Episode 357

Business News at 09:30 am on 24th January 2023

Listen to the latest news on buisness and finance where we talk about Securities Appellate Tribunal’s stand on the National Stock Exchange, Apple’s global production shifting to India, special economic zones Act, Vistara net profit. We also talk about the economy.

Today’s Latest Business News at 09:30 am on 24th January 2023.

[Disclaimer: This transcript is auto-generated]

The Securities Appellate Tribunal on Monday set aside the `624 crore disgorgement order against the National Stock Exchange of India by the Securities and Exchange Board of India. NSE has been directed to deposit `100 crore for lack of due diligence to the Investor Protection and Education Fund created by Sebi. The tribunal, however, upheld the direction given by Sebi to prohibit NSE from accessing the securities market for six months and carry out system audits at frequent intervals after thorough appraisal of the technological changes introduced from time to time is affirmed. The direction of Sebi’s whole time member directing NSE to initiate enquiry against its employees was also affirmed. The tribunal also set aside the direction to disgorge 25% of salary from Ravi Narain and Chitra Ramkrishna, founder members and former chiefs of the exchange, as well as the direction to prohibit the duo from associating with any listed company or a market infrastructure institution or any other market intermediary for five years, substituting it for the period undergone by them.

Moving to another news, Apple may shift a quarter of its global production to India from 5-7% now, commerce and industry minister Piyush Goyal said on Monday, showcasing the tech giant’s plan as a sign of the country’s emerging strength as a global manufacturing base. “They launched the most recent models from India, manufactured in India,” the minister said at the inaugural session of the B20 India Inception Meeting, organised by the Confederation of Indian Industry here. He added, quote, “If I am not mistaken, they are targeting to go up to 25% of their manufacturing,” unquote. The minister, however, did not specify the timeframe by which the California-based firm will expand its production facility in India. Apple has been assembling its flagship iPhone 14 in India since 2017. It is setting up its largest manufacturing unit in the country in Hosur near Bengaluru. Its plan to scale up manufacturing in India is in consonance with the strategy to diversify more of its supply chain away from China.

Speaking on economy, The introduction of a proposed Bill in Parliament to replace the special economic zones Act could see further delay, as the commerce and the finance ministries are still in the process of finding a common ground on tax incentives and some other key provisions of the draft Bill. People close to the development told Financial Express that the Bill is unlikely to be tabled in the upcoming Budget session of the Parliament, as was anticipated. In fact, the commerce ministry was initially planning to introduce the Development of Enterprise and Services Hub Bill in the winter session of the Parliament, which got over on December 23. The Budget session is scheduled from January 31 to April 6, with a near one-month recess in between.

Meanwhile, Buoyed by a record number of passengers, Vistara has claimed to have generated net profits during the December quarter at the operating level making it a first in its 9 years of operation. However, this was excluding foreign currency loss and non-operating income. Overall, Vistara remained in the red during the December quarter taking. Without disclosing the absolute profit numbers, Vistara added that its revenues during the April-December period surpassed $1 billion. At 3.3 million, Vistara carried the highest number of passengers in a quarter in its lifetime. This comes on the back of record losses of `2,031 crore reported by the full-service carrier during Financial Year 22, which was 35% higher than Financial Year 21. It, however, grabbed the position of second largest airline by market share for Financial Year 22 behind IndiGo. It operates close to 8,500 flights per month.

Lastly, the concessional corporate tax rate of 22% introduced in 2019 is still to be chosen by large sections of India Inc. This is because many companies, including large ones, find either the Minimum Alternate Tax regime or higher corporate tax rates of 25% or 30% coupled with exemptions and incentives more attractive, in the final analysis. Another deterrent is that opting for the concessional regime is irreversible and companies cannot move back to the old regime again, in case they plan any expansions in the future and wish to take advantage of any deductions. According to official data, of the 0.92 million corporate returns filed in 2019-20, 0.145 million firms with income of Rs 9.33 trillion opted for the 22% tax rate. In a bid to promote growth and investment, the government had in 2019 slashed the corporate tax rate to 22% for domestic companies, provided they do not avail any exemption or incentive. They would also not have to pay Minimum Alternate Tax, which is currently applied at 15% on book profits

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Business News at 09:30 am on 24th January 2023