Author: Raoji

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Observations This is India !

NMDC = No Money, Dividend Compulsory

This post belongs to my This is India ! series

NMDC held a Board Meeting on 17th March, 2018 and decided not to issue an interim dividend

The market reacted very badly and the stock crashed by around 7% the next trading day.

So imagine the market’s surprise when less than 10 days later NMDC offered a whopping interim dividend of Rs.4.3  (Dividend Yield of 3.5%)

The fact that the dividend is proposed to be paid before 31st March, 2018 betrays the fact that the Co was arm twisted by its largest shareholder (the Govt of India) who will gain around 1,340 Crores from the dividend.

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Cartoon

Markets: The worst could be behind or…

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Excerpts

PNB may be the first bank to be declared defaulter

The government and the Reserve Bank of India (RBI) may have to step in to avoid an unprecedented event in Indian banking. Close to Rs 1,000 crore of Union Bank of India’s exposure on account of letters of undertakings (LoUs) issued by Punjab National Bank is due in the next few days. 

If the state-owned PNB does not pay back the amount by March 31, Union Bank (another government owned lender) will have to treat PNB as a defaulter in its books, provide for the loan, and even classify the amount as non-performing asset (NPA) if auditors insist. 

“It would be a peculiar situation because for the first time a bank would be technically described as defaulter,” a senior banker told ET. In the event of fraud, banks are required to make full and immediate provisioning against outstanding as well as categorise the loan as NPA. 

–from ET

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Links

Linkfest: 26 March, 2018

Some stuff I am reading today morning:

A letter that is spooking ICICI Bank shareholders (Arvind Gupta)

Trade wars will lead to economic crisis (Robert Shiller)

IPO Review: Lemon Tree Hotels (Quint)

Stock Talk: Advanced Enzymes (Dhruva Pandey)

Hiranandanis to invest 3500 Cr in oil & gas sector (Mint)

Mutual Fund advisers are leeches (Mystic Wealth)

How Chinese trade secret theft nearly killed my company (CNN)

The last days of Whitney Tilson’s Kase Capital (IIAlpha)

What could you build with just $10,000? (Hacker Noon)

The Market Generals are dead (Zero Hedge)

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TopClicks

Top Clicks on Alpha Ideas This Week

Here are the most clicked items on Alpha Ideas this week:

Indian Hotel Industry at Inflection Point (AI)

Karda Constructions: Your money can hurt us (AI)

Which stocks to invest when Nifty breaks 10,000 (MC)

23,000 dollar millionaires have fled India since 2014 (ET)

ICICI Securities: Nailing the Cyclical High (AI)

Lemon Tree Hotels: Employees check out faster (AI)

Taylormade Renewables: Mind boggling assets (AI)

The Mystery that can shake the markets (AI)

When Mutual Fund CEOs get over-smart (Mint)

Stock Talk: Sintex Plastics (Dolly)