OPINION, P6 COMPANIES, P4 INTERNATIONAL, P8 EDITORIAL APPOINTMENT PANDEMIC BLOW Tata Steel's Narendran takes over as new CII president WHO, at heart of world's sluggish response, could face shake-up India Inc should contribute to‘stimulus’ targetted at have-nots Let vax data from ground, other jurisdictions inform any shift to a single-dose regime for Covishield NEW DELHI, TUESDAY, JUNE 1, 2021 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL. XLVII NO. 78, 16 PAGES, `8.00 (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 SENSEX: 51,937.44 ▲ 514.56 NIFTY: 15,582.80 ▲ 147.15 NIKKEI 225: 28,860.08 ▼ 289.33 HANG SENG: 29,151.80 ▲ 27.39 `/$: 72.62 ▼ 0.19 `/€: 88.50 ▼ 0.21 BRENT: $69.72 ▲ $1.00 GOLD: `48,933 ▲ `392 THE OUTPUT OF eight core sectors jumped by 56.1% in April mainly due to a low base effect and uptick in production of natural gas, refinery products, steel, cement and electricity, official data released on Monday showed, reports PTI. The eight infrastructure sectors had contracted by 37.9% in April 2020. RBI sets FPI investment limits in G-secs, SDLs THE RESERVE BANK of India on Monday said the limits for foreign portfolio investors (FPI) investment during the current fiscal in G-secs and state development loans will remain unchanged at 6% and 2%, respectively, of outstanding stocks of securities for 2021-22, reports PTI. Sebi levies `12-cr fine on Winsome Yarns, its MD SEBI HAS SLAPPED a penalty totalling `12 crore on Winsome Yarns and its MD in a matter pertaining to manipulation in issuance of global depositories receipts, thereby violating market norms, reports PTI. GROWTH CURVE Recovery in Q4 narrows FY21 GDP decline to 7.3% March quarter saw rebound in manufacturing and construction 12 8 INDIA'S GROSS DOMESTIc product (GDP) shrank 7.3% in 2020-21, the sharpest drop in recorded history,with the pandemic dealing a body blow to most sectors of the economy that was already debilitated, according to data released by NationalStatisticalOffice(NSO) on Monday. The contraction was, however, narrower than the 8% forecast in the second advanceestimateputoutinlate February,primarilybecausethe Marchquarterturnedinsignificantly better numbers, on the 5.5 6.4 8 7.4 Best performers 8.3 6.8 (% change in GVA, y-o-y, in Q4, FY21) 6.5 4 4 Construction 0 FY13 FY14 FY15 Pvt consumption Fixed investment (% change, y-o-y) 15 10 5.5 5 0 0.6 -5 -10 4.9 -15 FY13 FY16 Govt consumption 2.9 FY17 FY18 FY19 (% change, y-o-y) 10 FY20 -9.1 -20 FY21 back of rather board-based upswing across sectors including manufacturing, construction and electricity. “Public administration and other services”which incidentally include health services -30 6.9 Worst performers GDP (% change in GVA, y-o-y, in Q4, FY21) 1.6 Mining -24.4 Q1, FY21 Q1, FY20 Q4, FY21 Beneficiaries wait under a tree to receive the Covid-19 vaccine dose at a vaccination centre in Kolkata on Monday -5.7 Trade, hotels, -2.3 transport, etc Public administration, etc -10 -10.8 9.1 Manufacturing FY21 0 5.4 14.5 Electricity, etc -7.3 -4 -8 FE BUREAU New Delhi, May 31 GDP (% change, y-o-y) 2.3 Source: MoSPI thatsawanuptickduetoCovid management also picked up in Q4.Gross value added (GVA) in Q4 was up 3.7% on year, and GDP, 1.6%, compared with 2.5% and (-)1.1% seen in the secondadvanceestimate.After twosuccessivequartersofdeep contraction, the GDP growth had returned to positive territory in Q3, with an expansion rate of 0.5%. Continued on Page 2 Centre's fiscal deficit at 9.2% in FY21, against revised estimate of 9.5% WITH ITS NET tax revenue being 6% higher than the revised estimate (RE) presented in February,the Centre managed to narrow its fiscal deficit moderately to 9.2% of the GDP in FY21, against 9.5% budgeted (RE), reports fe Bureau in New Delhi. This was still the highest level of deficit for the Centre since 7.8% reported in FY91, the year when economic liberalisation was unleashed amid a balance of payment crisis. Apartfromaahugerevenueshortfall, stimulus measures to boost economic ● DIGITAL MEDIA ● SAFETY PROTOCOLS activities, clearance of arrears to Food Corporation of India and fertiliser companiescontributedtothesurgeincentral government’s fiscal deficit. Substantial off-budget expenditures (readpaymentstoFCI)werebroughtinto the Budget as well. ■ Page 2 MARQUEE INVESTORS HC asks TN to inspect Twitter has Puri, Carlyle home Renault-Nissan plant to comply in on PNB Housing, with new IT SAJAN C KUMAR Chennai, May 31 THE MADRAS HIGH Court on Monday directed the state governmenttoinspectwhetherthe ChennaifactoryofRenaultNissanAutomotive India (RNAIPL) had Covid-related safety protocols in place.The court ordered that a senior government official related to industrial safety shouldcarryouttheinspection. The companyhas been asked to submit the number of infected workers and those in hospitals andhomeisolation.Meanwhile, the workers were