Sebi clears MCX IPO proposal

Souece : PTI Sep 12 2011, Mumbai


Leading commodity exchange MCX today said market regulator SEBI has cleared its Draft Red Herring Prospectus for an initial public offer.


The clearance of the Securities and Exchange Board of India (SEBI) is valid for 12 months from now. The exchange has been asked to file offer document with stock exchange/ROC, a company spokesperson said here.


The Multi-Commodity Exchange of India (MCX) had filed DRHP with SEBI for an IPO of 6,427,378 equity shares of Rs 10 each through an offer for sale by existing shareholders.


The offer constitutes 12.60 per cent of the paid-up equity share capital of the company.


The offer will be through a 100 per cent book-building process, wherein not more than 50 per cent of the net offer will be allocated on a proportionate basis to qualified institutional buyers, not less than 15 per cent of the issue will be available to non-institutional bidders and not less than 35 per cent of the issue will be available to retail individual bidders.


The exchange has diverse shareholding pattern with international names like NYSE Euronext, Fidelity, Merrill and leading Govt institutions like SBI, Nabard, Corporation Bank.


Financial Technologies (India) Ltd, State Bank of India, GLG Financials Fund, Alexandra Mauritius, Corporation Bank, ICICI Lombard General Insurance Company and Bank of Baroda are the selling shareholders in the offer. FTIL (Promotors of MCX) holds 31 per cent before IPO and will dilute to 26 per cent.


Listing is expected to ensure the highest level of shareholder and public scrutiny, corporate governance and transparent trade practices, the official said.


The exchange paid dividend over 3.15 times that of equity since its inception.


MCX is the sixth largest commodity exchange in the world with No 1 in silver and No 2 ranking in gold. It would be the first exchange in India to go public and get India at par with other countries with listed exchanges such as the US, Hong Kong, the UK, Singapore, Japan and Australia.


Edelweiss Capital, Citigroup Global Markets India and Morgan Stanley India Company are the book running lead managers to the offer.

Carol Bartz resigns from Yahoo board

Source :Reuters : Sep 12 2011


Carol Bartz, who was fired as chief executive of Yahoo Inc last week, has




"On Sept. 9, 2011, Carol Bartz resigned from the board of directors of Yahoo! Inc., effective immediately," Charles Sipkins, a spokesperson for the board wrote in an e-mail on Sunday.


The news was first reported on Sunday in The Wall Street Journal.


Bartz was abruptly fired from her job as CEO on Tuesday. She had said that she planned to remain on the Internet company's board of directors, a statement that conflicted with that of a company spokesman who said Bartz would have to give up her board seat.


After being fired, Bartz gave an inflammatory interview to Fortune magazine in which she characterized Yahoo's board as "doofuses" who "fucked me over".

Hyderabad Angels set to close 3 funding deals

Source : Digital FC:B Krishna Mohan Sep 11 2011 , Hyderabad

 

Hyderabad Angels, a group of high networth individuals who pursue investment opportunities in start-up companies, will soon close funding deals in two or three companies.

The funding will be in the order of $ 1,00,000 to $ 5,00,000 in technology, energy and agri-based business in a month or so. However, the funding will be provided by individual members and not through the common platform.

“Every month about six to seven deals are put to the investment screening committee,” JA Chowdary, a member of Hyderabad Angels and executive ch­airman of Talent Sprint, which imparts training to engineering graduates to make them job ready, told Financial Chronicle.

“We are vertical agnostic. The proposals are coming in technology and energy areas. Mobile technology and internet too are seeing a lot of buzz,” he said. The companies coming for funding are not necessarily from Hyderabad.

Hyderabad Angels was formed about a year ago wi­th an objective to provide funding for start-ups and about 60 firms have angel investors. One member takes the lead to do the due diligence on profit margins, firm profile, market potential, team in place and other aspects of the pr­oposals after they are oka­yed by the investment scre­ening committee, he said.

Based on this information, other angel investors commit their investments in the venture in return for a stake in the company based on the valuation they arrive. There might be multiple investors investing in a same project.

“Many start-ups are not in a position to provide collaterals to the bank. Venture capitalists, as the funding model demands, are not attracted to the project unless the prototypes are ready and the revenue model is visible. Same is the case with private equity funds,” he said about the difficulty start-ups face in raising funds and the need for HA, which will also provide mentorship to start-ups.

