The BS Upshot: Recent Episodes
Business Standard
The best of Business Standard's audio news capsules on key sectors of the economy, deep dives into complex issues, interviews, newsmakers, technology trends, and explainers.
The battle between Ahmedabad-based Torrent Group and Hinduja Group to acquire debt-ridden Reliance Capital took another interesting turn this week. The National Company Law Tribunal has now restrained the creditors of Reliance Capital against accepting a higher bid placed by the Hindujas after Torrent said that it was submitted after the completion of e-auction. So exactly what is going on in this high-stake bankruptcy proceeding? And why are Hinduja and Torrent slogging it out? Meanwhile, an altogether different kind of battle is brewing on Indian roads. Several new ride-hailing companies are trying to challenge the dominance of Ola and Uber -- which command over 70% of the market. These newcomers are trying to grab their space with unique offerings. Some let you bid for the lowest price, some are offering eco-friendly electric cars while others are driven by women drivers and only cater to families. The ride-hailing market in India is rapidly diversifying. But is India’s ride sharing market ready for disruption? Pandemic had hit the ride-hailing firms badly. It also made financial market’s movements erratic. Nearly 30% companies let their draft IPO approvals lapse in 2022 due to it. Private markets, too, saw funding winter with tighter liquidity conditions. However, with 2023 expected to be relatively less volatile, will capital raising activity gain steam this year? And will India Inc. tap public or private markets to raise funds? Just about 150-km away from Dalal Street, in the heart of Pune, buses of Karnataka came under attack last month. ATMs of Karnataka banks were also defaced. The decades-old simmering border tension between Maharashtra and Karnataka erupted once again, as assets of Maharashtra too faced similar vandalism in its neighbouring district. So what is this border dispute? And why is the district of Belagavi at the centre of this row? This episode of the podcast all the answers.
If note ban put millions in the bank queues, pandemic forced many more to line up at railway stations and bus terminals. With jobs gone, they had no option but to return home. Struggle to feed their families followed. It was then that the government had launched Pradhan Mantri Garib Kalyan Anna Yojana to provide free food grain. And after about two years, the scheme has now been scrapped. But the government has made PDS free for one year. So what will be its impact? Will it anyway affect the government’s fiscal planning? This podcast has the answer.
Moving on to markets, raw material prices are steadily continuing their downward journey while a firm pick-up in credit cycle has also boosted overall sentiment. Will these positive factors provide succour to India Inc’s fortunes in the third quarter earnings of FY23? This podcast brings you a detailed report.
Inflation played a spoilsport for several sectors last year, and pulled down their stock prices too. Consumers also felt the heat. Those at the bottom of the wealth pyramid were the worst hit. And it is one of the reasons that the government is now mulling shifting to ‘living wage’ from the existing ‘minimum wage’. The living wage is indexed to inflation. And, if implemented, it will give a big respite to those living on the margins. But what exactly is a ‘living wage’? We decode it in this segment of the podcast.
Over six years after the government demonetised 86% of cash in circulation in one go by declaring notes of Rs 500 and 1000 illegal, the Supreme Court on Monday nixed petitions challenging the move and upheld its legality. So what did the apex court actually say in its verdict? And what does it mean? This podcast brings you the answers.
Despite uncertainties, India’s equity market scaled new highs last year. It made investors richer by more than 16.36 lakh crore rupees. But how will the markets and the economy behave in 2023? Will they remain resilient amid familiar challenges? This podcast tells you what leading economists and market analysts think.
It looks like a familiar territory, but with somewhat greener pastures. Is it a mirage or will this year turn out to be better for us? What will be the key developments that need to be tracked in 2023? Listen to this podcast to know more
The government’s ambitious asset monetisation plan was on track last year as it surpassed its target in the fiscal year 2021-22. It reportedly collected Rs 1 trillion against the target of Rs 88,000 crore. But what is the current situation like? Is the plan on track to meet the target in the current fiscal too? Listen to this podcast to know more
The much-awaited decadal census didn’t kick off last year due to the pandemic. And it is unlikely to happen this year too as at least nine states will see elections. But what is a census? Why do we need it? We decoded it in this segment of the podcast,
One of the upsides of lockdowns was that it fueled the growth of several sectors. Fintech was one of them. Of the 100-odd Unicorns in India today, 21 are fintechs. Meanwhile, an SBI report recently said that the use of UPI has jumped 70 times in the last four years. Against this backdrop, a big question emerged this year. Should there be charges on UPI fund transfers? Some in industry believe that it cannot continue forever. Amid all of this, today we ask, did the fintech industry come of age in 2022? And, how will 2023 play out? This podcast brings you the answers.
The next year will also be marked as the International Year of the Millet. India spearheaded the United Nations General Assembly (UNGA) resolution, which was supported by 72 countries and passed in March 2021. A staple grain variety of the past, millets are also reemerging as Nutri-cereals or smart foods today, thanks to their therapeutic qualities and nutritional superiority compared to rice, wheat, and corn. So what will it take to make this “wonder food” become a “wonder crop” of masses in India? This podcast explores the idea.
2022 was a rough year for global equity markets amid rising rates and the Russia-Ukraine war. But Indian markets managed to recover some ground in the second half of the year. Of all the segments, small-cap was the worst-hit. So what led to a dismal performance of small-caps in 2022 and which segments emerged victorious? Deepak Korgaonkar and Puneet Wadhwa bring the answer in this episode.
Banking sector, meanwhile, turned the corner in 2022 and its stocks clocked maximum gains in the last five years. But this year will also be known for the arrest of sector giant Chanda Kochhar -- who was one of the founding members of ICICI Bank. In this podcast, we explain what is the ICICI Bank loan fraud case.
Weather outside the eight-block long Wall Street is also grim as the New York governor has issued another set of warning over extreme cold. The US and Canada are weathering a powerful arctic winter storm. Scores of people have died, thousands of flights have been cancelled and travel bans have been imposed in some parts. News reports are now citing terms like arctic blast and bomb cyclones. We decode it for you in this podcast.
Several Indian states are now rolling out the red carpet to India Inc. for investment. Some of them, like Punjab and West Bengal, need it more than the others. An RBI report recently highlighted the grim fiscal condition of ten states. And of them, five seem to be in dire condition. So what ails these states? And what can be done to revive their economy? Is giving them power to levy income tax an answer? This podcast reaches out to academicians and economists to find the answer.
A host of high-value deals -- including the ones sealed by Adani Group and HDFC Bank -- were the highlights of 2022. It was the year when India Inc. clinched its highest ever mergers and acquisitions, beating the previous record set in 2021 by a considerable margin. So what were the factors that led to this year’s stellar numbers? And, how will 2023 play out? This podcast brings you the answers.
Equity markets were hit by bouts of volatility in 2022 as geopolitical tensions and drying liquidity dented sentiments. This podcast brings you key factors that will shape the markets in the year ahead
The year gone by has proven to be an inflection point for Digital India. From Big Tech to the government, India’s digitisation drive has received, or is poised to receive, a fillip in both innovation and regulation. 5G rolled out a red carpet of promises. And despite crypto’s epic fail, Web 3.0 has emerged as THE watchword in tech innovation, with both start-ups and big techs flocking to the metaverse. How big was the year 2022 then, for tech in India? And what new frontiers can 2023 conquer? This podcast examines the source code.
The Fifa World Cup in Qatar is over, and Messi's Argentina team has taken home the trophy, but the questions about the fate of migrant workers still linger. The World Cup and the attendant media coverage focused on the deplorable conditions migrant workers find themselves in, especially in countries in the Gulf Cooperation Council or GCC. It also begs the question: Why are more and more Indians flocking to GCC countries despite reports of human rights violations? This podcast explores the finer points.
It has been a choppy fortnight for the markets amid a resurgence of Covid-related fears. How do technical chartists see markets play out in 2023? Which sectors and stocks hold promise in the year ahead? Business Standard’s Puneet Wadhwa caught up with Gaurav Ratnaparkhi, head of technical research at Sharekhan by BNP Paribas, on the key levels he is tracking for the frontline indices and the stocks that are a ‘must-have’ in your portfolio.
Last week, we had news from China about the new SARS- CoV-2 variant BF. 7 and how quickly it is spreading in the region. There are few cases reported in India of the new variant leading to a slight surge in the cases of Covid-19. While, experts say there are no serious concerns for India, listen to this podcast to know the new Covid-19 variant BF.7.
The year 2022 was a year of reckoning for Indian startups. They were forced to re-evaluate their business models. For them the winter arrived early, as venture capitalists started tightening their purse strings. New unicorns halved and mass layoffs followed. Now, with 2022 coming to an end, the projections for next year are not very optimistic either. So how did this year change Indian start-ups? And, how have the year’s challenges prepared them for 2023? This podcast brings you the answers.
The horizon for Indian startups may not be that bright. But things are certainly looking up for India’s toy manufacturers. Import of toys has come down by 70% in the last three years while the export is up by 60%. The government is now mulling a production-linked scheme to give a fillip to the sector. So will a PLI scheme help the country’s toy manufacturing sector? This podcast offers an insight
Moving on to financial markets, the recent Sebi order that capped exposure to foreign stocks has hit several schemes hard. PPFAS Mutual Fund’s flagship scheme has an exposure of nearly Rs 28,000 crore to such stocks. How is the fund house dealing with this? How do they see 2023 play out for the equity markets, and what are their top bets? Business Standard’s Puneet Wadhwa caught up with Neil Parikh, CEO of PPFAS Mutual Fund on his views on these issues and a lot more.
India is all set to play the host to next special negotiation round of IPEF in February 2023. Indo-Pacific Economic Framework for Prosperity or IPEF is a trade partnership whose foundations were laid just a few months ago by the US. But why was it formed? And what does it aim to achieve? This podcast explains
When 2022 began, it looked as if India had successfully navigated the immediate challenges posed by Covid-19. But, its economy, which had appeared poised to start the healing process, was hit by another shock -- Russia’s invasion of Ukraine in February. It resulted in soaring commodity prices. However, India weathered that storm too. And as the year comes to a close, the country has emerged as a bright spot in an otherwise dark horizon. But, does that mean that all was well on the economic front in 2022? Were there any challenges that emerged that are yet to be resolved? And, how is the economy likely to perform in 2023? A well-oiled public transport system is key to any country’s economic growth. And, no doubt, the Delhi Metro has contributed a lot to the national capital’s economy, and by extension to that of the whole country. In the last two decades, it changed the transport landscape of the country’s most populous city. Last week, Delhi metro celebrated 20th anniversary. Moving on to the financial markets, global headwinds forced India’s primary market activity to take a backseat with new listings falling by around 50% from 2021. However, on average, IPO returns in 2022 outperformed those of the Sensex index. Against this backdrop, will retail IPO investors remain energetic in 2023? Meanwhile, energy trading platform Indian Energy Exchange, or IEX, recently announced that it was the first carbon-neutral power exchange in the country. To cut down on carbon footprints, IEX used market-based tradable instruments. What does that mean? How does a company become carbon neutral? Let’s find the answers and look at how carbon trade works in this episode of the podcast.
