Innholdsfortegnelse for 30 July 2017 i Business Today

The worry is not just the production loss ... Darjeeling tea is the face of the Indian tea industry Officials of Kolkata-based Indian Tea Association (ITA), the oldest lobby group of tea producers in the country, are in a quandary these days. The supply of the exotic, valuable variety of India tea – Darjeeling tea – has been choked because of political turmoil that has gripped the Darjeeling district of West Bengal. The indefinite strike called by the protestors demanding a separate state, has disrupted the harvesting of tea leaves during the second flush, the dust of which is mostly exported and fetches maximum price. ITA’S Darjeeling office remains shut, and the impact of the supply disruption is beginning to be felt. In volume terms, the quantity of tea that…

AUTO, TRAVEL & HOTELS AIR TRAVEL (OTHER THAN ECONOMY) 9% ↑ 12% ECONOMY CLASS AIR TRAVEL 6% ↓ 5% TWO WHEELERS 24.3% ↑ 28% SMALL PETROL CARS/ COMPACT SUVs 24.3% ↑ 29% LARGE CARS 34.1% ↑ 43% LARGE SUVs 35.9% ↑ 43% AC RESTAURANTS 15%+VAT ↑ 18% HOUSEHOLD ITEMS AIR-CONDITIONER, MICROWAVE, REFRIGERATOR, WASHING MACHINE, FAN, WATER HEATER, MIXER JUICER GRINDER 26-30% ↓ 28% PERSONAL CARE HAIR OIL 26-28% ↑ 18% PERFUMES, DEODORANTS, SHAMPOOS, HAIR CREAM, HAIR DYES 26-28% ↕ 28% GST GRAPHITI EFFECTIVE RATE BEFORE GST ↑ GST RATE COMMUNICATION & ENTERTAINMENT AMUSEMENT PARKS 15% ↑ 18% BROADBAND SERVICES, DTH & CABLE, TELECOM SERVICES 15% ↑ 18% MOVIE TICKETS COSTING MORE THAN ₹100 30% ↓ 28% INSURANCE TERM INSURANCE 15% ↑ 18% ULIPS 15% ↑ 18% ENDOWMENT POLICIES (1ST YEAR)…

As Verizon’s acquisition of Yahoo drew to a close, Marissa Mayer, Yahoo’s former CEO, reportedly remarked that she looks forward to “using Gmail again”. She later clarified in a tweet that she would “continue to use the excellent Yahoo Mail too”. It’s true that Yahoo Mail had been in desperate need of a revamp. And it got one on June 27, 2017. Yahoo Mail’s 225 million monthly users opened their email accounts to see an uncluttered design and improved functionality. The company claims that with this facelift, every part of the interface is ‘faster and more reliable’ particularly for slower connections. The new Yahoo Mail can recognise different screen sizes and its responsive design is quick to adapt, keeping the key elements of the interface unchanged. While the update has…

Investment Mode It has been a busy fortnight for Azim Premji and Nandan Nilekani. PremjiInvest, the family investment arm of Wipro Chairman Azim Premji, bought 2.2 per cent stake in Aditya Birla Capital for ₹703 crore. The deal values Aditya Birla Capital at ₹32,000 crore, the company informed in a BSE filing. Nilekani launched a $100-million start-up investment fund, called The Fundamentum Partnership, in association with venture capitalist Sanjeev Aggarwal. Nilekani said that the fund would invest in two or three start-ups in a year – barring fintech and edutech companies as that would conflict with his other activities. Nilekani also informed that they were open to increasing the funding to $200 million if more opportunities came up. Crossed Swords Cyrus Mistry and Tata Sons made it to the headlines…

In spite of the current stock market rally, the focus is still on quality and the entire market will not start flying all at once The liquidity-driven market rally in India has made investors fearful of a massive and long-term correction. However, Aashish Somaiyaa, Managing Director and Chief Executive of Motilal Oswal Asset Management Company Ltd (MOAMC), thinks a down trend will not last long. In a conversation with Renu Yadav of Money Today, Somaiyaa discusses the current bull run, most lucrative sectors, earnings and returns, and why the US Fed’s rate hike may not affect the Indian market just yet. Edited excerpts: Markets are now trading near lifetime high. Do you see a correction in the near future? By philosophy, we at Motilal Oswal AMC are market/index agnostic, bottom-up…

If you are a salaried person, you are most likely receiving a big chunk of your salary as House Rent Allowance (HRA). In order to lower the tax burden, the Income Tax Department allows a taxpayer to claim tax deduction against HRA if he or she is staying on rent (if the taxpayer is staying in his or her own house, the entire HRA is taxable). However, if you are claiming deduction for HRA, you need to be careful and provide proper proofs. Recently, the Mumbai Income Tax Appellate Tribunal took up a case where a person claimed to have paid rent to her mother, for which she claimed HRA deduction, but could not produce any evidence such as lease/rent agreement, letter to society intimating about the tenancy, bank statement,…

