Innholdsfortegnelse for 5 November 2017 i Business Today

Star India CEO Uday Shankar revels in taking risk. He recently won the broadcast rights to India’s most expensive sports property, the Indian Premier League (IPL), with his bid of `16,347.5 crore for a five-year period. (Sony earlier had the rights for a 10-year period for `8,200 crore.) Analysts calculate that Star would need to earn `55 crore per match in order to turn a profit. But that is only one of the risks Shankar is taking currently. He plans to bring TED talks for the first time to the television platform and has reportedly contracted to pay `30 crore a week to Shah Rukh Khan to host the show. Around the globe, nobody so far has tried to turn TED into a TV programme, and no one knows whether…

Rainfall (in mm) for the period between June 1 and September 30, 2017 In a country like India that depends heavily on rain-fed irrigation, the southwest monsoon has always been critical for the agriculture sector. Conditions were relatively favourable this year (June- September 2017), leading to a cumulative rainfall that was only 5 per cent below the long-period average or LPA. Most parts of the country received normal-to-surplus rainfall while the regions with deficient monsoon rain – Punjab, Haryana, and parts of Uttar Pradesh (UP) and Madhya Pradesh (MP) – could fall back on the irrigation network. However, excess rain over the period and consequently, floods, led to huge crop loss in several states, including Tamil Nadu and parts of Andhra Pradesh, Gujarat and Rajasthan. There came a hint of…

There seems a genuine need for director education and a bit of caution before the radical step is taken Corporate India has been hit by an unprecedented tsunami: over 2,00,000 directors have been disqualified from holding the position of director in any company for five years. Even the National Stock Exchange is not certain whether this will affect continuation of such directors on positions they hold at present. If this is indeed the implication of the initiative, a massive search for new directors will ensue. The transgressions for which this radical, unprecedented and, in some instances, not wholly fair step has been taken are indeed serious! Non-filing of accounts and non-repayment of deposits. While this will make all directors more vigilant and bring about a discipline in corporate affairs, it…

The Indian economy is being buffeted by a series of crises. Economic growth has slowed down considerably. This has led to lower private investment, fewer new jobs being created and a slowdown in export growth. As if all these are not enough, even agriculture seems to have hit a trough. Much of the slump in GDP growth during the first quarter of the current fiscal to 5.7 per cent has been attributed to the impact of demonetisation last year, followed by the introduction of the Goods & Services Tax or GST this year. To understand where the economy is headed and possible future policy direction, Business Today’s Rajeev Dubey posed questions to former Finance Minister P. Chidambaram and Niti Aayog Vice Chairman Rajiv Kumar. Here are their vastly diverse views…

GALAXY OF TOP-NOTCH REAL ESTATE developers has lately descended with a bang on the affordable housing segment. Most have launched separate brands to differentiate their foray – thus Tata Housing Development Company has Tata Value Homes, Shapoorji Pallonji Group has Joyville, Mahindra Lifespace has started Happinest. Even lesser known ones like Puravankara and Mumbai’s Sunteck Realty have taken similar steps, with the former setting a wholly-owned subsidiary, Provident Housing. “There has been a perceptible shift towards affordable housing with organised players increasingly venturing into this space,” says A.S. Sivaramakrishnan, Head, Residential Services – India, at real estate services giant CBRE South Asia. Until now, most of these companies operated in the premium and luxury residential segment, building and selling houses and apartments priced between ₹50 lakh and ₹10 crore, depending…

In the digital era, successful companies are not merely delivering products or services. They are delivering experiences, built around their products and services, while quality, cost and functionality remain a ‘given’ set of considerations. The differentiator, therefore, is the experience delivered. The all-pervading digital drive is the foundation for this change, and artificial intelligence is the game changer. Let us take the case of KONE to understand how things are changing. We know that KONE manufactures escalators, elevators and automatic doors for buildings. But so do several other companies in this space. Traditionally, elevators happen to be a commodity business. What differentiates KONE today is its ‘people flow intelligence’ solutions that ensure people moving around in tall buildings do so quickly, avoiding crowding and long queues, and also do so…

BAG IT OR JUNK IT The Apple Watch Series 3 is a great first smartwatch; but works only with an iPhone PRICE: ₹29,900 onwards RATING: 4.5/5 PLUS: Fitness and heart rate tracking, Siri watch face MINUS: Works only with iPhone he Apple Watch has been a reliable smartwatch for workouts (despite competition from Fitbit bands), and now, with the Apple Watch Series 3, the company has taken it a notch higher. The one launched in India has updated features and GPS. Apple has also launched a cellular variant abroad which can receive calls and SMSes even when the iPhone is not around, but at an additional cost. It is ideal for tracking indoor walk, outdoor walk, outdoor run, outdoor cycling, indoor run, indoor cycling, workouts using elliptical and rower trainers,…

