Vaccine makers meet WTO D-G, flag excess capacity of Covid-19 jabs

 Some manufacturers also said that the regulatory approval framework for Covid-19 vaccines in other nations also takes a substantial amount of time

In a meeting with World Trade Organization (WTO) Director-General Ngozi Okonjo-Iweala, the country's top vaccine manufacturers on Thursday raised concerns regarding the excess capacity of Covid-19 jabs created during the pandemic.

"With the outbreak of the pandemic, vaccine manufacturers have rapidly created capacities to meet demand. Going ahead, manufacturers are concerned about excess capacity and how it can be utilized," said a person in the know, adding that similar concerns have been raised by manufacturers of other countries as well.

Okonjo-Iweala, who is on a three-day visit to the national Capital, met key industry leaders, including vaccine makers, such as Bharat Biotech Managing Director (MD) Suchitra Ella, Panacea Biotech MD Rajesh Jain, and Biological E Chief Operating Officer Lakshminarayana Neti, among others.

Some manufacturers also said that the regulatory approval framework for Covid-19 vaccines in other nations also takes a substantial amount of time.

They urged the D-G if the WTO could help in ways to reduce delay.

Vaccine makers are concerned about optimal utilization of excess capacities created during the pandemic.

Ella raised similar concerns at a Federation of Indian Chambers of Commerce & Industry event on Thursday, and pointed out that when the Covid-19 pandemic is gone, what would happen to the excess capacities created.

“The excess capacities, manpower recruited... what happens? How many companies will be able to sustain it? It will be a global challenge,” said Ella, adding, “Today we want more production, tomorrow who will want that excess production?”

UV Asset Reconstruction Company submits bid to buy IFIN's bad loans

 Sale to help IL&FS clean its financial services arm book

UV Asset Reconstruction Company (ARC) has submitted a bid to buy 62 non-performing accounts worth Rs 4,300 crore from IL&FS subsidiary, IL&FS Financial Services (IFIN).

According to the Reserve Bank of India (RBI) regulations, IFIN has initiated the Swiss challenge method to give an opportunity to the higher bidder of the earlier round, ARCIL, to match the fresh bid by UV ARC. The winner from the Swiss challenge is likely to be announced soon. The bids for IFIN’s bad loans sale had closed on Tuesday. The potential transaction would be conducted on a full upfront cash consideration basis.

"As the bid was under Swiss challenge, there is an RBI approved process which is underway before H1 can be declared," an IL&FS spokesperson said.
The sale will help IL&FS clean up the books of its financial services arm, which had a large portfolio of bad loans. Banks have already classified loans to IFIN as fraud after its parent firm IL&FS collapsed under a massive debt of Rs 99,000 crore.

The new board of IL&FS said in July this year that it will be able to recover Rs 58,000 crore, or 95 percent of its recovery target, by the end of the current fiscal year.

For both UV ARC and ARCIL, the acquisition of IFIN’s bad loan portfolio will help them increase their market share. IFIN had granted loans to various group companies of IL&FS apart from lending to outside parties.

UV ARC had won the mandate to bag two telecom companies, Reliance Communications, and Aircel after both companies were sent to the National Company Law Tribunal (NCLT) for debt resolution. But the RBI later clarified that the ARCs cannot participate in the Insolvency and Bankruptcy Code process.

PSBs may get capital support in Q4 to meet regulatory requirements

 The capital position of banks will be reviewed in the next quarter for infusion requirement

The government is likely to pump capital in public sector banks during the last quarter of the current financial year to meet the regulatory requirements.

The government in the Budget 2021-22 has made an allocation of Rs 20,000 crore for the capital infusion in the state-owned banks.

The capital position of banks would be reviewed in the next quarter, and depending on the requirement, the infusion will be made to meet the regulatory needs.

In the current fiscal so far, all 12 public sector banks have posted a profit, which is being plowed back to bolster the balance sheet of the banks, sources said.

Going forward, they said, the rise in stressed assets would determine capital requirement. If numbers are anything to go by, the sources said, the financial health of public sector banks is showing gradual signs of improvement across the spectrum.

Last month, the Reserve Bank removed UCO Bank and Indian Overseas Bank from prompt corrective action framework (PCAF), following improvement in various parameters and a written commitment that the state-owned lender will comply with the minimum capital norms.

However, the only public sector lender left under the PCA framework is the Central Bank of India.

Indices decline for third straight day amid concerns over economic recovery

 Investors turn jittery over high valuations, inflation

India’s benchmark indices declined for the third consecutive day on Thursday, led by losses in index heavyweights Reliance, Infosys, and TCS, amid investors’ concerns over high valuations and the impact of inflation on corporate profits and economic recovery. A rally in banking shares helped offset some losses.

After dropping as much as 774 points, the Sensex ended the session 336 points, or 0.5 per cent, lower at 60,923, while the Nifty fell 89 points to close at 18,178. In the last three sessions, the Sensex has declined 842 points, or 1.4 per cent, while the Nifty has dropped 299 points or 1.6 per cent. The Nifty Midcap 100 and the Nifty Smallcap 100, on the other hand, have plunged close to 6 per cent in three days.

