Govt re­pro­mul­gates or­di­nance to amend com­pa­nies law


New Delhi: The gov­ern­ment has re­pro­mul­gated an or­di­nance to amend the com­pa­nies law to fur­ther im­prove the ease of do­ing busi­ness and en­sure bet­ter com­pli­ance lev­els. The Lok Sabha passed the bill on 4 Jan­uary. The amend­ments would help re­duce the bur­den on spe­cial courts and bring down ap­pli­ca­ble penal­ties for small firms, among oth­ers.

The or­di­nance has amended 16 sec­tions of the Act so as to mod­ify the pun­ish­ments from fine to mon­e­tary penal­ties to ease the bur­den on the spe­cial courts. The amend­ments were ef­fected based on sug­ges­tions by a panel that re­viewed the of­fences un­der the Act. PTI

The prob­lem of plenty, in terms of flows, is ex­ac­er­bated by a prob­lem of scarcity as far as qual­ity stocks go. It’s the clas­sic “too much money chas­ing too few goods” prob­lem. Venkatesh Pan­cha­page­san, as­so­ci­ate pro­fes­sor of fi­nance at IIM Ban­ga­lore, says: “The lim­ited uni­verse of in­vestible stocks for in­sti­tu­tions is a prob­lem, and the fact that the mar­kets reg­u­la­tor isn’t do­ing any­thing to broaden the uni­verse just makes things worse. So we end up with a sit­u­a­tion where mu­tual funds are forced to buy stocks that they al­ready own.”

He and his stu­dents found that more than twothirds of new money for top eq­uity funds of two large fund houses went into their ex­ist­ing stocks. The study was over a two-year pe­riod from 2016-17. Pan­cha­page­san is on the same page as Bak­shi when he says, “It is a vi­cious cy­cle of flows driv­ing prices, which, in turn, brings in more flows.”


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