Economy Current Affairs
Economy Current Affairs April 3rd Week 2016
Category : Economy Current Affairs
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1) US Jury Slaps $940 Million Fine on Tata in Trade Secret Case, TCS Denies Wrong doing.
  • An US grand jury has slapped a $940 million fine on two Tata group firms Tata Consultancy Services and Tata America International Corp in a trade secret lawsuit filed against them by Epic Systems.
  • The jury has asked the Tata firms to pay $240 million to Epic Systems for ripping off its software and also asked to pay $700 million in punitive damages.
  • Epic Systems had accused TCS and Tata America International Corp, in a lawsuit filed in 2014 in US District Court in Madison which was amended, of ``brazenly stealing the trade secrets, confidential information, documents and data`` belonging to Epic.
  • TCS acknowledged the receipt of the verdict, but denied any wrong doing.
  • The jury’s verdict on liability and damages was unexpected as it believes they are unsupported by the evidence presented during the trial.
  • The Company did not misuse or derive any benefit from downloaded documents from Epic System’s user-web portal. TCS plans to defend its position vigorously in appeals to higher courts. TCS appreciates the trial judge’s announcement from the bench that he is almost certain he will reduce the damages award.
  • The jury verdict would not have any impact on its Q4 and FY16 results to be announced.
2) Altico Capital India gets board nod to raise Rs. 2,000 crore.
  • Mumbai-headquartered non-banking finance company Altico Capital India has received board approval to raise Rs. 2,000 crore through a mix of instruments. The company will raise the funds through bank lines, and issue of commercial papers and non-convertible debentures (NCDs).
  • The company will use the proceeds to finance mid-income and affordable housing across tier-I cities.
  • The NBFC focuses on senior secured lending to residential projects in the real estate sector across tier-1 cities.
  • Altico Capital is well-positioned to capitalize on direct lending opportunities in India, with a focus on making senior secured loans to the real estate sector whilst retaining the flexibility to invest across multiple strategies.
3) Indian Railway used drone for the first time to inspect Dedicated Freight Corridor project.
  • Indian Railway has used drones for the first time for inspecting a mega rail project to assess the progress on the ground and the flying machine would now be used to monitor other under-construction schemes.
  • An unmanned aerial vehicle, also called drone, was used to inspect the ongoing work on the Dedicated Freight Corridor (DFC) project and, as per the plan, all ongoing projects will be monitored through aerial survey.
  • Besides, the public sector behemoth has also decided to use drones to assess the ground situation in the aftermath of train accidents.
  • A drone is essentially a flying robot which can be remotely handled through software-controlled flight plans embedded in its systems working in conjunction with GPS.
  • The drone was used for three days on a trial basis to cover the total 98 km on the DFC. The status report was prepared after the analysis of video recordings.
  • It becomes easier and faster to prepare the status report of an ongoing project through drone. Field work can be monitored from the office using the drone footage.
  • The drone was hired from a private operator and it cost Rs. 3,000 per km for undertaking the aerial survey.


4) NestAway raises $30 million in series C funding.
  • NestAway Technologies Pvt Ltd, the Bangalore-based leader in the ‘managed’ home rentals market, has raised $30 million in a Series C financing led by Tiger Global, Yuri Milner, the Russian billionaire investor/founding partner of DST Global and IDG Ventures India.
  • Earlier this year, NestAway had raised an undisclosed round from Ratan Tata, Chairman Emeritus, Tata Group.
  • NestAway had previously raised more than $13 million in capital over two rounds from marquee investors including IDG Ventures India, Tiger Global, Flipkart, and Naveen Tewari & Kanwaljit Singh.
  • NestAway manages a house-owner’s rental property throughout the rental life cycle starting from showing the house to the prospects, closing the rental agreement to collecting rent on the owner’s behalf and assisting the tenant and owner during move-out.
  • The company charges a small percentage of monthly rent it generates from the house as commission; NestAway does not charge any brokerage or upfront fees to either the owner or the tenant.
5) India To Purchase 145 M777 Howitzers For US $750 Million.
  • The decision to buy ultra-light Howitzers produced by BAE Systems under the ‘Make in India’ program was discussed at a meeting between Indian Defense Minister Manohar Parrikar and his US counterpart Ashton Carter.
  • The artillery gun programme to equip the Mountain Strike Corps is being finalized as India and the US are in agreement on its ``make in India`` component.
  • The initial price notified by the US in 2012 was $694 million. The manufacturer has been seeking 10 per cent hike on the four-year-old price. The negotiation price is about $750 million.
  • The tender will be for associated equipment, parts, training and logistical support. The gun will come with laser inertial artillery pointing systems (LINAPS), maintenance, personnel training and training equipment, technical assistance, engineering and logistics support services.
  • The Army intends to use the howitzers to modernize its forces and enhance its ability to operate in hazardous conditions.
  • In India, the BAE Systems had tied up Mahindra as its business partner for its proposed in-country assembly, integration and test (AIT) facility for the M777 Howitzer.
6) Zurich Airport sells 5% in BIAL to Fairfax for $49 million.
  • Zurich Airport has inked an agreement to sell its 5 per cent minority shareholding in Bengaluru International Airport Ltd (BIAL) to the Prem Watsa-backed Fairfax Holdings for $48.9 million.
  • Subject to customary regulatory approvals, the deal is expected to be completed within the third quarter of 2016. While there has been no word on the agreement from Fairfax.
  • BIAL owns and operates Kempegowda International Airport Bengaluru (KIAB) under a 30-year concession agreement from the Indian Government, with an option for a further 30-year extension.
  • KIAB, which began operations in 2008, is among the first Greenfield airports in India built under a public-private partnership. It is now India’s third largest airport.
Ownership pattern
  1. The GVK Group, which had acquired a 29 per cent stake from L&T and Zurich Airport and 14 per cent from Siemens Project Ventures in the past, recently divested its 33 per cent stake in the airport to Fairfax Financial Holdings Ltd for Rs. 2,149 crore, to pare its corporate debt.
  2. GVK’s stake is now 10 per cent, while Fairfax is the largest shareholder with a 38 per cent stake (including the Zurich Airport stake). Siemens has a 26 per cent stake, while the Airports Authority of India and the Karnataka government hold 13 per cent each. 