Domestic institutional investors (DIIs) have sold shares worth about Rs 9,000 crore in the last nine trading sessions. On Thursday, DIIs turned net buyers to the tune of Rs 428 crore, but foreign portfolio investors (FPIs) sold shares worth Rs 2,819 crore, taking their nine-day selling tally to Rs 4,482 crore.

Market observers said retail investors continued to remain strong buyers in the market in a bid to 'buy the dip'. However, they were not able to offset the massive selling by DIIs and FPIs over the past few days. If the markets continue to correct, retail investors, too, could turn sellers, adding more downward pressure to the market, experts said.

Prior to the latest correction, the Sensex and the Nifty had gained for seven straight trading sessions, logging record highs of 61,766 and 18,477, respectively.

Institutional investors are prompted to take some money off the table given the sharp up-move seen last week, analysts said. Profit booking was more prominent in certain pockets that had seen frenzied buying.

On Wednesday, global brokerage UBS in a note said valuations of Indian equities had turned extremely expensive and the market had become unattractive.

Google Play cuts subscription fee from 30% to 15% starting Jan 1, 2022

 Google Play currently charges 30 percent fees for subscription services after 12 months. Now this will be 15 percent for subscription services from the first day

Google said today that starting on January 1, 2022, it will be decreasing the service fee for all subscriptions on Google Play to 15 percent from 30 percent, and for developers offering subscriptions, this means that first-year subscription fees will be cut in half.

"Digital subscriptions have become one of the fastest-growing models for developers but we know that subscription businesses face specific challenges in customer acquisition and retention. We’ve worked with our partners in dating, fitness, education, and other sectors to understand the nuances of their businesses. Our current service fee drops from 30 percent to 15 percent after 12 months of a recurring subscription. But we’ve heard that customer churn makes it challenging for subscription businesses to benefit from that reduced rate. So, we’re simplifying things to ensure they can," said Sameer Samat, Vice President, Product Management at Google, in a blog post on Thursday.

Google Play currently charges 30 percent fees for subscription services after 12 months. Now this will be 15 percent for subscription services from the first day.

Earlier this year Google launched the Play Media Experience program to encourage video, audio, and book developers alike to help grow the Android platform by building cross-device experiences. This helped developers invest in these multi-screen experiences with a service fee as low as 15 percent, the firm said in the blog post.

The tech giant further said e-books and on-demand music streaming services, where content costs account for the majority of sales, will now be eligible for a service fee as low as 10 percent.

Credit grows by 6.47 % on YoY basis to Rs 110.3 trillion in early October

 So far this year, the growth in the major banking indicators has been mixed. Growth in deposits has slowed down

The credit dispensed by commercial banks in India rose by 6.47 per cent on a year-on-year basis (Y-o-Y basis) to Rs 110.3 trillion as of October 08, 2021, according to the Reserve Bank of India data. The pace of credit is shed higher than 5.7 percent a year ago. But, it remains below the pre-pandemic level of 8.9 percent in October of 2019.

Usually, the month of October marks the beginning of the second half of the financial year and also the start of a busy season with traction for higher demand for loans from corporates, businesses, and retail segments.

Meanwhile, CARE Ratings, in the analysis of credit in the second half of the last 10 years, said the Indian economy appears to be in the take-off stage post the opening of the economy after the second lockdown in April 2021.

With the economy picking up further in the second half, it may be expected that there will be a higher demand for credit and overall growth of around 8-10 percent for the year (Fy22), the rating agency said.

So far this year, the growth in the major banking indicators has been mixed. Growth in deposits has slowed down.

RBI data showed deposit rose by 10.16 per cent on Y-o-Y basis to Rs 157.55 crore. The pace of deposit accretion is shed less compared to 10.5 per cent a year ago but still higher than 9.8 per cent in October 2019.

We expect gold imports to rise further in coming months: GJEPC

 The imports, it said, picked up in August which recorded the second-highest gold imports of 118.08 tonnes

The country's gold imports are expected to grow further in the coming months on account of peak demand due to festive and wedding seasons, Gems and Jewellery Export Promotion Council (GJEPC) said on Wednesday.

Gold imports, which have a bearing on the current account deficit, zoomed to about USD 24 billion during April-September 2021.

The council said that the imports have witnessed a fluctuating trend during the last six months and have come at par with the statistics of the pre-covid years.

Gold imports in May (12.98 tonnes) and June (17.57 tonnes) 2021 were severely hit by the second devastating Covid wave that resulted in nationwide lockdowns and paralysed several industries for a brief period including gem and jewelry, it added.

The imports, it said, picked up in August which recorded the second-highest gold imports of 118.08 tonnes.

Colin Shah, Chairman, GJEPC said that the increase in imports during July, August, and September 2021 was due to the lifting of lockdowns, revival of the domestic and export demand, and the start of the festive season which has resulted in a sharp rise in demand of the products.

We expect that imports of gold will further rise in the forthcoming months as peak festive/wedding season will further boost the demand for jewelry both at home and key international markets, Colin added.

India is the largest importer of gold, which mainly caters to the demand of the jewellery industry. In volume terms, the country imports 800-900 tonnes of gold annually.

Gems and jewellery exports increased to USD 19.3 billion during the first half of the current fiscal as against USD 8.7 billion in the same period previous year.