Investment Valuation in India

CREDIT DERIVATIVES are over-the-counter contracts that allow credit risk to be exchanged across counterparties. A CREDIT DEFAULT SWAP (CDS) is a swap contract in which the buyer of the CDS pays premium (periodic or lump-sum) to the seller and, in exchange, receives a payoff if a credit instrument - typically a bond or loan - goes into default (fails to pay). This event of a default is called a “Credit event”. The payment made by the seller to the buyer is called a “Contingent payment” and is triggered by a credit event (CE) on the underlying credit. These contracts represent the purest form of credit derivatives (hence called Plain Vanilla), as they are not affected by fluctuations in market values as long as the credit event does not occur. Plain Vanilla CDS cater to the largest market share of the Credit Derivatives typically with 5 year maturities. Credit default swaps are often used to manage the credit risk (i.e. the risk of default) which arises from holding debt. Typically, t...

The chapter 11 of the Bankruptcy Code provides (generally) for reorganization, usually involving a corporation or partnership. A chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time. People in business or individuals can also seek relief in chapter 11. Who files the petition A petition may be a voluntary petition, which is filed by the debtor, or it may be an involuntary petition, which is filed by creditors that meet certain requirements. The debtor also must file with the court: schedules of assets and liabilities; a schedule of current income and expenditures; a schedule of executory contracts and unexpired leases; and a statement of financial affairs Generally, a written disclosure statement and a plan of reorganization must be filed with the court. The disclosure statement is a document that must contain information concerning the assets, liabilities, and business affairs of the debtor sufficient to enable a cr...

THE SPECIAL ECONOMIC ZONES ACT, 2005 ESTABLISHMENT OF SPECIAL ECONOMIC ZONE (Extracts from SEZ Act, 2005) Procedure for making proposal to establish Special Economic Zone. 3. (1) A Special Economic Zone may be established under this Act, either jointly or severally by the Central Government, State Government, or any person for manufacture of goods or rendering services or for both or as a Free Trade and Warehousing Zone. (2) Any person, who intends to set up a Special Economic Zone, may, after identifying the area, make a proposal to the State Government concerned for the purpose of setting up the Special Economic Zone. (3) Notwithstanding anything contained in sub-section (2), any person, who intends to set up a Special Economic Zone, may, after identifying the area, at his option, make a proposal directly to the Board for the purpose of setting up the Special Economic Zone: Provided that where such a proposal has been received directly from a person under sub-section, the Board may g...

Transfer of Articles - IMPORTANT ANNOUNCEMENT The following decisions taken by the Council of the Institute are brought into force immediately for compliance by the Students / Members concerned. It is advised that required compliance be made by the concerned students / members. It may please be noted that non-compliance will be viewed seriously and proceeded against accordingly. The coaching classes shall not continue after 9.30 a. m. or start before 5.30 p.m. so as to enable the articled/audit assistants to concentrate wholly on practical training. Members of the Institute who are engaged in coaching be advised not to undertake coaching between 9.30 a.m. to 5.30 p.m. An articled assistant should undergo practical training in accordance with the guidelines of the Institute between 10:30 a.m. and 5:30 p.m. During the period an articled assistant shall not be permitted to attend colleges/other institutions for graduation or any other course. Every articled/audit assistant shall submit on...

How-are IT returns selected for Scrutiny Procedure for selection of cases for 'Scrutiny' for non-corporate assessees In super cession of earlier instructions on the above subject the Board hereby lays down the following procedure for selection of returns / cases of *Non-Corporate Assessees* for scrutiny during the financial year i.e. 2007-08 . 2. The following categories of cases shall be compulsorily scrutinized; - i) All assessment pertaining to search and seizure cases. ii) All assessment pertaining to surveys conducted u/s 133A of the Income tax Act. iii) [1]All returns where deduction claimed under Chapter VIA of the Income tax Act is Rs.25 lakhs or above in stations other than the cities on computer network. iv) All returns, including those of non-residents, where refund claimed is Rs.5 lakhs or above in stations other than the cities on computer network. v) (a) All cases in which the CIT (Appeals) or ITAT has confirmed an addition / disallowance of Rs.5 lakhs or above o...

The world's largest democracy in the world's biggest elections has given its mandate that it is the Congress which will be forming the next government in India. SINGH IS KING The Congress has led the UPA to win the 15th Lok Sabha elections yet again and Prime Minister Manmohan Singh has become the second prime minister after Jawaharlal Nehru to win the elections second time in a row. The results of the elections have been a pleasant surprise for the Congress and the UPA as hardly anyone would have expected the results to be so decisive with the BJP considered to a strong contenders this time. I need not highlight my personal views which are to the contrary and results have been as expected for me. The stability and strength of Sonia, political decency and image of Manmohan Singh and the youth appeal of Rahul has managed the Congress to bag more seats than expected. The just in time pre-poll strategy of Rahul Gandhi to field all political parties possible and an attempt t...

4 things to look for in an investment New investors are often interested in purchasing a company's stock but are not sure where to begin. These four characteristics should serve as helpful guidelines in your search for a good investment. 1. What is the price of the entire company? When doing research, it is important that you look at more than just the current share price - you need to look at the price of the entire company. The "cost" of acquiring the entire corporation is called market capitalization (or market cap for short) and is frequently referred to by financial professionals. In short, the market cap is the price of all outstanding shares of common stock multiplied by the quoted price per share at any given moment in time. A business with one million shares outstanding and a stock price of $50 per share would have a market cap of $50 million. This market capitalization test can help keep you from overpaying for a stock. Consider the case of eBay and General Mo...