SEBI doubles FX futures limits

Traders and brokers can now have a higher exposure in the currency futures market. Market regulator SEBI on Tuesday doubled the gross outstanding limit to $10 million for small traders, $50 million for brokers. However, the limits for banks -- the biggest participants in the market so far -- have been left untouched at $100 million.
However, banks are still not active in the segment since they have access to the over-the-counter (OTC) forex market that is much more efficient.
The change in regulations follow repeated pleas from market particpants saying that the existing limits were inadequate to effectively hedge their foreign currency exposure risks. Traders expect the move to deepen the market, by way of higher trading volumes.
Source:-Economic Times(25-Mar-09)

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RBI unveils details of bonds buyback auction

RBI said its proposed 100 billion rupees ($2 billion) buyback of bonds on Wednesday would include five securities.
The securities are: 7.38 percent 2015 bond; 8.24 percent 2018 bond; 7.94 percent 2021 bond; 8.24 percent 2027 bond and 8.33 percent bond maturing in 2036, it said in a statement late on Monday.
There will be no security-wise notified amount and it may purchase higher than the total notified amount due to rounding effects.
The buybacks, which have totalled 366 billion rupees since they started in February, are aimed to bring down rising yields and revive investor appetite.
Source:-Economic Times(24-Mar-09)

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Auditors may have the last word on a/cs

The era of qualified company accounts is about to close. Companies will have to restate their financial statements if auditors raise objections to any figure in annual accounts, if the government accepts a proposed recommendation of the Institute of Chartered Accountants of India (ICAI). Annual reports would contain financial statements that fully satisfy the auditor''s scrutiny.
This far-reaching proposal has been cleared by a special group set up by ICAI, which has been asked by the government to submit recommendations for improving financial reporting of companies. The ICAI will shortly transmit its recommendations on the subject to the government.
According to the proposal, a company that does not restate its accounts as suggested by the statutory auditor would be barred from paying dividends or raising loans. At present, an auditor''s scepticism about any portion of the accounts presented by a company is tagged along with the annual report and an investor has to work hard to correlate every auditor qualification with the number or numbers under challenge.
If the ICAI special group''s proposal goes through, this torture would be a thing of the past. Accounts would become more transparent, and the auditor would be taken far more seriously than at present by companies. The proposal forms part of a slew of measures to be suggested by the ICAI to the government so as to improve financial reporting standards in the country, said institute''s president Uttam Prakash Agarwal. The proposals could be implemented through amendments to the ICAI Act, a move, which has been mooted in the wake of the Satyam financial crisis. The proposed change would allow all stakeholders to get a easier grasp of a company''s balance sheet, as they will not have to correlate various numbers with the audit report. The proposal, which is being made in an attempt to make companies ''seriously act on auditors'' disagreements rather than merely acknowledging such disqualifications without any changes made to that effect is, however, not new in India.
Source:- Economic Times (20-Mar-09)
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SEBI proposes longer trading sessions

The Securities and Exchange Board of India (SEBI) is examining the option of extending trading hours on the financial exchanges to align these with international markets -- a move that drew mixed response from market participants.
"It is important to align Indian markets as far as possible with those of the international markets to facilitate the assimilation of any economic information that may flow in from other global markets," the market regulator said in a discussion paper released today. It has asked for feedback from market players by April 10.
Trading hours for the equity cash market and exchange-traded derivatives market in India are from 9:55 am to 3:30 pm, shorter than those for currency futures and commodity futures. But some exchanges in other countries have much longer trading hours for the futures segment, sometimes extending even up to 23 hours, the SEBI discussion paper pointed out.
SEBI said an extension of trading hours could enable the domestic market to take advantage of movements in international markets, make markets more efficient and attract trading interest.
Source:-Business Standard(20-Mar-09)
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NO SUPERSEDING :CLB wants four directors on Maytas Infra :One Of Them To Be Chairman

The Company Law Board on Friday suggested appointment of four independent directors on the board of Maytas Infra, including a chairperson, which was accepted by the Raju-family controlled company but opposed by the government.“I would appoint four persons on the board of Maytas Infra. Out of the four, one would be appointed as chairman. Let the appointed board take its course,” CLB chairman S Balasubramanian suggested during the hearing on the government’s plea to supersede the company’s existing board.

While this was accepted by the counsels representing Maytas Infra, the government counsel opposed the suggestion, pleading for sacking of the existing board. “The central government has no faith in the present management of the company. They themselves are denying any fraud in the company and now deciding who should be appointed on the board of the company,” the government counsel argued. Maytas Infra, listed on the stock exchanges, has seen resignations by its directors, following the confession by Satyam’s disgraced founder B Ramalinga Raju of cooking up the company’s books.

While RC Sinha, the non-executive director and chairman, resigned on January 9, the company’s CEO and director PK Madhav resigned on January 19. Of the three independent directors — CS Bansal has resigned, while CS Mohan passed away in November last year.

RP Raju is now the only independent director on the company’s board. And while Teja Raju continues as vice-chairman, the company had on January 30 appointed B Narasimha Rao (v-p contracts and claims division and head, corporate affairs) as a director.

Balasubramian refused to take any immediate decision on sacking the existing board and asked the government to furnish evidence supporting their demand. “You want to supersede at this stage, I disagree... Show me the material evidence. I want to see it before taking any decision. I have to follow principles of law and cannot go merely on allegations... Tell me incidences, how company is suffering? How they are not discharging their duties? How it has affected the public interest...,” the CLB chairman said.

IL&FS — that also holds a stake in Maytas Infra as Satyam promoter family pledged shares to them — suggested while the existing directors of Maytas should be allowed to continue, they should not be allowed to vote. “Let them contribute with their experience, but not vote,” said Ashok Desai, former Attorney General and senior advocate who appeared for IL&FS. However, this was opposed by the counsels of the Maytas Properties saying it would amount to indirectly superseding the board.
Source:- The Times of India 28 Feb. 09 Delhi P.27