also asked to resumework fromTuesday. The high court’s direction to the employees came on a Company asked to submit number ofworkers infected Also, number ofworkers in hospitals/home isolation On Monday, plant operations resumed after a 5-day suspension ■But a section ofemployees didn't report forwork citing lack ofsafety protocols day when the company resumedoperationsatitsplant aftersuspendingitforfivedays starting May 26. Continued on Page 2 Special Feature Sun Pharma’s Q4 bottomline was impacted by one-offs Steady progress in sales of specialty products in the quarter; the momentum in segment is likely to be sustained; ‘Buy’ rating retained with target price raised to `815 from `770 ■ Investor, P7 QuickPicks Adar Poonawala takes control of Magma via `3,456-cr infusion ADAR POONAWALLA on Monday took over as chairman of Magma Fincorp, a non-banking finance company, reports fe Bureau in Pune. This follows the acquisition of a controlling stake in Magma thorough an equity infusion of `3,456 crore in May by Rising Sun Holdings. With 60% shares owned by Rising Sun Holdings, the company is now part of the Poonawalla Group. PAGE 4 Urban joblessness at 17.88%, rural rate falls by 4 pps UNEMPLOYMENT IN the urban areas stood at a worrisome 17.88% for the week ended May 30, reports Surya Sarathi Ray in New Delhi. The rate has risen for the seventh straight week and 47 basis points (bps) over the previous week. While worse is yet to come, the jury is still out on whether the rate will rise to the highest level ever of 27.1% seen in the aftermath of last year's lockdown. PAGE 2 rules: HC PRESS TRUST OF INDIA New Delhi, May 31 TWITTER HAS TO comply with the new Information Technology Rules for digital media if they have not been stayed, the Delhi High Court said on Monday. Justice Rekha Palli issued notice to the Centre and social media platform Twitter seeking theirstand on a petition by a lawyer,Amit Acharya, claiming non-compliance of the rules by the company. While Twitter claimed before the court that it has complied with the rules and appointeda residentgrievance officer, the central government disputed the claim. “They have to follow it (rules), if it has not been stayed,”the court said. In his plea, filed through advocate Akash Vajpai and Manish Kumar, Acharya said thathecametoknowaboutthe alleged non-compliance when he tried to lodge a complaint against a couple of tweets. During the hearing, RipudamanSinghBhardwaj,standing counselforthe centralgovernment told the high court that Twitter has not complied with the rules. Continued on Page 11 to infuse `4,000 cr Capital raise amount (` cr) Pluto investments (Carlyle Group) Total 4,000 (Fund managed by SSG Group) 400 3,185 30.2 Alpha Investments Salisbury Investments 25 0.20% Shareholding post equity and warrant allotment (%) 3.8 General Atlantic Singapore 9.8 390 FE BUREAU Mumbai, May 31 SHARES OF PNB Housing Finance remained locked at the upper circuit on Monday with Aditya Puri and Carlyle Group emerging as key investors in the company. The mortgage player’s board approved a fund-raise of up to `4,000 crore through a preferential allotment of equity shares and warrants.The issue priceof`390 pershareimplies adiscountof25%toMonday’s The capital raise is subject to regulatory and shareholders’ approvals at EGM on June 22,2021 closing price of `525.65 per share on the BSE. While Carlyle Group firm Pluto Investments has agreed to invest up to `3,185 crore, Aditya Puri,through his family investment vehicle Salisbury Investments, will invest `25 crore.The SSG Group and General Atlantic will also participate in the capital raise, with contributions of `400 crore and `390 crore, respectively, PNB Housing said. Continued on Page 2 Sebi asks listed companies to make disclosure on loans given to promoters SEBI ASKED LISTED companiestomakedisclosureabout loans and guarantees providedbythemtopromoteror anyotherentitycontrolledby them on a half-yearlybasis in thecompliancereportoncorporate governance, reports PTI.The move aims to bring transparencyandstrengthen disclosures about such loans and guarantees. ■ Page 9 COVID VACCINE SC raps Centre for dual pricing, seeks policy note FE BUREAU New Delhi, May 31 ■ Centre asked STICKINGTO ITS criticalview oftheCentre’svaccinationpolicy, the Supreme Court on Monday called for more inclusive approach to cater to the rural areas. Questioning the rationalefordual policyofprocurement of vaccines, the courtwonderedwhywasn’tthe Centre making the products available to the states at the same price. The apex court asked the Centre as to why several state governments and municipal corporations were issuing global tenders to procure vaccines. It observed the Centre has failed to submit a national policydocument on Covidvaccines till date.