After much dilly-dallying and half-hearted attempts to revive the fortunes of Air India, the government has decided to offload the airline. The fact that Air India’s revival is beyond the wherewithal of the government became evident when Finance Minister Arun Jaitley talked about the need for Air India’s divestiture in a television interview. Since then, things have moved fast. Jaitley’s comments were followed by the cabinet’s inprinciple approval for the stake sale in late June. A group of ministers will delve into the finer details of privatisation, including the amount of stake to be sold, treatment of debt and its subsidiaries, and how to manage public interests. Initially, it seemed that the government may face difficulties. It was believed that AI’S massive debt (`46,570 crore), accumulated losses (`47,440 crore between…

In the last week of June, a 24-year-old, soon-to-be law graduate from Nagpur (his name is irrelevant) tried applying for a post in the Territorial Army. He couldn’t. As it turned out, his Aadhaar (taken several years ago) was cancelled, and nobody – Aadhaar customer care or the Centre — could explain why. Since he is not the type to take to social media to express outrage, he went about getting his Aadhaar reinstated; but the damage was done. It is just a matter of time enough people realise that they have been hard done by just because their Aadhaar wasn’t working when it was supposed to, and for no fault of theirs. But in the Supreme Court, in May, the government painted a different picture. Linking Aadhaar with PAN…

Despite its special status and separate constitution, in one respect Jammu and Kashmir is distressingly similar to the rest of India – banking non-performing assets (NPAs). As of end-December 2016, NPAs (as a percentage of advances) of 46 public and private sector banks in the state were somewhat lower than the national average – 6.93 per cent as against 9.1 per cent – but that is hardly a consolation considering the rate at which they are growing. In end-March 2015, bad loans had stood at ₹1,699 crore or 5 per cent of advances of ₹33,687 crore. By end- December 2016, they had risen to ₹2,677 crore of total advances of ₹38,662 crore or 6.93 per cent. For public sector banks, NPA percentages are comparable – in J&K, 10.81 per cent…

M Veerappa Moily, chairman of the 31-member standing committee of Parliament on finance faced an unusual problem when he reached Delhi on 30 June to attend his committee’s meeting. All conference halls he used to convene such meetings were occupied. It was strange since the meeting was fixed not by him, but, by the Lok Sabha Secretariat itself. He was not the only one to face such a problem. At least two dozen parliamentary committees had received instructions to hold meetings the same day, which resulted in the space crunch. The reason was that the government wanted the committee meetings to coincide with a midnight function to enable members to witness the launch of India’s Goods and Services Tax (GST) regime by Prime Minister Narendra Modi in the Central Hall…

₹4,200 CRORE This is the average monthly inflow into mutual funds via SIPs compared to ₹ 1,500 crore a year ago Three years ago, 40 per cent of HDFC Mutual Fund’s equity portfolio was underperforming its benchmark. The fund house had booked profits in many FMCG and pharmaceutical stocks as its fund managers – led by Chief Investment Officer (CIO) Prashant Jain – felt these sectors were overvalued. Instead, they bet on stocks focused on infrastructure. The call initially seemed a mistake as infrastructure-related stocks remained sluggish, while FMCG and pharmaceutical sectors continued to rally. HDFC Mutual Fund suffered, losing its No. 1 position among equity funds. “We did temporarily lose out by taking that call,” says a senior official at the fund on condition of anonymity. But there was…

With a 3D glass display and Corning Gorilla Glass 5 protection, the HTC U11 looks stunning. The 5.5-inch screen with 2560x1440 pixel resolution offers a crisp and clear display. The reflective liquid glass rear, however, is a fingerprint magnet. The most intriguing part of this new flagship from HTC is the intuitive Edge Sense feature. The U11 has embedded pressure sensors on the sides which when squeezed can launch an app. For instance, I could launch the camera app by lightly squeezing the part below the volume key, and even capture an image by squeezing it again. In the advanced mode, which requires a quick set-up to be enabled, you can launch two apps – one with ‘short squeeze’ and another with ‘squeeze and hold’. You can use this to…

Q. The evolution of the mobile phone has been consumer centric. In future, will mobile become an office productivity tool? The probability of the mobile completely replacing current products is not high, though it can in many situations. In future, you will have the office, home and you on the move…everything will be seamlessly connected between mobiles and computers. Q. In electric cars, battery technology is holding up the growth. How much is battery holding up mobile? The battery has always held up the development of the mobile. If the intensity of the battery can be increased five-to-10 times, the form of the phones and even the battery life in the future will see a complete change. Q. Which way do you think mobile as a form factor is evolving?…

Sachin Gupta is 36 and stays in New Delhi with his wife Tripti (36), two daughters, eight-yearold Aarna and one-and-a-half-year-old Arika, parents and grandmother. He runs his family business, a stock broking services firm, where he is the chief operating officer. The couple’s combined monthly income amounts to Rs 2.5 lakh. And just like other young parents, the Guptas have not given much thought to financial planning for the future until now. The challenge here is to meet all current requirements and build a safety net while preparing for long-term goals such as the daughters’ education and marriage, and the couple’s retirement. The positive thing about the Guptas is that they have no big financial liabilities such as a home loan, a car loan or even a personal loan. But…

