BACK PAGE, P18 COMPANIES, P4 INTERNATIONAL, P12 ROAD TO PARIS BATTERIES NEAR END OF LIFECYCLE DELIVERIES DECLINE Sift Kaur wins in first Olympic selection trials in Rifle 3P E-waste recycling startups look to cash in on EV opportunity Boeing reports first revenue drop in seven quarters MUMBAI, THURSDAY, APRIL 25, 2024 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL LXIV NO. 98, 18 PAGES, `12.00 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: 73,852.94 ▲ 114.49 NIFTY: 22,402.40 ▲ 34.40 NIKKEI 225: 38,460.08 ▲ 907.92 HANG SENG: 17,201.27▲ 372.34 `/$: 83.32 ▲ 0.02 `/€: 89.03 ▼ 0.20 BRENT: $88.00 ▼ $0.42 GOLD: `71,700 ▲ `385 SME IPO INDEX HITS FRESH LIFETIME HIGH UNDETERRED BY REGULATORY concerns around valuations and manipulation in some counters, the SME-IPO index hit a fresh lifetime high of 66,396.09 points on Wednesday, reports Vivek Kumar M. ■ PAGE 10 RBI FOR GREATER VIGILON FOREX TRANSACTIONS THE RBI ON Wednesday asked banks to exercise greater vigilance to prevent unauthorised forex transactions. ■ PAGE 17 EXPLAINER Why the US wants to outlaw TikTok ■ PAGE 9 SACHIN KUMAR Mumbai, April 24 THE RESERVE BANK of India (RBI) on Wednesday barred Kotak Mahindra Bank fromonboardingnewcustomersviaitsonline and mobile banking channels,and from issuing new credit cards. In a notification under Section 35A, the bankingregulatorsaidthatithasfoundserious deficiencies and non-compliances by the private lender in Information Technology (IT) risk INSIDE andinformationsecurity RBI walks governance. However, the walk on the country’s fourth compliance, largestprivatelendercan again ■ PAGE 10 continue to provide services to its existing customers, including its creditcardusers.KotakMahindraBank’sonline portfolio is significant. Around 95% of the bank’snewpersonalloanvolumes,around99% of new credit cards and 79% of new business loansare through the digitalchannels.It is also the country’s fifth largest credit card issuer. “For two consecutive years, the bank was assessed to be deficient in its IT Risk and Information Security Governance,contrary to requirements under regulatory guidelines,” stated RBI in the notification. During the subsequent assessments, the bank was found to be significantly non-com- ■ Around 95% of Kotak’s new personal loan volumes are disbursed digitally ■ Around 99% ofnew credit cards and 79% of new business loans are through digital channels action has been taken on Bank of Baroda, Paytm Payments Bank, IIFL Finance and JM Financial Products over the past six months ■ The RBI said these restrictions are imposed on the bank in the interest of customers Kotak Bank's response THE BANK HAS TAKEN MEASURES FOR ADOPTION OF NEW TECHNOLOGIES TO STRENGTHEN ITS IT SYSTEMS AND WILL CONTINUE TO WORK WITH RBI pliantwith the CorrectiveAction Plans issued bytheReserveBankfor2022and2023,asthe compliances submitted by the bank were foundtobeeitherinadequate,incorrectornot sustained,added the central bank. Continued on Page 12 RESULTS Tesla’s India factory plans may run out of charge SWARAJ BAGGONKAR Mumbai, April 24 TESLA'S PLANSTO build an assemblyline in India underthe government's newelectric vehicles policy,may get delayed as the company has announced that it will focus onutilisingits existingfactories to produce new, more affordable vehicles later this year. The newproduct range,which the company has planned for launch in early 2025,includes the ‘more affordable’ models it has been working on for emerging markets like India. Model 2, that is popularly ELON MUSK, CEO, TESLA (NEW MODELS ARE) NOT CONTINGENT UPON ANY NEW FACTORY OR MASSIVE NEW PRODUCTION LINE. known to be the‘$25,000Tesla’is one of these models. In a post earnings conference call onTuesday,CEOElonMusksaid,“(New models are) not contingent upon any new factory or massive new production line. Continued on Page 12 ■ OPM 190 (% bps, y-o-y) Q1 Q2 Q3 Q4 -420 ■ Similar ■ Net sales (% chg, y-o-y) -140 BIG BLOW THE EARNINGS SEASON has got off to a modest start with most companies and banks reporting results in linewith expectations.Amongthe93early birds, only Bajaj Auto has beaten estimates while Hindustan Unilever has REVIEW beena bigdisappointment. The FMCG major’s sales grew just 3% y-o-y while net profits were down 5.5% y-o-y. Net sales for the sample were up a strong 17.4%, some of it due to a 29% jump in the revenues of Bajaj Auto. Operating margins, however, were down 420 bps y-o-y,as total expenditure went up by a sharp 24%.Despite ahuge boost (190%) Continued on Page 12 SUBDUED START -15 Barred from onboarding new customers in credit card, online businesses in other income and a drop in raw material costs,net profits forthe samplewere up 12.6% y-o-y. TheITpackputupanordinaryshow.TCS reported a rise in revenues,in constant currencyterms,of1.1%q-o-q,justaboutinline with estimates.However,the costoptimisationinresources helpedthemarginsexpandby a sharp 100 bps q-o-q and 150 bps y-o-y. Importantly, deal wins during the quarter wereexceptionallystrongat$13.2billion. Infosys reported a revenue decline of 2.2%,missing estimates.Moreover,the 13% revenue guidance for FY25 is lower than the earlier 4-7%, suggesting discretionary spends are expected to stayweak. 17.4 THE CENTRE HAS drawn up a plan to streamline and strengthen incentive schemes for the micro, small, and medium enterprises, reports Prasanta Sahu. ■ PAGE 2 FE BUREAU New Delhi, April 24 13.4 CENTRE LOOKS TO STREAMLINE MSME SCHEMES Now, Kotak Bank in RBI crosshairs Margin worry for early birds 7.7 NEWS RBI CITES 2 YEARS OF NON-COMPLIANCE 11.8 IN THE Q1 Q2 Q3 Q4 ■ Net profit (% chg, y-o-y) 3.2 Q1 21.1 11.4 12.6 Q2 Q3 Q4 Sample of 93 firms, banks; Source: Capitaline RESULTS CORNER HUL Q4 profit misses estimate HINDUSTAN UNILEVER SAW its fourth-quarter standalone net profit fall nearly 6% y-o-y to `2,406 crore, missing Street estimates,as the company struggled with weak rural demand,reportsViveatSusanPinto. ■ Page 4 Loan, NII growth buoy Axis in Q4 AXISBANKREPORTEDfourth-quarter profit above estimates on Wednesday, helped by strong loan growth and higher lending income, reports Reuters. ■ Page 10