RBI Imposes New Rules on “Free Usage Of Third Party ATM’s”

However, during August 2009 the apex bank had decided to put an end to this freedom. Mr.K Ramakrishnan, the Chairman of Indian Bank’s Association (IBA) has informed the press that RBI had given this communication to IBA and was expected to implement this during mid of October.

On October 15 2009, RBI had decided to curtail the use of Third party ATM’s. The following restrictions will be effective on the above said date.

• Maximum of 5 transactions per month will be allowed as free usage in a third party ATM.
• The sixth transaction will be charged.
• Anything above the cap limit of Rs.10k per withdrawal will not be allowed from any third party ATM’s

Free Usage of third party ATM's put to an END

Post April’s decision on free withdrawals in any third party ATM’s by RBI, other banks had approached RBI through Indian Bank’s Association stating that this has lead to a financial burden on the Banks as there were a huge number and small amount withdrawals from third party ATM’s. Henceforth,  the policy was revised to the set restrictions on every third party ATM withdrawals .

The Royal Bank Of Canada is said to be the biggest player in the banking industry in Canada. It accounts to 80k employees and serves almost 17 million clients.  The “Forbes Global 2000″ had ranked RBC in 55th position.

On September 29th 2009, J.P.Morgan Chase Bank sold the unit of Investment Advisor Servicing Business to the biggest giant of Canadian Banks – The Royal Bank Of Canada. The two banks signed an agreement here in Toronto for the deal of acquiring the IAS business of J.P.Morgan Chase Bank.

However, the closure procedures and the legal approvals  are expected to close by the second quarter of 2010. Post acquisition, the IAS business of J.P. Morgan Chase will be renamed and merged with the Royal Bank Of Canada’s Investment Advisory business.

J.P.Morgan Chase Sells out it's IAS Business to the Biggest Canadian Bank

No other details were leaked out by the Royal Bank Of Canada during the signing of the deal or agreement. RBC feels that this merger of IAS business is a sign of expansion in RBC’s  Wealth management business.

Dell Inc., a Multinational corporation and the largest seller and services of personal computers (PC’s) which employs almost 76,500 employees worldwide is second to Hewlett-Packard (HP). This Multinational IT firm has been listed 25th in the Fortune 500 company.

Dell is keen in Competing HP &IBM

On September 21st 2009, “Dell Inc.” has signed a deal worth $3.9 Billion with “Perot Systems Corporation”, an IT service provider company. The legal approvals were done on September 20th as agreed by the board of directors of both the IT firms. It seems the reason behind this move was because Dell had been loosing in front of it’s biggest competitor Hewlett- Packard (HP).

Dell Inc., by acquiring Perot Systems which made a huge revenue of $2.8 billion will be used as Dell’s service unit and also is set to compete it’s competitors HP and IBM. So Dell has now come up with a strategy of offering lower priced services when compared to it’s competitors. Dell is trying to make a mark in the IT service sector through the acquisition of Perot Systems which has good customer base and the major portion of revenue come from health care industry.

McCurry, started by Mr. P. Suppiah is a small family fast food restuarant in Malaysia, most poular in Kuala Lumpur serving indian dishes.

The Eight year battle Ended

McCurrry, started in 1999 by P. Suppiah along with his family members were sued by McDonald way back in 2001 for using it’s trademark of  ”Mc” prefix. This case was ruled in the High Court which was favouring McDonald. However, McCurry did not lose hope and took it to the Court of Appeal. It was further taken to final appeal - The Federal Court by McDonald.

On September 8, the final appeal was put to end by chief judge Arifin Zakaria thereby granting permission for McCurry to use the prefix “Mc” as this indian restuarant serves indian dishes in Kuala Lumpur and that the prefix stands for “Malaysian Chicken Curry”.

Now this was a victorious win for McCurry which won McDonald’s eight year battle.

On September 1, 2009, The major players in the Indian Steel industry – “SAIL (Steel Authority of India)” and “Tata Steel” announced their hike in the  steel prices on some of their products due to the progress in the demand.

“Flat Steel” Product’s Price Hiked

To go insinc with the steel prices globally, the major players in the domestic steel industry – SAIL and TATA has decided to hike their flat steel products.

“SAIL” has increased their steel prices by Rs.1,500 per tonne. The flat steel product’s especially the Hot Rolled(HR) and the Cold Rolled (CR) prices has been  hiked which are primarily consumed by the automotive industry and the white good industry. On the other hand, the long steel product’s price remains unchanged which are used by construction industries etc.

“Tata Steel”, the second largest player in the domestic steel industry, has announced that with effect from September 1,2009 the flat steel prices has been hiked by 3-4%. The increase in the flat steel prices ranges from Rs.1,250 to Rs.1,500 per tonne.

However, JSW Steel the third largest steel company in india among the private sector has not yet announced anything on the price hike.

Tata has ventured into diversified areas starting from water to coffee and so feels it has to be renamed soon. They are in the process of creating a new enterprise expecting a turnover of $10 billion five years ahead.

