Maharashtra CM Devendra Fadnavis addresses Investors in New York

June 30, 2015 – New York- Today a group of U.S. industry executives from the U.S.-India Business Council (USIBC) met with the Chief Minister of Maharashtra, Devendra Fadnavis for a discussion about investment opportunities in the state.

Chief Minister Fadnavis engaged with senior business executives on important topics that have dominated the bilateral commercial relationship in recent months and addressed areas such as Maharashtra’s comparative edge as an investment destination, regulatory reform measures that have been undertaken by the government to promote ease of doing business in the state, and cultural dialogues that can enhance the bilateral relations between India and the United States.

Emphasizing the investment opportunities that are available in Maharashtra, Chief Minister Fadnavis said, “The Government has taken a variety of measures to promote ease of doing business in the state and we want to be viewed as a top destination for both domestic as well as international investments. The state eagerly awaits the formation of joint ventures in critical projects such as the Delhi - Mumbai Industrial corridor, Smart Cities and in sectors such as manufacturing, agriculture, aviation, engineering and IT. Our Government is committed to providing a boost to both Make in India and Make in Maharashtra campaigns, provide business to both medium and small enterprises and create much-needed jobs. We invite investors from the United States to be a part of Maharashtra’s growth story.”

Lauding the vision of Chief Minister Fadnavis, Mukesh Aghi, President of USIBC, said, “The Council’s member companies have been encouraged by the ease of doing business in Maharashtra. Many of the companies have significant investments in the state. Therefore, appropriate and timely policy measures are critical. USIBC and member companies look forward to participating in the state’s investment opportunities that will not only promote entrepreneurship, but also inclusive growth, positioning it as a model state both in India and globally. I have no hesitation in saying that the state has the potential to emerge as a high ranking state on the ease of doing business index.”

Ashok Vasudevan, Chairman and CEO of Preferred Brands International, manufacturer and marketer of the natural foods brand, Tasty Bite, said, “Tasty Bite has been operating in Maharashtra since the early 90’s and has become one of India’s largest exporter of prepared foods. The state is remarkably resilient due to its diversified base of industry that includes energy, agriculture, food processing, entertainment, engineering, chemicals, pharmaceuticals and financial services. The infrastructure, a mature workforce, a series of business friendly administrations over the last few decades makes it an attractive FDI destination.”

The event was also attended by companies and senior leaders from every major sector of business— Monsanto, Taj Hotels, HSBC, Caterpillar, Cargill, Johnson and Johnson, KPMG, Baker & McKenzie, Citi, New Silk Route and Pfizer.

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IIC submits representation for 2015 Budget to Govt

Impact Investors Council (IIC), an industry body to promote impact investing in India, today submitted a representation for the forthcoming Budget to the Minister of State for Finance, Shri Jayant Sinha, on behalf of the investors and social entrepreneurs, seeking recognition for the Rs 10,000-crore sector, and easier financing for social enterprises.

Impact Investors invest in social enterprises, which are working to create social and environmental change in the country.

Impact investing essentially involves investing with the implicit intention of generating positive social impact along with a return on capital. It ends the old dichotomy, which saw business as simply a way to make profit, while social progress was best achieved through charity or aid.

Impact investment has been growing at a rate of 27%in India over the last seven years, and 30+ impact investment funds in the country have invested a cumulative amount of $1.6 billion in 300+ social enterprises and across a range of industries such as financial inclusion, agribusiness, healthcare, education and clean energy, among others[1].

Social enterprises in India have exemplified the power that businesses can do ‘good’ while creating value for themselves. However, they have found it challenging to source institutional capital, especially in their initial years. Impact investing has played a key role in filling the crucial gap of financing social enterprises in India.

“Impact Investors have used the power of financial markets and ingenuity of social entrepreneurs to build Rs 10,000 crore impact investment industry with a promise to exceed Rs 6,000 crore annually by 2020. The industry helps bridge our national social investment gap while serving the poor and underserved. Therefore, IIC is requesting the Government to partner us and help galvanize the impact investment eco-system,” said Amit Bhatia, Chief Executive Officer, IIC.

