Innholdsfortegnelse for Aug-28-16 i Business Today

On August 3, a Wednesday, the Rajya Sabha finally passed the Goods & Services Tax Constitutional Amendment Bill, clearing the path to implement the most ambitious tax reform in the country. GST has been talked about since 2006, and was introduced as a bill in the Lok Sabha in 2011, but it was stalled by the opposition parties. Even after the Modi government came to power in 2014, it has taken over two years of negotiations for the GST Constitutional Bill to clear both Houses of Parliament. If it works exactly as it is envisaged, it will bring in enormous tax transparency, cut out the plethora of tax rates, bring down tax disputes dramatically and, in the long run, make a host of goods cheaper because the overall tax burden…

10 KNOW YOUR RIGHTS WHAT: Roundtable on Implementation of National IPR Policy WHEN: 10 August, Kochi WHAT TO LOOK FOR: The objective of the event by CII will be to discuss the highlights of the National IP Policy 2016 and chart a road map for effective implementation by discussing it with all stakeholders and understanding their expectations. 10 - 11 LEADING CHANGE WHAT: National Leadership Conference 2016 WHEN: 10-11 August, Kolkata WHAT TO LOOK FOR: Leading and managing change has emerged as the biggest challenge for new-generation businesses. The CII event will help leaders visualise a response strategy and to think fast and think different in this volatile, uncertain, complex and ambiguous (VUCA) world. 12-13 SPICE IT UP WHAT: 9th International FAD 2016 Summit WHEN: 12-13 August, Ahmedabad WHAT TO…

THE UMBRELLA TAX The implementation of the GST will mark a drastic reduction in the number of taxes and levies TO BE SUBSUMED INTO GST CENTRAL LEVIES Excise duties, including the additional excise duties Additional duties of customs Central sales tax (levied by Centre and collected by states) Service tax Cesses and surcharges levied by the Centre STATE LEVIES VAT, including purchase tax Entry tax, octroi, local body tax Entertainment tax (unless levied by local bodies) Taxes on lottery, betting and gambling Surcharges and cesses levied by states NOT TO BE SUBSUMED INTO GST Customs duty, stamp duty and electricity duty Taxes on liquor (for human consumption) Taxes on petroleum products to be subsumed in the near future on the recommendation of the GST Council Source: BMR Advisors PEAK RATES…

The numbers point to a Tsunami of mergers and acquisitions. In the first seven months of 2016, 123 M&A deals were closed in India worth more than half a billion dollars. M&A activity was the highest in July when 36 such deals were cracked, shows data from Xeler8, a deal sourcing and start-up research platform. Flipkart’s acquisition of Jabong may be the latest big-ticket purchase, but this heavy shopping bag also includes Quikr devouring CommonFloor in January, Snapdeal acquiring a stake in Gojavas in March, Future Group buying FabFurnish in April, Titan Industries acquiring CaratLane in May, and ShopClues picking up Momoe in July. Look at another set of numbers and it is easy to join the dots. There is a drought — in the world of funding. A presentation…

FACEBOOK Thursday & Friday 1pm-3pm Did you know...the closer the weekend comes about the more people check out and check in to FB INSTAGRAM Monday 3pm-4pm Did you know...this is mainly due to companies posting during this time and stirring interactions PINTEREST Saturday 8pm-11pm Did you know...people have more time to sit back, relax and pin TWITTER Monday-Friday 12pm-6pm Did you know...click through rates are higher during week days and work hours Source: www.Bloguettes.com…

HUGE WORKFORCE: A mammoth 1.3 million employee base (highest in India), replete with powerful unions makes it difficult and inefficient to run OPERATING EFFICIENCY CHALLENGE: Operating ratio target of 92 looks difficult, largely because of pay and pension hikes BETTER BOOK KEEPING: Prabhu attempting to push Railways to move from cost-based accounting to accruals, not an easy task REFURBISHING STATIONS: Not taking off. Private players need more concessions DECONGESTION OF TRACKS: Two DFCs are under way, but still 492 sections need to be decongested fast PROCUREMENT EFFICIENCIES: Prabhu ensured FDI in locomotive manufacturing, but failed to convert similar opportunity for train sets NEW WAYS OF MONETISING SERVICES: PSU RailTel doesn’t plan to convert free Wi-Fi into sustainable business model. Food contracts continue to be bone of contention. Advertisement revenues are…

