BRANDWAGON, P7 COMPANIES, P4 INTERNATIONAL, P9 NEW BRAND POSITIONING `5,000-CRORE INVESTMENT NEW BEGINNING Working to increase female football fans in India: MD, LaLiga India Aditya Birla Group forays into branded jewellery segment Twitter's new CEO Linda Yaccarino logs first day in role NEW DELHI, WEDNESDAY, JUNE 7, 2023 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL XLIX NO. 84, 30 PAGES, `10.00 (PATNA & RAIPUR `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: 62,792.88 ▲ 5.41 NIFTY: 18,599 ▲ 5.15 NIKKEI 225: 32,506.78 ▲ 289.35 HANG SENG: 19,099.28 ▼ 9.22 `/$: 82.61 ▲ 0.07 `/€: 88.34 ▲ 0.6 BRENT: $75.54 ▼ $1.17 GOLD: `59,864 ▲ `437 AS PART OF its probe into the Odisha train accident, the Central Bureau of Investigation on Tuesday visited the Bahanaga railway station, its panel room, record room and relay room, and spoke to staff present there, reports Ravik Bhattacharya. ■ PAGE 20 IMD predicts heat wave next five days THE IMD ON Tuesday predicted heat wave conditions over Bihar, Jharkhand, West Bengal, Andhra Pradesh and Telangana over the next five days, which is expected to delay the land preparation for the forthcoming kharif crops such as paddy and pulses, reports Sandip Das. ■ PAGE 3 ‘Global economy in precarious state’ THE GLOBAL ECONOMY is in a precarious situation and heading for a substantial growth slowdown as sharp interest-rate increases hit activity and stir vulnerabilities in lower-income countries, the World Bank said. ■ PAGE 9 Malware attack at AIIMS neutralised A MALWARE ATTACK was detected at AIIMS on Tuesday but the threat was neutralised by the deployed cybersecurity systems at the institute, authorities said. then need to form joint ventures with Indian firms as post-2020 borderclashes, India discourages 100% Chinese investments. Analysts said that Tesla would drive a hard bargain with India as China is also currently courting Musk on retaining its investments in the country. Musk had recently visited China and met the top leaders there. As earlier reported by FE, the governmenthasaskedTeslatosubmit aroadmap Sequoia Capital splits into three; India & SEA fund to be rebranded SALMAN SH Bengaluru, June 6 VENTURECAPITALFIRMSequoiaCapitalis splitting into three entities focused on geographiesincludingtheUnitedStates,China, IndiaandSouthEastAsia. TheVCfundsaidinastatementonTuesdaythatovertheyears,thestrategiesforeach businessdivergedandthatitsscaleandmarket leadership across different geographies hadstartedtoresultinbrandconfusionand portfolioconflict,compellingtheVCfundto splitintothreeindependentfunds.Sequoia India & Southeast Asia (SEA) will be rebrandedasPeakXVPartnersandwilloperateasafullyindependentfirm.TheIndiaand SEA-focused fund had last raised $2.85 billioninJuly2022toinvestinearly-stage,ventureandgrowthdealsinbothgeographies. “Our firm will continue to be managed bythepresentleadershipteamandwillcontinuetoinvestfromthemostrecentlyraised set of funds focused on India and SEA,” said Shailendra Singh, managing director, SequoiaCapitalIndia&SEAinastatement. SHAILENDRA SINGH, MD, SEQUOIA CAPITAL INDIA & SEA Our firm will continue to be managed by the present leadership team and will continue to invest from the most recently raised set of funds focused on India and SEA Continued on Page 2 BoB’s proposed deal values NSE at `1.57 trn Apple unveils $3,500 headset as it wades ■ PAGE 9 into VR EXPLAINER An SRO for India’s mututal funds ■ PAGE 20 FE S P E C I A L Know the final cost of your home Besides purchase price, consider interest costs, stamp duty & other fees ■ PERSONAL FINANCE, P7 APROPOSED stake sale bya public sector bank on Monday has put the spotlight on the valuations of the National StockExchangeofIndia(NSE),thecountry's largest bourse, reports Ashley Coutinho. State-run Bank of Baroda (BoB)'s proposed auction to sell 2.1 million shares, or a 0.42% stake, at a floor price of `3,150 per share pegs the bourse's value at about `1.57 trillion ($19.2 billion).This is a 16-19% discount to the price of `3,650-3,750 that was being quoted in late 2021, which translated to a valuation of roughly `1.87 trillion ($25 billion). ■ Page 8 on the time-frame needed by it to set up an indigenous supplychain.The company is expected to submit the same in the next three to six months time. Officialstold theTeslateam,whichvisited the country last month, that till the time the companysets up its supplychain here, the government is willing to offer import concessions on the components required for the same. Continued on Page 2 Byju's skips $40 mn loan repayment; sues lenders SALMAN SH Bengaluru, June 6 BYJU'S SKIPPED ITS quarterly interest payment of $40 million on the $1.2 billion term loan B (TLB), which was due on June 5, and instead filed a lawsuit in the NewYork Supreme Court challenging the acceleration of the repayment and seeking disqualification of Redwood, one of the lenders.The company said that it has decided not to make anyfurtherpayment to theTLB lenders,including anyinterest, until the dispute is decided by the court. The edtech majorhas alleged that contrary to the terms