When 2022 began, it looked as if India had successfully navigated the immediate challenges posed by Covid-19. But, its economy, which had appeared poised to start the healing process, was hit by another shock -- Russia’s invasion of Ukraine in February. It resulted in soaring commodity prices. However, India weathered that storm too. And as the year comes to a close, the country has emerged as a bright spot in an otherwise dark horizon. But, does that mean that all was well on the economic front in 2022? Were there any challenges that emerged that are yet to be resolved? And, how is the economy likely to perform in 2023? This podcast brings you the answers.
A well-oiled public transport system is key to any country’s economic growth. And, no doubt, the Delhi Metro has contributed a lot to the national capital’s economy, and by extension to that of the whole country. In the last two decades, it changed the transport landscape of the country’s most populous city. Last week, Delhi metro celebrated 20th anniversary. This podcast traces this transformative journey
Moving on to the financial markets, global headwinds forced India’s primary market activity to take a backseat with new listings falling by around 50% from 2021. However, on average, IPO returns in 2022 outperformed those of the Sensex index. Against this backdrop, will retail IPO investors remain energetic in 2023? Find the answer in this podcast.
energy trading platform Indian Energy Exchange, or IEX, recently announced that it was the first carbon-neutral power exchange in the country. To cut down on carbon footprints, IEX used market-based tradable instruments. What does that mean? How does a company become carbon neutral? Let’s find the answers and look at how carbon trade works in this podcast.
After three years of aggressive buying, foreign portfolio investors slammed brakes in 2022 and withdrew 1.21 trillion rupees from the Indian stock markets. The sellout was more aggressive in the first half. Overall, the market is on course to witness the highest-ever FPI outflows in any calendar year. So, why have FPIs turned negative on India in 2022? This podcast brings you the answer.
Co-working giant WeWork is feeling the heat of impending recession, as the tech industry is tightening the purse strings. Amid all this, the company is striving to gain a good foothold in big Indian cities. To know more about the plans, Business Standard’s Surajeet Das Gupta caught up with Karan Virwani, who is the founder and CEO of WeWork India. Let us listen in this podcast interview.
The recent fall in global fertiliser and natural gas prices are likely to bring respite to fertiliser companies. However, analysts caution that the Russian export duty on fertiliser may have a trickle down impact on the Indian industry. This podcast has more on it
The year 2022 was hard on financial markets across the world. And now, towards the fag end of this year, as the Christmas is approaching, investors are still clinging to some hope. This time from Santa. Markets usually rally on the last five trading days of the year and the first two of the new year. This phase is called the Santa Claus rally. This podcast decodes it for you.
The Sebi board has approved the gradual phasing out of buybacks through the stock exchange route. It has also chalked out governance mechanisms for addressing lapses at market infrastructure institutions, like stock exchanges. So, how will these developments affect shareholders? This podcast brings your the answer.
Business Standard’s BFSI Insight Summit, which returns to in-person mode this year, was kicked off on Wednesday with a keynote fireside chat with the Reserve Bank of India Governor Shaktikanta Das, moderated by consulting editor Tamal Bandhopadhyay. Listen to a few excerpts from the chat.
Turning to the markets now, animal fodder prices have continued to increase this year. It has impacted not just households that depend on cattle rearing but also dairy firms. The high fodder inflation has pushed the input costs for dairy firms. In a bid to bring down these costs, dairy companies have increased product prices several times this year. But the benefits don’t seem to accrue. The big question facing the dairy sector now is: When will these benefits start kicking in?
The interoperability of IoT devices has long been limited to the same brands. But that’s going to change soon. The Connectivity Standard Alliance, in consultation with tech majors like Apple, Google, Samsung and Ikea, has introduced Matter – a common standard for the interoperability of IoT devices. Let’s understand how it’s going to address this pain point
In its meeting on Saturday, the GST Council approved the decriminalisation of certain offenses and clarified the tax provisions on a number of items, including sport utility vehicles. However, the Council ran out of time and about half its agenda, including setting up a GST Appellate Tribunal, was left undiscussed. So, what were the key decisions taken at the meeting and what’s going to be their impact? This podcast brings you the answers.
The men at the helm of affairs in government are apparently unhappy with the long vacations of Indian courts. The justice and law minister of India Kiren Rijiju recently said that the vacation period of Indian courts is an inconvenience to the people. The law minister’s remark on the functioning of the judiciary has opened up a debate if Indians, in general, take plenty of leaves? Listen to this podcast to find out.
Despite firm revenue growth in Q1, Dublin-based Accenture Plc left analysts unimpressed as it pegged the next quarter’s revenue growth below projections. The company also sounded cautious about client spending. So does this signal more trouble for Indian IT companies ahead? This podcast has the details.
The government recently cleared the ‘environmental release’ of a genetically modified variety of mustard. The move has triggered a debate around it. It has been challenged in the Supreme Court too. Environmental activists and several groups representing farmers are bent against GM crops. But exactly are they? And why is so much debate going around them? Let us find out in this podcast.
Reliance Consumer Products — the fast-moving consumer goods arm and a fully owned subsidiary of Reliance Retail Ventures — launched its consumer goods brand, Independence, in Gujarat, on Thursday. The launch puts the company in direct competition with Adani Wilmar, Tata Consumer and ITC, who also have a portfolio of staples and processed food. It is among the latest business verticals that had the Ambanis enter Adani’s turf and vice versa. Is FMCG then the new battlefield between the Ambanis and the Adanis?
Ed-tech startup Byju’s has landed in troubled waters. Creditors of India’s most-valued unicorn are pressuring it to sell off its US assets to repay loans. At the same time, Byju’s harsh working environment has also come to light. This podcast dwells on whether Byju’s is still facing the growing pains of a start-up or is it spiralling downhill.
A surprisingly hawkish pivot by the US Federal Reserve, along with the European Central Bank and Bank of England, crushed global equities towards the end of the previous week. All three banks raised their benchmark interest rates by 50 basis points each, and warned of ‘forceful monetary policy response’ in 2023. Among the lot, Fed announced that it saw the benchmark rate peaking higher than expected at 5.1% next year. It also suggested that inflation may remain stubbornly above its 2% target till the end of 2024; thus ruling out any hopes of rate cuts until then. The spillover effect hit India as well with the benchmark S&P BSE Sensex index cumulatively sinking over 1,300 points during last Thursday’s and Friday’s session. For the week, the Sensex ended 844 points lower at 61,338. The NSE Nifty50, meanwhile, tanked 1.2% to 18,269. In the broader markets, the BSE Mid-cap and Small-cap were down fell up to 1.4%. Going into this week, analysts expect markets to consolidate further and track global cues amid no domestic events. Naveen Kulkarni of Axis Securities, for instance, predicts a limited upside in equities this week on the back of stretched valuation. Kulkarni says, markets corrected after Fed rate hike and impact to be felt for weeks. Valuations not cheap. Inflation sticky at higher level. Expect some more correction Technical charts, too, are flashing warning signs. The frontline indices have dipped below their short-term moving averages with the 30-pack index eyeing over 3,000 points downside if it breaches key support levels. Byte in> [Avdhut Bagkar, Business Standard] That said, any positive newsflow may trigger upmove towards the immediate resistance zones. These are 62,285 for Sensex, and 18,525 for Nifty. Today, market participants will focus on primary market activity. The Rs 1,500-crore IPO of KFin Technologies will open for subscription today, an close on Wednesday. The price band of the offer is fixed as Rs 347 to Rs 366.
Indian nationals in the US applying for the Permanent Resident Card, commonly referred to as the ‘Green Card’, have been facing long waiting periods – often decades long! But now, there is a silver lining on the horizon in the form of the EAGLE Act. What is the EAGLE Act and how can it help? We decode it in this report.
“We don’t know if we are going to be there for the 50th anniversary of the company,” Infosys co-founder Nandan Nilekani said this at an event organised to mark the four decades of IT major on Wednesday. NR Narayana Murthy, who was also at the dais, echoed somewhat similar sentiments as the two founders wondered about the future course of the company -- its leadership, its talent management and the overall structure. So what are the major challenges that the tech major needs to address in the next 10 years? Nandan Nilakni too advised against following the reverse discrimination. Moving on, with 70 games played and two left, the FIFA World Cup 2022, has reached the final lap. While the tournament in Qatar is being hailed for several firsts, it is also drawing criticism. The country’s treatment of migrant workers and corruption allegations are getting as much attention as the ongoing action in the field. So what makes this football world cup so unique? Debarghya Sanyal looks at the scorecards It is not just Qatar. A lot has been happening in India’s media sector too. While ZEE and Sony are set to become a single entity in about six months, Adani Group has forayed in the sector with NDTV acquisition. Meanwhile, the sector, recently, received regulatory fillip from the government. But are these triggers enough to sustain the rally in related stocks? How should investors pick media- related stocks? After the financial markets, let us shift our focus to the country’s security. An attempt by Chinese troops to transgress the Line of Control in Tawang area of Arunachal Pradesh was foiled by Indian soldiers on December 9. But several troops from both sides were injured in the scuffle. Soon a flag meeting was called to bring the situation under control. But what is this meeting all about? And what happens in it? Let's understand in this episode of the podcast.
“We don’t know if we are going to be there for the 50th anniversary of the company,” Infosys co-founder Nandan Nilekani said this at an event organised to mark the four decades of IT major on Wednesday. NR Narayana Murthy, who was also at the dais, echoed somewhat similar sentiments as the two founders wondered about the future course of the company -- its leadership, its talent management and the overall structure. So what are the major challenges that the tech major needs to address in the next 10 years? This podcast brings you the answer.
Nandan Nilakni too advised against following the reverse discrimination. Moving on, with 70 games played and two left, the FIFA World Cup 2022, has reached the final lap. While the tournament in Qatar is being hailed for several firsts, it is also drawing criticism. The country’s treatment of migrant workers and corruption allegations are getting as much attention as the ongoing action in the field. So what makes this football world cup so unique?
While ZEE and Sony are set to become a single entity in about six months, Adani Group has forayed in the sector with NDTV acquisition. Meanwhile, the sector, recently, received regulatory fillip from the government. But are these triggers enough to sustain the rally in related stocks? How should investors pick media- related stocks? Lets find out in this podcast.
