OPINION, P6 ECONOMY, P2 COMPANIES, P4 EDITORIAL REVIEWING CAPEX REMUNERATION CLEARED FM nudges DoT to speed up digital expansion in N-E Lal’s reappointment as Eicher Motors MD gets shareholders’ nod Rich nations must adopt more ambitious targets at CoP26 Need to reform grains procurement policy, FCI in a bind over excess holdings CHENNAI/KOCHI, TUESDAY, OCTOBER 26, 2021 VOL XLIII NO. 145, 16 PAGES, `6.00 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD 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: 60,967.05 ▲ 145.43 NIFTY: 18,125.40 ▲ 10.50 NIKKEI 225: 28,600.41 ▼ 204.44 HANG SENG: 26,132.03 ▲ 5.10 `/$: 75.09 ▼ 0.19 `/€: 87.30 ▼ 0.11 BRENT: $86.37 ▲ $0.84 GOLD: `47,899 ▲ `295 RELIEF PACKAGE IN THE NEWS Accurate audit reports essential for growth: RBI guv Telco to get cash flow relief of around `35,000-40,000 cr KIRAN RATHEE New Delhi, October 25 Amrapali case: SC told 150 flats to be delivered on Diwali BHARTIAIRTELHASinformed the Department of Telecommunications (DoT) about its acceptance of the four-year moratorium forpayment of its adjusted gross revenue (AGR) and spectrum dues. Sources said Bharti sent its acceptance letter to the DoT on Friday. Last week, Vodafone Idea had told the DoT about its acceptance of the four-year moratorium for spectrum dues’payment.It said the decision regarding accepting the moratorium for AGR would be taken by its board by October 29, the deadline given by the government to the operators. AfterOctober29,operators have been given 90 days to confirm whether they would opt for paying the interest which accrues as a result of the deferral by way of offering equity to the government. Earlier in an interviewwith FE, Bharti Airtel chairman SunilBhartiMittalhadsaidthe IN A first glimmer of hope for hassled Amrapali homebuyers, around 150 flats completed by NBCC in a stalled project since the real estate company ran into trouble will be given to them on the occasion of Diwali, the Supreme Court was informed on Monday, reports PTI. Central Vista: Top court questions land use change THE SUPREME Court on Monday asked the Central government to file an affidavit explaining the need for the proposed change in land use for the ambitious Central Vista Project, reports fe Bureau in New Delhi. Special Features What tracking error says about a mutual fund Benchmark Fund Mutual Fund Oil on the boil as demand surges Bharti Airtel accepts moratorium on AGR, spectrum payments RBI GOVERNOR Shaktikanta Das on Monday said accurate and analytical audit reports are essential for financial stability and growth as they instil confidence among members of the public, reports PTI. In case of the public sector, auditing is a cornerstone of good governance, he said. Tracking Error TIGHT SUPPLY Tracking error is a good measure of performance by a mutual fund compared to benchmark performance but does not disclose much information on why variation takes place ■ Personal Finance, P7 A rebound across segments in Q2 for Reliance Industries Q2 EPS was up 43% y-o-y; surge in GRM and retail improvement has boosted outlook for the company; FY22/23e EPS up 0.3-4%; TP raised by 24% to `2,510; ‘Hold’ rating retained ■ Investor, P7 QuickPicks Govt signs share purchase pact with Tatas for Air India sell-off THE GOVERNMENT on Monday signed an agreement with Tata Sons for the sale of crisis-ridden national carrier Air India for `18,000 crore, reports fe Bureau in New Delhi. In a tweet, department of investment and public asset management (DIPAM) secretary Tuhin Kanta Pandey said: "Share Purchase Agreement signed today by Government with Tata Sons for strategic disinvestment ofAir India." Earlier this month, the government had accepted the financial bid put in by Tata Sons for AI. PAGE 2 Telcos urge DoT to extend 5G trial period by six months TELECOM OPERATORS, including Reliance Jio, Bharti Airtel and Vodafone Idea, have asked the DoT to extend the 5G trial period by six months, reports PTI. In May, the government allocated spectrum to the telcos in 700 MHz band, 3.3-3.6 GHz and 24.25-28.5 GHz bands for trials across various locations for six months. "All telecom companies have asked for extension of 5G trials by another six months," a senior government official told PTI. The current trial period ends in November. PAGE 3 `4,500-cr solar PLI scheme: 16 companies make the cut AS MANY as 16 companies have become eligible for the `4,500-crore production-linked incentive (PLI) scheme for solar panel manufacturing, sources said, reports Anupam Chatterjee in New Delhi. According to their