RBI cuts FY17 growth forecast to 6.9%, pegs 7.4% for next yr

 The Reserve Bank today kept key interest rates unchanged saying it wants to assess how the transitory effects of demonetisation on inflation and the output gap play out. |  RBI cuts FY17 growth forecast to 6.9%, pegs 7.4% for next yr RBI Governor Urjit Patel today cut the economic growth forecast to 6.9 percent for the current fiscal from 7.1 percent estimated earlier, even as he said the economy will bounce back to 7.4 percent rate next fiscal. The Reserve Bank today kept key interest rates unchanged saying it wants to assess how the transitory effects of demonetisation on inflation and the output gap play out. "GVA (gross value added) growth for 2016-17 is projected at 6.9 percent with risks evenly balanced around it. Growth is expected to recover sharply in 2017-18 on account of several factors. GVA growth for 2017-18 is projected at 7.4 percent, with risks evenly balanced," the RBI said in its 6th bi-monthly monetary policy statement. In its last monetary policy on December 7, the central bank had cut growth forecast to 7.1 percent, from its earlier projection of 7.6 percent for this fiscal. The apex bank said that discretionary consumer demand held back by demonetisation is expected to bounce back in the closing months of 2016-17. Economic activity in cash-intensive sectors such as retail trade, hotels and restaurants, transportation as well as in the unorganised sector is expected to be rapidly restored, the RBI said

Infosys may consider Rs 12,000 crore share buyback: 

 In a sign of the troubled times that the Indian IT sector has been going through, the management of Infosys may consider the option of a share buyback, according to people close to the IT major. The size of the share buyback could be a mammoth Rs 12,000 crore. Nisha Poddar (more) Correspondent, No playable sources found In a sign of the troubled times that the Indian IT sector has been going through, the management of Infosys may consider the option of a share buyback, according to people close to the IT major. The size of the share buyback could be a mammoth Rs 12,000 crore. Currently, Infosys has about Rs 38,000 crore cash on its books. While Infosys refrained to comment on the report terming it a “market speculation”, Deepak Shenoy of Capital Mind told that rewarding shareholders through a buyback is the best option to generate cash. IT companies are facing global headwinds from events such as US President Donald Trump’s policies and his stance on H-1B visas. Last week, a new bill, proposing to more than double the minimum wages to USD 130,000 for foreigners working in the US under the H-1B visa, was tabled in the House of Representatives. The proposed changes in the visa regime may result in higher operational costs and shortage of skilled workers for the USD 110 billion Indian outsourcing industry Infosys may consider Rs 12,000 crore share buyback: Sources 

Infosys founders raise governance concerns with board: 

Sources In an indicator of discontent brewing at Infosys, its founders including NR Narayana Murthy, Kris Gopalakrishnan and Nandan Nilekani have raised with its board concerns over the governance of the company, according to people privy to the developments at IT major. Error loading player: No playable sources found Chaitanya Gudipaty In an indicator of discontent brewing at Infosys , its founders including NR Narayana Murthy, Kris Gopalakrishnan and Nandan Nilekani have raised with its board concerns over the governance of the company, according to people privy to the developments at IT major. Governance concerns In a letter to Infosys board in January, the founders had raised fresh concerns over governance, had suggested bringing in value-based people into the firm. More importantly, they had questioned the compensation

Emami Infrastructure's board meeting on February 10, 2017 

Emami Infrastructure Ltd has informed BSE that a meeting of Board of Directors of the Company will be held on February 10, 2017, inter alia, to consider, approve and take on record the Un-audited Financial Results for the 3rd quarter and nine months ended December 31, 2016. |  Emami Infrastructure Ltd has informed BSE that a meeting of Board of Directors of the Company will be held on February 10, 2017, inter alia, to consider, approve and take on record the Un-audited Financial Results for the 3rd quarter and nine months ended December 31, 2016.Further, as per the Company's Code of Conduct to Regulate, Monitor and Report Trading by Insiders, the Trading Window of the Company for dealing in the securities of the Company shall remain closed from February 03, 2017 to February 12, 2017 (both days inclusive). 

