Innholdsfortegnelse for 2-Jun-19 i Business Today

THE INDIAN corporate bond market is jittery. Debt mutual fund managers are also feeling the heat. And the commercial paper market has almost dried up. The general nervousness is because of a chain of events that started with the first Infrastructure Leasing & Financial Systems (IL&FS) debt default that took place in June last year. Nobody knows which is the next nonbanking financial sector (NBFC) company or Housing Finance Company (HFC) that will find it difficult to repay its debt. And what kind of chain reaction that will set off. Initially, it seemed that the swift action of the government in replacing the board of IL&FS would solve the crisis. IL&FS had over ₹91,000 crore debt, but it was apparent that not all of it would be unpayable. After all,…

PRIME MINISTER Narendra Modi might be busy campaigning, but his office, along with the government’s think-tank, NITI Aayog, have started work on the agenda for the first 100 days of the next government. A top official told BT this includes further freeing up sectors such as infrastructure (road, rivers, railways, airports, ports), oil and gas, education and healthcare from red tape. They are also working out plans to push investments in MSMEs, mining, power, education and primary healthcare. Inputs have been sought from the top CEOs of these sectors. Officials have started studying the BJP’s poll manifesto. Opposition leaders taunt this as over-confidence of the PM and his team. Officials are also working on the agenda for the possible September visit of the prime minister to Russia. Officials said Modi…

MARKET PULSE WHAT: Marketing Analytics Summit WHEN: June 24-25, Mumbai WHAT TO LOOK FOR: The summit will help attendees improvise their marketing measurement efforts. Experts will explain how to make use of latest tools and technologies to boost marketing return on investment. EVOLVING EXECUTIVE WHAT: Future Executive Assistant Summit and Awards WHEN: June 26, Delhi WHAT TO LOOK FOR: The theme of the event is 'The Evolving EA - Innovative and Strategic'. The event will give an opportunity to hear success stories of exceptional and inspirational leaders and use their insights for personal growth. PROTECT INTELLECT WHAT: IPR Summit WHEN: June 27-28, Mumbai WHAT TO LOOK FOR: The second edition of IPR (intellectual property rights) Summit will bring together IP leaders from across the country to discuss a wide range…

Debt funds are fast losing sheen as they draw fire for falling prey to defaulting securities. A host of negative incidents such as fixed maturity plans (FMPs) not paying full maturity amounts, and erosion of debt funds’ NAVs have put a question mark on their stability. This also makes them a weak link in the chain. The past 8-9 months have been particularly brutal for the debt mutual fund (MF) schemes, which manage ₹11.63 lakh crore, due to a series of defaults in the Indian bond market. This is cause for serious concern as, according to Association of Mutual Funds in India (AMFI) March data, income funds and liquid funds together make up as much as 48 per cent of the ₹24 lakh crore Indian MF industry. Any trouble will…

There have been many reforms in debt markets over the past few years, but it’s important to hasten the pace utilising digitisation to create market transparency, higher liquidity and appropriate safety vaults. The debt markets will thrive and be accepted by every section of the market if regulators and market participants are able to deliver an improved and more transparent customer journey. This has been demonstrated in the government bonds markets via the market framework developed by the RBI. This transparent framework needs to flow through to all credit markets. The latest dislocation in the credit markets, especially in NBFCs, has eroded investor confidence. The root cause of this dislocation lies on the issuer’s side, mainly excessive reliance on short-term funding to save costs and the resultant asset liability gaps.…

₹4,500 CRORE Size of the Indian Toy Industry 12-13% Share of the Organised Toy Market 87-88% Share of Foreign (Imported) Toys 2% Rate of growth HAMLEYS, BIG BAZAAR, DMART, CROSSWORD Top Toy Retailers in India MATTEL, FISCHER PRICE, FUNSKOOL, SHINSEI TOYS, SAPPHIRE The few Leading Toy Brands in India…

Mid-size companies with budgets of ₹10-30 crore and which don’t have the expertise can pool resources with other companies. The Ambuja Foundation, for example, attracts CSR funding from other firms as well Companies can work with the government – instead of in parallel – and fill in gaps, for instance, provide counselling and post placement support after skilling Companies can help small and mid-size NGOs build capacity with managerial advice, technological know-how, communications support, and teams of employee volunteers to professionalise the development sector…

