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THE MARKETS ON FRIDAY Chg#

SATURDAY, 4 MAY 2019 MUMBAI (CITY) ~10.00
VOLUME VI NUMBER 40 26 pages in 2 sections
Sensex 38963.3 18.2
Nifty 11712.3 12.5 WEEKEND SEPARATE SECTION ECONOMY & PUBLIC AFFAIRS P6
Nifty futures* 11764.3 52.0
Dollar
Euro
~69.2
~77.2
~69.4**
~77.7** PERFORMING ARTS FINDING DANGER OF A FULL-BLOWN NBFC
NEW WAYS TO STAY ALIVE CRISIS HAS PASSED: PURI
Brent crude ($/bbl)## 71.8## 70.7**
Gold (10 gm)### ~31236.0 ~104.0
*(May) Premium on Nifty Spot; **Previous close;
# Over previous close; ## At 9 pm IST;
### Market rate exclusive of VAT; Source: IBJA PUBLISHED SIMULTANEOUSLY FROM AHMEDABAD, BENGALURU, BHUBANESWAR, CHANDIGARH, CHENNAI, HYDERABAD, KOCHI, KOLKATA, LUCKNOW, MUMBAI (ALSO PRINTED IN BHOPAL), NEW DELHI AND PUNE www.business-standard.com

DEFAULTS BY IL&FS
MUST BE DECLARED
NPAs: IRDAI CHIEF
Insurance companies must declare their
exposures to Infrastructure Leasing &
Financial Services (IL&FS) non-performing
assets (NPAs) if the infrastructure-
financing firm defaults on repayment,
said Insurance Regulatory and
Development Authority of India Chairman
Shubash Chandra Khuntia. Hence,
insurance companies have to provide for
bad investments in IL&FS and take a hit on
shareholder profit.
Financial sector may Jaypee Infra lenders
reject Suraksha bid
lose weight in Nifty
NBCC top choice for homebuyers
KARAN CHOUDHURY
Bengaluru, 3 May
NSE considering caps to reduce concentration of any one sector
The wait for the 25,000-odd homebuyers of the
SAMIE MODAK 24.93 per cent, followed by beleaguered Jaypee Group projects is set to RESCUE
6>
Mumbai, 3 May financials at 21 per cent.
Similarly, the FTSE 100 index of
become longer.
According to a BSE filing by Jaypee PLANS

T
he National Stock
Exchange of India
ECONOMY & PUBLIC AFFAIRS P6 (NSE) is considering
REC's higher offer capping
weights in the benchmark
sectoral
stirs up bond market Nifty50 index, a move that
Bond market participants were baffled by could trigger a sell-off in finan-
an unusual deal done by government-
backed REC Ltd, which raised ~1,247 crore
cial stocks. The proposal is
aimed at providing more diver-
from the market for bonds maturing in two
years, seven months and 15 days.
sity and reducing the concen-
tration of one sector.
The AAA-rated public infrastructure finance The Nifty, considered a
company offered 8.5 per cent for the
money. ANUP ROY & SHREYA JAI write
barometer of the Indian econo-
my, has the representation of 13
sectors through 50 stocks.
However, financials, which
include banks and non-banking
ON financial companies (NBFCs),
SPECIALS
SATURDAY alone account for over 37 per
cent of the index weight, exert-
ing a disproportionately high
WEEKENDRUMINATIONS: influence on the market. In oth-
Coldshowerafterthepolls 9> er words, the fortune of the stock
market is tied closely to the per-
The danger is that a post-poll
government might be tempted to take formance of financial stocks.
Experts say most popular
comfort from moderate inflation and opt
for expansionist policies in order to global indices don’t have a sec-
deliver on unaffordable poll promises, toral cap, but the weight of the
writes T N NINAN top sector in markets like the
US, Japan and the UK is little
NATIONALINTEREST: Modi compared to India. Also, sector
meetshismatchinMamata 9>
weights in the developed world
Modi & Shah are street-fighters trying to are more in sync with the real
win Bengal through Hindu-Muslim economy. For instance, in the
polarisation. But Mamata is fighting Dow Jones Industrial Average,
their poison with her own. an index of 30 large US-listed
SHEKHAR GUPTA writes companies, the technology sec-
tor has the highest weight at
YES,BUT...: Celebritycouples
sparkleforbrands 9>
The era of the Celebrity Couple is finally
here, writes SANDEEP GOYAL, in the
first of a fortnightly column for CYCLONE FANI BATTERS EAST COAST
Business Standard
the London Stock Exchange
has technology as the biggest
sector with 19.6 per cent weight,
followed by consumer durables
and real estate at around 15 per
cent each. Japan’s Nikkei 225
has communications and tech-
nology as the two biggest sec-
tors with weights of 31 per cent
and 28 per cent, respectively.
“The weight of financial
services is at odds with the sec-
tor’s weight in the economy. It
simply doesn’t have that kind
of share in our GDP,” said
Saurabh Mukherjea, founder
and chief investment officer at
Marcellus Investment Man-
agers, calling for more realign-
ment between market perform-
ance and economic growth. The
NSE has sought market feed-
back on whether it should go
ahead with the proposal to have
a threshold on sectoral weights.
Based on the response, the
exchange could cap a sector’s
weight at 25 per cent, or align
with the broader market. The
share of financial companies in
the overall listed universe is
31.88 per cent — high but still
below its Nifty weight.
In a discussion paper, the
NSE has said sectoral caps
would lead to diversification but
has also listed several negative
aspects. Turn to Page 10 >
Infratech, the offer of the Suraksha Realty-led
consortium, the only player left in the race to
acquire Jaypee Infratech, has been rejected by
the Committee of Creditors (CoC) after it was
not able to get the 66 per cent votes required to
get the go-ahead.
SURAKSHA REALTY’S OFFER*
According to the filing, only 23.47 per cent of ~18.55 cr as upfront
RESTORING BALANCE the votes were in favour of Suraksha while 41.85
per cent were against giving Jaypee Infratech
payment to lenders
With 37%weightin Nifty50, financial stocks have
disproportionatelyhigh influence on the market
projects to them. The rest abstained from vot-
ing. Almost none of the banks voted in favour
~5,000 cr worth of land
parcels
Nifty Overall Sector weight (%) of Suraksha’s plans, a closer look at the Jaypee
Current Decade ago
filing shows.
“Since the members representing 23.47 per
~3,000 cr capital
infusion to complete the
37.36 21.87 cent of the voting rights assented to the matter,
FINANCIALS the decision on the item stands rejected,” the
construction of over
31.88 20.72 20,000 flats
papers on Voting Results for the Ninth Meeting
ENERGY
14.59
11.77
24.78
19.13
of the Committee of Creditors (CoC) of Jaypee
OTHER OFFERS
IT
14.14 10.51
Infratech Ltd submitted in the BSE stated.
Voting on the issue started on April 30 for NBCC
10.92 8.83 banks and financial institutions as well as | ~5,000 crore worth of
CONSUMER 11.54 8.91 homebuyers and fixed-deposit holders. The land
process ended on May 3.
GOODS 13.31 9.23 | 100 per cent equity of
According to sources close to the matter, in
6.9 3.88 Yamuna Expressway, the
AUTOMOBILE the worst-case scenario if the insolvency reso-
7.1 4.67 lution professional (IRP) does not come up with
only cash generating
asset with Jaypee Infra
Note: Overall is representation in all NSE-listed stocks Source: NSE any plan, Jaypee Infratech might head for liq-
uidation. If that happens homebuyers are in | Promise of giving house
| NSE, which has sought market feedback, the danger of not getting their apartments. keys in three years
could cap a sector’s weight at 25 per cent, or However, sources close to the CoC are cer- Jaypee Group
tain that Jaypee Infratech projects will now
align it with the broader market | Chairman Manoj Gaur has
head for a third round of bidding. This would
| Plan is aimed at providing more diversity and allow not only state-run NBCC to participate in promised to infuse
bidding but also give a chance to the promoters ~2,000 crore to complete
bringing sector weights in sync with real economy
of Jaypee Group as well as Adani Group to pending apartments over
| Experts say the weight of financial services is throw their hat in the ring to grab the project, the next four years
at odds with the sector’s weight in the economy worth over ~8,000 crore. *Offer rejected on Friday
Turn to Page 10 >
N EARNINGS CENTRAL N

HULvolume Cognizantprojects
PAGE 16
POLITICS & PUBLIC AFFAIRS growthlowest slowestgrowth
Cong leaders to take insixquarters initshistory
general coaches to spread
NYAY message Thecountry’slargestconsumergoods US-basedinformationtechnology(IT)
Up to phase VI, number of company,HindustanUnilever(HUL), servicesfirmCognizantslasheditsfull-
women in fray crosses 600 reporteditslowestvolumegrowthinsix yearrevenueguidancefor2019byalmost
POLL quartersfortheJanuary-March2019 halfonFriday.ThisistheITfirm’sslowest
VAULT TMC digs deep, doesn’t
2019 periodasruraldemandmoderated.Forthe growthprojectionever.Thiswasdueto
rule out queen’s chair quarterunderreview,HULsaw7percent executionissuesandslowgrowthinitskey
volumegrowth,asagainst11percentinthe verticals—financialservicesandhealthcare.
year-agoperiod.Intheperiodbetween TheTeaneck-headquarteredfirm,which
COMPANIES P3 December31,2017andDecember31,2018, misseditsrevenueguidanceforthefirst
Big Four can’t offer legal HULreportedvolumegrowthintheregion
of10-12percent. 2>
quarter(January-March),saiditwould
considervariouscostoptimisation
services: Bar Council measures,includingadditionalemployee
In a double-whammy for the Big Four “FACTORS SUCH AS A STABLE separationprogrammes,aspartofits
audit-cum-consultancy firms — Deloitte,
EY, KPMG and PwC — the Bar Council of Delhi
GOVERNMENT AND A GOOD realignmentefforts.Thefirm'sfinancial
yearisfromJanuarytoDecember.Accor-
has directed the four firms to refrain from MONSOON WILL PLAYA dingtotherevisedguidance,Cognizantis
providing legal services to clients till further KEY ROLE, BUT I REMAIN likelytoclockfull-yearrevenuegrowthin
notice. The Society of Indian Law Firm said in
its complaint that the Big Four were actually
OPTIMISTIC therangeof3.6-5.1percentfor2019,as
againstitsearlierguidanceof7-9percentin
accounting firms, but were engaged in ABOUT THE constantcurrencyterms. 2>
“doing law practice”. FUTURE”
SANJIV
MEHTA
Q1 REPORT CARD
> SENSEX YoY QoQ
THIS WEEK A view of the destruction caused by Cyclone Fani in Puri, Odisha, on Friday PHOTO: PTI
Chairman & MD,
HUL Parameter growth growth
Landfall Magnitude Victims Damage Flights MARKETS P10 Revenue $4.11 bn 5.1% -0.5%
39,200 Fani,orthe Thestrongesttropical Eightpeople Roadandpower Operationsat > THE COMPASS: HUL investors need to cool Net profit $441 mn -15% -32%
39,067 39,100 hoodofsnake, cyclonetohitIndiain20 killedin infrastructure Bhubaneshwarand
39,000 madelandfall years.Itunleashedheavy separate severelyhitin Kolkataairportsremained
expectations after weak Q4 show Operating
COMPANIES P2 16% -170* -350*
38,900 around8am rainandwindstorm incidentsin severaldistricts; suspendedformanyhours; margin
38,963 38,800 inPuri gustingupto200kmph Odisha Purisufferedworst likelytoresumetoday > GODREJ CONSUMER PBT FALLS 32% *Basis points Note: Cognizant follows Jan-Dec financial calendar
38,700
Apr26 2019 May3

Godrej Properties buys a piece of film history: RK Studios

Net change -104 % change -0.3

> RESULTS RECKONER

Swankyflats,malltoreplacetheiconicproperty Thesaleofthestudiohasbeenclosely
trackedeversincetheannouncement
Quarter ended Mar 31, 2019; common sample
of 205 companies (results available of 230)
inMumbai‘seasternsuburbofChembur madebyactorRishiKapoorinAugust
2018thatthefamilyhaddecidedtoput
SALES thepropertyontheblock.UnderGodrej,
RAGHAVENDRA KAMATH Friday. Prices in high-end buildings thestudiowillmakewayforswanky
Mar 31, ’18 18.0% 4.31 trillion Mumbai, 3 May around the RK Studios area are around residentialtowersandaluxurymall.
Mar 31, ’19 15.8% 4.99 trillion ~25,000 a sq ft in terms of carpet area, Notonlyisthedealbeingseenasthe
Raj Kapoor’s RK Studios in Chembur, say real estate brokers. endofaneraforBollywood,andasoneof
NET PROFIT
an eastern suburb of Mumbai, has PirojshaGodrej,executivechairman, thelargestblocksofrealestatetogo
Mar 31, ’18 9.6% 45,693 crore slipped into history. The 2.2-acre iconic GodrejProperties,said,“Thisfitswell underthehammerintheeastern
Mar 31, ’19 22.9% 56,162 crore landmark has been sold to Godrej withourstrategyofdeepeningour suburbsofthecity,itisexpectedto
Companies that have reported zero sales are excluded
Properties, the Godrej group’s real presenceinkeylocationsacrossIndia's transformthelocallandscapeand
Data compiled by BS Research Bureau Source: Capitaline estate company. Although neither leadingcities.Wewillseektoensurewe influencepropertypricesinthearea.
party is willing to put a figure to the celebratetheremarkablelegacyofthis Forpeopleinthearea,thestudiohas
deal, the industry estimate is that the sitewiththegoalofdeliveringan beensynonymouswiththestate’s
TO OUR READERS plot went under the hammer for close outstandinglifestyleforitsresidents.” annualGanapatifestivalandtheraucous
The half-page commercial feature to ~200 crore. Setupin1950,thestudioisan Holipartiesthatdrewthewho’swhoof Set up in 1950, the studio is an indelible part of Bollywood lore and local history. A
on Bimtech, being carried on page 5, The plot is located on the Sion- indeliblepartofBollywoodloreandlocal theindustryintoitsimposingirongates number of superhits like Awara, Bobby, and Ram Teri Ganga Maili were shot here
is equivalent to a paid-for Panvel highway, an arterial road that history.Someofthebrighteststarsfrom thatwalledoffgawkingpassers-byfrom
advertisement. No Business Standard connects the southern tip of the city theHindifilmindustryhavepassed thestarsinside.Thestudio’sdecline Thefinalstrawwasafirein Indianfilmindustry,withRanbirKapoor
journalist was involved in producing with many townships of Navi Mumbai. throughitshallowedgatesandithas begansoonafterthedeathofthe September2017thatguttedlargepartsof andKareenaKapoorbeingthelatest
it. Readers are advised to treat it as an Of the total area, about 33,000 sq metre rolledoutsomeoftheindustry’sbiggest patriarchKapoorandasstudiosinthe thestudioandburntdownprecious generationofactorsinplay,saythey
advertisement. (around 350,000 sq ft) of saleable area hits.FromAwaratoBobbyandRamTeri Westernsuburbsofthecitygrewmore memorabilia.TheKapoors,widely founditdifficulttomaintaintheplace.
can be built, Godrej Properties said on GangaMaili,allwereshothere. popular,itlostitssheen. acknowledgedasthefirstfamilyofthe Turn to Page 10 >

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2 COMPANIES
>
MUMBAI | 4 MAY 2019 1

IN BRIEF
Vodafone Idea, IBM sign Now, farmers seek damages from PepsiCo
multi-million dollar IT deal Unions say farmers’ ‘right to seeds’ is non-negotiable
India's largest telecom operator
Vodafone Idea on Friday announced a VINAY UMARJI PepsiCo had on Thursday said it had for pressuring PepsiCo to agree to their
five-year multi-million dollar IT Ahmedabad, 3 May agreed to withdraw cases against potato demands for compensation. “We are not
outsourcing deal with tech giant IBM. growers in Gujarat after discussions with the going to approach the courts for compen-
“...this engagement will also eeking an unconditional withdrawal government. The company had sued nine sation but will take a call as and when
contribute to Vodafone Idea's merger
synergy objectives by reducing its IT
related costs,” the telecom firm said in
S of the case, the potato growers in
Gujarat, who were sued by PepsiCo
India Holdings, said on Friday that they
potato farmers in Gujarat, including five last
year and four this year, for allegedly buying
seeds and selling potato of the FL 2027 vari-
PepsiCo files for withdrawal of cases in the
courts,” the farmers said.
On Friday, farmers and activists also
a statement. The company did not have sought compensation from the cola ety registered by PepsiCo. This variety is used announced forming of a new outfit called Bij
divulge the size of the deal but some reports pegged it at about $700 and food giant for the harassment caused by PepsiCo for making ‘Lays’ chips. Adhikar Manch (Rights for Seeds Forum). A
million. “The collaboration will provide Vodafone Idea with a to them due to the lawsuit. “After discussions with the govern- meeting of 30 members under the new enti-
hybrid cloud based digital platform to enable more intimate In a press briefing on Friday, three of the ment, the company has agreed to with- ty, comprising farmers, farm leaders, civil
engagement with its over 387 million subscribers (as of December 31, potato farmers sued by PepsiCo along with draw cases against farmers. We are relying rights representatives, lawyers and scien-
2018), enhancing business efficiency, agility and scale plus farmer union leaders and farmers’ rights on the discussions to find a long-term and tists, was also held in Ahmedabad on Friday
simplification of its business processes,” it said. The new activists asserted that Indian farmers’ 'right amicable resolution of all issues around where the forum decided to call for a nation-
infrastructure platform will remove constraints to exponential to seeds' was non-negotiable. seed protection. The company remains wide boycott of PepsiCo products.
growth of data usage driven by increasing consumption of video, With support from other farmer deeply committed to the thousands of The forum will now continue to fight for
streaming and digital commerce, the statement said, adding that it organisations and activists, including the farmers we work with across the country farmers’ sovereign rights seeds, said its co-
will also drive enhanced customer experience to millions of RSS-affiliate Bharatiya Kisan Sangh and towards ensuring adoption of best ordinator Kapil Shah.
connected consumers and businesses in India. PTI< (BKS), the potato growers have not only farming practices,” a PepsiCo India Friday also saw PepsiCo India officials
sought compensation but also called for spokesperson had stated. hold a meeting with Gujarat government
boycott of the food giant’s products. The sued potato farmers also called officials, including chief secretary of the
“PepsiCo should withdraw the cases for more awareness of the legislation state and additional chief secretary for agri-
RBI slaps ~11-lakh RBI slaps penalty unconditionally. The company has to also around plant varieties among farmers culture, in state capital Gandhinagar.
fine on YES Bank for on PhonePe, Voda pay us compensation for all the harass- across the country. Addressing mediapersons after the
violating norms m-pesa, 3 others ment we were put through even though
the law is clear on the subject,” said Bipin
“The court proceedings came as a shock
to us, including the amount of damages
meeting in Gandhinagar, Jagrut Kotecha,
vice-president snacks, PepsiCo India, said,
YES Bank on Friday said the The Reserve Bank of India Patel, one of the four potato growers that the company was claiming. It was “We had come to update the state govern-
Reserve Bank of India has Friday said it has imposed against whom PepsiCo had filed a suit, in clearly trying to intimidate and harass us. ment about the statement we had issued
imposed a penalty of ~11.25 penalties on five prepaid KEY POINTERS a media briefing on Friday. Its real intention may have been to wipe earlier on Thursday and are looking forward
lakh on it for violating money payment instrument (PPI) “We would like the state government out competitors from the market, but it to an amicable solution for everyone.”
> Potato growers seek rights on seeds
transfer norms. "(The) Reserve issuers, including Vodafone to reveal full details of the ongoing discus- chose to harass farmers,” they said. When asked about withdrawal of cases
Bank of India (RBI) vide its m-pesa and PhonePe, for unconditional withdrawal > PepsiCo had earlier sions with the company since we are On the other hand, Maganbhai Patel of against the potato growers, Kotecha told
speaking order dates April 22, violation of regulatory norms. of case with compensation offered an out-of-court demanding an unconditional withdrawal BKS said that it was possible to get a large mediapersons that PepsiCo India would
2019, imposed a penalty of Also, penalties have been > Seek details of govt’s settlement based on a reiteration of Section 39 (1) (iv) multinational company to back out very withdraw the cases as and when the mat-
~11,25,000 under the Payment imposed on Western Union discussions with PepsiCo of the Protection of Plant Varieties and quickly, given that the PPV&FR Act 2001 ter came up for hearing before the court.
> Food major works with
and Settlement Systems Act, Financial Services Inc and Farmers’ Rights (PPV&FR) Act 2001, and was clearly on the farmers’ side. The next hearing in the matter has been
> Invoke Section 39 of around 1,200 potato
2007," YES Bank said in a MoneyGram Payment Systems anything else is not acceptable,” the pota- The potato growers and farmer activists scheduled for June 12 at a commercial
regulatory filing. PTI< Inc, both US firms, for non- PPV&FR Act for asserting farmers in Gujarat to growers said. also sought support from the government court in Ahmedabad.
compliance of guidelines. PTI<

Embassy Office
Parks to raise ~3K cr SpiceJet to add NEARNINGS CENTREN
via debentures 12 more flights
from May 11
HUL volume growth declines
Embassy Office Parks, which
recently launched India's first
real estate investment trust
(REIT), Friday said it will raise
~3,000 crore through the
allotment of debentures on a
private placement basis. Emba-
ssy Office Parks, a joint venture
as rural show disappoints
between global investment firm
Blackstone and realty firm
SpiceJet has announced
introduction of 12 new flights
Revenue, net profit company was in terms of oper-
ating profit, or earnings before
Embassy Group, had raised from New Delhi and Mumbai to miss analysts’ interest, tax, depreciation, and
~4,750 crore through REIT. PTI< other destinations. Of the 12 amortisation, which rose 13.2
new services, which comm- estimates even as per cent in Q4FY19 over

L&T Technology
ence from May 11, six are to and margins improve Q4FY18 to ~2,314 crore. This

