OPINION, P6 ECONOMY, P2 NATION, P12 RAMEESH KAILASAM EDITORIAL PANDEY ON LIC LISTING CHILDREN & ADOLESCENTS VACCINE Need to relook ESG measuring for a more balanced approach States to end FY22 on slightly better note; must increase capex spends to improve deficit Rise in surplus transfer to shareholders won't impact policyholders Govt to take call based on 'scientific rationale', supply situation: Paul PUNE , MONDAY, OCTOBER 18, 2021 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL. NO XII 219, 18 PAGES, `6.00 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 LOOKING UP CAPTIVE USE EarlyQ2 results boost hopes of firm recovery Allocate 5G spectrum to private networks onlyvia auction: Telcos ■ eFE, P8 Cybersecurity skills gap IBM’s skilling & hiring programmes are bringing in talent from non-traditional paths to innovate for cybersecurity ■ PERSONAL FINANCE, P9 Rebalancing your portfolio After a sustained bear or bull rally as the asset allocation ratio deviates significantly, it is time to rebalance your portfolio ■ INFRASTRUCTURE, P11 Agenda’s vital to success of NMP With road sector mandated to raise `1.6 trn via monetisation, many factors must be borne in mind for programme’s delivery ■ SCIENCE & TECH, P7 China's contentious net-zero path The country put energy security first while doubling down on renewables (` cr, from FY16 to FY21 under ATUFS) Investments Subsidy Weaving 14,876 1,131 Processing 46,861 4,636 323 3,378 Garments 2,692 266 Technical textiles 2,670 246 Total* *Including other segments Note: ATUFS investment target of `95,000 cr by FY22 set to be missed torbyFY22 and create 3.5 million new jobs. Continued on Page 2 BSE benchmark Sensex rallied 1,246.89 points or 2.07%.Thebenchmarkwent pastthe61,000-markforthe first time ever on Thursday. Markets were closed on FridayforDussehra. —PTI Over 4 crore unorganised workers registered PRESS TRUST OF INDIA New Delhi, October 17 THE MINISTRY OF labour and employment on Sunday said the number registrations has crossed 4-crore mark on eShram portal in less than two months of its launch. According to a labour ministry statement, workers in diverse occupations such as construction, apparel manufacturing,fishing,gig and platform work, street vending, domestic work, agriculture and allied, transport sector have registered on the portal. In some of these sectors,an overwhelming proportion of migrant workers are also engaged,it stated. Allworkers in the unorganised sector, including migrant ones,cannowtakethebenefits of various social security and employment-based schemes through registration on the eShram portal. As per latest data, 4.09 crore workers have registered on the portal. Of these, around 50.02% beneficiaries are female and 49.98% are male. It is encouraging that equivalent proportion of men and women have been part of this drive,it stated. Continued on Page 2 91 -15 Borrowings Tax -23 revenues Total -13 expenditure 14 34 70 5 10 Revenue expenditure *Of 20 major states reviewed by FE Infra growth FE BUREAU Tenders & awards pick up pace in July-Sept qtr Tendering activity for infrastructure projects picked up in Q2FY22, registering a 22% YoY growth, led by roads, power distribution and power equipment sectors. In Q1, tendering was down 13% YoY. Overall tendering grew 5% YoY during H1FY22 Tendering activity records 28% 2-year CAGR in H1FY22 Total tender value (` bn) 1,200 1,000 800 600 400 200 0 Awarding activity sees 22% 2-year CAGR in H1FY22 Growth yoy % (RHS) 300 250 200 150 100 50 0 -50 -100 THE FINANCE ministry will soon move the Cabinet to seek approval for setting up a company for transfer and subsequent monetisation of land and non-core assets of privatisation-bound CPSEs, an official said, reports PTI. A special purpose vehicle (SPV) in the form of a company would be set up to hold these assets which would be monetised to fetch value to the exchequer, DIPAM secretary Tuhin Kanta Pandey said. Coal import drops despite higher demand from power sector INDIA'S COAL IMPORT registered a decline of 2.7% to 15.22 million tonne (MT) in August amid the country's power plants grappling with fuel shortages, reports PTI. The country imported 15.64 MT of coal in the corresponding month last year. SECTIONS OF THE industry that use natural gas as fuel or feedstock and the city-gas marketing companies are bearing the brunt of record high spot market rates of liquefied natural gas (LNG) in the global markets. With their margins coming under severe pressure, these firms have already or will soon raise the prices of the goods they sell,leading to 35 30 25 20 15 10 5 0 Asian spot markets US spot markets ($/mbtu) 33.11 2.02 4.02 Jan 2020 a spiralling of prices of items ranging from urea to ceramics and food supplied by hotels and restaurants. 