CAPITALHISTORY
100 to ~1.12 lakh in just 2 yrs
A favourable swap ratio in the merger of Supriya & Sadanand Sule's
private firm with Lavasa and a high-premium secondary market purchase
sweetened deal
NSUNDARESHASUBRAMANIAN & SANJAYJOG Mumbai, 20 October
Supriya and Sadanand Sule, daughter and son-in-law of NCP President
Sharad Pawar got sweetheart deals in Lavasa, not once but twice.
First, their shares in Yashomala Leasing and Finance Pvt Ltd (YLFPL)
were swapped for those of Lavasa Corporation at a favourable ratio of
1:750 in 2002. This merger gave the Sules a 20.81 per cent stake in
Lavasa Corporation, then known as Lake City Corp Pvt Ltd. Later, the
promoters themselves bought shares at a substantial premium, setting
the benchmark for the Sules' exit at a premium.
The facts become interesting in the context of police
officer-turned-activist Y PSingh's recent allegations of
irregularities in Lavasa deals having benefited the NCPleadership.
According to a scheme of merger approved by the Bombay High Court in
August, 2002, Lavasa issued "750 equity shares of ~10 each and 1,600
redeemable preference shares of ~10 each at a premium of ~10 per
share… to the shareholders of YLFPL for every one equity share of ~100
held by the then shareholders of YLFPL". Thus, for one share worth
~100, the Sules got Lavasa equity shares worth ~7,500 and preference
shares worth ~32,000.
Further sweetening the deal, just a month prior to the board meeting
(January 2002), in which the merger with YLFPL was approved, in
December 2001, Lavasa had issued shares at ~73.35 each. Thus, one ~100
YLFPL share held by the Sules multiplied into 750 Lavasa shares worth
~55,012.50.
Assuming the Sules exited in 2003-04, as claimed by the NCP
spokesperson on Thursday, the exit price could not have been lower
than ~106.67 apiece. Because, that is the price at which the promoters
bought some 1.5 million shares in September 2003. It is not clear if
the Sules exited the company through this transaction. At this price,
one ~100 YLFPL share eventually fetched ~80,002.50. In addition to
this, 1,600 redeemable preference shares would be worth another
~32,000, assuming there was no further appreciation in value.
According to the draft offer document filed by Lavasa Corporation in
September 2010, "pursuant to the merger of Yashomala Leasing and
Finance Pvt Ltd with our company 1,248,750 equity shares were issued
to Sadanand B Sule jointly with Supriya Sule".
At the swap ratio of 1:750, this means the couple held 1,665 YFLPL
shares between them worth ~1.66 lakh at face value. Thus, an
investment of ~1.66 lakh in YLFPL zoomed to ~18.64 crore. Of this,
~13.32 crore came from their Lavasa equity holding, while the
preference share holding of 2.66 million alone was worth ~5.32 crore.
Emails seeking comments sent to spokespersons of Lavasa and HCC did
not elicit any response. Sadanand and Supriya Sule did not respond to
an emailed questionnaire on Friday evening and text messages sent on
Friday as well as Saturday. A person familiar with the transactions
said the merger was done in a transparent manner and was approved by
court. Two other couples who were shareholders in YFLPL also seem to
have enjoyed similar appreciation. Aniruddha P Deshpande and Sona
Deshpande and Vinay V Maniar and Ruchira Maniar also were issued
exactly the same number of shares issued to the Sule couple, according
to the scheme of merger.
As on the date of the draft prospectus, Vinay Maniar held 28.89
million shares amounting to 5.95 per cent stake in Lavasa. Thus, even
if they had sold in 2003-04 as claimed, the Yashomala shareholders got
a sweetheart deal, though the sum is small. If they sold at the
valuation at which Axis entered, then it is another matter altogether.
