Innholdsfortegnelse for November 6, 2016 i Business Today

THE OIL PRICE CRASH HAS PLAYED HAVOC WITH COUNTRIES HEAVILY DEPENDENT ON OIL EXPORT – SAUDI ARABIA, NIGERIA, LIBYA, KUWAIT, QATAR, IRAN, IRAQ, THE UAE AND EVEN NON-OPEC RUSSIA The Organization of Petroleum Exporting Countries (OPEC) had its glory days in the 1970s when its Arab members imposed an oil embargo on select nations – including the US – which had chosen to help Israel during its 1973 Yom Kippur war with Egypt and Syria. By the time the embargo ended, the price of oil had quadrupled. For decades thereafter, OPEC, which at the time provided 50 per cent of the world’s oil, has been the key player in determining oil pricing. The scenario is so different now – with the price of oil having fallen 60 per cent in…

WE NEED LARGE VOCATIONAL UNIVERSITIES THAT FOCUS ON EMPLOYABILITY TO COMPLEMENT CURRENT SMALL UNIVERSITIES THAT FOCUS ON KNOWLEDGE AND RESEARCH The release of the Labour Bureau numbers for 2015/16 was accompanied by the usual outrage – unemployment rate was up from 4.9 per cent two years ago to 5 per cent, 77 per cent households did not have salaried or regular wage earning members, women’s unemployment rate was 50 per cent more than men, and much else. These numbers are a statistical distraction. With 90 per cent of India employed informally and 40 per cent of our labour force making enough money to live, but not enough to come out of poverty, India’s problem has not been jobs but wages. Our unemployment rate is not fabricated and almost everybody who…

In the 2014 elections, nobody tapped the public mood against corruption as well as Narendra Modi — one of whose promises included bringing black money stashed abroad back to the country and crediting each citizen’s bank account with `15 lakh. After taking over as prime minister, he found that it was easier said than done. First, in early 2015, Bharatiya Janata Party, or BJP, President Amit Shah said the 15 lakh promise was a chunavi jumla (poll gimmick). Months later, a cornered government came out with a scheme for voluntary disclosure of foreign assets. It attracted just 638 declarations, worth `3,770 crore, much less than the target, and that too mostly by those living abroad. This year, the government came out with another scheme, the Income Disclosure Scheme (IDS) —…

It ’s a hot Tuesday afternoon at Anant Honda, the largest dealer of Honda motorcycles in Gujarat’s Anand district. Yet, the showroom is abuzz. Salesperson Karan Shah says the beeline of customers for test rides hasn’t abated since the Central government announced a new pay scale for its employees. After a 20 per cent dip in sales last year, this year’s festive sales may hit a new record. “I have sold 30 bikes to government employees in the past one month, which has never happened earlier,” says Shah. The Seventh Pay Commission recommendations raised the basic salary of four million government employees and six million retired employees by 2.57 times. And One Rank, One Pension directly benefits 1.8 million ex-servicemen. Shah says Honda’s attractive 2,000 discount (3-5 per cent) scheme…

The rise in ad spends was possible because of low raw material prices, which helped companies improve their gross margins TURNING TIDE spends of most companies grew in 2015/16, while their turnovers declined Advertisement & sales promotion expenses Sales turnover Analysis based on 38 FMCG companies; Figures show year-on-year growth in %; Source: Ace Equity Despite being hammered by a slowdown in consumer demand, fast-moving consumer goods (FMCG) companies had stepped up their advertisement and sales promotion expenses in 2015/16. An aggregate analysis of 38 FMCG companies shows six percentage point growth in ad and promotional expenses to 12.4 per cent, from 6.0 per cent in 2014/15. Growth in sales turnover, however, fell seven percentage points to 3.3 per cent from 10.2 per cent during the same period. In fact,…

BAG IT OR JUNK IT: Given its performance and improved battery, the Apple Watch Series 2 is worth considering PRICE: 32,900 ONWARDS RATING: 4.5/5 One look at the Apple Watch Series 2 will have you wonder how similar it looks to its predecessor. But there are plenty of improvements and enhancements, which may compel you to consider going for an upgrade. The most basic yet important improvement is that the Apple Watch Series 2 boots up much faster than the original Apple Watch. The display brightness has been improved, making it more visible in direct sunlight. Unlike the original Apple Watch that was slightly slow in responding, the new Apple Watch impresses with its performance – be it while launching apps or accessing notifications centre. It is powered with a…

Tough Talker Vinod Rai, Banks Board Bureau Chief, recently rebuked banks for their lack of action in tackling the bad loan menace. He said that the government and RBI have created a conducive environment for lenders to clean up their books, but banks are holding back on concerns that they may be accused of favouring corporates and face corruption charges while resolving bad loans. Big Bull with a Big Heart Ace investor Rakesh Jhunjhunwala declared during an interview to a TV channel that he would donate 25 per cent of his portfolio or `5,000 crore, whichever is lesser, on July 5, 2021. “First of all, I am still not a philanthropist. I hope to be one. I am not giving so much of my wealth that I should feel I…