rankings, the top five firms in the list are Jindal India Solar Energy, Shirdi Sai Electricals, Reliance New Energy Solar, Adani Infrastructure and FS India Solar Ventures. However, it was not immediately clear how much incentive the firms will receive under the scheme. PAGE 2 Goldman Sachs sees upside risks to $90/bbl Brent price forecast MAKING A CHOICE Savings on cash flow to be used by Bharti for network and 5G capex `7,500-10,000 crore THE MASTER Vice-President M Venkaiah Naidu (left) presents the Dadasaheb Phalke Award to actor Rajinikanth at the 67th National Film Awards presentation ceremony on Monday POWER POINT company will get a cash flow relief of about `35,00040,000 crore by opting for the four-year AGR and spectrum payment moratorium. He had said this amount would be investedbackintothenetwork for 5G etc. Continued on Page 12 ● NEW FRANCHISES RPSG gets new IPL team for `7,090 cr, CVC Capital claims second PRESS TRUST OF INDIA Dubai, October 25 KOLKATA-BASED BUSINESS tycoon Sanjiv Goenka’s RP-SG Group claimed the Lucknow franchise for a whopping `7,090-crore while international equity investment firm CVC Capital won the bid for Ahmedabad with a `5,600crore offer as the eagerlyawaited two new IPL teams wereunveiledhereonMonday. The BCCI was expecting a windfall in the range of `10,000 crore but to theirsurprise earned `12,690 crore from the two new teams that will take part in the 2022 IPL. PTIhadreportedonSunday that Goenka is one of the favourites to win a team after having been in the IPL for two years in 2016 and 2017 when he owned the Rising Pune Supergiants. “Yes, RPSG had the highest bid of `7,090 crore while CVC had the second highest bid at `5,600 crore. The BCCI stand to earn around $1.70 billion from the deal,” a senior BCCI source present in Dubai told PTI on conditions of anonymity. Continued on Page 2 86.49 86.2 86.0 REUTERS London, October 25 Bharti has 90 days after October 29 to decide on paying accrued interest via equity to govt ■ Total interest amount to come to around Brent ($/bbl) 86.6 Previous close: 85.53 86.4 Discoms need to pay dues on time: Singh Warns coal crisis will recur unless discoms mend their ways; dues to gencos stand at `75,000 cr “Unless and until the distribution entities pay for the power procured on time, the problem will remain because gencos will not be able to pay for coal.” “Discoms' dues to power producers is around `75,000 crore. How do you expect them to pay for coal, railway freight, service their loans, pay workers’ salaries? This is not sustainable.” FE BUREAU New Delhi, October 25 UNLESSTHE STATE-RUN electricitydistributionentities(discoms) mend theirways and pay power companies on time, the lattermaybepushedtodefaulting on coal payments, and fuel criseslikethecurrentonemight recur,Unionministerforpower, new and renewable energy RK Singh said on Monday. “Power plants owe huge quantum of money to Coal India (CIL),so naturally,it (CIL) getsintodifficulty,”Singhsaid. HeaddedthattheUnionpower ministry would soon write to thestategovernmentsanddiscoms,askingtocleartheirdues to gencos — `75,000 crore at LARGE CENTRAL PUBLICsector entities — companies and undertakings — achieved 37% of theiraggregate capital expenditure target forFY22 in the first six months of the current financial year, by spending`2.19lakhcrore,according to official sources. However, these entities are likely to fall behind the finance ministry’s directive to achieve 90%of the FY22 target by December. Theircapexwas 30% of the annual target in the corre- `2.19 lakh crore Or 37% of FY22 capex target achieved in H1 ing enough before the monsoonandlowalternativesupply of coal. The fuel deficit, the gravestinrecentyears,resulted in electricity supply shortage rising to as high as 114.5 million units (MU) on October7. Continued on Page 2 Top state-run investors in H1FY22 Achievement (` crore) As % of FY22 target NHAI 64,000 52 Railways 63,000 32 NTPC 12,000 50 IOC 12,000 41 ONGC 11,000 37 Data for entities with minimum `500 crore annual capex sponding period of FY21. Fixedinvestment,onwhich the government bets,rose by a sharp 55.3% in Q1FY22 to 85.2 85.0 Open @IST5:54 PM Both benchmarks closed last week with slight gains despite rising coronavirus cases in Britain and Eastern Europe,signallingapotentially difficult winter ahead. Continued on Page 12 Sensex rises, but rupee skids MARKETS FOUND firmer ground on Monday after a four-session losing streak, boosted by a rally in ICICI BankwhichpostedrecordQ2 profits, reports PTI. Sensex ended 145.43 points higher at 60,967.05, while