APRIL 2019, Rs 50

APRIL 2019, Rs 50

EDITORAMIT BRAHMABHATT

ASSISTANT EDITORSHRIVATSA JOSHI

CONTRIBUTING EDITORSHARMILA CHAND

ADVERTISING MANAGERWILLIAM RUMAO

GRAPHIC DESIGNERRENUKA SAWANT

ADVISORY PANELDR D K BHALLAJITENDRA SANGHVISHASHIKANT PATEL

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BUREAU CHIEFS

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DELHI: RANJANA ARORA

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Printed and published byAmit Brahmabhatt for Issues Analysisand Research Pvt Ltd and publishedfrom 102, Rajasthan Technical Centre,Patanwala Estate, Ghatkopar (W),Mumbai 400 086 and printed atNikeda Art Printers Pvt. Ltd.,Unit No. H & I, Kanjur IndustrialEstate, Quarry Road, Bhandup (W),Mumbai - 400 078

Editor: Amit Brahmabhatt

Volume XIV, No 10Issue date April 1-30, 2019Released on April 1, 2019

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CONTENTS

YOUR GATEWAY TO INDIA INC.

www.indiabusinessjournalonline.com

INDIA BUSINESS JOURNAL APRIL 2019 3

Solar Power ..........30Solar Eclipse: A mix of unfriendly

policies, ill-conceivedmeasures andadverseconditions dimsthe prospects of

the sunrise sector.

Personal Finance ..........32Finances For Her: Women can

become evenbetter managersof the future bydrawing up arobust financialplan and living

by it.

Management Mantra .........34Don't Pack A Parachute:Ranjit Nair, CEO, Germin8

Global Wrap-Up ..........36A quick round-up of news andcurrent affairs across the world

Readers' Lounge ..........40Catch up with new book launches- The Age of Surveillance Capitalism- Jobonomics- Dissent on Aadhaar

Star Talk ..........42Forecast by Bejan Daruwalla

Knowledge Zone ..........44- Margrethe Vestager,

European Union'sCompetition Commissioner.

- National Anti-ProfiteeringAuthority

- Spiritual Corner: Adjust Everywhere

Hot Seat ..........46Hard WorkPays:Meena Jain,Director(Procurement),Pride Hotels

Viewpoint ..........4Keeping Jet Afloat

News Round-Up ..........6A brief on news, tie-ups,appointments and awards

Finance ..........12A New Regime: The RBI makes yet

another attemptto ensure that itspolicy rate trans-mits in a timelymanner to banks'lending rates.

Corporate ReportMaking Of An Auto MNC: Big-

ticket domesticand globalacquisitions andstrong presenceacross segmentshave transformed

M&M into a leading, multinational,automobile manufacturer. ..........16

100 Not Out: A rich heritage ofinnovation andentrepreneurshiphas keptKirloskarBrothers, whichrecently entered

the centenary year, brimming withenergy and enthusiasm. ........18

Focus ..........20Jolts From The Blue: Two major air

FIRED UPBarring a few concerns, Indian startups lookset for a grand takeoff, aided by huge fundingand favourable government policies.

COVER STORY

22

crashes involving Boeing 737 Maxjets put the spotlight on theAmerican plane-maker and possible,compromised, US regulatory system.

The inevitable finally happened. Jet Airways founder Chairman Naresh Goyaland his wife Anita Goyal were finally forced by lenders to quit the airline's

board. In short, crisis at the debt-ridden airline was worsening by the day.Mr Goyal's exit improves the chances of Jet's survival. It was always implicit

that Mr Goyal's control over the airline was a major sticking point with manypotential investors. Etihad Airways, which had bought a 24 per cent stake inJet Airways in 2013, was unwilling to infuse more capital into the airline simplybecause of Mr Goyal's control over the airline.

The banks, led by State Bank of India (SBI), have taken over a little morethan half of the equity of Jet, making them the majority owners. The lenderswill be injecting some Rs 1,500 crore to allow the airline to clear its dues toemployees. The much-needed capital infusion will also help the airline pay offits arrears due to aircraft lessors, fuel suppliers, airports and othersundry vendors. More importantly, the lenders have bailed out Jet Airways -which completed its silver jubilee of operation last May - and enabled it tokeep flying.

