Innholdsfortegnelse for 10-Mar-19 i Business Today

TOP-PERFORMING CEOs come in all shapes and sizes and personalities. There are the highly gregarious extroverts who love talking and interacting with employees, customers, shareholders and industry peers. Then there are others who prefer to keep themselves away from the limelight and say no to many public engagements. And though they all work exceptionally hard, their work hours and habits vary widely. Many tech CEOs take pride in getting up at 4.30 am, starting the workday at 5-5.30 am, and then working till late in the night. Tim Cook of Apple and Elon Musk of Tesla are both known for their insane work hours. Equally, the billionaire business magnate from Mexico, Carlos Slim Helu, and his British peer, Richard Branson, have been advocating three- or four-day work weeks, pointing out…

IS THE NEW TRAI regulation on TV channel pricing really consumer friendly? Ostensibly, the intent was transparency in the television distribution eco-system and allowing consumers to pay for what they watch. The very first week, cable TV networks discarded pay channels in Tier II & III markets, and left consumers wondering whether it was worth the effort to draw up their own subscription lists and call the cable operator. Ironically, broadcasters, for their part, had been aggressively promoting their respective bouquets for over a month. For instance a consumer who buys multiple Star Plus a-la-carte channels would pay ₹19 per channel while a basic Star package with its standard definition channels costs only ₹45 – making the bouquet a more cost-effective option if the person wants more than two…

IN STARK CONTRAST to fraud-hit Satyam, a solution for the Infrastructure Leasing and Financial Services (IL&FS) case will take some months. There are a staggering 348 entities under the IL&FS umbrella – a three-tier structure of a holding company, subsidiaries, and hundreds of Special Purpose Vehicles. The total loan staring at a default comes to ₹91,000 crore and there’s no resolution in sight even four months after the government took control. Unloading assets is difficult, as bidders simply aren’t offering good prices. There are concerns about presenting a true and fair picture of the group’s assets and liabilities. And, now, the government is trying a more clinical approach dividing assets based on their ability to meet payment obligations. This valuation or pricing will be critical to the eventual solution. But…

IS AIR INDIA up for sale yet again? Some reports say the government is considering divesting stake in the national carrier and plans to float an Expression Of Interest (EOI) by mid-2019. Documents from the Interim Budget show that the government earmarked just ₹1 lakh for Air India’s 10-year Turn Around Plan (TAP) approved in 2012 by UPA-II. Instead, a larger share - some ₹3,900 crore – will go towards Air India Asset Holding Limited (AIAHL), a Special Purpose Vehicle set up to transfer some of Air India’s ₹55,000 crore debt. Allocating money for an SPV but not the TAP s is probably indicative of the government’s line of thought. The Modi-government, however, failed to get rid of the ailing Maharajah last year and one wonders how it will market the…

IN THE SMALL VILLAGE of Chatrel in Rajasthan, women are upset and angry. Some of them found that their faces had been morphed on nude bodies and the photographs were uploaded on Facebook and Instagram. Villagers queued up outside the local police station seeking redressal. But what puzzled the victims most was that how their snapshots could be accessed, misused and circulated on social media in that way. India has the largest number of first-time netizens, a whopping 17.8 crore, according to the UN Conference on Trade and Development report titled Measuring the Evolving Digital Economy. A Boston Consulting Group report also states that half of India’s Internet population will be from rural areas, places where there is not just rampant illiteracy but also low digital literacy, which could become…

“TO BE SUCCESSFUL IN WHAT I DO AND TO THE BEST OF WHAT I CAN DO” In September last year, Wipro announced a $1.5-1.6 billion deal with Alight Solutions, the largest ever deal in the history of the company. It was nearly after four years that Wipro got back to the billion dollar-deal table. For a company with current market capitalisation of over ₹1.68 lakh crore, the third largest among IT services companies in India, the beginning lies with a man who became the chairman of the company forced by circumstances. Nearly half a decade ago, the untimely death of his father forced Azim Hashim Premji, who was then at Stanford pursuing engineering, to abruptly leave his studies and return to India. Taking over his family’s vegetable oil business at…