After the financial markets, let us shift our focus to the country’s security. An attempt by Chinese troops to transgress the Line of Control in Tawang area of Arunachal Pradesh was foiled by Indian soldiers on December 9. But several troops from both sides were injured in the scuffle. Soon a flag meeting was called to bring the situation under control. But what is this meeting all about? And what happens in it?
The board of One 97 Communications Ltd, the parent of digital payments provider Paytm, has approved a share buyback proposal. The decision comes less than 13 months after Paytm’s disastrous listing. Against this backdrop, how will the buyback affect the company’s fortunes and investors? And, what are the concerns surrounding the decision? This podcast brings you the answers
Retail inflation in India has finally come under the comfort zone of RBI. But the central bank’s relief may be short lived, as global fertilizer prices continue to remain high. So will it affect India’s food inflation in the long run? Tushar Verma answers in this podcast.
As the world is increasingly turning green, scientists in the US on Tuesday announced a big breakthrough. They claimed to have found the key to tame the unruly power of nuclear fusion-- which fuels the sun. But what is a nuclear fusion? How the latest discovery may help us fight climate change? We explain it in this podcast.
The government on Thursday said that adopting new farming technologies, like genetically modified crops, was key to ensure food security for the country, and also to cut the import bill. It also said that extensive studies conducted on genetically modified mustard variant DMH-11 has provided evidence that it is safe for cultivation, food and feed use. So is it time for India to adopt genetically modified crops at a large scale to increase agricultural production? This podcast brings you the answer.
India is set to overtake China as the world’s most populated nation and it needs to ramp up its agriculture production. Adoption of GM crops may help the nation ensure food security for all. Meanwhile, the neighbouring country is also ramping up tests and health infra as Covid is spreading again. What does it mean for India? Should it be a cause for worry for us? This podcast answers the questions.
Recent assembly elections in two states failed to stir any wave in the markets. But it did help AAP qualify for the national party status. So, what is it to be a national party in India? And what are the benefits of becoming one? Also, can a party lose their status as a national party and be demoted? This podcast has all the answers.
Union Budget 2023-24 will be the last full-year Budget ahead of the Lok Sabha elections. The finance minister is expected to lead India on the growth path while keeping the fiscal deficit and inflation in check. The macro-economic concerns will be the subject of much debate and discussion. Meanwhile, there have also been calls from the industry to extend tax benefits to the common man. It’s this, more personal part of the Budget exercise, that Bhaswar Kumar will focus on today and answer how your taxes and investments are likely to be affected.
The expected rationalisation of income tax rates in the Union Budget next year will mean you will have more disposable income to invest and spend. But how safe is your money in bank accounts? In one of the biggest incidents of cyber theft from an individual in the national capital, the director of a security services firm lost half a crore last week. The attack is only the latest in an increasing number of cyber-scams aimed at your bank accounts. How then can you protect your bank accounts from such cybercriminals? Debarghya Sanyal looks for the lock and key
It has been a choppy 2022 for the stock markets amid a host of headwinds. Will the year ahead belong to the Bulls, or will the Bears reign supreme? Business Standard’s Puneet Wadhwa caught up with Abhiram Eleswarapu, CEO and head of India equities at BNP Paribas on how he thinks equity markets will play out in 2023, and his sector preferences in this backdrop
Today the markets will take cues from their global peers. Among stocks, Paytm will be keenly watched as the company’s board is scheduled to meet later today and discuss a buyback proposal. If the board approves the buyback, Paytm will become the 51st company to announce a stock repurchase agreement in 2022. But what is a share buyback, and why does a company undertake it?
5G services were rolled out in some cities last month. Coverage is still patchy, and not everyone has a compatible mobile phone, but 5G technology is still being talked about. One of the key features of this advanced technology that everyone is waiting for is network slicing. Listen to this podcast to find out what network slicing is.
Milk prices may only be moving upwards, but crude oil is behaving differently. Brent crude prices topped the 120 dollars per barrel mark in June and then dropped to a low of 75 dollars in early December as they juggled between recession fears and a price cap on Russian oil. Listen to this podcast, to find out what will guide oil prices in 2023.
While markets may not be too worried about recession or inflation, there is something that you should be concerned about. And that is saving. Or saving to save taxes. Some experts might suggest you invest in fixed-income securities, there are others who may ask you to also look at Equity Linked Savings Schemes to save on taxes. What exactly are Equity Linked Savings Schemes? Listen to this podcast to know.
The December monetary policy of the Reserve Bank of India didn't cheer market bulls on Wednesday. Despite a repo rate increase on expected lines, equity markets edged lower as the governor rang alarm bells over sticky core inflation. Analysts also said the policy left doors open for more rate increases. So, is it time to opt for fixed-income securities instead of equities? Listen to this podcast to get the answer.
It has been a nervous few weeks for the markets as global central banks gear up to battle fears of an economic slowdown and a possible recession. Have the markets fully priced in the possibility of a recession, or it the worst yet to come? Business Standard’s Puneet Wadhwa spoke to Jitendra Gohil, director, global investment management, wealth management, India at Credit Suisse on his assessment of how the markets are likely to play out over the next few months.
The winter session of Parliament begins today, and will end on the 29th of December. The session comes after a leadership change in the Congress and the emergence of a new political alignment in Bihar, where Chief Minister Nitish Kumar has left the BJP-led National Democratic Alliance for the Congress-led United Progressive Alliance. Politics aside, how is the winter session likely to impact the citizens? What does it mean for their data privacy? What’s in store for investors? Bhaswar Kumar brings you the answer in this podcast.
You might need access to a loan for various reasons. A credit card can come in handy for small purchases on credit. And if you are carrying one, it is crucial that you have a good credit score because the easy availability of personal, consumer and other types of loans, along with access to credit cards, is contingent on this. But, what exactly is the concept of credit score? Let’s find out
The IITs are back in news for some delectable packages from potential recruiters this placement season. Besides the core catchment of IT and tech companies, trading firms, data management companies and investment banks have shown an increased interest in the placement events across the major IITs this year. But what does this imply for the new batch of IIT graduates, and for the larger employment trends in the IT-sector? Debarghya Sanyal explores in this podcast.
After a sharp rally over the past couple of months, equity markets are in a bit of a consolidation mood. The next triggers for the markets are the RBI’s policy outcome and the results of Gujarat polls. Both of which will be revealed this week. This podcast takes stock of what all is priced-in by investors, and how different outcomes sway markets.
Indian EV sector may be off to a good start. But, banks have clearly missed the bus. In RBI deputy governor T Rabi Shankar’s words, they failed to scale-up the UPI in early days, and the opportunity was grabbed by the non-banks. Two of them – PhonePe and Google Pay – now rule the space with about 82% market share. And, it seems, their free run will continue as the 30% market cap mandate will not come into force for another two years. So what does it mean for new players like WhatsApp? This podcast answers this question.
Staying on with markets, SEBI had introduced participatory notes in the year 2000 so that the foreign investors too have a slice of India's growing stock markets pie. But in 2007, when it thought of regulating it, the markets crashed like ninepins. The regulator shelved the plan, but not the unease. Meanwhile, foreign investment through this instrument continues to swell. So what is a P-note and what are SEBI’s concerns around it? Listen to this podcast to know more.
Electric vehicles will play a major role in India’s emissions reduction goal. But, the heart of an EV, its battery, is mostly imported. For India to become a major EV player, it will have to master battery making. Given the capital intensive nature of the sector, Indian firms will have to grab a share of the global battery demand pie to turn a profit. So, can Indian industry succeed in this ambitious venture? This podcast has the answer.
Experts are also calling for a comprehensive review of cybersecurity guidelines. Moving on, equity markets have started the last month of 2022 at record high levels as renewed buying by FIIs, and hopes of moderation in rate hikes boosted sentiment. With the US Fed chief striking a dovish tone last week, all eyes are on the RBI this week. This podcast delves into what the markets expect from the central bank, and what other key factors will guide the trading week.
Let us see how India is trying to find ways to meet its rising electricity demand. The government recently said that it is exploring building small modular reactors. But what are they? This podcast explains.
Cars and high-end phones are selling like hot cakes. But the demand for motorcycles and entry-level mobile phones is on decline. While big screen TVs and luxury apparel flew off the shelves in cities, rural demand for FMCG products saw a negligible jump in October -- a month which brings good fortune. So, what do the divergent fortunes of these industries say about consumption in India and its economy? This podcast brings you the answer.
As India Inc recovers from the scars of pandemic, there is another big threat which refuses to go away. Government institutions too are vulnerable to it. Last month, a cyberattack brought the services at AIIMS, Delhi to a standstill. So why is India vulnerable to such attacks? And what can be done to tackle this threat? This podcast has the answer.
After two years of subdued festivities, markets once again teemed with keen shoppers last October. Diwali was celebrated with usual pre-pandemic fervour. And sales figures, which are coming out now, clearly attest to it -- like auto sales jumped by 48%. The prime festival month saw 18.3% growth in total non-food credit offtake. Retail loans -- driven by robust housing and vehicle loans demand -- saw an impressive 20% jump. So what explains this surge in personal loans? We crunch the numbers for you in this podcast.
Domestic air traffic also rose by 10% in October, as 11.4 million people thronged airports across the country. Meanwhile, the entry of the mighty Tata Group is making waves in the aviation sector, which is staring at consolidation now. India’s second largest airline, Vistara, will soon fly into history. It is being merged with Tata-owned Air India. But, apart from the opportunities, what challenges will this merger pose given the distinct work cultures of the two airlines? Will it be a smooth ride for Air India? Three experts share their thoughts in this podcast.
After going through the roof, the price of jet fuel is coming down now -- giving breather to airlines. But it is not easy sailing for the common man. Price of natural gas is still breaking the back. A government-appointed panel of Kirit Parikh has given a set of recommendations to reform the natural gas pricing regime. It wants to do away with the existing norms where prices are fixed in tandem with global markets. It may give some succour to us, but how will these reforms affect companies in the sector. We find out in this podcast
Here's a piece of good news: Researchers in China’s Yunnan University have finally achieved a breakthrough in developing a rice variety, which does not need to be planted every year. Once grown, it can be harvested for next eight seasons in four years. This podcast has more on it
India’s digital rupee is making its retail debut today. Soon, people like you and me will be able to use this digital currency for daily transactions. Now, if you already use digital wallets and UPI, you may ask, how will e-rupee be any different? This podcast answers this question
Meanwhile, in another milestone for India, the third version of semi-high speed Vande Bharat train chugged off from the stable of Integral Coach Factory recently. The government is now keen on starting its export too. And it also plans to roll-out over 300 more of these trains in near future. But one of the main brains behind this sophisticated train, Sudhanshu Mani, is a reclusive man. We caught up with him to learn more about his journey
Let us move on to markets now. The rally in public sector banks, after their impressive September quarter performance, may soon fizzle out. While the outlook for the sector remains optimistic, analysts say the Street has priced in all the positives. With over 70% rally in the Nifty PSU Bank index, in just 5 months, should investors turn to their private peers for better returns? Let us find out in this podcast
When asked about the logic behind NDTV’s takeover, Gautam Adani is reported to have said that he wants to build a global news brand. Asia’s richest man is also planning to roll out a super app soon. He is also raising over 2.5 billion dollars through an FPO to fund his green and digital ambitions. A cursory look at announcements made by Adani in the last 15 days clearly points towards one trend -- that he is trying to significantly expand his conglomerate. But why is Adani pursuing such a strategy, especially when large, diversified conglomerates continue to be seen as dinosaurs in the West?