The lenders have perhaps made the difficult, but possibly more pragmatic,choice of taking majority control of the airline rather than dragging it throughthe Insolvency and Bankruptcy Code (IBC). The bankruptcy proceedings couldhave meant long delays, deep haircuts and low recoveries.

Now, the big challenge for lenders will be to find an investor who will buytheir stake in Jet Airways and make good their loans of over Rs 8,100 crore.The banks expect to complete the bidding process in the coming quarter. Aquick closure is critical since banks are hardly equipped to run airlines, espe-cially in a market as challenging and cut-throat as of India's.

Meanwhile, Jet's bailout by the banks does raise some troubling questions.No one could perhaps disagree with former Kingfisher Airlines chief VijayMallya's sarcastic tweets following Jet Airways' rescue. It will remain a mys-tery as to what prompted the lenders to rescue Jet and, at the same time, leaveKingfisher - which was in a similar situation as Jet's - high and dry.

In fact, both Mr Goyal and Mr Mallya committed the same mistakes. Both ofthem got their airlines to expand aggressively during the boom period. BothJet and Kingfisher acquired loss-making low-cost carriers Sahara Airlines andDeccan Aviation respectively. Those acquisitions proved to be disastrousand have played a major role in bleeding both the airlines.

Legacy issues apart, typical problems of the Indian aviation industry arealso to blame for the debacle of Kingfisher then and Jet now. Many structuralwoes, such as congestion at major airports, high airport costs, high taxes onaviation turbine fuel and the 20-aircraft rule to fly international, have beenbleeding all the Indian airlines. Add to these, high fuel cost and cut-throatcompetition that is driving down air fares, and there can be no doubts why theIndian aviation industry is in a tailspin despite huge growth potential.

There are also regulatory roadblocks that need to be cleared. Indian regula-tions allow 100 per cent foreign investment in domestic carriers. However, theshare of foreign airlines cannot exceed 49 per cent. There is little logic in suchprotectionism in this age of liberalisation.

For now, a quick recovery of Jet Airways is of paramount importance. Butthe Centre should step in to reform the domestic aviation industry. It will haveto remove the regulatory roadblocks and solve the structural problems dog-ging the industry. These long-term solutions can ensure that Indian airlineswill face fewer headwinds.

Keeping Jet Afloat

For now, a quick recoveryof Jet Airways is ofparamount importance. Butthe Centre should step into reform the domesticaviation industry. It willhave to remove theregulatory roadblocks andsolve the structuralproblems dogging theindustry. These long-termsolutions can ensure thatIndian airlines will facefewer headwinds.

VIEWPOINT

The big challenge for lenders willbe to find an investor for JetAirways soon.

4 APRIL 2019 INDIA BUSINESS JOURNAL

India joins elite ASAT club with Mission Shakti India con-ducted its first anti-satellite (ASAT) missile test last month,successfully destroying a low-earth-orbit satellite in space byusing a missile which covered a distance of 300 km to engage thetarget. New Delhi, however, emphasised that the test did notalter its commitment against weaponisation of outer space. PrimeMinister Narendra Modi declared the test, called Mission Shakti,successful in a specially-televised announcement. The test placesIndia in a select group alongside the US, Russia and China, coun-tries with demonstrated ASAT capability.

NEWS ROUND-UP

Odisha to house Jindal'spvt industrial estate TheOdisha government hasapproved a proposal ofJindal Stainless (JSL) forsetting up a private industrialestate near Kalinga Nagar inJajpur district. A high-levelmeeting chaired by ChiefSecretary A P Padhi gave thego-ahead to the proposal lastmonth. Mr Padhi asked theauthorities concerned tocomplete the work in thefirst phase within three yearsfrom the date of landallotment. The industrialestate will be developed intwo phases. It envisages aninvestment of aroundRs 1,532 crore with anemployment potential of19,000 persons.

