NCLT will pass the final order on the plea challenging the admission of Go First insolvency on May 22nd.
It may be recollected that aircraft lessors had challenged the NCLT order admitting Go First into voluntary insolvency. The decision has to be on whether the NCLTAT will hold the NCLT order or not. However, the counsel for the IRC has underlined that lessors had terminated leases after Go First announced plans to file insolvency. The termination defeated the purpose of the IBC to repossess the planes from the lessee.
Merchandise exports fell to 6-month lows, imports fell to a 20-month low and trade deficit fell to a 34-month low; a classic case of pressure on overall trade. Along with weak commodity prices, the tepid global demand has also kept overall trade in check. However, the big redeeming feature of the month was the strong pick up on the services trade. Now services exports are 88% of merchandise exports and the trade surplus on services has nearly wiped out merchandise deficit, leaving a residual deficit of just $1.38 billion.
With crude prices falling almost on a daily basis, India has cut windfall tax on petroleum crude from Rs4,100 per tonne to zero, effective 16th May 2023. Earlier in May, the windfall tax on domestic crude was slashed from Rs6,400 to Rs4,100 per tonne. The windfall tax on petrol, diesel and ATF are already at zero levels. Meanwhile, the government has already scrapped the export duty on diesel. The windfall tax takes away any price producers earn above a threshold. Globally, supernormal energy prices were taxed.
WPI inflation, the measure of producer inflation, fell to a 34-month low of -0.92% in April 2023. The contraction in WPI inflation was led by manufacturing inflation staying in negative zone for the second month in succession. Manufacturing has a 64.2% weight in the WPI index. While MOM inflation remained flat on the WPI front, there was pressure on food prices while energy and manufacturing saw lower MOM inflation. This could be attributed to the base effect for energy. WPI inflation is down 1,755 bps in 1 year.
South Asia Gas Enterprise (SAGE), a consortium of deepwater pipeline companies, plans an undersea gas pipeline between the Middle East and India. SAGE is seeking diplomatic and political buy-in for the project. The overall project value will be $5.4 billion. It will be a 2,000-KM long energy corridor connecting Middle East and India and will save Rs7,000 crore each year for India’s LNG imports. It was originally conceived 10 years back but was put off. SAGE will deliver 31 MMSCMD gas under 20-year long term supply contract.
The NSE posted 31% higher net profits of Rs2,067 crore for Q4FY23. Net margins stood at 55%. Revenues from operations also grew 31% at Rs3,453 crore for the quarter. Revenue contribution also came from listing fees, index services, data services and colocation facility. For FY23, NSE reported net profits of Rs7,356 crore compared to Rs5,198 crore in FY22. Quarterly EPS stands at Rs41.73 per share. NSE has also recommended dividend at Rs80 per share. The exchange also contributed Rs21,965 crore in STT flows.
Minority shareholders of Dish TV have demanded an extraordinary general meeting (EGM) to evaluate the request by Yes Bank for removal of 2 directors (Shankar Aggarwal and Rashmi Aggarwal) from the board. Yes Bank is the biggest shareholder in Dish TV, holding 24% stake. The promoter family led by Jawahar Goel holds just 4% and the two have been embroiled in a bitter battle for control. Goel has already resigned from the post of CEO. Yes Bank has transferred its stake in Dish TV to JC Flowers ARC.
Government confirmed that it was on target to meet its net-zero targets by 2070 in a phased manner. For example, today thermal plants meet 75% of energy needs with 51% of these plants being coal dependent. By 2040, the government will reduce this share of thermal plants to just 30% and eventually to net zero by the year 2070. India is already one of the few countries that has been heavily investing in alternate energy. In FY23, India consumed 1.1 billion tonnes of coal for power, of which 200 MMT were imported.