Thursday 24 August 2017

Nifty, Sensex On Course to Head Higher – Weekly closing report-The Total Investment & Insurance Solutions

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24 August  2017

I had mentioned in last Friday’s closing report that Nifty, Sensex might head higher. The major indices of the Indian stock markets were alternately rallying and suffering a correction over the week in response to global cues and closed with minor weekly gains on Thursday over last Friday’s close. The trends of the major indices in the course of the week’s trading are given in the table below: The Total Investment & Insurance Solutions
 
Weekly Indices (The Total Investment & Insurance Solutions)
On Monday, negative global cues pulled the key Indian equity indices -- the NSE Nifty 50 and the BSE Sensex -- lower during mid-afternoon trade. According to market observers, subdued global benchmark indices coupled with foreign fund outflows eroded investors' risk-taking appetite. Selling pressure was witnessed in IT (information technology), healthcare and automobile stocks. On the NSE, there were 409 advances, 1,024 declines and 41 unchanged. Indian indices erased all the morning gains, as Asian and European indices turned negative in trade. The Total Investment & Insurance Solutions

TCS iON, a business unit of IT major Tata Consultancy Services (TCS), announced its partnership with the Institute of Company Secretaries of India (ICSI) to help foster digital learning opportunities for students. Ruia brothers-led Essar Oil announced the closure of the company's sale, including its Vadinar refinery, to Russian state-run Rosneft-led consortium for $12.9 billion. The deal includes acquisition of Essar Oil's (EOL) 20 million tonne Vadinar refinery in Gujarat and its retail outlets, as well as the Vadinar Port at an additional $2 billion. Essar Shipping shares closed at Rs28.90, up 12.89% on the BSE.

Positive global cues and value buying lifted the key Indian equity indices -- the NSE Nifty 50 and the BSE Sensex - higher during the mid-afternoon trade on Tuesday. According to market observers, positive Asian markets and "an initial spurt of value buying" enhanced the risk-taking appetite of investors.  Buying was witnessed in pharma stocks with Dr Reddy's Laboratories, Lupin, Sun Pharmaceutical Industries and Divi's Laboratories all trading in green. Lupin received establishment inspection report (EIR) from USFDA (United States Food and Drug Administration) for its Aurangabad facility. The US health regulator had carried out inspection in April. On the NSE, there were 556 advances, 1,082 declines and 320 unchanged.

Power utility major NTPC said that it plans to seek shareholders’ approval to raise Rs15,000 crore through the issue of bonds, debentures on private placement basis. The company will seek its shareholders approval for the special resolution during its annual general meeting to be held on September 20, 2017. On Tuesday, NTPC shares closed at Rs167.25, down 2.76% on the NSE.

Positive global cues pushed the key Indian equity indices -- the NSE Nifty 50 and the BSE Sensex -- higher during mid-afternoon trade session on Wednesday. According to market observers, buying in pharma, banking and IT (information technology) sector stocks supported equity indices' upward trajectory. The BSE Sensex and NSE Nifty opened higher on Wednesday against their respective previous session's close. The Indian rupee also opened on a strong note against the US dollar. Each of the three major indices on Wall Street (USA) posted their best one-day percentage gains in over a week ahead of the annual meeting of central bankers in Jackson Hole on Friday. On the NSE, there were 981 advances, 448 declines and 48 unchanged.


On Thursday, the market was listless, as there was no favourable global news for a rally and because there was a long three-day week-end ahead with a stock exchange holiday on Friday. On the NSE, there were 943 advances, 700 declines and 317 unchanged. At the close of trading on Thursday, the major indices closed with marginal gains over Wednesday’s close. Overall, the whole week’s trading has finished with marginal gains and the next week would have to show the real market trend. The market would head higher, if the week’s low is not broken.The Total Investment & Insurance Solutions

Right to Privacy is fundamental right: SC in an unanimous decision -The Total Investment & Insurance Solutions

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24 August  2017

SC(The Total Investment & Insurance Solutions)

The Supreme Court, in a landmark judgement on Thursday held that the right to privacy is a fundamental right and is an integral part of the right to life and liberty. While overruling two earlier judgements, the nine judge bench, in an unanimous decision said privacy comes under the right to life and liberty. .The Total Investment & Insurance Solutions

"The decision in MP Sharma, which holds that the right to privacy is not protected by the Constitution stands over-ruled. The decision in Kharak Singh to the extent that it holds that the right to privacy is not protected by the Constitution stands over-ruled. The right to privacy is protected as an intrinsic part of the right to life and personal liberty under Article 21 and as a part of the freedoms guaranteed by Part III of the Constitution," the Bench said in is judgement.

