Innholdsfortegnelse for 4 June 2017 i Business Today

Coca-Cola and Pepsi have not exactly had a peaceful existence in India. In the 1970s, Coke was the only game in town bar a few small regional brands like Duke, but the per capita consumption of soft drinks was minuscule and India was not a big market of beverages by any stretch of imagination. Then the Janata Dal came to power and George Fernandes threw out Coke from India quite unceremoniously in 1977. (IBM was the other big name casualty.) This allowed a number of local players – Parle (of Thums Up, Limca fame), Campa Cola and others – to develop strong brands and good market share. Pepsi started looking at India in the 1980s, but its negotiations with the government were slow and prolonged. It first tried to enter…

16 A DIGITAL FUTURE WHAT: CII Webinar on Digital Finance for MSMEs WHEN: May 16 WHAT TO LOOK FOR: MSMEs along with various financial institutions are taking various initiatives in formulating policies and exploring new avenues and strategies for finance. CII is organising an online session on ‘Digital Finance for MSMEs' which will focus on how the digitisation of finance is enhancing MSME growth by catering to their financial needs in the most efficient and timely manner. 17-18 ALL ABOUT TEAMWORK WHAT: Workshop on 'Building Effective Teams' WHEN: May 17-18, Mumbai WHAT TO LOOK FOR: No organisation has ever been able to sustain its leadership and growth without strong and effective teams. This CII workshop aims at enabling leaders and managers get insights into effective team building. The two-day workshop…

With the Real Estate Regulation and Development Act (RERA) coming into force from May 1, there is hope that the interests of consumers would be protected and transparency ensured in the sector. However, only 13 states and union territories have notified the rules till now. Some states, like Gujarat, have been accused of diluting the more stringent provisions of the Act in favour of builders. The key fear is that strict implementation of RERA may actually lead to a surge in real estate prices across the country. The sector had been in a slump over the past few years, and the recent demonetisation further dealt a blow. Certain established players have welcomed RERA. Ashish Puravankara, MD of Puravankara Ltd, a Bangalore-headquartered real estate developer, says, “RERA is the muchneeded impetus…

There has seldom been so much fog and noise around a programme as we have around Aadhaar. First conceived under the Vajpayee government as a national ID Card, it was taken up by the UPA as the watered down but heavily hyped Aadhaar. The narratives around this through the entire UPA term were about the miracles of technology and what it would do to transform governance – the broad-brush, sweeping characterisation of the benefit of technology without much thought about how it would be used. As one of the earliest critics of its watered down specs, I jokingly referred to it as a solution looking for a cause way back in 2012. But the few voices like mine that did point out the obvious mistakes in its design and concept…

AYEAR AGO, Captain Pankaj Kumar, owner of a New Delhi-based shipping solutions company, was looking to raise ₹20 lakh. He approached banks for a loan, but soon realised it would be anything but smooth sailing. The banks asked for collateral plus a number of documents, including data registered with the Ministry of Corporate Affairs, three years’ financial statements and business projection for five years. Then, his former banker suggested that he approach CoinTribe, a Gurgaon-based online lending platform that connects creditworthy micro and small enterprises (the company helps individuals as well) with potential lenders such as banks and non-banking financial companies (NBFCs). This time, paperwork was minimal, and the entire process moved fast. Kumar’s plight is not unique. In spite of driving jobs and manufacturing growth, small businesses often have…

Xiaomi is gradually stepping outside the smartphone arena and launching its ecosystem products in India. After air purifiers, the company has launched a smart Wi-Fi router. Amid a plethora of routers available in the market, the Xiaomi Mi Wi-Fi 3C stands out as an affordable smart router with app controls. Here is a detailed review. DESIGN: The most striking aspect of the 3C is its simplistic design. The router, in white, has a straight-line design with four antennas at the back. Unlike traditional routers, this one is sleek and does not have any hardware button. A blue light gets illuminated once connected. The box contains a router, power cable and a manual. You will have to buy (or search for a spare) a LAN cable to connect the 3C to…

Nachiket Mor, Country Director, Bill & Melinda Gates Foundation (BMGF), India, talks to Joe C. Mathew about the foundation’s work in India. Global funds are often criticised for pushing new vaccines that are perhaps non-essential. What’s your approach? Vaccines that are globally available have been fully approved for use in India and are already available in the private sector. So, there is no question of pushing medicines that are not already locally available. The real debate is about the feasibility of making them available free of cost. The government, along with eminent scientists and administrators, has a well-structured process for making these decisions. Our support, provided only at the government’s request, is designed to ensure that the best of data and analysis are made available to them. The National Technical…