It’s a balmy afternoon in Delhi and Vikram Bakshi, the 61-year-old former Managing Director of Connaught Plaza Restaurants Ltd (CPRL) — the joint venture (JV) company that manages US fast food major McDonald’s operations in North and East India — is studying property sale deed documents in his corner office in New Delhi’s Jor Bagh. Bakshi, an old hand in the real estate business, knows this is not the best time to sell property. Yet, he has been selling a number of them, mostly in the Connaught Place area, for the past two years. He says it is okay to sacrifice a bit for a bigger goal. He is creating a war chest for the battle he has been fighting with McDonald’s since August 2013 when he was ousted as…

INTENSE COMPETITION: While the global ad-tech market is very large, it is highly fragmented beyond Facebook and Google, which own 40 per cent of the market PLATFORM OWNERSHIP: Unlike Face-book, Google, or Twitter, InMobi doesn’t own platforms and thus will always be at a handicap when competing for ad inventory FAILURE OF MIIP: InMobi launched its discovery commerce platform MiiP with considerable fanfare and investment last year. That optimism is yet to pay off in terms of revenues TALENT FLIGHT: A series of departures of senior leaders — from CFO to chief revenue officer to head of M&A — seems to have affected execution FUNDING PAIN: InMobi has been struggling to raise funds, even though the company claims it is not looking for the same LACK OF PROCESSES: To retain…

Luxury SUVs, too, are making a mark in India. Leading luxury carmaker Mercedes-Benz’s initial lot of GLC models were fully booked even before they hit the market in June this year. Since the GLC engine is above 2,000 cc, the Supreme Court’s order put paid to its diesel varient in the Delhi-NCR region, but the petrol variant is selling very well indeed. “We are tempted to expand well beyond the six-model portfolio we had planned, given the pace at which the demand for SUVs is growing,” says Roland Folger, CEO and Managing Director, Mercedes-Benz India. “India is the fastest growing market across Mercedes Benz’s portfolio.” Its rival Volkswagen’s luxury brand Audi initially thrived in India on its A4 and A6 sedans, but lately its Q range of SUVs — Q3,…

USING DND SERVICES APP: The app is currently available on Android. An iOS version will be launched shortly. In this app, there are four options: reporting of unsolicited SMS, reporting of unsolicited calls, complaint status, and option to check registration status. The first two options show call records and SMSes and can be manually ticked if the user receives unsolicited calls or SMSes. THROUGH SMS: Strangely, users are given two options: fully blocked category, which can be activated by sending ‘START 0’ SMS to 1909; and partially blocked category, which can be activated by sending ‘START’ SMS with one or multiple options to the same number. The users can choose to get spam SMSes related to banking, insurance, financial products, credit cards, real estate, education, health, consumer goods, automobiles, entertainment…

Jamna Auto (CMP: 176; Target Price 234) The company commands a dominant share in the Indian leaf spring business. The implementation of the GST will act as a catalyst for growth in the replacement market. Greenply Industries (CMP: 254; Target Price: 322) It has a strong presence across markets and an asset-light model. Passage of GST, revival in housing construction and greenfield expansion will drive growth. Uniply Industries (CMP 170; Target Price: 214) It is coming out of the woods with change in management and acquisition of Euro Décor’s business. Revival in housing construction, passage of the GST Bill and entry in newer geographies are expected to be growth catalysts. Garware Wall Ropes (CMP 446; Target Price: 560) It has diversified offerings across verticals and geographies. Going ahead, recovery in…

