COMPANIES, P4 COMPANIES, P4 BACK PAGE, P24 Q-commerce to drive demand for gig workers Legacy ICE companies unfazed by Ola’s e-bike Russia hits Ukraine power grid with over 100 missiles MUMBAI, TUESDAY, AUGUST 27, 2024 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL LXIV NO. 204, 30 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 *Prv close SENSEX: 81,698.13 ▲ 611.92 NIFTY: 25,010.60 ▲ 187.45 NIKKEI 225: 38,110.22 ▼ 254.05 HANG SENG: 17,798.73 ▲ 186.63 `/$: 83.90 < > 0.00 `/€: 93.75 ▲ 0.47 BRENT: $81.40 ▲ $2.38 GOLD: `71,096* ▼ `283 — GDP GROWTH LIKELY SLOWED TO 6.7% IN Q1: POLL INDIA’S ECONOMY LIKELY grew at a fivequarter low of 6.7% in Q1FY25, mainly due to slower manufacturing and agricultural activity, coupled with a decline in government expenditure, a median of FE poll of 17 economists showed, reports Priyansh Verma. ■ PAGE 2 STAPLES’ PRICES UNLIKELY TO RISE IN FESTIVALS: GOVT THE GOVERNMENTON Monday allayed fears about any potential spurt in prices of pulses, onion and potato in the coming festive period, citing adequate monsoon rains, robust kharif sowing and liberal import of lentils, reports Sandip Das. ■ PAGE 2 ULTRATECH RAISES $500 MILLION FROM SIX BANKS ADITYA BIRLA GROUP promoted UltraTech Cement has raised $500 million through a sustainability-linked loan with participation from six banks, the company said in a filing to the BSE on Monday. ■ PAGE 5 VEDANTA READIES `30,000-CRORE WAR CHEST VEDANTA HAS PREPARED a war chest of `30,000 crore with funds raised through a QIP, OFS & dividend to pursue further growth, reports PTI. ■ PAGE 4 FE S P E C I A L S CIL faces volume growth risks Diversification into non-coal sectors is vital for sustainability ■ INVESTOR, P9 Why Sebi wants to ease rights issue Sebi has introduced a series of proposals to make rights issues more attractive. What is their potential impact? ■ EXPLAINER, P9 Sebi showcause to Paytm founder for IPO breaches Fintech firm says relevant UNDERTHE LENSAGAIN Aug 23 (close) Paytm disclosures already 554.50 4.41% made, notice not new ■ The noticeswere forVijay FE BUREAU Mumbai, August 26 THE SECURITIES AND Exchange Board of India (Sebi) has issued showcause notices to Vijay Shekhar Sharma, founder of Paytm’s parent company One 97 Communications, and board members for alleged misrepresentation of facts during its initial public offering (IPO) in November 2021, said media reports on Monday. The notices pertain to Sharma’s alleged non-compliance with promoter classification norms.The markets regulator has said that the company should have declared this due to his management control over the company. This classification would have made Sharma ineligible for employee stock options (ESOPs), following the company’s public offer. Sebi regulations prohibit promoters from receiving ESOPs post-IPO. The probe was initiated based on inputs from the Reserve Bank of India (RBI),which had examined Paytm Payments Bank earlier this year. In response to the report, One97 Communications (Paytm),through an exchange filing, said that the showcause notice was not a new development and that the company has made relevant disclosures in the financial results of previous quarters. However,panic among investors about a fresh notice sent the company's shares plummeting as much as 9% during the day. The shares closed at `530, down 4.48%. The main contention of the market regulator was whether Sharma should have been classified as a promoter, given that he had management control rather than an employee while filing the IPO documents. Consequently, Sebi also issued showcause notices to the company’s directors at that time, questioning them for endorsing Sharma’s stance, the people said. In its response, the company said that it “is in regular communication with Sebi and Shekhar Sharma’s alleged non-compliancewith promoter classification Aug 26 (close) 530.05 ■ This classificationwould have made Sharma ineligible for ESOPs, following the public offer ■ Showcause notices to the company’s directors were also issued, questioning them for endorsing Sharma’s stance Satcom firms want gateways to service global operations CASTINGTHE Same transponder can NETWIDE be utilised for many,say ■ OneWeb OneWeb,Starlink,Amazon India, Starlink JATIN GROVER New Delhi, August 26 SATELLITE COMMUNICATION SERVICE providers such as OneWeb India,SpaceXowned Starlink and Amazon's Kuiper Systems have urged the government to allow them to use their gateways in India to service other nations also. The three firms have already applied for licences and regulatory approval to provide satellite internet services in the country. Their request means that the operational infrastructure they put up in India, once their proposal is approved, should also be allowed to service their global operations. It remains to be seen whether the government accepts their demand or not because in this case data of Indian users will be