ECONOMY, P3 COMPANIES, P4 INTERNATIONAL, P7 An emission task for China: 66% reduction till 2030 Q-comm denting kirana sales: Delhivery CEO Lankan president's Leftist coalition sweeps elections HYDERABAD, SATURDAY, NOVEMBER 16, 2024 VOL. NO. XXI 169, 30 PAGES, `12.00 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: 77,580.31* ▼ 110.64 NIFTY: 23,532.70* ▼ 26.35 NIKKEI 225: 38,642.91 ▲ 107.21 HANG SENG: 19,426.34 ▼ 9.47 `/$: 84.41* ▼ 0.02 `/€: 88.80* ▲ 0.89 BRENT: $72.09 ▼ $0.47 GOLD: `73,281* ▼ `1,635 *As on Nov 14 IN THE NEWS GST COUNCIL MEET ON DEC 21 TO TAKE UP INSURANCE TAX THE GOODS AND Services Tax (GST) Council is likely to discuss the relief on GST on health and life insurance items as well as rejigging of rates on over 100 items as it is scheduled to meet at Jaisalmer in Rajasthan on December 21, sources told Priyansh Verma. ■ PAGE 2 RETAILAUTO SALES GROW 12% IN FESTIVE PERIOD AUTO SALES BY dealers to customers grew by about 12% during this year's festive season compared to the previous year, led by twowheeler sales on the back of strong rural demand, data from the Federation of Automobile Dealers Associations (FADA) showed on Friday, reports Reuters. ■ PAGE 4 FOREX RESERVES FALL FOR SIXTH STRAIGHT WEEK INDIA'S FOREX RESERVES dropped by $6.78 billion to $675.65 billion for the week ended November 8, the Reserve Bank of India (RBI) said on Friday, reports Anupreksha Jain. After hitting an all-time high of $704.89 billion in end-September, the foreign exchange basket has been on the decline for multiple weeks. ■ PAGE 6 FE S P E C I A L S Economy in a sweet spot, to grow 7.2% in 2024: Moody’s TRUMP WIN PROMPTS MOVE U-turn: CLSA backs India over China VIVEK KUMAR M Mumbai, November 15 Sees RBI sticking to tight monetary policy stance going into 2025 JUST A MONTH after reducing India’s overweight to 10% to increase exposure to China, Hong Kong-based brokerage firm CLSA has reversed its stand. The brokerage on Friday decided to go 20% above MSCI weight on India as it“no longer has sufficient conviction to maintain an above benchmark exposure on Chinese equities into 2025”. Interestingly, the brokerage’s U-turn comes just over a week after Donald Trump won the US presidential election. Pointing to the results of the elections,CLSAin its latest report titled‘Pouncing Tiger,prevaricating dragon’ said: “The most fundamental requirement in determining our China allocation was to understand policymakers’ motivation...After NPC’s (National People's Congress) plan to bail out local government debt, we have been left wanting, anxious that the motivation is more alignedwith the former than the latter,” CLSA said. On India, it said it is one of the few emerging markets where the relationship between corporate earnings growth and the changes in the pace of economic output holds true. This is despite the concerns over slowing earnings growth in the last two quarters. Not everyone,however,is as positive.Citigroup has downgraded India stocks to‘neutral’ from ‘overweight’, citing stalling earnings growth and pressure from foreign investors selling following China’s recent policy support measures, and said China could see an upside surprise if Beijing delivers on its policy stimulus. Citi has forecast India’s Nifty 50 index to touch levels of 25,000 by September 2025 —about 6% rise from hereon,while CLSA is projecting a 13% US dollar upside potential MSCI AC APAC CLSA weight ex JP weight Market/CLSA recommendation (%) 26.5 26.5 China Benchmark 18.6 15.8 Taiwan 15% underweight 17.8 21.3 India 20% overweight 15.4 11.6 Australia 25% underweight 9.3 11.7 Korea 25% overweight China vs India relative performance Base: September 2, 2024 = 100 130 Shanghai Comp (China) 120 110 118.49 100 93.09 90 Nifty Sept 2, 2024 Nov 15, 2024 Source: CLSA, MSCI (for Indian equities) over the next 12 months, based on its economic projections. While brokerage firms have said the foreign portfolio investors’ (FPIs) selling in India was primarily driven by the need to shift fund flows to China, some experts believe it was a play on US equities. Continued on Page 5 `1L-cr m-cap club sees 17 exits Uncovering hidden gem of the Konkan, called Ganpatipule India’s finest adventure bike can help you find India’s finest beaches and roads ■ MOTOBAHN, P9 Multi-year health cover offsets rising premiums Insurers are offering discounts of up to 18% on 3- to 5-year policies ■ PERSONAL FINANCE, P9 WITH BENCHMARK INDICES falling up to 10% from the peaks seen in late September, 17 companies—which had a market capitalisation of above `1 lakh crore at the time—have seen their m-cap drop to below that mark in less than two months. Among the 17 firms, IndusInd Bank and Suzlon Energy’s share prices slumped over 30% each between September 26 and November 14. ColgatePalmolive India, Hero MotoCorp, Tata Consumer, RVNL, Indus Towers, and Dabur India saw their m-cap drop by up to `27,000 crore during the period. —Kishor Kadam THE EXITS Market cap, Nov 14 (` crore) Suzlon Energy IndusInd Bank Colgate-Palmolive Hero Motocorp Tata Consumer Rail Vikas Nigam Indus Towers Dabur India ICICI Lombard IOB Solar Industries Jindal Steel Cummins India Zydus Lifesciences Bosch Polycab