Ajay Piramal – the Trendsetter This refers to your cover story on Piramal Enterprises (The Contrarian, August 14). It was an interesting study of the history of the Piramal Group under the leadership of Ajay Piramal. In the present complex business environment – making it difficult for entrepreneurs to flourish – Ajay Piramal has become a trendsetter. His reading of the ground situation is perfect and he doesn’t have a herd mentality. Piramal’s contrarian strategies have yielded rich dividends and he has hit pay dirt in his various business ventures. His focus on financial services once again shows his business acumen. The creation of a resurgent fund is timely and the stressed asset market has potential. The formation of an information management board is a unique initiative to manage their…

The Goods and Services Tax (GST) may be a reality by next year with the Rajya Sabha passing the GST Constitution Amendment Bill on August 3. Though this is a big development considering that the country’s biggest tax reform till date was in the works for close to a decade, the nod to the Constitution Amendment Bill is just the first step and several big challenges await the Central government – finalisation and passage of the GST Bill (the Amendment Bill just changes the Constitution to empower the Centre and states to levy GST; the actual implementation will require the passage of the GST Bill), ratification of the Amendment Bill by two-thirds majority by half the state assemblies, ironing out of flaws in the Model GST law released a few…

As Anandiben Patel readies to vacate the Gujarat Chief Minister’s post, one of the major complaints against her is that she was unable to sustain the pace of the much publicised “Gujarat Model” of development practised by her predecessor and current Prime Minister, Narendra Modi. Patel did not limit herself to the exact policy priorities of her predecessor after she took charge two years ago. While she continued to patronise mega shows like Vibrant Gujarat and Modi’s other pet programmes for industrial development, she also looked at areas getting less attention in the earlier regime. Patel set aside more funds in the budget for tackling the state’s poor social development track record. The contradiction that existed while she took over was glaring. While the per capita Net State Domestic Product…

Post and Earn Microblogging and social networking website Tumblr, in a blog post, announced that it plans to introduce ads so that people can start making money from their blogs. “Tumblr is a place where brilliant, creative, funny, impossible people shape culture. Some of you have even turned your passions into jobs: book deals, music careers, paid gigs with the Creatrs program. Now, (soon!) that opportunity will be available to any eligible Tumblr poet, musician, fan artist, and misfit weirdo memelord alike,” the networking site said in the blog post. Users who don’t wish to see advertisements on their page, can turn it off by changing the settings. To make money on the site, users need to register, details of which will be provided by the company shortly. Hackerati An…

Suresh Prabhu is trying to streamline the operations of the Railway Board. The responsibilities of some key personnel have been tweaked to break the existing silos hampering the Railways. For instance, on March 21, a few days before the superannuation of Navin Tandon, Member (Electrical), Prabhu asked officers of Signals and Telecommunications wing to start reporting to V.K. Gupta, Member (Engineering). Prabhu has now ensured that Ashwani Kapoor — who took over from Tandon in March — will also be responsible for all locomotives (electrical and diesel) as Member (Traction). And in a recent August 3 order, Hemant Kumar, Member (Mechanical), has been asked to take care of all the rolling stocks as well. This is the first reform in the Railway Board — the highest decision making body of…

RAILWAYS' TOTAL DEBT WOULD BE AROUND 4 LAKH CRORE IN MARCH 2017 It’s ironic that Shri Suresh Prabhu, Minister for Railways, has been rated as one of the top five performing ministers of the Modi Cabinet by a popular TV channel. This at a time when the Railways is grappling with its worst ever existential crisis. Budget targets have turned out to be nothing more than building castles in the air. The entire budgetary exercise, which always enjoyed high credibility, has become a bit of a joke. In the year 2015/16, it missed gross traffic earnings (GTR) targets by a whopping 20,000 crore. In fact, GTR grew by a mere 4 per cent as against budget estimate of 17 per cent, and Indian Railways barely managed to meet its operating…

