by admin | May 25, 2021 | Commodities, Commodities News, Commodity Market, Investing, Mutual Fund
New Delhi : The Securities and Exchange Board of India (SEBI) on Friday allowed mutual funds (MFs) and portfolio managers to invest in commodity derivatives to strengthen the market offerings and attract more players.
“The Board deliberated and approved the proposal contained in the memorandum to enable the participation by mutual funds and portfolio managers in exchange traded commodity derivatives in India subject to certain safeguards,” SEBI said after its board meeting here.
“Further, Category III alternative investment funds, which are already permitted to participate in commodity derivatives, have now been permitted to deal with goods received in delivery against physical settlement of such contracts, if any,” the regulator added.
Currently, the commodity markets are dominated by retail level traders and a few corporate hedgers and speculators. The entry of mutual funds and portfolio managers will attract more hedgers to the market and lead to its overall development.
Market players said the SEBI move could offer structured and attractive products to deepen the commodity derivatives market. It would also lead to more participation from the funds.
Institutional participants like mutual funds and portfolio managers will add long-term liquidity to the markets, said the member of a commodity exchange.
The participants in the commodity derivatives market comprise retail and wholesale commodity traders and a few corporate clients and punters across asset classes.
The SEBI also allowed Category III alternative investment funds to trade. Foreign companies with exposure to Indian commodities not having presence in India were also allowed to trade recently.
—IANS
by admin | May 25, 2021 | Commodities, Commodities News, Economy, Markets, News
Mumbai : A day after market regulator SEBI declared the commodity broking arms of Motilal Oswal and India Infoline (IIFL) as not “fit and proper” in the NSEL case, the scrip price of both the companies fell up to 5 per cent and 9 per cent respectively on Monday.
Stock price of Motilal Oswal on BSE declined up to 5.11 per cent but pared some of its early losses trading 2.85 per cent down at Rs 594.85 per share, while IIFL Holding Ltd. tanked up to 9 per cent.
The Securities and Exchange Board of India (SEBI) is probing as many as 300 brokers for violation of rules colluding with the National Spot Exchange Ltd (NSEL) to defraud investors. In fact, the regulator has named brokerage firms in a first information report (FIR).
What this meant was that NSEL did not maintain sufficient underlying stock on trades it allowed even as brokers sold lucrative contracts to investors.
This builds defaults and resulted in the exchange denying payments worth Rs 5,600 crore in 2013.
“In view of the seriousness of the matter, facts and circumstances of the case, the conduct of the noticee in its functioning as a commodity broker is questionable and has certainly eroded its general reputation, record of fairness, honesty and integrity and has therefore affected its status as a ‘fit and proper person’ to be an intermediary in the securities market,” the designated authorities said in the report submitted to SEBI.
In an order uploaded on its website on February 22, SEBI said that the brokers had a close association with NSEL and allowed themselves to “become a channel”.
“Thus the noticee is not a fit and proper person to be granted registration/to operate as a commodity derivatives broker,” the order said.
SEBI has also ordered both Motilal Oswal and IIFL to transfer securities of all their clients and allow withdrawal within 45 days of the order.
Failing this, “the noticee shall transfer its balance clients with their corresponding securities and funds to another person, holding a valid certificate of registration to carry on such activity, within a further period of 30 days”, the order said.
—IANS
by admin | May 25, 2021 | Business, Commodity Market, Investing, Mutual Fund
Mumbai : Capital markets regulator SEBI on Monday granted relaxation to non-residents from furnishing PAN card details to transfer equity shares to their immediate relatives subject to conditions.
According to the SEBI, many non-residents such as Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs), Persons of Indian Origin (PIOs) and foreign nationals have been facing difficulties in transferring shares held by them since many of them do not have PAN card.
“In order to address the difficulties faced by such investors, it has been decided to grant relaxation to non-residents (such as NRIs, PIOs, OCIs and foreign nationals) from the requirement to furnish PAN and permit them to transfer equity shares held by them in listed entities to their immediate relatives…,” the SEBI said in a circular.