Services Q4 net
profit up 21%
L&T Technology Services (LTTS) on
Friday posted about 21 per cent
rise in consolidated net profit to
~191.5 crore for the fourth
quarter of 2018-19, helped by
broad-based growth across
industry segments. The comp-
any's revenue from operations
stood at ~1,343.1 crore, up 27 per
cent year-on-year and two per
cent on a sequential basis. "We
had an excellent year, growing
ahead of the industry once
again. Growth in the financial
year 2018-19 was broad-based
and we achieved our target of
double-digit growth in all five
of our industry segments," LTTS
CEO and MD Keshab Panda said.
PTI<
NDMC may charge
Hotel Lalit ~8 cr per
month licence fees
Hotel Lalit in Central Delhi will
soon have to cough up around
~8 crore a month as license
fees to the NDMC as the civic
body is planning to revise the
charges. The revision of the
license fees has been long due
for the hotel. The New Delhi
Municipal Council (NDMC) is
supposed to renew the licence
fee every 33 years as per the
licence deed, which is for 99
years. However, the 33-year
period for Lalit Hotel had
expired in 2014. The five-star
hotel currently pays ~12 lakh
per month as license fees to
the civic body. PTI<
from Mumbai while the rest
connects the national Capital,
SpiceJet said in a statement.
The airline will deploy Boeing
737 NG aircraft on these routes,
it said, adding the new services
from Mumbai will be operated
from Terminal 2. PTI<
Birla Corp’s Q4
net profit at
~128.19 crore
Birla Corporation’s net profit
during the quarter ended
March 31, 2019 fell by 2.23 per
cent at ~128.19 crore as against
the net profit of ~131.12 crore
registered in the similar quarter
of the last fiscal year. Its net
revenue, on the other hand
grew by 13.44 per cent at
~1,872.76 crore as compared to
the earning of ~1,650.81 crore
on a year-on-year basis.
BS REPORTER<
Cement firms
under scanner for
over-loading
Truck over-loaded with
cement bags would now land
even the manufacturer of the
product into trouble in
Chhattisgarh. The state
government had taken a
decision to lodge FIR with the
police against cement com-
pany if vehicle ferrying its
product was intercepted with
over load. The company would
also face legal action for dam-
aging state’s resources as over-
loaded trucks would damage
the roads. BS REPORTER<
VIVEAT SUSAN PINTO
Mumbai, 3 May
Hindustan Unilever (HUL), the
country’s largest consumer
goods company, reported its
lowest volume growth in six
quarters for the January-
March period (Q4), on the back
of moderation in rural
demand.
For the quarter under
review, HUL saw 7 per cent vol-
ume growth against 11 per cent
in the year-ago period. From
the December 2017 quarter to
December 2018 quarter
(Q3FY18 to Q3FY19), HUL
reported volume growth in the
region of 10-12 per cent, after
gaining from price cuts under
the goods and services tax
regime, coupled with con-
sumer uptick in urban and
rural areas.
On Friday, Chairman and
Managing Director Sanjiv
Mehta said that rural growth,
which was earlier 1.3 times
urban growth, was now in line
with urban growth, indicating
slowdown in rural areas.
Market research agency
Nielsen had last month hinted
at the same, stating that the
‘Liquidity crunch, low food inflation
contributed to rural slowdown’
Hindustan Unilever (HUL) navigated a challenging March quarter as the
sector witnessed a slowdown. In a press conference, Chairman and
Managing Director SANJIV MEHTA responded to questions from
Viveat Susan Pinto on what lies ahead for the company. Excerpts:
was in line with the consensus
estimate of ~2,348 crore.
Operating margin expanded
Cognizant projects
slowest growth ever
90 basis points to 23.3 per cent
in Q4. A basis point is one-hun-
dredth of a percentage point.
HUL also declared final
dividend of ~13 per share on GIREESH BABU & “Cognizant’s growth and
Friday. When added to the DEBASIS MOHAPATRA performance in the quarter
KEY FINANCIALS interim dividend of ~9 per
share announced earlier, the
Chennai/Bengaluru, 3 May leaves room for improvement,”
said Chief Executive Officer
Reported
Quarter Net sales YOY Chg Profit After YOY Chg
total dividend stands at ~22 per
share for FY19. This is 10 per
US-based information tech-
nology (IT) services firm
Brian Humphries adding:
“While I am encouraged by our
(~ cr) (%) Tax (~ cr) (%) cent higher that the total divi- Cognizant slashed its full- client centricity, our employ-
Dec-17 8,323 10.8 1,326 27.7 dend of ~20 per share given in year revenue guidance for ees’ winning spirit and our
FY18, said Chief Financial 2019 by almost half on Friday. innovation, we are not yet
Mar-18 9,003 11.1 1,351 14.2
Officer Srinivas Phatak. This is the IT firm’s slowest delivering against the market
Jun-18 9,356 11.4 1,529 19.2 Shares of HUL fell more growth projection ever. This opportunity. We are commit-
Sep-18 9,138 11.5 1,525 19.5 than 2 per cent on Friday to was due to execution issues ted to strengthening our exe-
close at ~1,692.80 apiece on the and slow growth in its key cution to invest in growth.”
Dec-18 9,357 12.4 1,444 8.9 BSE, before the earnings verticals — financial services The firm’s operating mar-
Mar-19 9,809 9.0 1,538 13.8 announcement, which came and health care. gin dropped 350 basis points to
Source: Capitaline Compiled by BS Research Bureau after market hours. On the seg- The New Jersey-headquar- 16 per cent in Q1 of 2019. Based
ment front, revenue from the tered firm, which missed its on current foreign exchange
fast moving consumer goods HUL’s net profit rose 13.8 home care business rose 12.9 revenue guidance for the first rates, the company expects its
(FMCG) market grew 13.6 per per cent year-on-year (YoY) to per cent to ~3,502 crore. quarter (January-March), said second quarter and full-year
cent in Q4, versus 15.9 per cent ~1,538 crore in Q4, lower than Revenue from the beauty and it would consider various cost 2019 revenue growth to be neg-
and 16.5 per cent in the
December and September
the Bloomberg consensus esti-
mate of ~1,611 crore. Revenue
personal care segment grew 7.3
per cent to ~4,393 crore.
optimisation measures, incl-
uding additional employee sep-
atively affected by 130 basis
points and 90 basis points,
quarters, respectively. (net sales plus other operating Revenue for the food and aration programmes, as part of respectively, translating to
While Mehta said that the
FMCG market would bounce
income) rose 9.3 per cent YoY
to ~9,945 crore, marginally low-
refreshment segment rose 10.4
per cent to ~1,916 crore.
its realignment efforts. The
company follows a January-
growth of 2.6-3.6 per cent ($4.11-
$4.15 billion) for the quarter and
back in the near term, Nielsen er than the Street’s estimates of Kaustubh Pawaskar, rese- December financial calendar. 2.7-4.2 per cent ($16.55-$16.80
lowered its forecast for CY19, ~10,001 crore. Net sales, mean- arch analyst at Sharekhan, said: According to the revised billion) for this year.
saying growth would be while, grew 9 per cent YoY to “Weakening demand in the guidance, Cognizant is likely to “Over the coming quarters,
around 12 per cent as against ~9,809 crore. rural market will impact per- clock full-year revenue growth we intend to bring our cost
14 per cent in CY18. The only respite for the formance in the near term. in the range of 3.6-5.1 per cent structure closer in line with our
for 2019, as against its earlier revised revenue expectations,”
guidance of 7-9 per cent in con- said Karen McLoughlin, chief
stant currency terms.
Infosys guided for a revenue
growth rate of 7.5-9.5 per cent
for this financial year, while the
financial officer of Cognizant.
The IT services firm, which
has a majority of its employees
in India, incurred $2 million in
TCS management was confi-
dent of achieving double-digit
revenue growth during this
costs associated with the CEO
transition, apart from the
departure of its president in Q1.
period. In the first quarter of It is likely to incur another
this year, Cognizant posted 15 $23 million during the rest of
per cent decline in net profit to 2019. Owing to the Supreme
$441 million, compared to $520 Court's order, the IT firm is also

Bharti Airtel plans to kick off How long do you see the demand. Rural growth is
million in the year-ago period.
Revenue stood at $4.11 bil-
expecting additional liability
arising out of defined contri-
slowdown lasting? Nielsen now in line with urban lion in Q4, a rise of 5.1 per cent bution obligations towards
IPO of $5-bn Africa phone unit has given a lower forecast growth, which wasn’t the on a year-on-year (YoY) basis. employees this year.
for CY19 versus CY18. What case earlier. Rural growth In constant currency terms, rev-
BLOOMBERG being boosted by emerging- are your thoughts on this? was 1.3 times that of urban enue growth was 6.8 per cent. More on business-standard.com
London/Mumbai, 3 May market companies seeking a I see the market bouncing growth, a few quarters ago.
wider investor pool. Finablr, back in the near term. Yes, But factors such as
Bharti Airtel, India’s second- the currency-exchange firm
biggest wireless carrier, is controlled by an Abu Dhabi-
factors such as a stable
government at the Centre
liquidity crunch and food
inflation being on the lower
Godrej Consumer PBT falls 32%
preparing to kick off the initial based billionaire, starting and a good monsoon will be side (which has impacted PHOTO:KAMLESH PEDNEKAR FMCG major Godrej Consumer Products (GCPL) reported a 32 per
public offering of its Africa unit taking orders this week for a key, but I remain optimistic. farm income), have cent decline in its consolidated profit before tax from ~737.59
in a deal that could raise about share sale that could raise as The market has a seen a contributed to the slowdown we will have to wait. improvement in operating crore in March 2018 quarter to ~500.57 crore in the fourth quar-
$1 billion, people familiar with much as $677 million. West reversal after a few quarters in rural areas. Wages have margins in the Q4? What ter of 2018-19. It reported a 51.5 per cent increase in conso-
the matter said. Asian payments of robust growth, but I am not also not grown significantly, Will price growth return to strategy do you have in place lidated net profit to ~935.24 crore in the fourth quarter ended
Airtel Africa is Airtel Africa is processor Network giving up. The new impacting consumer the market or will you cont- to improve margins? March 2019, but that was largely due to write-back of tax credit
planning to make a planning to International government that confidence. Having inue to depend on volume There is no big differentiator. on account of minimum alternative tax. Adjusted for the tax
formal announce- make a formal Holdings Plc comes to power will said that, I believe the growth, which is now slo- What we are focusing on is adjustments, which include other deferred tax treatment, the
ment about the announcement raised £1.1 billion make an effort to kick- tide will turn. FMCG wing? our product mix. We are net profit declined by 35.7 per cent year-on-year to ~500.57
London listing this about the ($1.4 billion) last start the economy. This growth rates have not Price growth happens when managing our costs crore. Total revenue from operations during the quarter fell
month and aims to London listing month in the should improve vanished. So, there is there are reasons such as efficiently and looking to 3.06 per cent to ~2,481.72 crore, compared with ~2,560.14 crore
start trading in June, this month and largest London sentiment and demand. no panic situation here. input cost pressures rising, or drive savings. We will in the corresponding quarter of the previous fiscal.
the people said, ask- aims to start IPO this year. when you put a compelling continue to look at 7 per cent GCPL executive chairperson Nisaba Godrej said, “We
ing not to be identi- trading in June Valuation and Apart from rural areas, What kind of an impact do proposition in terms of a of cost savings as an engine delivered a relatively weak performance in the fourth quarter of
fied because the the listing date are where else is there a you see on your business, product in the marketplace. for margin improvement fiscal year 2019. Our India business remained soft on account of a
matter is private. It’s consider- still under discussion, and slowdown? with India witnessing an Today, we are happy with and growth. general slowdown in staples consumption and the adverse
ing seeking an equity valuation final details could change In terms of distribution extremely severe cyclonic where the price-led growth In fact, the operating impact of the delayed summer on our portfolio.” During the
of about $5 billion, they said. depending on investor channels, general trade and storm in the east? is, and will work on pricing as margin of 23 per cent (in Q4) is quarter, GCPL’s India sales were marginally down 0.9 per cent to
The IPO could be one of demand and market senti- wholesale have slowed down There will be an impact, but and when the situation the highest-ever for us. We ~1,356.09 crore, while its international business sales grew 10
the biggest in London this ment, the people said. A rep- in the March quarter. it is difficult to make an demands. also delivered margin per cent on a constant currency basis, said GCPL in a statement.
year. The exchange’s lacklus- resentative for Bharti Airtel However, this is linked to the assessment right now. expansion in 30 out of 31 Its revenue from the Indonesian business was up 19.34 per cent
ter domestic volumes are declined to comment. moderation in rural Odisha is a huge market but What explains the 90 bps quarters, which is significant. while Africa business grew of 13.15 per cent. BS REPORTER & PTI

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.
MUMBAI | 4 MAY 2019 COMPANIES 3 <

Bar Council asks 5G deployment

will be critical
for operators,
Big 4 not to offer says Ericsson
The troubled telecom sector

legal services
in India would need to turn to
5G deployments to reduce
cost and improve perform-
ance, said Swedish telecom
equipment provider Ericsson
on Friday. Ericsson has
SUDIPTO DEY announced 18 commercial 5G
New Delhi, 3 May dealsgloballyandispartofthe
first wave of live 5G networks

I
n a double-whammy of
sorts for the Big Four
audit-cum-consultancy
firms — Deloitte, EY, KPMG
and PwC — the Bar Council
of Delhi has directed the com-
panies to refrain from provid-
ing legal services to clients till
further notice.
This follows a complaint
filed by the Society of Indian
Law Firms (SILF), representing
around 100 Indian law firms.
SILF said in its complaint that
the Big Four were actually
accounting firms, but are
engaged in “doing law practice”.
It had filed a similar complaint
to the Bar Council in 2015, alleg-
ing that the Big Four were
resorting to “unauthorised
practice of law” in violation of
the Advocates Act.
The Bar Council order asked
the four firms to provide a list of
advocates on their rolls. The
order copy said while Deloitte
and KPMG filed their response
to the complaint, PwC and EY
asked for more time to submit
response. The Council has
deferred the matter for further
hearing to July 12. It asked the
four firms to refrain from the
practice until further orders.
This has come at a time
when the Big Four firms are
under scanner for audit-relat-
ed practices. The recent melt-
down at the Infrastructure
Leasing & Financial Services
(IL&FS) group has put the spot-
light on statutory auditors.
Many in the chartered
accountantfraternitywereofthe
view that there were grey areas
over jurisdiction of non-litiga-
tion related legal services. In
theirearlierresponsein2015,one
of the Big Four said that it was
not “engaged in the practice of
law”. A source in one of the four
firms reiterated the same stand.
acrosstheUS,EuropeandAsia.
“The important aspect is
that its is critical for our cus-
tomers (operators) to move to
5G than for the end sub-
scribers. 5G will drive down
the cost per gigabit and by
deploying it they can deploy
much higher capacity at a
much lower cost to cater to
the rapidly growing demand
and smoother user experi-
ence,” said Ludvig Landgren,
head of network applications
and cloud infrastructure,
Ericsson South East Asia,
Oceania & India.
Ericsson also announced
that it has been selected by
Vodafone Idea to deploy its
Cloud Packet Core to enhance
its existing core network.
ROMITA MAJUMDAR

Used car market to reach 7 mn units by 2022: Report

SHALLY SETH MOHILE
Mumbai, 3 May
Demand for pre-owned cars
remainedstronginthefinancial
year2018-19(FY19),crossingthe
4-million unit mark, even as
salesofnewcarswereintheslow
lane, according to a report.
The used cars segment is
expected reach 6.7 to 7.2 million
cars per year and be valued at
~50,000 crore by FY22, accord-
ingtoIndianBlueBook,thepric-
ing and valuation arm of
Mahindra FirstChoice Wheels
(MFCW), the pre-owned unit of
CRUISE CONTROL
> Used car and associated
industry to touch ~50k cr
in value terms by FY22
> Over 75% pre-owned
buyers prefer sedans
and hatchbacks
Mahindra and Mahindra.
The used car market is now
1.2 times the size of the new car
market, according to the third
edition of the report on
IndianBlue Book.
Passenger vehicle (PV) sales
in India advanced by a mere 2.7
per cent to 3.3 million units in
FY19 — the slowest in five years
as buyers deferred purchase
amid high finance costs and
uncertainty.Encouraged by the
growth prospect in the used car
space, MFCW envisages selling
350,000 PVs in FY20, against
250,000 units in FY19.
It is also hoping to become a
profitable company by the end
of FY20 on the back of volume
growth,AshutoshPandey,man-
aging director and chief execu-
tive officer officer at MFCW, told
Business Standard.
To tap into the growth
opportunity,thecompanyplans
to step up the number of deal-
ershipsfromthecurrent1,100to
1,700 by FY20-end. “What
drives the used car market is the
migration up from the two-
wheelers,” said Pandey.
The pool of people willing to
migrate from a two-wheeler is
significantly large, he said,
pointing out that the trend is
being fuelled by the second-
hand market getting increas-
ingly organised.

Govt may allot Jet’s traffic rights to others

ANEESH PHADNIS
Mumbai, 3 May
Domestic airlines have sought
the government’s nod to start
flights to Dubai, Singapore and
other destinations using traffic
rights held by Jet Airways. The
civil aviation ministry is con-
sidering the request and has
asked the airlines for their
requirement and capacity
deployment plans.
JetAirwayssuspendedoper-
ations on April 17. The airline
had daily flights to Europe,
South East Asia and West Asia
and the grounding has resulted
in reduction of capacity and
increase of fares on interna-
tionalroutes.Thesetrafficrights
are now unutilised.
On Friday, Civil Aviation
Secretary Pradeep Singh
Kharola met representatives of
domestic airlines, including Air
India, IndiGo, SpiceJet and
Vistara, which want to launch
new overseas flights. “The air-
lines have been asked to give in
writing their requirements and
inform how quickly can they
deploy capacity. The ministry
may consider giving the traffic
rights to other airlines for 3-4
months,”saidanaviationsource
aware of the development.
Traffic rights or seat entitle-
ments on overseas routes are
exchanged between govern-
ments of respective countries
throughAirServiceAgreements.
These entitlements are held by
the government. Airlines are
granteddesignatedcarrierstatus
and traffic rights on a particular
route by the ministry on fulfill-
ing its norms.
Indian carriers have fully
utilised the traffic rights for
Dubai. This means new flights
canbeaddedtoDubaionlyifthe
government negotiates for an
increaseinseats,ortheseatsheld
by Jet are released. Jet Airways,
however, is opposed to this.

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4 WORLD
>
MUMBAI | 4 MAY 2019 1

IN BRIEF Buffett finally embraces Amazon

SoftBank plans IPO for its
Elon Musk makes as Berkshire Hathaway buys stake
$100-billion Vision Fund
SoftBank is considering an initial public offering of its $100 billion
Vision Fund, according to the Wall StreetJournal. The Japanese
$500 bn autonomy Thousands likely to gather in Omaha to attend AGM today
BLOOMBERG
New York, 3 May
a partner with Amazon and
Wall Street bank JPMorgan
conglomerate is also negotiating with the sultanate of Oman for an
investment of 7 billion dollars in the existing Vision Fund, the Journal
reported, citing unidentified people familiar with the matter. The
bulk of the fund was initially backed primarily from the Saudi Arabian
government as well as capital from Apple Inc. and the government of
pitch to investors
BLOOMBERG investors at 11.00 am New
Warren Buffett has said
that he underestimated
Amazon.com’s Jeff Bezos.
Now one of Buffett’s deputies
Chase & Co in a health ven-
ture.
Buffett said in the CNBC
interview that he has been “a
fan” of the online retail giant
Abu Dhabi. Masayoshi Son, SoftBank’s founder and CEO, has been San Francisco, 3 May York time with Musk and is willing to put money and “an idiot for not buying”
deal making at a fast pace, and has invested nearly all of the money Zachary Kirkhorn, Tesla’s behind the tech giant. shares in the past.
that the Vision Fund took in two years ago. BLOOMBERG< lon Musk described chief financial officer, the peo- Berkshire Hathaway has He was speaking ahead of

Peter Mayhew, who
played Chewbacca in
Star Wars, dies at 74
Actor Peter
Mayhew,
who won
over fans
worldwide as
the Wookiee
warrior
Chewbacca in the blockbuster
StarWarsmovies, has died at
the age of 74, his family
announced on Thursday.
Mayhew died on Tuesday at his
home in Texas, the family said
in a statement released on the
actor's Twitter account. "He put
his heart and soul into the role
of Chewbacca and it showed in
every frame of the films...,” the
statement said. REUTERS<
Joblessness rate in
US hits 49-year-low
in April
The United States had another
giant month of job creation
in April, with strong hiring in
the vast services sector and
unemployment fell to a level
not seen since 1969, the
government reported on
Friday. The blockbuster report
will help allay fears of a slowing
economy and cheer President
Donald Trump as he seeks
reelection next year. Employers
scooped up workers in
construction, health care,
computer systems design,
administrative support and
other industries, adding a total
of 263,000 net new positions for
the month. FP/PTI<
E
Warren Buffett said he had
autonomous-driving ple said. been buying Amazon shares been “an idiot for not buying” Berkshire’s annual sharehold-
technology as “trans- Tesla later increased the and the purchases will show Amazon’s shares in the past ers meeting, set for Saturday
formative” to Tesla in a call size of the stock offering, pric- up in a regulatory filing later in Omaha. Thousands are
aimed at ginning up interest ing 3.1 million shares at $243 this month, Buffett told CNBC in recent years. Buffett credit- expected to flock to the city.
in the electric-car maker’s each, according to a person in an interview on Thursday. ed some of his conglomerate’s Buffett has mostly avoid-
debt and stock offering of familiar with the matter, who Buffett, Berkshire’s chairman purchases of airline stocks ed technology-related stocks
about $2 billion, according to asked not to be identified and CEO, said “one of the fel- and Apple to the deputies and over the years, saying he did-
two people who dialed in. because they weren’t author- lows in the office that man- noted their involvement in n’t understand the products
The chief executive officer ized to speak about it. That’s a age money” made the pur- helping Berkshire beyond and markets well enough. One
said autonomy is a funda- Tesla CEO Elon Musk 0.5 per cent discount to chases, a reference to their stock-picking duties. exception was IBM -- his $10
mental driver for Tesla and Thursday’s close. The offer- investment managers Todd The Amazon stake further billion investmentin 2011 did-
key to how it could become a that will be fully capable of ing was increased from 2.7 Combs and Ted Weschler. cements the relationship n’t end well. After taking loss-
“half-trillion dollar market driving themselves. The bil- million shares. Tesla shares Combs and Weschler have between Berkshire and es, he had sold nearly all the
cap company,” said the peo- lionaire plans to put those cars rose 1.3 per cent to $247.38 at gained influence at Berkshire Bezos’s company. Berkshire is IBM stock by 2018.
ple, who asked not to be iden- into a shared robotaxi service 4.36 am in New York in pre-
tified because the call wasn’t that the CEO described as market trading.
open to the public. A Tesla being lucrative for both the Tesla delivered just
spokesman didn’t immedi- company and its customers. 63,000 cars in the first quar- US lawmakers urge authorities not to end GSP benefits to India
ately respond to a request for Ahead of the call, Tesla ter but said in a letter to
comment. filed to raise at least $2 billion shareholders last week that The US should not terminate the Generalised The GSP is the largest and oldest US trade
The comments build on through debt and stock offer- it expects to deliver between System of Preference (GSP) programme with preference programme that allow duty-free entry
the case that Musk made dur- ings, after a dismal first quar- 90,000 and 100,000 vehicles India after the expiry of the 60-day notice period for thousands of products from designated ben-
ing an investor day focused ter depleted its cash balance in the second quarter. on Friday, a group of 25 influential American eficiary countries. On March 4, President Trump
on autonomy last week that to the lowest level in three Kirkhorn re-affirmed that lawmakers has urged the US Trade Repr- announced that the US intends to terminate
Tesla is on the cusp of having years. Goldman Sachs and forecast during the Thursday esentative, warning that companies seeking to India’s designations as a beneficiary developing
1 million vehicles on the road Citigroup hosted the call for call, the people said. expand their exports to India could be hit. country under the GSP programme. PTI

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.
MUMBAI | 4 MAY 2019 ECONOMY 5 <

IRCTC locks horns with RailYatri,

TravelKhana over food delivery
SHINE JACOB At present, RailYatri is one of the
New Delhi, 3 May largest private sector data providers for
train passengers.

