Innholdsfortegnelse for 15-Dec-19 i Business Today

FINALLY, India’s Data Protection Bill will face the floor test in Parliament in the winter session. Last year, the Justice Srikrishna Committee, after a detailed consultation, had presented the draft Bill to the Ministry of Electronics and Information Technology. The Bill seeks to regulate the processing of personal data of individuals by government and private entities incorporated in India and abroad. The Bill says that when it comes to personal data, the 'golden copy' (the master version of data) abroad must have a 'silver copy' (the mirrored version) in India. Also, it seeks to ensure that certain critical personal data is entirely stored in India. While companies have already started gearing towards data localisation, the transitioning cost has always been the talking point. Many others are seeing this as…

THE DOUBLE-digit surge in India Inc’s profits in the September quarter (ex-telecom) should be taken with a pinch of salt. Thanks to one-time gains in profit — on the back of corporate tax cuts that resulted in a reversal of a part of the tax paid at the higher rate in Q1 FY20 — 484 companies on the BSE-500 (ex-telecom) reported a 16 per cent jump in net profit. Sales growth at 1.1 per cent, however, remained weak despite it being a festive quarter. Excluding the tax element, profit before tax rose just 1 per cent for the 484 firms, which account for about 95 per cent of the BSE market value. Brokerages do not rule out de-rating, as management commentaries have not been rosy amid bleak demand outlook. Kotak…

THE SECURITIES and Exchange Board of India (SEBI) has increased the minimum ticket size for investors who want to avail portfolio management services (PMS) to ₹50 lakh from the current ₹25 lakh. It has also changed the networth criteria for portfolio managers to be registered with it to ₹5 crore instead of ₹2 crore. The move will slow down the robust 18 per cent CAGR growth seen by the PMS industry between January 2014 and January 2019 as the pie of potential investors will reduce. But it will also ensure that only high networth individuals who are well-informed, participate in the high-risk product offerings as they can also better evaluate the outcomes of their investment decisions. More importantly, the move will push customers under the ₹50 lakh investment bracket towards…

During the general elections of 2019, and the elections to four state legislative assemblies before it, the Election Commission directed several social media platforms to take down fake content. But the scale of the fake news problem cannot be gauged by the number of cases reported; it is much larger. As per the government, Facebook saw 46 cases of fake news, 97 were on Twitter and 11 on You-Tube. These numbers, however, do not indicate how big the problem is. Verifying what circulates on WhatsApp remains a challenge as well. Now, the India Today Group has partnered with WhatsApp to launch a fact-checking initiative in the country, one that would enable users to verify ‘suspect’ content. WhatsApp users can send any suspect content – text, image, video or URL –…

-27.7% Decline in net profit of 2,398 BSE-listed companies in the first half FY20 On March 30, 1992, the BSE Sensex crossed the 4,000 mark for the first time. It took seven-and-a-half years to move up another 1,000 points past the 5,000 milestone on October 11, 1999. But the journey from 5,000 to 6,000 was a short one, less than four months. When Sensex hit the then all-time high of 6,006 points on February 11, 2000, India was well into the worst-ever economic slowdown. In financial year 2000/01, India’s GDP growth hit a nine-year low of 4 per cent with the January-March quarter witnessing GDP growth of only 1.76 per cent. The farm sector was facing a crisis as production shrunk. In the next fiscal, growth in the manufacturing sector…

OUT OF JOB Unemployment rate (%) is sharply up since June 2017 In the textile town of Bhiwandi, 35 kilometres from Mumbai, dingy, winding, swampy lanes lead to localities humming with noise from power looms. Here, Riten Gada runs Arihant Weaving Mills, a dilapidated two-storied structure with wooden floors and staircases. Gada’s father started the mill 50 years ago. The power loom business did well for the next several decades – the factory’s 16 looms weaved 2.5 lakh metres of fabric a month, directly and indirectly employing 25 people per loom. But with the economic slump, most of Gada’s looms have fallen silent. Less than 10 workers attend to those that are still running. From weaving 2.5 lakh metres of fabric a month, the factory now barely manages 70,000 metres. More…