5.56 Oct 2021 Among the industries that consume natural gas, many don't have access to cheaper domestic gas. For some 200 100 200 0 0 Crop insurance being revamped,panel set up extremely price sensitive user industries like the power sector, landed price of more than $6-8 per million British thermal units (mbtu) makes it unsustainable to continue operations. Asian spot LNG rates had climbed from $6.9/ mbtu at the beginning of the fiscalyear to $17.7/mbtu at August end. Prices have crossed $33/mbtu in early October amid low stocks, high demand and limited supply of the fuel. Thankfully,theriseininter- 300 400 REBOOTING Move comes after many states quit the scheme, defeating the objective of protecting farmers’ income The Centre has identified a hardening ofpremium market, lack ofsufficient participation in tenders and underwriting capacity ofinsurers as major issues -100 ● NATURE’S FURY Kerala landslide toll touches 18 as rescuers dig deeper PRESS TRUST OF INDIA Kottayam/Idukki, October 17 national LNG prices coincided with substantial jump in domesticgasproduction,helping in cutting import dependencyofnaturalgasfrom54% in April-August, 2020 to 49% in the corresponding period this year. The impact of higher LNG prices are being felt disproportionately among users depending on factors such as access to cheaperdomestic gas and government subsidies. THE TOLL FROM disastrous flooding caused byheavyrains and landslides in hilly areas of two central Kerala districts rose to 18 as rescue workers recovered more bodies from the rubbles on Sunday. State revenue minister K Rajan said the rescue workers have recovered 15 bodies from the debris and slush of the landslides that had hit various places of Idukki and Kottayam districts on Saturday. "The rescue workers have recovered 15 bodies till now. This includes 12 bodies from Koottickal in Kottayam, one bodyfromPeerumeduandtwo which were recovered yesterday from Kanjar in Idukki district,"Rajan told PTI. Idukki District Collector Sheeba George said three bodies were recovered from Kokkayar in Idukki district today,a hilly region which was heavily hit by yesterday's devastating landslides. "The search is on for five missing persons,"she told PTI. Continued on Page 2 Continued on Page 2 defeating the objective of protecting farmers’ income. Continued on Page 2 Skyrocketing LNG prices jack up industrial costs Natural gas prices 400 600 PASS-THROUGH ANUPAM CHATTERJEE New Delhi, October 17 500 800 REVIVING INTEREST AIMING TO ROLL out an overhauled Pradhan Mantri Fasal Bima Yojana (PMFBY) from kharif 2022, the government has constituted a working group comprising officials from Centre, key crop-producing states and top executives of public sector insurance companies to suggest “sustainable, financial and operational models.” The move comes after many states quit the scheme, Growth yoy % (RHS) 1,000 Source: Projects Today, Emkay Research PRABHUDATTA MISHRA New Delhi, October 17 Total awards value (` bn) 1,200 QuickPicks Finmin to seek Cabinet nod for monetising land assets of CPSEs Continued on Page 2 Sep-21 Continued on Page 2 AIDED BYIMPRESSIVEgrowth in tax revenues, capital expenditure by state governments haveshownamarkedimprovementinthefirstfivemonthsof the current financial year even as the advantage of low base has begun to peter out. Data gathered by FE of 20 major states showed that these statesreportedcombinedcapex of `1.21 lakh crore in April- AugustofFY22,up70%onyear compared with a decline of 35%onyearinthecorrespondingperiodofFY21.Thesestates’ capex in April-August in the current fiscal year was 10% highercomparedwiththesame in the corresponding period of the pre-pandemicyear,FY20. The Centre also roped in CPSEsforpushingpubliccapex, which is key to an investmentled economic growth revival. Jan-21 Key beneficiaries Market capitalisation of eight of top-10 most valued firms jumps over `1.52L cr EIGHT OF the top-10 most valued companies together added `1,52,355.03 crore in market valuation last week, with HDFC Bank and State BankofIndiaemergingasthe biggestgainers.Lastweek,the Telecom operators are opposed to administrative allocation of spectrum to enterprises for setting up such private networks. (April-August, growth %, y-o-y) FY21 FY22 May-21 Experts discuss if there is merit in brands taking a stand on social issues through their advertisements starts discussions for 5G auctions, this issue will also be taken up for consultation States’* finances PRASANTA SAHU New Delhi, October 17 Sep-20 Ads for social change ■ As and when Trai States maintain robust capex pace, so do CPSEs Jan-20 ■ BRANDWAGON, P10 THE GOVERNMENT IS