CAPINDIA 2019 ends ona promising noteCAPINDIA 2019 would helpshowcase India as a reliableand competitive sourcing hubfor chemicals, plastics andbuilding and constructionmaterials, among others. This

portfolio should play asignificant role in thegovernment's ambitioustarget of achieving an exportof $900 billion by 2020,stressed Commerce SecretaryAnup Wadhawan. He wasspeaking after inauguratingCAPINDIA 2019, a three-

day mega expo focused onchemicals, plastics and otherproducts, in Mumbai lastmonth. Co-organised byCHEMEXCIL,PLEXCONCIL, CAPEXCILand SHEFEXIL, the megaevent witnessed businessmeetings and discussions,

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US exhibition, seminars, buyer-

seller meets and participationby over 500 Indian exportersshowcasing a range ofproducts.

US withdraws GSP, 3,500Indian goods hit The USgovernment withdrewGeneralised System ofPreferences (GSP) benefits toIndia worth $70 million on asmany as 50 items effectivefrom last month. Indianofficials noted that thewithdrawal of benefits was apart of the 94 products onwhich the US had revokedGSP benefits for all coun-tries. The GSP was not amajor portion of India's $5.6billion exports through duty-free entry of 1,937 productsto the US under the system,the officials had added.

7 of world's top-10polluted cities in IndiaSeven of the top-10 mostpolluted cities in the worldare in India, according to anew study released by IQAirAirVisual and Greenpeace.Gurugram led all cities inpollution levels in 2018, evenas its score improved fromthe previous year. Threeother Indian cities joinedFaisalabad, Pakistan, in thetop-five polluted cities list.The study throws light onSouth Asia's battle withdeteriorating air quality, andthe economic toll it isexpected to take worldwide.The study measures thepresence of fine particulatematter, known as PM2.5, apollutant that can fester deepin the lungs and bloodstreamof human beings.

Advanced braking mustfor large vehicles Ad-vanced braking systems havebeen made mandatory forvehicles with nine or moreseats to curb accidents andimprove road safety, thegovernment has said. The


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Verbatim...existing vehicles will berequired to adopt the newprovisions with effect fromApril 2021, while all newvehicles rolling out fromApril 2022 will have thesepre-fitted. "The Ministry ofRoad Transport andHighways has decided tomandate advanced brakingsystems, technologies andperformance requirements forimproved road safety andreducing accidents," theministry has said in astatement.

Govt not to seek profitfrom unexplored oilblocks In a major overhaulof oil and gas explorationpermits, the government willnot charge any share of profiton hydrocarbons producedfrom less explored areas. Thedecision is aimed at attractingelusive private and foreigninvestments to raise domesticoutput. Breaking from thetwo-and-a-half decade-oldpractice of having a uniformcontractual regime for allsedimentary basins in thecountry, the new policyprovides for different rulesfor areas that already haveproducing fields and oneswhere commercial productionof oil and gas is yet to beestablished. Irrespective ofthe basins, producers will getcomplete marketing andpricing freedom for oil andgas in future bid rounds.

MSMEs were big jobcreators in past 4 yrs: CIIJob creation by the micro,small and medium enterprises(MSMEs) sector saw growthof 13.9 per cent in the pastfour years, according to anindustry survey by theConfederation of IndianIndustry (CII). The surveyreveals that over 1 lakhMSMEs were able tohire13.9 per cent more orcreate 3,32,394 new jobsover the past four years,

which is a 3.3 per centincrease per annum in thefour years. The findings arecontrary to the official andother industry data, whichshow that there were massivejob losses among MSMEssince demonetisation and GST.

Telecom subscriber basehits 120 crore Thecountry's telecom subscriberbase for the third timecrossed 120-crore mark withReliance Jio, BSNL andAirtel adding new customersin January, according to areport released by telecomregulator TRAI, pertaining todata for January 2019.Earlier, the subscriber basehad crossed the 120-croremark in July 2017 and May2018 and then fallen belowthat mark in the subsequentmonths. Reliance Jiodominated growth byadding over 93 lakh newmobile customers. It wasfollowed by State-run BSNLand Bharti Airtel adding 9.82lakh and 1 lakh new custom-ers respectively inJanuary 2019.

