CORPORATE UPDATE FOR 28TH OCTOBER 2015

CORPORATE UPDATE FOR 28th OCTOBER 2015

DIRECT TAXES   

India to apply 5% withholding tax to offshore rupee bonds
Oct 28, 2015
India will apply a 5 percent withholding tax to offshore rupee bonds for foreign investors, in line with the rate applied to domestic debt, Manoj Joshi, joint secretary at the country’s finance ministry, told reporters on Tuesday. The clarification comes amid some confusion about whether the withholding tax also applied to offshore debt. India had cut the tax for debt investments to the current rate from 20 percent in 2013, which will remain in effect until July 2017.

Source:https://economictimes.indiatimes.com/markets/bonds/india-to-apply-5-withholding-tax-to-offshore-rupee-bonds-official/articleshow/49551117.cms

INCOME TAX

Supreme Court ruling gives clarity on carrying forward tax losses 
Oct 28, 2015
In what could benefit companies making acquisitions and internal restructuring, a recent Supreme Court judgement has given clarity on whether tax losses could be allowed in the event of a change of shareholding beyond 51%. A problem that many Indian companies faced was the uncertainty on whether the buyer in a transaction — acquisition or restructuring of a group company — can add tax losses.

Source:https://economictimes.indiatimes.com/news/politics-and-nation/supreme-court-ruling-gives-clarity-on-carrying-forward-tax-losses/articleshow/49561126.cms

FINANCIAL MANAGEMENT

ADIA leads $265-m funding in ReNew Power
Oct 28, 2015
Sumant Sinha-promoted ReNew Power Ventures Pvt Ltd has raised $265 million of fresh equity funding from investors. The latest round of fund raising was led by Abu Dhabi Investment Authority (ADIA). ADIA has invested $200 million to join the list of ReNew Power’s investors.

Existing investors Goldman Sachs and Global Environment Fund have invested $50 million and $15 million, respectively, in the current round of funding.After the latest round of funding, the company has raised a total of $655 million of equity.

Of this, the largest is from Goldman Sachs with $370 million, ADIA will be the next largest investor with $200 million, Asian Development Bank has $50 million invested, while Global Environment Fund has invested $35 million.

Source:https://www.thehindubusinessline.com/markets/renew-power-raises-265-million-of-equity-funding/article7809466.ece

MISC.  BANKING

Axis Bank net profit up 19%
Oct 28, 2015
Axis Bank, India’s third largest private sector lender, reported a 19 per cent rise in net profit to Rs 1,916 crore for the July-September quarter against Rs 1,610 crore in the same quarter of the previous financial year. The net profit inched up on the back of higher net interest income and reduction in provisions.The net interest income, difference between interest earned and expended, increased 15 per cent to Rs 4,062 crore in the quarter ended September.

Source:https://www.businessstandard.com/article/companies/axis-bank-net-profit-up-19-115102700781_1.html

RBI

Short-term corp bonds: RBI hints at re-looking at ban on FIIs
Oct 28, 2015
RBI Deputy Governor H R Khan on Tuesday said the central bank could “take a bit of a chance” by allowing foreign investors to buy corporate debt of under-three-year residual maturity as its works towards deepening the nascent corporate debt market.”The present curb is only on residual majority (of short term corporate bonds) and we will look at whether some of the areas we can see because corporate debt is slightly different from G-secs, so we can take a little bit of chance and see which are the areas where we can do it,” he said addressing a capital market summit organised by Ficci here.

Source: https://www.businessstandard.com/article/finance/short-term-corp-bonds-rbi-hints-at-re-looking-at-ban-on-fiis-115102701178_1.html

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