Leading with Vision: The Leader’s Blueprint for Creating a Compelling Vision and Engaging the Workforce BY BONNIE HAGEMANN, SIMON VETTER AND JOHN MAKETA PAGES:219 PRICE: ₹599 HACHETTE UK ince 2009, the ability to create a compelling vision and engaging others around it has been one of the most lacking competencies among leaders. As a result, organisations (start-ups, medium or large scale enterprises alike) ail from dull vision, uninspired employees and tepid company performance. Leading with Vision seeks to answer another equally noteworthy question – how to better engage Gen-Y. Globally, Gen-Y will comprise 75 per cent of the workforce by 2025. Gen Y’s needs from work environment are very different from that of the baby boomers. Gen-Y is digitally savvy, expect work-life balance, care about socio-environmental impact of their work…

Ashish Mehrotra, Managing Director and Chief Executive Officer, Max Bupa Health Insurance, talks to Teena Jain Kaushal and Priyadarshini Maji about rising premium rates and factors that are driving the growth of the health insurance industry in India. What is triggering the continuous rise in premium rates for policyholders? The average cost of treatment in urban India has more than doubled in the past decade. The situation is similar in rural areas. So, the premium is bound to go up. Around the world, these premiums go up regularly, annually or once in two years. Today, the insurance sector is highly regulated. But as more players come in, initiatives by the government get implemented and a structure comes into play, things will change. As insurance companies, individuals paying for the treatment…

Manoharan Varadarajan, 48, lives in Chennai with wife Vijayalavanya (39), children Nivedha (18) and Harshith (15), and Manoharan’s father and mother, aged 74 and 64, respectively. Both Manoharan and Vijayalavanya are engineers and keen to plan their finances to make sure that the family is on the right track to meet all essential financial goals linked to a comfortable retirement, children’s education and marriage, and vacations. Healthcare for parents tops Manoharan’s priorities at the moment as they do not have any health insurance. He also wants to build an education and marriage corpus for his children at the earliest. His monthly income is around Rs 2.3 lakh, but the family has inadequate health cover and solely depends on employee health insurance. They do not have an emergency fund either, which…

Serving the Useful Purpose for B-schools This refers to your special issue on India’s Best B-schools (October 22). It is a great compilation of important parameters like placement records, infrastructural facilities, and technological upgradation. The ranking process should also take into account factors like tie-ups with well known industrial houses, on-the-job training programmes, an emotional quotient versus intelligence quotient analysis through scientific evaluative tests, etc. Moreover, in today’s changing job market scenario, prompt acquisition of new skills by the students needs to be focused as well. However, some colleges have not participated in your survey. But for a country which has had a history of management education of over six decades, it is unfortunate that no Indian business school is anywhere near the top 10 global institutions measured by various…

17 18 SPOTLIGHT ON SMEs WHAT: Conference: Supply-Side Support for SMEs WHEN: October 17-18, Tokyo, Japan WHAT TO LOOK FOR: The Asian Development Bank event will analyse supply-side policies that can promote access to finance by SMEs and generally foster higher SME productivity and growth. The conference will focus on technological improvement, skill development, capital raising and infrastructure development. 19 ALL ABOUT MIGRATION WHAT: Seminar on "Global Migration and Labor Markets" WHEN: October 19, Washington, DC WHAT TO LOOK FOR: The main objective of the World Bank event is to contribute to our knowledge of the main patterns and economic impacts of labour mobility across the world. The intention is to inform and stimulate debate, support further research and policy interventions, and identify the knowledge and data gaps in this…

A LOT TO CATCH UP Private sector's project completion at a 36-quarter low; for government, it's a 15-month low. Private Vs Government Sector AN INADEQUATE PROPOSAL New investment proposals for Q2 at lowest level in 19 quarters ₹2,79,890 CRORE Value of projects dropped during Q2 of 2017/18 THE LAGGARD Private sector new investment proposals were at their lowest level in since Q3 of 2014. -64 year-on-year fall in new investment proposals in Q2 of 2017/18 44.3% Year-on-year rise in projects dropped in Q2 of 2017/18 INCOMPLETE TRUTH Investment projects completed in quarter ended September were at lowest level in 36 quarters NO MAKE IN INDIA HERE Manufacturing saw the biggest y-o-y fall (%) in 13 quarters…