7) Suzlon Energy buys 5 firms.

  • Suzlon Energy has acquired five small solar companies for an undisclosed sum to implement various renewable energy projects across the country.
  • The company has acquired Gale Solarfarms, Tornado Solarfarms, Abha Solarfarms, Aalok Solarfarms and Shreyas Solarfarms to implement various renewable energy projects across the country, including the recently won solar projects in Maharashtra of 70 MW.
  • These companies, which have been acquired at face value, do not have any operations or assets currently and have been acquired primarily to be used as SPVs for the proposed solar project.
  • Shares of the company were trading 4.80 per cent up at Rs. 15.28 apiece on BSE.

8) JK Tyres acquired Cavendish Industries for 2200 crore rupees.

  • JK Tyre & Industries has completed acquisition of Cavendish Industries which houses three tyre business undertakings of Birla Tyres at an enterprise value of Rs 2200 crore.
  • The plants are located at Laksar (Haridwar), which manufactures a range of tyre, tubes and flaps.
  • The acquisition has been funded through a combination of internal accruals and debt.
  • With this acquisition JK Tyres will have 12 manufacturing units across India and Mexico.
9) MUDRA Bank invests Rs. 50 crore in MSME loan portfolio.
  • The Micro Units Development and Refinance Agency Bank (MUDRA Bank) has invested Rs. 50 crore in the A (-) rated senior tranche of securitized MSME loan portfolio of Janalakshmi Financial Services, a Bengaluru-based micro-finance company.
  • This will be a short-term transaction with a tenure of 1.5 years, according to a press release from IFMR Capital, which facilitated this transaction. Through this deal, MUDRA Bank, which provides low-cost loans to micro-finance and non-banking financial institutions, will have exposure to over 100 micro-finance and NBFCs.
  • This is also the bank’s maiden exposure to securitization. IFMR Capital also participated as an investor through its investment in the subordinated tranche.
10) Muthoot Capital net up 11.5% in fourth quarter.
  • Muthoot Capital Services’ loan book has crossed the Rs. 1,000 crore mark on the back of aggressive two-wheeler financing and diversification into corporate lending.
  • For the quarter ended, net profit grew 11.53 per cent to Rs. 6.87 crore from Rs. 6.16 crore. Total income rose to Rs. 63.41 crore from Rs. 51.98 crore, registering a growth of 22 per cent. Interest expenditure increased to Rs. 22.34 crore from Rs. 19.62 crore.
  • The full-year results too showed impressive growth with total income increasing to Rs. 228.49 crore in 2015-16 from Rs. 191.29 crore in the previous year, a growth of 19.44 per cent. The net profit for the year, at Rs. 22.85 crore, was up 2.5 per cent, compared with Rs. 22.29 crore in the previous year.
  • The improved performance was the direct result of a substantial growth in loan disbursements. The company’s foray into corporate and other business loans also helped boost the loan disbursements. The total loan sanctioned for the quarter was Rs. 314.65 crore. This comprised two-wheeler loans totalling Rs. 234.76 crore, and corporate and other business loans worth Rs. 79.89 crore.
11) Airtel to sell 5% stake in Bharti Infratel.
  • Bharti Airtel, the country’s biggest operator by revenue and subscribers, has initiated talks to sell more than 5 per cent of its telecom tower subsidiary Bharti Infratel through open market sales.
  • The move would result in the New Delhi-based telecom firm getting more than Rs. 3,700 crore.
  • Airtel, which owns a 71.7 per cent stake in the tower unit, intends to use the proceeds to pare debt and for further rollout of 3G and 4G infrastructure.
12) Tide Water Oil acquires UK firm for £9.59 million.
  • Tide Water Oil (India), controlled by state-owned Andrew Yule & Co Ltd, has acquired British lubricant firm Price Thomas Holdings Ltd (PTHL) for £9.59 million.
  • PTHL, a lubricant manufacturing unit in UK, will lend it space in the competitive European market.
