COMPANIES | PAGE 4 BACK PAGE | PAGE 20 Rajnath to Pak: Hand overAzhar and Saeed ifserious about talks COMPANIES | PAGE 6 IndiGo to add 10 global destinations to network Indian Hotels MD flags high taxes for hospitality sector LUCKNOW, SATURDAY, MAY 31, 2025 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL 18 NO. 152, 52 PAGES, `12 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: 81,451.00 ▼ 182.02 NIFTY: 24,750.70 ▼ 82.90 NIKKEI 225: 37,965.10 ▼ 467.88 HANG SENG: 23,289.77 ▼ 283.61 `/$: 85.58 ▼ 0.05 `/€: 96.94 ▼ 0.48 BRENT: $63.87 ▼ $0.28 GOLD: `95,058 ▲`104 FY25 ECONOMIC GROWTH SLOWSTO 6.5% BUTBEATS ESTIMATES AFTER SARVAM AI, India on Friday selected three more startups—Soket AI, Gan AI, Gnani AI—for building indigenous AI foundation models, reports PTI. In line with its global artificial intelligence ambitions backed by a comprehensive plan that entails enhanced AI infrastructure and local language model development, India has also announced availability of 16,000 more GPUs that would take the compute facility available to startups and researchers here to 34,000, with the support of industry partners. ■ PAGE 6 Asheesh Pandey & Kalyan Kumar named MDs of Union Bank and Central Bank THE FINANCIAL SERVICES Institutions Bureau (FSIB) on Friday recommended Asheesh Pandey (top left) and Kalyan Kumar for the post of managing director of Union Bank of India and Central Bank of India, respectively, reports PTI. Senior banker Pandey is currently the executive director (ED) in Bank of Maharashtra, while Kumar is serving as the ED in Punjab National Bank. ■ PAGE 7 FE S P E C I A L A perfect hatch that has no match Why the new Tata Altroz is better than many tiny SUVs, including the Punch ■ MOTOBAHN, P9 NUMBERS THAT COUNT Key performers in Q4FY25 GVA in Q4, % chg, y-o-y Pub Public admin Financ Fin Financial, real estat estate, etc Trade, hotels, etc 6.5 MUKESH JAGOTA New Delhi, May 30 10.8 Con Construction 9.2 7.6 Real GDP % chg, y-o-y 9.8 7.4% on strength of exports,construction and investments 8.7 7.8 5.4 Electr Electricity, gas etc 5.4 Quarterly numbers, At constant prices; % chg, y-o-y Qu terl mb st t ic FY25* 9.5 FY24 INDIA'S ECONOMIC GROWTH fell to 7.4% in the fourth quarter of 2024-25, from 8.4% in the yearago quarter,as manufacturing,private and government consumption, and key services slowed, according to provisional estimates released by the National Statistics Office (NSO) on Friday. For the whole of FY25, the GDP expansion slowed to a four-year low of 6.5%,comparedwith 9.2% in the previousyear. ThelatestquarterlyGDPwasstill betterthananalystestimates,which hovered around 6.8-6.9%, and came almost in line with the NSO’s secondadvanceestimatespublished on February 28.An upward revision of Q3FY25 GDP growth from 6.2% to 6.4% helped the annual economic expansion to be the same as in second advance estimates. A solid pick-up in construction,a steady primary sector and a rare and big push from “net exports”,which accounted for 3.7% of GDP, helped the Q4 growth rate beatestimates. TheQ4GDPalsogotaboostfrom net indirect taxes — the gross value added(GVA),abetterindicatorofeconomic momentum, grew at a lower rate of 6.8% in the quarter. During FY25, private consumption raised its share in the GDPmarginallyto56.5%from56.1%inprevious year. But the growth of this largest component of the economy fellbothannuallyandonasequential basis in the fourth quarter.High-fre- 8 8.4 7.3 6.5 6.5 Source: MoSPI Q3FY24 Q4FY24 Q1FY25 CEAsticks to FY26 growth projection of 6.3-6.8% TAKING HEART FROM the 6.5% gross domestic product (GDP) growthinFY25despiteglobalheadwinds, chief economic adviser (CEA)AnanthaNageswaranon Friday said the government has retained its forecast of 6.3-6.8% growth in the current financial year, reports feBureau. Private consumption, especially the rural rebound, and resilient services exports are seen quency indicators in the current quarter reflect only a