SMS Text: Turkish Full Body Massage With 2 beautiful Girls @1499, Single body MSSG @999/- Venaz Thai Spa Jacuzzi Rooms, Noida Sec- 18, Call: +919811643471, 919811643481 The SMS above is a sample of the tens of promotional calls and messages that most of us get on any given day. But there has been a change of late. The numbers have seen a sudden spurt, after a relatively quiet phase following crackdown by the Telecom Regulatory Authority of India, or TRAI, starting with the Do Not Call, or DNC, guidelines in 2007. These were followed by more detailed norms in 2010. TRAI has changed the regulations 17 times. To little effect. Even the DNC registry — a system under which one can register one’s number for prohibiting any telemarketer from calling…

1) Sanghvi Movers (CMP: 280; Target Price: 489) * With healthy utilisation levels of 82 per cent, revenue and profit after tax (PAT) are expected to grow at 15 per cent and 18 per cent, respectively, between 20015/16 and 2017/18. * With contribution of the wind power business rising from 36 per cent in 2013/14 to 61 per cent now, the company has planned a capex of Rs 1,300 crore. With orders fully booked, we expect good growth going forward. * Attractive valuation of nine times 2016/17 earnings per share (EPS) of Rs 31 and seven tines 2017/18 EPS of Rs 37.6 2) KEI Industries (CMP:118; Target Price: 135) * With aggressive brand building, strong volume growth, ongoing capacity expansion and strong order book, the company is likely to register…

3.6 billion is the number of Internet users, globally, as of June 2016, according to a report by internetworldstats.com. That's more than 49 per cent of the world population. QUOTE “People in villages are chanting a new slogan: Arhar Modi, Arhar Modi, Arhar Modi” – Congress Vice-President Rahul Gandhi took a break from his power naps to attack PM Narendra Modi on rising prices of pulses in Lok Sabha. “In June 2014 CPI was 6.77 and WPI was 5.66. Did FM add the two numbers? Voodoo statistics!” – Congress leader P. Chidambaram tweeted, rejecting Arun Jaitley’s contention in Lok Sabha that the UPA government left behind double digit inflation. SBI LOSES WEIGHT, FAST State Bank of India is considering relocating or shutting down 30 per cent of its 24,000 branches…

2003 Kelkar Task Force on indirect taxes suggests a comprehensive Goods and Services Tax (GST) based on VAT principle 2006 > Finance Minister P. Chidambaram proposes introduction of GST from April 1, 2010, in Budget speech for 2006/07 > Phasing out of Central Sales Tax (CST) begins with reduction in the rate from 4 per cent to 3 per cent 2007 Empowered Committee of State Finance Ministers (EC) entrusted with the responsibility of preparing a design and road map for GST 2008 > EC finalises views on broad GST structure – agreement on dual GST (Central and State GST), separate legislation, levy and administration > CST rate reduced further from 3 per cent to 2 per cent 2009 > Joint working group of officers from Central and state governments constituted…

When words fail, pictures speak. With the emergence of photo and video sharing social platforms such as Instagram and Snapchat, brands are increasingly harnessing the power of pixels. If you are a food, fashion or lifestyle brand, these platforms are the best bet for audiences seeking young and creative audiences, unlike Facebook and Twitter, which work well for brands with mass appeal. In India, Instagram has a lead; Snapchat, however, still has fewer takers. Rajiv Dingra, Founder & CEO of WATConsult, believes this could be because it is a fairly new platform. “Snapchat is a ‘for-the-moment’ medium and therefore has presence of brands that are youth-centric,” he adds. Paper Boat, a non-carbonated drinks brand from Hector Beverages, was one of the five launch partners of Instagram ads in India. The…

On March 30, 2016, two Mumbai tax officers raised a demand of 10,000 crore, which included a hefty interest component for late payment, with State Bank of India, alleging that the public sector bank had not complied with its advance tax commitments. The bank obliged the tax department on the same day, but also sent an accompanying letter detailing its advanced tax payments for the fiscal. The taxmen acknowledged the receipt of the letter, conceded their oversight (faulty record keeping) and processed the refund of `9,500 crore on April 1. In the Indian tax system, this would have gone down as ‘routine’ and not something to make a hue and cry about. However, essentially, the taxmen were playing the system to meet their collection targets for the financial year 2015/16.…