Govt tops FY19 divestmenttarget by Rs 5,000 cr Thegovernment exceeded itsdisinvestment target forFY19 by Rs 5,000 crore,taking the total proceeds toRs 85,000 crore. This is thesecond-highest disinvestmentproceeds in a financial yearafter the government hadmopped up a little over Rs 1lakh crore in 2017-18, helpedby ONGC acquiring thegovernment's entire 51.11 percent stake in oil refinerHPCL for Rs 36,915 crore.Stake sale in REC to PFCand sale of two tranches ofthe CPSE ETFs had fetchedthe government Rs 14,500crore and Rs 27,000 crorerespectively. For the currentfinancial year, the disinvest-ment target has been fixed atRs 90,000 crore.

"Airplanes arebecoming too

complex to fly. Idon't want AlbertEinstein to be my

pilot. I want greatflying professionalswho are allowed toeasily and quickly

take control ofa plane."

Donald TrumpDonald TrumpDonald TrumpDonald TrumpDonald TrumpPRESIDENT, USA

"I have placed liquidassets before thehon'ble KarnatakaHigh Court to pay thePSU banks and allother creditors. Whydo banks not take mymoney? It will helpthem save Jet Airways,if nothing else."

Vijay MallyaVijay MallyaVijay MallyaVijay MallyaVijay MallyaCHAIRMAN, UB GROUP


"There areunmistakable signsof Indian economyslowing down. The

two reasons why thisis happening are a

shortage ofprofessionalism and

a disproportionatefocus on big

businesses and theirinterests."

Kaushik BasuKaushik BasuKaushik BasuKaushik BasuKaushik BasuEX-CHIEF ECONOMIC

ADVISER, INDIA

"I am very happywhere I am. But ifthere is anopportunity to be ofuse, I will alwaysbe there (to returnto India to servethe country)."

Raghuram RajanRaghuram RajanRaghuram RajanRaghuram RajanRaghuram RajanEX-GOVERNOR, RBI

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R NITI Aayog to list CPSEs'non-core assets NITIAayog has been tasked withdrawing up a list of non-coreassets of various Centralpublic sector enterprises(CPSEs), both healthy andsick ones. This is a first stepin the Finance Ministry'splan to monetise such assetsand unlock value to share-holders. This is a part of theoverall plans of the govern-ment to lay down procedureand mechanism formonetisation of non-coreassets of CPSEs, whichinclude mainly land andbuilding. NITI Aayog'sreport will be taken up bythe Alternative Mechanismon Disinvestment toproceed with themonetisation process.

BEL launches SWAGATfare collection systemBharat Electronics (BEL), adefence PSU, recentlypresented SWAGAT, anautomatic fare collectiongating system. PrimeMinister Narendra Modilaunched the system lastmonth as a part of theinaugural of phase-I of theAhmedabad Metro. The farecollection system is the firstindigenous system and thefirst ever outside thedeveloped world. It canoperate across all cities andall modes of transport tomake one nation one card areality. SWAGAT iscompliant with the NationalCommon Mobility Cardecosystem for hassle-freecommute across India. It is inkeeping with the spirit ofMake In India, Digital Indiaand Skill India schemes.

NMDC, GSI ink pact formineral data explorationNMDC has signed amemorandum of agreementwith Geological Survey ofIndia (GSI) for sharing of

71 per cent of its capex targetfor FY19. NHPC faces someheadwinds, as it needs torecover Rs 3,001 crore fromerrant power distributioncompanies.

4 ports to buy 73% inDredging Corporation TheCentral government hasconcluded the strategic saleof Dredging Corporation ofIndia (DCI) to a consortiumof four ports -Vishakapatnam Port Trust,Paradeep Port Trust,Jawaharlal Nehru Port Trust,and Deendayal Port Trust.The sale will help thegovernment meet the Rs80,000-crore disinvestmenttarget set for FY19. A share-purchase agreement wassigned between the Centralgovernment and the fourports last month. Thegovernment had held 73.47per cent equity stake in thecompany. The transactionwas concluded at aroundRs 510 per share, netting thegovernment Rs 1,050 crore.