From high valuations to moderation in growth, analysts say risks are emerging for Indian equities, and investors need to be careful in their approach. But are the risks too strong for India? Will our markets be able to tide over this uncertain short-term phase? Listen to this podcast to know more.
Meanwhile, a threat much bigger than the one being faced by the financial markets is uniting the world. And diving too. Every year, leaders from over 200 nations come under the roof. For over a fortnight, they share ideas and indulge in heated debates to find a solution to one big threat: the rising temperature of our globe. And most discussions boil down to one thing. How much the developed nations will contribute towards the climate fund. But what exactly is this fund? And how does it help in fighting climate change? Find answers to these questions in this segment of the podcast.
From high valuations to moderation in growth, analysts say risks are emerging for Indian equities, and investors need to be careful in their approach. But are the risks too strong for India? Will our markets be able to tide over this uncertain short-term phase? Listen to this podcast to know more.
In the run-up to the upcoming Union Budget, finance ministers of some states -- mostly ruled by opposition parties -- have demanded a 10 percentage point jump in their share of revenue from GST collections. From the current 50%, they want it to be increased to 60%. So what is behind this demand? And what will be its impact if implemented? This segment of the podcast answers this question
India’s robust GST collections clearly point towards one thing. That its economy is growing at a good pace. Global companies too are increasingly seeing India as an attractive investment destination. A series of developments in China over the last three decades, including the gradual increase in labour costs, have prompted companies to look for alternative destinations. And the recent lockdowns and protests are giving fresh impetus to China-Plus-One policy. So will India be able to reap the benefits of its demographic dividend? And, will it score over its Southeast Asian rivals? This podcast presents a picture
Foreign portfolio investors returned to Dalal Street after over two months, pumping over 31,000 crore rupees into domestic stocks till November 25th. Domestic investors have also moved past inflation and rate-hike worries, which is enabling benchmark Sensex and Nifty indices to continue to scale fresh highs. This bullish momentum has spread to the broader markets, too. But, will it sustain? We find out in this segment of the podcast
Bisleri, India’s biggest and most popular packaged water brand, is up for sale. 82 years old Ramesh Chauhan -- who built this brand -- is scouting for a new owner who can take forward his legacy. And the news has stirred a wave in the FMCG sector. Several big players are said to be in talks with the veteran industrialist. Tata group is also one among them. But what will the salt-to-software conglomerate gain by adding Bisleri bottles to its water crate? An altogether different kind of race is, meanwhile, going on in space. India too is trying to land a spot there. After government-controlled ISRO, the country’s private sector too has made a move. India’s first privately-developed rocket, Vikram-S, blasted off towards the sky earlier this month. Some called it India’s SpaceX moment. But will it be? Bhaswar Kumar tells how India’s commercial space industry may well become a technology power house and taste commercial success Let us move on to markets now. After more than a year, the benchmark S&P BSE Sensex index logged its fresh lifetime high last week. The index has rallied over 20% from its 52-week low led by metals, financials, and FMCG shares. The NSE Nifty50, meanwhile, is hovering near 1-year highs. Do these sectors have enough legs to take the indices further higher or is it time for sector rotation? The stock of Bharti Airtel hit a 52-week high early this week on the back of 5G rollout, the tariff hike in two states and an impressive 89% jump in its net profit. Its average revenue per user, or ARPU, also shot up to ₹190. Telecom companies, media platforms and firms in several other sectors often cite ARPU numbers to flaunt their performance. We decode it for you in this segment of the podcast.
Bisleri, India’s biggest and most popular packaged water brand, is up for sale. 82 years old Ramesh Chauhan -- who built this brand -- is scouting for a new owner who can take forward his legacy. And the news has stirred a wave in the FMCG sector. Several big players are said to be in talks with the veteran industrialist. Tata group is also one among them. But what will the salt-to-software conglomerate gain by adding Bisleri bottles to its water crate? This podcast answers
During the first half of this fiscal, foreign direct investment equity inflows fell by 14%. While the total FDI -- which includes equity inflows -- also saw a contraction of 9%. So what led to this fall and what could be its impact on the Indian economy? This podcast break it down for you
There has been an uptick in FDI in the Indian automobile sector over the years. It is expected to become the world’s third largest by 2026. Back home, people are thronging the showrooms to drive home new cars. The sales of passenger vehicles shot up 29% last month. Meanwhile, a parallel industry of second-hand cars is also thriving. And it is becoming increasingly organised. The market for second-hand cars is expected to double in the next five years. Is the used car then the new “new” for Indian auto-buyers? This podcast tries to drive home the logic behind having a pre-owned car
Easing chip shortage also helped auto sales touch the 1 million-mark in Q2. However, as demand entered a slow lane amid weak exports in October, and the end of the festive season, the rally in auto shares lost its steam. Will this trend continue? Let’s find out in this podcast
Speaking at the Bengaluru Tech Summit, Minister of State for Electronics and IT Rajeev Chandrasekhar last week said that the next generation of devices and products, like India Stack, are being architected and designed in India. But ever wondered what exactly is India Stack? In our next report, we offer an insight into this platform and how will it help India achieve its ambitious digital transformation
The Australian Parliament on Tuesday gave its assent to a free trade agreement with India, and simultaneously amended the Double Taxation Avoidance Agreement. The pact will double trade between the two nations. While the amendments to the double taxation treaty will help Indian IT firms save millions of dollars every year. This podcast explains what India’s first free trade deal with a major Western economy means and how it will benefit the country’s foreign trade?
In another big development, India on Monday came out with a framework to address the menace of fake online reviews on e-commerce websites. Now websites like Amazon and Flipkart and food delivery apps like Zomato and Swiggy will have to make sure that the reviews on their platform are not fake or misleading. This podcast offers an insight into this initiative which is being touted as the world’s first
In a first, India released its long-term low-carbon emission development strategy at the recently-concluded United Nations Climate Conference. As the focus on green energy takes centre stage, is it time to add stocks from this space to your portfolio? Listen to our markets report to find out
From the financial markets, let us shift our focus to politics. States governed by opposition parties are constantly in the news for their brushes with governors. In Kerala, the state government is planning a bill to remove governor Arif Mohammed Khan as the Chancellor of state-run universities. Kerala’s LDF government has been alleging that the governor is a political appointee. But what does the Constitution say about the governor? And what is his role? This podcast breaks it down for you
Volatility swept domestic markets last week, marred by declining global sentiments, after the US Federal Reserve Chairman Jerome Powell propelled rate hike concerns on reiteration of hawkish stance. Yet, strong foreign inflows helped frontline indices end flat. The benchmark index Nifty50, for instance, dipped a meagre 0.1% last week, while the BSE Sensex fell 0.05%. While analysts attribute the Indian markets’ resilience to healthy foreign inflows, they fear the peak of FII buying may be over. According to VK Vijaykumar of Geojit Financial Services, “FIIs are increasing their short positions in derivatives amid a surging dollar index, that hit a 20-year high of 109.6 last Thursday. This, and the US 10-year bond yield racing to 3.26%, is unfavorable for emerging market equities.” Analysts at Credit Suisse, too, have downgraded equities to ‘underweight’ on the back of rising inflation and recession fears. Going forward, analysts see markets to remain range-bound in the near-term. Neeraj Chadawar, Head - Quantitative Equity Research, Axis Securities says RBI’s rate hike trajectory to guide markets. Watch out bond yield cues, commodity prices. Markets to remain range-bound in near-term. Apart from FII buying, falling crude oil prices also supported Indian equities last week. Brent crude prices have retreated below the 100 dollars per barrel-mark, and may be heading towards 80 dollars per barrel level, hopes Mohammed Imran of Sharekhan. He says, “We expect prices to fall further under $80 in coming weeks. Though a resilient labour market in the US may push crude to test resistance of $92, we remain bearish on crude oil outlook in near term.” Against this backdrop, technical charts suggests that the 50-pack index can move towards 17,850 levels this week with a support of 17,350 on the downside. The S&P BSE Sensex, meanwhile, can steer towards 59,800 on the upside with 58,000 acting as a strong support. Fundamentally, the European Central Bank’s interest rate decision, rupee movement, and crude oil prices will guide markets during the week.
Understanding currency swaps In its bid to help the developing countries, the Indian government may soon allow currency swaps backed by mineral resources. A currency swap is an agreement between two cross-border entities where one of them agrees to provide a loan to another in a foreign currency. The repayment takes place in a different currency at a fixed date and an exchange rate. The interest rate charged on such loans is usually lesser than that available in the foreign market. Let us understand it with an example. Suppose India signs a currency swap agreement worth $5 million with say, Nepal. India will then provide a loan to Nepal in a foreign currency which may be US Dollar. In return, Nepal will have to return the money in Indian Rupees at a fixed interest rate. This comes as a saviour for the countries going through a foreign reserve crisis as it allows them to get a loan in USD, at a lower rate of interest. Sri Lanka crisis and India’s lending hand Sri Lanka has been going through severe economic and political turmoil for the last several months now. High inflation and depletion of foreign reserves to an unsustainable level led the country to utter chaos. To help the neighbour, India signed a currency swap agreement of $400 million with Sri Lanka. And in April, extended its term for repayment after the country said that it cannot meet its debt obligations. Since 2018, India has agreed to sign currency swaps with 23 countries. Why do countries opt for currency swaps? These swaps allow the countries to get a loan at a lower rate of interest than the foreign markets. Also, it helps the recipient country to maintain their foreign reserves even as other foreign debt obligations loom large. How are exchange rates determined? The exchange rates of currencies keep changing every day. This may lead to inconvenience at the time of repayment. For this, the exchange rate is usually fixed in advance during the signing of the agreement. So, the repayment amount remains largely the same. With the government mulling over backing the currency swaps with trade, we may see India extending more such agreements to developing countries.