BEST CEO LARGE COMPANIES Total Income/3-yr CAGR ₹81,907 cr/17.2% PBIT/3-yr CAGR ₹11,349 cr/30.8% PAT/3-yr CAGR ₹7,722 cr/27.7% 3-yr Average TSR 38.1% Average Mcap YOY Growth* 37.2% ROE/ROCE 19.8%/28.8% Cash/Debt ₹71 cr/ ₹111 cr Net Profit Margin 9.4% *For Oct 2017-Sep 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity Even by his own high standards, 2017/18 was a stellar year for 64-year-old Kenichi Ayukawa, the top boss at India’s largest passenger vehicle maker, Maruti Suzuki. His company closed the year with 50.1 per cent market share, the highest since 2000/01. The significance of this cannot be overstated. Maruti’s hold over the domestic market is unprecedented. Under Ayukawa, its grasp of the consumer psyche has only strengthened. No other market leader…

The phenomenal growth of the Rs.8000 crore worth company is propelled by the core values of honesty, transparency, commitment, quality assurance and customer satisfaction, besides an expansive network of over 10,500 dealers/distributors across the country. Among its premium products are earthquake resistant Kamdhenu SS 10000, TMT Bars and Kamdhenu NXT, "the next generation interlock steel". The own full-fledged steel and paint factory in Bhiwadi (Rajasthan) form the backbone of the company, which diversified into decorative paints in 2008. Kamdhenu is the proud recipient of several honors including "India Power Brand 2016 Award", "Asia’s Most Promising Brand-2015-16", "World’s Greatest Brand 2015 and 2017-18" amongst Asia &GCC in the categories of steel as well as paints. An ISO 9001:2015 certified company, Kamdhenu is also listed on BSE & NSE. Reiterating the company’s…

“NEWER CATEGORIES MEANS BRITANNIA WILL NO LONGER BE A BISCUIT-ONLY COMPANY. IT HAS INVESTED ₹1,500 CRORE ON AN INNOVATION STRATEGY” BEST CEO FMCG Total Income/3-yr CAGR ₹9,460 cr/9.2% PBIT/3-yr CAGR ₹1,447 cr/24.9% PAT/3-yr CAGR ₹948 cr/25.4% 3-yr Average TSR 32.6% Average Mcap YOY Growth* 54.2% ROE/ROCE 32.7%/49.7% Cash/Debt ₹97 cr/ ₹10 cr Net Profit Margin 10.1% *For Oct 2017-Sept 2018; Standalone data; Total Income, PBIT and PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity Varun Berry, the tall and lanky MD, of the 100-year-old biscuit manufacturer, has tall ambitions — to make Britannia a complete foods company by 2020. He says 2018 was a year of innovations. The biscuit manufacturer launched a host of new products such as milkshakes, chocolate-filled cakes and wafer biscuits, all of…

“TECH M WILL BE DIGITAL INSIDE AND DIGITAL OUTSIDE.” BEST CEO IT AND ITES Total Income/3-yr CAGR ₹25,513 cr/9.1% PBIT/3-yr CAGR ₹4,977 cr/19.5% PAT/3-yr CAGR ₹3,999 cr/22.1% 3-yr Average TSR 7.4% Average Mcap YOY Growth* 39.6% ROE/ROCE 22.5%/25.3% Cash/Debt ₹1,929 cr/ ₹255 cr Net Profit Margin 16.9% *For Oct 2017-Sept 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity The Satyam scam which surfaced in 2009 was an unheard of corporate fiasco for the Indian IT industry until then. When Tech Mahindra won the bid to acquire the beleaguered software company, which was the fourth largest software exporter back then, Chander Prakash Gurnani’s career was about to take a giant leap. The then Managing Director Vineet Nayyar and Mahindra group…

“GRID BALANCE IS ONE OF THE MOST CRITICAL ELEMENTS… WE REQUIRE EFFECTIVE EVACUATION OF ELECTRICITY AND PROJECT EXECUTION” BEST CEO PSU (EX-BFSI) Total Income/3-yr CAGR ₹30,974 cr/19.9% PBIT/3-yr CAGR ₹18,068 cr/12.4% PAT/3-yr CAGR ₹8,239 cr/18.3% 3-yr Average TSR 14.6% Average Mcap YOY Growth* -0.7% ROE/ROCE 16.8%/10.4% Cash/Debt ₹2,170 cr/ ₹1,31,213 cr Net Profit Margin 27.7% *For Oct 2017-Sept 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity When he was sworn in as a member of the Central Electricity Regulatory Commission, on January 21, 2019, Indu Shekhar Jha made history in the annals of India’s power circles. Just hours earlier, he had relinquished charge as Chairman and Managing Director of Power Grid Corporation of India (PGCIL), nearly four months before…