of TLB, Redwood purchased a significant portion of the loan whileprimarilytradingin distresseddebt. The company said that it had to file the lawsuit as lenders had adopted predatory tactics,led by Redwood. “On March 3 2023, the TLB lenders unlawfully accelerated the TLB on account of certain alleged non-monetaryand technical defaults. On the back of this unconscionable acceleration of the TLB, the TLB lenders undertook unwarranted enforcement measures, including seizing control ofByju’sAlphaandappointingitsownmanagement.Notrestingcontentwiththis,the TLB lenders (acting through their agent, GLAS Trust Company) commenced litigation in Delaware in an attempt to lend credence to these actions,” Byju's said in a statement.Theinterestrepaymentsaredue as creditors have called off negotiations withByju’sonrestructuringthecovenants of the term loan.The lenders had earlier movedaDelawarecourtallegingthatByju's concealed$500millionincashthroughits US-based subsidiary,Alpha. Continued on Page 2 100,000 75,000 50,000 25,000 0 4,000 3,235 125,000 3,381 Average sales per day (RHS) 540 submit a roadmap on the timeframe needed to set up an indigenous supply chain in three to six months Total sales 104,824 ■ The company is expected to more than half of Tesla's global production happens in China (Shanghai) where it has developed a large vendor base DOMESTIC SALES 2,224 ■ Currently, SALES OF ELECTRIC two-wheelers have crashed to just one-fourth of the average daily volumes from the levels seen before the reduction of incentives by the government from June 1. From 2,000-3,300 units per day in January—May, sales volumes of electric twowheelers are down to 540 units perdayin the first six days of June,as perdata sourced from the government-controlled Vahan portal which provides actual vehicle registrations. Manufacturers including Bajaj Auto,TVS MotorCompany,OlaElectric,AtherEnergyand GreavesElectricMobilityhaveincreasedprices between `10,000-40,000 from June 1 followingthereductioninthegovernmentsubsidyto `10,000 perkWh from `15,000 perkWh.The Society of Manufacturers of Electric Vehicles (SMEV),the apex lobby body of the EVmakers, said that some manufacturers are taking the pricehikeburdenontothemselvestosoftenthe blowof the sudden hike. SohinderGill,DirectorGeneral,SMEVsaid, “Thisisdefinitelyahittothecustomers.While thesubsidycutrangesfrom`22,000-37,000, most players are offering an additional price adjustment (out of their pockets) between `12,000-22,000 to partially adjust the impact of subsidyreduction.Thiswill directly impact their profitability.” Chennai-based TVS Motor Company announcedthatitwillnotpassonthefullburdenofthepricerevisiontoitscustomersinone 66,740 start with domestic assembly of cars and later follow it up by setting up a vendor base SWARAJ BAGGONKAR Mumbai, June 6 2,781 ELON MUSK'S TESLA has in-principle agreed to the suggestion put forward by the Centre that apart from assembling its electric vehicles in the country, it also set up a vendor base here. However, the government has said that the company can first start with domestic assembly of cars and later follow it up by setting up a vendor base. IndicationsarethatTeslamaynotdelay the setting up of the domesticvendorbase much as it does not believe in decoupling manufacturing and supplychain. Currently, more than half of Tesla's global production happens in China (Shanghai) where it has developed a large vendor base. It has also recently built a megapack battery factory there. If the companystarts a manufacturing base in India, it would mean relocating thesevendors to India.Thevendorswould China to discuss Tesla's existing investments in the country 2,354 MUKESH JAGOTA New Delhi, June 6 ■ Musk was recently in 86,220 CBI starts Odisha crash probe Musk may bargain hard INDIA CALLING ■ The government as China tries to retain has said that US firm’s investments Tesla can first Daily offtake down to 540 in June so far from 2,0003,300 in January-May 65,923 FITCH GROUP UNIT CreditSights analyst Lakshmanan R, who kicked off scrutiny of Adani Group’s finances nearly a year ago by terming the conglomerate “deeply overleveraged” has upgraded his view, saying some of the Indian billionaire’s firms now have better metrics. ■ PAGE 4 Tesla agrees to set up vendor base in India Electric 2W sales crash as subsidy cut kicks in 2,081 Adani debt metrics get CreditSights analyst’s upgrade PLI 2.0 FOR EVs LIKELY TO SWEETEN THE DEAL 64,522 IN THE NEWS Jan Feb Mar Apr May Jun* *Till June 6 3,200 2,400 1,600 800 0 Source: Vahan go.However,OlaElectricsentoutnotifications to customers seeking additional payments as a result of the newprices forbookings done in May. A Mumbai-based electric two-wheeler dealersaid,“So farthis month,there has hardly been any new bookings and enquiry levels are also very poor. It will take 2-3 months for the market toabsorb the newprices.” Ayush Lohia, CEO, Lohia Auto said, “The government’s decision to slash subsidies has undeniably triggered a significant impact on thedemandforEVs.Thesubsequentpricehike resultingfromthispolicychangehascreateda