WHO OWNS THE INDIAN STOCK MARKET Promoters include both Indian and foreign FIIs include foreign venture capital investors, foreign portfolio investors, foreign financial institutions and foreign bodies. DIIs include mutual funds, insurance companies, provident funds and other financial institutions. Others include American Depositary Receipts, Global Depositary Receipts and shares held by custodians THE TOP 10 OWNERS Top 10 promoters of companies listed and traded on BSE owned almost 20% of the market as on June 30, 2016. -77.7% Bharat Financial Inclusion Ltd^. saw the highest percentage decline in promoter holding between June 2015 and June 2016 29.8% Ashok Leyland^ saw the largest percentage increase in promoter holding between June 2015 and June 2016 11.3% VERSUS 7.9% The average return# of 68 companies where promoters increased their stake was more than the…

EXISTING SLUMS HAVE TO BE SEEN AS BOTH THE SOURCE OF LAND FOR AFFORDABLE HOUSING AS WELL AS POCKETS OF THE URBAN SPREAD MOST IN NEED OF TRANSFORMATION TILL THE LAND IS IDENTIFIED AND ‘RESERVED’ ON THE PLANNING MAPS FOR ‘AFFORDABLE HOUSING’, THE PROMISE OF 10 MILLION HOMES BY 2034 WILL REMAIN ON PAPER Mumbai’s Development Plan (DP) 2034 has had a tumultuous history over the past 18 months, dividing urban planners, realtors and citizens’ groups sharply over its goals and perspectives. The previous 20-year plan for the world’s sixth-largest city with an estimated population of 21 million ended in 2014, and the new DP for the city for 2014-2034 was presented by the then Municipal Commissioner Sitaram Kunte in mid-February of 2015. It was a non-starter from the word…

Thirty-year-old Gautam Mandani runs a confectionary and snacks distribution business in Ranchi. When asked about the sluggish FMCG growth, he looks puzzled. “Why do you say consumption has gone down? I have been growing 10-20 per cent over the past couple of years.” His wholesale store is stacked not with brands such as Britannia or Parle, but names like Krazzy Pops, Pikado Rings, Fantasy Tops, Lot Pot, Wheels Desi Masala, etc. He claims these brands have more takers than the national brands because they are priced lower and also offer extra grams. In Vasad village on the outskirts of Anand in Gujarat, Kamlesh Patel’s grocery store prominently displays brands such as Gopal, Real Wafers and Fatlite, because they get him better margins. Sluggish growth rates are evidently limited to larger…

More dependent on rural market than car companies, two-wheeler makers have been devising new financing schemes for rural areas The festive season is here, and for the first time since 2012, auto manufacturers of all hues – especially passenger vehicle and two-wheeler makers – are celebrating. Already, September has yielded bumper sales and with the entire Navaratri period culminating in Dussehra, as well as Diwali, falling in October, this month and succeeding ones can only be better still. Manufacturers are gasping to fulfil demand. All five of passenger car market leader Maruti Suzuki’s plants in the Gurgaon-Manesar manufacturing hub are working to full capacity. The company has delayed the launch of its new compact SUV Ignis to make more Balenos and Brezzas and thereby reduce the long waiting periods for…

The days of hogging the corner table at a coffee shop for hours together armed with a laptop and cappuccino, could well be passé for the budding entrepreneur. Startups and freelancers are ditching bean bags and bar stools for chairs and desks at co-working spaces that provide a conducive launchpad for their entrepreneurial journey. Meet Om Kanwar who, after working for 15 years, left his job at Cadence Design Systems to start an online math learning platform Edugain. Strapped for cash, he decided to rent a small room in South Delhi as his office space. When he called in candidates for interviews, he ended up dodging questions about the office space and the nondescript location. Clearly, the tiny space wasn’t helping attract good talent, even though they liked the job…

Over 70 golfers teed off on Friday, October 7 at the Palms Golf Course, Lucknow for the LLOYD Business Today Pro-Am of Champions. The 18 hole championship golf course is designed by the famous UK based golf course designer Dr Martin Hawtree and is spread over an area of 200 acres. The fairways have Bermuda grass and the greens are laid out with tip dwarf grass. The course has a touch of the famous links type design with deep bunkers and large undulating greens. The water bodies and well placed fairway bunkers add to the beautiful playing conditions of the course. Played on the Stableford format with Double Peoria handicap system, the hot afternoon witnessed keen golfing action with players vying for both individual as well as team prizes. The…

“The worst period for the fish sector is over” A. Jayathilak, Chairman of Marine Products Export Development Authority, talks to Joe C. Mathew about how shrimp is driving India’s marine exports. Marine product exports dipped 10 per cent last year. How is the market growth now? We have recovered completely. We are at a 10 per cent growth rate since the past six months. I think the worst of recession is over. The worst period for the fish sector is over. We will touch $5.6 billion this year. We have set a $10-billion target for 2020. The marine export basket is heavily skewed towards shrimp. Is this way of export promotion sustainable? We shouldn’t be putting all our eggs in one basket. But it goes by market dynamics. There is…