On November 15, the Ministry of Statistics and Programme Implementation (MoSPI) announced that it will not publish the results of a national household consumer expenditure survey carried out by its wing, the National Statistics Office (NSO), during the period July 2017 to June 2018 on account of “data quality issues”. The MoSPI decision will impact the government’s GDP base year revision plans as the scrapped data set is crucial in revising the base year for calculating India’s economic (GDP) growth. The absence of this data will also deny India an opportunity to understand the changes that have happened in areas of poverty, food consumption, nutrition, malnutrition and a host of other issues during the last six years, as that was when a similar exercise was carried out last to generate…

Do you agree with one of the findings of this research – that most men and women understand what constitutes sexual harassment even though the behaviour persists? When you ask most people about sexual harassment, sexual assault, or issues around consent, they understand on a conceptual level when something is wrong. But they don’t see it so clearly when it’s their own behaviour. On a theoretical level, perpetrators understand what’s wrong, but they have rationalisations for why it doesn’t apply to them. Then what kind of training can help? There isn’t a simple solution. Basic awareness training – making sure people understand what the laws are, what their rights are, and how to access resources if they need them – is important, but it doesn’t necessarily change perpetrators’ behaviour. We…

ADAM NEUMANN, CEO OF WEWORK, the American poster boy of co-working spaces, was forced to quit after the company’s IPO flopped spectacularly. In just one month, the company brought down its valuation from $47 billion to $10 billion, before postponing the issue indefinitely. Investor SoftBank and its Vision Fund collectively wrote down $8.2 billion on WeWork investments, forcing its head, Masayoshi Son, to admit that investing in WeWork was a mistake. The tremors of the WeWork debacle were felt in India too. Some started questioning the feasibility of the boom in co-working spaces that India has been seeing over the last few years. The future of WeWork India, too, became a hotly debated topic. Realising the gravity of the worries, Jitendra Virwani, Chairman and Managing Director of the Bengaluru-based Embassy…

Is Twitter India in trouble again? Going by the latest trend, unhappy users are blaming it for widespread discrimination and leaving the platform to join an open-source microblogging service called Mastodon. Developed by German coder Eugen Rochko, the platform’s tagline says: Social Networking, Back in Your Hands, thus highlighting its decentralised format. This means you are free to create your own community (known as instance), using your own server. Ultimately, these ‘instances’ interact with each other and form the larger network. The network allows people to post text, images, videos and links and also offers four privacy options. Finally, you need to donate a little to keep the platform alive as it does not allow ads or investments. 70% of the Gen Z (between 13 and 22 years) Snapchat users are…

Markets do not have to be logical and rational every day. Throughout history, markets have generally been more irrational than rational. This has happened several times before. For example, in late-1999 to 2000, when the whole industrial economy was hurting, the Sensex made a high of 6,200 in the first quarter of 2000. This happened because technology stocks were driving the market while other companies, including those in auto and cement, were in trouble. More recently, there has been a lot of activity from the government’s side in terms of tax cuts and relief measures, which creates news flow. Markets had been anticipating the tax breaks, which is an example of hope trade. We have to see what more the government has to offer. The third factor in the market…

Mahesh Sharma (42) had worked for Moser Baer India for 17 years and drew a monthly salary of around ₹27,000 when the company was dragged into insolvency proceedings in November 2017. Even before that, all was not hunky-dory as the management declared a lockout at the Greater Noida plant. The workers opposed it vehemently and got the lockout revoked, hoping that operations would start soon. Sharma, who was the President of Moser Baer Karamchari Union, says that workers were ready to give up a part of their salaries for a few months to help revive the company. Of course, people were not working during the insolvency resolution period, but they were hoping that a buyer would ultimately turn up and get the business going. But operations never started, and on…