“I-square-plus-Tsquare — India and Israel plus Israeli technology and Indian talent, is India-Israel ties for tomorrow.” Israeli Premier Benjamin Netanyahu while welcoming Prime Narendra Modi to his country 2 billion This is the number of monthly Facebook users. It took the social network less than five years to go from one billion to two billion users BENGAL GOVERNOR HITS BACK AT STATE GOVERNMENT The fight between Bengal Chief Minister Mamata Banerjee and Governor Keshari Nath Tripathi over communal violence in North 24 Parganas has intensified. Banerjee was quoted as calling Tripathi a “block president of the BJP”who threatened and insulted her over the phone. A statement by the governor called this an “attempt to cover the lapses of the state government and divert the attention from the main issue of…

Shriram Transport Finance has 854 rural centres. These can help IDFC meet priority sector targets IDFC Group and South India-based financial services giant Shriram Group are reported to be in talks for a merger to create an entity with assets of over ₹2 lakh crore. While the two sides are yet to confirm this, experts say there are several reasons why such a move make sense. Access to new geography The merger will give IDFC Bank access to a well-established network in the entire south. Remember that Kotak Mahindra Bank had done a similar thing a few years ago when it bought ING Vysya Bank. Ready retail portfolio Shriram Group is totally into retail assets. IDFC Bank, which had a corporate background, will get a huge portfolio of retail assets,…

CROP INSURANCE SCHEME Pradhan Mantri Fasal Bima Yojana is a two-year-old product CROP PREMIUM ₹22,600 crore TOTAL SUM ASSURED ₹1,82,600 crore ESTIMATED CLAIMS 80-90% of premium WORST-CASE CLAIMS SCENARIO 350% or Rs 80,000 crore (Figures for FY2017/18) RISING SHARE, HIGHER RISK Total general insurance premium pie TOTAL PREMIUM (ACROSS ALL SECTORS) ₹1,26,000 crore CROP SHARE 18% (Figures for FY2016/17) There is a perception of widespread farm distress along with farmers’ suicides and calls for loan waivers across states. But the business of crop insurance has shown strong growth. On the face of it, all is hunky-dory. Farmers are getting crop coverage even though they pay a hugely subsidised premium of less than 2 per cent of the sum assured. General insurance companies, especially big players like ICICI Lombard, HDFC Ergo…

Natarajan Chandrasekaran had no choice. An avid marathon runner, he has had to change his pace and break into a sprint from the moment he was elevated from chief executive officer and managing director of Tata Consultancy Services (TCS) to chairman of Tata Sons in February this year, effectively making him the head of the Tata empire. The unceremonious removal of Cyrus Mistry last October had sent shockwaves across the vast federation of the 100- odd Tata Group companies, which the brief, temporary return of Ratan Tata as his successor did little to quell. Chandrasekaran knew he had to get a lot done quickly to overcome pain points and bring back calm. His first step was to restore communication with other board members which had practically broken down with Mistry…

ASMUKH ADHIA, revenue secretary and the government’s go-to man on the country’s biggest tax reform – the Goods and Services Tax (GST) – has been fighting a battle on multiple fronts. Over the past few months he has been busy giving finishing touches to the rules of the new law, attending GST Council meetings, clarifying the nitty-gritty of the law to stakeholders while at the same time overseeing the tax department’s preparations ahead of the GST roll-out. Now that GST has been rolled out, Adhia’s latest battle is against “misinformation (about GST) deliberately spread by people with a vested interest”. When Business Today asked him what is the biggest challenge after the launch of GST, he was quick to point out the ‘information gap’ that was still very much there.…

Size of Marriott’s acquisition of Starwood $13 bn THE OUTDOOR infinity pool that overlooks the Arabian Sea was the biggest attraction when the JW Marriott opened at Juhu, Mumbai, in 2004. That was Marriott’s fourth property in India, and the biggest turning point for the hospitality chain, nearly five years after entering the country. Now , the Marriott alone has 36 hotels across seven brands – Courtyard, JW Marriott, Renaissance Hotels, Ritz-Carlton, Fairfield Inn & Suites, Marriott Hotels and Resorts – spread over 19 Indian cities. With Marriott International acquiring Starwood Hotels & Resorts Worldwide in a $13-billion deal last September, Marriott has emerged as the largest hotel company globally and in India. It now has a portfolio of 1.1 million rooms across 5,700 hotels in 110 countries. In India,…

Earlier this year, when Y.V. Reddy, former bureaucrat and governor of RBI, announced that he was penning down a memoir, there was widespread anticipation. Understandable, given that during his tenure in the ministry of finance, RBI and the Finance Commission, he oversaw many rules being rewritten. Advice & Dissent: My Life in Public Service, while earnest, has been hailed as a rather reticent account of Reddy’s prolific career. At the book launch, on a rainy July evening in Hyderabad, when D. Subbarao, the former governor of RBI who took over from Reddy, sought Reddy’s reaction on this, he said, “I don’t think I was restrained in taking decisions, but putting it in public domain, I agree, I have been restrained.” Reddy spoke to Business Today’s E. Kumar Sharma on the…