The Nifty has traversed a full circle in two years – from approximately 9,000 in March 2015 to back to 9,000-plus. In April, the first month of financial year (FY) 2018, the markets retained the momentum built in FY17. Valuations for the Nifty, based on both one-year forward earnings and trailing earnings, are rich. But the underlying near-term operating backdrop for India Inc. remains hazy. There are no visible signs of an immediate recovery in earnings although the fourth quarter performance of FY17 may be boosted by the depressed base for some cyclicals. FY17 started with hopes of an earnings recovery, backed by expectations of good monsoon, the seventh Pay Commission awards and macro buoyancy. However, continued weakness in private capex cycle, absence of broader consumption pick-up and sluggish asset…

Igniting Passions for Developmental Strides This refers to your cover story on pharma industry (Pharma’s Next Gen, May 21). The strategic plans and actions of the youngsters in successfully taking the baton of responsibilities involving diagnosis of issues, entrenching prognosis of market conditions, and practical wisdom and expertise will help other companies to revisit their portfolio of products and catalyse positive interventions accordingly. The new-age industrialists offer a healing touch to their operations, lead the lamps of insightful ideas of their forefathers-cum-founders and ignite innovative passions for developmental strides. They get to the bottom of the issues and show a clean pair of heels in the midst of the business risks and market difficulties. The isolation of Indian pharmas by the US Food and Drug Administration’s conditional obligations, including their…

Silence is not golden; not on social media. United Airlines learnt this the hard way recently. When the video of an Asian man being dragged out of a United Airlines flight, on account of the flight being overbooked, created a furore on social media, the airline maintained a stoic silence. Twitterati erupted in outrage – some boycotting the airline, others sharing their own horror stories – as the video topped the trending chart. The Chicagobased airline underestimated the gravity of the situation. It took too long to react, and when it did, the clarification was impassive. A Facebook post, tweet or WhatsApp message has the potential to spread like wildfire, if not dealt with in time. “Companies can no longer sweep complaints under the rug. They have to keep a…

Any suggestion that farm incomes should be brought under the tax ambit tends to send Indian politicians into a tizzy. Recently, a comment by economist and Niti Aayog member Bibek Debroy that rich farmers could be taxed forced Finance Minister Arun Jaitley to hastily clarify that the government was not planning any steps towards taxing farm or agricultural income. Even Niti Aayog distanced itself from Debroy’s comment, saying it was his personal opinion and not a recommendation made by the institution per se. From the government’s point of view, farm tax proposals are a political hot potato. Roughly, half of the country’s working population is still directly or indirectly employed in farming or farm-related activity. But the vast majority of the cultivators barely manage to eke out a living from…

Flyers have been in the news. First there was an unshaven legislator from a western state of India. He got into a flight to the seat of power up north, and ensconced himself in a snug front seat. After he landed, he refused to leave the plane. When the airline staff tried to persuade him to move, he tried out fisticuffs, and wielded footwear when fists were not enough to show his prowess. For a while he had an unfair advantage, for the staff had inhibitions against such manual techniques. But finally he was badly outnumbered. He saw the point, that none of the weapons at his command – his name, his voice, his fists – was enough to keep him in the seat, and he allowed himself to be…

The Curious Marketer: Expeditions in Branding and Consumer Behaviour BY HARISH BHAT PAGES: 272 PRICE: ₹599 PENGUIN RANDOM HOUSE It was a hot summer. As a young management trainee, I was despatched to spend a month in Rajastan with the sales representative of Ciba-Geigy – the company whose toothpaste brand was being handled by the ad agency I joined after my MBA. I was told to write a daily report and send it by post (remember those red boxes?) to my boss who was comfortably ensconced in his air-conditioned office in Mumbai, then Bombay. Instead of writing a boring report on the number of outlets covered, orders booked and average value per order, I decided to make each report a little story about the market that I worked in –…

The medium-to-long-term prospects of Indian equities are exciting. But the market never moves in a straight line and corrections are a healthy part of any bull market. So it is not very useful to try and predict market movements over 6-12 months. Indian equity markets were up by 19 per cent in the financial year 2017 in spite of 10-11 per cent correction witnessed in the September-December quarter. Markets in the short term are all about sentiment and flows, and these have supported the recent rally. We are also seeing a reduction in India’s risk premium due to a steady improvement in macro fundamentals and the structural reforms carried out by the government. This is helping the medium-term bull case for both equities and bonds. With the economy set to…

A re you ready for that great trip abroad this summer – picked your favourite spot, booked your vacation and planned your activities? Wait a minute, though; have you taken an adequate travel cover prior to your trip? Nothing is too safe nowadays and there can be high-impact incidents – right from travel delays and flight cancellations to illnesses/injuries, loss or theft of passport, money and baggage, and worse still, unforeseen sociopolitical issues that can leave you stranded. Things tend to escalate when you are travelling overseas. But your travel insurance can come in handy in such cases, ensuring that you do not end up spending a fortune. Whether you are a holidaymaker visiting a foreign land or on an important business trip, picking the right insurance is bound to…

