Sebi's stewardship code for mutual funds and alternative investment funds lays down six principles to improve corporate governance standards in their investee companies, reports Jash Kriplani.
Market experts say that FIIs have been caught off-guard on their exposures to companies with high-leverage and those facing cyclical headwinds.
Exchanges will have to facilitate a more direct interface between clients and the clearing corporation, bypassing intermediaries such as brokers, under this new proposed framework.
The asset manager is yet to resolve the impasse surrounding the payment of pension to its erstwhile employees who had opted for voluntary retirement in 2003.
The IPO is an offer for sale of 38 million shares by SBI, BOB, LIC, PNB and T Rowe Price. Barring T Rowe and PNB, the others are selling stake to comply with Sebi norms.
Equity MF schemes recorded worst inflows in three and a half years at Rs 1,311 crore for November. Investors across the board have taken money off the table as markets have scaled new highs. Industry experts said SIPs had stayed intact, which is a healthy sign for the MF industry.
The financial services sector, including NBFCs and housing finance companies (HFCs), have historically been the largest borrowers from MFs.
An infusion of capital would come as a much-needed relief for the bank, with its capital adequacy ratio barely above the regulatory requirements, as of June disclosures.
Market watchers believe that the change in guidelines fly in the face of some of the recent initiatives taken by the government, such as easing norms for foreign portfolio investors.
This may mean easier access, simplified KYC and documentation requirements, and fewer investment restrictions for a majority of FPIs, especially broad-based funds and pooled vehicles that were earlier part of Category-II.
Experts say the trend is worrying as it could take a toll on the pace of equity flows and also hinder the penetration drive of the Rs 24-trillion MF industry.
In the year to date, 61 PSUs have lost an average of 22 per cent, with five companies losing more than half their share value. The BSE PSU index is down 10.6 per cent.
Ninety-nine companies, which also include some unlisted ones, have more than Rs 100 crore each of minimum alternate tax credit on their books, cumulatively adding up to Rs 75,000 crore. By utilising MAT credit, many companies will be able to bring down their effective tax cost.
In September, net equity inflows stood at Rs 6,609 crore, compared to Rs 9,152 crore in the previous month. In the last four months, this is the lowest net inflow tally seen by the equity category.
The number of equity schemes rose to 562 from 519 two years ago. Equity NFOs, in fact, have mopped up more than Rs 16,000 crore since 2018 - 2.7 times the Rs 5,948 crore collected in the preceding three calendar years.
In an interaction with Jash Kriplani, A Balasubramanian, managing director and chief executive officer, Aditya Birla Sun Life Asset Management Company, shares his optimism on what makes him believe that these cuts can help in addressing multiple issues plaguing the economy, without letting fiscal deficit pose any major risk.
Market sources said other brokerages are also looking to streamline their business models as market volatility, along with increasing competition, has taken a toll on earning yields.
The capital markets regulator exonerated former employees Subramanian Anand, Ravi Apte, and Umesh Jain, with respect to charges levelled against them.
This is not the first time that users of Zerodha clients have faced technical issues. As recently as February, 2019, the platform faced a connectivity issue that led to a pile-up of orders.
The RBI governor's assurance should give investors enough confidence to start believing in the NBFC sector again, say bankers.
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