Journey of Dr. Arvinder Singh is proof and validation of the above statement. Born in a middle class family, he suffered from polio with 80% disability during his childhood. Yet, despite all odds, his achievements are numerous and diverse. He is an MBBS, MD (Gold Medallist) and the only postgraduate doctor in India to have received a gold medal for his MBA from IIM (Indore). He holds a diploma from Oxford University (UK). He is pursuing his law courses from National Law University, Bangalore. He also has a special interest in Alternate Dispute Resolution (ADR) which involves facilitating out of court settlements. He is a certified Commercial Grade Mediator, Business Negotiator and Arbitrator. He recently published a book "Doctors and Law", focusing on rights and duties of healthcare professionals and…

To the casual eye, nothing could be sweeter than Prime Minister Narendra Modi’s letter to 75 million households in seven different languages in the last four months. The attempt was to reach out to the underprivileged — some 100 million families or about 500 million Indians who are included in the Socio-economic and Caste Census list of 2011 — and tell them about the ₹5 lakh worth of medical treatment each of these families is entitled to every year through the Centre’s new flagship health insurance scheme: “Prime Minister Jan Arogya Yojana (PM-JAY) – Ayushman Bharat”. The letter also reminded them about other big social welfare measures initiated (or re-branded) by the current government to improve the living conditions of India’s poor and how the prime minister, with his personal…

IN THEIR RESPECTIVE JOURNEYS spanning over seven decades, Tata Motors and Mahindra & Mahindra – two of India’s biggest and strongest home-grown automobile companies – have often found themselves staring at each other in the face. At the height of the craze for diesel vehicles in the domestic market in 2013/14, Mahindra outstripped Tata to become the third-largest player in the highly competitive passenger vehicle segment. The government’s fuel pricing policies helped Mahindra – a ₹24-per litre gap between diesel and petrol fuelled demand for diesel-powered SUVs, helping the company at the cost of Tata. It coincided with a period of prolonged slump for Tata and for some time, Mahindra remained head and shoulders ahead of its compatriot. The tide has turned. The diesel bull run has ended – a…

JOB TITLES DON’T usually generate much excitement. They’re printed on business cards, emblazoned on LinkedIn pages, and used in formal introductions. Some organisations, however, see them as a chance to get creative. Consider Disney, which calls its theme park workers “cast members” and its engineers and multimedia experts “imagineers”. Subway’s line workers are “sandwich artists”. At some companies, receptionists are “directors of first impressions” and PR people are “brand evangelists”. It would be easy to dismiss retitling as a silly exercise in euphemisms. But over the past decade, London Business School Professor Dan Cable has come to view it as a legitimate tool for improving workers’ attitudes and boosting recruitment. “The traditional view of job titles is that they’re about standardisation and benchmarking,” he says. “But titles often send the…

THE FUTURE OF VIRTUAL reality (VR) is not certain as the technology is yet to be used for mainstream applications. Although one can browse Facebook and YouTube in VR, this required many experiments with the technology, headset and other accessories. But this time, American auto giant Ford has decided to try and design cars in augmented reality (AR) and virtual reality settings. The company is using a suite of tools called Gravity Sketch that enables users to develop design ideas in 3D instead of creating traditional 2D sketches and converting them to 3D models, all of which takes a lot of time and efforts. The Ford team was able to create a design in a mere 40 hours using this software. London-based Gravity Sketch was among the first companies to…

Q. The biggest challenge you faced in your career A. Our film business started in 2011 but did not do well for two-three years. So, we refined our slate and entered the projects at the storyboard stage. We also brought back the marketing investment concept and made it more targeted to measure a film’s performance. We now try and predict the first weekend of our film and all our marketing is geared towards the targeted weekend. We have become profitable over the past three years. In fact, this business is helping the overall Viacom 18 portfolio deliver robust growth when the ad environment is tight. Q. Your best teacher in business A. The person who has influenced me most is former president A.P.J. Abdul Kalam. In his book titled The…