T
he India Railways’ catering arm The concept of RailYatri came to
— Indian Railway Catering and the minds of promoters when they
Tourism Corporation (IRCTC) — worked with Indian Railways and
is now at loggerheads with private sec- Centre for Railway Information
tor service providers and applications Systems (CRIS) to develop
— including Nandan Nilekani-backed TrainEnquiry.com in 2012, where they
RailYatri and TravelKhana — that were realised that passengers had other
supplying food on trains. needs, which can be well communi-
According to people in the know, cated in a visual and graphic manner.
IRCTC has approached two lower Its application is currently available
courts in Karkarduma and Rohini (New in eight languages – Hindi, Marathi,
Delhi), saying that the online food Gujarati, Bengali, Tamil, Telugu,
ordering services provided by these Malayalam and Kannada.
companies are illegal. This comes after The average number of meals booked by e-catering on trains daily has now Delhi-based Duronto Technologies
the Delhi High Court recently ruled increased to about 10,000, from 5,188 in FY18 runs TravelKhana that had also raised
that railway ticketing services by the funds from seed funds such as Astarc
website and mobile application already approached the two local At present, the Railways’ arm has a Ventures and some high net-worth
RailYatri was unauthorised. courts against the on-track food tie-up with players like Dominos, individuals.
The court rejected a plea filed by providers, and expects a favourable RelFood, RailRestro, Comesum, At present, IRCTC’s e-catering serv-
Stelling Technologies, which owns and judgement, following the ruling by the Rajdhani Online Food and Zoop. ices are available at 409 A and A-1 class
operates RailYatri. The firm is backed Delhi High Court. Any impact on the “We are now working with the con- stations, for which 136 vendors and 12
by Nilekani and investors like Helion food business may affect RailYatri’s cerned authorities to complete the aggregators are empanelled.
Ventures and Omidyar Network. The business, given about 20 per cent of its required compliances according to the The average number of meals
firm had approached the Delhi High revenue stream comes from this. operating framework of IRCTC, and booked daily has now increased to
Court after IRCTC reportedly filed a This comes at a time when IRCTC is expect this to be completed at the ear- about 10,000. This average daily
petition with the Delhi Police, stating in talks with food-delivery service liest,” said Manish Rathi, chief execu- bookings under e-catering for FY18
that the ticket booking services pro- providers and restaurant aggregators tive officer and co-founder of RailYatri, stood at 5,188 meals. IRCTC provides
vided by RailYatri was illegal. such as UberEats, Zomato, Foodpanda, regarding the Delhi High Court ruling. a total of around 1.2 million meals per
An Indian Railways official told Biryani Blues, Faasos, PizzaHut and TravelKhana, however, did not respond day, out of which around 1 million are
Business Standard that IRCTC has Swiggy, to deliver food to trains. to queries by Business Standard. travelers on train.

GMR Rajahmundry Bhushan Steel former

executes resolution plan
SHREYA JAI
New Delhi, 3 May
GMR Infrastructure (GIL) on
Friday announced the execu-
tion of a resolution plan for its
stressed GMR Rajahmundry
Energy (GREL), a 768 Mw gas-
fired power plant in Andhra
Pradesh. The company
informed the stock exchanges
on Friday that it had paid a por-
tion of the sustainable debt of
the project.
The resolution plan,
approved by the lenders to the
project, consisted of reduction
of total debt of ~2,353 crore to
“sustainable” debt of ~1,412
crore which is a 60 per cent
reduction.
“Against the sustainable
debt, GMR group has already
infused an amount of ~395
crore towards meeting 20 per
cent of the principal towards
repayment of the sustainable
debt and the interest servic-
ing obligations of GREL for
the first year,” GIL said in its
statement.
The balance ~1,130 crore
will be repayable at 9 per cent
over 20 years. The lenders have
converted the remaining debt
of ~941 crore into long-dated
cumulative redeemable pref-
erence shares (CRPS) carrying
0.1 per cent and is repayable
from the 17th to the 20th year,
said the company’s statement.
“The first-of-its-kind reso-
lution plan offers a mutually
beneficial resolution for both
lenders and the firm through a
long-term solution for the
existing debt and related obli-
gations of the group. It has
reduced the debt of the GMR
group and we believe this will
de-risk the group substantially.
This also offers quality assets
built on the ground an oppor-
tunity to perform to its poten-
tial,” said Kiran Kumar
Grandhi, managing director
(MD) and chief executive offi-
cer (CEO) of GIL.
More on business-standard.com
CFO in SFIO custody
PRESS TRUST OF INDIA
New Delhi, 3 May
The Serious Fraud Investi-
gation Office (SFIO) has arrest-
ed former chief financial officer
of Bhushan Steel Nittin Johri
forfraudulentactivities,includ-
ing filing false documents with
various banks, according to
people in the know.
He was managing the
affairs of Bhushan Steel and
was looking after raising of
funds from banks and finan-
cial institutions. He was also
one of the signatories to the
financial statements of the
company till fiscal 2016-17.
The SFIO probe found that
there were several fraudulent
practices at the company,
including manipulations in the
accounts and financial state-
ments during the term of Johri.
These included maintaining
inflated inventories for avail-
ing enhanced working capital,
the sources said.
According to them, he was
also one of the perpetrators of
manipulations through the
instrument of Letters of Credit,
which was done by filing false
documents with various
banks. A large number of LCs,
amounting to more than
~20,000 crore, were opened
using false documents on
behalf of the company over a
period of time starting from
fiscal 2014-15, sources noted.

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6 ECONOMY & PUBLIC AFFAIRS
>
AAR’s GST relief
to realtors, buyers
INDIVJAL DHASMANA
New Delhi, 3 May
Home builders and buyers
will get relief as they will be
paying reduced GST rate after
factoring abatement for serv-
ices associated with construc-
tion of dwellings, at least in
West Bengal.
The state-based Authority
for Advance Rulings (AAR), has
ruled that services such as pref-
erential location charges (PLC),
space for parking, common
area maintenance services
could be bundled with the
main construction services.
Before the recent changes,
builders attracted 18 per cent
GST for their services. How-
ever, the effective tax rate came
down to 12 per cent. Many
builders are charging 18 per
cent GST on ancillary services.
Explaining the case,
Harpreet Singh, partner at
KPMG, said Bengal Peerless
Housing Development Comp-
any approached the AAR, say-
ing that it bundles the PLC serv-
ices, right to use car parking
space and common area main-
tenance services with the prin-
cipal services of construction.
The revenue department
too agreed with the submis-
sions of the applicant and
IN BRIEF
CEA in Advisory Council of
15th Finance Commission
Chief Economic Advisor Krishnamurthy
Subramanian has been included in the
Advisory Council of the 15th Finance
Commission as its member, an official
statement said on Friday. The Advisory
Council was set up in April 2018 to advise
the commission on any issue or subject
related to the terms of reference (ToR) of
the commission, and also to assist in the
preparation of any paper or research
study which would enhance the
commission's understanding on the issue contained in its ToR.
The council now has 12 members, including NIPFP Professor
Pinaki Chakraborty, noted economists Surjit Bhalla, Arvind
Virmani, Indira Rajaraman and M Govinda Rao.
Moody’s changes
Lodha Developers’
outlook to B2
Moody's has downgraded its
outlook on Lodha Devel-
opers to 'negative' from
'stable' citing liquidity
concerns emanating from
falling sales and rising debt
burden. Moody's has,
however, affirmed the
corporate family rating
at B2. BS REPORTER<
No gold shifted
outside India in 2014
or thereafter: RBI
The Reserve Bank of India on
Friday said no gold was
shifted outside India in 2014
or thereafter. The statement
comes against the backdrop
of reports in certain
sections of the print and
social media regarding the
central bank shifting abroad
a part of its gold
holding in 2014. PTI<
IBC’s 43% recovery is fair: CRISIL NBFC crisis averted: Aditya Puri
A BETTER SYSTEM
Gross NPA trajectory
Gross NPA~ trn (11.5) (10.0)
(Gross NPA% in
brackets) (9.5) 10.5 10.0
(7.5) 8.0
6.0
(4.4)
3.2
2015 2016 2017 2018 2019 E
*Under DRT+SARFAESI+Lok Adalat; E: Estimates
ANUP ROY
Mumbai, 3 May
The advent of Insolvency and
Bankruptcy Code (IBC) has
resulted in a recovery rate of
43 per cent, which, according
to rating agency CRISIL, is
“respectable”.
As on March 31 of this year,
the resolution plan for 94
stressed assets was approved
by the National Company Law
Tribunal (NCLT).
“For this set of 94
accounts, resolution has been
reached for ~75,000 crore out
of ~1.75 trillion total claim of
financial creditors admitted.
That makes for a respectable
recovery rate of 43 per cent,”
said a knowledge paper pre-
pared by industry body
https://t.me/SSC4Exams
echoed a similar view that the
overall activity should qualify
as a composite supply with the
construction service being the
principal supply.
The AAR held that it was rea-
sonable to conclude that servic-
es provided by the applicant are
naturally bundled and offered
in conjunction with one anoth-
er in the ordinary course of busi-
ness and the other services of
the bundle are ancillary to the
supply of construction service.
Singh said, “The ruling has right-
ly held that a home buyer can-
not procure PLC or parking serv-
ices without first availing the
construction services and
hence, provision of such ancil-
lary services with construction
services for a single price quali-
fies as a composite supply.”
Abhishek Jain, partner at
EY, said," An aspect to note in
the ruling is the department's
agreement to abatement which
results in a lower rate being
available these miscellaneous
consideration payable in the
real estate sector."
PTI<
IBHFL, subsidiary
to merge with
Lakshmi Vilas Bank
Lakshmi Vilas Bank has
amended its scheme of merger
with Indiabulls Housing
Finance, following which IHFL
and its wholly-owned
subsidiary Indiabulls Comm-
ercial Credit will be merged
with the bank. In the previous
scheme the bank was to be
merged into the housing fin-
ance firm. IBHFL will hold
around 90.5% of the post-
merger enhanced equity capi-
tal of the entity. BS REPORTER<
Foreign exchange
reserves rise by
$4.4 bn to $418.5 bn
India’s foreign exchange
reserves soared by $4.368
billion to $418.515 billion in
the week to April 26, helped
by the second dollar-rupee
swap auction, RBI data
showed on Friday. PTI<
Recovery rates Trend in slippages
across recovery Slippages ~ trn
mechanisms (slippages % in brackets)
Average recoveryrate*
60
50 UNDER IBC
‘09-18 41 40
‘09-19 43
(3.1)
20
2.1
12 0
‘07-08 ‘09-18 2015
ASSOCHAM and rating
agency CRISIL.
“Also, post-implementa-
tion of the IBC, CRISIL esti-
mates the banking sector’s
gross NPA (aggregate)
dropped to 10% in March 2019
from 11.5% at the end of fiscal
2018,” it said, adding that
India’s resolving insolvency
score improved to 40.8 in 2019
from 32.6 in 2016 after the IBC.
The IBC regime also
improved India’s ease of doing
business’ ranking to 77 in 2019
from 130 in 2017.
However, the IBC is a work-
in-progress and despite two
amendments brought for-
ward, challenges remain, with
the major one being adher-
ence to the IBC timeline.
Of the 1,858 cases admitted
EPFO exposure to RCap
stands at ~2,500 crore
JASH KRIPLANI & DEV CHATTERJEE
Mumbai, 3 May
he Employees’ Provident
T Fund Organisation
(EPFO) has an exposure
of ~2,500 crore to Reliance
Capital (RCap) which is facing
liquidity problems with its cash
and bank balances falling to ~11
crore as on March 18, 2019.
According to global broker-
age firm Morgan Stanley,
besides the EPFO, Life
Insurance Corporation of India
has an exposure of ~4,700
crore to RCap and its sub-
sidiary Reliance Home
Finance (RHFL).
In the report showing expo-
sures of various lenders,
Morgan Stanley said that
lenders with exposures to RCap
entities will likely have to mark
down their exposures.
"We have collated recent
NCD (non-convertible deben-
ture) prospectus data on
lenders as of September 2018.
Current exposures could be dif-
ferent, but the exhibits give an
idea of potential names and
approximate exposures," said
Morgan Stanley in the report
dated April 29.
The report said YES Bank
has an exposure of ~1,360 crore
to Reliance Commercial
Finance (RCFL) and another
~990 crore to RHFL. The bank
lent another ~990 crore to RCap,
thus taking its total exposure to
~3,340 crore. The National Bank
for Agriculture and Rural
Defaults by IL&FS must be
declared NPAs: Irdai chief
SUBRATA PANDA
Mumbai, 3 May
Insurance companies must
declare their exposures to
Infrastructure Leasing &
Financial Services (IL&FS) as
non-performing assets (NPAs)
if the infrastructure-financing
firm defaults on repayment,
said Insurance Regulatory and
Development Authority of
India (Irdai) Chairman
Subhash Chandra Khuntia.
Hence insurance compa-
nies have to provide for bad
investments in IL&FS and take
a hit on shareholder profit.
“They have to be treated as
NPAs in the way the Reserve
Bank of India (RBI) has sug-
gested. Insurance companies
will automatically do it. There
is a method of treating NPAs,
which is the same as the one
used by banks under RBI
guidelines,” said Khuntia.
The RBI last week asked
banks and financial institu-
tions to declare the details of
their exposure and provisions
related to the IL&FS group.
The National Company
Law Tribunal (NCLAT) on
Thursday allowed banks to
declare the defaults of the
IL&FS NPAs but restricted
them from initiating any
(7.4)
(6.0) (5.3) 6.0
(3.7)
4.4 4.2
3.3
2016 2017 2018 2019 E
Source: CRISIL-ASSOCHAM Report
in the NCLT under the IBC,
1,143 cases were outstanding
as on March 31, 2019. Of these
outstanding ones, 32 per cent
had surpassed the stipulated
270-day resolution timeline,
the paper noted. “Also, there
are a few big-ticket accounts
for which resolution has not
been finalised for over 400
days,” it said.
“Then, there are other chal-
lenges such as burden on
NCLT to resolve the large
number of cases, clarity on pri-
ority of claims, limited num-
ber of information utilities, liq-
uidation at a ‘going concern’
level, and creation of a sec-
ondary asset market, which
need to be addressed,” said
CRISIL’s President-Ratings,
Gurpreet Chhatwal.
https://t.me/TheHindu_Zone_official
MUMBAI | 4 MAY 2019 1
REC’s higher
offer stirs up
in an interaction, said, "Due to
bond market
a timing mismatch for ongo-
ing securitisation transaction,
LENDERS' there were delays relating to
EXPOSURE TO
RCAP AND
repayments for RCFL and
RHFL. Besides this, we do not
see any pressure on future
repayment obligations."
SUBSIDIARIES In its statement on April 18,
CARE said RCap did not have
any liquid investments or
unutilised committed lines
which further constrain its liq-
Lender Reliance Reliance Reliance uidity position.
Commercial Home Capital Total "Thus, RCL's liquidity is crit-
ically dependent on monetisa-
LIC 0 800 3,900 4,700
tion of its sale of group MONEY MATTERS
YES Bank 1,360 990 990 3,340 assets/investments within the Govt companies that raised funds via AAA-rated bonds
Reliance Capital given timelines, given that Amount Tenure Coupon
1,840 1,080 0 2,920 there are scheduled repay- Issuer Issue Date (~ cr) (years) %
Trustee Co
ments of NCDs and CPs (com- SIDBI 04-08-2019 750.0 3.5 7.59
Nabard 2,800 100 0 2,900 mercial papers) worth ~593
EPFO 0 0 2,500 2,500 crore, ~1,035 crore and ~718 PFC 04-10-2019 * NA NA
TOTAL 19,120 13,270 20,100 52,490 crore in April, May and June REC 16-04-2019 1,600.7 10 8.85
Figures in ~cr; source: Morgan Stanley 2019, respectively. RCL's
NABARD 18-04-2019 2,000.0 3 7.90
resource profile mainly com-
prises NCDs whose repayments HPCL 25-04-2019 500.0 5 8.00
Development (Nabard) also had likely to default). are in the range of ~2,000 crore SIDBI 26-04-2019 1,365.0 3 7.95
an exposure of ~2,800 crore to This was driven by instances to ~3,000 crore per year."
RCFL and another ~100 crore to of rescheduling of NCDs and Going forward, in line with
PFC 30-04-2019 2,578.9 15 8.79
RHFL. A Nabard official said its delays in servicing of bank facil- the revised schedule, the com- NTPC 30-04-2019 3,056.5 3 7.93
exposure is to RCap, but asked ities. The rating agency also cit- pany has divestment plans REC 05-03-2019 1,247.0 2** 8.50
not to be quoted, while a YES ed that given the moderation in aggregating to about ~14,000 *Withdrawn Issue; **2 years, 7 mths, 15 days Source: Markets
Bank spokesperson declined to the profile of RCap, the parent crore including ~6,000-7,000
comment on specific clients. company, it may not be in a crore from Reliance Nippon Life
The total outstanding debt position to extend adequate Asset Management (RNAM) ANUP ROY & SHREYA JAI can be clubbed with other
of these three companies stood support to its subsidiaries. and ~3,000 crore from listing of Mumbai/New Delhi, 3 May NBFC. REC’s bond tenure was
at ~52,490 crore at the end of The rating of RCap's long- its general insurance company. less than that of NTPC.
September 2018, according to term debt programme current- The proceeds of RNAM Bond market participants were “On the last day of April,
Morgan Stanley. ly stands at A, and is on credit divestment are expected to baffled by an unusual deal Power Finance Corporation
On April 26, CARE Ratings
downgraded loans of RCap
watch for developing implica-
tions.
be received by first week of
June 2019.
done by government-backed
REC Ltd, which raised ~1,247
(PFC) raised 15-year money at
8.79 per cent. REC’s bonds
subsidiaries RCFL and RHFL
to D (implying in default or
Meanwhile, Amit Bapna,
chief financial officer of RCap, With inputs from Abhijit Lele
crore from the market for
bonds maturing in two years,
were way shorter in duration.
Even if you consider that REC
seven months and 15 days. has a financing problem, it
The AAA-rated public should not have paid more
infrastructure finance compa- than 8.15 per cent,” said a sen-
COAI prepares ny offered 8.5 per cent for the
money.
ior bond arranger.
The forced merger of PFC
wish list for The deal is unusual
because just two days ago,
with REC posed a few chal-
lenges for both the power
new govt NTPC, another AAA-rated gov-
ernment firm, raised a three-
year fund at 7.93 per cent.
finance companies. For REC,
in particular, it meant losing
concessional line of credit that
in the insurance industry MEGHA MANCHANDA The plan of REC was to it uses for financing flagship
because it was perceived that New Delhi, 3 May raise ~500 crore, with a green- energy schemes.
some insurance companies shoe option of another ~750 REC was suffering from
had invested in debt instru- The Cellular Operators’ crore. Top lead managers for financing troubles and the
ments that were downgrad- Association of India (COAI), the deal were HDFC Bank, merger decision encouraged
ed to junk. as part of its 100-day propos- PNB Gilts and Axis Bank, rating agencies to put REC on
On the downgrade, Khuntia al for the new government, apart from eight others. Bond ‘credit watch negative’, severe-
said: “Earlier IL&FS had been has said it wants issues affect- dealers say there was no ly hurting the firm’s borrow-
downgraded. Now that two ing the financial health of the change in financing condi- ing plans from the market.
more companies have been sector addressed. tions in the two days. The NBFC sector, as a
downgraded, the treatment The industry wants imple- “This shows some despera- whole, has been facing financ-
that was to be given to IL&FS mentation of the National tion on REC’s part. There is no ing problems after IL&FS
has to be done here. There is a Digital Communications reason to raise the money at defaults last year. The recent
procedure that will be fol- Policy, 2018, fixing the Right of this cost. The maturity is also downgrade of Reliance Capital
lowed. At first glance I find Way (RoW) for laying optical very unusual, but that is okay if has aggravated the problem.
there is not too much of expo- fibre, pricing of the 5G spec- there are a few investors But it is the private sector
sure to these two companies.” trum, besides other issues. arranged for the fund. The NBFCs, rather than the public
On the sidelines of an event “There is demand for 5G highest bid was only of ~300 sector companies, that have
“We have seen of the Federation of Indian spectrum and, therefore, the crore. We are very surprised,” suffered more.
Chambers of Commerce and government should look at said a senior bond arranger. Moreover, spreads over
the kind of turmoil Industry, the Irdai chairman the right pricing and quantum According to a senior offi- equivalent maturity govern-
in non-banking expressed concern on corporate of the spectrum, which cial with REC, the issue was ment bonds have also
financial companies governance standards in insur- essentially means large-sized just for testing waters before increased and the market is
ance companies and requested contiguous spectrum,” raising more money from oth- discriminating between
but I am confident
the insurance
them to ensure transparency. COAI Director General er sources. companies and NBFCs, too.
“We have seen the kind of Rajan Mathews told “Currently, the market is If an AAA-rated manufac-
industry will not turmoil in non-banking finan- Business Standard. anyway sensitive to NBFCs. turing company is raising
have that kind of a cial companies but I am confi- Mathews said the rollout So, we are just playing around. money at 100 basis points
problem”
dent the insurance industry of the 5G spectrum in the This is one-time issuance and above equivalent maturity
will not have that kind of a absence of contiguous spec- does not set any precedent. government securities (G-
S C KHUNTIA, problem. The insurance indus- trum would not be possible. Once we have concluded rais- Secs), an AAA-rated private
Chairman, Irdai try should provide stability in He said fibre was a major ing funds through external NBFC will be raising the
times of turmoil,” Khuntia said. requirement for the penetra- commercial borrowing (ECB), same money at 150-160 basis
recovery process because there He outlined initiatives the tion of 5G spectrum and there- our rates will stabilise,” said points above G-Secs.
was a moratorium period. regulator was planning to fore the government should the official, requesting If REC’s move is seen as a
The recent rating down- undertake. ensure a dedicated RoW for anonymity. rate signal by the market, then
grade of a few Reliance enti- seamless laying of the fibre But bond market partici- cost for private NBFCs will go
ties has caused consternation More on business-standard.com network. pants do not agree that REC up further.
CANDICE ZACHARIAHS & RAHUL SATIJA filings show.
Mumbai, 3 May DECADE OF GROWTH The exposure of the wider Indian
Private banks and NBFCs tookmarketshare away banking industry was about $92 billion
Trouble among India’s non-bank from stressed state-run lenders in March, according to an estimate
financiers will persist for at least a year
| State-run banks | Private banks | NBFCs from the ratings firm ICRA. Puri said
even if the danger of a full-blown HDFC Bank has no exposure to IL&FS.
financial crisis has passed, according
| Others % Under Puri, HDFC Bank has also
to the head of the nation’s most skirted India’s bad-loan crisis, which
valuable bank. 2008 60 18 12 10 hurt many of the country’s other
Tighter regulatory oversight and lenders. That has helped its shares
asset sales have staved off the worst of 47 24 18 11 outperform the broader banking index
2018
the problems afflicting India’s non- each year since 2014, boosting its
bank financial firms following last market capitalisation to more than
0 20 40 60 80 100
year’s defaults by Infrastructure Aditya Puri double that of State Bank of India, the
Leasing & Financial Services,
according to HDFC Bank’s Managing
OUTPERFORMER nation’s largest lender by assets.
The stock has gained 21 per cent in
HDFCBank's lowbad loan ratio stands out % of total loans
Director Aditya Puri. Even so, it will be the past 12 months, beating the 16.6 per
another 12 to 18 months before the 14.8 cent increase of the 10-member S&P
liquidity issues in the wider sector are 10.8 BSE Bankex Index.
resolved, Puri told Bloomberg in Though India still has among the
Mumbai on Thursday. 6.5 world’s worst stressed asset ratios,
“It’s not a Lehman-like thing that soured credit as a share of total loans is
comes and then there is contagion
3.6 3.8 estimated to have shrunk to 10.3 per
across the system,” Puri said, referring 1.4 cent by March from 10.8 per cent in
to the US firm that collapsed a decade September, according to the central
ago and plunged the global economy HDFC Foreign Private NBFC Bank sector State-run bank.
into a downturn. “The crisis is over, the Bank banks banks banks The banking industry has made
problem remains.” “substantial progress” in dealing with
Last year’s defaults by IL&FS its non-performing loan problem, Puri
exposed fault lines among India’s concerns about Indian mutual funds paying about 30 basis points more said. He pointed to better recognition
shadow lenders, which had grown that hold debt issued by non-bank than other top-rated corporates, of soured debt, closer central bank
rapidly to account for a third of all new finance companies. according to data compiled by inspections and more disciplined
loans over the previous three years. Shadow banks are still struggling to Bloomberg. behaviour by borrowers after the
Though the government’s decision to raise funds, including from the mutual HDFC Bank had an exposure of $7 implementation of the nation’s new
seize the company helped contain the funds which already hold about $46 billion to non-bank finance companies bankruptcy law. This gives the
crisis, a lingering credit crunch has led billion of the sector’s debt, according to and related firms as of December, government a window to add fresh
to reduced demand for goods like an estimate by Credit Suisse Group. compared with $11 billion for its capital into struggling state-run banks,
automobiles and triggered investor Those that can tap the markets are nearest private-sector rival ICICI Bank, Puri said. BLOOMBERG
https://t.me/Banking4Exams https://t.me/UPSC4Exams
 https://t.me/TheHindu_Zone_official
8 ISSUES AND INSIGHTS
>
MUMBAI | 4 MAY 2019

