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Commentary

#Linkfest: Tax Free NPS, Amrapali Siphons off 2600 cr., HCL Buys Lotus Notes

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At Capitalmind Premium, we have a very active Slack channel where we discuss a lot of interesting topics. In there,  a number of interesting links come our way. Here’s a list:

  1. For central government employees, your Christmas gift has come early this year. You will still be contributing 10% in the National Pension Scheme (NPS), but the central government will now contribute 14% to it. Further, as a subscriber, you are eligible to withdraw up to 60% of the entire corpus and the whole of it would be tax-free.
    https://www.cnbctv18.com/economy/cabinet-clears-five-changes-to-new-pension-scheme-1645131.htm
  2. India and Iran have signed an agreement to make payment for crude oil import to India from the Persian Gulf nation in rupees. We used to do this earlier, but this stopped due to the US sanctions, and Iran’s refusal to take rupees. But after India agreed to cut down imports and escrow payments, US agreed to give us an exemption. India in the interim had paid Iran in euros, which stopped after the European banking channels got blocked from November.
    https://timesofindia.indiatimes.com/business/india-business/india-inks-pact-with-iran-to-pay-crude-bill-in-rupee/articleshow/66971068.cms?
  3. India needs more exports than imports… we all know that. But then when the current exports are at the risk of reducing, that creates greater concerns. Gulf Cooperation Council has decided to impose an anti-dumping duty of 15% on Indian tiles.
    https://timesofindia.indiatimes.com/city/rajkot/anti-dumping-duty-in-gulf-could-hit-tiles-export-from-morbi/articleshow/66817683.cms?
  4. Recently, the old GDP growth numbers (during the UPA tenure) were re-calculated. That created massive debate over the fact as to whether it’s the reality or that BJP is trying to show better numbers. Sanjeev Sanyal, principal economic advisor, gives his views on it, as well as the IL&FS debacle, agriculture policy and many more.
    https://www.thehindu.com/opinion/interview/our-calorie-oriented-approach-to-agriculture-is-no-longer-sustainable/article25665072.ece
  5. It’s one thing to have a financial crunch because you have run out of money. It’s a totally different matter when the financial crunch is because you have participated in creative diversion of funds… Rs. 2,996 cr. at that – Amrapali, in Delhi.
    https://timesofindia.indiatimes.com/india/amrapali-diverted-rs-3000-crore-of-homebuyers-money-cmd/articleshow/66945476.cms?from=mdr
  6.  You know that dude in the class who gets bullied by everyone to a point where he leaves school and moves away from the city? Qatar is that guy. Qatar is withdrawing from OPEC on January 1, 2019. Why? They say that that they are doing it as a part of a long-term strategy of improving its global standing. But many say it’s because Saudi had cut ties with Qatar over allegations of supporting terrorists and Iran.
    https://www.cnbc.com/2018/12/03/qatar-to-withdraw-from-opec-as-of-january-2019.html
  7. If you know you can easily get loans to buy anything you want, you would most probably pick up more loans when you go for your next shopping spree. This is exactly what has happened with the American citizens. With crazy student loans, personal loans, mortgages and vehicle loans, it’s not a matter of whether the debt bubble will burst. It’s a matter of when it will burst.
    https://howmuch.net/articles/the-great-american-debt-bubble
  8. The US yield curve inverted. That means that the the long-term bonds (5 year) are fetching lower yields compared to short-term bonds (3 year). This is considered by many as an indicator of recession. However, back in 2005 when the yield curve of 3-5 years dipped below zero, it took around 28 months weeks for recession to begin. And also note that the 5-3 may beer inverted but the 10 year and 3 month is not, and this is often tracked by the Fed, click here.
    https://www.bloomberg.com/opinion/articles/2018-12-08/inversion-of-the-u-s-treasury-yield-curve-opinion
  9. While the other directors quit the board of Yes Bank, R. Chandrashekar quit because of reasons other than shortage of time, other commitments etc. He quit because he was unhappy with the way things were progressing in Yes Bank. Now this is bad news for any stakeholder of the private bank.
    https://www.bloombergquint.com/business/deep-concern-dismay-and-distress-why-r-chandrashekhar-quit-yes-banks-board
  10. Sun pharma got in some bad news after a whistle blower filed a 150-page report about questionable transactions in the company. When asked about it to the management of the pharmaceutical company, on a conference call, they completely avoided the questions. Now, if some one has put in the effort to write a 150-page report to complain about something, there has to be some real and genuine issue in there.
    https://www.moneylife.in/article/did-sun-pharma-conference-call-deny-clarify-or-actually-muddy-the-issues/55861.html
  11. In all the hotchpotch that Yes Bank is in, they finally found some good news. SEBI has given them the nod to launch two mutual fund schemes.
    https://www.financialexpress.com/industry/banking-finance/yes-bank-enters-into-mutual-fund-business-gets-sebi-nod-to-launch-two-mutual-fund-schemes/1403240/
  12. Indian’s corporate sector is less about business and more about family feuds. The Singh brothers are no different – from Ranbaxy to physical fights.
    https://economictimes.indiatimes.com/news/company/corporate-trends/singh-brothers-of-fortis-come-to-blows/articleshow/66979644.cms
  13. Atul and Rahul Kirloskar, promoters of Kirloskar group, were found guilty of insider trading by the Supreme Court. Earlier, Rakesh Jhunjhunwala paid Rs. 2.48 lakh in settlement of an insider trading case.
    https://www.thehindubusinessline.com/markets/srikrishna-probe-faults-promoters-of-kirloskar-brothers-for-insider-trading/article25656640.ece/amp/?__twitter_impression=true
  14. Apparently Jet Airways has approached Etihad for a soft loan of $350 million. This is while discussion of selling the latter’s stake in the former is still on-going. Earlier the board of Tatas raised a lot of concerns about acquiring Jet Airways. So, even though they want to acquire the cash strapped airlines company, they are moving cautiously. Looks like Jet Airways doesn’t have the time to wait for Tatas to make the move.​​​​​​​https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/jet-airways-seeks-350-million-soft-loan-from-etihad/articleshow/66970226.cms
  15. HCL wants to use its cash. It targets a $50 billion market, and they have purchased 7 IBM software products for $1.8 billion, including the infamous Lotus Notes. We speculated on Slack that perhaps the idea is to tell business: Look we now own Notes, and we know it’s horrible, so pay us to help you transition out of it. But hey, answer
    https://trak.in/tags/business/2018/12/07/hcl-takes-over-ibms-7-software-products-for-1-8-billion-investors-not-happy-share-prices-crash/