In its first ever member-only convention, the board members of the council presented the priority areas that need immediate attention from the government to boost the impact investing activity in India. IIC requested for the following:

1. Official recognition of impact investors, social enterprises and IIC

2. Review of social venture fund (SVF) guidelines

3. Extending priority sector lending to social enterprises

4. Increasing access to External Commercial Borrowing (ECB) funding by social enterprises

5. “Panel Member” on the high level committee on Corporate Social Responsibility (CSR) and social impact assessment measures.

The number of impact investors-funded social enterprises is expected to reach 1,000 by 2020. The staggering growth is on the back of impact investment, which is estimated to cross $6 billion or Rs 40,000 crore by 2020, while the annual figure is likely to exceed $1 billion in the next five years. The cumulative investment of Rs 10,000 crores positions India as one of the largest impact investment destinations in the world[2].

IIC is working towards the goal of reducing information asymmetry in the impact investing sector. The council has helped in establishing a working definition of impact investing that outlines the contours of impact investing and an impact investor in India. It has also put forth a comprehensive view on the quantum of impact investing across years, sectors and stages of enterprise growth. In addition to these activities, IIC is currently working towards developing national standards for impact assessment and measurement.

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FDI Policy Clarifications on Multi-Brand Retail Trading in India

Yesterday Department of Industrial Policy and Promotion (DIPP) had answered many queries from stakeholders and investors regarding the FDI policy of Multi-Brand Retail Trading. After the FDI in retail has got the green signal, many single brand retailers are showing interest to invest in India. But the multi-brand retail trading is still deeming as most are still unknown to the rules.

To clear the confusion DIPP answered the queries and also published a document regarding this. We’ve compiled some of the major queries and their answers here –

Issue - 30% sourcing from Small and Medium Enterprises  

Question - Can the Foreign Investor purchase the 30% of the total procurement of manufactured or processed goods by the SME but distribute them either through the retail operation and/ or cash & carry operations and/ or export for the Foreign Investor’s International retail & trading operations?

Answer - No. The 30% sourcing will be reckoned only with reference to the front end store. As such a Multi-brand retailing entity cannot engage in any other form of distribution.

Issue - 50% investment in back-end infrastructure

Question - Can the new retail entity to be set up acquire supply chain/back-end assets or stake from an existing company having such assets and will such assets /stake values be counted towards the back-end investment requirement?

Answer - No. Entire investment in back-end infrastructure has to be an additionality. The entity can invest only in greenfield assets and it will not be possible to acquire supply/chain/backend assets or stakes from an existing entity

Question - Whether investment in back-end infrastructure for instance for storage, warehouses, agricultural produce infrastructure in non-FDI approved states will be counted towards investment in back-end infrastructure.

Answer - FDI in these activities is already allowed throughout the country. As far as MBRT is concerned FDI in non-FDI approved States in back-end infrastructure will be counted provided it is additionality.

Question - Will the new retail entity include back-end facilities that have the capacity to supply its own businesses and other businesses? It should be free to supply back-end services (e.g. logistic supply, goods) to related or third party companies, including but not limited to the company’s existing wholesale entity and the retail franchisee operated by its partners.

Answer - As per the conditions for wholesale cash & carry trading, such an entity is not permitted to undertake retailing of any form. Therefore, both the businesses have to be kept separate through different entities. As regards supplies by MBRT company to franchisees run by its partners, it is clarified that the policy envisages multi-brand trading in retail. The MBRT entity is not envisaged to undertake wholesale activity i.e. B2B. The front-end stores set up by MBRT entity will have to be ‘company owned and company operated’ only.

Question - Would a company operating in wholesale trading/ cash & carry trading be considered as a company providing back-end infrastructure in efficiently distributing the goods to the small retailers and professional/ business users?

Answer - No. The wholesale trading/ cash & carry trading cannot be considered to be providing back-end infrastructure. FDI in MBRT will require fresh investment in back-end infrastructure.

Investment in Front-end / back-end infrastructure

Question - If the same foreign investor is an investor in various companies for logistics, services etc., will the back-end investment made by such investor be aggregated?

