#1. Market and banking regulators keeping a close watch on a spike in derivative trading volumes
India’s banking and stock market regulators are monitoring the high volume of trading in the futures and options segment and have held discussions under the aegis of the Financial Stability and Development Council, Reserve Bank of India governor Shaktikanta Das said, the Mint reported. Turnover in derivatives grew 23-fold over the past five years to reach Rs 79,927 lakh crore at the end of March, NSE data showed.
Why it’s important: Trading volumes in equity derivatives are now larger than India’s nominal GDP. The surge has sparked concerns among market participants and watchdogs alike.
#2. More multinationals look at India market listing after IPO move by Hyundai Motors
Hyundai Motor Company’s plan to list its India arm may prompt more MNCs to consider listing their India arms, the Business Standard reported, citing investment bankers. There are early discussions with about half a dozen MNC firms exploring options to list in India to unlock value. The valuations offered in the Indian market are at least 2-5 times higher than those in Korea, Russia, and Europe.
Why it’s important: The interest by MNCs could be because Indian markets provide high valuation and robust liquidity. Whether the interest translates into action would depend on how the Hyundai IPO fares.
#3. TPG Capital leads the race to acquire a 60 percent stake in Altimetrik at a $1.5 billion valuation
TPG Capital has emerged as the lead contender for about 60 percent of Michigan-based digital services company Altimetrik owned by Indian American serial entrepreneur Raj Vattikuti, the Economic Times reported. The firm is being valued at $1.5 billion (Rs 12,500 crore). TPG’s Asia investment platform TPG Capital Asia has signed an exclusivity agreement with the promoters. Jefferies is advising the promoter.
Why it’s important: More than 80 percent of Altimetrik’s staff is based in India and the digital services firm operates in over 20 countries. If the transaction goes through, it would be TPG Capital’s debut buyout in India’s IT-enabled services space.
#4. Dr Reddy's, Warburg Pincus, and EQT frontrunners to acquire Bharat Serum and Vaccines
Dr Reddy’s Laboratories and global private equity firms EQT and Warburg Pincus are frontrunners for acquiring Advent’s stake in biopharmaceuticals firm Bharat Serums and Vaccines, the Business Standard reported. Mankind Pharma is also in the fray but is taking a more conservative approach to valuation.
Why it’s important: There has been considerable deal activity in India’s healthcare and pharma sectors on expectations of rapid growth. Advent International is looking to exit the firm four years after it picked up a majority stake.
#5. Corporate India lobbies for a simplified regime for capital gains tax in the Union budget
India Inc. would like the government to make the capital gains tax regime simple, consistent, and rational in the upcoming federal budget, the Hindu Businessline reported. Industry leaders also called for a status quo on the corporate tax rates and changes in the personal income tax slabs to boost consumption.
Why it’s important: Past policy decisions have led to a complex structure in the capital gains regime, which can be made simpler. Consumption demand has been muted in India, which can get a boost by providing the middle- class with a higher disposable income.
#6. Business families seek advice on modifying tightly written deeds of family settlements
An increasing number of business families are asking legal advisors and experts for advice on possible amendments to tightly written Deeds of Family Settlement designed to safeguard inheritances in an age that didn’t envisage the prospect of members going abroad or venturing into segments that were non-existent at the time, the Economic Times reported.
Why it’s important: Changing times call for more fleshed-out trust deeds that safeguard inheritance. Business families are now keen on protecting wealth rather than just the management of wealth.
#7. Indian companies raise debt through unlisted arms to avoid compliance burden
Companies with publicly traded bonds planning to sell fresh non-convertible debt have to mandatorily list them on stock exchanges under a new rule that took effect earlier this year, which has prompted them to raise debt through unlisted subsidiaries, the Mint reported. The capital raised can then be transferred to the parent through inter-company loans or other mechanisms.
Why it’s important: The new regulation to boost transparency in India’s corporate bond market is not panning out as planned. It might even push investors and issuers to voluntarily delist existing listed NCDs or turn to other sources or avenues of fund-raising.
#8. Highways authority to offer 15 road projects worth Rs 44,000 crore under BOT mode
The National Highways Authority of India plans to offer 15 road projects worth Rs 44,000 crore and covering 900 km for bids under the build-operate-transfer mode in the current financial year, the Economic Times reported. The 15 projects are a part of the government’s plan to offer 53 projects worth over Rs 2.2 lakh crore covering a route length of 5,200 km under the BOT mode over the next 3-5 years.
Why it’s important: If the fresh BOT is successful, it could mark the comeback of projects under public-private partnership in highways. The government has already modified the model concession agreement to make it attractive for private companies to invest in road construction.
#9. GST Council may reconsider retrospective taxation on online gaming companies
The GST Council in its meeting on Saturday is expected to discuss a key amendment to the central GST Act that will give both the Centre and states the power to waive GST dues that have not been paid due to legal ambiguity or on account of general practices consistently followed by businesses.
Why it’s important: If the amendment is followed through, it can potentially resolve the vexatious issue of retrospective taxation for online gaming companies.
#10. India's top software companies are office space on falling headcount and hybrid work
The Mint reported that office real estate is shrinking at some of India’s top IT companies as hybrid work and falling headcounts reduce the requirement for sprawling spaces. Cognizant, Infosys, and Wipro saw their real estate footprint shrink last year, ending the previous financial year with 103.2 million sq. ft of office space, down 3.7 percent from 107.25 million sq. ft a year earlier.
Why it’s important: The development follows a similar scenario in Western countries that saw many empty offices as working methods changed after the pandemic. The shrinkage could see a price decline in commercial properties.
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