Feb 2000: Pearly Blue Lake Resorts incorporated
Dec 2000: Name changed to Lake City Corporation
Dec 2001: Capital infusion in 2 tranches (1.49 mn shares @ ~58.34
apiece &0.74 mn shares @ ~73.35
Jan 2002: Board approves merger with Yashomala
Aug 2002: Bombay High Court approves merger at swap ratio of 1:750
Oct 2002: Supriya and Sadanand Sule get 1.24 mn Lavasa shares in
exchange for 1,665 Yashomala shares
Sep 2003: Lake City promoters (HCC) buy 1.5 million shares at ~106.67
in secondary sale
Mar–Sep 2004: Promoters buy 750,000 shares at same price
Jun 2004: Lake City renamed as Lavasa Corporation
Nov2004: Promoters buy 49,000 shares at ~120.68
Sep 2005: Promoters sell this entire secondary market purchase of
29.99 million @ ~120.68 Source: Draft offer document
Governmentrolls outdirectcash transfersystem underAadhaar
PRESS TRUST OF INDIA
Jaipur, 20 October
The United Progressive Alliance government today rolled out the direct
cash transfer system under Aadhaar scheme to eliminate fraud and
corruption with Prime Minister Manmohan Singh saying his government
will use technology to bring transparency.
The launch, marking the second anniversary of Aadhaar project, is
aimed at checking corruption and pilferage in schemes and to bring
transparency in implementation. "Our government wants to make maximum
use of technology, IT in particular, on large scale to make the
administration accountable and to bring transparency and Aadhaar is a
significant step in this direction," said Singh, who launched the
scheme in the presence of UPA Chairperson Sonia Gandhi.
"We always make efforts to provide opportunities to people of
economically weaker section to grow and prosper, and this project was
also started with this objective.This will help crores of unemployed
people. People face problem in starting a business or taking advantage
of government's welfare schemes if they do not have a identity proof,
and we want to remove such difficulties," he said.
"Cash benefits under the schemes will be transferred to the accounts
of the beneficiaries. On the basis of Aadhaar, we can ensure that
benefit of schemes reach genuine beneficiaries and that there is no
mediator," he said.
Handing over Aadhaar card number '21 crore' to Bali Bai, who hails
from Udaipur district, Gandhi said, "It is the biggest scheme, of its
kind, in the world and one of the important programmes of UPA
government....The vision behind this is very clear to provide aam admi
aright of identity." "This will transform lives of aam adm i. It is
being used as residence proof in few states, and this will help the
government transmit subsidy directly to accounts of the beneficiary,"
she said.
The scheme will be used for making payments to beneficiaries under
MGNREGA, PDS, social security pension schemes, LPG distribution
scheme, Chief Minister's rural BPL housing and Chief Minister's higher
education scholarship. Speaking at the function, Finance Minister P
Chidambaram said, "Aadhaar is a boon for government schemes.It will
help government in implementing welfare schemes and programmes like
pension and scholarship schemes, subsidy on LPG cylinders and
kerosene, effectively and to make sure the real person gets the
benefit." Aadhaar, a 12-digit number, serves as a proof of identity
and address anywhere in the country. It is an online identity platform
that can be accessed in real-time for authenticating beneficiaries and
can be adapted by various user agencies.
Noting that the Unique Identification Authority of India has made
remarkable achievements in a short span of time, the Prime Minister
congratulated the officials for their performance. He also presented
'Aadhaar Governance Awards' and 'Aadhaar Excellence Awards' at the
function.
Speaking on the occasion, Rajasthan Chief Minister Ashok Gehlot said
several social welfare schemes in the state will be Aadhaar enabled in
future.
Remembering former prime minister Rajiv Gandhi, Gehlot said IT
revolution has brought a major shift in the lives of people and the
Aadhaar card will also bring positive changes.
"With Aadhaar, we can ensure that the entire money that is sent from
the Centre reaches real beneficiaries in remote areas. This will be a
significant achievement," he said. He announced linking of Public
Distribution System at three places including Dudu and Chomu (Jaipur)
in the state with Adadhaar enabled delivery system.
The chief minister also announced a scholarship scheme for higher
education in the state under which ~500 will be given for five years.
The scheme will be used for making payments to beneficiaries under
MGNREGA, PDS, social security pension schemes, LPG distribution, chief
minister's rural BPL housing etc
(From left) Sonia Gandhi, Manmohan Singh and P Chidambaram at the
launch of 'Aadhaar' schemes at Dudu near Jaipur on Saturday. PHOTO:
PTI
GST network to be set up by the end of this financial year
VRISHTI BENIWAL
New Delhi, 20 October
Having missed the August deadline to roll out a special purpose
vehicle (SPV) to provide common information technology (IT)
infrastructure to the Centre and the states in the goods & services
tax (GST) regime, the finance ministry is now planning to set up the
GST network (GSTN) by the end of this financial year.