The misallocated Why the HYV matters in UP politics Adityanath did as chief minister was a harsh
crackdown on the sand mining mafia (which
was run as a side-business by many HYV
activists); action against overloading of trucks
Once a source of Chief Minister Adityanath's clout, the Hindu Yuva Vahini is (which were allowed to go only if they paid a

T
his is the silly “tax” to HYV); and shutting down illegal hooch
season for eco- like a thorn in his side now outlets. “Unka do number ka business thupp ho
nomic policy, gaya (their illegal business crashed),” said a BJP
though some would Unthinkable in the past. But he has to. His as the unchallenged BJP leader in east UP and worker with ill-concealed satisfaction.
say it’s been that for supporters can see that a crucial rule has been to buttress his rise, he announced the formation Slowly, HYV began losing people. State pres-
five years now. It is broken. He explained gruffly to one of them of the Hindu Yuva Vahini (HYV). ident Sunil Singh quit, followed by Ram
therefore a good time that he was no longer just a mahant of the Why HYV when Akhil Bharatiya Vidyarthi Laxman, a crucial activist who is also a Dalit.
to take stock of the sort Gorakhnath mandir but chief minister of the Parishad (ABVP) and Bharatiya Janata Yuva Singh told local journalists that the BJP lost the
of economic advice entire state and all people. Morcha (BJYM), both front organisations of the Gorakhpur by-election (2018) because HYV
that is tendered in our When he was made chief minister, Prime BJP, already exist? A BJP supporter explained workers stayed away from the campaign. A BJP
country. Minister Narendra Modi was asked by a cheeky that the HYV is slightly different. While ABVP worker said it was none other than Amit Shah,
This necessarily supporter: “Why him?” The PM replied: “iss lot and BJYM are more “prabuddh”(intellectual) who requested Adityanath to tighten the reins
MARGINAL UTILITY involves taking stock of
the sort of economists
mein sabse achha wahi hai” (he’s the best of the
lot). There was Keshav Prasad Maurya, now
and “vaicharik” (ideological) the HYV is con-
sidered “lampat” (lumpen), more interested in
of the HYV’s activities, now that he was CM
(“adhyaksh-ji ne nakel kasne ke liye kaha”).
TCA SRINIVASA RAGHAVAN we have. The result is deputy chief minister and reportedly not on creating “danga” (rioting) than ideology. In oth- But Adityanath is not prepared to let go so
dismaying.
The overall prob-
PLAIN POLITICS talking terms with the CM; Manoj Sinha, min-
ister of state for railways with independent
er words, a militia.
Anecdotal data suggests membership grew
easily. On the day the 2019 elections were
announced, the state government issued a noti-
lem is that India has far too many macroeconomists and too ADITI PHADNIS charge of the ministry of communications; and from 300 in 2002 to 1.5 million in 2014. In a fication appointing scores of HYV activists to
few microeconomists. Thus, I had pointed out a few weeks somewhere on the remote horizon, Adityanath. region where large-scale unemployment and positions on boards and other lower-level
ago specifically in the context of the closure of Jet Airways The Gorakhpur Lok Sabha seat is considered migration in search of jobs is endemic, young offices of profit. Although the model code of

and the aviation business generally, India has around three
transport economists. This is surely very odd for such a cap-
ital and labour intensive industry.
That’s not the only problem. Ever since the data bug bit
the profession about 40 years ago, very few Indian econo-
mists know much of economic theory or economic history.
Both are scoffed at with a sneering, “show me the data”.
What this has meant is no data, no economist to think
beyond the immediate. Our economists are mere data
crunchers which means robots will replace them soon.
What is truly worrisome is that the sort of analysis we
saw in economics till about the mid-1970s is now virtually
extinct. This despite the fact that an overwhelming propor-
tion of ‘Nobel’ prizes in economics have gone to theorists.
Go deeper and you will find that among the macroecon-
omists, barely a handful have been trained in formal econo-
metrics. The rest just wing it on software. Indeed, now even
budding lawyers have started doing it. It will be doctors next,
I suppose. Chartered accountants have already got in there.
This sad story doesn’t end here. We don’t have economists
who have specialised in the high-impact field of law and eco-
nomics. That area, too, has been left to chartered accountants
who only study the finance bill and make pronouncements.
As to economics’ younger sister, sociology, perish the
thought. India’s economists don’t allow themselves to be
tainted by something as "flaky" as sociology.
T
he first compromise people noticed
was the food.
Yogi Adityanath is a mahant, a holy man.
He is prohibited, for pollution-purity reasons,
from eating just anywhere. As MP, he would be
invited by voters and constituents for meals
and his supporters would warn them in
advance: “Maharajji khana nahin khayenge…
”. He might have a piece of fruit or a nut or two,
but nothing more.
Now, along with party President Amit
Shah, the mahant of the Gorakhnath temple
is eating everywhere: You can see him squat-
ting and eating with Yadavs, Dalits…
DINNER WITH BS > ZIA MODY | FOUNDER | AZB & PARTNERS
“mandir ki seat”. But previous incumbents —
Digvijaynath and Avaidyanath — never tried
to assert themselves as “true” Hindus although
they claimed to represent the Hindu
Mahasabha and considered BJP somewhat
tame on issues of Hinduism. Adityanath
realised that to be taken seriously, he needed
to make an impression within the BJP. In the
2002 assembly elections, the BJP fielded Shiv
Pratap Shukla from Gorakhpur overruling
claims from the mandir. Adityanath was
incensed and he challenged the BJP by fielding
Radha Mohan Das Agarwal on a Hindu
Mahasabha ticket against Shukla. Agarwal
defeated Shukla. This established Adityanath
people now had a position. In the Gorakhpur
division alone, 500,000 people joined the HYV
as it expanded to the villages. The volunteers
had a range of tasks: From spreading awareness
about encephalitis or brain fever that kills peo-
ple like flies in the region to issues of sanitation.
“Earlier, when you asked a young man what he
did, he would say “nothing”. Now he began say-
ing proudly: “I am a padadhikari (officebearer)
of the HYV,” explained a BJP worker.
The BJP observed the growth and develop-
ment of HYV silently but watchfully. When
Adityanath was sworn in as CM, many cele-
brated, expecting a surge in their fortunes. They
were disappointed. The first three things
conduct came into force immediately, delaying
the perks of office (authority, salary and official
car and accommodation), once the election is
over, they will take over. “In the BJP we have a
system. We send the name from below and it is
vetted at every stage reaching the leadership
via proper channel,” said a BJP worker. “In this
case, none of the names we sent featured on
the list that was finally announced.”
How will this creative tension play out?
BJP supporters say that whatever Adityanath
and HYV might say, there’s a price to be paid
for power. Their prediction? HYV, the source
of Adityanath’s clout, will eventually have to
shut shop.

More orphans
From the school of hard knocks
The mother of all shows, of course, is monetary economics. Over pizza and ravioli, Mody talks to gating regulations, law plus image sand, how close they are, and on
Ever since the FIIs flooded into India, monetary economists management, law plus global which side.”
have blossomed like bananas in Kerala. The only thing they Pavan Lall about her reputation, firm impact, law plus business sense”. In the next four or five years,
need to know is the term "yield" which makes it easy. The I stop and take a sip of my green Mody says, we will see the emer-
rest, yes, you guessed it, is data. It's extraordinary how much
succession and how different clients tea. She works round the clock at gence of class-action law suits in a
time is devoted to discussing the financial markets, as if we
are major players on Wall Street.
require different doses of fear a pace which would deter most
youngsters half her age and then
big way. “Promoters are listening
much harder, the noises being made
Amazingly, given that fiscal matters loom so large on our there’s the matter of her reputa- by proxy advisors and minority

S
economy’s horizon dominating everything, we have very o, who have you signed on
few specialists in public finance. I doubt if it is even taught recently?” I ask of Zia Mody,
any longer in our universities. Everyone is content just founding partner of law firm
tediously analysing the Budget. AZB & Partners. After all, at this
Then there is industrial economics. Three decades ago, stage of her career, Mody, who needs
some Indian economists like Ashok Desai and TCA Anant no introduction, has represented
tried to develop the field. most captains of industry that
Nothing came of it because this time even though the include Ratan Tata, Mukesh Ambani
data was there the effort was too much. Result: India’s indus- and Anand Mahindra. There are sev-
trial policy has always been made in an intellectual vacuum eral others that we don’t know about
by politicians and bureaucrats who have degrees in biology, — and Mody makes it emphatically
zoology and geology. clear it’s going to stay that way.
Oddly enough, we do have a lot of agricultural econo- We’re catching up for dinner and
mists. But if you ask my colleague Surinder Sud, who is an instead of meeting at a restaurant,
absolute master of the game, they don’t know the difference we have decided to order in at AZB’s
between the various types of Indian soils, let alone anything corporate office at Peninsula
else. But since the data is there they hold forth incessantly, Corporate Park in Lower Parel,
mostly about MSP! Mumbai. We sit down in the Oak
Ditto for international trade. The world collects the data, room. India’s best known lady
and our lads joyously piggy-back on it without the faintest lawyer opts for a margherita pizza
clue of industrial economics which, I would think, is the with an extra dollop of sun-dried
minimum you need to know to be a good trade economist. I tomatoes from Quattro on Senapati
asked one of them the other day about the cost structure of Bapat Marg. It’s spinach and ricotta
India’s textile industry. He waved me away. ravioli with a side of grilled vegeta-
bles for me from Cafe Zoe.
More of the same Mody, a vegetarian and strict
And what about sustainability issues and environmental teetotaler, has no pretensions when
economics? These are taught only in a handful of places and it comes to dining, and is as much
there are too few economists who know anything much at home with street food that
about the subject that can be of use at the local and regional includes idlis and other spicy
levels. Go to any seminar and you will see the same faces snacks from lesser known eateries
talking about carbon emissions. as she is to five-star favorites like
And how many universities teach urban economics? How the Thai Pavilion at the Taj Hotel
many economists do you know of who specialise in it? This in Cuffe Parade. Inside AZB’s office
in a country that is haphazardly but rapidly urbanising and in Lower Parel there’s a stillness
needs such economists like a pig needs a pool of mud. that’s periodically broken by foot-
These gaps are clearly reflected in the amount of pub- steps and the sound of young part-
lished research in most of these areas. Why, we have only ners and associates checking on
two or three Indian journals in which it is considered all case updates and calls as they move
right to publish. As a result, the Economic and Political in and out of rooms named after
Weekly has become the acceptable substitute for our uni- trees such as Juniper, Sequoia and
versities. so on.
The worst consequence of this debility is that we import Dinner is laid out for us on AZB
NRI economists who, with one or two exceptions, are not monogrammed china ware and we
quite the sharpest pencils in the box. start the minute it’s served. Mody,
It is like buying Chinese products. Okay, but not really as always, is dressed simply in a silk,
German engineering. purple tunic, one very large record-
size diamond ring and another
unusual Alexandrite one
that matches her tunic.
Almost always, it’s
easy to tell the kind of
mood Mody is in by her
hairdo. If pulled back,
like rockstars or gang-
sters do with pony-tails
tied up with a band, the
message is: Stay out of
the way. If she’s got it
down, you can get away
with pushing the envelope.
Today, it appears, is a regular
hair day.
My ravioli is bang on target, the
Italian dumplings stuffed with
spinach and ricotta cheese are driz-
zled with a tangy orange sauce gar-
nished with slices of green olive
and translucent flakes of garlic.
The slightly charred zucchini and
mixed greens offer as perfect a foil
as they can. I offer Mody some
but she sticks to her com-
pact pizza, that’s neatly
pre-sliced.
AZB’s league tables
rankings are impeccable.
Mergermarket’s latest report puts
AZB at number one with 22 deals
ILLUSTRATION BY BINAY SINHA
valued at around $9.5 billion.
Shardul Amarchand Mangaldas &
Co is at number two with 19 deals
valued at $8.5 billion. It’s the same
with Bloomberg’s legal rankings, and
that of Thomson Reuters, where
again, Mody sits pretty at number
one by value and count.
That isn’t the only reason that
she is the first port of call for most
promoters, conglomerate heads and
CEOs. In her favour, she’s a unique
blend of tough-as-nails counsel who
can switch at light-speed to offer a
sympathetic ear when the client is
losing a deal, is at war with a sibling,
or has made pivotal mistakes after
years of getting it right. Sounds sim-
ple but few do it well.
So, what is the first question she
typically asks while taking on a case?
It depends on the client but if it’s a
negotiation she will ask “what’s the
bottom line that you want from this
deal?,” she says. If it’s litigation, then
the questions are judgment calls on
where the matter is likely to go, how
much reputational damage is likely
to happen and so on, she says,
adding that “every meeting is a law
plus. Law plus strategy, law plus EQ
(emotional quotient), law plus navi-
tion. She’s notorious for being a
merciless task master and AZB is
known for being one of the tough-
est law firms to cut one’s teeth at.
Mody smiles, then says slowly
with jarring honesty, “I’m an
unbalanced human and it’s obvious
I don’t need a balanced life as much
as anyone else because I’ve gotten
used to a certain schedule”.
“You here at this time of the night
and working isn’t balanced either,”
she quips.
The thing is that clients expect a
response quickly, which means that
instead of taking five days to get
back, it needs to be done in two
days. That means you push faster
and run harder than others,
Mody says, adding it’s also the
reason she’s managed to settle
fights, and do the big deals.
“At the end of the day
it’s about the let-
terhead of this
firm.”
She isn’t fib-
bing about the
big deals. In
recent times,
AZB has advised
Tata Steel on its
~35,000 crore acquisition of
Bhushan Steel, one of the largest
deals under the new Insolvency and
Bankruptcy Code; the $14.6 billion
merger of Indus Towers with Bharti
Infratel; and the $1.2 billion ATC-
Vodafone-Idea Cellular merger.
Is there a secret formula to catch-
ing the most high-flying of clients?
“Different clients require different
doses of fear, some get it quickly,
some need to be told categorically
what will happen if they cross the
line, and I don't think we advise
being virginal but what we do is
counsel clients as to the line in the
shareholders are getting louder and
one or two hard class-action cases
will set the tone. It’s coming.” She
also means that fear is today a
stronger factor in decision-making
and there is genuine regulatory con-
cern, about not making a habit of
certain business processes.
How does she deal with loss?
Mody, a follower of the Bahá’í faith
who visits Israel every couple years
on pilgrimage, says she’s okay with
it. “Some big deals will go to com-
petitors, a few talented partners will
leave. The element of churn is there
but the objective is to keep moving
ahead.” Hang on a second — did
Mody just say she’s okay with occa-
sional losses? Has time mellowed
the iron lady of law? It almost
sounds like she’s okay to hang up
her boots sooner than later.
Mody says, “I’ve been perceived
as a larger than life presence, inter-
nally for a long time now, but as my
other founding partners will agree,
we have the best second line of sen-
ior partners in the market, and
institution building stands tall for
all of us.” So is it going to be five,
seven or eight years before she and
her founders retire? “I hope sooner,
I mean look at my hair, it’s getting
white now.” I disagree and tell
Mody it’s dark in patches and she
pushes the last slice of pizza
towards me and it’s clear I am not
being asked but told to polish it off.
I oblige and once done realise it’s
almost 11 pm.
How long will Mody stay in
office? “Another four-five hours or
so,” she says, as she turns to face the
light flashing on her phone, an assis-
tant with a sky-high pile of papers
and three junior lawyers who need
direction. And vanishes into a dif-
ferent world.