India Apollo Hospitals % fall* 76,858 79,231 73,703 92,077 91,559 87,529 85,497 89,936 92,211 93,624 90,419 89,467 92,265 96,402 99,817 94,762 98,602 -30.6 -30.0 -26.7 -23.9 -23.8 -19.5 -19.3 -18.9 -17.4 -15.8 -15.0 -14.7 -12.3 -10.3 -8.8 -6.6 -4.3 NEAR THE DANGER MARK Market cap, Nov 14 (` crore) 1,01,395 Cholamandalam Inv 1,01,461 Havells India Adani Energy Solutions 1,05,401 United Spirits 1,04,880 ICICI Pru Life 1,00,172 % fall* -26.6 -20.0 -15.3 -12.3 -11.5 *in share price between Sept 26 & Nov 14; Source: Capitaline AMID CONCERNS ABOUT urban demand moderation and many high-frequencyindicators signalling a slowdown, Moody’s Ratings on Friday retained its 7.2% economic growth projection for India for calendar year 2024,citing likely improvement in household consumption,a sustained pick-up in rural demand, rising capacity utilisation, and the government’s continued thrust on infrastructure spending. “Indeed, from a macroeconomic perspective,the Indian economy is in a sweet spot, with the mix of solid growth and moderating inflation.We forecast a 7.2% growthforcalendaryear2024,followedby 6.6%in2025and6.5%in2026,”Moody’s indicators signal steady economic momentum in Q3, says Moody’s GDP growth estimate for FY25 (in %) Moody’s 7.2 (2024) FE BUREAU New Delhi, November 15 HOW THEY ARE RATED ■ High-frequency GROWTH FORECAST Finance Ministry ■ Household con- 7 IMF sumption to grow on increased spending in festive season, pick-up in rural demand 6.5-7 Fitch 7.2 RBI 7.2 said in its Global Macro Outlook on Friday. The Indian economy had grown by 7.7% in 2023. Despite a near-term uptick, inflation should moderate towards the Reserve Bank of India’s (RBI) target in the coming months as food prices ease amid higher sowing and adequate foodgrain buffer stocks, the agency said. Potential risks to inflation from heightened geopolitical tensions and extreme weather events underscore the RBI’s cautious approach to policy easing. In October,the RBI stuck to its forecast thattheIndianeconomywillexpand7.2% in the fiscal ending March 2025 despite recent evidence showing activity starting to taper off. The RBI’s outlook is far more optimistic than the 6.5-7% growth projected bythe finance ministryeconomists. Continued on Page 5 NTPC-ONGC green JV leads race for Ayana Submits highest bid of $650 million SARITA CHAGANTI SINGH New Delhi, November 15 A JOINT VENTURE between NTPC Green Energy and ONGC Green Energy is the highest bidderforAyana Renewable Powerhaving bid about $650 million, two people involved in the deal told Reuters. The venture outbid JSW Energy for the renewable energy firm backed by quasi-sovereign wealth fund National Investment and Infrastructure Fund,the people said. Ayana Renewable Power, owned by NIIF, British International Investment Fund and GreenGrowthEquityFund,operatessolarand wind plants that produce 1,600 megawatt in India and has another 2,500 megawatt in such projects under construction. "After due diligence, NTPC Green Energy and ONGC Green Energyhave jointlydecided to acquire 100% stake of Ayana Renewable Power through a joint venture company,"one of the sources said. NTPC,ONGC,andAyana Renewable Power did not immediately respond to queries. A JSW Group spokesperson declined to comment. NTPC Green and ONGC Green signed an agreement in February this year to float an equal JV,the source said. Large power producers in the country are betting big on renewables and making pledges to expand their green energy capacities.The government has pledged to add 500 GREEN GOAL ■ Ayana Renewable Power is owned by NIIF, British International Investment Fund and Green Growth Equity Fund ■ NTPC-ONGC ■ It operates solar and wind plants that produce 1,600 MW in India and has another 2,500 MW under construction JV said to have outbid JSW Energy for the renewable energy firm gigawatt of clean energy by 2030 to reduce carbon emissions. NTPCGreen,anarmofstate-ownedpower firm NTPC,is targeting avaluation of as much as $10.8 billion in an initial offering next week, set to be India's third-largest IPO this year.ItwillsellallthesharesintheIPO-which will be open for bids from November 19-22 and plans to use the proceeds to repayits unit NTPC Renewable Energy's debt. ONGCGreen,aunitofstate-ownedOiland Natural Corp (ONGC),is expected to list in the current financial year. —REUTERS Unilever to cut fewer jobs in Europe UNILEVER IS CUTTING about 1,500 fewer jobs in Europe than initiallyanticipated and hiring about 1,000 people, primarily those affected by its cost-cutting drive, for its soon-to-be spun off ice cream business, the head of the company’s European Works Council told Reuters. The British company, whose shareholders include billionaire activist investor and board member Nelson Peltz, has been trying to streamline its business over the past year under CEO Hein Schumacher. Prior to his appointment, Unilever had underperformed for years and was criticised for allowing its brand portfolio to grow to around 400, leaving management with too little time to focus on its best performers. Some investors had also said Unilever was too slow to revive margins in the wake of the Covid-19 pandemic and needed to become leaner. Unilever