NATION, P4 Markets trust familyowned businesses’ handling of Covid-19 SUNIL JAIN BAD DEBT PILE-UP TRENDING NOW! As Vedanta case shows, govt refusing to accept arbitration orders is the new challenge to Doing Business RBI has not asked banks to raise capital to brace for possible NPAs: Thakur ByteDance gets Trump nod to avoid TikTok shutdown NEW DELHI, MONDAY, SEPTEMBER 21, 2020 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL. XLVI NO. 174, 14 PAGES, `6.00 (PATNA `6.00, RAIPUR `7.00) P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E Ahemdabad Mumbai Chennai 12 20 Kolkata 26 45 25 31 larly, Kolkata registered 31 deaths perthousand,butWest Bengal accounted for a much lower 19. While Delhi has much lower death incidence of 11 deaths per 1,000, this is even lower in Bihar, Odisha, Jharkhand, Kerala and Telangana. Odisha recorded the lowest level, only three deaths for every 1,000 cases, whereas Bihar recorded four on September 20. Continued on Page 2 ● PLAY STORE RE-ENTRY PRABHUDATTA MISHRA New Delhi, September 20 QuickPicks Three months at district hospital must for PG medical students ALL POST-GRADUATE students pursuing MD or MS in broad specialities in medical colleges across the country will have to undergo a compulsory residential rotation of three months in district hospitals as part of the 2020-21 course curriculum, reports PTI. Such rotation — ‘District Residency Programme — shall take place in the 3rd, 4th or 5th semester of the PG programme. Govt envisages broader social security net for workers THE CENTRE has proposed to extend, in a phased manner, social security benefits to all employees and workers — estimated to be around 50 crore — including those in the unorganised sector enterprises, under the revised Social Security Code introduced in the Lok Sabha, reports Surya Sarathi Ray in New Delhi. PAGE 13 Details on Page 5 (W Benga) (MP) (Punjab) 3,343 (Kerala) (Kerala) …amid uneven supplies Market arrivals of tomato (tonne, Sept 1-19) 58,064 Karnataka 4,067 Odisha Source: Agmarknet 1,841 W Bengal ● TRUCE IN SIGHT? Arunachalam may be named to Murugappa board today SAJAN C KUMAR Chennai, September 20 family’s inclination to amicably settle the stake that her branch of the familyhas in the SHAREHOLDERS OF AMBADI business. Investments, the holding firm Arunachalam, the eldest of the Murugappa daughter of former Group,will on Monday executivechairmanMV vote on a proposal to Murugappa, publicly appointValliArunachastated in January she lam to the board of the was denied a board company. position in AIL despite If the resolution is being her father’s heir. passed, Arunachalam, Valli Murugappa passed 59,and a nuclear engi- Arunachalam away in 2017. Arunaneer, will be the first chalam, her sister and woman director in the cen- their mother hold an 8.15% tury-old group. stake inAmbadi Investments. The development will signal the larger Murugappa Continued on Page 2 Details on Page 2 1,200 1,000 800 600 400 200 0 2020 5,307.07 3,561.13 875 926 326 553 CONSUMER INTERNETCOMPANIES attracted investments of $3.5 billion between January and August, about 34% lower than a year ago, data sourced from market research firm Tracxn showed. Investments, which had slowed considerably in May and June, falling below $170 million, gathered pace in July and August when firms raised close to $800 million. Of this, online education companies Byju’s, Vedantu, Eruditus and Topprtogethersecuredcloseto $400 million from investors like DST Global, Coatue Management and Chan Zuckerberg Initiative.In September so far, Byju’s, Unacademy and Zomato have collectively raised over $750 million. Edtech firms have seenvaluations soar as more students have signed up for online classes post the pandemic. Continued on Page 2 June quarter FE BUREAU Even sharp cost cut fails to salvage situation India Inc