When Warren Buffet’s Berkshire Hathaway invested $232 million into China’s BYD, it was a nascent startup that had just started selling electric vehicles. Fourteen years on, Berkshire’s stake is worth $7.5 billion dollars and BYD has dethroned Tesla as the world’s biggest EV maker by sales. Between April and June, BYD shipped 3.54 lakh EV units, an increase of 266% year-on-year, while Tesla’s global sales grew 27% to over 2.54 lakh units. It also overtook South Korea’s LG Energy as the world’s second-biggest EV battery manufacturer, behind China’s CATL. The Shenzen-based group is now aggressively pushing into foreign markets, including India where it is set to unveil its first e-SUV soon, with deliveries beginning in January. The company has been selling its electric MPV e6 to corporate and fleet customers in India since November 2021. Its upcoming model, the Atto3, will also be assembled at BYD’s plant near Chennai which has an installed capacity of 10,000 units per annum. Tigor and Nexon EV maker Tata Motors held a whopping 85% share of the passenger EV market in FY22. They were followed by China’s SAIC-owned British brand MG Motors at 11.5% with its ZS EV. According to the Federation of Automobile Dealers Association, out of the 2.72 million passenger vehicles retailed in India in FY22, EVs constituted just 17,802 units or 0.65%. However, this represents a 257% jump over FY21. Sanjay Gopalakrishnan, Senior VP, Electric Passenger Vehicle Business, BYD India says we have our own technologies that give us an edge. BYD India will initially sell top-of-the-line premium EVs. By 2030, we are aiming at a 40% e-PV market share. India is among a handful of countries that support the global EV30@30 campaign, which aims to have at least 30% of new vehicle sales be electric by 2030. BYD’s entry is a sign of the growing interest of global carmakers to gain a foothold in India’s EV market. After launching Kona EV in 2019 to test the market, Hyundai India is getting ready to launch its first electric crossover, Ioniq 5, this year. The South Korean firm has also started developing a small electric car for India as part of its plan to launch six EVs in India by 2028. Hyundai’s sister company Kia launched its first electric car in India, the premium crossover EV6, recently. Sweden’s Volvo debuted its electric compact SUV XC40 Recharge in India in July. Tata’s electric SUV Curvv will hit the market within the next two years while MG Motor will launch an affordable mass-market EV next year. Volkswagen is also looking to sell its first electric car, the ID.4 SUV, in India in limited quantities next year. Mahindra & Mahindra will launch five electric SUVs for both domestic and international markets starting in 2024. Tata Motors plans to launch the Avinya, its pure electric car, in 2025. Luxury car firms are not holding back either. Mercedes-Benz will become the first company to assemble a luxury EV in India as it launches three electric cars this year. Audi India’s launched its maiden EV offering e-tron last year. In a span of six months, BMW launched three electric models in India - the iX SUV, MINI hatchback and i4 sedan. Porsche has brought its all-electric Taycan and Jaguar its I-PACE. American EV startup Fisker is aiming to launch two EVs in India. Experts say the pace of electrification in the luxury segment is expected to be much faster than the mass car segment Sanjay Gopalakrishnan of BYD India says 45,000 to 50,000 EV cars could be sold in India this year. Only the initial 1.5% to 2% EV adoption takes times. EV adoption will pick up when resale market emerges. At the current pace, EVs could make up as much as 1.4% of total domestic passenger vehicle sales this year signalling an increase in adoption. With more than a dozen OEMs vying for India’s EV passenger vehicle market, first movers like Tata Motors and MG Motors are set to face some serious co
A considerable jump in air traffic and moderation in jet fuel prices have failed to turn around the fortunes of SpiceJet -- which continued to remain in the red. In January, domestic airlines carried 64 lakh passengers. And the numbers jumped to 6.7 crore in July. During the same period, SpiceJet’s domestic market share came down from 10.65 to 8%, which meant the airline slipped from Number 2 to Number 5 in ranking in a matter of six months. The company delayed its Q4 FY22 results after witnessing a ransomware attack on May 25th. SpiceJet on Wednesday reported a Q4 loss of 458 crore rupees and a loss of 789 crore rupees in the April-June period, the first quarter of FY23, due to high fuel prices and a depreciating rupee. First-quarter total revenue more than doubled to 2,478 crore rupees. The overall loss incurred in FY22 was 1,725 crore rupees, a jump of 73% over FY21. To make matters worse, its Chief Financial Officer Sanjeev Taneja, who took charge in November 2020, resigned with immediate effect on Wednesday. SpiceJet said a replacement has been found.. Markets took the cue. The Gurugram-based airline’s shares fell as much as 15% on Thursday. So far this year, the stock is down 33%. The cash-strapped airline has been struggling to make timely payments to vendors and lessors, which has led to the aviation regulator DGCA deregistering six Boeing 737 aircraft in August. Its employees on Wednesday alleged a delay in the disbursal of salaries for the second straight month, with the airline saying the payments were being made in a “graded format”. In July, DGCA ordered SpiceJet to slash its approved fleet to 50% this summer for eight weeks in the wake of several mid-air safety snags. The regulator said that it would subject the airline to “enhanced surveillance”. In a show-cause notice, DGCA has said the airline failed to build “safe, efficient and reliable” air services. As of March 31st, SpiceJet had a negative net worth of 4,288 crore rupees and negative retained earnings -- or accumulated losses -- of 5,913 crore rupees. Its current liabilities exceeded its current assets by 6,408 crore rupees. Its cash and cash equivalents at the end of FY22 stood at 9.6 crore rupees while bank balances were 50.7 crore rupees. Managing Director Ajay Singh said despite “the complex operating environment and highest ever input costs”, the airline had been able to sustain its operations and would soon engage investment banks to raise up to $200 million or about 1,590 crore rupees. [Rohit Tomar, Managing Partner, Caladrius Aero Consulting] In short, Ajay Singh needs a white knight. Given SpiceJet’s current market capitalisation of 2,700 crore rupees, any fundraising can cause significant dilutions for existing shareholders, including Singh who holds a 59% stake. But this can be avoided by structuring the infusion such that he retains control after onboarding the financial investors. Unless he can convince new investors that he is the right man again to steer the turnaround, he may not come out unscathed.
The jaw-dropping success of movies such as KGF Chapter 2 and RRR had lifted spirits of multiplex owners, who were looking to shake off the pandemic blues after two long years. However, latest regional movies including Liger have failed to cheer the Box Office. Besides, Bollywood movies such as Laal Singh Chaddha, Shamshera and Dobaaraa, too, have faced public backlash. All of this, analysts say, will lead to a bumpy road for listed players like PVR and Inox Leisure. Deepak Jasani, Head of Retail Research, HDFC Securities says only handful of regional movies do well nationwide. Revenue from South Indian movies unlikely to fill the gap. Multiplexes need good show from Bollywood movies. Pinning hopes on regional movies is too optimistic. Shares of PVR and Inox Leisure have slumped around 14% each over the past one month as revenue from Bollywood movies account for 40-45% each for both these players. In comparison, the BSE Sensex was unchanged during the period. Financially… ...PVR reported highest-ever revenue and net profit of Rs 1,000.4 crore, and Rs 68.3 crore, respectively, in the June quarter of FY23.Inox, meanwhile, reported record revenue of Rs 589 crore, and profit of Rs 74 crore. However, this was largely driven by higher food and beverages revenue, lower employee costs and higher other income. Further, Net Box Office Collection, as a percentage of revenue, improved only 2 percentage points for both, PVR and Inox Leisure. Moreover, Inox Leisure clocked a mere 6% increase in footfalls above the pre-pandemic levels, while PVR is yet to recover the lost ground. G CHOKKALINGAM, FOUNDER AND CHIEF INVESTMENT OFFICER, EQUINOMICS RESEARCH says, movie goers are switching to OTT. Low budget movies are being released directly on OTT platforms. Big ticket movies make their way to streaming apps after two-three weeks of Box Office run. OTT will eat into multiplexes’ revenues in the long-run. Against this backdrop, analysts see another 10-15% correction in stock prices. They also expect weak earnings to put pressure on price-to-earnings valuation multiples. On Friday, stock-specific action and auto sales data will guide investors. Globally, market participants will await the US jobs data.
the world order shifting towards multiple currency systems? The murmurs of finding an alternative mode of payment recently grew louder after western nations, led by the US, slapped a host of sanctions on Russia for attacking Ukraine. Iran too had been trying to find an alternative to the US dollar – the world’s reserve currency – to circumvent the sanctions imposed on it for its nuclear programme. Back home in India, the takers for UPI are growing. France, UAE, Singapore, Nepal and Bhutan are on-board UPI now. And it is fueling India’s ambition to put Rupee on the world map by making it a reserve currency. But what is a reserve currency? What is a reserve currency? A reserve currency is typically a globally-recognized foreign currency that central banks or other financial institutions hold in large quantities as part of their country’s foreign exchange reserves. It is utilised for global transactions involving trade and investments. At present, the US dollar is the world’s predominant reserve currency. A reserve currency is also used by central banks to prepare for international debt obligations and to influence their domestic exchange rate. A large proportion of commodities, from gold to oil, are priced in the reserve currency. Thus, other countries have to hold this currency to pay for these commodities. There is one more reason for holding a reserve currency. Doing so minimizes exchange rate risk since the purchasing country will not need to exchange its currency for the reserve currency while making purchases. Besides import payments and servicing foreign debt, countries also maintain such reserves to overcome economic crises. Let us say a country sees its currency value fall during a recession, then its central bank can use its foreign reserves to maintain the currency value. Key features of reserve currency A reserve currency’s main feature is that it must be easily convertible and have a stable value. The factors that determine the usage of a country's currency as a reserve currency are the size and heft of its economy, particularly the importance of the economy in global trade, the openness and depth of the concerned country's financial markets, and its macroeconomic policies. Since 1944, the US dollar has been the world’s primary reserve currency, which is why other countries closely monitor US monetary policy to make sure that the value of their reserves does not face any negative impact due to inflation or rising prices. Over the years, the IMF has selected other reserve currencies, which are the Euro, Chinese Renminbi, Japanese Yen, Pounds Sterling, Australian Dollars, Canadian Dollars, and Swiss Francs. There has been speculation that the Chinese Renminbi will displace the US dollar as the world’s reserve currency in the coming years. It is also believed that the dollar will have to share its influence with other currencies going forward. As far as the rupee is concerned, meeting the ambition of becoming a reserve currency requires full capital account convertibility, as suggested by the Tarapore Committee in 1997.