sent out of the country.Usually in and Kuiper want the government to include the permission as part of the new authorisation regime for the telecommunica tions sector ■ The firms highlighted higher cost of setting ground stations in each country, improving network resilience as reasons ■ The probe was based on inputs by RBI, which had examined Paytm Payments Bank earlier this year Work demanded by individuals under MGNREGA contracted for the ninth month in a row in July, reports Saikat Neogi. The year-on-year decline in demand for the scheme has been sharper in recent months. Work demand under MGNREGA Apr Continued on Page 7 325.5 May 425.3 Persons (million, LHS) 50 making necessary representations regarding this matter. Accordingly, there is no impact on the financial results for previous quarters ended June 30, 2024, and March 31, 2024, respectively.” “The company during the year ended March 31, 2022, granted 21 million Employee Stock Options to the managing director and CEO of the company which is subject to achievement of specified milestones. During the current quarter, the company has received a showcause notice (“SCN”) from Sebi related to the above options regarding compliance with Sebi SBEB Regulations,”the company had said in its March quarter results. The company has submitted its preliminary response and is in the process of seeking further information from Sebi, Paytm had said. 2.22 40 19.4 25 15 30 0 5 -5 20 10 (million, 2024) % chg, y-o-y (RHS) 17.5 -21.6 -15 Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul 2023 2024 Jun 324.7 Jul framing the contours for the telecom authorisation regime currently argued that sharing gateways and other infrastructure would save cost, otherwise they will have to put up similar setups in each country they have operations in. Further, network resilience would be better in case of faults and services would become more affordable due to reduced costs. Person days generated 203.6 -25 Source: Ministry of Rural Development Nifty reclaims 25K, record in sight NIFTY RECLAIMED 25,000-POINTS mark on Monday as it rose for the eighth consecutive session - its longest winning streak in over a year – buoyed by the prospects of the US Federal Reserve beginning interest rate cuts from September, reports Vivek Kumar M. This was the eighth consecutive session of gains for the 50-stock index. ■ PAGE 6 FSSAI rolls back order on milk products THE FOOD SAFETY and Standards Authority of India on Monday withdrew last week’s directives to dairy companies against usage of A1 and A2 labels in products such milk and ghee, reports Sandip Das. This comes after experts raised reservations about the move which would impact development of indigenous breeds. ■ PAGE 2 RBI to launch ULI to transform lending UPS has option sans guarantee for risk-takers SACHIN KUMAR Mumbai, August 26 THE RESERVE BANK of India (RBI) is planning tolaunchUnifiedLendingInterface(ULI)nationwide aimed at transforming the lending space in the country. The new platform will enable borrowers to get seamless deliveryof credit,quicker turnaround time without INSIDE requiring extensive documentation. WILLWIDEN “Just like UPI transREACH: formed the payments LENDERS ecosystem, we expect that ■ PAGE 6 ULI will play a similar role in transforming the lending space in India.The ‘new trinity’ of JAM-UPIULIwillbearevolutionarystepforward inIndia’s digital infrastructure journey,”said RBI governor Shaktikanta Das,addressing the‘Global ConferenceonDigitalPublicInfrastructureandEmerging Technologies’in Bengaluru. “By digitising access to customer’s financial and non-financial data that otherwise resided in disparate silos, ULI is expected to cater to large unmet demand for credit across various sectors, particularly for agricultural and MSME borrowers,”he added. The pilot of this the technology platform, which enables frictionless credit, was launched last year by the RBI. SHAKTIKANTA DAS, GOVERNOR, RBI THE ‘NEW TRINITY’ OF JAM-UPI-ULI WILL BE A REVOLUTIONARY STEP FORWARD IN INDIA’S DIGITAL INFRASTRUCTURE JOURNEY “This platform facilitates seamless and consent based flow of digital information, including even land records of various states, from multiple data service providers to lenders,”said the governor. Talking about the Central Bank Digital Currency(CBDC),thegovernorsaidthatthereshould not be in any rush to roll out system-wide CBDC before one acquires a comprehensive understanding of its impact on users,on monetary policy, on the financial system and on the economy. “Such understanding would emerge from generation of user data in pilots. Actual introduction of CBDC can be phased in gradually. Undoubtedly, CBDC has the potential to underpin the payment systems of future, both fordomestic payments and also cross-border payments,”he added. Continued on Page 7 Reliance may ride two OTT platforms post merger RELIANCEINDUSTRIES(RIL),which will control