resorted to unprecedented expenditure curbs to cushion the hit to bottom line in Covid-ravgaed Q1. That Q4 was already a bad quarter accentuated the crisis. Q1 GVA would have be been much worse, had costs not been reined in Net sales Total expenditure (% chg y-o-y) Q2 (% chg y-o-y) Q3 Q4 Q1 FY20 FY21 PBT Q3 Q4 Q1 FY20 FY21 Tax (% chg y-o-y) Q2 Q2 Q3 Q4 Q1 FY20 FY21 Q2 GVA (Ebitda+WC) (bps, chg y-o-y) (Chg y-o-y) Q2 Q3 Q4 Q1 FY20 FY21 Q2 RM to sales Q3 FY20 Q4 Q1 FY21 (bps, chg y-o-y) (% chg y-o-y) Source: Capitaline OPM -2.8 2,472 2019 ($ m) Total -58 5,164 (Karnataka) Potato 1,589 ASMITA DEY New Delhi, September 20 -334 -7.28 Onion 823 Continued on Page 2 254 Tomato 1,881 The sources added that even after June 2022,the noncomplaint states getting the compensation will be subject to the Council extending the compensation cess collection period beyond 2022. -168 (`/quintal; July-Sept 19) are Jharkhand, Kerala, Maharashtra, Punjab, TN, Rajasthan, Telangana Delhi and West Bengal Source: Tracxn/ Hurun Research Institute/ Company announcements -26.8 Average mandi price AMIDUPROARBYsections of the Opposition, Rajya Sabha on Sunday passed twoBillsthatseektoreplace two recent ordinances aimed at facilitating barrier-freeinter-statetrading of farm goods and contract farming,respectively,reportsfeBureauinNewDelhi. Since the Lok Sabha had passed the Bills last Thursday, only the President’s assent is now required for these to become law. -4.1 Sept* ■ States yet to respond 1.4 Jan Aug 1.45 (Total Q2, 2020 figures 2.5 updated after accounting 3 for more deals) Around 3 3.45 Source: Tracxn 6.37 8.42 10.8 16 Q3 Q4 Q1 FY20 FY21 -187.5 Facebook’s panoptic vision is a dangerous, yet exciting notion Aug Paytm Byju’s Oyo Ola Cabs Swiggy Zomato Paytm Mall Dream11 Unacademy Lenskart -158.5 A view to a kill July …but vary widely across regions RS passes key farm Bills amid uproar -36.4 ■ SCIENCE & TECH, P12 Onion Valuation ($ bn) -76.3 With an EIB loan in its kitty, the UP govt is aiming to flag off first stretch of `11,076-cr project by 2021 end Continued on Page 2 (average, `/qtl) 3,200 Tomato 2,400 1,600 800 0 decided to exercise the Option 1 include Andhra, Assam, Bihar, Gujarat, Haryana, MP, Odisha, Karnataka, UP Edtech, food delivery attract bulk of funds -2.9 Kanpur to come of age with Metro PAYTM ON SUNDAY said the company was “forced to comply”with Google’s mandate of removing its UPI cashback offer and scratch cards to get relisted on the Play Store. Google in an abrupt move had pulled out the Paytm app briefly from the Play Store on Fridaybefore restoring the app services later in the day. The tech major is understood to have viewed Paytm’s recently launched cashback campaign to be in violation of its gambling policies. The Paytm Cricket League on its consumer app allows userstogetplayerstickersafter each transaction, collect them and receive Paytm Cashback. The Noida-based payments firm said that on Friday morning, Google in a mailed statementtothecompanyobserved: “Yourappcontainscontentthat doesn’t comply with the Gambling policy as it offers games with“loyalty”(e.g.engagement or activity) points that (1) are accrued or accelerated via realmoneypurchaseswhich(2)can beexchangedforitemsorprizes of real-world monetaryvalue.” THE RECENTSURGE in mandi prices of the three all-season vegetables—tomato,onionand potato— and the wide rate disparities across key regions and production centres (see chart) laybare the fact that the Operation Greens scheme,which was launched 31 months ago in the FY19 Budget, has made little difference on the ground. Data gathered by FE shows that under the `500-crore OperationGreens,onlyfiveproposals worth about `124 crore have been approved so far; worse,aslittleas`2.4crorewas released underthe programme till July, and this amount went to a Gujarat-based company. ■ 21 