NEWS HOUR 14th Jan– 20th Jan 2018
Weekly News Magazine
AN YEAR OF IPO BOOM In This Issue Report by - Shivam Aggarwal
The fiscal year 2017-18 proved to be the game-changer in the way the companies raise money to fund their operations and investments. This fiscal So far 122 companies have raised a cumulative amount of Rs 71500 crores. The majority of the IPO issuers were insurance companies accounting for 60% of the total value of IPOs issued. The increment seems humongous because in the fiscal years 201617 and 2015-16 only Rs29000 crore and Rs 15000 crore were raised stating a 150% increase in the total value of the shares offered through IPOs. Despite observing such a huge positive change in the IPOs HDFC securities feel that this number could have touched Rs 1 trillion figure had it not been for the nil/ low capex and a very few number of offer-of-sales issues by promoters. Dhiraj Relli of HDFC securities stated that the number seems to be humongous in comparison to last few years, but the total value of the IPOs account for only 1% of the total GDP value which is lower in comparison to the Year 2008 where the value accounted for 2% of the total GDP. He highlighted some of the factors that might have effected the market this year like low or no demand of capital by large companies for expansion, low current capacity utilization among many. He also stated that the IPO market has not yet hit its peak and there are lot more possibilities to be explored in the coming fiscal year. The performance of this year’s IPOs would have a significant effect on the future course of IPOs.
INDIA INX LISTS IRFC GREEN BONDS Report by - Rajesh Khanna
The BSE’s India INX (India International Exchange) listed IRFC’s (Indian Railway Finance Corporation) green bonds on the global securities market on Saturday. These bonds have become first debt security to be registered on an exchange at International Financial Services Centre in Gujarat’s GIFT city. Railway Minister Piyush Goyal has announced that financial wing of Railway’s – IRFC will expand its path into newer business lines shortly. “India is the fastest developing economy in the world, and the need to raise funds is a continuous process. We have created a platform to tap global investors by issuing bonds in any currency a first of its kind in India”, he added. IRFC had last year raised USD 500M from its 10-year green bond from investors in Asia, Europe, and the offshore US through listing on the London Stock Exchange. The bonds will attract an annual yield of 3.835 percent.
An Year of IPO Boom
India INX lists IRFC green bonds
Tax notices to people investing in cryptocurrency as trading hits $3.5 billion
Some Key Points
The tax department has asked people investing in virtual currencies to pay tax on their capital gains. Bitcoin, the world’s biggest cryptocurrency soared more than 1700% last year reaching a record high of almost $20,000.
Contact Us Give us a call for more information about our services and products FIC Publishing FI Club (Publishing Div.) IIM Rohtak (+91) 94250-79893 fi@iimrohtak.ac.in Visit us on the web at www.iimrohtak.ac.in
Goyal further said that he has aggressive plans to monetize certain assets of Indian Railways, planning to change some existing directions on monetizing land and station assets. Government is also thinking of increasing lease period from 45 years to 99 years and allowing partaker to have multiple leases.
TAX NOTICES TO PEOPLE INVESTING IN CRYPTOCURRENCY AS TRADING HITS $3.5 BILLION Report by - Divyansh Singh
The government of India has sent notices to thousands of people who have invested in cryptocurrency after a nationwide survey showed that transactions of over $3.5 billion were done in last 17 months. These investors majorly constitute of tech-savvy youth, real estate players, and jewelers. Investments have been made in many cryptocurrencies including ethereum, ripple, and bitcoin which surfaced in reports from data collected from nine exchanges in Mumbai, Delhi, Pune, and Bangalore. This matter is expected to be discussed at G20 summit buy various policymakers as to how to how to regulate cryptocurrency trading. Comparing digital currency investments with “Ponzi schemes,” India has issued several warnings stating that they generate unusually high returns to early investors. But up till now, no strict actions have been taken to curb investments in an industry which is estimated to be adding 200,000 users every month. BR Balakrishnan who is the director general of investigations at the income tax department told Reuters that notices had been sent to the investors to assess the penetration and patterns of virtual currency trade. The tax department has asked people investing in virtual currencies to pay tax on their capital gains. They have also been asked about total holdings in these currencies and the source of funds in tax notice as seen by Reuters. It has been found that people are not reflecting it on their tax returns and in many cases investments are not accounted. Bitcoin, the world’s biggest cryptocurrency soared more than 1700% last year reaching a record high of almost $20,000. This is the reason, why global regulators got attracted to it to protect its investors from fraud. Already hundreds of investors have gone to police and courts complaining about fraud transactions in virtual currencies. In response to Ponzi scheme comment, Aman Kalra, marketing head of Coinsecure, a bitcoin exchange said that digital currency trading should not be labeled as such as they are nothing illegal. Considering cryptocurrencies are here to stay, the government must consider granting limited legality while ensuring that these are not used for crypto crimes.
FIC Publishing Division Finance and Investment Club IIM Rohtak MDU Campus, 124001