According to R.K Krishna Kumar, the vice-Chairman the new name and the logo of the company will be decided within two to three weeks by closely working on the rebranding strategy

Launch of Rebranding Campaign

After the Jago re rebranding campaign proposed  by Sangeeta Talwar, executive director, marketing - Tata Tea targeting the youth folks to emphasis that tea is not a mere drink but a youth drink to remain younger. This has given way for a new rebranding campaign.

They have now come with another social rebranding campaign called the “Corruption Campaign” with a tagline of “Aaj se khilana bandh, pilana shuru”. This 360 degree campaign will focus on how to avoid gettting into the corruption cycle.

Merge of wholly owned Overseas Subsidaries

Tata Tea plans to integrate it’s domestic and global operations. It has a long term plan for merging with it’s wholly owned overseas subsidaries like Tata Tea (GB) Ltd, Tata Tea Inc and Eight o’ clock Coffee Comapany. This restructure will result in six profit centers all over the globe. Tata Tea has moved there headquarters to London, though their registered office is situated at Kolkata.

According to the terms and conditions as proposed in the month of May09, it was agreed that though the two companies are having discussions to tie-up their business knots together, they would still remain as two different entities until they formally merge.

Sunil Bharti Mittal, the Chairman and the managing director of  India’s Leading Service providers “Bharti Airtel” is having tie-up talks with South Africa’s MTN Group and the outcome of this merger would be to acquire 49% of the shareholding of MTN. In turn, MTN group and it’s shareholders will be acquiring 36% of the economic interest in Bharti (25% will be held by MTN Group  and the rest will be held by it’s Shareholders).

If the two Telecom giants manage to tie-up business knots together, they would have a revenue of $20 billion with Sunil Bharti to concentrate on the business in the whole of Asia and MTN to concentrate on the Middle East and Africa.

On 17 August 2009, Reader’s Digest Association (RDA) the best- selling magazine in the USA had filed for a Chapter 11 Brankruptcy Protection.

The company says, it is planning to reduce it’s debt upto 75% and also tries to emphasis that the bankruptcy is only for US, while the business at other parts of the countries will remain unaffected.

HCL Technologies, one of top most IT Company in India had been working closely on the outsourcing contract worth $350 million with the US based best-selling magazine company – RDA(Reader’s Digest Association) says, this will neither impact their business  nor the relationship with RDA and will still continue to extend it’s support to RDA.

The opposite of  Inflation, “Deflation” is decline or fall in the price levels of commodities and services for a certain period of time due to the contraction or reduction of money and credit supply .

Whenever Inflation rate goes below zero percent or in the worst cases goes negative, it is said to be a state of deflation. Deflation can also be due to the reduced spending by both personal and government.

What does Deflation Do?

The other side of Inflation causes Deflation. During Deflation, Consumers or buyers will put their buying decision on  hold expecting the prices to go down further. Now let’s see what happens during Deflation;

• Increase in Money Value
• Increased demand for liquity
• Increased unemployment
• Economic slow down or Depression
• Reduced profit
• Increase in Purchasing power of money
• Decrease in demand of products & services

Deflation 2009

India being the third largest economy in Asia, fell into a state of deflation during the first week of June 2009. Inflation rate went negative to 1.61 percent during the first week of June per the Wholesale Price Index(WPI). This records to be the biggest in the last 30 years, per the Central bank.

“Reserve bank of India” had to slash its reverse Repo rate from 1 to 0.5 percent hoping to stabilize the economy.

So What is a SHARE?

A Share also known as stock is a financial asset, which can also be termed as an unit or part of ownership of a company. It is a document provided by the company which tells you the percentage of ownership of the company.

When you hold a certain percent of a comapany’s share, it means you are owning the company’s assets for that particular percentage. The one who owns the share is called the Share Holder.

Share Market – Basics

A Share market is a common place where an investor buys and sells shares of different companies. Like any other market, it is a place where buyers and sellers negotiate.

Issue Of Shares – Why???

Companies issue shares to the common public inorder to raise capital for multiple reasons such as

• to start a business (initial capital)
• to purchase new equipments
• to enhance their business
• to deversify their business etc.

Why Invest in Shares?

By investing in shares, you earn “capital gain” and “profit”. Say for example you buy a share at a lower price and sell when the price moves up.

Then you earn a capital gain and as a Share holder you are entitled to receive any profits the company make which is known as the dividend. A dividend is the earnings a company makes.

If you hold 10% of the company’s share, then you will be given 10% of the profit the company makes.

Risks involved in Investing

Share Market is an unstable platform. Share prices may vary on a daily basis. Due to fall and rise in the share prices, investors are affected. Indeed a high risk is involved when you invest your hard earned money in the stock market.

However, you can avoid certain amount risk by doing some ground work of studying the market behaviour for a certain period of time and invest in those shares which had a steady growth time to time.

So make a smart move for a  smart investment. Best of Luck!!!