Call it fine tuning or relaxing the bad loan resolution rules, the Reserve Bank of India (RBI) under Governor Urjit Patel has been quick to make financial restructuring for large over-leveraged corporate houses a bit easier. Within a month of taking over the reins from Raghuram Rajan, who, time and again, challenged the high and mighty for taking the banking system for a ride, Governor Patel seems to follow a pragmatic approach, as he calls it, to deal with the growing stress in the banking system. The banking money locked in stressed loans is a major worry as it is not only impacting banks’ profitability, but also eating away capital. In just three years, the gross NPAs of banks have jumped from 3.4 per cent to 7.6 per cent. The…

Ernakulam district in Kerala is a much sought-after destination for setting up branches by leading banks. Even IDFC Bank, the new kid on the block, was quick to set up an outpost. But the country's largest bank, State Bank of India (SBI), is facing a problem of plenty there. SBI’S proposed merger with Kerala-headquartered State Bank of Travancore is doubling the bank’s branches in the district to close to 200 overnight. The merger with five associate banks (plus Bhartiya Mahila bank) will bring similar challenges for SBI in major districts in the country. More so, in states where the associate banks are headquartered – Rajasthan, Karnataka, Andhra Pradesh, Punjab and Kerala. In fact, the branch gridlock is just one of the many pain points. For instance, the stressed loans of…

At many residential complexes being built in Gurgaon and Noida, Sundays see irate buyers – who have paid for flats but haven’t got them – gather to demonstrate. Some have even moved their protests to the residential premises of developers. The terrible times continue across cities for India’s real estate sector, especially in residential. Developers have run out of money, and both purchases and launches have fallen substantially. New launches in the first half of 2016/17 were down 9 per cent from H1 of 2015/16, and 54 per cent from the same period in 2013, according to real estate consultancy Knight Frank. “Except Pune and Bangalore, there is no uptick at all,” says Samantak Das, Chief Economist and National Director, Knight Frank India. Unsold inventory is highest in Delhi-NCR –…

“If the BJP comes to power, it will provide one crore jobs. With 65 per cent of the Indian population below the age of 35, the youth, struggling with unemployment, can be galvanised into a force for developing the country” Narendra Modi, at a November 2013 election rally in Agra In June 2016, Modi took the initial steps towards fulfilling his promise of creating mass jobs for the young, close to two years after taking over as prime minister. The Union Cabinet, under him, cleared a package for the textile and apparel, or T&A, sector, the second-biggest employer in the country after agriculture. The incentives were for the garment manufacturing segment, the biggest job creator in the textile value chain. The cost — `6,000 crore over three years. Will the…

Suman Chowdhury Chief Operating Officer Neha Kant Chief Revenue Officer Pankaj Vermani Chief Execut ve Officer Pankaj Vermani got inducted into the business of lingerie early. His father ran a lingerie store in Meerut’s Sadar Bazar, the town’s primary market. Around 1994, when Vermani was in standard XII, his father mandated him to spend two hours every day in the shop. “It builds character,” he told him. Mostly men came into the shop, whispered what their partners needed to his dad, who then diligently wrapped the products in a brown bag. Two decades later, the way India shops lingerie has changed quite a bit. What they buy has also changed. Vermani, in 2013, launched online private label brand Clovia, along with his wife, Neha Kant, which sells everything from backless…

The festive season is upon us and so is the annual gift exchange ritual. Thankfully, the tech world is brimming with innovative gadgets that are sure to charm your loved ones – be it the adrenaline junkie friend, the ‘forever resolving to be fit’ parents or the selfie-loving sibling. Here are 15 of the coolest gadgets for budgets of all sizes. Get wrapping and get gifting! GADGETS PRICED BELOW 4,999 GOOGLE CHROMECAST: A perfect gift for those who love to sit back and binge-watch their favourite shows with a tub of popcorn. Watching shows on Netflix and similar apps can get grander with this circular dongle, which can be plugged into a TV’S HDMI port (and USB port for power) to stream ad free content seamlessly. Once paired, tapping the…

Parmeshwar Godrej would be remembered for many of her contributions. But one of her biggest work has been in the area of fighting HIV-AIDS in India. She started her campaign against AIDS in her Heroes Project in 2004. This was at a time when India had such high numbers in HIV-AIDS, but authorities had not accepted the same. I was a student at Harvard School of Public Health in 1992, a few years before AIDS became a global problem. India needed more than just anti-AIDS medication. Parmeshwar was in the forefront of creating awareness about the disease, and getting celebrities all over the world together to help fight the disease. This included film star Richard Gere and the Bill and Melinda Gates Foundation. Today, the sustained medication by the government…