It has extended the tenure of Empowered Committee on GSTN headed by
Nandan Nilekani by one year to September 2013.
"The SPV would become operational shortly and all states might become
part of GSTN by the end of this year. The Nilekani panel has been
given an extension to ensure smooth implementation of the information
technology platform," said a finance ministry official, adding some
applications were in advanced stages of implementation.
While GST might not be rolled out from April 2013, the work on
developing the IT platform is going on at full throttle so that it is
ready for use by the Centre and states even under the current regime.
It is expected to help improve interface among taxpayers, tax
administrators and banks.
Three options to be offered to the states for usage of services
provided by the GSTN are under consideration.
In the first, GSTN will offer the full range of GST services as a
utility which states can utilise.
In the second, "limited service model", states will use GSTN for
common registration, return and payments and have their own software
for the remaining GST functions.
As a third option, states can go for "application programming
interface model" and have their own software for flexibility.
However, they will have to adhere to the common registration, return
and payment formats defined by the GSTN and ensure that the rights of
both the states and the Centre are protected in terms of getting
information and ensuring timely settlement of share of taxes.
The SPV would be incorporated as a not-for-profit company in which the
government will retain strategic control.
It would have an equity capital of ~10 crore. Both the Centre and the
states will have a stake of 24.5 per cent each in the SPV, while NSDL
will have 21 per cent.
Three financial institutions will get stakes of 10 per cent each. It
will have a selfsustaining revenue model based on levy of user charges
on tax payers and tax authorities availing its services.
Pilot projects are going on in 11 states with NSDL as the technology
partner. Representatives of various tax authorities, test users from
banking industry, and trade diasporas are involved in an objective
testing phase.
Prototypes of probable models of key business processes —
registration, return filing and payment of taxes are developed. There
will be a common portal that could be shared by all the states and the
Centre and act as an IT platform to integrate Central and state
indirect tax regime.
The use of permanent account number as a common identifier in both
direct and indirect taxes is likely to enhance transparency and check
tax evasion.
Subsidy provided for various goods and services can also be linked with GSTN.
While states are at different levels of computerisation, Maharashtra,
Tamil Nadu, Kerala, Andhra Pradesh, Karnataka and Gujarat have made
considerable progress. RELOADED STRATEGY
|Finance ministry misses August deadline to roll out a special purpose
vehicle to provide common information technology (IT) infrastructure
to the Centre and the states in the goods & services tax regime
|Ministry extends tenure of Empowered Committee on goods & services
tax network (GSTN) headed by Nandan Nilekani by one year to September
2013 |While GST might not be rolled out from April 2013, the work on
developing the information technology platform is going on at full
throttle so that it is ready for use by the Centre and states even
under the current regime |Three options to be offered to states for
usage of services provided by the GSTN are under consideration |Under
the first option, GSTN will offer the full range of GST services as a
utility which states can utilise |Under the second option — limited
service model — states will use GSTN for common registration, return
and payments and have their own software for the remaining GST
functions.
|Under third option, states can go for "application programming
interface model" and have their own software for flexibility
Now, defined criteria to determine commodities' launch on exchanges
DILIP KUMAR JHA
Mumbai, 20 October
In order to curb the free flow of contracts on the exchange platform,
the Forward Markets Commission (FMC) is planning to frame a set of
criteria for agri commodities for determining their launch on futures
exchange.
"Criteria are being worked out which would determine whether
commodities are fit for trading on futures exchanges or not," FMC
Chairman Ramesh Abhishek said.
According to sources, FMC would categorise all commodities currently
being produced, consumed and traded in India. Beginning from the top,
the proposed four categories would begin with the most popular – soya,
bullion, base metals, steel and energy—and end with the least popular—
region-specific agri commodities such as isabgul and funnel seed. The
remaining two categories would entail highly turbulent, like guar, and
smoothly-traded ones, including coffee and rubber.
With primary focus on narrow commodities in short-supply or
uncertainty about their crop size season due to vagaries of nature,
the criteria are expected to restrict the launch of unpopular
commodities. Also, commodity traders would be more focused on popular
commodities, which they know better in order to reduce chances for
incurring losses.