STAY CONNECTED WITH US ON www.facebook.com/BusinessToday@BT_India PERSPECTIVES Why Sterling Holidays Is Pivoting Its Business Sterling looks at expanding its offering beyond food and accommodation, catering to holiday customers in a more focussed way businesstoday.in/sterling-strategy RBI Policy Preview: May Be Right, But Not Perfect Conditions to Cut Interest Rates The RBI has already changed the inflation projections six times. And inflation should be low and stable for a long time for a cut in interest rates businesstoday.in/rbi-inflation Who Will Buy ZEE? Zee Entertainment is desperate to sell its stake. The names doing the rounds are Comcast and Tencent. Who is going to have it? Only time will tell. businesstoday.in/zee-stake.sale NEWS Loan Default Concerns Loom Large over Real Estate To meet debt obligations, developers need to increase their EBDIT by 1.92 times. And to make…

WITH NOTHING in the Budget and the country headed for elections, an unpredictable regime for Indian pharma could hurt long-term investments in the sector, say industry representatives. Speaking to Business Today, D.G. Shah, Secretary General of the Indian Pharmaceutical Alliance – which has leading Indin pharmaceutical companies as its members – sees problems on three fronts: pricing, regulatory and exports. Pricing – no clarity on what will be covered by the price control mechanism; On the regulatory side, unpredictability through sudden decisions such as the ban on manufacture of oxytocin injection and allowing only Karnataka Antibiotics to make it; Exports – not enough done to help firms deal with globally emerging tariff and non-tariff barriers. “The United States of America is reviewing inbound duty free access for certain products…

E-commerce giants Flipkart and Amazon are putting up a brave face despite the havoc the changes in the Foreign Direct Investment policy wreaked on them. The new controlled regimen, according to CRISIL estimates, has meant that e-commerce companies could lose nearly 35-40 per cent of e-retail sales, and revenues of around ₹35,000 - 40,000 crore. At the outset, Amazon appears at a disadvantage since it owns equity in Appario and Prione – its biggest sellers. Both firms are busy restructuring vendor sourcing, discounting strategy, and investments in step-down companies to ensure compliance. Ambiguity in clarification PN2 (the policy change notification) has left several grey areas, especially about whether these firms are permitted to use capital instruments to own a part of seller companies. But with Reliance planning to enter the…

HAVING CLAIMED the dubious distinction of featuring among the worst ranked banks in India, the IDBI Bank now has a new owner – one with deep pockets. The behemoth Life Insurance Corporation of India is now the new promoter for this bank whose NPAs are among the highest in the country. LIC’s entry does address the capital issue but there are bigger problems to sort out. First, higher provisioning, and faster recovery to clean up the NPA mess. The bank needs to sell its non-core assets to generate additional capital while it focuses on the banking business. Whatever the entity’s new name, the LIC-IDBI Bank will have to drastically reduce its reliance on infrastructure and other corporate assets, scale up its retail advances from the existing 43 per cent, and…

BUILDING BLOCKS WHAT: The Blockchain Day WHEN: March 12-15, Bengaluru WHAT TO LOOK FOR: An estimated 500-1,000 delegates and 10-50 exhibitors will attend the conference to deliberate on challenges and opportunities in the blockchain space. Already, financial institutions such as banks and stock exchanges are exploring the scope of this technology while regulators are keeping a close tab on recent developments and their impact. GO GLOBAL WHAT: Go Global Trade & Investment Forum WHEN: March 12-13, Delhi WHAT TO LOOK FOR: The summit will bring together senior executives from India’s medium and large companies keen to expand their businesses internationally. It will also host interactive seminars and provide one-to-one networking opportunities. ENGINEERING SUMMIT WHAT: India Engineering Sourcing Show WHEN: March 14-16, Chennai WHAT TO LOOK FOR: Organised by the Engineering…

