Paytm Payments Bank Floats RFP To External Auditors | NDTV Profit
- #PaytmPaymentsBank floats RFP to external auditors
- #BhartiAirtel plans to form a dividend policy
These and more top stories of the day on 'The Reporter'. #NDTVProfitLive
- #BhartiAirtel plans to form a dividend policy
These and more top stories of the day on 'The Reporter'. #NDTVProfitLive
Transcript
00:00 and KYC process. That's an NDTV Profit exclusive.
00:03 Finance Minister Nirmala Sitharaman blasts the opposition in the Parliament,
00:11 says that the Congress has put family first and brought the economy down to the fragile five.
00:16 NDA emphasized a nation-first policy.
00:19 PM Modi announces Bharat Ratna awardees. Former Prime Minister PV Narasimha Rao,
00:28 as well as Chaudhary Charan Singh will be conferred along with Agricultural Scientist Dr. M.S. Swaminathan.
00:35 Hello and welcome. You're watching The Reporter on NDTV Profit. I'm your host Pallavi Nahata and
00:49 as always on today's show, we aim to bring to you market news along with national and
00:55 international news makers. Now, before we move on with the show, let's see how markets have fared
01:00 today. Benchmark indices came off the day's low and ended range bound. My colleague Tamannah
01:06 Inamdar joins us for a quick market check. Tamannah, how did the markets fare today?
01:11 The market close on Friday was in the green, which would have been something that not everyone would
01:19 have predicted start of the day or at least mid-morning, where you saw a bit of a dive.
01:24 But overall a range bound day, which saw the Nifty ending at the 21,782 mark. The Sensex also up
01:32 not even half a percent. The big story of course through the day was the afternoon
01:38 jump up in the Bank Nifty, which has closed about a percent and a half up. In fact, the Bank Nifty
01:44 after having quite a poor week has ended the week well. I just want to quickly pull up a weekly
01:50 chart of the Nifty, Sensex and the Bank Nifty to get you a sense of how this entire week has been.
01:57 And for the Nifty, you've been marginally down, very, very tepid week, I would say. You started
02:02 off well, but not too much happening after that and not too much action overall in the Bank Nifty
02:08 as well. That's why I'm saying good recovery today. Week on week, the Bank Nifty was about
02:12 2 percent down. So if one part of the story, one side of the story was the Bank Nifty,
02:18 the other side of the story today is how the broader market seemed to crack. In fact, I would
02:22 say the small cap and mid cap indices recovered from the worst levels of the day. The Nifty mid
02:27 cap has ended up closing about a percentage down, but was definitely worse off by a percent and a
02:33 half, nearly 2 percent down at some point. The small cap index has also seen a bit of a crack.
02:38 And the culprits here seem to be public sector run stocks. One sector or one set of companies,
02:45 which have been having a great time today were dumped by investors. Some of it is based on what
02:52 their results look like. And the biggest culprit there is PFC. The guidance outlook for this
02:58 company has been reduced quite dramatically. That was revealed in the con call by the management
03:02 the night before. And that's why you've seen an 8.5 percent drop. RSE follows in the footsteps,
03:08 but overall a bout of weakness there in public sector stocks. The trend this entire week has
03:15 been action depending on corporate results. And that's likely to continue next week as well as we
03:21 head towards the close of quarterly results season. And with that, it's time for an NDTV Profit
03:28 Exclusive, an update on the Paytm Payments Bank saga. The bank has now floated an RFP to external
03:35 auditors. We have my colleague Pragati Oberoi joining us with more on this. Pragati, what have
03:40 you been picking up? We have an NDTV Profit Exclusive for you. Sources have communicated
03:46 to us that Paytm Payments Bank has floated an RFP. And now RFP stands for request for proposal.
03:53 Paytm Payments Bank has floated this RFP to external auditors specifically. Now this RFP
03:59 has been floated on a restricted basis. This means that this RFP is not available in public domain.
04:05 Now the idea behind floating this RFP coming from Paytm Payments Bank is that it is for
04:10 audit of compliance and the KYC processes. Sources have also told us that by floating this RFP,
04:16 the bank wants to indicate or show to the RBI that it was compliant all throughout. We must
04:22 remember that when RBI imposed restrictions on Paytm Payments Bank and came out with the circular
04:27 on 31st January, the RBI said that it had found Paytm Payments Bank persistently non-compliant
04:34 and material supervised and booked it for material supervisory concerns. But now with the floating of
04:40 this RFP, Paytm Payments Bank is trying to take an action against what has been imposed by RBI.
