Moody’s cuts GDP growth forecast to 5.6% for this fiscal Growth projections for FY20
Labour Minister Santosh Kumar Gangwar pitched for a separate ministry for promoting cooperatives, saying they are effective institutions where people can find job opportunities. Cooperatives now come under the Agriculture Ministry. "There is a need to form Ministry of Cooperatives so that cooperatives can develop as professional and effective institutions,” he said.
Walmart took a non-cash impairment charge of $290 million for the value of the 'Jabong' trade name in the third quarter. Walmart logged
2.5 per cent rise in revenue at
$128 bn for Q3. Walmart EVP & CFO Brett Biggs said, "Since there was value ascribed to the Jabong name at the time of the Flipkart acquisition, we are taking a non-cash impairment.”
After downgrading the rating outlook on India to negative from stable last week, Moody’s Investors Service on Thursday cut India’s GDP growth forecast for the current financial year to 5.6 per cent from 5.8 per cent estimated earlier, saying the economic slowdown is lasting longer than previously expected.
Citing that the government steps do not address the widespread weakness in consumption demand in the country, Moody’s said, “We have revised down our growth forecast for India. We now forecast slower real GDP growth of
5.6 per cent in 2019, from
7.4 per cent in 2018.” The rating agency’s move comes in the backdrop of other rating agencies, brokerages and banks cutting the gross domestic product (GDP) growth forecast between
6.2 and 4.9 per cent for this financial year (see table). Japanese brokerage Nomura estimated the lowest GDP growth of 4.9 per cent for the year ending March 2020, while domestic rating agency Icra projected the highest growth rate at 6.2 per cent.
Moody’s had on October
10 cut India’s economic growth forecast for 2019-20 fiscal to 5.8 per cent from an earlier estimate of 6.2 per cent. The rating agency then attributed the trend of deceleration to an investment-led slowdown due to low consumption, financial stress among rural households and weak job creation.
The country’s economy grew at the weakest pace since 2013 at 5 per cent year-on-year between April and June. Ahead of the second quarter GDP data that will be released later this month, the ongoing slowdown trend forced the government to take many healing measures like slashing corporate taxes. The RBI took a slew of interest rate cuts.
As far as the government’s measures are concerned, the Finance Ministry took a slew of initiatives to boost growth. They include bank recapitalisation, the merger of 10 public sector banks into four, support for the auto sector, plans for infrastructure spending, tax benefits for startups etc. “However, none of these measures directly address the widespread weakness in consumption demand, which has been the chief driver of the economy,” Moody’s said.
New Delhi, Nov. 14: Vodafone Idea and Bharti Airtel on Thursday reported a whopping combined loss of nearly Rs 74,000 crore in the September quarter as the leading telecom players were hit by statutory dues arising from a recent Supreme Court ruling.
While Vodafone Idea posted a loss of Rs 50,921 crore — the highest-ever quarterly loss by any corporate in India—Airtel reported loss to the tune of Rs 23,045 crore.
Previously, Tata Motors had logged India Inc’s biggest quarterly loss of Rs
26,961 crore in the 2018 December quarter.
Vodafone Idea and Airtel have made provisions for their liabilities arising from the Supreme Court order in their latest September quarter results.
The apex court has upheld the government's position on including revenue from non-telecommunication businesses in calculating the annual adjusted gross revenue (AGR) of telecom companies, a share of which has to be paid as licence and spectrum fee to the exchequer.
Stung by colossal losses, Vodafone Idea said its ability to continue as a going concern is dependent on obtaining relief from the government and positive outcome of the proposed legal remedy.
The company is also in the process of filing a review petition against the Supreme Court order.
Vodafone Idea has estimated a liability of Rs
44,150 crore post the apex court order, and made a provision of Rs 25,680 crore in the second quarter of the current fiscal.
The company said it has
“accounted for the estimated liability of Rs 27,610 crore related to license fee and Rs 16,540 crore related to Spectrum Usage Charges up to September
30, 2019, including the interest, penalty and interest... Of Rs 3,3010 crore”.
In the second quarter of
2018-19, Vodafone Idea reported Rs 4,874 crore loss.
The company’s revenue in the three months ended September 2019 rose 42 per cent to Rs 11,146.4 crore.
Bharti Airtel posted a staggering Rs 23,045 crore net loss in the latest September quarter due to provisioning of Rs 28,450 crore in the aftermath of the Supreme Court ruling.
The company said its net loss were on account of exceptional charge pertaining to provisioning of Rs 28,450 crore towards the AGR dues, that included principal of Rs 6,164 crore, interest of Rs 12,219 crore, penalty of Rs 3,760 crore, and interest on penalty of Rs 6,307 crore.
Airtel CEO for India and South Asia, Gopal Vittal hoped that the government will take a considerate view on the adjusted gross revenue (AGR) matter given the “fragile state of the industry”.
“On the AGR verdict of the Supreme Court, we continue to engage with the government and are evaluating
various options available to us,” he said.
The consolidated revenue of Bharti Airtel was up by
4.7 per cent at Rs 21,199 crore in the just-ended quarter.
As per latest estimates by Department of Telecommunications, Bharti Airtel faces a liability of around Rs 62,187 crore (including share of Tata Group of companies and Telenor India), while Vodafone Idea may have to pay about Rs
54,184 crore.
The remaining liability is with state-owned BSNL/ MTNL and some of the shut/ bankrupt telecom companies.