Latest news with #SCRA
New Straits Times
13 hours ago
- Business
- New Straits Times
GFM buying 60pct Shapadu Energy stake for RM30mil
KUALA LUMPUR: GFM Services Bhd has entered into a conditional share sale agreement with Shapadu Corp Sdn Bhd to buy a 60 per cent stake in Shapadu Energy Sdn Bhd for RM30 million. The integrated facilities management (IFM) services provider said the proposed acquisition follows the heads of agreement by both parties in December 2024. GFM group managing director Ruslan Nordin said the proposed acquisition is a strategic step forward in scaling up the company's oil and gas FM capabilities and scope. Ruslan said it represents a key milestone in the company's long-term strategy to strengthen and expand its presence in this high-value segment. "By acquiring Shapadu Energy, we will gain access to an established customer base, resources, and expertise, particularly at the Pengerang Integrated Complex under the turnaround main mechanical and maintenance mechanical static (TA4MS) contract," he said. The strategic value of the proposed acquisition is further supported by the robust financial performance of Shapadu Energy's subsidiary SCRA, which holds the TA4MS contract. Over the past three years, SCRA demonstrated consistent revenue growth from RM37.2 million in the financial year ended December 31, 2021 (FY21) to RM114.7 million in FY24, representing 45 per cent compound annual growth rate. Upon completion of the acquisition, Shapadu Corp will have a 40 per cent stake in Shapadu Energy. Consequently, Shapadu Energy will become a 60 per cent-owned subsidiary of GFM and will remain an independently managed business unit under the company. The RM30 million acquisition will be paid entirely in cash. GFM said it intends to fund the acquisition through internally generated funds and/or bank borrowings, with the final composition to be determined at a later stage. The proposed acquisition is expected to be completed by the second half of 2025.
Express Tribune
22-06-2025
- Business
- Express Tribune
SBP seeks tax on foreign investment
Listen to article As the local currency comes under renewed stress, the State Bank of Pakistan (SBP) on Saturday proposed linking tax benefits with a minimum one-year retention period for foreign investments in government debt and equity markets to bring predictability in outflows. Dr Mohammad Ali Malik, an SBP executive, suggested the 10% reduced income tax rate should be tied to at least one-year retention of investment made through the Special Convertible Rupee Account (SCRA). He made the proposal during a meeting of the National Assembly Standing Committee on Finance, chaired by Pakistan People's Party (PPP)'s Syed Naveed Qamar. Federal Board of Revenue (FBR) Chairman Rashid Langrial said that investors were securing tax advantages by making short-term investments. He recommended a minimum six-month holding period for investments in Roshan Digital Accounts and other schemes to qualify for tax benefits. With this, the central bank seeks more predictable dollar outflows. However, the committee warned that such a move could deter investors, which the government could not afford. Dr Malik argued that the condition would not disrupt current inflows, as significant investments in treasury bills, government bonds, and SCRAs were not presently being made. He said linking tax incentives with long-term investments could help stabilise outflows. Under SBP regulations, non-residents may freely invest and trade in government marketable securities, including Pakistan Investment Bonds (PIBs), Treasury Bills (TBs), registered corporate debt instruments, and the Water and Power Development Authority (WAPDA)'s registered bonds through SCRAs. Following months of stability, the rupee has again come under pressure due to increased debt repayments. The rupee's value has depreciated to around Rs284 per US dollar in the interbank market, with even higher rates in the open market. A senior executive from a private commercial bank said large interbank transactions are being settled at nearly Rs3 above the average market rate. In an economic alert issued Saturday, advisory firm Tola Associates warned that ongoing unrest in the Middle East and Pakistan's reliance on imported oil posed serious risks of economic disruption. Crude oil prices, it stated, have surged over the past two weeks, rising from $63.76 on June 2 to $76.31 per barrel by June 19 due to the ongoing Gulf conflict. Tola Associates noted a dual inflationary impact on Pakistan's economy: higher crude prices widen the current account deficit and weaken the rupee against the dollar, which further fuels inflation. If crude oil hits $80 per barrel, the rupee may slide to Rs285.4 per dollar; if it rises to $100, the rupee could depreciate further to Rs292.1. In