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Only 54% of land title documents digitised so far in Maharashtra

 Only 54% of the total 2.5 crore 7/12 receipts (a land title document) in Maharashtra have been digitised so far, a state government said. Maharashtra’s revenue minister Chandrakant Patil, in December 2016, had announced R Only 54% of the total 2.5 crore 7/12 receipts (a land title document) in Maharashtra have been digitised so far, a state government said. Maharashtra’s revenue minister Chandrakant Patil, in December 2016, had announced that digitisation of all 7/12 receipts will be completed by March 31, 2017. However, going by the current pace, it is highly unlikely that the state will be able to do so. Maharashtra to have digitally signed 7/12 receipts from March 2017 “There have been a number of challenges, including poor internet connectivity, lack of skilled manpower and non-availability of infrastructure, to carry out the drive. There have been efforts to push the digitisation but other factors are affecting the progress of the project,” said an official, on the condition of anonymity

 The 7/12 receipt is a crucial piece of document for the establishment of ownership of a land. The receipt is extensively used by farmers, for loan agreements, crop survey and availing government facilities. Till some years ago, hand-written 7/12 receipts were prepared by the village-level revenue officers (Talathi). Only Talathis are entrusted with the powers to make changes in these receipts and this resulted in several instances, wherein officers misused their authority. To avoid this, the state government had come up with an idea of digitisation of entire revenue documents. The aim is also to boost transparency and avoid any tampering with documents. The state government has made several provisions, including setting up optical fibre networks, providing high-speed internet connection and asking Talathis to use laptops instead of pen and paper, for issuing 7/12 receipts to needy people. We may miss the deadline but we will achieve it for sure, the official assured. 

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Union Budget 2017-18: Jaitley tightens screws on money launderers using 

stock market From April 1, 2018, only those investments in equities will be eligible for long term capital gains, where securities transaction tax (STT) has been paid. In other words, only shares bought through the stock exchange platform will be eligible for long term capital gains tax. The Finance Ministry has tweaked the rules relating to long term capital gains tax to make it harder for high networth individuals who launder black money through fake long term capital gains. At present, gains on equity investments held for more than a year are not subject to capital gains tax. From April 1, 2018, only those investments in equities will be eligible for long term capital gains, where securities transaction tax (STT) has been paid. In other words, only shares bought through the stock exchange platform will be eligible for long term capital gains tax. However, shares acquired in initial public offerings, follow-on public offerings, bonus issue, rights issue and FDI route, where the shares are directly credited to the investors’ demat accounts will be exempt from this rule. “It has been noticed that exemption provided under section 10(38) is being misused by certain persons for declaring their unaccounted income as exempt long-term capital gains by entering into sham transactions,” the Budget memorandum says. 

 “With a view to prevent this abuse, it is proposed to amend section 10(38) to provide that exemption under this section for income arising ng on transfer of equity share acquired or on after 1st day of October, 2004 shall be available only if the acquisition of share is chargeable to Securities Transactions Tax,” the memorandum says. The modus operandi of tax evasion through fake long term capital gains works thus: Say investor X has undisclosed income on which he wants to avoid tax. He gets in touch with company Y which can help generate fake long-term capital gains. Company Y issues shares at Rs 10 each and makes a preferential allotment to X. The shares are directly credited to the demat account of X. The money which Y gets from X for the shares is routed back through a web of companies to X. A year later, entities associated with Y manipulate the stock price and double the price to Rs 20. X sells his shares to these entities, who play the role of exit providers, on the stock exchange and gets the payment for it in cheque. X then pays an equivalent amount to the exit providers in cash. Recently, capital and commodities markets regulator 


SEBI had written to the Directorate of Income Tax saying that it cannot impound or disgorge gains generated by entities trying to launder undisclosed income through stock market transactions. The I-T department had flagged off some 32,000 entities to SEBI, saying they were evading taxes by faking long term capital gains. SEBI said that tax evasion was outside the purview of its regulations. Another reason the regulator could not disgorge the profits is that no common investor was been adversely impacted by the bogus trades. SEBI can only take action where it can prove that the stock prices had been manipulated. Since the last leg of the fake capital gains transaction happens in cash, it is hard for the regulator to prove the fraudulent nature of the deal Union Budget 2017-18: Jaitley tightens screws on money launderers using stock market From April 1, 2018, only those investments in equities will be eligible for long term capital gains, where securities transaction tax (STT) has been paid. In other words, only shares bought through the stock exchange platform will be eligible for long term capital gains tax. | 