Currently, exchanges do research and extensive due diligence on their
own before submitting a contract's launch proposal to FMC. There are
no defined criteria as on today.
In the absence of proper defined criteria, commodity exchanges launch
a contract based on their own market analysis which mostly becomes
unfavourable. Consequently, over two-third of contracts launched on
futures exchange turns illiquid after initial success. Also, a number
of contracts remain untraded for months and suddenly attracts huge
participation towards the end of the financial year. But, once
criteria are defined, chances of contracts turning illiquid would be
limited.
The criteria, however, would be put forth before the proposed
sub-committee after its appointment which would later be forwarded to
FMC for consideration. FMC, after due consideration, would seek views
from its parent ministry to make it effective.
According to members of the 40-member advisory committee, the proposed
criteria would not allow region-specific agri commodities even if they
have wide consumer reach.
Often it is seen that commodity brokers claim to have incurred losses
in the absence of authentic information about acommodity.
Faced with massive asymmetric losses incurred by genuine traders due
to non-availability of authentic crop data, FMC has urged the parent
ministry to appoint a nodal agency similar to the US Department of
Agriculture (USDA) for pooling and disseminating data of agri
commodities.
"We have sent our recommendation to the ministry. We are awaiting
response," said Abhishek.
The recommendation assumes significance as a select class of traders
with authentic information on crop takes their position well in
advance, others with limited or little knowledge in the same commodity
often follow others. By the time the followers take position, the
early birds or trend setters take advantage and exit the active space.
Consequently, the followers end with a massive loss on their position
while the early traders catch the big fish. Hence, it is important to
have a uniform and unbiased agency which can pool data from reliable
sources and disseminate the same to all classes of traders at one go,
said Abhishek.
The world eagerly awaits data from USDA as the same determines the
market movement in the US. The data also sets the trend for the
upcoming season of all given commodities.
In India, however, there are alot of agencies currently pooling and
disseminating data on private basis either for their clients or for
their members and traders. But, two agencies differ for all figures on
the same crop which questions reliability of the source.
Proposed sub-committee of the advisory panel to decide contracts'
competence for trading
FMC Chairman Ramesh Abhishek
When buying a house…
STEVEN FERNANDES
For several years, Pankaj Shastri has been wavering: should he buy
aflat or should he not? Sometimes, he liked a flat but postponed a
decision at the last minute thinking that the property market was
overdue for a correction. The rates, however, kept on increasing.
Affordability has also been an issue since he is the only earning
member.
Now that he has finally decided that he is going to buy a flat, he is
grappling with a separate set of problems: either the area is good but
expensive, or the rates are reasobale but the flat is too small.
This is a common problem for people who are house hunting. However,
harsh it may sound, one has to start with simple things like budget
and stick to that. here are some key issues you need to consider in
detail in order to take an informed decision:
Budget
It's an old saying that "Cut your coat to suit your cloth". Majority
of the flats today are purchased with the help of a home loan. The
banks may provide you funding of up to 85 per cent of the flat cost,
but keep in mind that your EMI payments should not cross maximum of
40- 45 per cent of your take home salary and can be further less if
you are a single income family with kids. That is, if you are earning
a net income of ~75,000 per month with monthly expenses of ~30,000,
then considering present floating home loan interest rate at 11 per
cent, the EMI per lakh would be ~1,136 for 15 year tenure and you can
take a loan up to ~ 26 lakh for an EMI of ~29,551.
If you are falling short of the down – payment component, then it's
better to postpone your goal and start saving to bridge that gap. Lot
of first time buyers, go for a personal loan (which are offered at
between 14-18 per cent interest) to meet the shortfall and then they
realise later that it's difficult to service two loans. Eventually
they juggle between trying to maintain adequate balance in their bank
account to meet their EMI liabilities and the shortfall in monthly
expenses is then made good by the use of credit cards, which further
pushes them in a vicious circle. Ideally if you can get a soft loan
from your family members then too it is advisable to go ahead.