The Bench observed, "The decisions in MP Sharma and Kharak Singh adopted a doctrinal position on the relationship between Articles 19 and 21, based on the view of the majority in Gopalan. This view stands abrogated particularly by the judgment in Cooper and the subsequent statement of doctrine in Maneka. The decision in Maneka, in fact, expressly recognized that it is the dissenting judgment of Justice Subba Rao in Kharak Singh which represents the exposition of the correct constitutional principle. 

The jurisprudential foundation which held the field sixty three years ago in MP Sharma and fifty five years ago in Kharak Singh has given way to what is now a settled position in constitutional law. Firstly, the fundamental rights emanate from basic notions of liberty and dignity and the enumeration of some facets of liberty as distinctly protected rights under Article 19 does not denude Article 21 of its expansive ambit. Secondly, the validity of a law, which infringes the fundamental rights has to be tested not with reference to the object of state action but on the basis of its effect on the guarantees of freedom. Thirdly, the requirement of Article 14 that state action must not be arbitrary and must fulfil the requirement of reasonableness, imparts meaning to the constitutional guarantees in Part III."

According to the Supreme Court, the right 'to be let alone' represented a manifestation of 'an inviolate personality', a core of freedom and liberty from which the human being had to be free from intrusion. "The technology, which provided a justification for the need to preserve the privacy of the individual, was the development of photography.  The right to be let alone is a part of the right to enjoy life. The right to enjoy life is, in its turn, a part of the fundamental right to life of the individual," it said adding, "Natural rights are not bestowed by the state. They inhere in human beings because they are human. They exist equally in the individual irrespective of class or strata, gender or orientation." .The Total Investment & Insurance Solutions

During the hearing, senior counsels Gopal Subramanium, Kapil Sibal, Arvind Datar, Shyam Divan, Anand Grover, Meenakshi Arora, Sajan Poovayya and Jayant Bhushan represented the petitioners, with support from JS Attri, senior counsel for Himachal Pradesh. Attorney General KK Venugopal, represented the union government with suport from Tushar Mehta (Additional Solicitor.The Total Investment & Insurance Solutions

General), Rakesh Dwivedi, senior counsel for Gujarat, Aryama Sundaram for Maharashtra, Gopal Sankaranarayanan and Dr Arghya Sengupta. While some state governments have supported the stand of the Union government, others have supported the petitioners.

The Bench stated, "It was rightly expressed on behalf of the petitioners that the technology has made it possible to enter a citizen's house without knocking at his or her door and this is equally possible both by the State and non-State actors. It is an individual's choice as to who enters his house, how he lives and in what relationship. The privacy of the home must protect the family, marriage, procreation and sexual orientation which are all important aspects of dignity."

"If the individual permits someone to enter the house it does not mean that others can enter the house. The only check and balance is that it should not harm the other individual or affect his or her rights. This applies both to the physical form and to technology. In an era where there are wide, varied, social and cultural norms and more so in a country like ours which prides itself on its diversity, privacy is one of the most important rights to be protected both against State and non-State actors and be recognized as a fundamental right. How it thereafter works out in its inter-play with other fundamental rights and when such restrictions would become necessary would depend on the factual matrix of each case. That it may give rise to more litigation can hardly be the reason not to recognise this important, natural, primordial right as a fundamental right," it added. .The Total Investment & Insurance Solutions
The ruling by a nine-judge bench headed by Chief Justice JS Khehar will have a bearing on the challenge to the validity of the Aadhaar scheme on the grounds of its violating the right to privacy. .The Total Investment & Insurance Solutions