And then there was one... The summer of discontent

the neighbourhood children who’d stop
to feed and play with them on the way
to the park every evening. One morning,
the mother just wouldn’t stop crying. It
turned out all her puppies were missing.
The watchmen said that perhaps some
of the children who played with them
had taken the puppies home. “We
thought it was for the best,” they told
me. “They were too young to survive the
PEOPLE LIKE THEM long winter nights outdoors.”
But all hell broke loose that evening.
GEETANJALI KRISHNA Local animal lovers accused the watch-
men of selling the puppies. The police
was brought in to register a case against
asked them to return the puppies.
The very next day, puppy number one
was killed by a speeding car. “We were
devastated,” they said. “Having watched
the puppies being born, seeing one die
in front of our eyes was horrible.” Later,
after the two surviving puppies became
40 days old, the children who had taken
them earlier didn’t want them anymore.
Two months later, puppy number
two was also run over and killed. This
time, the watchmen were furious at the
animal activists. “They ‘protected’ the
puppies from children willing to adopt
them,” they said, “instead of sheltering
to mutter about not being allowed the
same privileges as him. It feels like the
summer of discontent at home.
I blame it on the heat, which is
already at its peak. Normally, by this
time, we would be fleeing Delhi, having
chalked up our travel plans to parts cool-
er than the capital in May. Alas, the city’s
tryst with the 17th Lok Sabha elections
will happen on May 12, considerably
delaying our travel schedules. As a result,
PEOPLE LIKE US prices for tickets on even previously
unknown airlines have skyrocketed, visa
KISHORE SINGH appointments are being offered weeks
later, and rumblings about the unafford-
ability of international destinations is
eymoon,” my wife insists, “now we must
travel as a family.”
My daughter, meanwhile, is keeping
her council. “What are your holiday
plans?” her mother asked her. “This and
that,” my daughter said ambiguously,
“here and there,” which may not have
made sense but put my wife off her trail
— momentarily. In truth, our daughter
hasn’t been able to make up her mind
whether to go with one bunch of friends
to a favourite city, or with another hop-
ing to discover a yet unchartered desti-
nation. I suspect she’s working on the
logistics for both but is tightlipped about
it in case her mother decides to subpoe-

T I
he other day, yet another street
dog was run over by a car near our
house. I stopped to ask the two
watchmen nearby, the only people out-
side in the afternoon heat, if anything
could be done for the unfortunate ani-
mal. “A change of law would be good,”
said one of them. I asked why? The story
they told me gave me food for thought.
It all started when a street dog gave
birth to three puppies in winter this year.
The watchmen finally had something to
do to pass time during their long working
hours. “We looked after them, brought
them milk and found gunny bags for
them to be warm at night,” they said.
The puppies soon became popular with
them as separating puppies less than 40
days old from their mother amounted to
animal cruelty. The watchmen were
flummoxed by the turn of events.
“The puppies were not ours to look
after,” they said. “Neither were they ours
to give away.” They were unaware of ani-
mal cruelty laws in India. Moreover, both
were convinced that their adoption gave
the puppies a better chance of survival. As
the animal lovers became more and more
aggressive, the men decided the unpleas-
antness wasn’t worth it. “We’re poor
migrants,” they told me. “People like us
can’t afford to mess with the police.” So
the next evening, when the same children
passed by on their way to the park, they
them from the elements and the dangers
on the road.” The animal activists, so
vociferous when it came to ‘rescuing’ the
puppies, were oddly silent. “They would
have sent us to jail for animal cruelty,”
muttered one of the watchmen, “but
have done nothing against the drivers
who have run them over.”
We silently watched the mother with
her one remaining offspring, now almost
as large as her, wondering what fate had
in store for them. There are no easy
answers when it comes to the manage-
ment of stray canines in cities. For
humans might have spent millennia
domesticating animals, they still haven’t
learnt to peacefully coexist with them.
t has been a few weeks since my
mother and I talked to each other
over the phone, having had an
altercation that was, shall we say,
unpleasant? My son and his wife too
had their first tiff as newlyweds, caus-
ing them both to sulk — though they
were equally quick to make up. My
daughter, whose daily commute takes
her from Noida to Gurugram and back,
at least has reason to be in a rage on
working days. My wife tells me off so
often that I can safely say we are in a
perpetual state of war. Our driver of
many years suddenly upped and
absconded, complete with loan and
motorcycle, causing the domestic staff
being laid at my door. It was the reason
my son and his wife had a tiff in the first
place, and even though they kissed and
made up, the rumblings have caused
unrest at home.
Oblivious to their discomfort, my wife
keeps butting in with suggestions about
accompanying them. “Can I come to St
Petersburg with you?” she asks, when
she catches them checking for reserva-
tions on the Sapsan high-speed train.
“Can we go to Moscow with them?” she
checks with me. Quietly, when she isn’t
looking, the children change their choice
of destination. “They’re honeymooners,”
I remind my wife, “we should let them
be.” “But they’ve already been on a hon-
na one, if not both.
Since I chose to defer my holiday
plans till after the elections, I now find
myself in danger of being done out of
one entirely. Which must be why I
agreed on a whim to sign up for the
extended family package to the hills this
weekend. It spans three generations and
I doubt it will amount to more than a few
clan skirmishes over harboured child-
hood resentments, which is all one can
anticipate over a couple of days of being
thrown together. Cooler weather should
at least ensure there won’t be too many
frayed feathers — or tempers. Who
knows, maybe my mother and I will even
start being civil again.

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OPINION 9
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Volume Vl Number 40

Modi meets his

Crowd: Yes
MUMBAI | 4 MAY 2019 Mamata: Lakshmi Puja?
Crowd: Yes
WEEKEND RUMINATIONS Mamata: Saraswati Puja?
Crowd: Yes

Cold shower after the polls

T N NINAN
match in Mamata Mamata: Boro din (Christmas)?
Crowd: Yes
Mamata: Ramzan?
Crowd: Yes
Modi & Shah are street-fighters trying to win Bengal Mamata: Chhat Puja?

T
he tax revenue numbers published in this newspaper yesterday are Crowd: Yes
a shock. They show a shortfall of ~1.6 trillion, when compared to the through Hindu-Muslim polarisation. But Mamata is But there’s only one thing that doesn’t happen
revised revenue numbers for 2018-19 presented to Parliament three
months ago. That represents over 0.8 per cent of gross domestic
fighting their poison with her own here — Modi. Modi hoi na (Modi doesn’t happen here)
… BJP hoi na, mithya (falsehood) hoi na, kutsha (char-

Y
product (GDP). Some of the shortfall would have been compensated by a last- ou can pick your metaphor: It takes iron to
minute squeeze on expenditure, reported at the year-end to have been about break iron. Diamond cuts diamond. If you so
~60,000 crore. Taking that as accurate, the fiscal deficit numbers for the year
would have gone up from the reported 3.4 per cent of GDP to about 3.9 per cent
wish, you can even say, poison is the only
antidote to poison. It means the same thing. But the
last may be more appropriate, given that the election
— clear slippage from the levels of the last two years.
campaign we are talking about is our most ven-
The numbers are a shock for a further reason: The Centre’s revenue growth
omously bitter yet.
clocks in at only about 6.2 per cent. It is understandable if this falls short of the
The tone has been set by Prime Minister Narendra
ambitiously budgeted revenue growth of 19.5 per cent. What is more worrying is Modi. Nobody can deny him that
that growth in gross collection (including the states’ share), at 8.4 per cent, falls proud distinction. From calling
short of GDP growth (in nominal terms, ie including inflation) of 11.5 per cent. In opponents anti-national, in
other words, the trend of an increasing tax-GDP ratio has been reversed. Some of cahoots with Pakistan, families on
the shortfall may have been on account of the progressive cutting of rates for the bail/halfway to jail, and so on. His
goods and services tax. But there is the possibility that real economic growth (ie party chief Amit Shah and Uttar
adjusted for inflation) may be less than the officially reported 7 per cent. Pradesh Chief Minister Yogi
The implications for the current year are grim. The Budget numbers for Adityanath have taken this for-
2019-20 project revenue growth of 14.9 per cent on the numbers that had been ward, one calling Muslim immi-
expected for 2018-19. On the real revenue base that has emerged, tax collection grants termites or other kinds of
vermin and the other pitching
would have to grow 29.1 per cent in order to meet the new year’s Budget numbers.
Bajrangbali versus Ali.
Since that is impossible, the Budget will have to be substantially re-cast as soon
as a new government takes charge after the elections. Both revenue and expen-
In large parts of the country, NATIONAL INTEREST
especially the Hindi heartland,
diture numbers will have to be trimmed — and then may better reflect the decel- this is working. But there is a dis-
SHEKHAR GUPTA
eration of economic activity caused by slowing consumption trends. Since much tinction. It is working where the
of government expenditure is on pre-committed items like interest payments, BJP’s main rival is the Congress.
subsidies, salaries and pensions, the axe will fall (as it did late last year) on invest- In Maharashtra, Gujarat, Madhya Pradesh, Bihar,
ment in the physical infrastructure, an important driver of growth so far. Delhi, Haryana, Uttarakhand and Himachal Pradesh,
In terms of the growth outlook, some factors have improved — like the the BJP sees this line working. Because it is mostly
global economic situation, and receding prospects of a US-China trade war. up against the Congress. It responds by asking as to
Oil prices have climbed, but various oil exporters may up output to neutralise how its patriotism can be questioned if Indira Gandhi
the stoppage of supplies from Iran. Domestically, the monsoon prospects are broke up Pakistan, or how you call us soft on terror
when our father and grandmother were assassinated
less than optimal, while two lead sectors (aviation and automobiles) have taken
by terrorists. But it sounds defensive, and its tone
a toss and a third (telecom) has seen value destruction, even as construction isn’t right. Or not wrong enough. Because, as we know,
remains dependent on government spending. The financial and corporate sec- it can’t cut poison with coconut water.
tors have come through the worst of the twin crises of bad loans and excessive To understand how this works, come to West
debt, and credit has picked up. But much cleaning up remains to be done, and Bengal with me, going through the most verbally and
further systemic shocks cannot be ruled out. Monetary policy has tried to sup- physically violent election in the entire country. This
port growth, but the Reserve Bank’s rate cuts find no echo in a liquidity-con- is also where Mr Modi and Mr Shah have found their
strained market for a variety of reasons, including the level of government bor- match in “didi” Mamata Banerjee — her loyalists pre-
rowing. Real interest rates remain high. fer the old-style “Bandopadhyaya”, though. Not a
This is a sobering context in which to consider the promises of expansive word she says in response to the BJP is defensive,
hand-outs as part of the election campaign: Loan write-offs, cash payouts, and nothing is said to play the victim, and because you
mocked her, she mocks you back like none else can
possibly a higher food subsidy. As should be obvious, there simply isn’t the fiscal
with the possible exception, lately, of Raj Thackeray.
space for all of this, or indeed any of it. When the limits of monetary policy are
being tested, the fisc has to be in contractionary mode — especially since the
official deficit numbers conceal off-balance sheet borrowing. As it is, the ratio of
government debt to GDP remains above the limits reckoned to be desirable.
T he Modi-Shah BJP has been targeting West
Bengal for five years. If Hindu-Muslim polari-
sation is their ticket to power, West Bengal should
The danger is a post-poll government being tempted to go the other way, be even more amenable to it than Uttar Pradesh.
taking comfort from moderate inflation and opting for expansionist policies in That’s because West Bengal, like Assam, has a nearly
order to deliver on unaffordable election promises or in pursuit of unrealisable 30 per cent Muslim population. As with the
growth objectives — precisely the kind of policy heresy being heard currently Congress in Assam, there is a feeling that the rulers,
in some other countries. first the Left and now Mamata, have been appeasing
them for votes.
It worked in Assam, so it must work in West acter assassination) hoi na.
Bengal. That is the reason BJP leaders have been
claiming a near-sweep, upwards of 22 seats out of its
42. After Uttar Pradesh (80) and Maharashtra (48), M amata turns the knife and not slowly. Do your
homework, and set it on your teleprompter so
West Bengal sends the highest contingent of MPs to you don’t make a fool of yourself here, “Modi babu,”
the Lok Sabha. she says, a hundred times more mockingly than
If this is where the BJP expected to partly make Modi calls Rahul shahzada or how Rahul may call
up for the losses it might suffer in Uttar Pradesh and Modi chor. She lists, in one breath, all the various
other states they had swept in pujas that take place in West Bengal, taunts Mr Modi
2014, they should rethink. It is true if he even knows the Saraswati Mantra, then recites
that the prime minister’s rallies it in Sanskrit, her crowds, including hundreds of
have been enthusiastic and big. Muslims, cheering. What does Mr Modi know about
But given the low base, the BJP has each religion?
an electoral Kanchenjunga to She quickly moves to food. “Modi babu, if we go
climb here. to Gujarat, we eat dhokla, idly in Tamil Nadu, upma
Mamata isn’t also impressed by in Kerala, litti-chokha in Bihar, halwa in Gurudwara,
the BJP’s shock-and-awe tactic. lassi in Punjab. You order people, don’t eat fish, meat,
She is probably the toughest politi- eggs. Pregnant women should not eat eggs. “Hey
cian in India now, tougher than brother, who are you to order what women can eat
Mayawati. She is also a street-fight- or not?” The country, she says, is being told to eat
er, which Rahul and Priyanka, what Mr Modi eats, buy the waist-coats he wears,
Kamal Nath and Akhilesh Yadav watch him on TV all day. “I used to think he was a
aren’t. But, for further clarity. selfless RSS pracharak,” she says, “but now these
Arvind Kejriwal is. RSS men who paraded in khaki knickers (short-
Steeled through survival in a state that was no bet- pants), roam shopping malls in trousers carrying
ter than a Left Front concentration camp for her, she briefcases and make crores”.
also knows the art of turning adversity into opportu- She attacks him on demonetisation, never wastes
nity. Or, grab the opportunity when Mr Modi a second on Rafale, and delivers the final
says it’s become difficult for Bengalis to even blow: “A party that was starving not long
hold Durga Puja. The Congress ago and used to smoke the same beedi
I track her through rallies on a day when is yet to thrice a day, now owns billions.”
the menacing advance vanguard of the com- understand “And then they call themselves chowki-
ing Cyclone Fani stalks her helicopter. That the Modi-Shah dar,” she says as the crowd sets up a
Durga Puja is the theme running through method “chowkidar chor hai” chant that is louder
these, in Bhatapara (Barrackpore, where for- and more spontaneous than any you hear
mer railways minister Dinesh Trivedi is con- from the front-rows in Rahul’s rallies. In
testing) and Rajarhat, on Kolkata’s outskirts, where West Bengal, Rahul’s party is her rival too. But she
Kakoli Ghosh Dastidar seeks her third term. has neatly appropriated his slogan.
“Modi babu, you must do your homework before The question then: Why does this slogan look so
you shout expletives at us Bengalis,” she speaks at a effective in the hands of a one-state leader when the
pace that even that other fast-talker Gautam Gambhir Congress invented it, and spread it across the coun-
can’t keep pace with, striding left to right and back try? The short answer is, the Congress is yet to under-
on her stage with the wireless microphone, without stand the Modi-Shah method. Unlike Atal Bihari
looking anybody in the eye. Vajpayee and L K Advani, these two are street-fighters
“Even kids get scolded by Didimonis (teachers) and they have accordingly changed their party’s DNA.
when they go to school without doing their home- To fight street-fighters, you need street-fighters.
work. What will people do when you lie? You come Remember, just as we said in the very beginning, iron
to Bengal and tell people that there’s no Durga puja? breaks iron, diamond cuts diamond and, only poison
“Now, tell me mothers & sisters here — do we have counters poison. If Mr Modi and Mr Shah have made
Durga Puja or not? a poisonous, polarising campaign their brahmastra
Crowd: We do for 2019, Mamata Banerjee is showing them its limi-
Mamata: Does anyone stop you from celebrating tations. Or why it will “hoi na” (won’t happen) in her
Durga Puja? state of 42 MPs.
Crowd: No
Mamata: Louder, does Durga Puja take place here? By Special Arrangement with ThePrint

Why it’s smart to bet on climate science Is yeti real? Not a

larly in the US Many investors are conser-
vative. As one finance professional told
Uppsala University researcher Brett
Christophers for a recently published
study of institutional investor attitudes
toward climate change:
Oil and gas analysts are generally not
in a 2018 study by the asset management
firm Schroders.
The “show me the money” attitude is
natural, but another recent paper high-
lights at least one part of the financial com-
munity that’s taking climate science seri-
ously. Wolfram Schlenker and Charles
options is small and illiquid. Billions of
dollars of such derivatives are traded over
the counter: They’re used mainly in the
matter of science
reinsurance business, given that about 30 yeti/bigfoot theory is based on such
per cent of the US economy is estimated EYE CULTURE anecdotes only.
to be directly affected by the weather. But And, in the words of social sci-
weather derivatives is still a niche area for KUMAR ABISHEK entist Frank J Sulloway: “Anecdotes

building climate risk into their models.
There is zero chance that any of these groups
are going to divest from oil or gas companies
any time soon. You still get investors in the
US who don’t believe in climate change.
These guys honestly couldn’t give a stuff.
LEONID BERSHIDSKY Christophers’s study, based on inter-
views with executives at investment firms
with more than $1 billion under manage-
Taylor from Columbia University looked
at the US market in exchange-traded
weather derivatives for 2002 through 2018,
comparing the way investors priced tem-
perature expectations for a particular
month with climate scientists’ tempera-
ture forecasts based on the impact of
human activity. They found something
approaching full agreement between the
major investors. Traders who specialise in
these instruments have to be more attuned
than other finance professionals to what’s
really going on with the planet’s climate.
There’s no reason for climate skeptics to
go out of their way and make contrarian
bets on barely liquid contracts.
Nevertheless, investors should pay more
attention to what’s going on with weather
A
couple of years ago when I
tagged along with a friend to
watch a poorly critiqued
Bengali movie, Yeti Obhijaan, little
did I know that awful experience one
day would come handy to write
about the legendary beast. Though
the movie, like most researchers, dis-
missed the claim of a giant primate
do not make a science. Ten anec-
dotes are no better than one, and a
hundred anecdotes are no better
than ten.”
Science cannot completely dis-
prove that “yeti is real” because it is
not a question for science. Non-sci-
entific theories could not be falsified
as they aren’t testable in a legitimate

A
tipping point for governments in
aligning their policies with the sci-
ence of climate change won’t be
brought about by schoolkids demonstrat-
ing. It will come from a shift in investor
sentiment.
Data show that even if investors don’t
flag environmental cataclysm as a major
concern or even express skepticism about
it, there are some who bet consistently and
successfully on the scientists being right.
Conservatives are on the whole still
skeptical about climate change, particu-
ment, showed that these financiers weren’t
interested in selling their fossil fuel assets,
didn’t see productive ways of incorporat-
ing climate change into their models, and,
if they did see it as a risk, then saw it as
merely one of many.
That led Christophers to conclude that
environmental lobbyists and progressive
politicians wouldn’t sway the investment
crowd until it saw a clear financial return
in adjusting for climate change. As things
stand, sustainability plays a minor role in
investment decisions, as was made clear
traders and the white coats. Schlenker and
Taylor wrote:
The observed annual trend in futures
prices shows that the supposedly efficient
financial markets agree that the climate is
warming. At least so far, climate models
have been very accurate in predicting the
average warming trend that’s been observed
across the US. When money is on the line, it
is hard to find parties willing to bet against
the scientific consensus.
That’s probably an overoptimistic con-
clusion. The market for weather ETFs and
derivative pricing. The market has existed
for 20 years, long enough to make it clear
that betting against the consensus climate
models doesn’t pay. This should have
broader implications. If the derivatives mar-
ket is bearing out these projections, divest-
ing from fossil fuel stocks and looking for
more sustainable opportunities should be
viewed as reasonable strategies. Stocks
exposed to climate risks might be more mis-
priced than commonly perceived.
©Bloomberg
species wandering in the Himalayas,
it ended with a mysterious unseen
creäture lurking and watching
humans leave the mountains, and
thus helped keep the belief in folk-
lore alive.
Stories about yeti, popular among
sherpas and among millions world-
wide, are back in the spotlight after
the Indian Army recently tweeted
photographs of giant footsteps,
claimed of a yeti.
It’s important to note that crea-
tures like komodo dragon, giant pan-
da and gorillas were all discovered
partly because of folklore. Also,
way. There was no possible objection
that could be raised which would
show the theory to be wrong.
Noted astrophysicist Carl Sagan
in his book The Demon-Haunted
World: Science as a Candle in the
Dark, to encourage sceptical think-
ing, offers a story concerning a
fire-breathing dragon that lives in
his garage.
When Sagan persuades a rational,
open-minded visitor to meet the
dragon, the visitor remarks that he
couldn’t see the creäture. Sagan
replies that he “neglected to mention
that she’s an invisible dragon”. The

Celebrity couples sparkle for brands Malik, Jyoti Randhawa-Chitrangada

The rise of couple celebrity brands
begets two questions: first, are celebrity
couples saleable just because they are
married? Second, are individual partners
singly more powerful as brands than the
couples together?
To answer the first question about
marriage as the USP, let us go down mem-
ory lane to see why celebrity couples in
India never really caught public fancy
and, therefore, did not get to do brand
endorsements together.
When Dilip Kumar married Saira
YES, BUT... Banu, Yusuf Saheb’s career was well neigh
over and Saira really wasn’t an ‘A’ grader.
SANDEEP GOYAL Sunil Dutt and Nargis could have been a
genuine power couple but then Nargis
just renounced the movies after they
taboos of those times. But by the time
the two were married in 1969, Pataudi had
started to fade out from cricket and the
couple preferred to remain low-profile
post marriage. Dharmendra and Hema
Malini were hardly ever seen together in
public as a couple. Rishi Kapoor and
Neetu Singh were young, buzzy, success-
ful and popular when they got married:
all the right ingredients for a power
alliance but the marriage was very rocky
in the initial years, never allowing them
to build a public profile of togetherness.
In cricket, Sunil Gavaskar and wife
Marshneil were pretty well known
together as a couple, when he was at his
peak in the 70s. But she had no independ-
ent credentials, and did not really add to
Singh, Mahesh Bhupati-Lara Dutta and
Leander Paes-Rhea Pillai are all good for
Page 3 but fall short of the fame thresh-
old, and therefore cashable commercial
value together.
So, famous couples need more than
just matrimony to sell brands. They
require togetherness, that too visible and
enduring happiness together, that makes
them aspirational, trustworthy, respect-
ed, and worth emulating as a couple.
Choices so far have been limited.
Recent research by
Indian Institute of Human Brands
(IIHB) shows that for a couple brand to
succeed today:
1) at least one of the two must be in top form
2) both must independently be respected
3) be seen to be successful
4) be buzzy.
Amongst the current choice sets, Virat
Gigantopithecus blacki, an extinct
species of 10 ft tall apes that existed
100,000 years ago, lived in the region
which today comprises India, China,
Vietnam and Indonesia.
In 2004, Henry Gee, editor of the
journal Nature, wrote: “The discov-
ery that Homo floresiensis (3-4 ft tall
cousin of humans) survived until so
very recently, in geological terms,
makes it more likely that stories of
other mythical, human-like crea-
tures such as yetis are founded on
the grains of truth.”
Earth is a big planet and many
species still remain undiscovered.
Could yetis be one of them? Unlikely.
Two studies of “yeti” samples in
the past five years — one published
in 2014 in Proceedings of the Royal
Society B and the other published in
2017 in the same journal — have indi-
visitor then suggests spreading flour
on the floor so that the creature’s
footprints could be seen, to which
Sagan says “this dragon floats in the
air”. When the visitor considers using
an infra-red camera to view the crea-
ture’s invisible fire, Sagan explains
that the fire is heatless. He continues
to counter every proposed physical
test with a “reason” for why the test
will not work.
Sagan concludes: “Now what’s
the difference between an invisible,
incorporeal, floating dragon who
spits heatless fire and no dragon at
all? If there’s no way to disprove my
contention, no conceivable experi-
ment that would count against it,
what does it mean to say that my
dragon exists? Your inability to inval-
idate my hypothesis is not at all the
same thing as proving it true.”