India’s Gross Domestic Product grew 13.5% in the first quarter of FY22-23 compared to a year ago helped by the base effect, thereby registering the fastest growth in four quarters. But the numbers came in below the 15.2% forecast by economists, and much lower than the Monetary Policy Committee’s projection of 16.2%. The last time India’s economy grew faster was in Q1 FY21, when it gained 20.1% from the pandemic-depressed level a year earlier. With rising interest rates, uneven monsoon and slowing global demand, analysts fear the economy may fall short of the 7.2 per cent annual growth target for FY23 projected by the Reserve Bank of India. The GDP during April-June 2022 stood at Rs 36.85 trillion, compared to Rs 35.49 lakh crore in the corresponding quarter of the pre-pandemic year 2019-20. This means, the country’s economy has grown at an average of 1.26% a year in real terms over the past three years. On a sequential basis, GDP in the first quarter contracted 9.6% from the preceding three-month period. According to Sachchidanand Shukla, Group Chief Economist at Mahindra and Mahindra, this is three times the average sequential contraction of 3.2% witnessed in the first quarter of each of the last five years before the pandemic. But, the year-over-year growth in GDP was led by consumption and investments, which grew 25.9% and 20.1%, respectively. The growth in government expenditure was a weak 1.3%. Looking at the sectoral trends, the GVA growth in manufacturing was 6.5, while the construction sector grew 16.8%. The labour-intensive trade, hotels and transport segment showed a strong 25.7% growth. The data released by the National Statistical Office showed while the services sector lifted growth during the quarter, activity in the trade, hotels, and transport segment, despite heightened betterment in hospitality, was below the pre-pandemic level of the June quarter of FY20. Aditi Nayar, Chief Economist at ICRA however said that relative to the pre-Covid level, this stood out as the only sub-sector reporting a contraction in Q1, in line with the robust but incomplete recovery in contact-intensive sectors. Madan Sabnavis, Chief Economist, Bank of Baroda says, coming off a low base, one shouldn’t reach much in the 13.5% number. Agri, real estate, finance and govt sectors contributed to the growth. Pvt investment and consumption should sustain for 7.2% annual growth. Pent-up demand could get diluted due to high inflation. Inflation remains one of the biggest risks as it impacts consumer spending, which accounts for about 60% of India’s nominal GDP. There is also a possibility of slippages in terms of rice and pulses production if the area under cultivation is lower than normal. This can result in further price shocks if sowing doesn’t see a recovery. On the fiscal side, buoyancy in tax collection will give enough comfort to the government in terms of budget management. Aurodeep Nandi, India economist and vice president at Nomura said even if one were to discount the low base, this marks a stellar rise in sequential momentum with post pandemic tailwinds lifting GDP growth in June quarter. As the year progresses, experts say that that slowing global growth, higher inflation, and tightening financial conditions will impact the pace of growth.
Reliance Capital’s resolution has received tepid response as only four firms have made financial bids for the entire company, including its subsidiaries, under the insolvency process. IndusInd, Torrent, Oaktree Capital Management, and B-Right Realestate have submitted bids in the range of just Rs 4,000 crore. When the resolution process began, over 50 firms had submitted Expression of Interest for various assets, but only a handful of bidders were engaged. The bids have to be approved by a lender's committee. Lukewarm response for RCap asset: 1) IndusInd, Torrent, Oaktree Capital Management, and B-Right Realestate placed bids 2) All bids were placed in the range of Rs 4,000 crore. The process for asset sale of debt-ridden Anil Ambani’s Reliance Capital had kick-started in November last year, when the Reserve Bank of India (RBI) superseded its board for payment defaults and initiated bankruptcy proceedings. Y Nageshwara Rao was appointed administrator for the corporate insolvency resolution process. After Srei Group’s shadow banking arm and DHFL, Reliance Capital is the third NBFC to go under insolvency under IBC. Reliance Capital has a consolidated debt of about Rs 50,000 crore. But to expedite the sale process, the lenders hived off two entities of RCap --- Reliance Commercial Finance and Reliance Home Finance --- into a trust for a separate resolution process. It was done so that the bidders don’t deal with debt of these two entities, which is around Rs 25,000 crore. Secured creditors have claimed Rs 22,122 crore and unsecured creditors around Rs 3,212 crore after the company was sent to insolvency. Major lenders include Life Insurance Corporation, YES Bank among others. Reliance Capital’s lenders had offered two options to all the bidders. Under the first option, companies had to bid for Reliance Capital as a whole, including its subsidiary companies. Under the option-2, bidders have the freedom to bid separately for individual arms of Reliance Capital. Due to a tepid response from the bidders, the lenders earlier had to extend the timeline for submission of bids and the resolution process several times. The deadline for completion of the corporate insolvency resolution process of the company is November 1, 2022. Reliance Capital’s eight businesses were on the block for bidding including general insurance, securities and asset reconstruction businesses. Under the second option, Reliance Capital’s general insurance received bids from Piramal Group, Zurich Insurance Group, and Advent International. While, the company’s ARC business got bids from Jindal Steel & Power and UV Asset Reconstruction Company, Choice Equity, Global Fincap, and Grand Bhawan have placed bids for other assets of Reliance Capital. Please include the byte: Ashvin Parekh, Managing Director, Ashvin Parekh Advisory Services LLP says, the bids for Reliance Capital assets were on the lower side. Lenders have few options left before approving the bids. But the poor response indicates that lenders are in for massive haircuts. It also showcases bidders’ concerns, especially over equity of Reliance General Insurance, held by IDBI Trusteeship on the behalf of Credit Suisse. IDBI Trusteeship has refused to release these shares for the ongoing NCLT led resolution process. The condition to make all-cash bids also proved a hindrance in the resolution process Mukesh Chand, Senior Counsel, Economic Laws Practice says the committee of creditors will likely negotiate with proposed bidders. CoC will try and work out a best possible resolution plan with the bidders. If viable options don't come out in negotiation process, big haircut is on the cards. As the bids are placed, the ball is in the lender’s court now. They have to take a call on the value of bids and evaluate other options, including negotiating a better deal with the proposed bidders. Whatever may be the case, it is in the creditors’ best interest to comple
Equity markets have been extremely volatile so far in 2022. Investors have found themselves torn between conflicting domestic and global economic outlook. This mood has cast a spell on primary markets as well. In the last 8 months, only 16 companies have tapped the primary markets via IPO route, raising around 40,300 crore rupees. In comparison, data from PRIME Database suggests that 63 companies had raised a cumulative Rs 1.18 trillion via the IPO route in 2021. Recently, online pharmacy PharmEasy withdrew its draft red herring prospectus filed with market regulator Sebi. It cited volatile market conditions and ‘strategic considerations’ as the reason for this withdrawal. Besides, Dreamfolks Services, India’s largest airport service aggregator, too, had scaled back its issue size by 20% citing volatile market conditions. According to Dara Kalyaniwala of Prabhudas Lilladher Capital Market, “The volatility in the secondary markets impacts issuer Company’s confidence, not only about the IPO sailing through, but also about the post listing response.” That said, a meaningful revival of the primary markets, though some time away, may be driven by stable secondary market conditions amid better Q2FY23 results. Investors will keenly watch inflation trajectory and actions of global central banks over the next few weeks. On Thursday, the markets will reopen after a day’s holiday on account of Ganesh Chaturthi, and will track global cues besides reacting to GDP data for the first quarter of the current fiscal.
What is Floor Area Ratio? The Floor Area Ratio (FAR) indicates a relationship between the size of the plot area and the built up area on that parcel of land. Built up area is the total area covered by internal and external walls and includes the ducts and interior part. How is the Floor Area Ratio determined? To determine a floor area ratio, several factors like population density, the land size, location and environmental impact are considered. Floor area ratio varies depending on the use of the land, whether it is for residential, commercial or for industrial use. The ratio directly affects the height of the building. The higher the FAR, the construction of a building is allowed to be that much taller. So, higher floor area ratios are typically found in dense urban areas. Why is Floor Area Ratio important? FAR helps in dividing land parcels into zones, thereby restricting dense building constructions. It also impacts home buyers. A higher floor area ratio will mean that there could be taller buildings and the amenities such as gardens, parking spaces and water supply will have to be shared with a large number of people. A higher floor area ratio allows developers to construct high-rise buildings, leading to increased sales and more marketable space. The higher FAR also allows developers to construct more units on a land parcel. This is why the realty players seek a rise in floor area ratios so as to open up more space and land resources. Violations in FAR rules can invite action. Like what happened in Noida’s Supertech twin towers case. They were demolished last Sunday for violation of norms. The floor area ratio was changed several times. The Supreme Court noted that there was “nefarious complicity" between the Noida authority and the builder. In its original plan and the brochures, and also in the completion plan, the area where the two towers were built was shown as a garden. That’s all for today. For more news and analysis, please login to Business Standard.com
Amid the ongoing push to introduce electric vehicles on Indian roads, one important factor seems to have taken a backseat. The fact that electric vehicles are way more expensive than the traditional combustion engine vehicles. Maruti Suzuki Chairman R C Bhargava has now appealed to the government to incentivise alternative technology such as hybrid, CNG, biogas, and ethanol for small and affordable cars. He has made a strong pitch to the government with the belief that a sizeable proportion of Indian consumers need an alternative to the costly electric vehicles. So, as India tries to meet ambitious clean-mobility goals, are low-cost hybrids the solution that the Indian car market needs? While India is still testing the waters, in neighbouring China, the electric vehicle market is booming. China is the largest EV market in the world, accounting for 53 percent of global sales last year. But, its real estate bubble is finally bursting. People are hitting the roads in protests while the government is trying hard to douse the flames -- using a mixture of crackdown and incentives. Here's an insight into the brewing crisis in China. China is ramping up financing support for its troubled real estate sector, and another bailout may also be on the cards. Meanwhile, back home, a slew of big announcements may be on the cards as Mukesh Ambani-controlled Reliance Industries is set to hold its 45th annual general meeting on Monday. The company may announce its plans for 5G rollout, green hydrogen, solar power, and the retail business. Our next report takes a stock Markets, meanwhile, nosedived on Thursday ahead of US Federal Reserve’s Jackson Hole conference. Let us move on to a law which was in the news recently. The Supreme Court on Tuesday struck down a provision of the Benami Transactions (Prohibition) Act 1988 as unconstitutional. It entailed punishment for any ‘Benami’ transaction. This episode of the podcast tells more about the ‘Benami’ law
Maruti Suzuki Chairman RC Bhargava believes that if a company wants to succeed, it must keep an ear to the ground and know what the consumer wants. 88-year-old Bhargava -- who at the helm of Maruti Suzuki helped make cars affordable for millions of middle class Indians -- has now appealed to the government to incentivise alternative technology for small cars. And, he is dead set against blindly replicating the western model. But, why focus on small cars? After all, the market share of cars priced below 5 lakh rupees has shrunk from 25.8 per cent in FY19 to just 10.3 per cent in FY22. While the market for cars under 7.5 lakh rupees has shrunk from 60 per cent to 43 per cent over the same period. On the other hand, sales of pricier SUVs have been in the fast lane for some time now. Undeterred, Bhargava says that sales of small cars priced below 7.5 lakh rupees will continue to grow for a long time to come. His rationale for the projection is that over 200 million two-wheeler customers are waiting to upgrade to cars. Also, Bhargava says that a substantial increase in the price of such small cars has forced thousands of would-be buyers to shelve their plans in recent times. But, if India wants to meet its ambitious clean-mobility goals and 2070 emissions targets, the first car these 200 million customers buy can't be powered by internal-combustion engines. Bhargava has the answer. There are two markets in India. There is what he calls the 'Bharat' market for affordable small cars and another one for bigger cars with 20-25 lakh rupees price tags. The challenge then is to meet the needs of the former because the current cost of electric cars would be double that of ICE cars. An EV with a 12 lakh rupees tag would not be affordable for most middle-class buyers. Bhargava's solution is alternative technologies. At present, the price of a hybrid car is around 4 lakh rupees more than an ICE-only car. But, Bhargava says that a reduction in the Goods and Services Tax, as in the case of electric cars, would bring down their price to affordable levels. While the cost of hybrids is higher than ICE cars, it is still lower compared to EVs. Also, Hybrids may be best suited for Indian conditions as they don’t require charging infrastructure. But, EVs attract a GST of 5 per cent, while hybrids attract a much higher 43 per cent GST. India recorded sales of 115,032 hybrids in FY22, which is just 4.2 per cent of the 2.7 million passenger vehicles sold. Still, promoting hybrids might be the right solution for pushing EV adoption in India. Nomura Research Institute sees the share of hybrids in total PV sales doubling in FY25. In three or four years, they may become affordable, backed by Japanese carmakers. But, earlier attempts to popularise hybrids in India had failed in the absence of policy support and incentives. So, is GST rate parity between hybrids and EVs needed? E[xpert byte] Maruti Suzuki is not the only carmaker pitching for hybrids. Honda Cars India also says that lowering taxes on hybrids can speed up EV adoption in India. So, is this more of a strategy for Maruti to catch up with its peers in EV technology? Maruti Suzuki and Toyota have put their weight behind hybrid technology and even received a favourable market response. Unlike in the case of Mahindra & Mahindra and Tata, fully electric cars from Maruti and Toyota will not hit the market before 2025. [Expert byte] Hybrids appear to be a good stepping stone in India’s transition from ICE cars to EVs, especially till external charging infrastructure catches up. The ball is now in the government’s court.
