OPINION, P6 COMPANIES, P4 SIDDHARTH PAI Technical innovations blurring the line between manus & machina INTERNATIONAL, P8 EDITORIAL KEY TO WINNING DEALS FRESH LAWSUIT Front-loading rate hikes will better tame inflationary pressures IT firms sharpen focus on environmental, social, governance framework Musk sued by Twitter investor over busted $44-billion deal KOLKATA, TUESDAY, AUGUST 2, 2022 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL 31 NO. 232, 16 PAGES, `10.00 (NORTH EAST STATES & ANDAMAN `10.00) P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E SENSEX: 58,115.50 ▲ 545.25 NIFTY: 17,340.05 ▲ 181.80 NIKKEI 225: 27,993.35 ▲ 191.71 HANG SENG: 20,165.84 ▲ 9.33 `/$: 79.03 ▲ 0.24 `/€: 81.12 ▼ 0.23 BRENT: $100.46 ▼ $9.55 GOLD: `51,520 ▲ `219 THE GOVERNMENT will likely review the windfall taxes on domestic crude and exports of diesel and aviation turbine fuel in a day or two, revenue secretary Tarun Bajaj told fe Bureau in New Delhi on Monday. P2 IMD predicts normal monsoon in Aug-Sept MONSOON RAINFALL in the August-September period is expected to be in the ‘normal’ range, the India Meteorological Department (IMD) said on Monday, reports Sandip Das in New Delhi. P2 FE SPECIALS Margin pressure is likely to persist for HDFC EPS for FY23/24/25e down by 3/1.6/1%; ‘Buy’ retained with a target price of `2,850 ■ Investor, P7 Tech making science easier to understand The TutAR app allows teachers to explain basic science concepts by using augmented reality ■ eFE, P7 24,740 MHz RELIANCE JIO EMERGED as the top spectrum buyer in the 5G auctions,which concluded onMondayafterdraggingonfor seven days. Spending `88,078 crore,Jio acquired 24,740 MHz spectrum across bands. The telco’stotalspectrumholdingis now higher than rivals Bharti Airtel andVodafoneIdea. The government mopped up a little over`1.50 trillion in the auctions. Of the total 72 GHz spectrum put up for auction, 51 GHz was sold, which means 29% remained unsold. This is far better compared with the past two auctions when more than 60% spectrum remained unsold. This shows that the overall reduction of reserve price of about 39% by the Telecom Regulatory Authority of India (Trai) yielded positive results. Barring the 1800 MHz band, for which Jio and Bharti Airtel engaged in fierce bidding and which dragged the auction for seven days, spec- 19,867 MHz spectrum for spectrum for 6,228 MHz spectrum for `88,078 `43,084 `18,799 crore crore crore 51 GHz 400 MHz spectrum for `212 crore ■ Upfront amount govt will get as first-year instalment: `13,365 cr ■ Allocation of spectrum to operators by Aug 10 ■ Services to start by October-September RELATED REPORTS Well prepared to launch 5G services on time: Telcos P4 Sector likely to see `2-3-trn investments in 2 yrs: Vaishnaw P4 trum in all bands were sold at the reserve price. Telecom minister Ashwani Vaishnaw said the governmentwill complete the allocation process of the spectrum to the operators byAugust 10. He added that the operators should be able to place orders for equipment by SeptemberOctober, by when 5G services can be launched.The minister further said there would be significant 5G coverage across the country in the next two-three years. Continued on Page 2 FE BUREAU New Delhi, August 1 CGST 6.6 SGST 6.96 THE GOODS AND services tax (GST) collections came in at `1.49trillioninJuly(Junetransactions),up28%onyear,thanks to resurgent economic activities,improvedcompliance,high inflation and a broadening of the tax base. The collections crossed the `1.4-trillion mark forthefifthstraightmonth.The July mop-up was also the second-highestin anymonth. The monthly average mopup in April-July was an impressive `1.5 trillion, up 35% on year. If this pace is sustained throughMarch2023,grossGST receipts in the current financial year, including compensation (` trillion) ■ Budget estimate ■ Extra collections likely over BE* 1.4* 1.6 SGST (` trillion) Gross GST collections 2022 (` trillion) CGST *Net to the Centre may be `82,000 crore higher than relevant BE after factoring in 41% devolution to states 1.49 FE BUREAU New Delhi, August 1 72 GHz TOTAL SOLD FY23 gross GST receipts 1.45 TOTAL SPECTRUM FOR AUCTION ON THE RISE 1.41 GETTING 5G-READY Collections cross `1.4-trn mark for fifth straight month 1.68 Govt mops up `1.5 trillion as auctions conclude At `1.49 trn,GST mop-up second-highest in July 1.42 Second review of windfall taxes soon: Revenue secretary Jio top 5G bidder with `88,078 cr MONDAY SAWA STRING OF GOOD NEWS, WITH ATRICKLE-DOWN EFFECT ON MARKETS 1.33 TWO PUBLIC sector banks and as many private sector banks on Monday raised their marginal cost of funds based lending rates (MCLR) in the range of 10-15 basis points (bps), ahead of the monetary policy meeting of Reserve Bank of India (RBI), reports fe Bureau in Mumbai. P9 TELCO BUYS 24,740 MHz SPECTRUM 1.41 IN THE NEWS Four banks hike MCLR ahead of RBI policy meet Jan Feb Mar Apr May June July cess proceeds, may exceed the estimate by a neat `3 trillion, allowingtheCentretoappropriateanadditional`80,000crore afterdevolution to the states. The gross GST collections bythe Centre and states,going by the Union Budget, are estimated at `14.76 trillion — `6.6 trillion as central GST, `6.96 trillion as state GST,and cess of `1.2 trillion. Continued on Page 2 PV wholesales at record high in July Benchmarks rally as auto stocks shine WITH DEMAND remaining strong and the semiconductorsupplybeingmuchbetter,the auto industry registered the highest-ever monthly wholesale despatches of passenger vehicles (PVs) in Julyat 342,326 units ■ Report on Page 4 SHARES KICKED off August on a positive note, with the benchmark indexes hitting three-month highs, led by a rally in automobile stocks on the back of robust monthly sales data. ■ Report on Page 9 ...India's position is much better than most others. Inflation does exist here, but at what level? The economy is in a much better situation now than where it was after global financial crisis or taper tantrum. —NIRMALA SITHARAMAN, FM REPORT ON P2 Manufacturing activity hits 8-month high MANUFACTURINGACTIVITIES SCALED an eight-month peak inJulyasneworderintakesrose substantially, recovering the growthmomentumlostinJune, amid improving demand, reportsfeBureauinNewDelhi. The seasonally-adjusted S&P Global India Manufacturing Purchasing Managers’ Index jumpedto56.4inJulyfrom53.9 in the previous month. Page 2 Zomato transitioning to multiple CEO structure FE BUREAU New Delhi, August 1 WITH FOUR COMPANIES in its kitty, food tech major Zomato is looking to have a multiple CEO structure for these businesses and may name the larger organisation, Eternal,for internal purposes. “We are transitioning from acompanywhereIwastheCEO to a place where we will have multiple CEOs running each of our businesses, all acting as peers to each other, and working as a super team with each other towards building a single large and seamless organisation,”DeepinderGoyal,founder and CEO of Zomato, wrote on the company’s Slack channel last week.The post came after shareholders approved its acquisition of Blinkit. Goyal is understood to have said going forward, the combined larger organisation with Zomato,Blinkit,Hyperpureand "We are transitioning from a company where I was the CEO to a place where we will have multiple CEOs running each of our businesses...all acting as peers to each other." —DEEPINDER GOYAL, CEO, ZOMATO Zomato loss nearly halves in Q1FY23, revenues jump 68% ● REPORT ON PAGE 4 Feeding India may be termed Eternal.“Now that the ZomatoBlinkitdealisapproved,wehave three companies — Zomato, Blinkit and Hyperpure — in the orderofbusinesssize/impact.In addition to these three,we also have Feeding India.We are now at a stage of life where we are maturing from running (more orless) a single business to runningmultiplelargecompanies,” Goyalwrotein the message. Continued on Page 2 AMID DOLLAR FALL, US GDP CONTRACTION FPIs return to Indian equities ASHLEY COUTINHO Mumbai, August 1 AFTER NINE CONSECUTIVE months of outflows, the net flows from foreign portfolio investors(FPIs)intoIndianequities turned net positive in July. India’s equity market, just like others around the world, seems to be benefiting from a host of bad news emanating from the US, whose GDP contracted fora second successive quarter, entering a technical recession in the process. Market pundits are now hopingthataweakUSeconomy would slow the pace of monetary tightening by the US Federal Reserve,and probably lead to a pause in rate hikes byOctober.The reading is that a recession will bring down commodity prices and inflation, obviating the need to jack up rates further. Whenever interest rates go up in the US, the emerging Turning the corner? FPI flows into equities turned net positive in July ($ billion) Equity Debt 1 0.6 0 0.4 -1 0.5 0.7 -2 0.6 0.2 0.7 0.2 2.2 -3 -4 -5 4.5 4.7 -6 -7 Jan 2022 Feb 5.1 5.3 Mar Apr May 6.4 Jun Jul 2022 Source: NSDL markets look like a riskier bet, leading to outflows. The reverse is true as well. “FPIs are back due to an uptick in risk-on trade amid the dollar’s fall and the expectation that interest rates will not rise as quickly at the back end of the year as originally thought. That's why markets are rallying globally and emerging markets like India are a beneficiary,”AndrewHolland, CEO, Avendus Capital Public Markets Alternate Strategies,said,addingthatthe markets saw a fair bit of short covering by FPIs last week. The dollar hovered near a three-week low to major peers on Monday, with the dollar index, which measures the currency against six counterparts, ruling at 105.58, a one percentage point retreat over the last five days. “Global markets are rebounding from very low levels of risk appetite. Rolling 12 month flows as a percentage of market capitalisation had reached levels only better than the global financial crisis. Somewhat expectedly,flows to severalmarketsturnedpositive in the past week.While a sentiment switch to ‘bad news is good news’, a lag between expectation and appearance of poor economic data may mean the rebound lasts long enough to test investor patience,” Neelkanth Mishra, co-head of equitystrategy,AsiaPacificand India equity strategist, Securities Research, at Credit Suisse, said in a recent note. Continued on Page 2 Kolkata
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