planningamajorrevampofitsflagship incentive scheme forcapital investments in the textile andgarment sectortoimprove its performance and align its objectiveswith otherrecentlylaunched programmes, including the productionlinked incentive (PLI) scheme and mega parks, official sources told FE. While notifying the Amended Technology Upgradation Fund Scheme (ATUFS) in January 2016, the government had set aside an outlayof `17,822 crore (`12,671 crore for clearing pending claims under the scheme’s earlier avatars and `5,151 crore for implementing the ATUFS) until FY22.The scheme is supposed to mobilise fresh investments of about `95,000 crore in the textile and apparel sec- WHAT'S THE WAY FORWARD ● E-SHRAM PORTAL ATUFS overhaul to spur investments BANIKINKAR PATTANAYAK New Delhi, October 17 usage is for captive purposes and there's no commercial angle May-20 FE SPECIALS ■ Auction does not make sense as CAPITAL FORMATION Sep-19 TEXTILE SECTOR spectrum should be given on fixed charge -35 from 8.6% in the previous quarterwhile for Infosys it hit 20.1% from 13.9% in Q1 and for Wipro 20.5%. To cope with the shortage, they plan to recruit graduates in large numbers; TCS proposes to hire 35,000 fresh graduates in H2FY22 taking the total fortheyearto78,000. TCS has on-boarded some 43,000 graduates in the last six months. Pravin Rao,chief operating officerof Infosys said the company intends to expand its plan to hire college graduates to 45,000 for the year; the companyhad earlierproposed to recruit 35,000 graduates. ■ Non-telecom firms feel that Capex improvement in client metrics. Margins at TCS were steadyand analysts believe the companyiswell-positioned to tackle any headwinds. It’s early days and rising commodity prices would have hit the operating margins of user companies while boosting the revenues of producers. Auto companies would have suffered due to the shortage of chips as seen in the volume data. IT players are in a bit of a spot because attrition levels have gone up sharply from the range of 10-20% to 2030%.At TCS,the attrition rate went up to 11.9% in Q2FY22 that spectrum for such networks should also be auctioned A potter engaged in making diya (earthen lamps) for the upcoming Diwali festival at Chandlodiya in Ahmedabad. EXPRESS PHOTO BY NIRMAL HARINDRAN Sep-21 Sample of 61 companies; Source: Capitaline ■ Telecom operators are insisting FESTIVE VERVE Jan-21 OPM (chg in bps) WHAT'S THE FIGHTABOUT May-21 RM to sales (chg in bps) -62.41 -43.01 WITH 5G SERVICES on the anvil, a tussle has started between telecom operators and non-telecom firms over allowing setting up of private networks. Since 5G allows for office automation, machine-tomachine communications on a much large scale,a need has been felt by non-telecom firms for setting up their own telecom networks for captive purposes — meaning for all kind of communication activities within their internal networks.In simple terms it allows firms to set up their own WiFi network rather than taking the services from any telecom service provider as is the norm today. However, for external communication, services of a telecomoperatorwouldbeneeded. For setting up private networks, companies would need 5G spectrum and the fight is how the same would be allocated to them. ■ But for external communications, networksoftelecomfirmsareneeded Sep-20 Net profit 168.93 ■ Quality ofservice is ensured and within the firm's control Jan-20 5.16 Operating profit 77.14 ■ It allows firms to set up their own WiFi network rather than taking the services from any telecom service provider as is the norm today May-20 7.91 18.27 7.32 Net sales KIRAN RATHEE New Delhi, October 17 WHAT IS A PRIVATE NETWORK Sep-19 q-o-q 21.56 y-o-y FE BUREAU New Delhi, October 17 READ THROUGHS, FROM the results statements trickling in, suggest the economy was certainly getting back on track in the three months to September though all businesses were not back at prepandemic levels. At HDFC Bank, for instance both disbursements and recoveries were better. Again, at Avenue Supermarts standalone revenues were up nearly 50% year-on-year driven up by better footfalls post the second wave; the increases were better even when compared with the same period in 2020. The retailer’s gross profit margins expanded 40 basis points y-oy while Ebitda margins rose 240 bps y-o-y. IT players, which form a huge proportion of early birds,turned in a good performance. Infosys posted excellent all-round growth reporting stable margins and an Analysts against auction, say non-telcos could be made to pay fixed charge for spectrum Q2FY22 (%) 19.95 Retailers, banks signal nascent pick-up in consumption; IT firms too impress Pune
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