NTPC ropes in IndianRailway to move fly ashNTPC has teamed up withthe Indian Railway for flyash transportation. Thisagreement will help the State-owned thermal powerproducer enhance ashutilisation at its Rihand andVindhyachal Super ThermalPower plants. NTPC hassigned an MoU withHazipur-based East CentralRailway Zone for transporta-tion of fly ash under IndianRailways' Special FreightTrain Operator (SFTO)scheme. NTPC has becamethe first entity in the countryto sign an SFTO agreementwith Indian Railways. Flyash will be transported byBogey Tank For AluminaPowder rakes, which areleak-proof wagons withspecial air fluidising system.

IOCL's Ennore LNG terminal goes on stream A Rs 5,150-crore liquefied natural gas (LNG) terminal was inaugurated byPrime Minister Narendra Modi at the Kamarajar port, Ennore,last month. The LNG terminal, set up by IOCL, is expected tousher in a green wave in south-eastern India by offering naturalgas as a clean and economically viable fuel, which will also helpin reducing the carbon footprint. Conceived six years ago, this isthe first LNG terminal on the east coast in south India. TamilNadu will be the biggest beneficiary, with the LNG to be sup-plied to customers in Manali region and many units right up toRamanathapuram.

aero-geophysical data(magnetic) for mineralexploration in part ofobvious geological potential(OGP block-2) in MadhyaPradesh. With its expertise inmining, NMDC wasidentified as a nodal agencyby the Ministry of Mines forspecialised mineral explora-tion works. The data thusgenerated through thisassociation will be processedjointly by NMDC and theCentre of ExplorationGeophysics, OsmaniaUniversity, Hyderabad, forobtaining more areas andtargets in the 18 diamondifer-ous blocks allocated toNMDC.

Ordnance Factory torevive anti-aircraft gunsOrdnance Factory Board(OFB) is looking to reviveproduction of anti-aircraftguns at its facility in WestBengal. The revival of anti-aircraft guns will be done atOFB's Cossipore Gun andShell factory. Production of

anti-aircraft guns, whichbegan in the early 1960s, wasdiscontinued due to lack ofdemand. However, it wouldnow be revived as there isdemand from Indian Army aswell as outside, OrdnanceFactory Board ChairmanSaurabh Kumar has said.Mr Kumar added that OFBhad also received order worthRs 1,000 crore for produc-tion of 114 Dhanush artilleryguns from the Indian Army.

NHPC eyes 46% morecapex for FY20 NHPC istargeting a capital expendi-ture (capex) of Rs 3,800crore in the current financialyear (FY20), according toNHPC Chairman, BalrajJoshi. This is 45.46 per centmore than the Rs 2,577 crorecapex target for FY19. Thecompany wants to have aninstalled capacity of 10,000mw by 2022. This targetincludes addition of solarenergy. NHPC's currentinstalled capacity is close to7,000 mw. NHPC has spent


NEWS ROUND-UP

IDBI Bank to handletransactions with IranIDBI Bank has received thegovernment's nod to handleimport and export transac-tions with Iran. This willhelp in promoting India'stwo-way trade with Iranamid US sanctions on thePersian Gulf nation. USPresident Donald Trump hadin May last year withdrawnfrom the 2015 nuclear accordwith Iran, re-imposingeconomic sanctions againstthe Persian Gulf nation.Some sanctions had takeneffect from August 6, 2018while those affecting the oiland banking sectors hadstarted from November 4,2018. IDBI Bank hasbeen identified to routethe payments. UCO Bankhad in the previous roundof sanctions handledIndia's rupee paymentsto Iran.

Unsecured loans grow by31% in Q4 CY18Consumer credit continued tobe the key driver of theIndian economy on the backof strong growth in unse-cured lending categories, suchas credit cards, personalloans and consumer durableloans. Between them, thesecategories grew 31.3 per centyear on year in the lastquarter of calendar year2018, according toTransUnion CIBIL. Securedlending categories - loansagainst property, auto loansand home loans - experiencedmore moderate total balancegrowth by comparison,expanding at the still-robustlevels of 21.8, 17.4 and 17.1per cent respectively duringthe period under review, thecredit information companyhas said.