RAILWAY BOARD REFORMS: Elevated post of Chairman; ensured continuity with extension for A.K. Mittal as chairman; and started three cross-functional directorates IMPROVED CONSUMER EXPERIENCE: Free Wi-Fi, improved cleanliness, better ticketing, better food, running modern trains FASTER DECISION-MAKING ON INFRA: Prabhu takes weekly reports on dedicated freight corridor (DFC) and infrastructure projects. Project directors directly report to Mittal and Prabhu RAISING FUNDS OUTSIDE BUDGET: Prabhu stitched together capex plan of 8.56 lakh crore, with 1.5 lakh crore funds commitment coming from LIC; various projects under PPP and FDI rolled out LOCOMOTIVE PROJECTS: GE and Alstom roped in to manufacture locomotives at Marora and Madhepura, respectively…

India under Railway Minister Suresh Prabhu is not alone in reforming its mammoth Railways. The sector has undergone a major transformation in neighbouring China as well. In 2013, China dissolved its ministry of Railways. In the process, it separated policy and regulation from commercial operations. A new PSU – China Railway Corporation or CRC – was formed to run trains purely on commercial lines, whereas the transport ministry would do all the policy and planning. China is now in the league of countries like Australia, Brazil, Canada, Germany, Japan, Russia and the US, which have unitary transport ministries at the central level. Can India take a leaf out of this? Not likely. While the railway operations of the eastern neighbour are of similar scale to India’s, the issues might be…

On September 15, 2011, when Japanese firm SoftBank Group announced a $200-million investment in InMobi, celebrations broke out in the company’s then main headquarters at Embassy Golf Links, a technology park in Bengaluru. There was a palpable sense of excitement among InMobi's rank and file. An Indian company was taking on the might of the likes of Google and Facebook in the digital advertising technology space (ad tech) – a David taking on the Goliaths. The investment was a milestone. Softbank had come into the company, valuing it at a little over a billion dollars, officially making it India’s first Unicorn. A Unicorn is any private company, which has a valuation of more than a billion dollars. Cut to June 22, 2016. The US Federal Trade Commission said in a…

1.A real estate developer plans to run an SMS promotional campaign to sell his unsold flats 2. He goes to a telemarketer, who sells him 1,00,000 SMSes for Rs 10,000. Gives him a login/password to access the web panel 3. Developer logs in to the website. Types in the SMS 4. Developer loads contact numbers of potential customers to the web panel, and clicks send 5. The message goes through the telemarketer system. DND scrubber weeds out numbers registered under Do Not Call registry 6. Message reaches the inbox of non-registered subscribers showing alphanumeric number on top…

Ghosh ignores the biggest contributor to climate disruption – the fossil-fuel-based industrial agriculture system The Great Derangement: Climate Change and the Unthinkable By Amitav Ghosh PAGES: 275 PRICE: 399 Penguin Books The entry of an eminent writer in the climate change story has brought the oxygen of imagination into the air. The very title of Amitav Ghosh’s book, The Great Derangement, provides a much needed shift in focus. It refers to the collective denial of the seriousness of the crises we are living through – with climate change as one of its most serious symptoms. But it describes the planetary crisis through the human derangement, not just as a crisis “out there”. The most significant contribution that the book makes is waking the reader from the anthropocentric and eurocentric slumber…

1) Hindalco (CMP: 136.65; Target Price: 160) * Prices of aluminium and other base metals are at a decade low. Too much pessimism often leads to reversals. The company has been reporting subdued numbers, which the market has already discounted. Hindalco is a classic contra bet. It is a large diversified player with efficient operations. The moment aluminium prices pick up, the stock will deliver phenomenal returns. 2) Bajaj Finserve (CMP: 2,826.20; Target Price: 2,900) * Bajaj Finserve is the holding company for Bajaj Finance engaged in financing diversified consumer products. It primarily caters to the urban elite and middle class. While the Bajaj Finance stock has been rerated a number of times, the holding company, Bajaj Finserve, in spite of having life and general insurance businesses too, has been…