The nine-judge bench deciding this was constituted in August 2015 following a reference made in the Aadhaar or UID case (Puttuswamy & Anr WP Civil No. 494 of 2012) almost two years ago. A bench of nine judges including the Chief Justice of India, Justice Khehar, Justices Jasti Chelameswar, SA Bobde, RK Agarwal, Rohinton Nariman, AM Sapre, DY Chandrachud, SK Kaul and S Abdul Nazeer have heard the case. .The Total Investment & Insurance Solutions

Petitioners, activists, academics and lawyers sceptical of the Aadhaar project have been waiting since then for the resolution of the question of whether or not a fundamental right to privacy will be recognised by the Supreme Court. In the interim period, the Government blatantly violated prior orders of the apex court restraining the use and expansion of Aadhaar. As the project has grown, so has awareness of its multiple shortcomings and of the threat it poses to the security and welfare of the country. .The Total Investment & Insurance Solutions

Chronology of the case:

September 2013: SC tells Congress-led United Progressive Alliance (UPA) government that Aadhaar cannot be made mandatory for any services.
July 2015: Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA) Government tells SC that it plans to make Aadhaar mandatory for a range of services. Attorney General Mukul Rohatgi argues citizens have no fundamental right to privacy, shocking everyone. SC says a constitution bench will decide on this.

August 2015: SC limits use of Aadhaar to the Public Distribution System, only on voluntary basis
October 2015: SC allows Aadhaar to be used in four more schemes, purely on voluntary basis
March 2016: NDA Government passes Aadhaar Act as a money bill bypassing Rajya Sabha where it lacks majority. Pushes Aadhaar in over 50 schemes, making it mandatory.
June 2017: SC forms constitution bench to decide right to privacy, after a wait of nearly two years.
August 2017: The nine-judge Bench of SC upholds Right to Privacy as fundamental right.The Total Investment & Insurance Solutions

Google removes over 500 'spying' apps from Play Store -The Total Investment & Insurance Solutions

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24 August  2017

Google has removed over 500 apps that included mobile games for teenagers from its Play Store on account of a spyware threat. The Total Investment & Insurance Solutions

The decision came after US-based cyber-security firm Lookout discovered more than 500 apps that could spread spyware on mobile phones, Fortune reported late on Wednesday.

According to Lookout, the apps used certain software that had the ability to covertly siphon people's personal data on their devices without alerting the app makers.

The impacted apps included mobile games for teenagers, weather apps, online radio, photo editing, education, health, fitness and home video camera apps.

The researchers discovered that the 'Igexin' advertising software development kit (SDK) embedded in the apps caused these to communicate with outside servers that had earlier spread malware.

The bug in SDK was discovered when an app appeared to be downloading large, encrypted files from those servers. The Total Investment & Insurance Solutions


Many of the developers of the impacted apps were unaware of the security flaws, the report added.The Total Investment & Insurance Solutions

China Criticizes US Trade Probe As Protectionism-The Total Investment & Insurance Solutions

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24 August  2017

China's Commerce Ministry on Thursday criticized a U.S. decision to launch a trade probe of Beijing's technology policy as an attack on the global trading system and said it will "resolutely defend" Chinese companies.

Trade groups welcomed President Donald Trump's Aug. 14 order to look into whether Beijing improperly requires companies to hand over technology as a condition of market access. U.S. Trade Representative Robert Lighthizer announced a formal investigation this week. The Total Investment & Insurance Solutions

The action improperly applies U.S. law instead of international rules and is "the destruction of the existing international trade system," said a ministry spokesman, Gao Feng, at a news briefing.

"We are strongly dissatisfied with this unilateral and protectionist practice and will take all necessary measures to resolutely defend the legitimate rights and interests of the Chinese side and Chinese enterprises," said Gao.

Beijing requires automakers and other foreign companies in China to work through joint ventures, usually with state-owned partners. They often are required to give technology to partners that might become competitors.

More than 20 percent of 100 American companies that responded to a survey by the U.S.-China Business Council, an industry group, said they were asked to transfer technology within the past three years as a condition of market access. The Total Investment & Insurance Solutions

Foreign business groups complain companies are being squeezed out of promising Chinese markets or pressured to hand over technology for electric cars and other emerging industries.