“RELIANCE RETAIL RANKS AMONG THE WORLD’S TOP FIVE FASTEST-GROWING RETAILERS.” BEST CEO CHAMPION OF CHAMPIONS & SUPER LARGE COMPANIES Total Income/3-yr CAGR ₹2,98,299 cr/-4.1% PBIT/3-yr CAGR ₹50,381 cr/16.5% PAT/3-yr CAGR ₹33,612 cr/13.9% 3-yr Average TSR 29.1% Average Mcap YOY Growth* 50.8% ROE/ROCE 11.1%/12.2% Cash/Debt ₹2,731 cr/ ₹1,16,881 cr Net Profit Margin 10.7% *For Oct 2017-Sept 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity The right decisions are always the toughest to make. Billionaire Mukesh Ambani took almost three years to make up his mind about investing in telecom business in 2010. It took another six years to design and build the digital ecosystem for the disruptive foray of Reliance Jio with 4G. India’s most profitable company, Reliance Industries (RIL),…

“NOT ONLY DO THEY (CUSTOMERS) WANT TO BUY A GOOD PRODUCT, THEY WANT TO BUY FROM A GOOD COMPANY” BEST CEO MEDIUM COMPANIES Total Income/3-yr CAGR ₹15,708 cr/9.5% PBIT/3-yr CAGR ₹1,710 cr/14.6% PAT/3-yr CAGR ₹1,255 cr/15.1% 3-yr Average TSR 43.0% Average Mcap YOY Growth* 84.9% ROE/ROCE 24.5%/34.1% Cash/Debt ₹612 cr/nil Net Profit Margin 7.4% *For Oct 2017-Sept 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity If Xerxes Desai was the visionary behind the stylish Indian watch brand, Titan, it is Bhaskar Bhat, Managing Director, The Titan Company, who is crediting with ensuring that brand Titan is available through the length and breadth of the country. While former-MD Desai envisaged Titan as an aesthetic accessory that would adorn the wrists…

“NO COUNTRY IN THE WORLD HAS GONE FROM EURO IV TO EURO VI IN THREE YEARS. IT TOOK 8-10 YEARS IN OTHER COUNTRIES” BEST CEO AUTO & ANCILLARIES Total Income/3-yr CAGR ₹26,438 cr/24.5% PBIT/3-yr CAGR ₹2,375 cr/47.8% PAT/3-yr CAGR ₹1,575 cr/88.8% 3-yr Average TSR 33.8% Average Mcap YOY Growth* 46.1% ROE/ROCE 23.7%/28.7% Cash/Debt ₹1,004 cr/ ₹1,002 cr Net Profit Margin 5.8% *For Oct 2017-Sep 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity Vinod K. Dasari, Managing Director and Chief Executive Officer of India’s second largest commercial vehicle manufacturer, Ashok Leyland, is a content man. The results of past three financial years show the result of his and his team’s hard work and risk-taking ability. For the first time, the…

The list of top grosser includes products like ENO (GSK); Pepmelt and Pepfiz (Sun Pharma); Pudin Hara, Lemon Fizz, HoniTus Day &Night (Dabur); Digene FastMelt (Abbott), I-pill 21 days (Piramall; Paracip 100ml IV (Cipla) and many more. At present, Akums has built substantial global presence and endeavour to export their unique formulations around the world while redesigning global healthcare towards a happier world. Together, under the aegis of their father Mr. D.C. Jain, Sanjeev and Sandeep Jain have carved a unique place for themselves in the pharmaceutical space. Akums has nine manufacturing facilities, out of which eight are located at Haridwar and ninth dedicated facility is in Guwahati. The nine units and the products they are dedicated to are as follows: Unit 1-Oral solid dosage forms Unit 2-Liquid orals Unit…

“THE COMPANY (JSW STEEL) WILL CONTINUE BUILDING STEEL PLANTS AT NEARLY 50 PER CENT COST COMPARED TO COMPETITORS” BEST CEO METALS & MINING Total Income/3-yr CAGR ₹65,188 cr/11.8% PBIT/3-yr CAGR ₹10,900 cr/18.5% PAT/3-yr CAGR ₹4,859 cr/23.8% 3-yr Average TSR 50.9% Average Mcap YOY Growth* 56.3% ROE/ROCE 17.8%/16.8% Cash/Debt ₹601 cr/ ₹36,519 cr Net Profit Margin 7.0% *For Oct 2017-Sep 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity Every time a crisis strikes, Sajjan Jindal scouts for an opportunity in it. When many of his industry rivals have lost their steel businesses due to high debt, Jindal has emerged as a strong contender for the distressed assets. In the past, he bought the insolvent Monnet Ispat and is currently waiting…