further downslide thereafter. Gross fixed capital formation, a CAPITAL BOOST THE GOVERNMENT HAS agreed to exempt Saudi Arabia’s sovereign wealth fund from a set of foreign portfolio investment rules to attract capital flows and strengthen financialtiesbetweenthetwonations,two sources said. The rules, which club investments through various sovereign entities together and cap it at 10% in a single company, have prevented different subsidiaries of the PublicInvestmentFundfrominvesting more inIndia,theysaid. Prime Minister Narendra Modi visitedtheGulfnationinApril,when boththecountriesagreedtopromote investmentinareasincludingenergy, infrastructureandpharmaceuticals. India is also negotiating a bilateral investmenttreatywithSaudiArabia. The requirement to club investment from different sovereign entities together limits the ability of the Saudi fund and its subsidiaries to investindependently,thefirstsource said, declining to be identified.The 6.4 6.5 GVA 7.4 6.8 *(Provisional estimates) tobekeydriversinthecurrentyear. Multiple agencies have projected India’s growth to be in the range of 6.3-6.7% in FY26. He said high-frequency indicators for April 2025 show strong industrial and commercial activity. Food inflationremainsbenigndue to good rabi harvest, higher summer sowing, healthy procurement, and abovenormal monsoon, he added. ■ PAGE 2 proxyof investment demand,grewa robust9.4%inQ4,whileinthewhole ofthelastfiscal,itexpandedby7.1%. The primary sector comprising Govt to exempt Saudi fund from 10% investment cap SHUBHAM BATRA New Delhi, May 30 5.6 5.8 GDP ■ Public Investment Fund is one of the largest sovereign wealth funds globally with around $925-bn assets under management ■ Its current exposure in India is limited to $1.5 bn ■ The exemption granted to the fund will allow its various arms to invest separately in Jio Platforms and $1.3 bn in Reliance Retail ■ Current rules club investments through various sovereign entities together and cap it at 10% in a single company exemption granted to the fund will allowitsvarious arms to invest separately, enhancing their flexibility in deploying capital into the Indian equity markets without breaching regulatorythresholds,he said. The finance ministry and the Saudi fund did not respond to requests forcomment. The Public Investment Fund is one of the largest sovereign wealth funds globally with assets of about $925 billion undermanagement.Its current exposure in India remains limitedto$1.5billioninJioPlatforms and $1.3 billion in Reliance Retail, according to itswebsite. India,theworld's third-largest oil importer, is looking to draw longterm capital from energy-rich Gulf nations,whileSaudiArabiaisseeking to expand its investments in fastgrowing economies as part of its Vision 2030diversification strategy. Q2FY25 Q3FY25 Q4FY25 Fiscaldeficitat targeted4.8% THE CENTRE’S FISCAL deficit came in at 4.77% of GDP for 2024-25, marginally lower than the 4.84% projected in the revised estimate (RE) fortheyear, despite a shortfall in revenues, especially tax receipts, reports Prasanta Sahu.The fiscal deficit stood at `15.77 lakh crore, 100.5% of FY25RE.Yet the fiscal deficit/GDP ratio was contained as the nominal GDP size came in about 2% higher than the first advance estimate. ■ PAGE 2 agriculture and mining did well (4.4%)in FY25 byits standards. Continued on Page 7 Trump slams China for ‘totally violating’ trade pactwith US DAVID LAWDER & KATHARINE JACKSON Washington, May 30 US PRESIDENTDONALD Trumpon Friday said China had violated an agreementwith the US to mutually roll back tariffs and trade restrictions for critical minerals and issued a new veiled threat to get tougher with Beijing.