V
irat-Anushka (Virushka) featured
together in the Google Duo ad last
week, their second advertising
outing together after they became man
and wife. Their first campaign together
was for Manyavar, just a few weeks before
they tied the knot a year ago.
Deepika-Ranveer (Deepveer) too
debuted together in an ad for Lloyd
air-conditioners last month. They have
done movies together in the past but this
was their maiden effort for brand
endorsement together. Akshay-Twinkle
have been featuring together in ads too,
the most recent one being for
Fortune basmati rice. Saif-Kareena
(Saifeena) have been featured together by
AirBnB and Abhishek-Aishwarya
(Abhiash) have jointly endorsed TTK
Prestige pressure cookers.
https://t.me/SSC4Exams
married. Rajesh Khanna was India’s first
superstar and Dimple Kapadia was the
darling of the nation after the success of
Bobby but the marriage itself was not a
very successful or enduring one. When
Amitabh Bachchan and Jaya Bhaduri tied
the knot, Jaya was actually the
better-known half of the couple. As
Amitabh carved a dominant position in
Indian cinema, Jaya however faded into
domesticity.
When Indian cinema’s heart-throb
Sharmila Tagore married the Indian
cricket captain Mansoor Ali Khan
Pataudi, they together had just the right
credentials to become a power couple: he
was a right royal Nawab, and the
youngest ever captain of the Indian crick-
et team and she was the first actress to
have posed in a bikini, breaking the
her husband’s persona as one of India’s
finest cricketers. Sachin and his wife
Anjali could have been cricket’s original
first couple, but Anjali preferred to keep
her head down despite her own
independent credentials as a doctor.
Mohd Azharuddin and Sangeeta Bijlani
did hit the upper circuits for a while as a
couple but his getting mired in the
match-fixing controversy killed any pos-
sibilities of their becoming an aspira-
tional power couple. Dhoni and his wife
Sakshi are part of Colgate’s latest version
of Andar se Strong campaign, but Sakshi
is hardly known.
Harbhajan Singh and his actress wife
Geeta Basra, Yuvraj Singh-Hazel Keech,
Zaheer Khan-Sagarika Ghatge, Stuart
Binny-Mayanti Langer, Dinesh Karthik-
Dipika Pallikal, Sania Mirza-Shoaib
https://t.me/Banking4Exams
drives the Virushka brand with his per-
formance. Anushka adds the oomph.
Akshay is a winner-all-the-way while
Mrs Funnybones provides class and
charisma. In Deepveer both partners are
equally strong and individually no. 1.
Unfortunately for Abhiash and Saifeena
neither couple is a top leaguer.
Going forward Virushka, Deepveer,
and Akshay-Twinkle are all well poised
to break the celebrity couple jinx of the
past many decades. If Ranbir-Alia decide
to tie the knot, they too will join this
August league of made in heaven
alliances to sell brands with their sparkle
and sizzle. The era of the Celebrity
Couple, methinks, is finally here.
The writer is an advertising and media veteran
sandeep@goyalmail.com
cated that the samples belonged to
bears and not a primate species.
Similar studies in the past, too, have
discouraged any belief in yeti.
But as the popular aphorism goes:
“The absence of evidence is not evi-
dence of absence!” No research, so
far, has disproved the existence of a
yeti or a bigfoot (the western version
of a yeti-like creäture).
So, should we believe in Nepalese
folklore? No. And here comes the
need for encouraging people towards
critical and sceptical thinking.
The study of animals whose exis-
tence has yet to be proved is known
as cryptozoology and cryptids, or
“hidden animals,” start their lives as
blurry photographs, grainy videos,
footmarks and countless stories. The
https://t.me/UPSC4Exams
According to the principle of
Ockham’s Razor, attributed to 14th-
century scholastic philosopher and
theologian William of Ockham,
more straightforward explanations
are, in general, better. That is, if you
have two possible theories that fit
all available evidence, the best the-
ory is which has fewer abstract
ideas, or guesses.
So, a better and scientific theory
would be that there is no giant hairy
primate roaming the snowy peaks
of the Himalayas. Because all it
takes to prove this idea wrong is to
find one!
Every week, Eye Culture features writers
with an entertaining critical take on art,
music, dance, film and sport

10 THE SMART INVESTOR
>
HUL investors need
THE COMPASS
to cool expectations
after weak Q4 show
Near-term challenges on the
volume front remain a concern
HAMSINI KARTHIK
After a weak show by some
of India’s important fast
moving goods (FMCG)
firms such as Britannia and
Dabur, expectations from
Hindustan Unilever (HUL)
were a bit muted. The HUL
stock, accordingly, fell by
over 2 per cent on Friday,
before the results that came
post market hours.
However, the numbers
weren’t as bad as antici-
pated, except for the net
profit. Revenue at ~9,809
crore in the March quarter
(Q4) grew 9 per cent YoY;
half a per cent lower than
the Bloomberg consensus
estimate of ~9,858 crore.
Net profit (before excep-
tional items) at ~1,590
crore (up 13 per cent YoY),
though, missed estimates
of ~1,651 crore.
However, investors
shouldn’t be disappointed
as HUL managed to
expand its operating profit
margins (Ebidta) from 23.1
per cent last year to 24 per
cent in Q4, despite a tough
operating climate.
While the cost of goods
sold as a percentage of rev-
enue remained at 48 per
cent, advertising costs and
other expenses grew at a
slower pace than revenue,
at 3.5 per cent and 8.5 per
cent YoY, respectively. The
Street had pegged margins
at 23-24 per cent.
Margin expansion was
comfortably aided by
growth across segments.
HUL’s mainstay product
line — beauty and personal
care — which accounts for
about half its revenues,
maintained margins at a
comfortable 28 per cent,
while its food and refresh-
ments, and home care seg-
ments retained operating
margins at 18 per cent each.
Sebi partially relaxes order
against OPG Securities
PRESS TRUST OF INDIA
New Delhi, 3 May
Sebi on Friday partially
relaxed the order against OPG
Securities and three directors
in the NSE’s co-location facil-
ity case, by allowing the stock
broker to close its open posi-
tions in the F&O and currency
derivatives segments within
two months.
On Tuesday, the regulator
had barred OPG and its three
directors from the markets
for 5 years and asked them to
disgorge illegal gains worth
~15.57 crore, along with 12 per
cent annual interest.
Following the order, it is
understood that OPG holds
open positions in the futures
and options (F&O) and cur-
rency derivatives segments at
Indian automobile stocks
set to skid further: Analysts
BLOOMBERG
Singapore, 3 May
India’s car stocks have lost
$42 billion in value in the
last 16 months, and some
analysts say the rout may
not be over.
A gauge of automobile
companies has fallen
30 percent since
reaching a tor have fur-
record high in
December
2017, and is
the worst-
performer
among 19 sec-
toral indices of
the BSE.
A slowdown in consump-
tion, amid a cash crunch in
the banking system, has left
carmakers with a pile of
unsold vehicles in what was
one of the world’s fastest-
growing auto market until
last year. Little surprise
then, that Maruti Suzuki
India, Hero MotoCorp and
Mahindra & Mahindra are
https://t.me/SSC4Exams
This shows price hikes
undertaken in the past
year, coupled with efforts
to improve the share of pre-
mium products, particular-
ly in the beauty segment,
has yielded the desired
result. Volume growth at 7
per cent was at a 6-quarter
low but met expectations
of 6-8 per cent, coming on
the back of last year’s high
base of 11 per cent growth.
For investors, though,
volume growth will be a
larger concern, going
ahead.
“Operating margin of 23
per cent (in Q4) is the high-
est-ever for us. We also
delivered margin expan-
sion in 30 out of 31 quarters,
which is significant,” said
Sanjiv Mehta, HUL chair-
man and managing direc-
tor. Analysts at ICICI
Securities also note that
with volume growth mod-
erating for five consecutive
quarters, demand is peak-
ing out in certain rural
regions.
With HUL committed
to deliver volume growth,
analysts say there is room
to cede margins.
Investors will need to
moderate their near-term
expectations from the
country’s largest consumer
firm. The HUL stock has
corrected about 9 per cent
in 2019 so far, and valua-
tions have moderated from
70x its FY20 earnings to 59x
the earnings.
the end of trading on April
30, 2019, which need to be
closed, the regulator said.
Accordingly, “the direc-
tions issued vide the final
order shall stand relaxed for
the limited purpose of allow-
ing the Noticees to close the
open positions in the F&O and
currency derivatives seg-
ments of OPG Securities on or
before the expiry date of the
among the biggest losers on
the Sensex this year, notch-
ing losses of up to 20
per cent.
“Initial trends are looking
weaker than expected,”
Nomura Holdings analysts
Kapil Singh and Siddhartha
Bera wrote in a May 2 note.
“Most compa-
nies in the sec-
ther earnings
risks due to
weaker-than-
expected
demand.”
Passenger
vehicle growth
in the financial
year ended March was the
slowest since 2014, accord-
ing to the Society of Indian
Automobile Manufacturers.
Maruti Suzuki, the nation’s
largest by market share, slid
for seven days through
Tuesday after saying April
revenue declined 17 percent
from the year-ago month.
Only two of the 16 com-
Lax reporting standards for
PMS providers worry experts
Portfolio managers lag mutual funds
in disclosures, assets stand at ~15.6 trn
JASH KRIPLANI
Mumbai, 3 May
T
he Portfolio manage-
ment service (PMS) sec-
tor has grown at a sharp
pace in India, with the growing
pool of high networth investors
(HNIs) going for this invest-
ment option in search of higher
returns. However, experts say
that despite the sizeable client
base, PMS providers lag their
domestic MF counterparts by
quite a distance, when it comes
to reporting and disclosure
standards.
Over the last four years, the
size of assets managed by PMS
providers has grown at an
annual rate of 16 per cent. At
the end of February, assets
under management of portfo-
lio managers stood at ~15.6 tril-
lion with a client base of over
147,300. As the industry gains
in size, experts say disclosures
made by portfolio managers,
particularly with respect to per-
formance, should improve.
“Lot of PMS firms report the
returns of a model portfolio,
which doesn’t give a fair picture
of the performance of actual
Sugar sector outlook turns positive for next season
VIRENDRA SINGH RAWAT
Lucknow, 3 May
The beleaguered domestic
sugar sector, which has been
impacted by mounting sug-
arcane arrears and market
glut, is looking for ‘sweet’
times next season (2019-20).
This comes on the back of
projections of lower produc-
tion, coupled with higher
diversion of the crop for
ethanol manufacturing.
Besides, given the likely
higher offtake of sugar this
summer, with the Centre rais-
ing the sugar sales quota to 2.1
million tonnes (mt) for May
and a similar quota expected
respective contracts, or within
a period of two months from
April 30, 2019, whichever is
earlier," the Sebi said.
The ‘noticees’ are OPG
Securities and its three direc-
tors Sanjay Gupta, Sangeeta
Gupta and Om Prakash
Gupta. However, the relax-
ation is subject to certain
conditions, the stock market
regulator said.
BSE AUTO
30,000
18,900
25,000
20,000
20,652
15,000
Jan 2,’17 May 3,’19
Source:Exchange
Compiled by BS Research Bureau
panies on the BSE Auto
Index have held their heads
above water this year: Tata
Motors and Bajaj Auto.
Auto companies that
have attractive products, are
disciplined in managing
their inventories, and invest
in research and develop-
ment should still outper-
form during the slowdown,
Pramod Kumar and
Anubhav Bajpai, analysts
from Goldman Sachs Group
Inc wrote in a report.
However, they are still
cautious: “We don’t see any
relief in the near term.”
https://t.me/TheHindu_Zone_official
portfolios within a strategy.
These are also typically net
returns (after fees), which does-
n’t show the impact of the fees
being levied on the investor,”
said Sanjay Parikh, who is lead-
ing the initiative to implement
the Global Investment
Performance Standards — for-
mulated by the CFA Institute
— in India.
“Moreover, there is also no Assets of PMS firms have soared, rivaling domestic MFs
clarity on whether returns for
a financial year take into
account all investor returns for
that period, or excludes returns
for exiting investors,” he added.
According to experts, com-
puting returns on the basis of
only existing investors could
give a lopsided view of a strate-
gy’s performance.
“Typically, an investor exits
a PMS-managed portfolio
when he is disappointed with
the returns. So, while reporting
returns for a financial year, the
provider should adjust for exit-
ing investors’ returns too,” said investors to the regulator’s ble with other PMS’ returns
Jinal Sheth, portfolio manager website, where returns shown reported,” Sheth added.
at Multi-Act Equity PMS.
Further, such practices can across strategies. These don’t Exchange Board of India’s
lead to mis-selling. “There are give a fair picture of the per- (Sebi) site states the perform-
instances of advisors pointing formance and aren’t compara- ance of portfolio managers has
for June, the sentiment in the
sugar space is turning positive.
According to ratings
agency Icra, the hike, coupled
with seasonal higher sugar
demand in the summer —
especially for soft drinks, ice
creams etc — will help reduce
domestic cane arrears to an
extent, though the magnitude
of the problem is quite big.
The increase in sales quota
will support mills in clearing
dues, even though the supply
situation continues to put
pressure on sugar prices, cur-
rently hovering at
~31,000/tonne.
The Indian Sugar Mills
Association (ISMA) says water
Markets end
marginally
lower; IT
stocks drag
PRESS TRUST OF INDIA
Mumbai, 3 May
The benchmark indices
surrendered early gains to
end with modest losses on
Friday — led by selling in
IT bluechips — as investors
awaited fresh buying trig-
gers amid frothy valua-
tions. After trading on a pos-
itive note through the day,
the Sensex ended 18.17
points, or 0.05 per cent, low-
er at 38,963.26.
In similar movement, the
broader Nifty slipped 12.50
points, or 0.11 per cent, to
close at 11,712.25.
During the holiday-trun-
cated week, the Sensex fell
104.07 points, or 0.26 per
cent; the Nifty shed 42.40
points, or 0.36 per cent. IT
stocks came under pressure
after tech giant Cognizant
slashed its full-year revenue
growth outlook.
Cognizant, which has a
significant number of its
employees based in India,
revised its full-year 2019 rev-
enue growth outlook to 3.6-
5.1 per cent in constant cur-
rency terms, significantly
less than the 7-9 per cent
projected just months ago.
In the Sensex pack, los-
ers included TCS, HUL, Tata
Steel, HCL, Infosys, Bajaj
Finance, HDFC, IndusInd
Bank, Asian Paints, ITC and
Vedanta, shedding up to 3.7
per cent. HUL, too, ended in
the red ahead of its quarter-
ly results.
On the other hand,
Bharti Airtel, ICICI Bank,
NTPC, YES Bank, Tata
Motors, ONGC, Bajaj Auto,
M&M, Maruti, Hero
MotoCorp and Kotak Bank
rose up to 3.11 per cent.
Meanwhile, foreign insti-
tutional investors bought
equity worth ~597.54 crore
on Thursday, while domes-
tic institutional investors
sold shares to the tune of
~791.69 crore, provisional
data available with stock
exchanges showed.
https://t.me/Banking4Exams
GAINING SCALE
AUM (~cr) Discretionary Non-discretionary Advisory
Listed equity 100,609 17,744
Unlisted equity 575
Plain debt 1,144,568 74,075
Structured debt 646
Equity derivatives 484
MFs 13,776 13,612
Others 15,572
Total 1,276,230 107,224
No. of clients 136,586
Source: Sebi
are combined for all portfolios, The
in Maharashtra reservoirs was
below normal level on
account of lower rainfall in
the last monsoon season,
with indications that cane
acreage in the state would be
‘significantly’ lower in the
coming season. Even at the
all-India level, there is expec-
tation that sugarcane avail-
ability will be much lower
than the current season,
thereby reducing production.
Further, with additional
greenfield and brownfield
ethanol production capacities
coming up, the sugar industry
is better placed to divert larg-
er quantities of ‘B’ heavy
molasses/sugarcane juice
> FROM PAGE 1
Financial sector may lose weight...
Some of the downsides of the move
include frequent churning of index
components and under-representation
of large sectors of the economy.
“Improper weights skew the Nifty’s
performance away from the structure
of the economy. Sectors like metal,
mining and heavy industrials don’t
have adequate representation in the
stock market as they have in the econ-
omy.
“Some efforts need to be put in
towards more alignment of the stock
market and the real economy.
Otherwise, we will see this divergence
where the nominal GDP growth is 12
per cent but corporate earnings are
growing at barely 6 per cent for a
decade now,” Mukherjea added.
The weight of a particular stock is
computed on the basis of its free-float
Godrej arm
buys piece of
film history:
RK Studio
Rishi Kapoor had said that
the decision to sell came
after a lot of heartburn. His
announcement caused an
uproar with fellow actors
and politicians decrying
the decision.
One even suggested that
the government take it over
and build a national film
museum in honour of Raj
Kapoor.
However, the family
seems to have had the last
word. And after a long hunt
and months at the negoti-
ating table, Godrej
Properties won the day.
Randhir Kapoor, actor
and son of Raj Kapoor, said:
“This property in Chembur
has been of tremendous
significance to my family
over the many decades that
RK Studios has operated
from there. We are excited
to have chosen Godrej
Properties to script a new
chapter for this location
and build upon its rich
history.”
MUMBAI | 4 MAY 2019
78
460
-2
1,258
171,267
6,729 3,998
Data as on February 28, 2019
Securities and
away from sugar into ethanol.
This will further reduce
production in 2019-20 and
insulate the sector from mar-
ket glut conditions that
market capitalisation, which excludes
the shares owned by promoters or those
under lock-in.
As Indian banks like HDFC Bank
Jaypee Infra lenders reject bid
Construction might be
delayed by a year
The rejection of Suraksha’s
bid has effectively removed
all chances of starting work
in 2019, according to the
people close to the process.
“Last time it took almost
nine months to come to the
process of voting on a firm.
Now again fresh bids will be
called and this would stretch
the process as new bidders
are planning to join the race.
This means until at least the
end of this year, work on
Jaypee sites might not
start,” said Pankaj Gupta,
who in 2010 gave the down
payment in Jaypee Wish
Town’s Kensington Park
Apartment project.
NBCC the top choice of
home-buyers
The homebuyers fear things
are again going off the hinge
in the way they did almost
eight years ago.
NBCC, which has had
extensive discussions with
homebuyers, was their obvi-
ous choice.
However, it was not
allowed to take part in the
present round of bidding
HDFC Life’s
~1,400-cr OFS
subscribed
not been approved or recom-
three times
SUBRATA PANDA
Mumbai, 3 May
mended, and also that it doesn’t
certify the accuracy or adequa- The ~1,400-crore offer for
cy of their monthly reports.
However, industry insiders
sale (OFS) in HDFC Life
Insurance Company saw
say the fine print is not empha- thrice the demand com-
sised upon while selling PMS pared to the shares on offer.
products. Currently, regula- The 36-million share
tions laid down by Sebi only offering garnered bids for
mandate PMS providers to fol- 111.5 million shares from
low the weighted average institutional investors,
method to calculate returns in shows data by the stock
individual categories. exchanges. Most of the bids
“While the regulator has came at ~406, higher than
regulated the MF industry the base price of ~390 set for
heavily as it is more retail- the OFS.
focused, it has not set tight Shares of HDFC Life end-
norms for the PMS sector, giv- ed at ~413.6, down 0.82 per
en its orientation towards more cent, on the BSE. Another
sophisticated and wealthy 3.6 million shares for retail
clients,” said a PMS provider, investors — those investing
requesting anonymity. up to ~200,000 — will be
Following the 2008 market auctioned on Monday.
crash, Sebi decided to curb Standard Life, the joint
some of the practices in the venture partner in HDFC
PMS industry. The minimum Life, was the seller in the
investment size was increased share sale.
from ~5 lakh to ~25 lakh, fund The UK-based firm sold
managers were restricted from 1.78 per cent stake, paring its
pooling investments from holding to 22.88 per cent.
clients, and the norms around In March, Standard Life
profit-sharing or performance- had divested 4.93 per cent
related fees were made tighter. stake in HDFC Life to raise
While industry sources say about ~3,600 crore.
these changes have helped in Following the OFS, the
giving more credibility, there is promoter’s holding in HDFC
more scope for improvement Life will come down to
in the reporting standards. 74.36 per cent.
announce its preliminary
estimates of crop availability
and production for the 2019-
20 season. For the current
season (Oct 2018 to Sep 2019),
however, ISMA has projected
production at 33 mt, about 0.5
mt more than last season.
Recovery in the sector has
been higher across India com-
pared to last season.
Although the quantum of
cane crushing is lower, sugar
production was nevertheless
projected to be higher.
depress sugar prices and Till end-April, 32.2 mt of
result in arrears. sugar had already been pro-
ISMA will obtain satellite duced in the country.
images of domestic cane cul-
tivations next month, to More on business-standard.com
and ICICI Bank are promoter-less insti-
tutions, they have high free-float mar-
ket cap and thus higher weights in the
index. On the other hand, Tata
Consultancy Services (TCS), the coun-
try’s second-most valued firm, is not
even among the top five companies in
terms of Nifty weights due to high pro-
moter shareholding.
Besides sectoral caps, the NSE is
also considering surveillance-based
parameters for selecting stocks for the
Nifty and other indices.
Under this regulatory action against
a company such as additional margin
requirements for derivatives, price
bands, addition to so-called graded sur-
veillance measure (GSM) or additional
surveillance measure (ASM) would
spoil the chances of a stock being
added to an index.
because it did not have the reviewed the letters.
permission to do so. However, the veracity of
Fears that NBCC might these allegations could not
not bag the project are so be independently ascer-
high that homebuyers have tained.
written more than a thou-
sand letters to the prime Jaypee promoters trying
minister, finance minister to win back confidence
and urban development In emails as well as meetings
minister. with homebuyers, the
“Knowing very well that Jaypee promoters are trying
there is overwhelming sup- to win back customer confi-
port from both banks and dence.
homebuyers to NBCC’s pro- “The ongoing process for
posal, the IRP, Anuj Jain, did over 18 months has allowed
not put the NBCC proposal work at snail’s pace but it is
to vote on the grounds that essential that the matter
it did not have the finance gets resolved, incomplete
ministry’s permission. “But homes are completed and
it is evident from the finance delivered in a time-bound
ministry note that NBCC manner, which alone can
had those permissions,” said mitigate anguish and pain
Manish Goyal, a homebuyer, caused to you. I am aware of
in his letter to the prime your unhappiness yet feel
minister. responsible to share the
Others said the voting road map which we believe
process was sabotaged. “Just would surely address your
before voting commenced, concern and can be the path
all the passwords of home- which shall pave the way for
buyers were erased. The resolution of this subject
process was stopped and despite certain reserva-
resumed after a nine-hour tions,” Manoj Gaur as exec-
delay,” said Dharmendra utive chairman and chief
Kumar, another homebuyer, executive officer of the
in his letter to the PM. beleaguered company said
Business Standard has in an email to homebuyers.
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16 POLITICS & PUBLIC AFFAIRS
>
MUMBAI | 4 MAY 2019

