Refusing to upgrade India’s credit rating for the 12th year in a row, Fitch retained its sovereign rating for the country at ‘BBB-’, the lowest investment grade with a stable outlook, saying a weak fiscal position continues to constrain the ratings and there were significant risks to macroeconomic outlook. The government has been making a strong pitch to Fitch Ratings for an upgrade after rival Moody’s Investors Service in November 2017 gave the country its first sovereign rating upgrade since 2004. Fitch had last upgraded India’s sovereign rating from BB+ to BBB- with a stable outlook on August 1, 2006. “Fitch Ratings has affirmed India’s long-term foreign currency issuer default rating (IDR) at ‘BBB-’ with a Stable Outlook,” it said in a statement. The rating, it said, “balances a strong medium-term growth outlook and favourable external balances relative to peers with weak fiscal finances, a fragile financial sector and some lagging structural factors.”
Vodafone-Idea reports £500 mn loss in Q2
Vodafone and Idea Cellular began their journey on a tough note as merged entity. India's largest telecom operator reported a loss of nearly £500 million in the second quarter of this fiscal. Vodafone-Idea witnessed £766.4million in revenues and announced plans to raise up to £2.5 billion of new equity capital by March-end 2019, indicating they are prepared to take the competition head-on. Of this, promoter shareholders - Vodafone Group and Aditya Birla Group - will contribute up to £1.1 billion and up to £725 million respectively. The merged entity set up a committee of board members to evaluate the capital raise. “The board remains optimistic about long-term outlook for the market and future for business, and recognises that further equity funding is required to ensure that the company has sufficient balance sheet flexibility to successfully execute its strategy,” Vodafone-Idea said. “The committee will be evaluating various options, including, but not limited to, a rights issue, qualified institutional placement and/or a preferential share issue.” Vodafone and Idea Cellular had decided to merge operations, following the stiff competition unleashed by Reliance Jio with dirt-cheap tariffs, which launched services in September 2016.
Ashok Chawla steps down as Yes Bank chairman
Ashok Chawla, chairman, Yes Bank has stepped down stating that the current transition period calls for someone who can devote more time and attention. The resignation comes days after the bank sought RBI’s opinion on Chawla continuing as chairman after being named in a corruption chargesheet in the Aircel-Maxis case. Chawla, former secretary with the ministry of finance, is also the chairman of the National Stock Exchange. The transition period referred to by Chawla pertains to the imminent change in CEO on the bank after RBI said that current ceo Rana Kapoor can continue only until end January 2019. Earlier in July the Central Board of Investigation named several officials, including former finance minister P Chidambaram and his son Karti for alleged irregularities and criminal conspiracy in the Aircel-Maxis case. However, CBI officials need government permission to prosecute Chawla in terms of the amended Prevention of Corruption Act.
Infosys building $35 mn education centre in US
India's IT major Infosys began constructing its US Education Centre at Indianapolis in mid-west Indiana state for its employees at a cost of $35 million (Rs 252 crore), said the global software major. "The upcoming training campus and residential centre will prepare the American workforce for the technology jobs of the future," said the IT firm in a statement. The 125,000-square feet innovation centre is located on a 70.5-acre land on the west side of the city on the old Indianapolis airport terminal. It will house its employees and that of its select clients. The first phase of the project is expected to be completed by 2020. "The centre will be a symbol of our commitment to train American workers as learning and reskilling are core components of our DNA," said Infosys Chief Operating Officer U.B. Pravin Rao on the occasion. The $11-billion outsourcing firm committed on May 2, 2017 to hire about 10,000 American techies to bridge the IT skills gap in the United States and set up six technology-cum-innovation hubs across North America by 2022-23.
IDBI reports £360.2 mn loss, LIC to infuse £2 bn
IDBI Bank reported a loss of £360.2 million for the quarter ended September 2018 as against a net loss of £19.8 million in the same quarter last year. Announcing the results the bank’s CEO Rakesh Kumar said that Life Insurance Corporation (LIC) is set to infuse £2 billion into the bank, which will immediately improve the bank’s capital adequacy ratio to 16% from 6.22% at present, but might drop after next quarter’s results. The public sector bank continued to report losses as it had to set aside £471.5 million toward loans that had turned bad. Kumar said that LIC’s investment is awaiting approval from the competition commission, following which Sebi approval is expected. LIC has already decided on a tentative date of December 4 for an open offer. India's largest insurer’s stake in the bank will rise to 51% from 14.9% at present.
Nissan Motors Chairman Carlos Ghosn 'arrested'
Nissan Motor Chairman Carlos Ghosn was reportedly under arrest in Tokyo, as his firm accused him of “significant acts of misconduct” and said it would seek to oust him. Japan’s public broadcaster NHK and other media outlets said Ghosn had been arrested after being questioned by prosecutors for various improprieties, including under-reporting his income. In a statement, Nissan said it had been conducting a probe into him for several months after receiving a whistleblower report and had uncovered misconduct going back several years. The Tokyo prosecutor’s office had no comment on the reports about Ghosn, who also heads an alliance of Renault, Nissan and Mitsubishi. Nissan said it launched an investigation into both Ghosn and Representative Director Greg Kelly several months ago.