Enacted in 1988, the Benami Transactions (Prohibition) Act bars ‘Benami’ transactions and gives government the right to confiscate ‘Benami’ property. What is a Benami property? ‘Benami’ is a Hindi word which means ‘without a name'. A ‘Benami’ transaction is carried out on a fictitious name. Or the real owner buys it on someone else’s name to make profit and circumvent the tax laws. The acts says that a ‘Benami’ transaction is a deal “where a property is transferred to or is held by, a person, and the consideration for such property has been provided, or paid by, another person". It also includes transactions where “the property is held for the immediate or future benefit, direct or indirect, of the person who has provided the consideration.” In simpler terms, if "A" has paid for the property, but it is in the name of some other person "B", it is labelled as a Benami property. Here, if either A or B are fictitious, the property is considered a Benami property. This law also stands in the case of the owner denying any knowledge of holding such property. Cash and sensitive information can also be termed as 'property' under the act. According to section 5 of the law, the Centre can confiscate any property that has been tagged as a Benami property. But there are some exemptions in the law. When the property is held by a member of a Hindu undivided family (HUF) on behalf of the HUF, or on behalf of his spouse or children, it cannot be considered Benami. Also, if the property is held in a fiduciary capacity, it does not come under the ambit of the law. The major point of contention here is the amendments to the act in 2016. Let us have a look at the amendments: The amendment that came into effect on November 1, 2016, inserted a sub-section 2 in section 3 of part 3 of the act. It specified that whoever enters a Benami transaction shall be punishable with imprisonment for a term of up to three years or a fine or both. This has been termed unconstitutional by the Supreme Court. What has the Supreme Court said about the law? SC bench led by CJI NV Ramana, on Tuesday, stated that the provisions under section 3 are “unduly harsh” and declared them unconstitutional. The provisions under section 5, which allows the government to confiscate the property, were also declared unconstitutional as they were “half-baked”.
One of the most awaited Annual General Meetings of India Inc – that of Reliance Industries – will be held on Monday, August 29. Announcing the launch of Jio Phone with refundable deposit in its AGM in July 2017 to laying out new energy blueprint with Rs 75,000 crore investment in the one held in 2021, RIL is known for making big-bang announcements in its AGMs. And this time could be no different. The Mukesh Ambani-led company’s AGM could yet again spell out details on how the company plans to embark on the journey of new energy as well as 5G technology. Besides, the Ambani’s plan to unleash growth potential of Reliance Retail would also be keenly watched by market participants and investors alike. Deven Choksey , Managing Director, KR Choksey Investment Managers says, plans for 5G likely to hog limelight. 5G will drive IoT, cloud computing businesses. Reliance Retail to be another focus area this time. Expect updates on synergies from strategic investments in the vertical. Analysts, however, believe that despite the two segments seeing tremendous strength, Mukesh Ambani may not give detailed timeline regarding their stock market listing. What investors could see, though, is an update on the progress made on the same, they say. Experts believe the chairman may give specifics on how he plans to invest 75,000-crore rupees that he had set aside for the new energy vertical last year. Nirav Karkera, Head – Research, Fisdom says RIL has been developing green energy ecosystem. Expect update on synergies from these activities, he says, adding that one should expect updates on green hydrogen, solar power segments at the AGM this year. Along with the new energy segment, the company may also revive plans of an oil-to-chemicals demerger, which was shelved last year. Overall, Reliance Industries’ 45th AGM is expected to be an announcement-heavy one, with details being given on the acquisitions and investments done so far. As regards today, all eyes will be on US Federal Reserve chairman Jerome Powell’s address at the Jackson Hole Symposium. Besides, oil price movement, foreign fund flow and stock-specific action will guide the markets.
Maruti Suzuki Chairman RC Bhargava believes that if a company wants to succeed, it must keep an ear to the ground and know what the consumer wants. 88-year-old Bhargava -- who at the helm of Maruti Suzuki helped make cars affordable for millions of middle class Indians -- has now appealed to the government to incentivise alternative technology for small cars. And, he is dead set against blindly replicating the western model. But, why focus on small cars? After all, the market share of cars priced below 5 lakh rupees has shrunk from 25.8 per cent in FY19 to just 10.3 per cent in FY22. While the market for cars under 7.5 lakh rupees has shrunk from 60 per cent to 43 per cent over the same period. On the other hand, sales of pricier SUVs have been in the fast lane for some time now. Undeterred, Bhargava says that sales of small cars priced below 7.5 lakh rupees will continue to grow for a long time to come. His rationale for the projection is that over 200 million two-wheeler customers are waiting to upgrade to cars. Also, Bhargava says that a substantial increase in the price of such small cars has forced thousands of would-be buyers to shelve their plans in recent times. But, if India wants to meet its ambitious clean-mobility goals and 2070 emissions targets, the first car these 200 million customers buy can't be powered by internal-combustion engines. Bhargava has the answer. There are two markets in India. There is what he calls the 'Bharat' market for affordable small cars and another one for bigger cars with 20-25 lakh rupees price tags. The challenge then is to meet the needs of the former because the current cost of electric cars would be double that of ICE cars. An EV with a 12 lakh rupees tag would not be affordable for most middle-class buyers. Bhargava's solution is alternative technologies. At present, the price of a hybrid car is around 4 lakh rupees more than an ICE-only car. But, Bhargava says that a reduction in the Goods and Services Tax, as in the case of electric cars, would bring down their price to affordable levels. While the cost of hybrids is higher than ICE cars, it is still lower compared to EVs. Also, Hybrids may be best suited for Indian conditions as they don’t require charging infrastructure. But, EVs attract a GST of 5 per cent, while hybrids attract a much higher 43 per cent GST. India recorded sales of 115,032 hybrids in FY22, which is just 4.2 per cent of the 2.7 million passenger vehicles sold. Still, promoting hybrids might be the right solution for pushing EV adoption in India. Nomura Research Institute sees the share of hybrids in total PV sales doubling in FY25. In three or four years, they may become affordable, backed by Japanese carmakers. But, earlier attempts to popularise hybrids in India had failed in the absence of policy support and incentives. So, is GST rate parity between hybrids and EVs needed? E[xpert byte] Maruti Suzuki is not the only carmaker pitching for hybrids. Honda Cars India also says that lowering taxes on hybrids can speed up EV adoption in India. So, is this more of a strategy for Maruti to catch up with its peers in EV technology? Maruti Suzuki and Toyota have put their weight behind hybrid technology and even received a favourable market response. Unlike in the case of Mahindra & Mahindra and Tata, fully electric cars from Maruti and Toyota will not hit the market before 2025. [Expert byte] Hybrids appear to be a good stepping stone in India’s transition from ICE cars to EVs, especially till external charging infrastructure catches up. The ball is now in the government’s court.
