#RBI policy on Recovery of Penal Charges on Loans…. #SBICards #ManappuramGold #MuthootGold #BajajFinance #NBFCs etc

Could be Negative for Credit card Cos, gold loan companies & Likes kd BajajFinance which charge high penal interest….
#Muthoot charges penal interest of upto 2% on schemes. Recall that their ROA is 6-7% so this Penal Interest is meaningful
#manappuramGold penal Interest Rates
#BajajFinance makes a very high NIM which is far in excess what banks make on similar personal loans. #BajajFinance has best high Penal Interest Charges of 3.5%.
Finally Credit Card Companies like #SBICards charge very high on PENAL INTEREST which partly explains the HIGH profitability of CreditCard companies despite giving free credit period.
So what will Banks/NBFCs do ? They will continue to Charge PENAL Charges but instead of PENAL INTEREST, they will make it PENAL FEES. Now PENAL FEES will attract GST.

SO WHO LOSES & WHO GAINS? If NET PENAL CHARGES remain Same to Financier, CUSTOMER now will pay EXTRA #GST
Lots of people who Read the THREAD came back to Clarify that the PENAL INTEREST on a loan was liable to GST. There was a clarification CBIC in June 2019 on this suggesting that charging penal interest was part of the Service (lending) it cannot be charged GST.
If you found this THREAD interesting, please for the Good of the general public #RETWEET it.

People should know that the ONLY thing constant in life is RISING TAXES under #Modinomics

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More from @TheFactFindr

Feb 12
What an #Insult to the people of #Kerala ?
A good sign of SAFETY in any state is the level of Women Education & the Level of Women in the INDUSTRIAL WORK FORCE. Women don’t go to work in INDUSTRY for two reasons - Education & Safety.
Of the 1.6 million women workers across India, 0.68 million (43 percent) were working in the factories of Tamil Nadu alone. In fact, nearly three-fourths (72 percent) of all women working in industries were employed in the four southern states of TN, Karnataka, AP & Kerala
Read 6 tweets
Feb 12
#DidYouKnow that #LithiumInIndia was DISCOVERED back in 1999. GSI published “Final report on Base Metals and Lithium in Salal Area... Field Session 1995-96 and 1996-97”. INSTEAD @PIB_India said “inferred estimate of lithium had emerged through field investigations since 2018-19”
It takes 500,000 gallons (2,273,000 litres) of water to mine one tonne of lithium. In Chile's Atacama Salt Flats, lithium mining has been linked to declining vegetation, hotter daytime temperatures and increasing drought conditions in national reserve areas.
I hope that India is careful the ENVIRONMENT impact of mining the #LithiumInJammu. We have seen what has happened in other countries as well what has happened the FRAGILE North East area due to massive building of Roads, Bridges & Tunnels
Read 13 tweets
Feb 11
Since you say that FUNDAMENTALLY a you have heard POSITIVE a things, pls tell me
1) Why is it that NO INSTITUTIONAL active fund managers Hold Adani Group Stocks with the exception of PORTS 2) AdaniGroup net Borrowing increased by 1 Lac CR in Fy22 (1.2 lac to 2.2 lac cr)
3) Please explain to me how Bankers were willing to lend to Adani Group companies with some where DEBT to EQUITY ratio of 8-49x ? Even the most leveraged groups go to max of 2x…
4) Please explain to me how a group which been making Negative Cash Flows as a whole and not even able to service interest costs was given more loans to acquire more assets ?
Read 4 tweets
Feb 9
#IMPORTANT The #MSCI Weight Reduction in #AdaniGroup is Just the Start of more events to come.

I highlighted the likelihood of #MSCI in the #THREAD BELOW
1/n what did MSCI Say ?
"MSCI has received feedback from a range of market participants concerning the eligibility"
“Characteristics of certain investors have sufficient uncertainty that they should no longer be designated as free float pursuant to our methodology.”
=> basically MSCI felt there is truth in what #Hindenburg portrayal of a "Close Relationship" with the FIIs
MSCI Also Said
"This determination has triggered a free float review of the Adani Group securities" which will be informed in Mid-feb and implemented by End-feb
Read 17 tweets
Feb 8
I personally know of a Operations consultant- a super guy - who was working on ACC and AMBUJA cost cutting programs for over 30 months starting 2019… Covid didn’t stop him but Covid just delayed his program which was to be taking just 18 months.
He was deputed by the previous CEO of HOLCIM India and the consultant worked on both ACC and AMBUJA. In his view ACCs plants had a structural problem which would keep the Gap between ACC and say ultra tech. So am surprised that after he left this COST improvement came in 6 months
There needs to be more explaining on what drove these sharp cost improvements.
Read 9 tweets
Feb 7
#SHOCKER !!

#Budget2023 #CAPEX growth of 30% Year over Year is just a game of #Smoke & #Mirrors (the hallmark of #Modinomics) .... if you recall, I mentioned that "Devil Lies in the Detail"
Entire Story in 1 Chart. Combines Central Govt & PSU Capex excluding dirty tricks. Image
@nsitharaman budget numbers for CAPEX includes items below
1) 50yr Loans to the States (much of this is consumption by state & double counted)
2) Loans to Food Corp India (Rations & MSP)
3) Capital Infusion is Loss making PSUs to pay Salaries & O/p Losses (BSNL, Air India) Image
These 3 items are NOT Capex .... so when does an Apples to Apples comparison, these adjustments needs to be made...

In short Central Govt & Off-balance sheet or PSU Capex is ONLY 3.8% of GDP (Lower than pre-covid) vs say 4.5% of GDP in FY10 Image
Read 9 tweets

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