TWO WEEKS AFTER THE Supreme Court’s judgement on adjusted gross revenues (AGR), which rattled the telecom sector, a Delhi-based top corporate lawyer, whose clients include the likes of Reliance Jio, Bharti Airtel and Vodafone Idea, was travelling to the UK for meetings with foreign lawyers who advise companies on overseas investments. The key takeaway from his meetings was that India is no longer an attractive investment destination in general. “Everybody was asking about the AGR judgement. They couldn’t believe that the liability of a court judgement is so huge that a telco of Vodafone’s size is mulling withdrawing from India,” the lawyer says. Being one of the most litigious sectors, telecom was long seen as the El Dorado for corporate lawyers. But the recent chain of events has shattered…

In his own way, Maruti Chari, 61, is more popular in Usgao, a little village in North Goa, than the local corporator. While the place derives its name from the local word for sugarcane, its major industry and source of employment is iron ore mining. Chari is renowned in the area as the doctor of trucks – he can diagnose any problem in a truck merely by sitting in it and driving for 100 metres. His 41-year-old truck repairing centre on National Highway (NH) 748, which connects Belgaum in North Karnataka to Panjim, is one of the landmarks in the area. But his business took a major hit when the transport business in the area dwindled in the aftermath of a complete ban on mining in Goa in March 2018.…

FOR NEARLY TWO YEARS, real estate lobbies have been praying for a white knight. Residential developers in India need last-mile capital to finish large projects as nearly six lakh units are stuck in various stages in the country’s top cities. On November 6, the Union Cabinet agreed to build a fund whose corpus could add up to ₹25,000 crore. The fund would provide priority debt financing for stalled affordable and middle-income housing projects, raising hope that the residential real estate segment – characterised by lack of trust and confidence in developers due to delivery defaults – could finally see some light at the end of the tunnel. Oversupply of high-end projects added to the woes. But there is another side to India’s real estate coin. Commercial, or office, real estate…

The real estate sector got its most efficient cleansing agent in the form of the Real Estate (Regulation and Development) Act (RERA), 2016, on May 1, 2017. This was expected to be a major step towards decoding the unregulated sector, ensuring transparency and quality and redressing buyer grievances. RERA was introduced to ensure that consumers’ interests are protected and that builders are held responsible. The national regulation provided for tribunals and ombudsmen for redressing disputes. The Act also provided for protection to developers from defaulting buyers and ensured a level of fairness. With proper planning and details of every stage of construction available to buyers, RERA ushered in an era of full disclosure. However, after nearly two-and-a-half years since RERA was implemented, the response has been mixed. Implementation in states…

Ever wondered how Google knows the last time you visited your favourite bakery and then asks you to review it, even when you have not searched for it on any Google service? Does it surprise you when Google suggests the estimated arrival time to your office as soon as you step out of your house? Well, that’s just a small bit of your data that Google has access to. Most of us do not realise that while signing up for various services, apps or even while setting up an Android smartphone, we unknowingly accept most of their conditions, agreements and grant them permission to access our data (who reads the long list of agreement clauses?). If Google’s omnipresence bothers you and you want to take a U-turn, here is a…

MOST WEARABLES are focussed towards tracking activities – steps, calories burnt, workout and sleep. Dipitr’s Strack is a small wearable that helps correct posture. This is a very small device that can be attached to a person’s back; it gives vibration alerts every time that person slouches. Measuring just 47x31x9 mm, the Strack houses an LED indicator with a multi-purpose button at the front. One can wear it using supplied magnets (on the shirt) or adhesive tapes (pasted on the back). Between the two, I found the adhesive tape better. With the magnet, the device slips due to the vibrations. Plus, the vibration feedback is stronger when attached to the back. The adhesive strip is a little difficult to peel off but the company says it is replacing it with…

BENGALURU-BASED WOMEN-focussed brand start-up &Me wanted to build awareness around its herbal drinks which aim to address women’s health issues such as polycystic ovary disease, premenstrual syndrome and urinary tract infection. In March this year, the company started building its content on Instagram and Facebook to share all relevant details of the nutrients essential for women. “We are a women-centric product company and the social media platform helped us reach the right audience to create awareness and build our brand,” says Founder Ankur Goyal. The firm’s posts made people curious and purchase queries rolled in. &Me integrated a ‘Buy now’ tab in its ads which takes users to its website. As a result, its sales have increased 70 per cent since April and there has been a 30 per cent…

