Business News at 10:00 am on 20th February, 2024

Let’s begin – The bid value of SpiceJet’s CMD, Ajay Singh and the majority shareholder of partner firm, Busy Bee Airways’, Nishant Pitti, for the bankrupt carrier, Go First is Rs 600 crore. The duo plan to pay off the dues of the banks by monetising two land parcel Go First has in Mumbai. Go First owes banks around Rs 6,521 crore, of which Rs 1,300 has been drawn under the government’s emergency credit line guarantee scheme. The total dues of the carrier after adding up the claims of vendors and lessors goes up to around Rs 11,463 crore. Sources said Singh and Pitti are confident that the valuation of the land parcel will cover part of the dues.

Up Next, Sajjan Jindal-led JSW Steel is in talks to acquire a 20% stake in a coal mine owned by Australia’s Whitehaven Coal, in a deal valued at $750 million-$1 billion. A number of other firms, including Japan’s Nippon Steel, are also in the race to acquire the Blackwater mine, located in Queensland’s Bowen Basin. Whitehaven Coal had announced plans to sell the stake in the metallurgical coal mine — the second-largest open-cut met coal producer in the region. The firm has set a mid-March deadline for the first round of bids. The name of the successful bidder would be announced on or after April 2.

Moving on – Large corporates will soon have a facility for “out-of-court” insolvency resolution that will hinge on informal discussions among the stakeholders and may not even require open bidding for selection of resolution applicants, official sources said. The scheme envisages minimal discretionary involvement by the National Company Law Board, but will differ from the extant “prepackaged scheme” for MSMEs in retaining the creditors as the initiators of the process. Under the pre-pack scheme, the debtor MSMEs are allowed to trigger their own bankruptcy processes, and the promoters can retain control of the firms during the resolution period. There was a plan to extend the debtor-led pre-pack scheme, but this has been dropped as the lenders’ community found it impractical

Meanwhile – Provisioning inadequate funds at start of a financial year and raising it to meet the requirement at revised estimate stage for the demand-driven Mahatma Gandhi National Rural Employment Scheme has become a practice in the last few years. For the current fiscal, an additional Rs 26,000 crore allocation at the RE stage in the interim Budget, from Rs 60,000 crore at the BE level, will still fall far short of meeting the anticipated demand unless workflow is regulated, going by the Ministry of Rural Development ministry’s estimate. As per a report of the parliamentary standing committee on rural development and panchayat raj, the MoRD sought an additional Rs 50,000 crore allocation in RE 2023-24 for the scheme.

In other news, The number of beneficiaries under the Pradhan Mantri Ujjwala Yojana, a scheme that aims at providing LPG connections with subsidy to poor households, has crossed 100.1 million, according to the latest data released by the Petroleum Planning and Analysis Cell. The government expects to extend the benefit to 103.5 million households under the scheme by 2025-26. However, this penetration still remains comparatively lower for the northeastern states with LPG coverage under the PMUY registering only a minimal growth of 5.5% over eight years of the scheme launch. At 33.5%, the eastern part of the country accounted for the highest percentage of PMUY connections.

A total number of resolution plans approved as of December 31 stood at 891, much higher than the 682 approved till FY23-end, the quarterly newsletter issued by the Insolvency and Bankruptcy Board of India said on Monday. This means, 209 resolution plans have been approved so far in FY24, which is higher than any other previous year. Earlier in October, IBBI Chairman Ravi Mittal had said that the number may reach 300 in the current fiscal. Last year, the plans approved were over 180. The newsletter, however, said that the average time taken for the closure of the CIRP as on December 31 was 671 days, far higher than 330 days mandated under the IBC.

“GIFT Nifty indicated that Indian equity indices BSE Sensex and NSE Nifty 50 may see a lacklustre opening on Tuesday. Stocks in Focus: GIFT Nifty traded up by just 8.50 points or 0.04% at 22,180 indicating a lacklustre opening for domestic indices NSE Nifty 50 and BSE Sensex on Tuesday. Previously, on Monday, the NSE Nifty 50 ended up by 81.55 points or 0.37% to settle at 22,122.25, while the BSE Sensex gained by 281.52 points or 0.39% to 72,708.16. The key stocks to watch in trade are Kotak Mahindra Bank, Mazagon Dock Shipbuilders, Whirlpool of India, CIE Automotive, Torrent Power, ONGC, LTIMindtree, Deepak Fertilisers & Petrochemicals, and Godrej Consumer among others.