that case, local petrol prices may need to rise by Rs35 per litre, the firm said. The government has already formed a committee, chaired by Finance Minister Muhammad Aurangzeb, to review the implications of Israel's illegal act of war against Iran on Pakistan's economy and petroleum flows. Tola Associates said that the direct impact of higher crude prices on domestic petrol rates may further fuel inflation and make life more difficult for the people of Pakistan. It has estimated the additional impact of inflation by 1.8% in case crude oil price increases to $80 and 8.7% if the prices surge to $100. The current account deficit is also projected to widen to $4.3 billion in the next fiscal year, if crude oil hits $100 price. The standing committee also reviewed another proposal: taxing income from government debt investments even if withdrawn before maturity. Currently, some investors evade taxes by prematurely selling and rebuying securities — a tactic known as "coupon washing." The FBR proposed in the budget that tax be charged on the investment regardless of early withdrawal, estimating an additional Rs10 billion in revenue. However, the committee adjusted the proposal, reducing the required holding period from one year to six months. Last month, the FBR had discussed the coupon washing measure with the International Monetary Fund (IMF). But the IMF was sceptical that people who buy government securities do not pay taxes. Additionally, the committee approved raising the cash withdrawal threshold for non-filers — subject to a 0.8% tax — from Rs50,000 to Rs75,000. However, it rejected the FBR's recommendation to increase the tax rate to 1%, which had been 0.6% before the budget proposal.
Business Recorder
21-06-2025
- Business
- Business Recorder
Investment in SCRAs: 12-month holding period proposed for tax concession: FBR chief
ISLAMABAD: Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial Saturday said the FBR has proposed a holding period of 12 months for availing concessionary tax regime on investment made in Special Convertible Rupee Accounts (SCRA) under Finance Bill (2025-26). While review of Finance Bill (2025-26) on Saturday at the National Assembly Standing Committee on Finance, Chairman of the Finance Committee Naveed Qamar said that the condition of 'holding period' would discourage investment in the SCRA. The government should set 3-6 months holding period for making investment in the SCRA. The FBR chairman endorsed the viewpoint of Naveed Qamar. The FBR chairman said that we can propose six months holding period. The FBR has already discussed the proposal with the State Bank of Pakistan (SBP). In case of three months proposal, this should be subject to the approval of the Federal Cabinet. FBR directed to immediately stop sealing Tier-1 retail outlets MNA Mirza Ikhtiar Baig stated that the government must watch interest of the overseas Pakistanis making investment in the SCRA. Later, an official of the SBP joined the meeting online from Karachi. Muhammad Ali Malik, executive director SBP informed the committee that the proposed amendment has nothing to do with the Roshan Digital Account. The proposed change is related to the SCRA and not Roshan Digital Account. There should be some limitation of holding period for keeping investment in the SCRAs. We want to discourage short-term investments in the SCRAs. If they keep investment above one year period, the concessional tax regime should be applicable. To avoid volatility in market, the holding period should be one year for the purpose of making investment in the said accounts. The tax advantage should be given to those investors who would keep their investment for at least one year. According to the assessment of the SBP, there would be no immediate or significant impact on investment in case one year holding period is introduced, the SBP official added. The finance committee proposed six months holding period for availing concessionary tax regime on the SCRAs investments. Copyright Business Recorder, 2025
Economic Times
10-06-2025
- Business
- Economic Times
Zerodha's Nithin Kamath hails SCRA rule clarification for stock brokers, "huge" for Rainmatter. Here's why