“We are even open to funding even Rs 50 lakh for a venture,” he said.

Typically, the investment period is for three to five years and Angels exit when the company raises Venture capital or goes through a merger and acquisition process.

In March this year, HA members invested Rs 2 crore in Hyderabad-based custom RFID manufacturing company, Identis Private. Other members have invested similar amount in a Mumbai based solar energy company.

Recently, Indian Angel Network, a network of bus­iness angels which so far made investments in 24 firms and made full or partial exits from five companies, in a Series A funding invested under $1 million in a real estate group buying pioneer, GrOffr.c­om, to help the latter exp­and to other cities in India.

GrOffr’s competence lies in forming groups of buyers in any city so as to be able to get a better deal.

Another start-up, ZipD­ial, based in Bangalore, rec­eived Series A investment of over $800,000 from both Indian and US angel inve­s­tors, led by Mumbai Angels.

ZipDial’s patent-pending missed call concept offers varied services like polling, generating sales lead and more, according to Valeire Wagoner, chief executive office and one of the founders of Zipdial.

Large customers such as Proctor and Gamble, KFC with Pepsi, Sanofi-Aventis, Videocon have used Zipdial services for their campaigns.

Tipu Sultan’s gems to go for $1 million

Source :Bloomberg Sep 08 2011

Indian jewels and photographs by Robert Mapplethorpe are among items collected by a Scottish aristocrat that are estimated to sell for as much as $1 million.

Colin Tennant, who died last year, gained notoriety for the parties he hosted on Mustique in the Caribbean in the 1960s and 1970s. Princess Margaret, sister of the UK’s Queen Elizabeth, Mickand Bianca Jagger, and David Bowie were among the guests.

Tennant, who lived to be 83, sold his private island and moved to nearby Saint Lucia with his pet elephant, Boopa, in 1992. Newspapers described him as an eccentric socialite who collected widely and left his Indian-style “Beau House” to Kent Adonai, his locally born servant and elephant-keeper. Proceeds of the auction will benefit the Glenconner Estate, said Bonhams.

“The collection is a wonderful mix,” said Charlie Thomas, the Bonhams specialist in charge of the September 28 London sale. “There are serious academic pieces combined with fun lots.”

A gold pendant from the treasury of the Indian ruler Tipu Sultan, set with a 38-carat emerald, is valued at £80,000 ($127,600) to £120,000. It is the most expensive piece in the 225-lot sale, which may raise £650,000. Tipu was known as the “Tiger of Mysore” for his opposition to British rule. He was killed, and his treasury looted, at the Siege of Seringapatam in 1799.

Mapplethorpe photos of Princess Margaret and the Jaggers at an Indian costume party for Tennant’s 50th birthday in 1976 carry low estimates of £300 each.

 Tennant inherited 1 million pounds in 1963 on the sale of the family commodity trading business. He assumed the title Lord Glenconner when his father died in 1983.

Pair of cufflinks and a silver snuffbox, both gifted by the princess to Tennant, are catalogued at £1,000 to £1,500 each. A late 17th-century marble bust symbolizing America is priced at £3,000 to £5,000.

HDFC Bank launches 'Swift' loan

Source :PTI Sep 09 2011 , New Delhi
Tags: HDFC Bank, 
Private sector lender HDFC Bank has launched personal loan 'Swift', a product that is 
processed in 24 working hours of receiving complete loan document.


Using cutting-edge imaging solution technology, the bank will now set the pace in this product category and ensure that loan processing will start the moment a customer steps into a branch in the morning and be complete in 24 hours, HDFC Bank said in a statement.


Swift will soon be available to all customers who hold salary accounts with the bank in 25 select branches across the country, keeping in mind customers' need for instant solutions to their financial needs, it said.

Final norms on new bank licences after amending Banking Bill

Source :PTI Sep 11 2011 , New Delhi






India needs to tweak norms to grant bank licences to corporates: RBI
to corporates only after 

Parliament approves the Banking Laws (Amendment) Bill, 2011.