“China, perhaps not surprisingly to some,HAS TOTALLY VIOLATED ITS AGREEMENTWITH US.So much for being Mr. NICE GUY!,” Trump said in a post on his Truth Social platform. Trump said he made a“fastdeal”inmid-May with Chinese officials for both countries to back away from tripledigittariffsfor90days. Contd on Page 6 ■ Trump tariffs in effect for now, Page 10 Continued on Page 10 Investor confidence in startup wanes as rivals pull ahead and execution risks mount Ola Electric: Once a disruptor,nowin distress OLA ELECTRIC, ONCE the poster child forthe country’s electricvehicle (EV) revolution, finds itself at a crossroads.With operating revenue down bymore than 60% in the January-March quarter, net losses surging past `870 crore,and a new `1,700-crore debt raise, the company’s financial health has entered a worrying phase.To make matters worse, auditors have flagged grave concerns over the company’s cash flow,calling into question its ability to continue as a going concern. Auditor BSR & Co LLP issued an unqualified opinion on Ola’s FY25 financials,but raised a red flag over its future viability, citing a massive `2,391-crore negative operating cash flow, up sharply from `633 crore a year earlier, combined with persistent losses and underwhelm- SHOCK WAVES ■ Ola Electric's losses doubled to `870 cr in March quarter ■ The Bhavish Aggarwal-led firm's revenue plunged over 60% to `601 cr ■ Deliveries fell to 51,375 units in Q4 from over 115,000 a year ago ing sales. These conditions, the auditor noted, necessitate urgent mitigating actions to support operations and meet obligations. While Ola Electric had raised `5,275 crore through its high-profile IPO less than a year ago,around `2,823 crore remains unutilised, ■ BSR & Co LLP has raised a red flag over Ola's future viability Ola Electric Intra-day on BSE (`), May 30 ■ Auditor cited `2,391-cr negative operating cash flow, persistent losses and poor sales with `2,775 crore parked in fixed deposits. This has raised questions about the company’s cash burn rate and liquidity planning amid escalating losses. Despite the troubling outlook, Ola’s management insists the company will continue as a going con- « NARAYANAN V Chennai, May 30 50.97 4.26 % Previous close: 53.24 48.36 cern. Their confidence stems from expectations of improved cash flows from new product launches, better operational efficiency, and expanding gross margins.Theyalso point to internal cash reserves, access to credit lines, and reduced delivery times through a revamped retail model under Project Vistaar. However, public markets and analysts remain unconvinced. Shares of Ola Electric closed 4.49% lower at `50.85 on the NSE on Friday, down 68% from their all-time high of `157.40 in August 2024. Kotak Institutional Equities downgradedthestockto“sell,”slashingits target price to `30. The brokerage cited execution delays, especially in the electric motorcycle segment, and weakerthan-expected demand as major concerns. Kotak also cut Ola’s FY26-27 volume estimates by 32-34%, warning that the company must scale up quickly to avoid a cash crunch. In the January-March quarter, Ola reported a 41% quarter-onquarterand 62%year-on-yeardrop in revenue to `611 crore. Continued on Page 6 Govt asks RBI to spare small gold loan borrowers ● 70% of loans are below `2 lakh; norms may take effect in January 6 Agriculture Agricu FY23 India AI mission: 3 more startups to build indigenous foundation models ● Q4 expansion at FY22 IN THE NEWS GDPgrowth at 4-yr low FY21 A RED initiative appears in today’s edition of Financial Express.This magazine is an initiative of the marketing solutions team of The Indian Express Group and contains content paid for by advertisers.The magazine should be read as an advertisement -5.8 EDU-BIZ MAHESH NAYAK & PRASANTA SAHU Mumbai, May 30 THE FINANCE MINISTRY has recommended that the Reserve Bank of India (RBI) exempt loans up to `2 lakh from its proposed gold loan guidelines, a move expected to provide much-needed relief to small borrowers. A post by the ministry on X on Friday said that the department of financial services (DFS), under the guidance of finance minister Nirmala Sitharaman, has examined the