Zerodha Founder & CEO Nithin Kamath on Tuesday lauded Indian finance ministry and NSE for clarification of SCRA rules enabling stock brokers to invest their own funds without exchange approvals or restrictions. Calling it huge for Rainmatter, an initiative by Zerodha which supports and invests in Indian startups, Kamath said that Zerodha will now be able to allocate more capital to support domestic startups directly from the brokerage entity. ADVERTISEMENT "Finally, after clarification of SCRA rules by @FinMinIndia and NSE, brokers can now invest their own funds without exchange approvals or restrictions. This is huge for @Rainmatterin. We can now allocate more capital to support Indian startups directly from the brokerage entity," Kamat tweeted on his official X handle. The government had in May, amended the Securities Contract (Amendment) Rules to give regulatory clarity and enhance ease of doing business for stock brokers. "Amendment gives regulatory clarity to enhance ease of doing business for brokers," the finance ministry said. Through a circular issued on May 16, the Ministry of Finance recently changed certain rules about how stockbrokers can invest their own money. The main point of the change is that when a stockbroker invests his own money, it will generally not be considered as part of their "broking business" subject to certain conditions.'Provided further that investments made by a member shall not be construed as business except when such investments involve client funds or client securities or relate to arrangements which are in the nature of creating a financial liability on the broker,' the clarification said. The government amended the rules by inserting this provision in Rule 8 of the Securities Contracts (Regulation) Rules, means they won't have to follow the same strict rules that apply to client-related transactions. ADVERTISEMENT However, there are exceptions to this rule. If the investments made by stock brokers involve client money or client securities, or if these investments create a financial risk for their brokerage firm, then these investments will still be treated as part of their business and subject to the usual rules.'Provided further that investments made by a member shall not be construed as business except when such investments involve client funds or client securities or relate to arrangements which are in the nature of creating a financial liability on the broker,' the clarification said. ADVERTISEMENT Also Read: Zerodha's MTF bet pays off, touches Rs 3,000 crore in 6 months despite a bear market: Nithin Kamath (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times) ADVERTISEMENT (You can now subscribe to our ETMarkets WhatsApp channel)
Time of India
10-06-2025
- Business
- Time of India
Zerodha's Nithin Kamath hails SCRA rule clarification for stock brokers, "huge" for Rainmatter. Here's why
Zerodha Founder & CEO Nithin Kamath on Tuesday lauded Indian finance ministry and NSE for clarification of SCRA rules enabling stock brokers to invest their own funds without exchange approvals or restrictions. Calling it huge for Rainmatter, an initiative by Zerodha which supports and invests in Indian startups, Kamath said that Zerodha will now be able to allocate more capital to support domestic startups directly from the brokerage entity. "Finally, after clarification of SCRA rules by @FinMinIndia and NSE, brokers can now invest their own funds without exchange approvals or restrictions. This is huge for @Rainmatterin. We can now allocate more capital to support Indian startups directly from the brokerage entity," Kamat tweeted on his official X handle. The government had in May, amended the Securities Contract (Amendment) Rules to give regulatory clarity and enhance ease of doing business for stock brokers. "Amendment gives regulatory clarity to enhance ease of doing business for brokers," the finance ministry said. Through a circular issued on May 16, the Ministry of Finance recently changed certain rules about how stockbrokers can invest their own money. The main point of the change is that when a stockbroker invests his own money, it will generally not be considered as part of their "broking business" subject to certain conditions. 'Provided further that investments made by a member shall not be construed as business except when such investments involve client funds or client securities or relate to arrangements which are in the nature of creating a financial liability on the broker,' the clarification said. The government amended the rules by inserting this provision in Rule 8 of the Securities Contracts (Regulation) Rules, 1957. This means they won't have to follow the same strict rules that apply to client-related transactions. However, there are exceptions to this rule. If the investments made by stock brokers involve client money or client securities, or if these investments create a financial risk for their brokerage firm, then these investments will still be treated as part of their business and subject to the usual rules. 'Provided further that investments made by a member shall not be construed as business except when such investments involve client funds or client securities or relate to arrangements which are in the nature of creating a financial liability on the broker,' the clarification said. Also Read: Zerodha's MTF bet pays off, touches Rs 3,000 crore in 6 months despite a bear market: Nithin Kamath