 The Finance Ministry has tweaked the rules relating to long term capital gains tax to make it harder for high networth individuals who launder black money through fake long term capital gains. At present, gains on equity investments held for more than a year are not subject to capital gains tax. From April 1, 2018, only those investments in equities will be eligible for long term capital gains, where securities transaction tax (STT) has been paid. In other words, only shares bought through the stock exchange platform will be eligible for long term capital gains tax. However, shares acquired in initial public offerings, follow-on public offerings, bonus issue, rights issue and FDI route, where the shares are directly credited to the investors’ demat accounts will be exempt from this rule. “It has been noticed that exemption provided under section 10(38) is being misused by certain persons for declaring their unaccounted income as exempt long-term capital gains by entering into sham transactions,” the Budget memorandum says. “With a view to prevent this abuse, it is proposed to amend section 10(38) to provide that exemption under this section for income arising ng on transfer of equity share acquired or on after 1st day of October, 2004 shall be available only if the acquisition of share is chargeable to Securities Transactions Tax,” the memorandum says. 


 The modus operandi of tax evasion through fake long term capital gains works thus: Say investor X has undisclosed income on which he wants to avoid tax. He gets in touch with company Y which can help generate fake long-term capital gains. Company Y issues shares at Rs 10 each and makes a preferential allotment to X. The shares are directly credited to the demat account of X. The money which Y gets from X for the shares is routed back through a web of companies to X. A year later, entities associated with Y manipulate the stock price and double the price to Rs 20. X sells his shares to these entities, who play the role of exit providers, on the stock exchange and gets the payment for it in cheque. X then pays an equivalent amount to the exit providers in cash. Recently, capital and commodities markets regulator SEBI had written to the Directorate of Income Tax saying that it cannot impound or disgorge gains generated by entities trying to launder undisclosed income through stock market transactions. The I-T department had flagged off some 32,000 entities to SEBI, saying they were evading taxes by faking long term capital gains. 

SEBI said that tax evasion was outside the purview of its regulations. Another reason the regulator could not disgorge the profits is that no common investor was been adversely impacted by the bogus trades. SEBI can only take action where it can prove that the stock prices had been manipulated. Since the last leg of the fake capital gains transaction happens in cash, it is hard for the regulator to prove the fraudulent nature of the deal

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Nifty to open flat led by mixed global cues:

 ICICIdirect According to ICICIdirect, Nifty is likely to open flat on the back of mixed global cues. |ICICIdirect.com | ICICIdirect's Derivative Report: Nifty The Nifty opened flat ahead of Union Budget 2017. However, a better-than-expected outcome from the Budget led to a one-sided rally. Towards the end, the index managed to end well above 8700 adding 155 points. Nifty futures settled at a premium of 22 points. India VIX fell 17 percent to 13.9. FIIs bought Rs 93 crore while DIIs bought Rs 1134 crore in the cash segment. FIIs bought Rs 119 crore in index futures and Rs 2210 crore in index options. In stock futures, they sold Rs 447 crore. The highest Put base is at the 8400 strike with 46 lakh shares while the highest Call base is at the 9000 strike with 61 lakh shares. The 8800 and 9000 Call strikes saw additions of 7.3 and 5.4 lakh shares, respectively, while 8700 and 8600 Put strikes saw additions of 7.0 and 6.9 lakh shares, respectively.

Nifty Bank Nifty Bank saw huge addition in open interest and ended well above 20100 clearly indicating long participation. As the index has closed above the sizeable Call base of 20000, the overall trend is likely to continue. It is well placed to test 20200. Nifty Future: The Nifty is likely to open flat on the back of mixed global cues. Buy Nifty in the range of 8665-8675 for targets of 8725-8745, stop loss: 8645. Nifty Bank Future: Nifty Bank saw huge addition in open interest and ended well above 20100 clearly indicating long participation. As the index has closed above the sizeable Call base of 20000, the overall trend is likely to continue. It is well placed to test 20200. Buy Nifty Bank in the range of 19950-20000, targets: 20100-20200, stop loss: 19870. Disclaimer: The views and investment tips expressed by investment experts  are their own, and not that of the website or its management. advises users to check with certified experts before taking any investment decisions

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