Nifty advanced 10.50 points to 18,125.40.The rupee, however,fellby18paisetocloseat 75.08 against the dollar due to a spike in crude oil prices and a stronger greenback in the overseas markets. ■ RelatedreportsonPage9 FE BUREAU Bengaluru, October 25 CPSEs achieve 37% of FY22 capex target in H1, may miss stiff Dec goal Capex by CPSEs and departmental undertakings 85.4 Groww’s valuation grows to $3 billion SLOW SPENDS PRASANTA SAHU New Delhi, October 25 85.65 85.6 $251-M FUNDING —RK SINGH, UNION MINISTER FOR POWER & RENEWABLE ENERGY last count — at the earliest. Currently, coal stock at power plants is 8.1 million tonne (MT),up from 7.5 MT on October 19. Low fuel stock levels at power plants in recent weeks are being attributed to higher coal usage in July-September,powerplantsnotstock- OIL PRICES EXTENDED preweekend gains on Monday to hit multi-year highs, lifted by tight global supply and strengthening fuel demand in the US and beyond as economies recover from pandemic-induced slumps. Brent crude futures rose by $1.10, or 1.3%, to $86.63 a barrel, the highest since October 2018 on Monday. US West Texas Intermediate (WTI) crude futures rose $1.46, or 1.7%, to $85.22 and reached their highest level since October 2014. 85.8 raise its share in GDP by over 7 percentage points to 31.6%. Continued on Page 12 ONLINE INVESTMENT AND wealth management platform Groww on Monday said it has raised $251 million in equity financing at a valuation of $3 billion,led byCalifornia-based venture capital (VC) firm ICONIQ Growth. The round also saw participation from investors like Alkeon,Lone Pine Capital and Steadfast. Groww’s existing investors Sequoia Capital,RibbitCapital,YCContinuity,Tiger Global, and Propel Venture Partners also participated in the round. This is Groww’s sixth financing round,and to date,it has raised capital worth $390 million from multiple VCs and PE investors. Its last fundraise was an $83-million round led byTigerGlobalinAprilthisyear whenitwasvaluedat$1billion. The online trading and investment segment has seen INVESTOR INTEREST This is Groww’s sixth financing round; it has raised $390 million till date Its last fundraise was an $83-million round led by Tiger Global in April The online investment firm was then valued at $1 billion heightened competition in the past few months and a large number of funding rounds and acquisitions. Continued on Page 12 Bio E, US in $50-m vaccine financing deal THE US and pharma companyBiologicalEonMonday said they had finalised a financing arrangement for $50 million to expand the vaccine maker’s capacity to produce Covid-19 shots, reports Reuters.The agreement was struck in March when leaders of the United States, Australia, Japan and India — the so-called ‘Quad’ countries — met during a virtual summit. ■ Page 4 INTENSE SCRUTINY Ma’s Alibaba has lost $344 billion in world’s biggest wipeout JEANNY YU October 25 FEW PEOPLE COULD have predicted the downward spiral forAlibaba Group Holding, when founder Jack Ma delivered a blunt criticism of China’s financial system last October. Yet one year on, the technology titan has lost a whopping $344 billion in market capitalisation — the biggest wipeout of shareholder value globally, accord- Value losses Alibaba lost most market value in the past year globally ($ billion) -344.4 Jack ma Alibaba Group Holding -104 -66.1 -65.4 -63 -50.8 -50.3 -40.9 -39.1 -36.7 Kuaishou Technology Ping An Insurance Group Co of China Tencent Holdings Zoom Video Communications China Life Insurance KE Holdings SoftBank Group TAL Education Group RLX Technology Note: The ranking universe include all members of the MSCI Emerging Markets Index and MSCI World Index; Source: Bloomberg ing to data compiled by Bloomberg. Shortly after the now infamous speech, Beijing suspended the listing of its fintech arm Ant Group and has since followed up with a widespread crackdown on the country’s most vibrant sectors — causing Chinese stocks to tank. Alibaba shares sank from an all-time high that month to a record low three weeks ago in Hong Kong, as Beijing stepped up its scrutiny of the company’s practices and urged a restructure of its fintech business. Despite a 30% recovery from October 5, the stock is still 43% lower than its October 2020 peak. Bloomberg Intelligence expects fiscal second-quarter active users at the e-commerce giant to have beaten consensus projections as a result of China’s zero-Covid policy. Alibaba is set to report earnings on November 5. —BLOOMBERG CHENNAI/KOCHI
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