draft directions and provided the suggestions to the RBI to ensure that the requirements of small gold loan borrowers are not adversely affected. The DFS also emphasised the need for sufficient time to implement the guidelines at the field level, recommending January 1, 2026, as the implementation date. The development came as a surprise to banks and non-banking financial companies (NBFCs), which submitted their feedback on the draft guidelines on May 12. Industry insiders suggest that political intervention, prompted by the industry’s dissatisfaction with the proposed norms, has contributed to the delay in implementing the new guidelines. After the development, shares of Muthoot Finance climbed over 7%, while Manappuram Finance and IIFL Finance closed 2-3% higher on the BSE. A senior official from a leading gold loan non-banking financial company (NBFC) welcomed the exemption, noting that 70% of borrowers have loans below `2 SHINING BRIGHT Muthoot Finance May 29 (close) May 30 (close) 2,216.35 2,065.85 7.29% Manappuram Finance May 30 (close) May 29 (close) 238.65 2.96% 231.80 ■ The finance ministry’s suggestions come after it examined RBI’s draft directions ■ Industry welcomed the move, says key concerns were about small-ticket borrowers lakh and that 70-75% of the gold loan market remains unorganised. “For this segment, borrowing against gold is often a last resort,” Amlan Singh, head of operations and customer services, at IIFL Finance, said. He added that the main concerns are small-ticket borrowers who are slowly entering into the formal banking system by taking a gold loan from regulated entities and would have been pushed towards unregulated entities offering loans at much higher interest rates. Continued on Page 7 Adani-run Mumbai airport’snewfeerules irkIndiGo,AirIndia ADITYA KALRA New Delhi, May 30 FIGHT ZONE ■ Mumbai airport is seeking a compulsory cash deposit in a bank as security against charges such as landing and parking fees ■ Earlier, THE MUMBAI AIRPORT, run by Adani Group, has triggered a lobbying effort by top carriers IndiGo and Air India after it changed payment rules,citingfinancialneedsandarisk of airline defaults,documentsshow. Theairportisoneofthecountry’s busiest at a time when dozens are being added in one of the world’s fastest-growing aviation markets.It is the biggest of »INSIDE« seven managed by a group led by ADANI NOT Adani Group KEEN TO BUY EMAAR chairman GauINDIA tamAdani. Confidential PAGE 4 letters seen by Reuters show the intense pushback tothechange,whichseeksacompulsorycashdepositinabankassecurity against charges such as landing and parkingfees,insteadofalong-standing practice of bank guarantees. “None of these airlines normally pay on time...we want to align our cashflowwiththeairlines’cashflow,” said Arun Bansal, chief executive of Adani Airport Holdings,which has a Continued on Page 10 Relief for L&Tin Mumbai infra projects case Tata,M&Mseek toblockhybrids ingovtfleets THE MUMBAI METROPOLITAN RegionDevelopmentAuthorityonFriday informed the Supreme Court of its decision to scrap the tender processfortwo marqueeinfrastructure projectsinMumbai,reportsPTI. The SC was hearing a plea of Larsen & Toubro (L&T) against the MMRDA decisiontodisqualifytheinfragiant from bidding. ■ PAGE 4 TOP CARMAKERS, INCLUDING Mahindra & Mahindra and Tata Motors are seeking to block a pollution management body’s attemptstopromotehybridvehicles in government fleets in and around NewDelhi,saying that itwill disrupt adoption of cleaner battery electric carsandhitinvestments,documents show,reports Reuters. ■ PAGE 6 airlines were required to provide bank guarantees ■ IATA, representing both Air India and IndiGo, wrote to the civil aviation ministry stake of 74% in the airport. “They have taken advantage of our niceness,” he added, referring to resistance to the new payment system from IndiGo and Air India since the changeeightmonthsagoinOctober. Lucknow