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RBI crackdown triggers crash in Kotak Bank shares

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Mumbai, April 25 (IANS) Shares of Kotak Mahindra Bank crashed by as much as 12 per cent in morning trade on Thursday to Rs 1,620 on BSE as investors dumped the stock following the RBI crackdown on the lender.

The RBI had, on Wednesday evening, barred Kotak Mahindra Bank, with immediate effect, from taking on new customers and issuing fresh credit cards.

Infina Finance, one of the promoter group entities of Kotak Mahindra Bank had donated electoral bonds worth Rs 60 crore to the BJP. However, the RBI has taken stringent action against the bank to protect the interest of consumers.

The RBI order said business restrictions on Kotak Mahindra Bank have been imposed in the interest of customers as the Uday Kotak-controlled bank was assessed to be deficient in its IT Risk and Information Security Governance.

The RBI said that stringent action has been taken to protect consumers and to prevent any possible prolonged outage which may seriously impact not only the bank’s ability to render efficient customer service but also the financial ecosystem of digital banking and payment systems, according to the RBI order.

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“In the absence of a robust IT infrastructure and IT Risk Management framework, the bank’s Core Banking System (CBS) and its online and digital banking channels have suffered frequent and significant outages in the last two years, the recent one being a service disruption on April 15, 2024, resulting in serious customer inconveniences.

“The bank is found to be materially deficient in building necessary operational resilience on account of its failure to build IT systems and controls commensurate with its growth,” the RBI order states.

The RBI investigation into the operations of the bank revealed serious deficiencies and non-compliances in the areas of IT inventory management, patch and change management, user access management, vendor risk management, data security and data leak prevention strategy, business continuity as well as disaster recovery rigour and drill.

–IANS

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Kashmir tourist arrivals likely to break all previous records

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Srinagar, May 30 (IANS) Tourist arrivals in Kashmir are set to break all previous records as more than 1.25 million tourists have already come here to date.

Officials of the local tourism department have said that over 12.5 lakh tourists have so far visited Kashmir and going by the present trend, the year 2024 is likely to break all previous records.

At present, all local hotels in Srinagar city, in the ski resort of Gulmarg and the hill stations of Pahalgam and Sonamarg are completely sold out till the middle of June.

“What is true of hotels in these places is also true of guest houses, homestays, houseboats on the Dal and the Nigeen Lakes and other such lodging facilities in Kashmir at the moment,” said an official here.

More encouraging this year is the fact that with the improved law and order situation and the prevailing peace, foreign tourists have started coming to Kashmir in good numbers.

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“We earn foreign exchange once the foreign tourists start coming to Kashmir. In addition to this, most of the foreign tourists are high-end tourists whose average spending during their stay is more than the average domestic tourists. Not that the domestic tourists do not include high-end guests. The few 5-star hotels we have in the Valley are also completely sold out these days and the majority of their guests are domestic spenders,” said a member of the Hoteliers Club of Kashmir.

Normally the tourist arrivals start coming down with the beginning of the annual Amarnath Yatra due to the heavy rush of pilgrims who come for ‘Darshan’ at the cave shrine situated 3888 metres above sea level in Kashmir Himalayas.

This year, Amarnath Yatra starts on June 29 and will conclude after 52 days on August 19.

Hoteliers believe that given the number of bookings being made presently, it is unlikely that the tourist arrivals would be affected by the ensuing Amarnath Yatra.

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One of the reasons for the unlikely fall in the number of tourist arrivals this year in Kashmir is the soaring temperature in the rest of the country.

“There are of course other hill stations like Shimla, Darjeeling and Nainital in the country, but they cannot match the tourist uptake capacity of Kashmir”, said a local tour and travel operator who has been in business for more than four decades.

At present, tourists are mainly coming to the Valley from Gujarat, Tamil Nadu, West Bengal and Maharashtra. Local tour and travel operators say the tourist flow from Delhi and Punjab will start in the middle of the next month.

The tourism industry is the second main industry in Kashmir after horticulture. While horticulture is believed to generate Rs 10,000 crore for the local economy, the tourism industry is believed to pump in another Rs 8000 crore annually into the local economy.

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While the earnings from horticulture are restricted to orchard owners, tourism sustains hoteliers, houseboat owners, Shikarawallahs on the Dal Lake, taxi operators, pony wallahs, tourist guides and travel operators in addition to handicraft artisans like shawl, carpet, wood carving and papier machie craftsmen.

–IANS

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OYO clocks 1st-ever profit in FY24 at Rs 100 crore, says CEO Ritesh Agarwal

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New Delhi, May 30 (IANS) Ritesh Agarwal, Founder and CEO of global hospitality chain OYO Rooms, on Thursday said the company registered its first profitable financial year in 2023-24, with net profit at Rs 100 crore.

Agarwal said in a post on social media platform X that these are provisional numbers, “but the audited financials will likely be close to these”.

He said the company’s maiden net profitable financial year was at nearly Rs 100 crore.

“This was our eighth consecutive quarter of a positive EBITDA and we also have a cash balance of about Rs 1,000 crore,” Agarwal mentioned.

In his X post, Agarwal further said that the global credit rating firm Fitch has taken note of the company’s improved performance and strong cash flows, “upgrading our credit rating”.

The OYO CEO said that he sees growth ahead not just in India with emerging travel trends such as premiumisation, spiritual travel, business travel and conferences, and destination weddings but also in other key markets of Nordics, South East Asia, the US and UK.