said earlier this year it would axe 7,500 jobs globally as part of a restructuring to save about €800 million. ■ REPORT ON PAGE 7 Byju's US arms face `250-crore GST notice PRIYANSH VERMA New Delhi, November 14 THE DIRECTORATE GENERAL of GST Intelligence (DGGI) is likely to approach the National Company Law Tribunal (NCLT) soon, seeking to recover `230-250 crore as taxes from the US subsidiaries of embattled edtech major Byju's. The tax liability has been computed on certain supplies of the USbased subsidiaries to Indian receivers. Official sources said Byju's had kept these transactions “off its books”,andthusdidn’tpayanytaxes on them to GST authorities. “The DGGI has learnt this recently, and approached the edtech company to paytheir dues,”an official said. FE reached out to Byju's for co ments,butcouldn'tgetanyresponse. Byju's parent company ‘Think andLearn’isundergoinginsolvency proceedings in the NCLT. “We informed the insolvency professional about the taxes Byju's owes, but our request was rejected, as we got late in filing the claim,” an official said.“But we are going to exercise all legal options to recover the tax dues,” the official said, adding that the DGGI mayconsiderfiling a plea in the NCLT. Sources said that onlythose serviceswhich are provided byUS subsidiaries in India fall under the ambit of GST. The services that are purely international, made by the offshore arms,don’t owe any tax to domestic authorities. Under GST laws, for the services that are directly provided by the US arms to consumers in India, GST will have to be deposited by the overseas arms,whereas on services provided to third-party businesses or the Indian company, the tax will be paid by the recipients under the reverse charge mechanism (RCM). Continued on Page 5 DATA PROTECTION LAW TO TAKE OVER A YEAR TO BE IMPLEMENTED Tired of promotional calls? The wait for relief just got longer JATIN GROVER New Delhi, November 15 CONSUMERS FED UP with the promotional calls of banks, insurance firms,telcos and others, and wary of their personal data getting into the hands of telemarketers will have to wait longer for some relief. The Digital Personal Data Protection (DPDP) Bill,which became a law in August last year, is unlikely to come into force for at least another 18-24 months. The delay in the implementation, so far, was because the rules under the Act had not been framed.However,officials now say that even when the rules are framed and notified, it may take another 18-24 months to implement the same. This is because companies need to be given adequate transition time. While some big-tech companies may have processes ready, most government-owned companies are quite unprepared, they said. The government and its departments are the biggest data fiduciaries and therefore,for them a shorter time to comply with the Act will be difficult, officials pointed out. Even smaller private firms would need adequate time to sync their processes with the new provisions. Sources said that some Central government ministries have also indicated their unpreparedness in A LONGER TIMELINE ■ For every instance of data breach, entity in charge will have to pay ■ Govt and its departments are the biggest data fiduciaries, will need some time to comply with the new regulations `250-crore penalty if found guilty ■ Smaller private firms also need adequate time to sync their processes formalising a system of seeking consumer consent, and have expressed the need for a longer time frame for transitioning to a new system. ■ The Digital Personal Data Protection Bill became a law in August last year “We will have to provide a reasonable time period for companies to implement the provisions once the rules are notified. The global practice has been 12-30 months. So, we may provide around 18-24 months to all data fiduciaries,” an official said. A key reason why most segments are seeking adequate tran- sition time is because under the Act, for every instance of data breach,the entity in-charge of the data, will have to pay a penalty of `250 crore if found guilty. Once the law comes into force, the first step for companies dealing with consumer data will be to inform their users about the data these firms have related to them. Based on that, users can intimate all digital platforms to delete their past data or give consent to the companies to use the data based on their preferences. While sharing data with any entity, consumers will have the right to ask its purpose, uses it can be put to,and bywhen it would be deleted. For instance, consumers can direct banks, insurance firms, ecommerce firms, etc, with which they share their personal data to not use it for phone calls making sales pitches. Similarly, directions can be given that the data should not be shared with any other entity. The onus of any data breach as a result of theft by employees or in any other manner will lie with the company concerned. Government departments will also have to send notices on the information they have of users. In the rules, the government will also notify the framework for the Data Protection Board, which will act as an adjudicating body for data principals and fiduciaries. HYDERABAD