It was a day of speculation and concern on the bourses that saw the benchmark index shed almost 2%, highlighting the bear grip on the market. There were concerns that the BJP dominance in Karnataka may be replicated at the Centre and speculation that the government is likely to take a relook at the Double Tax Avoidance Treaties with several countries like Mauritius.

There is a perception that the government is losing out on revenue on account of the treaty as corporate houses are routing their businesses through a tax heaven like Mauritius. (Its estimated that India loses a revenue of at least Rs 1,000 crore per year because of the Indo-Mauritius treaty.) Taxmen under the aegis of the ministry of finance are said to be trying to stop misuse of the 1983 treaty.

The argument being, as to how could only two Mauritian citizens be the directors in most of the 26,000-odd companies registered in the island nation and with investments in India (as per a CBDT report). ET had, however, reported recently that the political classes and most bureaucrats are not in favour of any amendment to the Double Tax Avoidance Agreement (DTAA).

Grey market sees some momentum

The grey market that had been dormant in the recent past is witnessing some momentum. Albeit slowly, several IPOs are being traded once again in the unofficial market. Niraj Cement, which opened for subscription on Monday is trading at a premium of about Rs 15 on a price band of Rs 175-190. The issue gaining in the wake of a well-known bull operator holding some stake in the company. The IPO received bids of about 5.5 lakh shares of the total 32.5 lakh on offer, on day one.

Another IPO, Bafna Pharma, that opens on Tuesday has a grey market premium of Rs 12-15. If market talk is to be believed, this premium is expected to increase as the markets stabilises from these levels. Other than that, IPO like Gokul Refoil, which has closed for subscription is trading at a premium of about Rs 10-12 at a price of Rs 195. Sources maintain that despite withdrawal option offered to investors, Anus Lab is trading at a premium of Rs 30.

ICICI Directs Anil Kaul moves to Future group

ICICI Directs CEO Anil Kaul has resigned and will soon be joining Future Capital Financial Services, a subsidiary of Future Capital Holdings, as joint managing director. According to market buzz, May 31 would be Mr Kauls last day at ICICI Direct and he would be taking up the new assignment in the first week of June.

Future Capital Financial Services is engaged in the business of credit products (like loans against property) and distribution of financial products. Meanwhile, Mr Kaul was unavailable for comment.