Trump said in April he was setting aside trade disputes while Washington and Beijing worked together to persuade North Korea to give up nuclear weapons development. But American officials have resumed criticizing Chinese policy in recent weeks.The Total Investment & Insurance Solutions

Global Markets Push Ahead As Central Bankers Ready To Meet-The Total Investment & Insurance Solutions

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24 August  2017 

South korea stock markets (The Total Investment & Insurance Solutions)

Global stock markets were solid Thursday as investors awaited speeches by the world's top central bankers at Jackson Hole, Wyoming. The Total Investment & Insurance Solutions

KEEPING SCORE: In Europe, Britain's FTSE 100 rose 0.5 percent to 7,420. France's CAC 40 advanced 0.2 percent to 5,123 while Germany's DAX was up 0.3 percent at 12,222. Wall Street was headed for a solid opening with Dow futures and the broader S&P 500 futures up 0.2 percent. The Total Investment & Insurance Solutions

FED WATCH: Federal Reserve Chair Janet Yellen and other central bankers will assess the global economy at this week's annual conference in Jackson Hole, Wyoming. Yellen and European Central Bank President Mario Draghi are due to speak on Friday. No major policy changes are anticipated but traders remain cautious.

ANALYST TAKE: "Financial assets, whether it's equities, currencies, or fixed income, are trading in very tight ranges, and I expect such moves to continue throughout the day," said FXTM Chief Market Strategist, Hussein Sayed. "With the lack of tier one economic data, investors are bracing for some hints from the annual central bank gathering at Jackson Hole." The Total Investment & Insurance Solutions

ASIA'S DAY: Asian markets finished mixed. Japan's Nikkei 225 slipped 0.4 percent to 19,353.77 but South Korea's Kospi rose 0.4 percent to 2,375.84. Hong Kong's Hang Seng index advanced 0.4 percent to 27,518.60 while the Shanghai Composite Index fell 0.5 percent to 3,271.51. Australia's S&P ASX 200 added 0.1 percent to 5,745.50. Stocks in Southeast Asia were mixed. The Total Investment & Insurance Solutions
OIL: Benchmark U.S. crude oil fell 19 cents to $48.22 per barrel in electronic trading on the New York Mercantile Exchange while Brent crude, the international pricing standard, fell 15 cents to $52.42 per barrel in London.


CURRENCIES: The euro was down 0.1 percent at $1.18 while the dollar rose 0.3 percent to 109.39 yen.The Total Investment & Insurance Solutions

Wednesday 23 August 2017

Nifty, Sensex May Record More Gains - Wednesday closing report-The Total Investment & Insurance Solutions

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23 August  2017

I had mentioned in Tuesday’s closing report that Nifty, Sensex might rally a bit. The major indices of the Indian stock markets rallied on Wednesday and closed with handsome gains over Tuesday’s close. The trends of the major indices in the course of Wednesday’s trading are given in the table below: The Total Investment & Insurance Solutions
 
Major Indices (The Total Investment & Insurance Solutions)
Positive global cues pushed the key Indian equity indices -- the NSE Nifty 50 and the BSE Sensex -- higher during mid-afternoon trade session on Wednesday. According to market observers, healthy buying in pharma, banking and IT (information technology) sector stocks supported equity indices' upward trajectory. The BSE Sensex and NSE Nifty opened higher on Wednesday against their respective previous session's close. The Indian rupee also opened on a strong note against the US dollar. Each of the three major indices on Wall Street (USA) posted their best one-day percentage gains in over a week ahead of the annual meeting of central bankers in Jackson Hole on Friday. On the NSE, there were 981 advances, 448 declines and 48 unchanged. The Total Investment & Insurance Solutions

The Mukesh Ambani-led Reliance Industries Ltd (RIL) on Wednesday announced that it has become the biggest importer of ethane from the US in 2017, a development that follows the commissioning of the firm's ethane gas project at its Dahej manufacturing facility earlier this year. The ethane will be used as feedstock for RIL's cracker facilities at Dahej and Hazira in Gujarat and at Nagothane in Maharashtra. The company said the ethane shipments to RIL constitute 48% of total US exports. RIL shares closed at Rs1,582.05, up 1.44% on the NSE.
The Finance Ministry on Wednesday formally announced the launch of the new Rs200 note. "The central government hereby specifies the denomination of bank notes of the value of 200 rupees," a Gazette notification said. The notification has been issued under Section 24 of the Reserve Bank of India Act (RBI), 1934, and on the recommendations of the Central Board of Directors of the RBI. Earlier, Minister of State for Finance Santosh Kumar Gangwar told IANS that Rs200 note, printing of which had begun, would be in circulation soon. 

