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DoT nod for Rs 25k cr RJio-Brookfield tower deal

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Reliance Jio. (Photo: Twitter/@reliancejio)

The Department of Telecommunications has approved the Rs 25,215 crore deal between Reliance Jio and Brookfield Infrastructure.

A SEBI filing said: “The DoT through its letter dated August 11, 2020 has approved Rs 1,053.50 million downstream foreign investment for acquisition of the remaining 49 per cent of the paid-up equity share capital of Tower Co. from RIL by the Trust.”

Further, the department has also approved the increase in foreign investment in Tower Co. to 100 per cent of the paid-up equity share capital.

In December last year, Reliance Industrial Investments and Holdings Limited (RIIHL), a wholly owned subsidiary of Reliance Industries Limited (RIL) entered into an agreement under which it will receive Rs 25,215 crore investment by Canadian entity Brookfield Infrastructure and its institutional partners in its tower infrastructure trust.

As per the deal at the closing of the transaction, the trust will own 100 per cent of the issued and paid up equity share capital of Reliance Jio lnfratel Private Limited (RJIPL).

DoT gave the approval subject to the condition – “The Tower Co. shall ensure compliance with the InvIT Regulations” and “the investment of Rs 2,52,150 million by the Brookfield Sponsor and other investors into the Trust by way of the Issue should be in compliance with applicable FEMA rules and regulations and the InvIT Regulations”.

Further, the Rs 25,000 crore trust loan to be provided by the trust to the tower company should be in compliance with the extant provisions of the law.

The approval of the DoT is also subject to, amongst others, foreign investors not being provided any assured return on exit, compliance with pricing guidelines, documentation and reporting requirements of the Reserve Bank of India and compliance with other applicable laws, the filing said.

The Centre had sought the view of the Securities and Exchange Board of India (SEBI) on whether the debt-equity ratio of the deal is compliant with its guidelines for infrastructure investment trusts (InvITs). The approval was finally given after Jio clarified the doubts raised by the Ministry of Home Affairs, DoT and SEBI.

Business

Zomato shares decline 9%, market cap falls below 1L cr

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Shares of online food aggregator Zomato declined 9 per cent intraday on Friday.

Analysts are linking the decline with unsupportive valuations. Over the past one-month period, Zomato shares fell nearly 18 per cent.

Listed in July 2021, Zomato shares are, however, up more than 50 per cent from its IPO issue price of Rs 76. On Friday’s closing, it was at Rs 114 per share.

“The costs have escalated due to the tax imposed on the aggregator, along with the fact that the lockdown is also not currently happening, which also appears to be a weakness,” said Ravi Singhal, Vice Chairman at GCL Securities.

With Friday’s losses, the company’s market capitalisation fell below the 1 lakh crore-mark, NSE data showed.

According to Ravi Singh, Vice President and Head of Research, Share India Securities: “The technical setup in Zomato stock is in bearish formation on intraday and daily which may drag the stock up to Rs 112-110 levels in the near term.

“The valuations of the company are also not supporting the growth. Zomato is facing tough competition from Swiggy in many ways, mainly having a thinner Metro restaurant network and density versus Swiggy. We recommend investors to maintain the sell position in the stock.”

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Decline in equities continue for 4th straight sessions

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The 30-scrip Sensitive Index (Sensex) and broader 50-scrip Nifty on the National Stock Exchange (NSE) extended their losses from the previous three consecutive sessions and declined on Friday.

At 10.25 a.m., Sensex traded at 58,593 points, down 0.9 per cent from the previous close of 59,464 points. It opened at 59,039 points.

Nifty traded at 17,599 points, down 0.9 per cent from the previous close of 17,757 points. It opened at 17,613 points.

Bajaj Finserv, Tech Mahindra, Coal India, Adani Ports, Bharti Airtel were some of the top losers, NSE data showed.

Top gainers during the early trade were Hindustan Unilever, Tata Consumers, Bajaj Auto, Hero MotoCorp, and Power Grid Corporation.

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Business

Decline in equities continue for 4th straight sessions

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The 30-scrip Sensitive Index (Sensex) and broader 50-scrip Nifty on the National Stock Exchange (NSE) extended their losses from the previous three consecutive sessions and declined on Friday.

At 10.25 a.m., Sensex traded at 58,593 points, down 0.9 per cent from the previous close of 59,464 points. It opened at 59,039 points.

Nifty traded at 17,599 points, down 0.9 per cent from the previous close of 17,757 points. It opened at 17,613 points.

Bajaj Finserv, Tech Mahindra, Coal India, Adani Ports, Bharti Airtel were some of the top losers, NSE data showed.

Top gainers during the early trade were Hindustan Unilever, Tata Consumers, Bajaj Auto, Hero MotoCorp, and Power Grid Corporation.

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