states that have INVESTMENT -2.5 Forced to comply with Google’s mandate: Paytm Prices skyrocket… Pan-India mandi prices 1.8 ■ INFRASTRUCTURE, P11 UNSTABLE PRICES -20.2 Most focused funds go for a multi-cap approach with most of the investment in large-cap stocks Continued on Page 2 -27.3 When focused funds pay off trade payables of all CPSEs grew 1.5 times from `1.5 lakh crore at FY11 end to `2.2 lakh crore at FY19 end, the dues to CPSEs surged 3.8 times to `4.95 lakh crore during the same period. -65.2 ■ PERSONAL FINANCE, P9 HAL -7.7 A strong focus on India-centric innovations has led to India-specific features in Samsung’s product portfolio 4.41 *Data of CPSEs and departmental undertakings with annual capex of minimum ` 500 crore -75.3 Beyond merely making in India The consolidated figures are available for only up to FY19; but given the big rise in receivables of the 14 large firms,the figure must have shot up further in FY20. In fact, dues to CPSEs rose much faster than the amount they owe to the industry. If FY20 0.12 ■ eFE, P8 Coal India 4.36 11.8 Shopping malls rejig strategy to boost sales ahead of the festive season, as footfall remains low NTPC 4.41 FY19 FCI FY18 -0.17 Taking the mall to homes 3.81 FY17 Barely 0.5% of Operation Greens funds released in 31 months FE BUREAU New Delhi, September 20 ■ BRANDWAGON, P10 (` lakh crore) As at end of FY19 FY20 WITH AS MANY as 21 states/UTs agreeing to borrow to bridge their GST revenue shortfallundertheincentivised Option1,theCentrehastougheneditsstanceandindicatedto the dissident states that if they don’t fall in line before the scheduledGSTCouncilmeeton October5,thentheywouldhave towaittillJune2022togettheir compensation dues. According to the GST Act, theGSTCouncil,withfullpresence of sates and UTs,requires aminimumof20statestopass anyresolution,in casevoting is required on any issue, an official source pointed out,signaling the Centre’s resolve to implement the plan for the states to borrow. 13.5 23 19 CPSE capex has remained robust* SHARP DIVIDE Q2 Q3 Q4 Q1 FY20 FY21 -854.8 -72.55 16 13 times -60.4 India Firms deprived of payments the most 12,459 41 42 Punjab *of 249 firms 1.5 2.2 times 11,583 23 6 3 3.8 4.95 (` crore) FE BUREAU New Delhi, September 20 1.5 1.31 14,408 Odisha Their unpaid dues to industry 5,499 Maharashtra 32 TRADE RECEIVABLES OF 14 among the larger central public sector enterprises (CPSEs) rose 42%year-on-yearto `3.5 lakh crore at FY20 end,according to data reviewed byFE.This is partly, if not largely, due to payments held up by their owner,namelythe centralgovernment, against the supplies received of goods and services. So, if the CPSEs, on their part, havenotclearedalargeportion of their dues to the industry (public and private), and the outstanding amount touched `60,500 crore at March end, 2020, it is due to this vicious cycle of defaults. In fact, as the chart shows, the trade receivables of CPSEs – 249 in total – have been rising relentlesslyin recentyears. FY19 -37.1 FE SPECIALS Delhi Aug 20 Sept 20 11 11 FY11 2,868 1,843 CITIES, LIKE DELHIandMumbai, may be better equipped in terms of health infrastructure than states like Bihar and Odisha but they continue to report a higher ratio of new deaths. Indeed, cities are recording more deaths per 1,000casesthanotherregions. Mumbai, for instance, registered 26 deaths for every 1,000 cases on September 20. While the ratio has come down from 47 deaths per 1,000 infections a month ago, it is still higher than the 23 deaths per 1,000 registered in Maharashtra. Ahmedabad and Kolkata are no different.Ahmedabad’s death ratio foreverythousand cases at 19, is higher than Gujarat’s ratio of 12. Simi- Bihar 3 4 PRASANTA SAHU New Delhi, September 20 (` lack crore) CPSEs'* receivables 15,668 ISHAAN GERA New Delhi, September 20 New deaths per thousand (7-day rolling average