NHPC seeks Navratna status

State-owned NHPC, which has embarked on ambitious expansion plans, has approached the government seeking 'Navratna' status that would provide the power producer more leeway in investment decisions. The move comes at a time when NHPC, the country's largest hydel power generator, has firmed up plans to foray into thermal, solar and wind energy segments."We have submitted the proposal seeking Navratna status to the government," a senior official told. The proposal was submitted to the Power Ministry, which has forwarded the same to the Department of Public Enterprises (DPE), the official said.DPE, the nodal agency for public sector undertakings, comes under the Ministry of Heavy Industries and Public Enterprises. According to the official, Navratna status would provide the company with more autonomy and flexibility in deciding on investments. Currently, NHPC is a 'Mini Ratna Category-I' enterprise. Established in 1975, the company has an authorised share capital of Rs 15,000 crore. The company raked in a net profit of Rs 2,348.22 crore in the last financial year. 'Navratna' status provides for greater autonomy and more powers to the company's board, especially on investment decisions.Among others, the board of a 'Navratna' company can decide on investments worth up to Rs 1,000 crore in a single project without going for government approval.As per the guidelines for such entities, the ceiling on investment to establish financial joint ventures and wholly owned subsidiaries in the country or overseas shall be 15 per cent of the company's net worth in one project limited to Rs1,000 crore. At present, there are about 14 Navratna companies. NHPC has an installed power generation capacity of 5,702 MW, including 1,520 MW implemented through joint ventures. Seven projects, having total capacity of 4,095 MW are under construction.Moving forward with its diversification agenda, NHPC would be developing a 1,320 MW thermal power project alongwith Chattisgarh government in that state. Besides, plans are on the anvil for developing grid connected 50 MW wind and 100 MW solar power projects. "NHPC has been allowed to plan, promote and organise an integrated and efficient development of power through conventional and non-conventional sources in India and abroad," Director (Finance) A B L Srivastava had said earlier.

FPIs to get registration within 10 days

Making it easier for overseas entities to invest in Indian markets, Sebi has proposed grant of registration to them within 10 days of application under the new Foreign Portfolio Investor (FPI) regime.The FPIs would be allowed to invest across a host of the capital market segments, including in shares, debentures,warrants, mutual funds, collective investment schemes, derivatives, treasury bills and government securities. Besides, they can also invest in the commercial papers, security receipts of asset reconstruction companies, perpetual debt instruments, non-convertible debentures, infrastructure debt funds and Indian Depository Receipts.However, one FPI can hold a maximum of 10 per cent equity shares in a company, subject to the applicable sectoral caps.Under the proposed FPI Regulations, which were approved by Sebi's board yesterday and would be notified soon, various investor classes like FIIs (Foreign Institutional Investors) and QFIs (Qualified Foreign Investors) would be clubbed into one single category to be known as FPIs.To make it easier for FPIs to invest in Indian markets,the new norms also provide for a permanent registration tothem, while Sebi has also exempted the lowest-risk foreign investors (such as government entities, sovereign funds and multilateral agencies) from any registration fees.The new norms come at a time when concerns are being raised about flight of overseas funds away from Indian markets, which was known as among the most attractive investment destinations across the world till a few years ago.The regulations governing foreign investors have been streamlined to make Indian market a more attractive investment destination and include easier entry norms and cost-effective operational framework for the foreign entities.As per the draft FPI Regulations, 2013, the FPIs would need to apply for registration through Designated Depository Participants (DDPs), which would need to dispose of the application within ten days of its receipt.In case of additional information being sought for the registration, the application would be required to be disposed of within 10 days of such details being furnished. The applicants can approach Sebi for any grievance with regard to their application, while they would be required to be given a "reasonable opportunity" to remove any deficiencyfound in their application before it being rejected. An applicant can apply to Sebi for a reconsideration within 30 days of its application being rejected. The draft norms also stipulate that FPIs would need to transact in securities only through registered stock brokers, except for transactions in securities governed by RBI regulations (such as government bonds), open offers, buyback or delisting offers and divestment of shares. To ring-fence the new regulations from possible misuse,the FPIs would need to be from countries that are member of global bodies like Financial Action Task Force (FATF), IOSCO(International Organisation of Securities Commissions).Besides, the entities from any country against which bodies like FATF have issued warning for AML/CFT (Anti MoneyLaundering and Combating the Financing of Terrorism) deficiencies would not be allowed to register as FPIs.As per the draft regulations, FPIs would need to inform Sebi about any penalty, pending litigations or proceedings orinvestigations for which action may have been taken or can be taken by an overseas regulator against it.The FPIs would also need to obtain separate and distinct Permanent Account Number (PAN) from the Income Tax Department.In case the same set of ultimate beneficial owners invest through multiple entities, all such entities would be treated as part of same group and their investments would be clubbed together for the purpose of 10 per cent cap.They would also need to maintain propers books of accounts and records, while entities having opaque structuresto hide identity of beneficial owners would not be allowed to register as FPIs.The Sebi can also order inspections on suo motu basis or upon receipt of any complaint, to ensure that propers accounts and records, including telephone records and electronic records and documents, are being maintained, or to ensure compliance with the applicable norms. The Sebi would also be entitled to recover from the concerned entity the expenses incurred for the purposes of inspections and investigations.