Tag: Capital Markets
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Budget Impact
This year’s budget, termed by the media as a populist one, has received mixed reactions from the corporate sector. At the same time, it has not gone well with the stock markets, which fell following the budget announcements. The entire set of budget materials is available here. Now, we look at some of the key
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Taxation Issues in Short Selling
An earlier post on this blog had discussed the introduction of short selling in the Indian market and its implications on the market. Today’s Hindu Business Line has an article that refers to lack of clarify in the taxation regime with respect to short sales. Obviously, there seem to be several loose ends to tie,
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Analysing Foreign Currency Exchangeable Bonds (FCEBs)
When it came to borrowings in foreign currency, Indian companies hitherto had two options, namely (i) external commercial borrowings (ECBs) where they borrow monies in foreign currency, or (ii) foreign currency convertible bonds (FCCBs) where they issue bonds denominated in foreign currency that are convertible into shares of the issuer company. About a week ago,
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Lessons from the Turmoil
Today’s Business Standard carries an editorial that deals with possible regulatory responses to financial markets crises, a theme also addressed in a recent post on this blog. Here is an excerpt from the editorial: “The history of financial regulation shows such regulation is rooted in crisis. Significant regulatory change usually takes place in response to
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Miscellaneous: Stock Exchanges; Online IPO Applications
There are two pieces in the Economic Times today that deal with stock exchange operations and electronic settlement in IPOs. 1. Alternative Trading Systems The first is an op-ed by C K G Nair and M S Sahoo that explains the metamorphosis that the stock exchanges are undergoing. They write: “For the past few years
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More on the “Decoupling” Theory
The previous two posts (here and here) have argued that the “decoupling” theory, when it comes to emerging markets (like India and China), is a myth. Here is some additional analysis in an article in the Economist: “INVESTORS were until recently big fans of the “decoupling” theory, the notion that Asian economies can shrug off
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Stock Market Turmoil and the Role of Regulation
This is a cross-post from the Law and Other Things blog, to which also I contribute. Riding the downward tide of the global capital markets, Indian stock prices too tumbled 1,408 points on Monday, January 21, 2008 making investors poorer by $155 billion in a single day. The rout continued on Tuesday as well, before
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The Asian Stock Market Meltdown
The oft-repeated adage that goes “when America sneezes, the rest of the world catches a cold” was proven to be true once again when stock markets across Asia crashed, some to record levels. The Indian markets were not to be spared—the Sensex tumbled 1,408 points on Monday, and share prices continued to dive today on
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IPOs: Listing Day Price Band
Initial public offerings by companies are beset with the aspect of what is known as ‘underpricing’. This is when companies accessing the capital markets for the first time experience a significant jump in the stock price on the first day of trading. This works to the advantage of investors who have been allocated shares in
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Paving the Way for Short Selling in the Indian Market
Background At the outset, it may be useful to provide a brief background on the concept of short selling and its related jargon in very simple (and non-financially savvy) terms. Short selling is a sale of shares by a person without actually owning those shares. What occurs is that the seller borrows shares from someone