challengingenvironmentfortheindustryasa whole.” Continued on Page 2 Thyssenkrupp to bid for Navy submarine deal ALEXANDER RATZ & CHRISTOPH STEITZ New Delhi, June 6 to wean New Delhi from its dependence on Russian gear. Earlier,Pistorius met his counterpart RajGERMANY'STHYSSENKRUPPIS likelyto bid nath Singh, at a time when the South Asian for a project to supply six submarines for the nation is looking to boost domestic defence Indian Navy, German manufacturing as it aims defence ministerBoris PistocounterChina'sgrowing BORIS PISTORIUS, DEFENCE torius said on Tuesday, presence in the Indian MINISTER, GERMANY during avisit to NewDelhi. Ocean. Thyssenkrupp's marine "We talked about a conarm is expected to sign the We talked about a crete cooperation in milideal with Mazagon Dock tary procurement. That concrete cooperation Shipbuilders on Wednescould be six submarines day, a source familiar with in military procurement. fromTKMS,"Pistoriussaid, the matter told Reuters. referring to the firm's That could be six German newspaper marinearm."Thatcouldbe Frankfurter Allgemeine submarines from TKMS a lighthouse project." Zeitung had first reported (ThyssenKrupp's marine In March, India that an MoU between arm). That could be a approvedabudgetof`560 Thyssenkrupp and billion ($6.8 billion) for its Mazagon Dock Ship- lighthouse project navy, which has 16 conbuilders would be signed ventional submarines, 11 on Wednesday. of them more than two Mazagon Dock did not decades old, along with immediately respond to a two indigenous nuclearrequestforcommentwhile powered submarines. Thyssenkrupp declined to "India's skilled workcomment. force and competitive In February, Reuters costs along with Gerreported that Thyssenkmany's high technologies rupp would bid for the and investment can fur$5.2-billionprojectinabid therstrengthenties,"Singh to replace the Navy's agesaid in a statement that ing submarine fleet, did not refer to asWestern milithe subtary manufacmarines. turers attempt -- REUTERS RETAILERS BODY SAYS TREND MAY CHANGE IN RUN-UP TO THE FESTIVE SEASON Retailers’ mall rent set to rise 5-7%; to fall for mutiplexes VIVEAT SUSAN PINTO Mumbai, June 6 THE BULLISH OUTLOOK of retailers towards expansion has led to an increaseinmallrentalstothetuneof 5-7%thisyearcomparedtolastyear, conversations with mall owners across cities such as Mumbai, Delhi and Kolkata reveal. The cinema chains, on the other hand, are seeking to renegotiate rentals down to thetuneof10-15%fornewtheatres inmallsasfootfallsremainsluggish, especially for Hindi film content, mall owners say. "Box-office performance has beenachallengeformultiplexoperators especially in the Hindi segment, though south cinema is doing well," says Mukesh Kumar, MIXED TREND ■ Cinema chains are seeking to renegotiate rentals down to the tune of ■ Mall rents are ■ Store additions hiked every three years to the tune of show no signs of slowdown, as retailers bank on comeback in discretionary spending 10-15% 15%, for new theatres in malls but this year stands out as retail market faces a discretionary slowdown ■ Multiplexes are looking for the next big film after the success ofShah Rukh Khan-starrer Pathaan MD & CEO, Quest Properties India, who is also the chairman of the Shopping Centres Association of India,an apex body of mall owners. "Retailers, on the other hand, remain buoyant on account of a positive outlook they have towards the market,"Kumar said. While mall rents are hiked every three years to the tune of 15%, say experts,thisyearstandsoutbecause the retail market is actuallyfacing a discretionary slowdown in categories such as apparels and fastfood. This is due to inflationary pressuresandfinancialuncertainty, says Jaydeep Shetty, a Mumbaibased retail expert and consultant. Yet, store additions show no signs of slowing down, with most retailers banking on a comeback in discretionary spending during the second half of the year, which also coincides with the festive period. "FY23 saw rentals grow in double-digits because revenues kicked in for retailers quickly after the Covid-19 restrictions were completely lifted,"says Rajneesh Mahajan, CEO, Inorbit Malls India."This year, we expect rentals to grow in high single digits, which is coming on a strong base, when compared with last year,"he said. In a survey of the retail market last month, the Retailers Associa- New Delhi tion of India,an apex bodyof retailers, indicated that while year-onyear retail growth in April was 6%, this trend could change as consumption patterns could improve over the next few months with the onset of the festive season. Multiplexes, meanwhile, are looking for the next big film afterthe success of ShahRukh Khan-starrerPathaan in theearlypart ofcalendaryear2023. While announcing its Q4 results lastmonth,multiplexchainPVRInox, thelargestcinemachaininthecountry,said that it will be shutting down 50 screens over the next six months. It would also realign all upcoming handovers of new sites for fitouts till thebusinesscompletelyrecovered. Continued on Page 2
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