Reliance Capital Ltd, part of the Anil D Ambani-led Reliance Group, on Wednesday announced the launch of the Employees' Stock Option (ESOP) Scheme 2017. In a statement here, the company said that under the scheme it has granted ESOPs with a notional value of approximately Rs300 crore to 500 employees across its various group units, and eligible employees have received options on Reliance Capital listed stock and/or phantom shares of its unlisted operating businesses. The ESOPs comprise of 9,21,000 shares of Reliance Capital plus shares/ phantom shares of operating subsidiaries and associates. The grants have been approved by the Board of Directors of Reliance Capital and the respective group companies. The scheme is part of Reliance Capital's Rewards Programme aimed at retaining and incentivising key employees for their contribution to the growth and profitability of the company, the statement said. The shares of the company closed at Rs766.65, up 3.00% on the BSE.

Hindustan Copper Ltd (HCL) is focusing on Rs5,000 crore of expansion projects which will be executed over the next three to four years, a top company official said on Tuesday. "We are focusing on expansions projects over the next 4-5 years and the investment would be around Rs5,000 crore," company's Chairman KD Diwan told reporters here. Of the total investments, around Rs2,000 crore would be made in mining and rest for manufacturing of copper cathodes. Its Malanjkhand underground mine with a capacity of 50 lakh tonnes has been making progress and it is expected that the ore production will commence from December 2018, he said. "The investment for the project would be around Rs1,856 crore," an official of the company said. During the current financial year, it expects to make progress in mine development activity with the appointment of MDO for Banwas mine at Khetri. The company has obtained environment and forest clearances for its Kendadih and Rakha mine re-opening projects. The company’s shares closed at Rs62.05, up 1.72% on the NSE.

The top gainers and top losers of the major indices are given in the table below:
 
Top Gainer (The Total Investment & Insurance Solutions)

The closing values of the major Asian indices are given in the table below: The Total Investment & Insurance Solutions
Asian Indices (The Total Investment & Insurance Solutions)

Cabinet gives in principle nod for bank mergers-The Total Investment & Insurance Solutions

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23 August  2017
 
Arun Jaitley (The Total Investment & Insurance Solutions)
In the context of massive accumulation of bad loans by state-run banks, the Union Cabinet on Wednesday gave an "in principle" approval for their consolidation by merging some of the public sector lenders, Finance Minister Arun Jaitley announced.

"The cabinet approved the constitution of an alternate mechanism that will oversee proposals with regard to consolidation of banks, which will come from the PSBs (public sector banks)," Jaitley told reporters here following the cabinet meeting.

"As of today, there are 20 PSBs plus the State Bank of India (SBI)," he said, adding that the SBI had recently concluded the merger with its associate banks and become a larger consolidated entity. The Total Investment & Insurance Solutions

"If any other PSB board gives a consolidation proposal, to oversee that proposal an alternative mechanism will be in place to give in principle approval for the proposal of the banks for a scheme of amalgamation," Jaitley said. The Total Investment & Insurance Solutions

Explaining that such an alternative mechanism "enables quick facilitation of decisions", Jaitley said the constitution of the committee would be made by the Prime Minister.

"The decision regarding creating strong and competitive banks will be solely based on commercial considerations," he said. The Total Investment & Insurance Solutions

"Our experience of consolidation has been positive. It increases the entity's commercial strength, the ability to absorb market shocks," he added. The Total Investment & Insurance Solutions


The cabinet approval comes in the face of banking operations across the country being hit on Tuesday as over 10 lakh bank employees in more than 1,30,000 branches pan-India struck work protesting against reforms in the banking sector, including proposals of merger of state-run banks.The Total Investment & Insurance Solutions

RBI mulling over Ombudsman for NBFCs: RBI Dy Guv-The Total Investment & Insurance Solutions