Everything is seemingly fine, but there is a sense of unease. Everybody seems to be geared up for tomorrow, yet there is a nagging disquiet that something is amiss. This paradox has been the one constant in most of my conversations with CEOs in the past six months. The sentiment echoed across the board, as captured in PwC’s 22nd Global CEO Survey, launched in Davos at the World Economic Forum last month. While 42 per cent of global CEOs still expect growth to happen, nearly 30 per cent are projecting a decline. What is the basis of this curbed confidence? The survey reveals three important trends: With trade conflicts, political upsets and a projected slowdown in global economic growth, there has been a marked increase in uncertainty, which is reflected…

Why did you try self-created titles? We faced challenging situations, working with families whose children had serious health issues. I was looking to do something fun that would give employees a sense of control. People kept their traditional titles, but everyone created an additional, fun title. I became “the fairy godmother”. Our finance director became “the minister of dollars and sense”. The office manager became “the keeper of keys,” from Harry Potter. I used both titles on business cards and in e-mail – I put the supplemental title in italics. What did it accomplish? Creating new titles gave people a way to describe how they felt about the job. It gave them ownership of their role. The new titles often became a conversation starter with external people – they’d ask…

OVER THE PAST two-three years, AI-enabled machines have beaten humans time and again whenever there has been a breakthrough – be it the system teaching itself the rules of the game or upskilling itself to win exceptionally complex thinking games like Go or developing the strategies needed to overcome tricky obstacles to reach a goal as in Montezuma’s Revenge. Recently, there has been another development – a robot has managed to play Jenga with the greatest of expertise. Jenga is a game that looks deceptively simple, but you need to be extremely careful. It features a tower of 54 blocks (each has a different shape), and players need to extract the pieces without letting the tower fall. Built by the MIT (Massachusetts Institute of Technology) Media Lab, the Jenga-playing robot…

IN THE ERA of digital cameras, smartphones and image-sharing platforms, printing photographs is an old-school practice. But you will still find some niche printing solutions and holding the hard copies would take you on a journey down memory lane. HP’s Sprocket Plus is an upgraded version of the original Sprocket and comes with some exciting features. Portable and compact, this one is slightly big (141.9 mm/5.59 inches) but quite thick (17.8 mm/0.71 inches) compared to iPhone XS Max. It houses minimal controls – just a power button and a microSD slot (for charging) on the right panel and a slot for printouts at the bottom. Setting up the Sprocket Plus was a delight. After installing the printing sheets as instructed (upside down) and switching on the device, I had to…

WHAT CAUSES Alzheimer’s? Amyloid hypothesis is a popular theory that says how two types of proteins – amyloid and tau – could be the source of the problem. But newer studies and findings are emerging as well. For instance, a recent article in the New Scientist says, “Compelling evidence that the condition is caused by a bacterium involved in gum disease could prove a game-changer in tackling one of medicine’s biggest mysteries, and lead to effective treatments or even a vaccine.” According to Dr Shah, there are several theories out there – be it the mitochondrial cascade hypothesis highlighting a gene-related trigger or death of nerve cells due to toxicity of protein deposits. “It is still early stage, and there is no conclusive evidence,” he points out. Even then, researchers…

FIRST, IT WAS A ‘farmer-friendly’ Interim Budget, and now clearly, the Reserve Bank of India’s new Governor, Shaktikanta Das has stepped up. Betting on a benign inflationary scenario, the RBI expects the Consumer Price Index (CPI) or retail inflation to remain below 4 per cent in 2019. Based on the lower inflation outlook, the Monetary Policy Committee (MPC) decided to reduce the repo rate by 25 basis points to 6.25 per cent; and given the inflation trajectory, there may be another cut this April. Domestic economists and global observers alike were surprised by this rate cut since they expected a ‘hold’. While the move certainly supports growth, the RBI’s inflation projections are quite optimistic. To begin with, the RBI has been consistently missing its inflation projections for the past one…

MORE STRINGENT CAR safety norms that kick in between July and October this year in India will mean the end of the road for a number of older nameplates including Maruti Omni and Gypsy, Tata Nano and Safari, and Mahindra Xylo. New norms mandate that every car is fitted with a driver side airbag, speed warning system, seatbelt reminder, rear parking sensors and better structural stability to with stand crash test norms. These cars would then be unviable. With the exception of the Omni, among the oldest running cars in India, which continues to sell in decent numbers, most manufacturers have opted out of up-grading other cars due to poor sales. The safety norms will also herald the gradual collapse of the Fiat brand in the country as the Turin-based…