QUOTE “Experts often refuse to speak truth to power. After policy actions, they try hard to endorse the decisions already taken. As a result, we in the government do not really benefit from their wisdom” Chief Economic Advisor Arvind Subramanian NOD FOR SNAPDEAL SALE Japan’s SoftBank is reported to have got approval from Nexus Venture Partners for sale of Snapdeal to Flipkart. SoftBank, which is the largest shareholder in Snapdeal, had secured the go-ahead from the founders last month. However, Nexus had problems with the valuation. ESSAR-ROSNEFT DEAL IN TROUBLE? Russia’s oil firm Rosneft is finding it tough to close its $12.9 billion acquisition of Essar Oil Ltd, according to media reports. Six of Essar’s Indian creditors are yet to approve the deal, they said. The deal is important for…

NARENDRA MODI swept to power in 2014 amid great expectations from the world of business. He was expected to set the house in order, usher in next phase of economic reforms and put India’s growth story back on track. Three years on its time for a reality check. Has Modi risen to the occasion and delivered the goods? Business Today joined hands with BMR Advisors for a survey to gauge the sentiment of corporate India. A poll of select CEOs and CFOs from diverse industries was conducted between April 11 to April 25. It captures the mood of the industry and its assessment of the progress of the government’s key programmes and flagship schemes. Impressed, But Not Thrilled The Modi government has taken several measures to lift growth. Indeed, nearly…

When the entire banking industry of a country as large as ours is paralysed to a point where it becomes necessary to empower the Reserve Bank of India, the banking regulator, “to issue directions to any banking company(ies) to initiate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016”, can we agree that further proof of complete institutional breakdown is unnecessary? How did we get to this point? Allow me some oversimplification. Till Indira Gandhi’s socialist ideal of the 1970s, India worked on the idea that lending decisions must be driven by commercial considerations. Bank nationalisation ushered in the age of priority sector lending and monkey circus that her Minister Janardan Poojari called ‘loan melas’. Nationalisation converted lender decisions into ‘political decisions’ which, if you know your Indian English,…

10001101010001110101011000100100011010100011101010110001 T here has been a flurry of activity in the financial sector. As we go to press, six small finance banks – a new category of banks to advance the government's financial inclusion agenda – have started operations, out of the 10 that had got the Reserve Bank of India’s, or RBI’s, “in-principal” approval in September 2015. These include, two which took off last year – Equitas in Chennai and Capital Local Area Bank in Jalandhar. Thereafter, since January, five more have got the RBI’s nod, of which four have started operations. Most of these new banks have a similar past. Apart from Au Financiers (India) Ltd, Jaipur, and Capital Local Area Bank, they have been high-performing microfinance institutions or MFIs. And most are from the financially well-served regions…

Since the beginning of 2017, the market has been rising steadily largely due to sensible and pragmatic government policies, and the heightened appeal of financial assets compared to mere physical ones. The Indian economy is traversing an upward course where both macro and micro-environments are turning out to be vastly beneficial. As a result, the market valuation on price-toearnings basis is quoting a tad above fair value. Understandably, there are concerns regarding the stability of the current surge and there are three options investors can consider depending on their risk appetite. But before that, one should understand the current environment. The Indian economy has come a long way from the problems it had faced earlier. The gross domestic product (GDP) has risen from 5.6 per cent in financial year (FY)…

Choosing the right income tax form is important. Using the wrong one means the return will be rejected. For assessment year 2017-18, the Central Board of Direct Taxes has notified new simplified income tax return forms. It has also made several changes in older forms that you should be aware about, especially if you file returns on your own. DECLARE CASH DEPOSITED IN BANKS DURING DEMONETISATION Those who deposited Rs 2 lakh or more in an account during the demonetisation period will have to mention the amount deposited and details such as bank name, branch, IFS code, and account number in a new column. “At the time of demonetisation, the authority concerned had said that the probability of receiving a notice for depositing cash will be less in cases where…

Rashpal Singh Rana, 49, stays in Faridabad with wife Bimal, 43, and son Vishal, 23. Rana was into advertising, but left his job and started his own advertising and marketing solutions business. Vishal was sent to the UK, where he studied for three years in Manchester University and then worked in Scotland for a year. Rashpal plans to send his son to the US next year for higher studies and is also planning for his son’s marriage by 2023. Plus there will be a family trip to Canada this June and the Rana’s have to prepare for that. Their monthly income amounts to Rs 3.20 lakh while household expenses add up to Rs 1.62 lakh and total insurance premiums cost them Rs 12,000 a month. It shows they have managed…