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23 August  2017

The Reserve Bank of India (RBI) is considering an 'Ombudsman' scheme for redressal of customer grievances with the non-banking finance companies (NBFCs) even as the central bank is not in favour of the NBFCs taking deposits from public, Deputy Governor N.S. Vishwanathan said on Wednesday. The Total Investment & Insurance Solutions

"We are thinking of an Ombudsman scheme for the NBFCs so that people will feel they have a central bank regulated mechanism (for redressal). This would only strengthen customer confidence in the NBFCs", Vishwanathan said here while inaugurating an Non-Banking Finance Companies 2017 conference organised by Associated Chambers of Commerce and Industry of India (Assocham). The Total Investment & Insurance Solutions

"The RBI is also moving in the direction of harmonisation of regulatory frameworks for different types of NBFCs," he said. The Total Investment & Insurance Solutions

Referring to yet another key measure being planned by the RBI, Vishwanathan said: "We are moving in (for) harmonisation of different types of regulations for the NBFCs ...." 

He said there are several unfolding models which would keep evolving and "they would keep changing". The Total Investment & Insurance Solutions

However, the RBI is not in favour of the NBFCs taking deposits from the public, he said. 

These financial firms have recorded much higher annualised growth of about 14 per cent in credit against much lower by the banks. Even the asset quality of the NBFCs is far better than those of the banks. The Total Investment & Insurance Solutions

"The NBFCs are an important part of the financial inclusion and the RBI will continue to support them," Vishwanathan added. The Total Investment & Insurance Solutions


Nano is the cause of huge NPA loss for Tata Motors: Cyrus Mistry-The Total Investment & Insurance Solutions

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23 August  2017
 
Tata Nano (The Total Investment & Insurance Solutions)
Cyrus P Mistry, the ousted Chairman of Tata Group, has raised questions on Tata Motors' practice of lending without risk assessment especially to Nano and small commercial vehicle segment. "This caused a huge non-performing asset (NPA) loss in both Tata Motors and Tata Motor Finance, to the tune of nearly Rs4,000 crore. If we are to benchmark the gross NPA percentage as against any other finance company in the similar segment the difference would be in multiples. This easy finance, artificially bolstered the market share figures and as soon as this was reigned in, we saw a steep drop in the volumes of small commercial vehicles (SCV) and the Nano. In case of SCVs’, volumes fell by more than 50%," the Office of Mr Mistry said in a statement. The Total Investment & Insurance Solutions

Refuting certain observations made in the 2017 Annual Report of Tata Motors, the statement says, "Recently Tata Motors has raised large amount of capital from the shareholders, the company has not been able to pay dividends to its shareholders and is undergoing a huge retrenchment of its loyal employees, is wholly irresponsible of the Board not to take action so as to stem losses as soon as possible. I raise these issues with a view to ensure such decisions in the future are taken with due regard to the consequences on all stakeholder."

Talking about Nano, the Office of Mr Mistry says, the project as conceived was indeed brave. However, for a number of reasons, the car was not profitable for many years. "During my time as chairman of Tata Motors, we tried to make significant products improvements based on market feedback such as an openable tailgate, power steering and an AMT version. All these initiatives did not bare fruit. It was only then that a unanimous decision was taken to discontinue the Nano Production. It has been almost one year since then."

However, despite the decision, Nano production continued for next one year after the original decision was taken to discontinue it, the statement says, adding, "I had drawn attention to potential areas of conflict of interest in the supply of Nano body shells to Jayem motors where Mr Ratan Tata has made investments in his personal capacity, thus forcing the Nano production to continue on a subscale basis for almost one year after the original decision had been taken. As I understand the Nano today, continues to incur heavy losses. At the very least this continuous loss for nearly a year has depressed the share value by thousands of crores on the present PE multiple." The Total Investment & Insurance Solutions


The Office of Mr Mistry also raised question on the silence of the Board in sharing confidential information about Nano to Mr R Venkataraman. It says, "I am also surprised to see complete silence from the board when it comes to the issue of sharing confidential detailed cost information about the Nano Cars to Mr R Venkatraman who used to be on RNT (Mr Tata) associates and conflicted, which is substantiated by the e-mail trails in my submissions and available to the board."The Total Investment & Insurance Solutions