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“FY25 will clearly be even more exciting,” said Agarwal.

Meanwhile, the hospitality major will refile its IPO papers with the markets regulator Securities and Exchange Board of India (SEBI) after refinancing its existing $450 million Term Loan B (TLB) at a lower interest rate.

With this move, the company anticipates annual savings of $8-10 million in the first year and $15-17 million thereafter.

–IANS

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Monsoon arrives simultaneously in Kerala, northeastern states

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New Delhi, May 30 (IANS) The southwest monsoon has arrived simultaneously in Kerala and the northeastern states on Thursday, two days ahead of its expected date of June 1.

“Southwest monsoon has set in over Kerala and advanced into most parts of northeast India today, May 30, 2024,” India Meteorological Department announced in a post on X.

IMD had said on Wednesday that conditions were rapidly becoming favourable for the onset of the southwest monsoon over Kerala within the next 24 hours. This was a day earlier than IMD’s first forecast for the onset of the monsoon on May 31.

The influence of Cyclone Remal is reported to have accelerated the onset of monsoon over the northeast as well.

Normally, the monsoon arrives in the northeastern states of Arunachal Pradesh, Tripura, Nagaland, Meghalaya, Mizoram, Manipur, and Assam on June 5.

The onset of the monsoon in Kerala marks the start of India’s southwest monsoon season, which stretches from June to September, and accounts for over 70 per cent of the country’s annual rainfall.

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The monsoon plays a key role in the Indian economy as close to 50 per cent of the country’s farmland does not have any other source of irrigation. The monsoon rains are also crucial for recharging the country’s reservoirs and aquifers from which the water can be used later in the year to irrigate crops.

India has emerged as a key exporter of foodgrains but had to resort to curbing overseas shipments of sugar, rice, wheat and onions in order to increase domestic supplies and keep prices in check due to the erratic monsoon last year which hit farm production. A robust growth in the farm sector helps to keep inflation in check.

The India Meteorological Department (IMD) defines average or normal rainfall as between 96 per cent and 104 per cent of a 50-year average of 87 cm (35 inches) for the June-Sept season.

Apart from supplying food, the farm sector also plays a key role in providing a demand for industrial goods such as two-wheelers, fridges and fast-moving consumer goods (FMCG). An increase in agricultural production and incomes, therefore, apart from contributing directly to GDP growth also leads to an increase in industrial growth.

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–IANS

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Industry veteran Sharat Sinha appointed as CEO of Airtel Business

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New Delhi, May 30 (IANS) Telecom service provider Bharti Airtel, on Thursday, appointed Sharat Sinha as CEO of Airtel Business, with effect from June 3.

Sinha will report to Managing Director and CEO, Gopal Vittal, and will be a part of the Airtel Management Board, the company said in a statement.

“I am confident that Sinha’s broad global experience in product management and business leadership across many of the world’s leading technology companies will provide tremendous firepower to Airtel’s ambitions in rapidly growing our portfolio across connectivity and adjacencies,” said Vittal.

Sinha joins Airtel Business from Checkpoint Software Technologies, where he served as President of Asia Pacific.

He has earlier worked with tech companies like Palo Alto Networks, Cisco and VMware in various leadership roles.

“Airtel Business is a leader in the business-to-business (B2B) space offering marquee solutions to enterprises and I am delighted to join this passionate team as they continue to steer towards enhancing their leadership with future-ready technology innovations and solutions that deliver greater value to customers,” said Sinha.

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Airtel has over 500 million customers in 17 countries across South Asia and Africa.

–IANS

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RBI sees CPI inflation easing to 4.5 pc in 2024-25

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Mumbai, May 30 (IANS) The RBI has projected the country’s inflation rate, based on the Consumer Price Index (CPI), at 4.5 per cent for 2024-25 in the backdrop of an above-average monsoon expected this year and easing of supply chain pressures.

“Headline inflation moderated by 1.3 percentage points on an annual average basis to 5.4 per cent in 2023-24. The easing of supply chain pressures, broad-based softening in core inflation and early indications of an above normal southwest monsoon augur well for the inflation outlook in 2024-25,” the RBI said in its annual report released on Thursday.

However, the increasing incidence of climate shocks impart considerable uncertainty to the food inflation and overall inflation outlook. Low reservoir levels, especially in the southern states and the outlook of above-normal temperatures during the initial months of 2024-25 need close monitoring, according to the report.

“The volatility in international crude oil prices, the persisting geopolitical tensions and elevated global financial market volatility also pose upward risk to the inflation trajectory. Taking into account these factors, CPI inflation for 2024-25 is projected at 4.5 per cent with risks evenly balanced,” the report states.

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The RBI has also highlighted the need to continue with the existing monetary stance to keep inflation under control.

“As the path of disinflation needs to be sustained till inflation reaches the 4 per cent target on a durable basis, the MPC (Monetary Policy Committee) in its April 2024 meeting, kept the policy repo rate unchanged at 6.50 per cent and noted that monetary policy must continue to be actively disinflationary to ensure anchoring of inflation expectations and fuller transmission. The MPC also decided to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns to the target, while supporting growth,” the report observes.

The Reserve Bank said that it will remain “nimble and flexible” in its liquidity management through main and fine-tuning operations, both repo and reverse repo. It will deploy an appropriate mix of instruments to modulate frictional as well as durable liquidity to ensure that money market interest rates evolve in an orderly manner so that financial stability is preserved.

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–IANS

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