04:47 Stay tuned for more updates. Thanks a lot for that Pragati. Now moving on to another related
04:53 piece of information. The Employees Provident Fund organization has said that it will stop
04:58 accepting claims linked to Paytm Payments Bank limited accounts from February the 23rd. My
05:05 colleague Janani Janardhanan joins us with more on this. Janani, what does this mean for Paytm
05:10 Payments Bank and its customers? The Employees Provident Fund organization is going to halt
05:18 payments for the settlement in accounts that are coming from the Paytm Payments Bank.
05:23 Now this is on the back of the regulatory curves imposed by the RBI and what we're getting to hear
05:29 so far is that Paytm Payments Bank linked deposit and credit transactions will be stopped. Now this
05:35 is via a circular that was issued by the EPFO to its field officers asking them that in line with
05:41 the RBI's actions, restrictive actions, that this must be carried out. The date that this comes into
05:48 effect is most important. That is going to be from the 23rd of February. That still is quite a bit of
05:55 time and also we've been noticing that the field officials have been noted that this should be made
06:03 more public, more awareness should be raised on the subject and it also gains a lot of importance
06:10 considering that it's been less than a year since Paytm Payments Bank was even given the approval
06:16 for settlement. This dates back to November 2023 when ATL Payments Bank and Paytm Payments Bank
06:22 were given the approval to be used for settlement purposes. Now the latest we have been reporting
06:28 at NDTV has been that independent director and board member Manju Agarwal also resigned with
06:34 effect of 1st February. So there doesn't seem to be any let up on what's happening currently at
06:39 Paytm Payments Bank but we'll bring you more on that as we learn further. We expect our margins
06:45 to improve in the fourth quarter on the back of new product launches. Now that's according to
06:51 Siddhartha Mohanty, chairman of LIC while he was in conversation with my colleague Sajid Mangat.
06:58 He added that the next quarter is going to be LIC's time and that the insurance major is focusing
07:04 on alternate distribution models. Let's listen into a slice of that conversation.
07:10 Whatever commitment we made post listing we are in line with achieving our commitment
07:17 and much more than that we are delivering and particularly if you see LIC was traditionally
07:23 power dominated power dominated product was there and there has been directional change
07:32 in our approach to business and we have good product mix. We have introduced good non-par
07:40 products which not only gives margin but also takes care of customer gives competitive return
07:46 in the market because when we design anything focus is always on customer all others will come
07:52 next because customer is the biggest stakeholder for us. So recently if you see we have launched
07:59 one product Jeevan Utsav and that has also given good margin during last quarter Q3 and that product
08:08 is designed in such a manner that takes care of all the stakeholders. Customers first then
08:15 distribution intermediaries their compensation and also shareholder margin. So other products
08:23 also we have launched recently Jeevan Dhara 2. Recently we launched ULIP plan LIC's index plus.
08:32 So all these products keeping in mind customers need as well as shareholders interest. This year
08:40 will be huge growth will be there. And that's what is you know giving you confidence that the
08:46 V&Vs will be. Totally confident because you see first two quarters we had some stress. Yes. Q1
08:55 and Q2. Q3 and Q4 will be LIC's time. You see if I share one data actually we made a study new
09:04 agents which we recruit. Every year we recruit more than a lakh agents. Out of that you will
09:11 find if age wise classification if you do more than 48 49 percent agents they are millennials.
09:20 So we are adding youngsters to our distribution channel. Old agents are there because agency is
09:27 one profession where nobody retires. Agents don't retire as long as they continue they get gratuity
09:34 also. They have term insurance various benefits are there. Many agents are totally full time
09:39 agents. So there are senior agents but new agents are regularly added. Now moving on one of the
09:46 stocks in focus in today's trade was Zomato. The stock closed over 3 percent higher after
09:52 analysts hiked target price after the company's earnings came out. My colleague Mahima joins us
09:58 with more. Mahima what are brokerages saying on the stock. Right. So Zomato touched an intraday
10:04 high of 5 percent today as brokerages have maintained positive calls on the company after
10:10 their net profit for Q3 jumped nearly fourfold. Let's just discuss what the brokerages are saying.