PARCHED SOIL, dead cattle, young girls walking miles for a litre of muddy water and villagers digging up dried wells hoping to find a few more drops are a common sight in the eight districts of Maharashtra’s Marath-wada region. The region was declared drought-hit in November 2018. Things have worsened since then. Residents of nearly 2,000 villages get water supply for half an hour once in six days. There are close to 2,050 water tankers but their arrival in villages leads to quarrels about who will get water first. In Tamil Nadu, the state government has declared 24 districts, including Chennai, drought-hit, apart from 38 other blocks in seven districts. Groundwater levels in some districts have dropped by an average of one metre from January. Dying cattle, and fights over…

WE HAVE ALL been there – got excited by trending apps, downloaded them in a hurry and ended up giving them access to our data without being overly concerned. Unlike feature phones, smartphones store a huge amount of information, not just product preferences or shopping history, but also crucial financial and personal details if these are connected to banks and social media accounts. And it definitely feels creepy when ‘idle’ apps on our phones run in the background, secretly tracking our locations and listening to our conversations on behalf of marketers. Worse still, there could be malware hidden deep within them, which initially grabs data and then spreads the spyware. Researchers predict more invasive risks. Voice-controlled personal assistants like Siri, Alexa, Cortana and Google Assistant may pose privacy threats as…

Over the past five years, a goodly number of books have positioned Prime Minister Narendra Modi as the fulcrum around which their economic and political discourses have flourished. Almost all content formats have been used for this purpose, right from a comic book titled Bal Narendra: Childhood Stories of Narendra Modi, published during the run-up to the 2014 polls, to well-researched analyses. And all of them have sought to capture the Modi persona from every possible angle – the man, the administrator, the visionary leader, the diplomat, the master of social engineering and, of course, the flag-bearer of the right-wing Hindutva agenda. Ever since his rise to power, Modi has been a polarising factor, loved and admired by many and loathed by others. Understandably, the books about him are also…

STAY CONNECTED WITH US ON www.facebook.com/BusinessToday@BT_India PERSPECTIVES Nobody Is Batting for “Dirty” Diesel Anymore Today, diesel is dying a slow death, and from policymakers to manufacturers to consumers, nobody is rooting for it businesstoday.in/diesel-demand Bold & Beautiful! TV Shows, Movies Are Now About Good Content Content-focussed films and unconventional originals are finally feeling the need to tell good and hard-hitting stories businesstoday.in/shows.films-content NBFC Bubble: Bursting in Phases? An increasing number of NBFCs face liquidity crunch after a sharp rise in interest cost hit their repayment ability businesstoday.in/nbfc-liquiditycrunch Why Ola’s Electric Leap of Faith Could Be a Boon for Auto Sector With a plan of introducing one million electric vehicles across all categories by 2021, Ola Electric has raised close to ₹400 crore from investors, among others businesstoday.in/olaelectric-investors NEWS Coming Soon:…

SEBI’S ORDER on NSE’s colocation (colo) case has put the spotlight on regulations around colo facilities and algorithm (algo) trading and the fact that it is hard to prove fraud in such cases. Although Sebi asked the NSE to disgorge ₹1,100 crore, it could not establish if the exchange has violated regulations. The penalty pertains to lax corporate governance and is only half the ₹2,000 crore it earned from colo between September 2016 and December 2018. At a time when artificial intelligence (AI)-based software programmes are able to exploit millisecond changes in stock prices, it is only obvious that the quantum of high-frequency trades (HFTs) will swell. Colo, dark fibre and AI are the future. Meanwhile, issues around unfair access, information asymmetry and possibility of flash crash linger on. Last…

THE EFFORTS of Indian drug makers to satisfy the ever increasing stringent manufacturing benchmarks of the United States Food and Drug Administration (USFDA) have started yielding results. In 2018, India, which has the largest number of US regulator approved pharmaceutical plants outside the US, got only 15 warning letters (warning to stop production if shortcomings are not sorted out within a specified period), lower than 19 for US companies and 24 for Chinese companies. In 2015, India had topped the list with nine warning letters and almost all leading drug companies exporting to the US had to face manufacturing standard issues with their plants. Since then, awareness has increased among Indian manufacturers on improving quality standards and most companies are working with global consultants for upgrading manufacturing and data standards.…