‘Squirrel’ TMC digs deep, doesn’t rule out queen’s chair

NIVEDITA MOOKERJI
Kolkata, 3 May
Derek O’Brien, chief national
spokesperson and leader of the
Trinamool Congress (TMC) in the
Rajya Sabha, rushed to take a call on
his mobile while speaking to
Business Standard Friday afternoon.
On the other side was ‘Didi’, as
Bengal chief minister and TMC
founder Mamata Banerjee is popu-
larly known. Worried that former
Bharatiya Janata Party (BJP) leader
Yashwant Sinha, had suddenly fall-
en ill while campaigning for TMC in
Kolkata, Banerjee wanted to ensure
the best care possible. Pilot cars and
a team of helpers were sent out in
no time and Didi was promised
hourly updates on Sinha’s health.
Cyclone Fani, that hit the Odisha
coasts early morning, washed out
the election campaign rosters in
West Bengal as well, giving some
free time to political managers
who’ve been working 24x7. But
Banerjee, who too cancelled her
campaigns, rallies and public meet-
ings for 48 hours, got busy with pre-
cautionary measures, including
shutting down of airports, while
constantly checking the social
media updates on both Fani and
poll buzz. She can’t stay away from
mobiles, WhatsApp and FaceBook,
people who know her well say.
On the campaign trail
Engaged in regular face-offs with
Prime Minister Narendra Modi
through her speeches and Twitter
messages as West Bengal has
emerged one of the most important
states in the 2019 Lok Sabha polls,
Banerjee has been doing two to
three rallies daily. The total count
is between 84 and 102 rallies, most-
ly flying in and out of constituen-
cies in a chopper that’s parked in
the grounds where she addresses
gatherings up to 8,000-10,000. Add
to that 35 padyatras. Besides a heli-
copter for Banerjee, two more are
in a state of readiness all the time.
One for Abhishek Banerjee, TMC
MP from Diamond Harbour con-
stituency and the CM’s nephew;
and another for Suvendu Adhikari,
minister in charge for transport and
environment in the state. Behala
Flying Club is often the take-off
point for Didi, who’s fighting it all
out to block the BJP from making
further inroads into the state,
according to people in the know.
While it’s tough to chase Baner-
jee on her back-to-back campaign
trail as she’s invariably before time,
the talk of a growing support base
for Modi is hard to ignore. At a rally
addressed by Banerjee in Palta, a to-
wn in the Barrackpore constituen-
cy, a homemaker said earlier this
week, “Modi delivers, he’s a strong
leader.” She has many backers. A
state government official, request-
ing anonymity, said, “A coalition
government at the Centre will be no
good, we need a strong leader at the
top and Modi is the answer.”
The numbers don’t match
O’Brien doesn’t want to get into the
numbers on how many seats TMC
and BJP could win. “I’m not a
psephologist,” he said, adding, ‘’BJP
five years ago, that could push up
its tally to around eight.
On the other hand, BJP, which
does not have any strong public face
in West Bengal, is laughing at TMC’s
“optimism”. At the non-descript
BJP headquarter, next to Yunani
Diagnostics in Kolkata’s College
Square, Tushar Kanti Ghosh, state
secretary of the party, told this
newspaper, “We are likely to cross
30 seats in West Bengal. Earlier, the
estimate was more than 20, but the
support base is swelling.”
Mamata Banerjee addresses a rally in Barrackpore on Thursday PTI Modi versus Didi
Leaving nothing to chance, the
won’t get enough to form the next compare on May 23, who’s closer to tallest BJP leaders —Modi and Shah
government at the Centre.’’ The the truth,” O’Brien said. “BJP is like- — have been campaigning in the
TMC, he said, would stick to its tar- ly to be the main Opposition party state regularly. They are scheduled
get of winning all 42 seats in West when it comes to Lok Sabha seats to come again next week ahead of
Bengal. BJP President Amit Shah from West Bengal. Nothing more.” the two final phases. According to
had recently projected 23 out of 42 While political analysts pointed TMC partymen, there’s no match
for his party in the state. If that hap- out that BJP’s Bengal vote share between Didi’s connect with people
pens, the BJP would add 21 to its could increase from around 17 per and that of Modi and Shah, who
current kitty of two in the state. cent in 2014, they argued it’s being don’t know the language of the
In the 2014 Lok Sabha elections, over-ambitious on the number of majority in the state. Banerjee and
TMC won 34 seats, Congress four, seats. BJP could well get the seats Modi make it a point to hit out at
BJP two and CPI(M) two. “Let’s that Congress and CPI(M) had got each other in their election speech-
es, from rosogolla with pebbles to
speed-breaker Didi and much more.
If Banerjee could be the PM if
the mahagatbandhan were to form
the government at the Centre,
O’Brien said she had the CV for the
top job. “But, TMC doesn’t mind
being the squirrel,” he said, elabo-
rating that in every garden squirrels
are needed to do the ground work.
“Squirrels can sometimes become
the queen of the garden,” he joked.
Meanwhile, the pre-election
coalition that was announced in
January, is holding meetings to join
the manifestos of the various par-
ties, to be prepared to form the next
government, it is learnt.
Banerjee, who stays away from
media interviews barring to a couple
of TV channels, is spearheading the
coalition work. In the process, she
doesn’t miss her twice a day exercise
regime — 90 minutes on the tread-
mill and a round of brisk walk. A fr-
ugal eater, Didi loves her muri, and
can do with very few hours of sleep,
a quality that she shares with her
biggest rival, the PM.

Will replace GST

POLL WRAP
Poll panel gives clean chit to
PM in two more speeches
Congress leaders to take general with GST 2.0:
Chidambaram
The Election Commission (EC) concluded on Friday that Prime
Minister Narendra Modi did not violate the model code or its
advisory on armed forces in his speech in Varanasi. It also found
nothing wrong in his comments made in Nanded, Maharashtra
coaches to spread NYAY message
ARCHIS MOHAN on party surveys that showed that
SIDDHARTH KALHANS
Maharajganj, 3 May

“In the ongoing campaign for

where he reportedly dubbed the Congress as a ‘sinking Titanic’. New Delhi, 3 May Rahul Gandhi’s popularity and accept- the Lok Sabha elections, only
With this, the EC has decided on five complaints against Modi ance is much more than Modi in south- the Congress manifesto is in

and gave him a clean chit in all matters. “In a matter related to a
complaint concerning alleged violations of advisories of the
Commission and Model Code of Conduct, in a speech delivered by
Narendra Modi at Nanded, Maharashtra on April 6, a detailed
report of the Chief Electoral Officer, Maharashtra was obtained.
The matter has been examined in detail ... no such violation of
the extant advisories/provisions is attracted,” the EC said.
Biopic on PM
Modi to release
on May 24 now
The makers of Vivek Oberoi-
starrer biopic on Prime
Minister Narendra Modi
Friday announced that the
film will be released
countrywide on May 24, a day
after the results of the Lok
Sabha elections are declared.
The film, titled PM Narendra
Modi, was earlier set to
release on April 11 but was
banned by the Election
Commission. In its order last
month, the EC had banned
the screening of film during
the poll period, saying any
such film that subserves
purpose of any political entity
or individual should not be
displayed in the electronic
media. BS REPORTER
VVPAT case: SC to
hear Oppn leaders’
plea next week
The Supreme Court on Friday
agreed to hear next week a
review plea filed by 21
Opposition leaders seeking
further increase in random
matching of VVPAT slips with
EVMs in the ongoing general
elections. The apex court had
on April 8 directed the
Election Commission to
increase random matching of
Voter Verifiable Paper Audit
Trail slips with EVMs in five
polling booths per assembly
segment from one booth. PTI
PTI
Defamation
complaint filed
against Kejriwal
A man, claiming to be a BJP
member, has filed a criminal
complaint against Delhi Chief
Minister Arvind Kejriwal
before a city court for
allegedly defaming the
saffron party leaders.
Additional Chief Metropolitan
Magistrate Samar Vishal put
up the matter for hearing on
May 16. The complainant has
alleged that his and his
party's reputation was
dented by a defamatory
tweet made by Kejriwal in
September last year. PTI
Submit expense
details in 90 days,
EC tells MNS
The Maharashtra Navnirman
Sena (MNS) has been asked to
submit details within 90 days
of expenses incurred on the
election rallies of its president
Raj Thackeray.An election
official said the notice for
submission of election
expenditure was issued after
consultations with the
Election Commission
following a complaint from
the BJP demanding that
expenditure incurred on MNS
rallies be shown in the
accounts of opposition
candidates in the nine Lok
Sabha constituencies where
Raj Thackeray addressed
rallies. PTI
A
s the Hindi heartland prepares ern India. However, that is not the case talks. Not even Prime
for the fifth phase of polling on in northern India states, where the PM Minister Narendra Modi or
Monday, the Congress has remains popular. any Bharatiya Janata Party
nuanced its campaign tactics to make In Bharatpur, Rahul Gandhi (BJP) leader is talking about
it appear less of a contest between accused the PM of deceiving youths by their own manifesto,” former
Prime Minister Narendra Modi and promising 20 million jobs and leaving Union finance minister P
party chief Rahul Gandhi. It has also them unemployed. "Forget about Rs 15 Chidambaram said at a rally
decided to sidestep the BJP’s core plank lakh in bank accounts, he (Modi) did in Maharajganj, where he was
of nationalism to focus on issues of not deposit even Rs 5. He thinks that addressing an election cam-
unemployment and farm distress.
The Congress leadership is set to
people of the country do not under-
stand anything. He kept assuring that
paign for the first time.
At the campaign for
travel in unreserved compartments in
trains heading to and from some of the
money will come in bank accounts he
had opened," Gandhi said.
Congress candidate Supriya
Shrinate, Chidambaram said
poll-bound states, particularly Madhya In a letter written in Hindi, the if voted to power, the current
Pradesh, next week to spread the mes- Congress president made an emotional form of GST will be replaced
sage of its key promise of ‘Nyay’ or min- Congress leader Priyanka Gandhi Vadra urged the PM to protect farmers PTI appeal to the voters of Amethi urging with a more simplified GST
imum income guarantee of ~72,000 a them to re-elect him and promising to 2.0, where liberal tax rates
year to 20 per cent of India’s poorest fifth phase across seven states ends on dynastic leadership of the Congress. give momentum to the development will suit the business com-
families. Saturday evening. Congress leaders, In terms of seats going to the polls, works in his Lok Sabha constituency munity. There would be one
Addressing a rally in Rajasthan’s including party chief Rahul Gandhi it is the smallest of the seven phases. "blocked" by the BJP government. simple return every three
Bharatpur district on Friday, Rahul and general secretary Priyanka Gandhi, Seats in Bihar, Jammu and Kashmir, Taking a dig at Rahul Gandhi, months for the businessmen
Gandhi in a reference to the Jan Dhan kept focus on issues that had brought Uttar Pradesh, Jharkhand, Madhya Finance Minister Arun Jaitley on Frid- in the GST 2.0. Like the Saral
Yojana said the Congress would the party victories in the Pradesh, Rajasthan and West ay wondered how the Congress presi- form for Income Tax there
deposit ~72,000 annually in the peo- December Assembly polls in Bengal will have polling in this dent could damage the image of would be Saral GST in the
ple's bank accounts “opened” by Prime Madhya Pradesh, Rajasthan phase. In 2014, the BJP had Prime Minister Modi who is riding on Congress regime.
Minister Modi. and Chhattisgarh. swept most of these seats. the peak of his popularity. The Addressing the NYAY
In Rae Bareli, Congress leader The BJP leadership spent Congress sources said the dynasts have self-illusionary opinion samwad in eastern UP,
Priyanka Gandhi Vadra advised the PM the day targeting the Gandhi party has changed its campaign about themselves and tend to become Chidambaram said the
to protect the fields of farmers. “You family since Amethi and Rae POLL tactics as the elections has megalomaniacs, he said adding Congress brought Right to
are protecting people from Pakistan’s Bareli Lok Sabha seats, consid- VAULT entered the north Indian states. "Rahul Gandhi is no exception", he Education, Right to Food,
aggression. This is a big achievement. ered strongholds of the family, 2019 In southern India, where the stated in a blog. Right to Information and
Everyone is happy. But you should also go to polls on Monday. The BJP election is now over, the In New Delhi, BJP leader Piyush MNREGA, and now it will
protect the fields of farmers. That is leaders kept the debate centred Congress had portrayed its party Goyal said Rahul Gandhi will lose from ensure that every poor gets
nationalism as well,” she said. on the leadership of Prime Minister chief Rahul Gandhi as a more able and Amethi as he has not done any devel- ~72,000 per annum as finan-
The campaigning for 51 seats in the Narendra Modi and criticised the tolerant leader than Modi. This is based opment work there. cial assistance.
Till Phase 6, number of women in fray crosses 600
SACHIN P MAMPATTA
Mumbai, 3 May
Democratic Reforms (ADR)
and released on Friday.
A LONG WAY TO GO report. A total of 11 candidates
have cases related to hate
has declared zero assets.
But the overall proportion
n % of women candidates n % of candidates with criminal cases
Some couldn’t be analysed speech against them. of candidates with assets of
n % of candidates with assets of at least one crore rupees
Data on candidate details up because of incompleteness or Candidates with assets of more than ~1 crore is 32 per
to the sixth phase of Lok Sabha unavailability of properly sca- 32 27 33 28 32 more than ~1 crore outnumber cent in phase six (311 in num-
polls has revealed that the nned documents. The figure is 25 both women and those with ber). There are 2,018 such can-
23
number of women candidates based on analysed affidavits. 21 20 criminal records. didates so far in the first six
17 19
has risen to 617. The proportion of women can- 16 The average assets of can- phases of elections. They acco-
The total number of didates has actually dipped in 12 didates for the sixth phase of unt for 29 per cent of all candi-
women candidates for this the sixth phase. It is down to 9 10 9 elections is ~3.41 crore. The dates, across phases. They
7 8
phase is 83. Polling for phase nine per cent compared to 12 richest candidate is the include members from the
six will take place on May 12 per cent in phase five. Candi- Congress’ Jyotiraditya Scindia BJP, the Congress, Bahujan
while the earlier phase (fifth) dates with criminal cases con- with assets worth ~374 crore. Samaj Party (BSP) and Aam
is on May 6. tinue to outnumber women. In Phase 1 Phase 2 Phase 3 Phase 4 Phase 5 Phase 6 This is followed by former Aadmi Party (AAP).
The total number of candi- fact, twice the proportion of Source: The National Election Watch and Association for Democratic Reforms (ADR) cricketer Gautam Gambhir “Among the major parties,
dates for phase six is 979. Of phase six candidates have (BJP candidate) with assets of 46 of the 54 candidates from
this, the affidavits of 967 can- criminal cases against them. Six candidates have cases against women. This includes ~147 crore. Virender Rana from BJP, 37 of the 46 candidates
didates have been analysed in This is consistent with ear- related to murder, 25 have cas- assault or crime to outrage the Haryana’s Gurgaon con- from Congress, 31 out of the 49
a report prepared by non-gov- lier rounds of polls. Those with es of attempt to murder and modest of a woman and cru- stituency is third with assets candidates from BSP, and 71
ernmental organisations the criminal cases against them five related to kidnapping in elty. “Two candidates have of ~102 crore. One candidate, Independent candidates have
National Election Watch as account for 19 per cent of the phase six. Twenty one candi- declared cases related to rape Rajib Mahato, from the Purulia declared assets worth more
well as Association for candidates across phases. dates have cases of crime (IPC Section 376),” noted the constituency in West Bengal, than ~1 crore,” said the report.

