Weekly Business Roundup: Markets End in Negative; Banks Among Top Losers

Business - Nestle in a fix over Maggi controversy

Business - Nestle in a fix over Maggi controversyMarkets End in Negative

The 30-scrip BSE Sensitive Index (Sensex) closed 45 points or 0.17 percent down on Friday. The 50-scrip Nifty of the National Stock Exchange (NSE) also closed in the negative zone (16 points or 0.20 per cent down at 8,114.70 points). The Sensex losers on Friday included ICICI Bank (down 2.18 per cent at Rs.284.50), HDFC (down 1.62 per cent at Rs.1,198) and Axis Bank (down 1.38 per cent at Rs.548.35).

Nestle in a Fix Over Maggi Controversy

What was once the most favourite comfort food across India is now being deemed as a dangerous proposition because of the supposedly high levels of lead content in it. It is being tested around the country and banned with immediate effect. In fact, some other noodles brands have been tested as well and they have met the same treatment as Maggi. There has also been a huge outcry against celebrities such as Amitabh Bachchan, Madhuri Dixit, and Preity Zinta, who have endorsed the product. In fact, there is some possibility that cases could be filed against them. Nestle India authorities have however come forward and stated that they are ready to extend all the help necessary to protect the stars from this backlash.

RBI Hasn’t Ruled Out Rate Cuts Says Rajan

The head of RBI has stated that the apex bank of India has not shut its door on rate cuts to deal with the present financial situation. He has stated that the benchmark lending rate has come down by 0.25% earlier in the ongoing week. This, as he points out, has been done in spite of the risks associated with the same. Rajan has reiterated that every decision in the future would be taken on the basis of global and domestic factors.

Advices Regarding Gold Monetisation Scheme

In the last two weeks, the government has received over 550 suggestions on how to make the gold monetisation programme a success. Most of the advisers have said that gold deposits should have an interest rate of more than 6%. According to them, one of the major reasons behind the failure of the previous scheme was its really-low interest rate of 1%.

Fines Placed on Sanofi and GlaxoSmithKline

Competition Commission of India has imposed a fine of INR 64 crore on Sanofi, and GlaxoSmithKline Pharmaceuticals – prominent drug manufacturers – for collusive bidding. The bidding was done for providing a meningitis vaccine, which will be used by Haj pilgrims, to the government.

SBI to Auction Vulnerable Assets

State Bank of India has stated that it will be starting a huge web-based auction on 12 June. This auction will see the biggest public sector bank in India selling its weak assets, whose aggregate value has been calculated to be INR 1,300 crore.

Airlines’ Battle for Market Share Assumes Ugly Proportions

The war of one-upmanship in the aviation industry of India has become worse with IndiGo Airlines, owned by Rahul Bhatia, supposedly ‘poaching’ pilots from other companies. The Directorate Generate of Civil Aviation (DGCA) has already created an anti-poaching agreement and is also monitoring the same. However, it is being alleged that IndiGo is contravening that legislation in an attempt to hinder the functioning of the smaller operators in this domain.

GST Bill Needs to be Fine-tuned: KM Mani

KM Mani, Chairman of Empowered Committee of State Finance Ministers, has said that the GST bill would need some further improvement. It has been proposed that in the first three years states that lose out on revenue shall receive 100% compensation. It will come down to 75% during the fourth year and 50% in the fifth.