Accordingly, the relaxation shall only be available for transfers executed after January 1, 2016.
“The relaxation shall only be available to non-commercial transactions, i.e. transfer by way of gift among immediate relatives,” the circular said.
“The non-resident shall provide copy of an alternate valid document to ascertain identity as well as the non-resident status.”
—IANS
by admin | May 25, 2021 | Corporate, Corporate Buzz
New Delhi : In what finally appears to be a crackdown against Zee, consequent to the enforcement of securities by two lenders on Friday, Member SEBI Madhabi Puri Buch has finally summoned the four CEOs of Birla MF, ICICI MF, HDFC MF and RELIANCE MF and the CEO of ratings agency Brickworks on Monday to quiz them on the matter.
This looks like a case for punitive action by SEBI.
On January 27, Zee Chairman Subhash Chandra stated that an agreement had been reached with lenders; the next morning his son said 96-97 per cent lenders have approved; the stock rose from Rs 310 to Rs 380; by Friday it became clear that no agreement had been signed; further two lenders enforced securities and sold shares, proving the statements of January 27 and 28 were clearly fraudulent and misleading.
It is a tale of failure across the food chain:
*Stock exchanges: Made no attempt for a full week to verify the truth of publicly announced claims on the alleged settlement with lenders, and/or details in respect of the same
*Rating Agency Brickworks – did not downgrade securities despite fall in security cover; made no attempt to verify the truth of publicly announced claims on the alleged settlement with lenders, and finally, on Friday, still referred only to “reported” settlement, whereas it has powers to have called for all details from the Borrowers
*MFs – did not disclose breach of covenants on borrowings to their investors; attempted to brush breaches under the carpet by discussing private “settlement” without approvals from their Board of Directors/Trustees; did not refute false public claims on settlement by promoters despite knowing full well there was no agreement signed
*SEBI – Did not haul up MFs for attempting to privately discuss/”settle” default situation without informing their investors about the same, and without any formal internal approvals
– did not haul up stock exchanges for week long inaction
– did not haul up rating agency for week long inaction
– has not taken any action against promoters for blatant fraud and misrepresentation
—IANS
by admin | May 25, 2021 | Banking, Corporate, Corporate finance, Economy, Finance, News
Mumbai : Hours after an official of securities market regulator SEBI said that ICICI Bank has filed for settlement through consent mechanism, the private lender denied filing any such application.
The company, however, said that it has submitted its response to the show cause notice issued by SEBI.
“We have submitted our response to the show cause notice issued by SEBI. We would like to clarify that we have not filed any application for settlement,” ICICI Bank said in a regulatory filing on Tuesday.
Earlier in the day, answering questions on the issue after SEBI’s annual board meet, SEBI chief Ajay Tyagi said: “On the ICICI (issue), to my information some reply has come from the bank and the earlier CEO (Kochhar), so, we will examine that…”
On the plea for settlement through consent mechanism, Tyagi claimed ignorance. However, another SEBI official present at the conference confirmed the request.
The stock market regulator provides for an out-of-the-court settlement procedure to settle cases — consent mechanism — which does not warrant admission or denial of the alleged wrongdoing.
SEBI had issued a show cause notice to ICICI Bank and its MD and CEO Kochhar regarding conflict of interest in lending to Videocon Group, which has had business tie-ups with her husband Deepak Kochhar.
Currently, former Supreme Court judge B.N. Srikrishna (Retd) is heading an independent enquiry into the allegations.
The bank on May 30 announced that its Board has decided to institute a “comprehensive enquiry” to look into an anonymous whistleblower’s complaint alleging that Kochhar had not adhered to provisions relating to “code of conduct” of the bank.
In June, Kochhar decided to proceed on leave and subsequently, Sandeep Bakhshi was appointed as the wholetime Director and Chief Operating Officer (COO) of the bank.
—IANS