Corporate India has been grappling with slowing economic growth, mounting NPAS of banks, after effects of demonetisation, among a host of other challenges. But amidst the gloom there is finally some good news. There is a healthy trend of companies steadily improving their operational efficiency, reveals an analysis of 387 companies in the BSE 500 index. The sample excludes banks and financial institutions and only includes companies whose latest data for 2016/17 is available with the Ace Equity database. It was observed that a significant number of companies saw a decline in their cash conversion cycle over the period of five and three years. To be precise, around 9 and 34 per cent companies saw a consistent decline in their cash conversion cycle over the past five and three years,…

ANIL AMBANI, Chairman of Reliance Communications (RCom), is in a tough spot with the merger of RCom with Aircel not happening. With Tata Teleservices being acquired by Bharti Airtel, RCom has emerged as the single weakest player in the Indian telecom space despite having 80 million subscribers. RCom’s revival hopes were predicated on its three-way merger deal with Aircel and MTS. That would have given the entity muscle power in spectrum holding, market share, subscriber base, and network coverage. Most importantly, RCom could have shifted a large part of its debt – `20,000 crore (including `14,000 crore of bank debt and `6,000 crore due to the government) out of its total net debt of `44,345 crore as on March 2017 – to the new wireless entity, making it look financially…

“Board appointments can at times be a mutual backscratching exercise by people who have reasons to promote each other,” says Arvind Mathur, Chairman, Private Equity Pro Partners. HE RECENT REPORT of the Securities and Exchange Board of India (SEBI) -appointed Uday Kotak Committee, alongside the two high-profile corporate battles of the past year – Ratan Tata versus Cyrus Mistry at Tata Sons in late 2016 and N.R. Narayana Murthy versus Vishal Sikka at Infosys in mid-2017 – have turned the spotlight squarely on corporate governance and, in particular, the performance of company boards. There is no doubt that there exists much more transparency and stakeholder democracy in companies now than before, thanks mainly to the new Companies Act of 2013 as well as earlier rules set by SEBI in recent…

If you are an investor who wants to play it ‘safe’ or provide ballast to strengthen your volatile portfolio or get a regular income off the capital market, you may have already considered the ‘hottest’ option of the day – corporate bonds. The stock and bond markets in India have been booming for some time in spite of a slump in growth and weak incomes. But corporate bonds saw the best traction ever between January and July this year as overseas investors rushed to snap them up due to their relatively high yields and spent a whopping R 54,000 crore in the process. Several other factors also contributed to the huge inflow, including a hike on the investment cap for foreign investors and a favourable macro environment – low inflation,…

Returns are as on 15th September’17 Equity funds are ranked on the basis of 5-year performance Fixed Income funds are ranked on the basis of 3-year performance AUM filter of minimum Rs.500Cr is applied on all the categories All portfolio related data is as of August’17 end; unless specified Returns of time-period of more than one year are annualised * As of March’17 # As of July’17 Source: Morningstar IT’S A DEAL The most competitive loan and deposit rates in the market *For the quarter ending September 2017; Source: Deal4Loans for small savings schemes, CMIE…

STAY CONNECTED WITH US ONwww.facebook.com/BusinessToday@BT_India PERSPECTIVE Why You Shouldn't Invest in Endowment Plans Endowment plans are not transparent, and thecharge structure is not declared by theinsurance companies upfront businesstoday.in/insurance-endowmentplans NEWS SBI Under Arundhati Bhattacharya:Hits and Misses Though reviving lending activities has been leftunfinished, it is worthwhile to take a look atSBI’s performance during her tenure businesstoday.in/arundhati-lendingactivities Anil Ambani to create asset-light RelianceInfrastructure with Adani Transmission deal The Anil Ambani-led R-Infra aims to bringdown its debt and focus business on leaner andselect sectors of the infrastructure business businesstoday.in/anilambani-rinfra Lupin’s Acquisition in US a Positive Move,Say Analysts Acquisition of Symbiomix Therapeutics willsignificantly expand Lupin’s branded women’shealth specialty business businesstoday.in/lupin-acquisition Chandra’s Second Surgical Strike: Tata Tele toMerge with Bharti Airtel The merger of will create India’s second300-million-customer-base company, placingnext to Vodafone-Idea businesstoday.in/tatatele-bhartiairtel Govt…