SP banks on ‘boatman’ to upset Ravi Kishan in Yogi’s bastion

Ravi Kishan (centre) may have his heart in the
right place but many BJP workers see him as an
object of some amusement. (Inset) Gorakhpur SP
candidate Ram Bhuyal Nishad PHOTO: ADITI PHADNIS
ADITI PHADNIS
Gorakhpur, 3 May
Walking into the campaign
headquarters of Ram Bhuyal Nishad,
Samajwadi Party (SP) candidate for
the Gorakhpur Lok Sabha seat, at 7 am
is slightly unsettling. The venue is
someone’s vacant home. The air is
thick with the smell of stale sweat.
Scores of men can be seen rushing in
and out of toilets in various stages of
undress. There are no
women.
The Nishad (boatmen)
community is nearly
300,000-strong in
Gorakhpur. “Their job?
They fish by day and drink
by night,” says an upper
caste Bharatiya Janata Party
(BJP) leader, guffawing. The
Nishads consider themselves
Scheduled Caste, though they are
counted as Other Backward Class
(OBC) which puts them in the same
category as the Yadavs. Socially they
are far lower on the caste ladder than
the Yadavs.
In the room, there is no difference
of opinion on one issue: ‘The biggest
struggle for the Nishad community is
the right to ‘samman’ (self-respect),”
says Ram Bhuyal. A crowd of burly
men standing around shout in
agreement.
Ram Bhuyal, called ‘mantriji’ by
dint of the fact that he was made
minister for fisheries in the Mayawati
government when she was the chief
minister, has been in both the SP and
the Bahujan Samaj Party (BSP). He
knows the structure as well as the
working of the two groups intimately.
He is keen to talk but his workers say it
is time to go — as he strides out of the
room, he flags political issues: the new
All India Institute of Medical Sciences
(AIIMS) is nothing more than a
useless pile of bricks (not quite true, as
the OPD is already functional) and in
any case it is there only because of the
grace of Akhilesh Yadav, the SP
president and former chief minister
who sanctioned land for it. He is
bundled into a waiting vehicle by a
crowd of fierce-looking men and
driven off to a meeting.
By contrast, Ravi Kishan, Bhojpuri
and Hindi film actor, strolls in wafting
a cloud of some exotic after-shave. His
campaign office is in the basement of
an upscale mall and is decked up like a
wedding hall complete with huge
wreaths of paper roses and carnations
in lurid colours. A crowd of — mostly
— young volunteers trails after him.
He looks exhausted and puffs out his
cheeks and exhales when the local
MLA and his minder, Radhakrishna
Das Aggarwal chides him about all the
things that are wrong with his
campaign. “You must get back into
the city before 6 pm. That way you can
meet people and supporters in the
city, instead of wasting your time
lurching around in the dark in the
villages,” Aggarwal is telling him. He
looks at the milling crowds, briefly
shuts his eyes, and then squaring his
shoulder, invites Business Standard to
an ante room for an interview.
The anteroom soon fills up with
people but he ignores them. He got to
know on April 14 that he was the BJP
nominee for the Gorakhpur seat and
left shooting in Kochi (with Mr
Bachchan and Chiranjeevi Sir) to do
‘seva’ in Gorakhpur. He began life as
an actor in Ramleela (he played Sita)
in his home town of Jaunpur in 1991
and then, from small film parts, was
offered bigger roles until he came to
be known as the biggest actor in
Bhojpuri cinema. He has done a stint
in Big Boss and has made his way into
Hindi, Telugu and Tamil industries.
He could have lived anywhere, had
anything… why the hot, dusty and
exhausting business of politics and
elections? From him it doesn’t sound
like a cliché. “I don’t know politics,
only the pain of the people. I am a
country boy. I wanted to give
something back,” he breathes. What is
he? A millionaire? A billionaire? And
doing this? He nods to both.
“Somewhere along the line, I felt I was
getting lost. Thanks to a great man like
Chief Minister Yogi Adityanath, I
found my way,” he says. Yogi
Adityanath didn’t deign to attend his
nomination. “But his blessings are
with me. He will be coming here to
campaign for me,” he says.
Kishan may have his heart in the
right place but he is seen by the BJP
workers as an object of some
amusement. When he moved into
temporary digs after he started his
campaign, he insisted that state of the
art gym equipment be installed in a
spare room. He is a fanatic about
working out. And gyms are a promise
to his electorate, along with a place of
pride to actors and ‘kalakars’. “We are
creative people. We are artists. I am
determined to counter the campaign
that we are just ‘naachne gaane
wallah”. He says. “Not everyone can
be a doctor or an engineer or an IAS
officer. Any form of art is a job. Actors
are sensitive people. They are not
brainless, as people often think.”
His campaign punchline is:
“Zindagi jhund ba! Gathbandhan ke
mooh band ba’ (life is a mess/and the
Grand Alliance has its mouth shut). It
leaves BJP workers a bit confused and
bewildered (“is ‘jhund’ even a word,”
one of them asked another). But the
people roar in approval. “Everyone
wants a piece of me,” Kishan says in a
sudden panic. “They want my hands,
my clothes, my shoes… they’re
touching me, feeling my presence.”
But when asked about what the
Nishad community might feel about
him, his reply is pure politics. He
stands up and says grandly: “I am an
actor. I have no caste”.
ISSUES AND INSIGHTS P8
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.
A journey down the Ganga in the age of Modi
He is seeking a second five-year term in elections this month, but voters on the country’s holiest waterway have doubts
BLOOMBERG
3 May
he is said to have descended to Earth
S to release humankind from suffer-
ing, a gift from the creator Brahma.
Every Hindu in India learns the story of
the goddess Ganga and the medicinal qual-
ities of her waters. And every dying Hindu
is given a few drops from the Ganges River
to free the soul from the cycle of life and
death. Narendra Modi’s first act on taking
charge as prime minister in 2014 was to
worship India’s holies t— and arguably its
most polluted—watercourse. “Mother
Ganga needs someone to take her out of this
dirt,” Modi declared from his electoral dis-
trict of Varanasi as millions watched on tel-
evision, “and she’s chosen me for the job.”
From its origins in the Himalayas to the
Bay of Bengal, the Ganges flows for 1,570
miles through five of India’s most popu-
lous states. A place of worship, a source of
livelihoods, of water, power, and transport:
It is all of those and more. As Modi seeks a
second term in elections that began in April
and stretch through mid-May, a journey
along the river’s course offers a chance to
appraise his impact on India’s heartland,
and assess how voters judge his record.
At one level, Modi’s popularity seems
largely intact, with little evidence of a
groundswell of support for the opposition
Congress led by Rahul Gandhi, yet the low-
er castes and Muslims who together make
up one-third of the country’s 1.3 billion
population are growing increasingly critical
as they feel sidelined by Modi’s Hindu
nationalist party.
What seems clear is the “Modi wave”
that helped him win India’s biggest man-
date in three decades on a pledge of jobs,
economic development and ending cor-
ruption is absent this time around.
When it tumbles down from its source
in the Himalayan glaciers, the Ganges is
pristine. But any sense of purity at the great
river’s main headstream, the Bhagirathi,
was lost as road rollers, earth movers, and
scores of workers in yellow helmets crashed
rubble and boulders down the mountain-
side. They were widening the road to allow
cars to reach four iconic Hindu temples in
Uttarakhand, a state run by Modi’s
Bharatiya Janata Party and assumed to
have voted the prime minister’s way in the
first phase of India’s seven-stage election.
The Modi government initiated the 560-
mile Char Dham highway project without
commissioning an environmental impact
assessment, despite concerns raised by the
National Disaster Management Authority
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MUMBAI | 4 MAY 2019
about road construction in such moun-
tainous terrain. Flash floods in 2013 killed
more than 5,000 people in Uttarakhand,
and the authority fears a repeat. Some 2,500
families facing displacement as a result of
the construction began a general strike in
December. Their battle continues in the
courts.
“So much should have changed after
the floods,” Kesar Singh Panwar, 53, said by
the river’s banks. He lost his home in the
2013 flooding and has challenged the gov-
ernment’s development plans in court. He
supports Modi but thinks he has bad advis-
ers. “We should have ensured policies that
protect the Himalayas and the Ganga.”
Instead, he said, dam-building and cutting
into the mountains continue unabated.
“That’s very, very dangerous.”
Whoever wins India’s elections will have
to confront the trade-offs required to devel-
op the country and meet its potential.
Dams on the Ganges generate 4,900
megawatts of power, enough to supply New
Delhi, while 97 cities and towns use its
water. Some 11 billion litres of industrial
waste and effluent is discharged back into
the river each day, the equivalent of 4,400
Olympic-size swimming pools.
Tourism has become an economic
mainstay. Uttarkashi, a town of 17,000 on
the river’s upper reaches, was once where
people went after renouncing the world. It
doesn’t seem ready for the influx of tourists
the government plans. No hotel has more
than one star; many sell hot water by the
bucket. There was a power cut when we
visited. Hotel owners are adding rooms
regardless.
The transformation of the Ganges from
a spiritual journey to an economic resource
is arguably the story of Modi’s new India.
His critics say Modi’s focus on cosmetic
changes — building Himalayan highways
and sprucing up riverbanks instead of tack-
ling the deeper challenges facing the more
than 400 million people of the Ganges
basin, from jobs to child malnutrition —
reflects his politics. The dissonance
between campaign promises and imple-
mentation was a recurring theme on the
journey.
Downstream at Haridwar, a city of more
than 300,000, a cow roamed the yard of
the Matri Sadan ashram, a Hindu retreat.
Swami Shivanand Saraswati, Matri
Sadan’s founder, complained the govern-
ment wasn’t serious about finding a solu-
tion. “We have given up the world. We have
nothing left to lose but our lives,” he said.
He and other sadhus, or holy men, had
great hopes for Modi in 2014, counting on
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Narendra Modi’s first act on taking charge as prime minister in 2014 was to worship
India’s holies t— and arguably its most polluted — watercourse
his credentials as a staunch Hindu leader.
“But Modi has disappointed us.”
The change in topography from moun-
tains to the Ganges plains is abrupt, open-
ing up into a vista of roads lined with
banyans and Indian fig trees, or peepuls.
Kanpur is the first big industrial town
after the river descends into Uttar Pradesh,
India’s most populous state and a key elec-
tion battleground.
A couple of workers whitewashed the
walls of the empty courtyard enclosing
Naiyer Jamal’s factory, where the 61-year-
old sat in his office drinking tea with a half-
dozen Muslim men. The idle plant and
endless rounds of chai have been their dai-
ly routine since December, when the state
government shut down all 256 of Kanpur’s
tanneries.
Uttar Pradesh’s Chief Minister Yogi
Adityanath ordered them shut before the
Ardh Kumbh festival, when millions bathe
in the confluence of the Ganges and
Yamuna rivers on days considered auspi-
cious according to the Hindu lunar calen-
dar. Kanpur’s leather industry is worth
some 480 billion rupees ($7 billion) a year.
Past governments shut Kanpur’s tanner-
ies for three weeks at most. This year’s clo-
sure of four months and counting is
unprecedented and has already cost mil-
lions of dollars, said Jamal.
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ECONOMY & PUBLIC AFFAIRS 17
They appealed against the closures all
the way up to the Indian trade ministry in
Delhi, to no avail. Now he fears the govern-
ment wants them closed for good. “We are
easier to target because we are weak,” he
said. “Only two communities touch leather
in India, we Muslims and the Dalits, or low-
er castes. Now so many people have lost
their livelihoods.”
Kanpur’s tanneries have been in the
legal sights for more than three decades.
India’s Supreme Court first ordered they
set up a sewage treatment plant in 1985
after chromium and metals from the fac-
tories were found to be contaminating the
Ganges. The tanneries say poor sewage
treatment and not their effluent is to blame.
In 2014, many Muslims in Uttar Pradesh
supported Modi for his development agen-
da. Now, watching their industry die, none
of those interviewed in Kanpur, tannery
owners or employees, planned to give him
their vote.
The plains turned greener and the call of
the cuckoo announced the arrival of eastern
Uttar Pradesh, where tall bamboo, teak,
and mango trees lined the highways. The
city of Allahabad, scene of the Kumbh, was
freshly painted and newly renamed: It is
now Prayagraj, returned to its Hindu roots
in October by the state’s chief minister, Yogi
Adityanath, a leading light of Modi’s BJP.
Manish Dubey, 39, a senior BJP official,
was keen to show off the roads that had
been widened for the Kumbh, which end-
ed in March.
An engineer by profession, Dubey quit
his job with Alstom SA to join the BJP and
help secure Modi’s victory in 2014. He’s
part of the team working on Modi’s reelec-
tion campaign. Modi’s appeal helped the
BJP to sweep 71 of the 78 seats it contested
in Uttar Pradesh. Dubey expects a repeat
win based on Modi’s handling of attacks in
February on Indians in Kashmir, the dis-
puted territory also claimed by Pakistan.
The arrangements at the Kumbh might
also help.
Modi chose the next stop on the river,
Varanasi, as his constituency in 2014, win-
ning with a huge majority. The seat has
been solidly BJP since 2009. Known for
millennia as Kashi to Hindus, it is one of the
most important Hindu shrines. “The city’s
modernisation before the Kumbh may
have angered a few locals, but will translate
into votes for the prime minister’s party
because it shows they can take hard deci-
sions,” he said.
Modi promised ~20,000 crore to clean
the Ganges, to be supplied from state funds
and donations from devout Hindus world-
wide. As of December, less than 20 per cent
of the ~240 crore received in donations had
been spent, according to The Wire. In a
recent report, India’s pollution monitoring
agency found the river is relatively clean in
only one of 39 locations it tested.
Vishwambhar Nath Mishra, an engi-
neer and professor at the city’s Banaras
Hindu University, is also a Brahman and
high priest at the Sankat Mochan
Hanuman temple, one of the most revered
in Varanasi. The temple foundation runs a
laboratory that tests for fecal coliform bac-
teria, science that Vishwambhar Mishra,
like his father before him, uses to press for
a cleaner Ganges.
At his sprawling home on the banks of
the Ganges, Mishra cited data showing that
85 per cent to 90 per cent of the river’s prob-
lems are caused by raw sewage disposal.
City sewers along the river’s course are the
chief culprit, with “uncontrolled develop-
ment” also a concern. “People now say that
the Ganga is cleaner,” he said. “I say her
condition has further worsened.” In reality,
“all that’s needed is that we not treat Ganga
as a dustbin.” Modi’s supporters are vocal,
said Mishra, but there’s a silent majority
that has turned against him.
Progress in Varanasi, as in Prayagraj,
means clearing the way to temples. Outside
one of the houses scheduled for demoli-
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<
tion, Nirmala Gupta, 60, stood on a heap of
rubble trying to come to terms with the
demise of the home she was married into
40 years before. She is no longer a Modi
supporter. “We never thought such a thing
could happen, that the government goes
out of its way to destroy such an ancient
neighborhood,” she said. “One day they
spoke about it, the next they turned up with
bulldozers. We’ve been living without
sewage or water connections for the last 10
days now. But they say it will make life eas-
ier for worshippers.”
Loaded coal wagons crossed the rice-
growing flatlands of Bihar along the Sone,
one of the Ganges’s biggest tributaries.
Bihar and Jharkhand are known as India’s
mineral-rich states, yet they’re among the
poorest financially. Bihar has barely 1.5 per
cent of India’s industries. Unemployment
is 11.6 per cent, compared with India’s aver-
age of 7.1 per cent; in Jharkhand, it’s 14 per
cent. Both are strongholds of the BJP or its
affiliates. As infrastructure demand grows,
developers are dredging more sand from
rivers like the Ganges and the Sone to use
for building.
Lack of work is the reason, said
Rampyari Devi, 70, sitting in the courtyard
of her mud and wood home. “Farming
doesn’t pay in India,” she said. “My hus-
band worked in Mumbai and Delhi as a
daily-wage worker for years. I raised the
kids by myself. I want to ask Modi, ‘Should
my sons and grandsons have to do the
same?’ ” To the south, on the Ganges delta,
Kolkata was India’s capital during the
British Raj but saw its importance fade as
power shifted to Delhi. Kolkata is the capi-
tal of West Bengal state, a target for the BJP
as it seeks to expand its power eastward.
The city is the most important port for
the state-owned Inland Waterways
Authority of India, and so key to govern-
ment plans to turn the lower Ganges into a
national waterway for cargo. Shipping is
cheaper than transport by rail or road. Yet
building barrages and deepening river drafts
threaten the alligators, turtles, and dolphins
that inhabit this part of the Ganges, say envi-
ronmentalists. Shipmaster Kanhai Debnath,
38, who has worked at the Waterways
Authority for a decade, sees the develop-
ment as a chance to return jobs and prestige
to Kolkata. Steering his ship down the river,
he said the authority is doing more busi-
ness under Modi. The government has
ensured the river was dredged, making it
easier to navigate. “I have no doubt that
things have gotten better,” he said.
With assistance by Evan Applegate
 https://t.me/TheHindu_Zone_official
18
>
MUMBAI | 4 MAY 2019 1

After killing 8 in Odisha, Fani hits Bengal Avengers:Endgame

beatsInfinityWar
> UPDATES

Over ~1,000 cr released

in advance for states
affected by Fani: Modi
Prime Minister
Narendra Modi
has said over
~1,000 crore
had been
released in
advance for
the states
affected by cyclone Fani. "Lakhs
of families are affected in the
coastal areas of Odisha, West
Bengal, Andhra Pradesh, Tamil
Nadu, and Puducherry. More
than ~1,000 crore have been
released in advance," Modi said
at an election rally.
AIIMS PG 2019 exam in
Bhubaneswar cancelled:
Health Ministry
The health ministry announced
cancellation of Bhubaneswar as a
centre for the AIIMS PG 2019
examination and launched a
24x7 helpline number to provide
DILIP SATAPATHY, JAYAJIT DASH, information, assistance and
NIRMALYA BEHERA & AVISHEK RAKSHIT support. The exam was
Bhubaneswar/Kolkata, 3 May scheduled on May 5. Another
exam will be conducted for those
collectionsinIndia
URVI MALVANIA
Mumbai, 3 May
Within a week of release,
Avengers: Endgame has
managed to beat the record
for the highest-grossing
Hollywoodfilminthecoun-
try. With ~266 crore in seven
days, Endgame, the last
movie in the Marvel
Cinematic Universe’s
(MCU) Inifinity Saga, has
outdone its 2018 predeces-
sor Avengers: Infinity War
(~240 crore).
Endgame was released
in 2,800 screens and was
the first-ever in India to
have 24x7 screenings in
major markets. With shows
starting at early as 3.30 am,
multiplexes and single
screenssawhugefootfalls.It
released in three Indian lan-
guages — Hindi, Tamil, and
Telugu, apart from English.
With no major release
slotted this week, the film
continues to have a clear
run and the second week-
ing weekend, joining the
ranksofmovieslikeDangal,
PK, and more recently
Sanju. These films, howev-
er, were released in at least
4,000 screens.
While the anticipation
for the film, fuelled by
Disney’s marketing efforts
has helped the film attract
footfalls and collections,
the rates for tickets for
Endgame also appreciated
by 20 per cent on an aver-
age. This was in part due to
the fact that it released it
formats like 3D, 3D IMAX,
and 3D 4DX which tradi-
tionally have a higher tick-
et price. Part of the hike in
tickets also came as a
result of the massive
demand Endgame saw in
the first two days of
advance bookings.
Online ticketing portal
Bookmyshow sold a million
tickets in a day after open-
ing bookings. According to
data provided by fintech
company 2PayLater, there

A
fter killing eight people in affected as soon as normalcy end is expected to bring in was 2x surge in bookings on
Odisha, cyclone Fani will returns, the ministry said. healthy collections as well. the day advance bookings
make a landfall in West Experts believe it will opened (as compared to the
Bengal early on Saturday. Bangladesh evacuates cross ~300 crore in the com- usual traffic).
Fani rolled through Odisha 500,000 people from
packing rain and windstorm that coastal areas
gusted up to 205 kmph after mak- Bangladesh evacuated over
ing a landfall around 8 am in Puri. 500,000 people from its
The storm severely damaged prop- southwestern districts as Cyclone
erty and public infrastructure in 13 Fani is likely to hit the country late
coast districts of the state. Deaths night and cause severe damage
were reported from Puri (3), after ravaging the Indian
Bhubaneswar (3), Kendrapara (1) Fani wreacked havoc on Odisha; commuters suffered due to train and flight cancellations coastlines.
and Nayagarh (1).
The cyclone was almost remi- poles have been ravaged in Puri melled Odisha, neighbouring West Minister Nardendra Modi’s rallies Arrangements in place
niscent of super cyclone of 1999, and Khurda districts. Restoration Bengal braced itself for the fury. in Tamluk and Jhargram have been for non-stop fuel
one of the worst calamities in the of power will take longer than we Even as seven constituencies postponed by a day. supply, says IOC
state’s history, which claimed over anticipated. In Bhubaneswar and from the state runs into the fifth Yogi Adityanath’s rally in Indian Oil Corporation (IOC) on
10,000 lives. Puri, the transmission infrastruc- phase of elections on May 6, the Jamshedpur, scheduled on Friday, Friday said it has made
Casualty was much less this ture needs to be relaid. No assess- state’s Chief Minister and was cancelled. The party’s presi- arrangements to ensure
time compared to 1999 as 1.08 mil- ment of monetary damage has Trinamool Congress (TMC) dent also cancelled three rallies in uninterrupted supply of petrol,
lion people were taken to safer been made yet,” said Hemant supremo Mamata Banerjee chose nearby Jharkhand on the same day diesel, LPG and jet fuel in Odisha
places before the cyclone struck. Sharma, secretary (energy), Odisha to monitor the situation from due to worsening weather. and West Bengal. “In the wake of
Odisha Chief Minister Naveen government. Kharagpur in the West Midnapore East and West Midnapore, both the cyclone Fani making landfall
Patnaik directed authorities to After the withdrawal of the district, a strategic location for North and South 24 Parganas, in Odisha earlier on Friday, IOC is
undertake immediate relief and super cyclone, an assessment was monitoring rescue operations. She Howrah, Hooghly, Jhargram, fully geared up and ensuring
restoration work. carried out by a team of Airports was on her way to a political rally Kolkata, and the Sundarbans are uninterrupted fuel supply from its
Also, mobile towers at many Authority of India (AAI) at in that district before deciding to likely to feel the initial impact of locations in Odisha and West
places were blown away, Bhubaneshwar Airport. The pas- cancel it and stayed back at Fani. Bengal on the east coast,” the Top Hollywood movies at
disrupting telecommunication senger terminal building has been Kharagpur. Flight operations were sus- company said.
services. “All telecom services are considerably damaged. The rooftop “Have cancelled my rallies for pended as Netaji Subhash Chandra
the Indian box office
down in Puri district,” said of ATC Tower has also been blown the next 48 hours because of what International Airport closed Voda Idea initiates AVENGERS: AVENGERS : JUNGLE
Special Relief Commissioner away, affecting VHF Antennas at could be an impending disaster down from 3 pm on May 3 to 8 am contingency measures ENDGAME INFINITYWAR BOOK
Bishnupada Sethi. the rooftop. Alternate ATC arrange- #CyclonicStormFANI. We are mon- on May 4. for Odisha subscribers
Bhubaneswar plunged into ment have been made. Based on itoring the situation 24x7 and doing Railways have cancelled Vodafone Idea on Friday said it ~266 cr ~240 cr ~186 cr
darkness as evening fell. The effect the feedback, it was decided that all it takes. I appeal to all people to over 225 trains anticipating has initiated contingency net after tax net after tax net after tax
has been catastrophic on the low Bhubaneshwar will resume com- cooperate. Be alert, take care and disruptions in operations because measures, including activating (seven days) (lifetime) (lifetime)
tension lines that feed the domes- mercial flight operation from 1 pm stay safe for the next two days,” she of the cyclone and has also put in emergency helpline number and
Note: Typically, a film's lifetime is considered 8 weeks’ run in movie
tic power consumers, an official on May 4. tweeted. place a quick-response team to free SMS, for its customers in halls Source: Industry estimates
said. As Fani, which means head of a The Bharatiya Janta Party also address any exigencies arising out Odisha. AGENCIES
“More than 100,000 electric snake and pronounced foni, pum- called off its rallies. While Prime of the cyclone.

‘Fed might Walmart International chief impressed

have to aim
for inflation
above 2%’
REUTERS
Stockholm, 3 May
The Federal Reserve might
have to aim for inflation
above 2 per cent to achieve
its 2 per cent target, a top
policymaker at the central
bank said on Friday.
“We had too many under-
shoots for quite some time.
We’re symmetric and that
means even if it’s going to go
back up to 2 (per cent),
because it's unsure, maybe
we should aim for 2.25 per
cent to get to 2 per cent,”
Federal Reserve Bank of
Chicago President Charles
Evans (pictured) said in
Stockholm.
The US Federal Reserve
held interest rates steady on
Wednesday and signaled lit-
tle appetite to adjust them
any time soon, taking heart
in continued job gains and
economic growth and the
likelihood that weak infla-
tion will edge higher.
with Flipkart’s innovations
PEERZADA ABRAR &
KARAN CHOUDHURY
Bengaluru, 3 May
E-commerce major Flipkart on
Friday said that Judith
McKenna, president and chief
executive officer (CEO) of
Walmart International, is
“impressed” with Flipkart’s
innovation to create world class
experiencesforcustomersusing
technology.
This included making a big
difference to the whole ecosys-
tem, including sellers and
manufacturers across the
country. “She is delighted to
see Flipkart excelling by lever-
aging its homegrown innova-
tions and making the most of
synergies with Walmart as it
seeks to bring the next 200 mil-
lion Indian shoppers online,”
said Flipkart.
McKenna visited India for
an internal business trip
between April 30 and
May 3 to assess the progress
made by Flipkart since acqui-
sition of the company last May
for $16 billion.
Judith McKenna (right) with Myntra head Amar Nagaram
meeting kirana partner of it’s MENSA network
Walmart, based in
Bentonville, Arkansas, is
locked in a fierce battle with
US rival Amazon for domi-
nance in India’s online retail
market.
McKenna, who interacted
with Flipkart group’s leadership
andemployees,wasalsoaccom-
panied by Richard Mayfield,
chief financial officer (CFO),
Walmart International, and
Leigh Hopkins, international
strategy and business develop-
ment head.
McKenna, along with
Kalyan Krishnamurthy, CEO,
Flipkart group, and Amar
Nagaram, head of Myntra and
Jabong, unveiled Myntra’s
first-of-its-kind service kiosk
that offers shoppers a host of
value-added services.
These include flexible pick-
up and drop, instant returns,
trial room and free alteration
of products.
The kiosks will be launched
at locations such as tech parks
and large educational institu-
tions aimed at enhancing the
online shopping experience for
customers. Myntra is planning
to launch 30 service kiosks
across Bengaluru, Hyderabad,
Delhi, Mumbai, Chennai and
Kolkata in the first phase.
McKenna also met ‘kiranas’
that are part of Myntra’s unique
Myntra Extended Network for
Service Augmentation (MEN-
SA) network.
During her visit, McKenna
also met Sameer Nigam, CEO
of digital payments company
PhonePe, and his leadership
team. At a townhall with
PhonePe staff, McKenna had
said she appreciated the work
the payments company
was doing to “revolutionise”
financial payments through
technology, according to
Flipkart.

London top choice for Indian investors: Report

PRESS TRUST OF INDIA
London, 3 May
London emerged as the top choice for
Indian investors ahead of other cities
such as Dubai and Singapore, with
investments by Indian companies in the
British capital reaching an all-time high
last year, according to a new analysis.
The UK emerged as the top most
country to attract Indian FDI with
52 projects, ahead of the US (51) and the
UAE (32), in 2018, said London &
Partners (L&P), the Mayor of London's
promotional agency, in the new analysis
released on Friday.
Indian companies choosing to invest
and expand in London reached an all-
time high last year, with 32 investment
projects — a giant leap from the previous expansion and we look forward to wel- Steeley, CEO of AccountScore, one of
year, it said. coming more companies,” said Laura the companies participating in the
“Foreign direct investment (FDI) Citron, CEO of London & Partners, who trade mission next week.
from India into London increased by will be leading a four-day trade mission Nadia Sood, founder and CEO of
255 per cent from 2017 to India from Monday. Credit Enable, another participating
to 2018. And, invest- The L&P’s trade dele- company, added: “India is bubbling over
ment into the UK from Indian companies gation, comprising some with opportunity, promise and above
India grew by over 100 choosing to invest of London’s fastest all, entrepreneurial talent”.
per cent compared with and expand in growing fintech and According to the latest data, over the
the previous year, with London reached an enterprise tech firms, past 10 years, Indian companies have
London accounting for all-time high in will cover Mumbai, added £2.49 billion in capital expendi-
over 60 per cent of all 2018, with 32 Bengaluru and Chennai ture and created over 5,691 new jobs for
Indian investment into investment projects as part of the Mayor of London’s economy.
the UK in 2018,” notes London’s International Some of India’s fastest growing
the analysis, based on Business Programme. companies have also announced
fDi Markets and fDi Intelligence data. “India and London share strengths in investments in the British capital in
“We’re delighted that a record num- financial services and technology, 2018, including taxi hailing firm Ola
ber of Indian businesses have chosen making India a natural market for our and more recently Indian hospitality
London as a base for their international international growth,” said Emma firm OYO.

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