of new deaths/14-day average of cases) large CPSEs rose 42% year-on-year to `3.5 lakh cr in FY20 2,235 1,052 Continued on Page 2 26 deaths per 1,000 cases in Mumbai against state average of 23; cases of Kolkata, Ahmedabad similar Cities have a deadly problem 21 states agree to CPSEs owe others a lot, but deprived of dues much larger borrow; others may lose aid, says Centre Receivables of 14 8,434 IT'SGOINGTObealmostayear sincethegovernmentapproved a`70,000-crorerevivalpackage for the ailing Bharat Sanchar Nigam(BSNL),butthecompany is still struggling to put in place a tender to place orders for building its 4G network.This is whenoneofthekeyreasonsforwarded by the government in favour of a revival package was that once 4G spectrum worth around`24,000croreisgivento the companyitwouldbe able to effectivelycompetewithitsprivate sector peers and become profitablebyFY24. The company’s 4G tender first ran into trouble over the issuewhetherChinesevendors like Huawei and ZTE should be allowed to participate in it or not and later whether foreign vendors should be totally kept out which means shutting doors on the likes of even Nokia,Ericsson and Samsung. Amid these pulls and pressuresthetender,whichthecompanyfloatedinMarch,hadtobe cancelled and since then a new network building model which is still at trial stage is being pushed by various sections in the government and local industry. GST SHORTFALL 2,54,600 KIRAN RATHEE New Delhi, September 20 More people are dying in the cities VICIOUS CYCLE 2,478 921 BSNL losses to soar as 4G tender stuck COVID-19 1,76,872 ● LOCAL VS GLOBAL -17.6 J SINHA & S MOHANTY BACK PAGE, P14 -14.2 OPINION, P6 Sample of 2,793 companies THE REEL DEAL Ayushmann Khurrana: The pandemic-proof brand endorser? DEVINA JOSHI Mumbai, September 20 LAST YEAR’S FAN favourite, Bollywood star Ayushmann Khurrana, seems to be continuing his winning streak in the branding world this year, too, having signed six to eight new brand endorsement deals, including Tide India, Toyota’s Urban Cruiser, Nestlé’s KitKat, Bajaj Allianz, JSW Paints and Sprite. What’s interesting to note is, this is right in the middle of the ongoing pandemic that has disrupted the marketing industry significantly. Furthermore, his new wins stand out because unlike last year, when he made waves with movies like Article 15 and winning the National Award for Andhadhun, Khurrana hasn’t had any major hits/releases in 2020 (his tally this year includes Shubh Mangal Zyada Saavdhan and the digitally WINNING STREAK ■ Toyota Urban Cruiser ■ BajajAllianz ■ Peter England ■ Nexus Malls ■ The Man Company ■ Magic Bricks ■ Tutorix ■ Godrej Securities ■ The Urban Company ■ Ranjit InnerWear ■ KitKat ■ DanielWellington ■ Titan ■ BalajiWafers ■ Sprite ■ Tide India ■ JSWPaints released Gulabo Sitabo). “He is probably riding on last year’s success,” says Aviral Jain, MD, Duff & Phelps. “But his movie themes aren’t radically different from last year; they are still social themes, humorous themes about the practical aspects of society. So, his positioning remains largely unaltered.” With these new endorsement contracts, he now has a total of 17 brands in his kitty, in addition to some old ones in the process New Delhi of renewal. Khurrana, according to sources, hasn’t changed his annual endorsement fee from last year, and is maintaining it at `1.5-2 crore. In addition to these retainers, he has also done a few short campaign bursts on digital media, particularly on Instagram, with brands like Disney+ Hotstar, Reliance Fresh, Club Mahindra, Dhani and Castrol Activ. Continued on Page 2
The Financial Express (FE) is a business paper that’s closest to the people who are in the business of business. From business policies to market trends to new developments, The Financial Express comes packed with incisive news on every relevant issue.