UBER GOES PUBLIC AT LAST, VALUED AT $74 Bn Ride-sharing behemoth Uber raised $8.1 billion in its initial public offering after pricing its shares near the bottom of its expected range. The company sold 180 million shares for $45 each while the marketed range was $44-50. Based on the amount of outstanding stock after the IPO, the pricing gives the San Francisco-based company a market value of nearly $74 billion, much below its last private market value of $76 billion. After calculating the fully diluted value, including restricted stocks and other shares, the final valuation could be about $82 billion. Uber’s IPO was the biggest on a U.S. stock exchange since Alibaba Group Holding’s $25 billion global record holder in 2014, says Bloomberg. It is also one of the 10…

The liquidity crisis that is roiling non-banking finance companies (NBFCs) has hit the one part of Anil Ambani’s debt-strapped business empire that was going strong — its financial services business. Three rating agencies – CARE, ICRA and Brickwork – have downgraded the borrowings of Reliance Capital (RCap) and its subsidiaries. The debt crisis, which had overtaken the Reliance Group’s telecom, power distribution and media businesses earlier, had an immediate effect on RCap shares, which fell from ₹184.05 on April 15 to ₹132.85 on April 30. They have since dropped further to ₹121.15 (May 7). CARE lowered the rating of some of RCap’s debt instruments to ‘D’, which means the debt facility is ei-ther in default or is expected to be so soon. “The rating revision takes into account the recent…

The Indian mutual fund (MF) industry has grown exponentially over the last decade. However, defaults by the IL&FS group last year brought attention to the credit risks in debt mutual funds and exposures to NBFCs. Assets under management grew from ₹4.17 lakh crore on March 31, 2009 to ₹23.8 lakh crore on March 31, 2019, an over five-fold increase in a decade. There are 26 million SIP accounts, and about 913,000 SIP accounts on an average were added each month during 2018/19, according to the Association of Mutual Funds of India. There are various factors responsible for the fast expansion of the financial services industry as a whole. Not just MFs, in recent years, non-banking finance companies (NBFCs), too, have grown – at a fast 30 per cent per annum…

The world thinks you are a media company. You are convinced you are a technology platform. How do you marry the two realities? What is the vision? The vision for YouTube is that we become a platform for the next million channels. When I was here (in India) in 1991, there was one government broadcaster. Then satellite and cable channels were introduced, and now there are hundreds. Earlier, we couldn’t have millions of channels as technology didn’t enable it. The channels would have been too hard to find. We didn’t have search or recommendations or personalisation. Technology enables millions of channels on very specific topics. Our vision for YouTube is that we are the platform that enables the next million channels. But regulators still see you as a media company…

Describe Aguapuro’s journey since its inception. Aguapuro stands tall as a trusted name in the global market for delivering one roof turnkey solutions in the field of Water & Waste Water Treatment Plant across industrial, residential and commercial segments. Aguapuro was founded and established by Jitendra CRane & Rashmy J Rane having vast experience in the field of Water & Waste Water Treatment. The company is today barreling way ahead in this field with more than 2000 plants commissioned successfully throughout the globe over the past two decades and is recognized by their quality, smallest lead time and 99% zero service call factor, had avery humble beginning. The domino was instigated in 1998 by one of our customer, who approached us for setting up afiltration unit and ended up giving…

Another two billion people, or one-quarter of the current global population, are expected to move to cities just three decades from now. They will all need water – to drink, bathe, wash clothes and dishes, and for electricity – even as weather patterns become increasingly uncertain. Forecasts say urban water consumption might increase 80 per cent by 2050. Growing abuse will leave this seemingly infinite resource polluted and contaminated. Water will be the deciding factor on whether India will prosper or not. Research by the Centre for Science and Environment (CSE) in its State of India’s Environment Report Excreta Matters shows there is no information available on how much water is actually needed, supplied or even reaches users. There is no real-time information about water use in different sectors –…

Of late, systematic investment plans, or SIPs, offered by mutual funds, have captured the imagination of individual investors in India as testified by the soaring inflows. As per data disclosed by the Association of Mutual Funds in India, the net monthly inflow through SIPs has risen progressively from ₹3,122 crore in April 2016 to over ₹8,000 crore as of March 2019. With this, the overall inflow between April 2016 and March 2019 stands at ₹2.04 lakh crore, accounting for 42 per cent of the overall net flow into equity-oriented mutual funds and 28 per cent of the overall industry. This is heartening for two major reasons. First, it adds depth to the underlying equity and debt markets, and second, it allows more investors to reap the gains thereon. However, an…