10:18 First one is Jefferies. Jefferies has maintained a buy on Zomato and it has hiked its target price
10:23 to 190 to 205 from 190 and it has also raised its adjusted EBITDA by 4 to 10 percent. Now then we
10:31 have Nomura which has again upgraded its rating from reduced to add and hike the target price to
10:37 180 from 75 which is nearly doubled and it also expects its food delivery to deliver 18 to 25
10:44 percent year on year growth. Then we have HSBC which is again maintained a buy and raised its
10:48 target price to 163 from 150. Then we have Motilal Oswal which has also raised its target price to
10:55 170 implying an upside potential of 18 percent and it expects Zomato to deliver a strong 70
11:01 percent year on year growth in FY24. We have Morgan Stanley also which has maintained an
11:06 over rate and raised its target price to 150 from 140 with an upside potential of 7 percent.
11:12 And lastly we have Bank of America which has maintained a buy rating and raised the target
11:16 price to 172 from 145. So all these brokerages have raised their target price considering the
11:22 current Q3 earnings that the Zomato posted. Thanks a lot for that. Now in today's parliament
11:30 session Nirmala Sitharaman discussed the white paper that was laid out by the government yesterday.
11:37 It details some of what the government has done during the course of the past decade pulling out
11:44 the Indian economy from the fragile five and pushing it to among the top performing economies
11:51 globally. She goes on to say that if the government handles situations with sincerity, transparency
11:57 and putting the nation first, results are there for everybody to see. Listen in.
12:01 Both the decades suffered because of some serious global crisis.
12:14 There are stark stories of how when you have a crisis and how a government with a feeling of
12:26 the nation will have to pull the economy up in spite of it getting affected by such a stark,
12:34 very difficult, challenging crisis. Ten years of one government with some crisis and ten years
12:43 of a different government with a different crisis. The comparison shown in this white paper clearly
12:50 says how if the government handles it with true sincerity, transparency and putting the nation
13:02 first, the results are there for everybody to see. Equally, when you don't put the nation first,
13:12 when you put your first family first and when you have other consideration than transparency,
13:23 the results are out there for you to see. So what happened after 2008
13:37 when there was a global financial crisis and what happened post the COVID shows clearly
13:45 that if the intent of the government is sincere, if the intention and rules are both correct,
13:55 the results will be good. When your intentions are not clear and your actions are not clear,
14:21 the demand by NBFCs to become more like banks is uncharacteristic. That's according to RBI
14:28 Deputy Governor Rajeshwar Rao while speaking at an event organized by the CII. He further
14:34 distinguished between regulatory implications between a bank and an NBFC. He added how not
14:40 letting an NBFC accept public deposits helps them have easy entry and exit barriers.
14:46 Listen to what he had to say. In a nutshell, what I would like to emphasize is that the
14:53 regulations for NBFCs, especially in the upper layer are much more calibrated but are certainly
14:59 not on par with the regulations applicable to the banks. Now there is always the perennial debate
15:05 which goes on whether NBFCs should be allowed to accept public deposits. This is the second issue
15:11 which I would like to discuss here. While the perception that the scale-based regulatory
15:16 framework has made regulations of banks more bank-like, there have also been intermittent
15:21 demands that NBFCs should be allowed to accept public deposits. Let me emphasize that the
15:28 non-acceptance of public deposits by NBFCs is one area which has actually provided regulatory
15:35 comfort to RBI to have lower entry barriers for the NBFCs, allow them to specialize in any sector
15:43 of their choice and have lower exit barriers to wind up their business. Acceptance of deposit in
15:49 whatever manner and form necessitates existence of a macro-financial safety net, including deposit
15:56 insurance and central bank liquidity backstops. These safety nets come with increased regulatory
16:03 rigor and intense supervisory oversight. The NBFCs have evolved as niche companies,
16:10 serving specific economic functions and it is uncharacteristic for them to demand becoming
16:16 like a bank. And with that it's time to slip into a very short break, but stay tuned,
16:22 we have a lot more lined up for you on the other side.
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