsof their promoters, directors,stock exchanges will publish

details on their websites

Buys Rs 6,156 cr of government bonds through an open market

operation auction

Telecom regulator TRAI has toldthe government that it can’tsuggest a price for auction of

spectrum in CDMA-band in the stipulat-ed 15 days and the process needs to bestarted afresh if reserve price for suchairwaves is to be set. The Telecom Regu-latory Authority of India had in Septem-ber proposed a cut of up to 60% in theminimum auction prices for mobilephone spectrum used by GSM technol-ogy players like Airtel and Vodafone, butrecommended no auction of 800 MHzspectrum used by CDMA players.


Trai for freshprocess for

CDMA spectrum

Documents

Empower 22 November 2013