1) Founders Hitesh Rathi and Shrey Kumar. Rathi, a civil engineer, worked in the construction space and did a short stint in Myanmar before setting up the company. Kumar, a mechanical engineer from Delhi College of Engineering and an MBA from IBS, joined six months later as a co-founder. 2) The Trigger “As Rathi hails from Rajasthan, India’s traditional camel state, the concept appealed to him,” says Kumar. “Besides, it is not just a local staple. Rathi did extensive research and found that camel milk has several medicinal and health benefits which help the autistic, the diabetic and those suffering from lactose intolerance. He realised that there could be a market out there, although it was largely untapped at the time.” 3) The Secret Sauce Procuring, preserving and transporting are…

The stock market is the barometer of the economy.” This was a statement that examinees had to defend or challenge in an examination during my graduation in Business Economics in 1992. I defended the statement, at a cost. My generation was right in the middle of the biggest ever market mania in India. Robert Shiller recorded it as the eleventh largest ‘Irrational Exuberance’ of any financial mania in human history. Yet, my choice to defend the role of markets as a barometer of the economy arose from a strong belief that markets incentivise those who anticipate better. My professor, a well known and accomplished economist in those days, snarled that John Maynard Keynes had asserted that the “stock market can remain irrational for longer than one can remain liquid”. He…

Biotech drugs are the future. One in every three new drugs approved in the global market is a biotech drug. This, by itself, makes it an obvious space to be in, but for Indian companies, there are other compelling reasons, too. Their traditional stronghold of generic synthetic or small molecule drugs is under siege globally due to low bargaining power, pressure on margins and increased competition, especially in the crucial US market. Biotech drugs can be their next growth engine, especially as drugs with markets worth millions of dollars go off-patent in the next few years, opening immense opportunities for the launch of biosimilar versions of these original biotech drugs. The big Indian pharma players, the prominent among them being biopharmaceutical maker Biocon, are doing exactly that – chasing this…

IN THE FALL of 2017, when the New York Times and other media began reporting on widespread sexual harassment and assault by powerful male entertainment figures, many people were heartened. The conventional wisdom was that bringing the issue to light and punishing those responsible would have a deterrent effect. Leanne Atwater, a management professor at the University of Houston, had a different response. “Most of the reaction to #MeToo was celebratory; it assumed women were really going to benefit,” she says. But she and her research colleagues were sceptical. “We said, ‘We aren’t sure this is going to go as positively as people think – there may be some fallout.’ ” In early 2018, the group began a study to determine whether their fears were founded. They created two surveys…

AFTER HITTING ROCK BOTTOM, residential real estate sales are showing signs of recovery as fence-sitters realise that property prices may not fall further. “Price points cannot go down any more. From a technical as well as market perspective, prices have bottomed out and there is no scope for decline in the near future,” says Siva Krishnan, Head – Residential Services, Developer Solutions and Strategic Consulting, JLL India. One reason is the cost incurred by developers, which has three main components – land, construction and interest. “Today, if you add up these three, without even including inflation and minimal margin for developers, prices are lower than the total. margin for developers, prices are lower than the total. prices,” says Krishnan. According to data from real estate consultancy Liases Foras, property prices…

DO YOU GORGE on spicy foods, stay stuck to your office chair all day long, drink way too much caffeine and never get enough sleep because you bring your work home or love late-night binge-watching on Netflix? Any of these can trigger acidity, gas or heartburn, which we tend to treat with a handful of over-the-counter pills. The instant relief they bring has made them popular, but the problem starts, say doctors, when you self-medicate and take multiple pills a day to treat your symptoms. Of course, you have never connected these medicines to fatal health risks such as cancer, chronic kidney disease or even dementia. However, they have hit the headlines due to potential health risks, making it all the more essential to exercise caution. The US Food and…