SOFTWARE developer Ibrahim Diallo had a nightmarish experience last July. When he tried to walk into his office, nestled within a Los Angeles skyscraper, his security pass did not allow him in. A friendly guard did, but it was not the end of the story. Many doors on the inside denied him entry, and so did his computer. Critical files disappeared as his computer login failed; the system rebooted automatically and, finally, revoked his access. What started as a slightly bizarre tech error, led to apocalyptic reactions as nothing could be done to get Diallo another pass or restore his access. Not even his bosses could overrule the system although they assured everyone that he was still employed. The incident escalated to a three-week work outage because an outgoing manager…

THE HOT AND HUMID Indian summer is back and with it comes a host of health issues, ranging from exhaustion and muscle cramp to sunstroke, dehydration and more. Do not be too worried, though, as a few precautions and some home remedies can ward off many of these heat-related ailments. Doctors advise adequate intake of fluids and electrolytes (sodium, potassium and other minerals) as we lose these when we sweat. Most importantly, eat freshly prepared, non-spicy foods to keep your body healthy and rejuvenated. What tends to go unnoticed many a time is how the scorching heat can damage the digestive system or the gut. The human intestine contains varieties of microorganisms, including bacteria, viruses and fungi. Our gut microbiome or microbiota – basically all the 300-500 types of bacteria…

KAN KUNIMURA DIRECTOR OF SMALL AND MEDIUM BUSINESSES (ASIA-PACIFIC), ZENDESK He built the San Francisco-based CRM company’s Japan business. India is among Zendesk’s fastest growing markets in APAC and it caters to 2,500-plus Indian companies. It will now bet on start-up-specific programmes in India to help digital and omnichannel businesses. Q. The biggest challenge you faced in your career A. When Zendesk entered Japan, SaaS was a relatively new concept and we needed to convince people. Then again, when an overseas company enters a foreign market that speaks a different language, operations must be localised and customised. It meant all our marketing and sales material had to be developed from scratch. The next step was to scale up the business. But it was not too difficult as our ethos is…

THE ODISHA GOVERNMENT’S disaster management during the recent Cyclone Fani has been lauded the world over. Despite a wind speed of close to 200 kilometres per hour, Cyclone Fani led to 35-odd casualties as opposed to over 10,000 deaths in the 1999 Super Cyclone, thanks to timely warning from the meteorological department. Over 1.2 million people were shifted to safety. However, with natural disasters becoming increasingly common, it’s time the government focuses on building disaster resilient infrastructure. While Odisha has been successful in minimising human casualties, it’s still struggling to have power and telecommunication networks up and running. “The cost of rebuilding the electricity infrastructure alone runs into several hundred crores after each cyclone. We have to rebuild it pole by pole. We have to explore setting up transformers underground…

IT IS JUST the second year but the largest trade infrastructure in the history of mankind, a signature project of Xi Jinping, seems to lose steam. European nations, the US, Russia, Japan and India didn’t turn up for the three-day second Belt and Road Forum for International Cooperation. Those who came lamented that BRI projects continue to impact freedom and openness in the region. Also, the stringent Chinese debt conditions and size of the projects make sustainability questionable. Xi has agreed to recalibrate projects and discuss issues of exclusivity, sustainability and standards. But these players are pushing further to convince Beijing to make the BRI more inclusive by partnering with other countries and organisations, including development banks. Xi has shown the first signs of accommodating, but its impact on the…

THE STATUTORY auditors at the centre of the IL&FS loan default case — Deloitte Haskins & Sells LLP and BSR & Associates LLP — might have gotten themselves into a tight corner with government and regulatory sentiments strongly against them. The auditors have been pleading ‘innocence’ saying that most of the transactions that led to the defaults were beyond the scope of statutory audits and those transactions could only be detected through forensic audits. While Deloitte, which audited the books of two of IL&FS subsidiaries till 2017/18, is saying that if there was anything suspicious in the books, the new auditors would have detected it, BSR & Associates is saying that transactions that led to this crisis were beyond the scope of statutory audits. These explanations clearly are not finding…