Answer - No. Investments in multiple infrastructure companies would not be counted towards fulfillment of condition of investing 50% in the back end infrastructure.

Policy on E-commerce

Question - Allowing online sales will enable the Company to better serve Indian customers through enhanced convenience and assortment as well as improve the site customer experience. This will allow the company to make significant investments in Logistics.

Answer - Multi-brand retail trading by way of e-commerce is not permitted.

Investment in greenfield or brownfield front-end entities

Question - Can the minimum investment of US$ 100 Million be used to acquire existing retail stores or setting up new retail stores or a combination of both?

Answer - 50% of the investments brought in, must be invested in back-end infrastructure, and any amount spent in acquiring front end retail stores would not be counted towards back-end infrastructure. The front-end retail stores must also be set up as additionality and not through acquisition of existing stores.

As per the reports, there are some other issues which are still under consideration by DIPP and soon will be notified to the investors or stakeholders. For more information, download the full document from DIPP site here .

Image Courtesy - TheHinduBusinessOnline.com

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Sahara clearing confusion over Repayment Liability in Public PR

Sahara has published a Public press release (PR) where it clearly stated about the actual repayment liability and clears the confusing media hoax over the 25,000 Crore liability among stake holders. This press release is probably published in every national and local newspapers of India where Sahara made some points on the actual liability. If you have not find the PR yet, then you can read the points below:

Sahara states [Courtesy - Sahara India Pariwar ]:

• Total liability was around Rs. 25,000 Crores of both the OFCD companies.

• Over a period of time, we have redeemed the OFCDs issued to the Investors and presently, the total outstanding liabilities of both the companies is Rs. 2,620 Crores only.

• We have already paid to SEBI a sum of Rs. 2,620 Crores plus also Rs. 2,500 Crores as a buffer amount subject to physical verification of all documents, at company's end. The buffer amount has been paid so that at any stage if there a difference, Sahara should not face any element of embarrassment. 

• SEBI and SAT (Securities Appellate Tribunal) had directed us to  clear all the liabilities of both the companies towards the OFCDs issued (around Rs. 25,000 Crores), but did not ask for double the amount meaning around Rs. 50,000 Crores.

• But as per order, we have to pay SEBI around Rs. 25,000 Crores again in the next 2 months, which means we have to pay again the whole amount which has already been paid.

• In last 34 years there has not been a single complaint of non-repayment against us though in last 34 years we have repaid liabilities of Rs. 1,70,636 Crores to 14.7 Crores account holders.

Sahara has been clearing confusion and also facing troublesome situations around times. Recent past Sahara chairman Mr. Subrata Roy has come to public himself to explain why Sahara will not be sponsoring the Indian cricket team anymore and from his explanation you can only blame the government and officials. Anyway, after some compromise Sahara agreed to sponsor India cricket team. We guess same fate happened here too and Sahara is taking the pain to maintain its image before the stake holders and investors.

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Useful Finance and Investment words from Investopedia

I've subscribed to Investopedia Term of the Day newsletters where I get each day a word related Finance, Business, Economy or Investment. I've been reading them and it's quite helpful for me in understanding the USA stock market. Hope it will help you too. Let's have a look on some of these words [all these word explanations are extracted from Investopedia Newsletters]:

Image Credit: VigyanPrasar

Christmas Club

A short-term savings account that usually pays out the full account balance to its account holders once each year, right before Christmas. Christmas club accounts pay depositors monthly interest on their account balances and often punish early withdrawals by retracting interest earned if money is taken out before a given date.

Icahn Lift

The name given to the rise in stock price that occurs when Carl Icahn begins to purchase shares in a company. The Icahn lift occurs because of Mr. Icahn's reputation for creating value for the shareholders of the companies in which he takes an interest.

Carl Icahn is most famous for his work as an activist shareholder, but has also been referred to as a corporate raider. He purchases shares in a company that he believes is undervalued and then creates a plan to fix the problems. This usually involves spinning off profitable segments, changing management, cutting costs and buying back stock.