“We have some concerns. Is this the policy of the government of India that every municipal corporation, every state is left to their own to get vaccine. Does the government of India contemplate to produce its policy document on vaccine procurement and its pricing within two weeks ■ SC wants Centre to explain rationale behind dual pricing and why previous policy was abandoned ■ SC questions ifthe new govt policy allowed states, municipal corporations to issue global tenders to procurevaccines ■ Why vaccine pricing was left to manufacturers when law allows the Union government to determine the price itself, asks SC that for the procurement for foreignvaccines,thattherewill beindividualstatesorcorporations submitting bids or are you going to be a nodal agency for the bids?”the court asked. Continued on Page 2 Dr Reddy's in talks with government to bring Russia's Sputnik Light to India DR REDDY'S LABORATORIES is in talks with the government to bring Russia’s Sputnik Light vaccine into the country, a company spokespersontoldReuterson Monday, reports Reuters. DRL is also in talks with the government and the private sector to supply the twodose Sputnik V vaccine, which the company expects to commercially launch in the middle of next month. Delhi likely to get Sputnik V after June 20, says Kejriwal PRESS TRUST OF INDIA New Delhi, May 31 DELHI IS LIKELY to receive the first consignment of SputnikV, the Russian Covid-19 vaccine, in June, Delhi chief minister Arvind Kejriwal said, stressing that vaccination is key to the fight against coronavirus.The chief minister also said the city currentlyhasaround944cases of mucormycosis or black fungus, including 300 at the centralgovernment-runhospitals. He inaugurated a freewalkinvaccination facilityforjournalists and their families at Sarvodaya Bal Vidyalaya at DDU Marg in ITO. “We have started this vaccination facility for journalists and their families.There was a demand from journalists to start a specialvaccination facility forthem.Thevaccinesarebeing administered to those who are inthe18-44agegroupaswellas those above 45. I urge all journaliststocomeinlargenumbers andgetvaccinated.Youcanprotectyourselfonlythroughvaccination,” he told reporters. Continued on Page 11 Monday magic FE BUREAU Sensex market cap tops `100 lakh crore The market capitalisation of Sensex topped `100 lakh crore for the first time as investors continue to snap up shares despite the fact that many of them are richly valued. Interestingly, over a quarter of Sensex’ market capitalisation is contributed by just two companies — RIL and TCS. At 51,937.44, the Sensex is trading at 21.8 times of its 12-month forward earnings, which is a premium of 18% to its five-year average Sensex M-cap (` lakh crore) 101 100.22 92.13 97 93 89 85 Jan 1, 2021 May 31, 2021 Source: Bloomberg RIL TCS HDFC Bank Infosys HUL HDFC ICICI Bank SBI KMB Bajaj Finance 14.12 11.66 8.35 5.93 5.49 Six ﬁrms 4.60 4.57 contribute half of Sensex' M-cap 3.78 (M-cap as a 3.58 % of index) 3.39 AGEING POPULATION In a major policy shift, Chinese couples can now have third child TONY MUNROE & DAVID STANWAY Beijing, May 31 MARRIED CHINESE COUPLES may have up to three children,China announced on Monday, in a major shift from the existing limit of two after recent data showed a dramatic decline in births in the world’s most populous country. Beijing scrapped its decades-old one-child policy in 2016, replacing it with a two-child limit to tryand stave off risks to its economy from a rapidly aging population. But that failed to result in a sustained surgeinbirthsgiventhe high cost of raising children in Chinese cities,a challenge that persists to this day. The policy change will come with “supportive measures,which will be conducive to improving our country's populationstructure,fulfilling the country's strategy of actively coping with an ageing population”, the official Xinhua news agency said follow- ILLUSTRATION: ROHNIT PHORE IN THE NEWS Eight core infra sectors’ output soars in April ing a politburo meeting chairedbyPresidentXiJinping. Among those measures, China will lower educational costs for families, step up tax and housing support, guarantee the legal interests of workingwomenandclampdownon “sky-high”dowries,itsaid,without giving specifics. It would alsolooktoeducateyoungpeople“on marriage and love”. China had a fertility rate of just 1.3 children per woman in 2020, recent data showed, on par with ageing societies like New Delhi Japan and Italy and far short of the roughly 2.1 needed for replacement level.“People are held back not by the two-childrenlimit,butbytheincredibly highcostsofraisingchildrenin today’s China. Housing, extracurricularactivities,food,trips, and everything else add up quickly,”Yifei Li,a sociologist at NYU Shanghai, told Reuters. “Raising the limit itself is unlikelytotiltanyone'scalculusin a meaningfulway,in myview.” Continued on Page 11
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