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Tag: Banking

  • Stocks to Watch: HP Adhesives, RBL Bank, Adani Trans, HUL, Lupin, CBI

    The key benchmark indices are likely to start trade on a quiet note owing to lack of any major directional cues from the overseas market. As of 08:00 AM, the SGX Nifty futures were quoted at 17040, up 14 points. Meanwhile, here the top stocks to focus in trade today.

    HP Adhesives: The stock will make its debut on the bourses today. The IPO was subscribed 20.96. The GMP (Grey Market Premium) indicates a likely listing gain of 20-25 per cent as against the issue price of Rs 274 per share.

    RBL Bank: According to CNBC TV reports, ace investors Rakesh Jhunjhunwala and D-Mart’s founder RK Damani have approached the Reserve Bank of India (RBI) to buy a 10 per cent stake in RBL Bank.

    Financials: Corporate houses, which are not allowed to own a bank, can now pick up 15 per cent stake in commercial banks through their non-banking financial companies (NBFCs). This is because the Reserve Bank of India (RBI) has allowed non-promoters to hold up to 15 per cent in private sector banks, following the recommendation of an internal working group (IWG) that was set up to review the existing guidelines on ownership and corporate structure for these entities.

    M&M, Tata Motors: Riding on the success of their recent model launches, homegrown auto majors Mahindra & Mahindra and Tata Motors are looking to further strengthen their product portfolios in 2022. Both companies are also looking at ways to handle the semiconductor shortage in a better way next year so that the impact on the production is minimal.

    Lupin: Homegrown pharmaceuticals major said it has received tentative approval from the US health regulator for its generic Azilsartan Medoxomil tablets used to treat high blood pressure.

    Central Bank of India (CBI): The last remaining public sector lender under the Reserve Bank of India’s prompt corrective action (PCA) framework, may see such restrictions being lifted in 2-3 months. Central Bank of India meets all the parameters for exiting the PCA framework and the RBI will remove it from PCA as soon as the end of this fiscal year, said an official.

    Canara Bank: The state-run bank has raised Rs 2,500 crore by issuing Basel-III compliant bonds to a total of 10 allottees.

    Kabra ExtrusionTechnik: The company has approved capex plan of Rs 100 crore for its battery division.

    Orchid Pharma: The company informed BSE, that CARE had revised its ratings on long-term and short-term bank facilities from CARE BBB -; Stable CARE A3 to CARE BBB- (CWD) and CARE A3 (CWD, respectively. The ratings agency has placed it on Credit Watch with developing implications.

    Stocks in F&O ban: Escorts, Indiabulls Housing Finance and Vodafone Idea are the only stocks in the F&O ban period today.

  • RBI rejects Religare Finvest’s proposal to rename itself

    The Reserve Bank of India rejected Religare Finvest Ltd’s proposal to rename itself Care Financial Services and declined to new management status to the existing management – a move that would derail debt restructuring of the finance company, said people aware of the matter.

    As per the RBI’s regulations, lenders cannot restructure loans of borrowers tagged as fraud, unless there is a change in management. Lenders have tagged its parent company Religare Enterprises Ltd (REL) as fraud.

    Religare Finvest itself filed a case of financial irregularities against REL and have also proposed a debt recast plan with REL as its promoter company. “There is a dichotomy here and this may be a reason for the banking regulator to reject the change in management status,” one of the persons quoted above said.

    Religare Finvest is under a corrective action plan (CAP) since January 2018, which restricts it from expanding business, including giving new loans. The existing board is seeking new management status since the old promoters, the Singh brothers, are no longer in control of the existing board. Also, a new management status would encourage its lenders to restructure its debt, the people said.

    Separately, to clean its books Religare Finvest on Wednesday declared Asset Reconstruction Company of India as the winning bidder for its ₹480-500 crore distressed loan auction. Arcil had offered ₹180-190 crore for the SME portfolio, said a third person aware of the deal.

    Religare did not respond to requests for comments.

    Meanwhile, some existing lenders are of the view that recast of the loan is possible only after the regulator removes the company from CAP, the people quoted above said.

    Last year, the insurance regulator permitted Religare Health Insurance to rename it as Care Health Insurance. However, the banking regulator was against a name change of a loss-making finance company, said the first person.

    In March 2020, Religare Finvest itself filed a case alleging financial irregularities against its former management following which a first information report against Religare Enterprises and its promoters, siblings Malvinder and Shivinder Mohan Singh, was filed.

    Subsequently, it submitted a debt recast plan with REL continuing to be its promoter company, according to the annual report of REL for FY21. “A proposed debt recast with the same management as a promoter that is tagged as fraud is not acceptable to RBI,” said one of the lenders aware of the matter.

    In March 2020, RBI rejected TCG Advisory’s proposal to acquire a stake in Religare Finvest and its housing finance subsidiary on grounds that the acquirer is not fit and proper.

    Subsequently, it submitted a debt recast plan with FEL continuing to be its promoter company, according to the annual report of REL for FY21. “A proposed debt recast with the same management as a promoter that is tagged as fraud is not acceptable to RBI,” said one of the lenders aware of the matter.

    Religare Finvest, which focuses on funding small and medium enterprises (SME), has ₹2,787 crore outstanding rated loans. State Bank of India has the highest exposure of ₹500 crore followed by Canara Bank at ₹485 crore