Identifying the truth is complicated,” Facebook CEO and founder Mark Zuckerberg wrote in a Facebook post last year, in the wake of the controversies surrounding the US Presidential election. Social media platforms have been extensively criticised for acting as a catalyst for the spread of fake news. Despite the brickbats, platforms such as Facebook, Google and Twitter are upping their news game. Here’s why. Newer features are being added to enhance the reading experience for users, and publishers are being lured with subscription models and reader data. Recently, Google News, which has been around since 2002, redesigned its desktop product – its first redesign in six years – to offer a cleaner interface, making browsing easier. “The new Google News interface offers more perspectives by showing more news pages on…

The festive season is on but unlike before, Sushil Aggarwal, owner of Ghaziabad, Uttar Pradesh-based Avon Modplast, a moulded plastic furniture manufacturing company has yet to see a jump in sales. Orders from rural and semi-urban parts of North India remain subdued. Capacity utilisation is hardly 40 per cent. “Consumers are confused, and sentiments are down”, complains Aggarwal. Animesh Saxena, who runs Neetee Clothing, an apparel export unit in Gurugram, Haryana says the supply chain in the apparel and textile sector is in trouble with the introduction of the Goods and Services Tax (GST) regime. “Unless urgent measures are taken, a revival of textile exports seems very difficult,” he warns. Sunil Harzai, of Noida-based Sidharth Exports, an established leather products manufacturer believes discriminative tax policies are turning the sector non-competitive.…

IT'S BEEN OVER A MONTH since Star India won the media rights for India’s most expensive sports property, Indian Premier League (IPL), for `16,347.5 crore. Chairman & CEO Uday Shankar must have given over 50 interviews to the media about his ‘expensive’ win. There is relief on his face when we tell him we would like to know about his other strategic moves too. “Let’s talk about Ted,” he smiles. From November, Star Plus plans to air the Indian version of the inspirational TED Talk series. Shankar had to make several trips to the TED headquarters in Vancouver to convince the TED Curator, Chris Anderson, that Star could recreate a similar experience on television. “You will see the same eclectic appearance and content. TED would be in a language other…

Companies have to disclose their existing layer of structures to the government by February 17, 2018 Pursuing the mission of cracking down on shell companies and curbing money laundering, on September 20, 2017, the Government of India – Ministry of Corporate Affairs policy division – has notified the ‘Companies (Restriction on number of layers) Rules, 2017’ which restricts the number of subsidiaries for holding companies. The move will bring in major ramifications in Indian corporate structures. No company is permitted to have more than two layers of subsidiaries in India, with an exception of one layer of wholly-owned subsidiary/ies. This new restriction applies to all companies – listed or unlisted, operating or non-operating – except specified companies such as banking companies, non-banking financial services, insurance companies and government companies. As…

The Fate of the West: The Battle to Save the World’s Most Successful Political Idea BY BILL EMMOTT PAGES: 257 PRICE: ∝599 THE ECONOMIST An exceptional addition to the recent spate of books and articles examining the forces that led to the election of Donald Trump and the Brexit vote is Bill Emmott’s The Fate of the West: The Battle to Save the World’s Most Successful Political Idea. Emmott, the former editor-in-chief of The Economist, constructs a comprehensive thesis of what the ‘West’ and the recent crises afflicting it really mean. The book spans a vast range of subjects from politics, finance and philosophy to international affairs. He says the West is not a geographical location, but an idea, the ‘world’s most successful political idea’ – Yuval Noah Harari may…

Shravan Subramanyam, Managing Director of Roche Diagnostics India, tells Joe C. Mathew about the business prospects offered by India’s new National Health Policy Q. How promising is the new health policy? It is very encouraging. It proposes to shift the conversation from treating illness to preventive care. We certainly need more investments at the disease-screening stage. But right now the policy is just words. Are they increasing funds to have such facilities? Are they ensuring that more patients get tested? Those are things that are not yet clear to us. We are waiting. We want to be ready when the opportunity comes. Q. Is there a shift in your business plan? Over the past few months, we have been trying to accelerate product launches in India. Our global pipeline is…

Every year, between October and December, the demand for gold rises during festive and wedding seasons. International gold prices have risen 15 per cent and hit the psychological mark of $1,300 per ounce till September 15 this year. Domestic prices rose 8 per cent to Rs 30,388 per 10 gram during the period. The difference in international and domestic prices is due to fluctuations in the rupee-dollar exchange rate. Many people buy gold during festive season. The question bothering them would be whether they will make money by investing in gold this year. Let’s first look at factors that are driving up prices. GEOPOLITICAL TENSION Gold is considered a safe-haven asset. Its demand rises during periods of economic/political uncertainties. Geopolitical worries have escalated due to North Korea’s nuclear tests. The…