THE INDIAN STOCK market is staring at a $1 billion question! India may see this aggregate outflow if global index provider MSCI changes its methodology to compute Foreign Ownership Limit (FOL). India’s weightage in the MSCI Emerging Market index will reduce from 8.78 per cent to 8.55 per cent. Presently, the MSCI counts shares in Depository Receipts (DRs) and domestic free-float shares when calculating the weight of a company on its indices. But DRs are not liquid for the most part, and foreign investors prefer buying shares directly from the domestic market. The MSCI now proposes to exclude DRs when calculating FOL, which experts say is logical. Moreover, this will bring MSCI on a par with India’s new norms where the RBI and the SEBI consider DRs as part of…

INDIA’S REAL ESTATE story is struggling to survive in the face of bankruptcy and debt default. While all cost heads – land, construction and finance costs shot up in the past 12 years, profit margins have nose-dived from 37 per cent in 2007 to 15 per cent now. Over 93 lakh houses are lying unsold in India’s top eight cities, and another 23 lakh are behind schedule. Most banks stopped lending to developers some years back and NBFCs are pulling away after the IL&FS debacle. The twin shocks of demonetisation and GST introduction also battered this sector. For the once hot housing market, nothing seems to be going right at the moment. It is clear that for the sector to survive, someone will have to take a haircut.…

BB&T TO BUY SUNTRUST FOR $28 BN In one of the biggest bank mergers in the US since the financial crisis, BB&T, headquartered in Winston-Salem, North Carolina, will take over SunTrust, based in Atlanta, Georgia, in a $28 billion deal. The combined entity, with locations mostly in the south-east US, is valued at $66 billion. After the merger, BB&T-SunTrust will become America’s sixth-largest bank by assets, at $440 billion. The two banks say they will save 13 per cent of costs. Although the US has more than 5,000 banks, there are very few Big Banks at this time, and this merger could trigger a healthy competition in the space. Similar deals could follow as lenders take advantage of looser regulations and bulging cash reserves. Only last year, regulations were tweaked…

India may have improved dramatically in its ease of doing business, but most corporate chieftains in the country will tell you that the last four years have been particularly challenging. They had to deal with two enormous domestic disruptions – the midnight demonetisation in November 2016, followed by the rollout of the Goods and Services Tax (GST) in July 2017. There were also other issues like the rise in both public sector bank non-performing assets as well as corporate bankruptcies across sectors, which meant that only the best run businesses could access funds at reasonable rates. Most banks turned excessively cautious when it came to corporate loans. In fact, the last three years have seen the decline of some of the biggest names in Indian business because of a host…

■ How did the idea or concept of TCIExpress emerge? TCIEXPRESS is a natural evolution of the companies using transportation from point-to-point and now to hub and spoke system, a solution for time definite express deliveries across India. With the emergence of GST. everyone expected on time deliveries with multiple destinations at one go. All customers started getting time savvy. ■ What makes TCIExpress unique in its industry? TCIEXPRESS is a market leader in time definite door-to-door deliveries with containerized vehicles. Our matchless expertise in the industry has won tremendous good will of customers leading to the phenomenal growth of the company. Listed as a leading company on NSE and BSE, I feel proud to say that the company’s growth in business revenue and in market capitalisation is one of…

“THE COMPANY IS LOOKING AT BOTH ORGANIC AND INORGANIC GROWTH, APART FROM DIVERSIFICATION INTO RELATED ACTIVITIES” BEST CEO SMALL COMPANIES Total Income/3-yr CAGR ₹2,851 cr/16.8% PBIT/3-yr CAGR ₹632 cr/51.6% PAT/3-yr CAGR ₹416 cr/53.2% 3-yr Average TSR 105.7% Average Mcap YOY Growth* 105.6% ROE/ROCE 54.9%/83.3% Cash/Debt ₹13 cr/Nil Net Profit Margin 14.7% *For Oct 2017-Sep 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity Human hair and shrimp feed seem to have little in common but Alluri Indra Kumar, a chemical engineer by training, tapped a linknode, and quite a big one at that. This opened up a business opportunity that started a bold new phase in his entrepreneurial journey. The opportunity presented itself in 1991 after the government opened up the…