In the next three months, ₹ 1 LAKH CRORE of commercial paper raised by NBFCs comes up for redemption Any big failure to meet their payments or issue fresh paper to roll over that debt can TRIGGER OFF A CRISIS It would result in TROUBLE FOR THEIR LENDERS – from banks to mutual funds to others That in turn can create further NEGATIVE SENTIMENT making it difficult to raise money and creating a liquidity crunch for those who borrow from the NBFCs This would affect the REAL ECONOMY And lead to a VICIOUS CYCLE that keeps feeding off each other…

1986 Reliance Capital Ltd incorporated as Reliance Capital & Finance Trust 1990 Comes out with maiden public issue Jan 5, 1995 Changes name to Reliance Capital Ltd Dec 1998 Obtains registration as an NBFC 2001/02 Enters life and general insurance business May 2007 Reliance Consumer Finance starts operations Feb 2019 Edelweiss, L&T Finance Holdings sell shares of Reliance companies in open market Feb 2019 Anil Ambani faces jail term if RCom disobeys SC ruling to pay Ericsson ₹550crore Oct 2017 RCom market share slumps to 5.2% Mar 2017 Sam Ghosh, Capital, quits after a nine-year term Mar 2017 RCom dept rises to ₹47,700 crore 2008 Reliance Power IPO raises ₹11,563 crore April 2019 Brickwork Rating and CARE Ratings downgrade Reliance Capital April 2019 CARE Ratings downgrades Reliance Home Finance long-term…

DO YOU SIT BACK and wait for an annual performance review to think about your work performance? It does feel easier to wait for another person to tell you about how you can improve yourself. But how can you do a better job everyday without waiting for an annual feedback? The trick here is to work on yourself, not the job. Your work reflects you, so begin by making yourself better, and success will follow. Here are nine ways to help you get better at what you do and become the best version of yourself. Turn Weaknesses into Strengths Research shows that 97 per cent of people can readily identify a career-limiting habit they have. However, managers reported only 10 per cent of employees showed a change a year after…

Fixed-income investments in India are traditionally associated with bank fixed deposits (FDs). A large part of retail savings is parked in bank FDs with the perceived notion that there is no risk associated with these. But it is not necessarily the case. Over the past 10 years, and more so since demonetisation, retail investors have increasingly invested in fixed-income funds, which have largely been the traditional bastion of institutional investors. Favourable taxation, potentially higher returns, diversification benefits and professional management are some of the key reasons behind this shift. Again, investors have flocked to fixed-income funds with the perceived notion that returns will be predictable and the funds will be relatively safe. What they have failed to realise is that fixed-income investing also involves some major risks in terms of…

DOCKLESS and appenabled electric scooters are all the rage nowadays, but several riders in Brisbane were in for a cybershock when they rented Lime’s connected scooters. These bikes have voice boxes that connect to the Lime app, can be picked up by a renter and left at a drop point when the ride is over. However, people were taken aback when some of these e-scooters suddenly started shouting sexual comments and other offensive things. In fact, an entire row of stationed scooters could be heard yelling lewd and racist comments, creating an unsavoury cacophony. Undoubtedly, it was some hackers’ idea of an amusing prank – they hacked into the scooters and changed the audio files. A number of videos featuring the shouting scooters have been posted online by media houses…

THE NEW HARDWARE from Google, the Pixel 3a XL, is a toned down version of its flagship Pixel 3 but comes with the same good camera. Still, does it justify the high price tag in India? One will find some excellent features, though. For instance, unlike most of the premium smartphones with a glass rear, the 3a XL has a 6-inch full HD+OLED display in a polycarbonate unibody and the Pixel’s signature dual-tone finish at the back. I was able to choose the display colour from natural, boosted and adaptive modes, and became a big fan of Active Edge, which means squeezing the sides to activate Google Assistant. There is a SIM tray on the left panel, but one can also configure eSIM (works with Airtel and Reliance Jio) in…

UNHEALTHY FOODS and poor lifestyle often affect our gut health. But augmenting the gut’s functions or repairing/recreating organ parts with the help of stem cells, tissue engineering and regenerative medicine may soon become the gold-standard treatment where traditional surgery fails to bring the desired results. “Things are looking up now that we have made the entire oesophagus (the muscular food pipe that connects the throat to the stomach) in the lab,” says Dr Reddy. In a 2016 paper published in the medical journal The Lancet, a team from the Medical College of Wisconsin reported the first case of a human patient whose severely damaged oesophagus was reconstructed using stents and skin tissue. The same team is now working on regenerative medicine in collaboration with Dr Reddy’s AIG. “We are still…