The final guidelines on new banking licences would be released only after the necessary amendments to the Banking Laws (Amendment) Bill, which seeks to give more power to the regulatory powers of the RBI, sources said.

The central bank had last month issued the draft guidelines which pegged the minimum capital needed to set up a commercial bank by a corporate house having successful track record of 10 years at Rs 500 crore.

It is to be noted that the Banking Laws (Amendment) Bill was introduced in Parliament in March this year.

Sources added that empowering the RBI is essential for obtaining information about the other businesses of the corporate houses seeking banking licences in order to protect depositors' interests.

Banking companies are engaged in multifarious activities through the medium of associate enterprises. It has, therefore, become necessary for the Reserve Bank, as the regulator of the banking companies, to be aware of the financial impact of the business of such enterprises on the financial position of the banking companies, sources said.

It is, therefore, proposed to confer power upon the RBI to call for information and returns from the associate enterprises of banking companies also and to inspect the same, sources added.

The amendment seeks to allow the RBI to supersede the board of a banking company for a total period not exceeding 12 months.

The proposed amendment moved by the government also exempts mergers and acquisitions in the banking sector from the scrutiny of the Competition Commission of India.

According to the draft guidelines, companies which are primarily engaged in the real estate or stock broking will not be eligible for promoting bank.

"Entities or groups having significant [10 per cent or more] income or assets or both from real estate, construction and broking activities individually or taken together in the last three years will not be eligible to set up new banks," the draft said.

On foreign holding, it said the aggregate non-resident shareholding in the new bank should not exceed 49% for the first five years.

At present, the foreign shareholding in private sector banks is allowed up to 74% of the paid-up capital.

Credit bureau keeps tabs on your debt repayments

Source : By R Srividhya :DigitalFC:Sep 11 2011

A poor record can mar your chances of obtaining a loan

One of the important signs of a mature financial market is the presence of active credit information services bureaus that provide vital information on credit behaviour of consumers to banks and financial institutions to help them take a decision on credit provision.

The sign that India has arrived as an important financial services market is evident from the huge plans that the three major global credit information companies in the world, Experian, TransUnion and Equifax, have for the Indian market.

What does a credit bureau do?

A credit information bureau works by collecting data from various banks and financial institutions on consumer and commercial borrowers. The data collected is shared with member institutions as and when they need information on the previous credit history of the borrower or for designing new products or to study consumer behaviour pattern.

Apart from banks and non-banking financial companies (NBFCs), credit bureaus also collect and share information with housing finance companies, credit card companies and state financial corporations.Information like PAN number, permanent address and phone number are usually used to identify a customer and link it across to his different credit transactions

Credit bureaus in India: The oldest and largest credit bureau in India is Cibil, which has credit information from various banks and financial institutions right from the year 2000. The leading credit information bureau, TransUnion has a 20 per cent stake in Cibil, which launched operations in 2004.

 Cibil, which has a data-sharing agreement with more than 600 banks and financial institutions, is the only one to provide a consumer credit score, apart from providing a detailed consumer credit report.

Experian, which entered India just last year, provides basic credit information services, mostly for corporate customers. “India is an important strategic market for us. We have plans of getting into consumer credit information area whenever the time is more appropriate,” says Mohan Jayaraman, who recently took over as managing director of Experian India.

The other leading global credit information bureau, Highmark Credit Information Services, is present in India through its credit bureau for the micro-finance industry.

Equifax Credit Information Services, which is a joint venture between Equifax and six leading financial institutions, also provides credit risk and analytics services.

How is credit information used?

 For retails customers, the credit scores and reports are useful in bargaining for better interest rates when seeking a new loan. By paying a small sum, retail customers can avail their credit report and credit scores from the credit information agency. 

Banks also use the credit information report to check information like the credit worthiness of the customer. “Our Cibil credit scores are usually in the range of 300-900, with the lowest indicating the high risk involved in lending to the customer.

 A person with a credit score of 800-850 is considered a good customer who is likely to repay the loans on time,” points out Arun Thukral, managing director, Cibil.

Credit bureaus in developed markets: In developed markets like the US and in parts of Europe, credit bureaus provide more value-added services such as identity theft insurance, security freeze, which prevents one’s credit report being reported to third parties, except those permitted by law and market analytics that helps study consumer credit pattern.