LIC Housing ties up withIMCG for growth LICHousing Finance has

RBI infuses Rs 34,500 cr via forex auction The RBI's at-tempt to inject rupee liquidity through foreign exchange (forex)swap auction has received good response. Against the notifiedamount of $5 billion for the rupee-dollar swap, banks authorisedto deal in foreign exchange offered $16.31 billion at the auction.Out of $16.31 billion received via 240 offers by market partici-pants, the RBI accepted $5.02 billion via 89 offers. The liquid-ity of Rs 34,561 crore generated due to the swap auction couldsupport credit growth, especially at a time when credit growthis outpacing deposit growth, and soften bond yields.

partnered with IndiaMortgage GuaranteeCorporation (IMGC) to offerhome buyers enhanced loaneligibility and easy loans.With IMGC's back-up, LICHousing will be in a position

banks, while credit tomanufacturing has fallen by0.7 per cent, according toRBI data. Overall banklending has grown by 14.6per cent year-on-year.

Wadhawan to sell 49% inAvanse to WarburgWadhawan Global Capital(WGC) has entered into adefinitive agreement with anaffiliate of the WarburgPincus Group to sell its stakein its education financesubsidiary, Avanse FinancialServices (AFSL). As a partof the deal, WGC will sell itsentire 49.04 per cent stake inthe company. The deal valuehas, however, not beendisclosed. DHFL, a WGCgroup company which holds30.63 per cent stake inAvanse, will also be exitingthe company as a part of thetransaction. AFSL is a new-age, education-focussed,niche NBFC that addressesthe higher education needs ofthe Indian youth.

RBI eases a/c openingnorms for FPIs The RBIhas eased foreign exchangemanagement depositregulations pertaining toopening of accounts byforeign portfolio investors(FPIs) and foreign venturecapital investors (FVCIs),and opening of non-residentordinary (NRO) account bylong-term visa (LTV)holders. The central bank hassaid that banks, which areauthorised to deal in foreignexchange, can allow SEBI-registered FPIs and FVCI toopen and maintain a non-interest-bearing foreigncurrency account for thepurpose of making invest-ments. Further, such bankscan open only one NROaccount for a citizen ofBangladesh or Pakistan,belonging to minoritycommunities in thosecountries.

to offer extended loan tenurefor borrowers till the age of75 years. This will helpincrease the loan quantumand reduce the burden ofmonthly EMIs for borrow-ers. This strategic tie-up willhelp LIC Housing accommo-date more home loanborrowers, increase marketpenetration, besides combatnon-performing assets(NPAs), the housingfinance company has said ina statement.

Banks' credit to NBFCsrises by 48% Non-bankingfinance companies' (NBFC)dependence on bank credithas grown by a massive 48per cent year-on-year tillJanuary. At the end ofJanuary, bank loans toNBFCs stood at Rs 5,57,600crore as against Rs 3,76,000crore a year ago.This growthreflects a shift in focus ofNBFCs from money marketsto banks for funds amidtighter liquidity condition.This is the highest growth inany loan segment reported by


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M R Kumar, LIC's northzone zonal manager, hasbeen named chairman ofthe country's largest lifeinsurance company. LIChas also appointed itsWestern Zone ZonalManager Vipin Anand andSouth-Central Zone ZonalManager T C Susheel itsmanaging directors.

Rakesh Makhija, thechairman of SKF India,has been appointed non-executive, part-timechairman of Axis Bank.He will be taking charge ofhis new responsibilityafter the end of term ofthe bank's currentchairman, Sanjiv Mishra,on July 17.

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Pritika Auto Industrieslines up expansion PritikaAuto Industries is increasingcapacity of rear axle housingsfrom existing 200 sets perday to 320. The autocomponent manufacturer,which has its corporate officein Mumbai, has added thatthe expansion has been takenup as a result of an incremen-tal demand from an existinglarge customer who hasshown immense trust andbelief in it, Pritika has said ina media release. "We are veryexcited about this incrementalorder coming from a veryreputed customer. Theincremental business of 2,400tonnes per annum is anindication of the confidenceour customer has in us,"Pritika Auto MD Harpreet SNibber has said.