Other costs
In an under – construction / ready flat purchased from builder, you
will get the breakup of the total payment to be done which includes
not only the flat cost but also charges for stamp duty and
registration, electricity meter, club house corpus, one year
maintenance and VAT. But in a resale flat, you will also have to
figure out if there are any unpaid dues owed to society, monthly
maintenance cost, cost for painting, repairs, furniture, etc and not
forgetting the brokerage to be paid to your broker. Take a realistic
view on all the costs involved before finalising the budget.
Location
Once your budget is decided, you can then get an idea of the choice of
flats available within that budget and the areas where it's available.
Sometimes it's a reverse calculation. You fancy yourself as staying in
a particular area / complex and accordingly you can set your bu d g e
t .
Location is important as you will be able to figure out whether all
facilities such as public / private transport, Schools, Shopping
malls, nearest railway stations are within accessible distance or not.
The poorer the connectivity the higher will be your monthly outgo
towards commuting and shopping for essential services. If your budget
is low then you have to make a choice between a bigger house in a far
locality and a smaller house in a well connected locality.
Ready flat / Resale / Underconstruction property
Typically this depends on your budget. If given a choice, people most
likely would want to buy either a ready to move in new flat or a
resale flat of a new construction where all the facilities and
connectivity has been provided. These flats of course come at premium
over market rates. But if budget is a constraint here, then you can
chose under – construction property as it is available typically at a
discount over ready flats and you get an opportunity to pay according
to the stage wise construction.
A word of caution here – You need to check the past track record of
the builder and the prevailing market situation before booking an
under-construction flat as the possession date might get postponed
like it has happened in many projects launched in the year 2008,
thereby increasing your cost of staying in a rented house till then.
Get your credit score
Today all financial institutions access the applicant's credit report
from CIBIL, which is the prominent credit bureau, created for
assessing the individual's credit worthiness. In short, a higher
credit score indicates that the applicant has a very good credit
history while a lower score can indicate vice versa. You need to get
your credit score to check if you have been fairly rated by the
bureau. If your rating is unfortunately lower due to your previous
bank not reporting your timely payments done, then you can always ask
that bank to rectify the error and resend the same to CIBIL, which
might improve your score and you are then better placed to get your
desired home loan as per your eligibility.
It is always better to take an informed decision since it involves
your life's biggest investment. Always involve your spouse or senior
family members (if you are not married), including your financial
planner in the discussion and take that confident step towards your
dream house.
Follow a few rules strictly. Otherwise, there will be unnecessary
financial pressure in the end
--
.
-
CS A RENGARAJAN,, B.Com ,FCS, LLB, PGDBM
Company Secretary, Chennai
email csarengarajan@gmail.com
http://www.csarengarajan.blogspot.com
http://companysecretarytalent.blogspot.com/
http://companysecretarybenevolentfund.blogspot.com/
http://csvacancies.blogspot.com/
mobile 093810 11200
CS Benevolent Fund is a collective effort towards extending the much
needed financial support to the community of Company Secretaries in
times of distress Let us lend support and join for noble cause.
SHARING KNOWLEDGE SKY IS THE LIMIT
This mail and its attachments (if any) are confidential information
intended for persons to whom the email is planned for delivery by the
sender. If you have received this mail in error please notify the
sender of the error by forwarding the email and its attachments (if
any) and then deleting the mail received in error and the relevant
email trail in this connection without making any copies or taking any
prints.
------------------------------------
receive alert on mobile, subscribe to SMS Channel named "aaykarbhavan"
[COST FREE]
SEND "on aaykarbhavan" TO 9870807070 FROM YOUR MOBILE.
To receive the mails from this group send message to aaykarbhavan-subscribe@yahoogroups.comYahoo! Groups Links
<*> To visit your group on the web, go to:
http://groups.yahoo.com/group/aaykarbhavan/
<*> Your email settings:
Individual Email | Traditional
<*> To change settings online go to:
http://groups.yahoo.com/group/aaykarbhavan/join
(Yahoo! ID required)
<*> To change settings via email:
aaykarbhavan-digest@yahoogroups.com
aaykarbhavan-fullfeatured@yahoogroups.com
<*> To unsubscribe from this group, send an email to:
aaykarbhavan-unsubscribe@yahoogroups.com
<*> Your use of Yahoo! Groups is subject to:
http://docs.yahoo.com/info/terms/
No comments:
Post a Comment