the Star-Viacom18 mergedentity,isexploringtheideaof having two over-the-top (OTT) platforms in its portfolio,targeting separateverticals,sourcesintheknowsaid. The move is aimed at leveraging the digital boom in media and entertainment, even as Disney and Relianceareworkingonpossibleconcessions to be given to secure the approval of the Competition CommissionofIndia(CCI)forthe$8.5billionmerger.Reliancehasalreadyindicated that it is ready to drop a few channelsandfreezeadratestoensure concernsraisedbytheCCIwithregard tomonopoly,industrysourcessaid. On the digital side,Disney+ Hotstar,withover500milliondownloads ■ Trai is Sharp fall in NREGA demand DISNEY+HOTSTAR AND JIOCINEMA TO ADDRESS SEPARATE VERTICALS VIVEAT SUSAN PINTO Mumbai, August 26 ■ Officials in the know said the application by the satcom firms is awaiting clearance from the interministerial group such cases, for security reasons, the government insists that consumer data should be stored within the country itself. If the government accepts their demand, the licence for global mobile personal communication by satellite (GMPCS) will need to be amended, sources said. The satellite internet firms have 22.8 NEWS NOTICES SENTTO DIRECTORS ALSO 44.2 IN THE ■ Disney+ Hotstar has over 500 million downloads and monthly active users in excess of LEVERAGING OTT BRANDS 300 225 million million ■ JioCinema may be the destination for mass content like Hindi movies, Hindi shows and IPL ■ Hotstar is likely to be positioned as a premium OTT platform, mainly for English content and monthlyactive users in excess of 300million,accordingtoGooglePlay Store and SensorTower data respectively,maybepushedasanentertainment destination. JioCinema, with downloads of over 100 million and JioCinema has downloads of over 100 million and monthly active users of ■ monthly active users of 225 million, couldbeasportsplatform,personsin theknowsaid. Another option could be pushing Hotstar as a premium OTTplatform, mainly for English content, while JioCinema will be the destination for masscontentincludingHindimovies, Hindi shows and the Indian Premier League.A potential rebranding exercise to ensure the two platforms are from one media house could also be considered,sourcesintheknowsaid. When contacted, Disney Star declined comment, while Reliance andViacom18werenotimmediately availableforcomment. Experts say that any potential unificationofthetwoOTTplatforms will be gradual. "I don't think Reliance will be in a hurry INSIDE to bury the FREEZE ON Hotstar ACQUISITIONS brand. It has LIKELY an identity of its own and is ■ PAGE 4 a larger platform than JioCinema.But overtime, Reliance may want to keep one brand," Sajal Gupta, chief executive officer of Gurugram-based media consultancyKiaos Marketing,said. Continued on Page 7 Guaranteed 50% pension only under ‘default’ mode PRASANTA SAHU New Delhi, August 26 EVEN AS ASSURED pension has been brought back under the Unified Pension Scheme (UPS) approved by the Cabinet last week, government employees looking for higherpensionwill have the option to get their pension monies invested in high-risk instruments for better returns, sources said. However, they will have to forego the UPS guarantee of pension at 50% of final serviceyear's monthly pay,with full inflation adjustment. Of course,such risk-prone subscribers can potentially get less than‘50% pension’if their investment returns turn out to be low. Guaranteed pension will only be for those who opt for the ‘default investment option’ prescribed, the sources clarified. So, one may opt for either the guarantee or the risk option in pursuit of higher rewards. Under the old pension scheme (OPS), employees who joined before 2004 get 50% of last drawn pay or the average of last ten months' pay as pension sans any contribution. In the case of OPS, the beneficiaries practically have the pension fixed, with inflation indexation. The default-option UPS subscribers will practically have a similar dispensation. Under the UPS, the pension corpus will be divided into two RISK APPETITE ■ The high-risk option under UPS is being kept considering the traction for it among a section of government employees, especially youngsters ■ Under the UPS, the pension corpus will be divided into two parts: individual pension funds and and a separate pool corpus ■ The government managed pool fund would also be used to pay inflationadjusted dearness relief parts: individual pension funds to which the employee’s and matching government contribution will be credited; and a separate pool corpus created out of additional government contribution (8.5% of basic plus DA of all employees). The employee can exercise an investment choice for the individual pension corpus alone. Besides funding gap in guaranteed pension under default option, thegovernmentmanagedpoolfund would be used to pay inflationadjusted dearness relief, etc, as promised. Continued on Page 7