Mallya's UB shares salefetches Rs 1,008 croreSale of over 74 lakh sharesowned by abscondingbusinessman Vijay Mallya inUnited Breweries Holdings(UBHL) by Bangalore-basedDebt Recovery Tribunal(DT) last month fetchedRs 1,008 crore, the Enforce-ment Directorate (ED) hassaid. The ED has added thatthe shares attached by theagency as a part of its moneylaundering probe against theliquor baron were lying withYes Bank, and that theKarnataka High Court hadrecently ordered the bank tosurrender these "in favour of"the DRT. Subsequently, therecovery officer of the DRT,Bangalore, published a noticefor the sale of a total of74,04,932 shares of UBHLand realised Rs 1,008 crorefrom sale of the shares.

PNB scam accused NiravModi arrested in LondonNirav Modi, the primeaccused in the PNB bankingfraud case, was arrested by

Scotland Yard in London lastmonth. The diamondmerchant was producedbefore the WestminsterCourt and denied bail on theground that he was a flightrisk, which meant that he hadenough resources and motiveto flee once again. A Londoncourt had reportedly issuedan arrest warrant againstNirav Modi, who is accusedin Rs 13,500-crore fraudcase. The order apparentlycame in response to a requestby the Enforcement Director-ate for his extradition toIndia. He had entered theUnited Kingdom on a 'goldenvisa' issued on his now-revoked Indian passport.

CavinKare launches Rs 3sachet perfume CavinKarehas introduced 2-ml sachetperfumes, the first in thecountry meant for one-timeuse and priced at Rs 3. Atpresent, pocket-friendlybody sprays and perfumesare available in smallcontainers of around 17 ml,costing Rs 50-70. TheRs 1,600-crore company haslaunched the sachet perfume

under its Spinz brand,keeping in mind the hugedemand from rural markets.Over three decades ago, theChennai-based FMCGcompany had revolutionisedthe personal care industry bylaunching 10-ml sachetshampoos under the Chikbrand, targeting the bottom-of-the-pyramid consumers.CavinKare is now trying toemulate its earlier success inthe perfume segment.

RInfra to sell Delhi-Agratoll road to Cube CubeHighways and Infrastructure,the Indian roads andhighways platform of globalinfrastructure fund I SquaredCapital, has agreed to acquireDA Toll Road, whichoperates a toll road inHaryana and Uttar Pradesh,from Reliance Infrastructure(RInfra). The enterprisevalue of the transaction isaround Rs 3,600 crore, andthe proceeds from the salewill be utilised by RInfra fordebt reduction. On comple-tion of the transaction, CubeHighways' portfolio willhave over 4,500 lane-km of

highways across India. DAToll Road operates the 180-km, six-lane, Delhi-Agrahighway (NH2).

Brookfield buys RIL'spipeline for Rs 13,000 crCanadian investor Brookfieldhas acquired loss-makingEast-West Pipeline fromMukesh Ambani's RelianceIndustries (RIL) forRs 13,000 crore. East-WestPipeline, earlier known asReliance Gas TransportationInfrastructure, runs a 1,400-km pipeline which startsfrom Kakinada in AndhraPradesh and ends in Bharuchin Gujarat. The pipeline isused to transport natural gasdiscovered by RIL in the KGbasin block. The company isselling the pipeline infra-structure, as it is operating atjust 5 per cent of itscapacity, consequent toRIL's production from itsKG D6 block sharplydropping over the years.

Vistara gets govt's nod tofly abroad The governmenthas given approval to theTata Group-SingaporeAirlines JV, Vistara, to fly oninternational routes. It is thefirst private airline beingallowed to do so under therecently-amended rules.Vistara has become theseventh Indian carrier to flyoverseas. The governmentchanged the 5/20 rule in2016, which stipulated thatan airline must complete fiveyears in operation and have20 planes in its fleet to fly oninternational routes. Now,the rule has been amended to0/20. Vistara started flyingon January 9, 2015 and hasover 20 planes in its fleet.

With L&T pursuing,Mindtree weighs optionsMindtree board is evaluating"several options" to find a wayout of L&T's hostile bid, ac-cording to Mindtree Executive

NEWS ROUND-UP


Kewal Kiran to open 11 more stores Kewal Kiran Clothing,which owns leading brands such as Killer, Easies, LawmanPg3,Integriti and Desi-Belle, plans to expand its retail footprint to336 stores by opening 11 more retail outlets. Currently, thecompany has 325 retail stores in 210 cities across 25 States.Kewal Kiran Clothing Chairman and Managing DirectorKewalchand Jain has said that the retail expansion has made thecompany's brands popular in tier-III and -IV cities, such asGuntur, Jaypore, Ramgarh and Azamgarh, and is contributingsignificantly to the total revenues of the company.