“THE COMPANY IS EXPECTED TO TOUCH 45 MTPA. THE EXPANSION MAY NOT PROVE CRAZY IN THE END AS THERE ARE ALREADY SIGNS OF REVIVAL” BEST CEO CEMENT Total Income/3-yr CAGR ₹10,222 cr/14.8% PBIT/3-yr CAGR ₹1,962 cr/52.2% PAT/3-yr CAGR ₹1,384 cr/44.2% 3-yr Average TSR 14.7% Average Mcap YOY Growth* 2.3% ROE/ROCE 16.7%/18.4% Cash/Debt ₹121 cr/ ₹3,403 cr Net Profit Margin 13.6% *For Oct 2017-Sep 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity The man who once gauged his mental faculties by religiously taking the annual Common Aptitude Test for MBA aspirants says crazy is good. In fact, to Hari Mohan Bangur, Managing Director, Shree Cement Ltd., crazy spells “better”. “Any company that wants to improve has to do something new,…

“THE COMPANY HOPES TO DIVERSIFY BEYOND THE US AND NEARLY DOUBLE THE REVENUE FROM THE DOMESTIC MARKET OVER THE NEXT THREE YEARS” BEST CEO PHARMA & HEALTHCARE Total Income/3-yr CAGR ₹2,131 cr/43% PBIT/3-yr CAGR ₹902 cr/65.3% PAT/3-yr CAGR ₹698 cr/60.8% 3-yr Average TSR 27.5% Average Mcap YOY Growth* 14.1% ROE/ROCE 29.2%/34.6% Cash/Debt ₹172 cr/ ₹173 cr 33.1% Net Profit Margin *For Oct 2017-Sept 2018; Standalone data; Total Income, PBIT & PAT net of extraordinary items; TSR: Total shareholder returns; Source: ACE Equity V.C. Nannapaneni Chairman and Managing Director of Natco Pharma, prefers to stay in the background and lets his son and the Vice Chairman and CEO, Rajeev Nannapaneni, to take charge while he mentors, urging all to singularly focus on product development. He sees no reason to worry thereafter.…

How was this news broken to you that you have to present the Budget? How much time did you get to prepare for the Budget speech? By the time I came in, most of the work was done. Prime Minister (Narendra) Modi was very clear with his vision. And most of the things were already completed by the prime minister and Finance Minister Arun Jaitley. I came to know only on Wednesday night (January 24, the Budget was presented on February 1) that I have to present the Budget. I got eight days to prepare for it. The prime minister gave me support, and the finance minister, despite his health, also gave great support. I was in regular touch with him. He prepared the broad framework for the Budget. One…

NOT ALL PSYCHOPATHS are in prison – some are in the boardroom,” Robert Hare famously said during his aptly titled lecture, The Predators Among Us. Psychopathy is one of three “dark triad” traits, the other two being narcissism and Machiavellianism. It should be noted that, unlike clinical personality traits, these traits are normally distributed in the population – e.g., you can score low, average or high – and perfectly indicative of normal functioning. In other words, just because you score high doesn’t mean that you have problems, either at work or in your personal life. And despite the antisocial implications of the dark triad, recent research has highlighted a wide range of career-related benefits for these personality characteristics. Psychopathic individuals are generally more dishonest, egocentric, reckless, and cruel than the…

Virtus in Arduis: I Did It My Way By Parthasarathi Shome Publisher: Orient BlackSwan Pages: 304 Price: ₹895 IN JULY 2004, PARTHASARATHI Shome was at the IMF headquarters chairing a meeting with Venezuelan delegates when he received a call from P. Chidambaram, the newly appointed Finance Minister of the UPA government. PC, as Shome affectionately calls him in his latest book Virtus in Arduis (virtue in hard work), had connected at 3 a.m. Indian time and asked him to join the finance ministry as an advisor on tax matters. A short conversation followed, sprinkled with Chidambaram’s Wodehousian humour, and Shome agreed to pack his bags and shift to India in 15 days. It is one of the few anecdotes that would make you smile. The rest of the book features a…