  • Tide Water is expanding market for its branded lubricant Veedol in Europe. As the target company has a manufacturing facility in the UK, the proposed acquisition is envisaged to result in competitive product pricing of the acquirer for the European market.
  • PTHL’s gross revenue as on 2014 was £10.92 million with a corresponding PBT of £0.87 million. PTHL is a manufacturer and supplier of lubricants and car care products in the UK and in overseas automotive markets such as Ireland, Sweden and Bulgaria. Tide Water, which signed the share purchase agreement, will not require any Government permission for the acquisition as it falls within the automatic overseas investment route.
13) Cyient posts Rs. 815 crore revenue in fourth quarter.
  • Cyient Ltd (formerly InfoTech Enterprises) posted revenues of Rs. 815 crore in the fourth quarter ended 2016 a 4.4 per cent growth quarter on quarter. The net profit for the quarter was at Rs. 66 crore.
  • For the financial year 2015-16, the firm registered a turnover of Rs. 3,096 crore, a growth of 13 per cent over last year. The net profit for the year stood at Rs. 326 crore.
  • The revenue for the year was lower than what originally committed. As a result of these challenges, the last financial year was a disappointing year.
14) Hindustan Zinc net profit rises 8% in Q4.
  • Vedanta Group firm Hindustan Zinc reported an 8 per cent increase in net profit to Rs. 2,149 crore for the fourth quarter of 2015-16, aided by mark to market gains on its investment income. In the same quarter last year, net profit was at Rs. 1,997 crore.
  • However, net revenues during the quarter fell 25 per cent to Rs. 3,070 crore (Rs. 4,073 crore).
  • The decrease was on account of lower zinc volumes and prices on the London Metal Exchange, The lower volumes were partly offset by higher volumes of lead and silver as well as the depreciation in the value of rupee as compared to the US dollar. Cost of zinc metal production was Rs. 58,044 per tonne or $853 per tonne, which was 4 per cent higher in US dollar terms and 14 per cent higher in rupee terms.
15) Reliance Ind Q4 net jumps 16% to Rs. 7,398 crore.
  • Record refining volumes and strong petrochemical margins helped Reliance Industries report a nearly 16 per cent jump in net profit to Rs. 7,398 crore in the three-month period ending 2016. For fiscal 2015-16, RIL reported its highest ever consolidated net profit of Rs. 27,630 crore, up 17.2 per cent from FY15.
  • However, revenue fell 8.9 per cent for the quarter to Rs. 64,569 crore and for the full year, which the company attributed to a ``sharp fall in feedstock and product prices``. Instead, RIL focussed on volumes and operating margins - refining throughput stood at 17.8 million tonnes for the quarter, a capacity utilization rate of 115 per cent at the flagship Jamnagar refinery.
  • Gross refining margins - the difference between the cost of crude oil and final selling price of refined products - were $10.8 a barrel, marginally higher than the $10.1 rate reported in the corresponding period of the previous year.
  • RIL is expected to have the highest annual profit among the top 10 companies in the country.
  • The upstream oil and gas exploration business continued to languish due to lower crude oil price. Segment revenue fell 34.8 per cent for the quarter to Rs. 1.638 crore. Production in US shale volumes remained largely flat.
  • Revenue for organized retail - Reliance Retail has stores which sell grocery, consumer electronics and apparels - continued to grow at a blistering pace, at 20.7 per cent year-on-year to Rs. 5,781 crore this quarter.
16) Reliance Defence to raise Rs. 1,200 crore.
  • Anil Ambani Group Company Reliance Defence and Engineering Ltd will soon raise Rs. 1,200 crore through rights issue.
  • The proceeds will be used for increasing long-term resources and exiting from corporate debt restructuring.
  • The price, entitlement ratio and the date for the rights issue will be decided in due course and in consultation with the advisors and bankers to the issue.