Maruti Suzuki Chairman RC Bhargava believes that if a company wants to succeed, it must keep an ear to the ground and know what the consumer wants. 88-year-old Bhargava -- who at the helm of Maruti Suzuki helped make cars affordable for millions of middle class Indians -- has now appealed to the government to incentivise alternative technology for small cars. And, he is dead set against blindly replicating the western model. But, why focus on small cars? After all, the market share of cars priced below 5 lakh rupees has shrunk from 25.8 per cent in FY19 to just 10.3 per cent in FY22. While the market for cars under 7.5 lakh rupees has shrunk from 60 per cent to 43 per cent over the same period. On the other hand, sales of pricier SUVs have been in the fast lane for some time now. Undeterred, Bhargava says that sales of small cars priced below 7.5 lakh rupees will continue to grow for a long time to come. His rationale for the projection is that over 200 million two-wheeler customers are waiting to upgrade to cars. Also, Bhargava says that a substantial increase in the price of such small cars has forced thousands of would-be buyers to shelve their plans in recent times. But, if India wants to meet its ambitious clean-mobility goals and 2070 emissions targets, the first car these 200 million customers buy can't be powered by internal-combustion engines. Bhargava has the answer. There are two markets in India. There is what he calls the 'Bharat' market for affordable small cars and another one for bigger cars with 20-25 lakh rupees price tags. The challenge then is to meet the needs of the former because the current cost of electric cars would be double that of ICE cars. An EV with a 12 lakh rupees tag would not be affordable for most middle-class buyers. Bhargava's solution is alternative technologies. At present, the price of a hybrid car is around 4 lakh rupees more than an ICE-only car. But, Bhargava says that a reduction in the Goods and Services Tax, as in the case of electric cars, would bring down their price to affordable levels. While the cost of hybrids is higher than ICE cars, it is still lower compared to EVs. Also, Hybrids may be best suited for Indian conditions as they don’t require charging infrastructure. But, EVs attract a GST of 5 per cent, while hybrids attract a much higher 43 per cent GST. India recorded sales of 115,032 hybrids in FY22, which is just 4.2 per cent of the 2.7 million passenger vehicles sold. Still, promoting hybrids might be the right solution for pushing EV adoption in India. Nomura Research Institute sees the share of hybrids in total PV sales doubling in FY25. In three or four years, they may become affordable, backed by Japanese carmakers. But, earlier attempts to popularise hybrids in India had failed in the absence of policy support and incentives. So, is GST rate parity between hybrids and EVs needed? E[xpert byte] Maruti Suzuki is not the only carmaker pitching for hybrids. Honda Cars India also says that lowering taxes on hybrids can speed up EV adoption in India. So, is this more of a strategy for Maruti to catch up with its peers in EV technology? Maruti Suzuki and Toyota have put their weight behind hybrid technology and even received a favourable market response. Unlike in the case of Mahindra & Mahindra and Tata, fully electric cars from Maruti and Toyota will not hit the market before 2025. [Expert byte] Hybrids appear to be a good stepping stone in India’s transition from ICE cars to EVs, especially till external charging infrastructure catches up. The ball is now in the government’s court.
A delegation of Taiwan’s third-largest fab company is in India to explore the possibility of setting up a manufacturing plant. It is said to be holding preliminary talks with Indian firms for a possible tie-up. This visit comes on the heels of Prime Minister Narendra Modi’s call for making India a “chip maker from a chip taker”. We ask if the government’s latest push will turn India into a chip maker. It is indeed a long haul before India starts producing and exporting advanced semiconductor chips. Let us now move on to another victim of supply chain disruption -- the food. Even as the world looks towards India to raise the bar and fill the void created by the Russia-Ukraine war, a drop in paddy acreage is threatening to make the matter worse. From lush paddy fields, let us move on to the hustle and bustle of markets. The proposed NDTV's takeover by Adani Group marks Gautam Adani’s second media bet in 2022 after the firm acquired Quintillion Business Media Ltd in May this year. While the acquisition seems to be ‘hostile’, analysts believe it is the retail investors that stand to win. The remarks made by NDTV’s promoters suggest the takeover was against their wishes. Some are even calling it a “hostile takeover”. This episode of the podcast tells more about it.
Following Russia's invasion of Ukraine and amid challenges for global food supply, PM Narendra Modi declared that India was capable of "feeding the world". However, instead of feeding the world, the govt soon restricted wheat exports, citing a threat to food security. Now, there are concerns about the outlook of rice production going forward. The area planted under the rice crop in the country is down this year. In the week ended August 18, paddy acreage in the country was down 8.25 per cent over the same period last year. Paddy is the most important crop during the Kharif season, and over 80 per cent of India’s total rice production is done during this season. The lower paddy acreage is attributed to the erratic monsoon. Rice cultivation usually requires large amounts of water, and farmers in states without adequate irrigation facilities depend heavily on the monsoon. According to the IMD, rainfall is deficient in major rice-producing states This is reflected in the shrinking paddy acreage in these states. It is down by almost 340,000 hectares in Bihar, 1.14 million hectares in Jharkhand, 630,000 hectares in West Bengal, and 270,000 hectares in Uttar Pradesh. In the previous season, India produced over 111 million tonnes of rice. According to a report by the US department of agriculture, India’s rice production is estimated to decline by 0.9% to 128.5 million tonnes for the full 2022-23 crop year. This could be the first drop in rice output since 2015-16. For the 2021-22 crop year, India’s rice production was at a record 130.2 million. So, what are the implications of lower rice production in India? The decline in rice output could also hit exports and affect global supply dynamics. India is the largest exporter of rice and accounts for 40% of the global rice trade, supplying rice to over 100 countries. Lower rice production in India could have implications for food inflation in rice-importing countries. Major customers are India’s neighbours, including Bangladesh, China, Nepal and some other middle eastern nations. India exported 21.2 million tonnes of rice in 2021-22, of which 3.94 million tonnes was the basmati variety. [Byte of Harsh Wardhan, Fellow, ICRIER] Combined in this order: [0:18 min to 0:33 min and 1:15 min to 1:21 min and 2:39 min to 2:49 min and 2:54 min to 3:04 min] Download link: https://we.tl/t-9k1YSGvX6x According to the USDA report released earlier this month, India is projected to increase shipments, and the global rice trade in the calendar year 2023 is pegged at 54.7 million tons. Rice traders earlier hoped to cash in on the drop in rice crop yields and high production costs in Thailand and Vietnam, but the lag in paddy acreage in the country has been a letdown. [Byte of Mahendra Dev, Director and VC, IGIDR] Besides the impact on exports, lower rice production also has implications for India’s domestic market. However, unlike wheat, the Central pool of rice stock is at 47 million tonnes as against a buffer norm of just over 13 million tonnes. This also includes the rice yet to be received from millers by the Food Corporation of India. Given the current scenario of wheat and paddy, it will also be interesting to see whether the government will extend the free food grain scheme beyond September 30. As the peak paddy sowing season is over, the outlook still looks bleak. If prices continue to soar, export restrictions cannot be ruled out. But experts say the curbs, if imposed, should not be drastic like outright bans and could be in the form of higher tariffs and minimum export prices.
In December last year, the government approved a $10 billion package to give a fillip to semiconductor manufacturing in India. This incentive could mark the beginning of India’s latest foray at grabbing a share of the $107 billion global foundry market, 64 per cent of which is controlled by a tiny nation -- Taiwan. So far, the scheme has attracted three players. They have already submitted proposals for setting up fab plants in India. The first is Vedanta, along with Taiwanese contract manufacturer Foxconn. The second is ISMC, a consortium led by India-based investment firm Next Orbit, which has entered a tie-up with Tower Corporation Israel. And, the third is Singapore-based IGSS, which has IMEC as a partner. The government, on its part, will provide 50 per cent of the investment cost of setting up a fab plant. Their applications involve a projected investment of $13.6 billion. They have sought support from the Centre to the tune of $5.6 billion. Tata and Vedanta have also shown intrest in setting up semiconductor plants with foreign partnerships. But, India’s track record is not very encouraging. In 2005, bureaucratic hurdles ended up scuttling the plans of multinationals to set up plants in India. Attempts to attract chipmakers in 2017 and 2020 also failed. In 2007, Intel moved to China and Vietnam after showing interest in India. In 2013, the government approved two proposals by Jaypee Group and HSMC. It even promised to subsidise the project cost. However, the projects were aborted after failing to attract investors. So, when in September 2021, Israel-based chipmaker Tower Semiconductor threatened to pull the plug on its India plan over lack of policy clarity, it seemed like history was repeating itself. It had even called for Prime Minister Narendra Modi’s intervention. The company is the technology partner of the Next Orbit Ventures-led consortium. But, in May, ISMC, announced that it had signed an agreement with the Karnataka government to invest $3 billion to set up India’s first and largest semiconductor fab unit in partnership with the same Israeli firm, Tower semiconductors. The current response from these players shows their confidence in the government’s ability to provide adequate infrastructure and incentives. The government is definitely being seen as more welcoming of chipmakers than before. All of this indicates that India's latest foray into the sector is not a false start and might bear fruit. Unlike in 2005 or 2013, the present situation in India is very different. India imports almost all of its chips. According to an analysis of data from the commerce and industry ministry, India's semiconductor imports in 2021-22 increased 65.2 per cent from 2019-20. The Ministry of Electronics and Information Technology estimates that India’s semiconductor market will grow to 63 billion dollars by 2026, from less than $20 billion in 2020. And, with the 5G roll-out underway, wireless communication will drive the country's semiconductor demand. So, the demand is expected to go up, adding to the economic rationale of a domestic chip-making industry. But, will India become a global player in semiconductor chips? Well, it will be an uphill task with little guarantee of success since significant challenges remain. India's $10 billion incentive scheme falls short of competing schemes from countries with larger captive markets. India is not even in the list of top ten in market share of chips. The US has announced an incentive package of $52 billion for chip manufacturing. China will be doling out $150 billion in incentives till 2025. So, India might not be able to attract the number of global chip-makers needed to build critical mass. [Audio byte of Devangshu Datta] Enriched with lessons from previous failures, the government should move ahead with greater resolve, and readiness to make changes wherever necessary. However, it will face signific
Putting an end to months of speculations, billionaire Gautam Adani’s media division officially sought control of New Delhi Television or NDTV, on Tuesday. Adani Group said it had used financial rights to purchase a 29.18% stake in NDTV, through the conversion of loans into an equity stake in the promoter group. It further laid out plans for a subsequent open offer for a stake of another 26% at Rs 294 per share, valued at Rs 493 crore. On its part, NDTV said its founder-promoters had not consented to the exercise of rights. Analysts said, prima facie, the takeover appears to be a ‘hostile’ one, and that the battle of ownership could be a long drawn affair. Thus, they believe the camp that stands to gain the most is that of retail investors. According to AK Prabhakar of IDBI Capital, “In NDTV's case, the retail shareholders stand to gain if the stock price continues to move up. Those who bought the stock at a much lower rate will be better off selling them in the secondary market rather than tendering them via the open offer” – AK Prabhakar, Head of Research, IDBI Capital On the bourses, shares of NDTV hit the 5% upper circuit on Wednesday, hitting a 14-year high of RS 384.50 on the BSE. In the past three months, the stock has zoomed nearly 140%, as compared to 8% rise in the S&P BSE Sensex. Moreover, over the past one year, it has soared 382% as against 6% gain in the benchmark index. That said, independent market analyst Ambareesh Baliga says there is a surprise element in the entire development. Speaking to Business Standard, Baliga says, VCPL was bought at Rs 114 cr. The value of the warrants, however, was close to Rs 800 cr. Public shareholders will not tender shares at a discount. Fund that holds close to 9.75% stake in NDTV could tilt the balance. Public/retail shareholders to benefit the most if the stock gains As per technical charts, NDTV shares can move up another 15% upside and may hit 450 rupees-mark in the near-term. On Thursday, the monthly F&O expiry for August series will drive the markets. Besides, crude oil prices and investors’ anticipation of Fed chair Jerome Powell’s address at Jackson Hole will be eyed.