ARM Margin

A fixed percentage rate that is added to an index value to determine the fully indexed interest rate of an adjustable rate mortgage (ARM). The margin is constant throughout the life of the mortgage, while the index value is variable. For example, the index might be the prime rate, which varies according to market conditions, and the margin might be 2%. If the prime rate were 5% and the margin 2%, then the fully indexed interest rate would be 7%. If the prime rate rises to 6% (the margin remains constant), the fully indexed interest rate would be 8%.

Bag Man

Any person in charge of organizing, collecting and transporting money, generally in connection with illegal or illicit activities. A bag man is someone who collects and delivers money on behalf of a boss or organization. Nowadays, bag man can be used pejoratively to describe an individual who is in charge of collecting and delivering contributions to political parties or fundsgathered for political purposes.

Consumer Internet Barometer

A quarterly survey report produced by the Conference Board and TNS NFO that records, analyzes and reports on the internet usage of 10,000 U.S. households. The survey seeks to measure:

1. the importance of the internet in the daily lives of households

2. overall satisfaction of internet users

3. online purchase characteristics, times and dates

4. users' perceptions of security for online transactions and general internet usage

Trickle-Down Effect

A phenomenon where an advertisement is rapidly disseminated by word of mouth or by viral marketing. The trickle-down effect works when an ad is so compelling, either because of its uniqueness, humor, entertainment value or other outstanding trait, that people are excited to share it with their friends, family and coworkers.

Upside Gap Two Crows

A bearish market reversal signal in technical analysis. The upside gap two crows pattern is a three-day formation on candlestick charts that typically develops in the following manner:

Day 1 - A bullish day that continues the uptrend, represented by a long white candlestick, which indicates that the closing price of the index or security is well above the opening price.

Day 2 - A bearish day despite the index or security gapping higher at the open, represented by a small black or colored candlestick.

Day 3 - A second bearish day, with the index or security opening higher than the Day 2 open, but closing below the Day 2 close and above the Day 1 close. This is visually represented by a bigger black or colored candlestick that "engulfs" the Day 2 candlestick.

Turkey

Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities that realize significant losses and unsuccessful initial public offerings (IPOs) could all be called "turkeys".

Intelligent ETF

An exchange-traded fund (ETF) that employs an active investment strategy based on a broad index, such as the S&P 500 or a sector-based index. The fund may choose to exclude some stocks within the index while increasing or decreasing the percentage weighting of other stocks. Most intelligent ETFs carry higher expense ratios than standard ETFs, as well as substantially higher turnover ratios.

If you want to know more terms used in USA stock market then you can start subscribing Investopedia newsletters.

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Global Investor's Meet to start in Indore from October 28

Indore, 26 October, 2012: The leading PR agency of north India, PR 24x7 welcomes all the corporate houses participating in Global Investor's Meet being organized in Indore from 28 October 2012 to 30 October 2012. Hosted by MP government, this 3 day event aims to explore new business prospects in central India and attract investments from those industries, which can generate maximum employment opportunities for the people of state.

Delegates from 21 countries and about 2200 investors from India and abroad will take part in this event. The largest PR agency of central India, PR 24x7 welcomes all the guests on the pious land of Devi Ahilya and offers them its help and support to make this meet successful and smooth experience for them. The director of PR 24x7 Mr. Atul Malikram said, "In this 3 day event many big corporate houses will discuss the potential in this area and explore the possibilities of investment. We as the biggest PR network of north India will offer them our services and keep them updated with every latest development in this area."

PR 24x7 Network Limited has an extensive network in almost all major cities in Madhya Pradesh, Maharashtra, Orissa, Punjab, Rajasthan, Uttaranchal, Uttar Pradesh, Bihar, Chattisgarh, Gujarat, Jharkhand and Kerala. Mr. Atul Malikram further said, "We provide our clients specialised services in Media Monitoring and Press conference, Press release dissemination, issue management and media relations. Our team provides timely updates to our customers so as to keep them ahead of their competitors."

For more detail, please contact:
Ritu @ 9827092823
Breakfastnews@gmail.com

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