Chairman KrishnakumarNatarajan. Mumbai-basedL&T has acquired Cafe CoffeeDay owner V G Siddhartha's20.32 per cent stake inMindtree and has also placedan order with brokers to pickup another 15 per cent sharesof the Bengaluru-headquar-tered IT company from theopen market. Besides, an openoffer has been made to buyover 5.13 crore shares oraround 31 per cent stake forRs 5,030 crore. The total dealvalue is estimated to be aroundRs 10,800 crore. Meanwhile,Mindtree has formed a panelto look into "unsolicited openoffer" by L&T.

Dell plans retail spreadacross 1,300 citiesPersonal computer-maker(PC) Dell Technologies isplanning to expand its retailcoverage across 1,300 citiesand towns this year. Dell ispresent in 1,000 cities andtowns in India, and it islooking to increase itspresence in 300 more citiesand towns this year. It has680 Dell exclusive stores.This year, the company isplanning to add another 100stores. Dell is now reachingout to students in tier-III and-IV towns in India where it iscreating awareness aroundgaming PC and career optionslinked to it.

Sterling's Hitesh Patelarrested in Albania HiteshNarendrabhai Patel, who iswanted by Indian authoritiesin the Rs 8,100-crore SterlingBiotech fraud case, has beenarrested in Tirana, Albania.He was detained last monthafter the Interpol issued aRed Corner Notice againsthim on the request of theEnforcement Directorate.The Indian agencies are nowtrying to extradite Mr Patel,a US citizen, and are in touchwith the Interpol and


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Albanian authorities to thisend. Mr Patel is an accusedin the case and is the brother-in-law of the main accused inthe case, the Sandesarabrothers - Nitin and ChetanSandesara.

GVK buys 10% more inMIAL for Rs 924 cr GVKAirport Holdings hasacquired an additional 10 percent in Mumbai InternationalAirport (MIAL) for Rs 924crore. The shares have beenacquired from Airports CoSouth Africa (ACSA) Global.GVK had recently acquired13.5 per cent stake in MIAL

from another South Africancompany, Bid ServicesDivision (Mauritius). Thesedeals take GVK's share inMumbai airport to 74 percent from 50.5 per cent.GVK is increasing its stake inMumbai airport to thwartthe Adani Group's attemptto gain a shareholding in thecompany.

ABG Shipyard headed forliquidation ABG Shipyard,once India's biggest privateshipbuilder, is headed forliquidation after a lenders'panel rejected the resolutionplan submitted by London-based Liberty House for thedebt-laden shipbuilder.Sundaresh Bhat, theresolution professional forABG Shipyard, has filed anapplication with theAhmedabad bench of theNational Company LawTribunal (NCLT), seekingliquidation of the Gujarat-based shipbuilder underSection 33 (2) of theInsolvency and Bankruptcy

Premji commits more to philanthropy Wipro Chairman AzimPremji has committed to philanthropy an additional 34 per centstake in Wipro belonging to him and valued at Rs 52,750 crore.The new commitment is in addition to the 33 per cent thatMr Premji had already earmarked for the Azim Premji Founda-tion, taking the total market value of the philanthropic endow-ment corpus to Rs 1,45,000 crore. Mr Premji's total stake inWipro earlier stood at 74.3 per cent. With the additionalcommitment, the Foundation now has economic ownership of67 per cent of Wipro.

Amit Kakkar, a formerCOO of Toyota FinancialServices and top executiveof Clix Capital Services,has joined CNH IndustrialCapital India, the financialservices division of CNHIndustrial, as its managingdirector.

APPOINTMENTS

Code (IBC). The Committeeof Creditors, led by ICICIBank, has approved aresolution, backing theliquidation plan. The yardowes some Rs 18,245 croreto a clutch of banks, led byICICI Bank.

Airtel unveils Rs 32,000-cr mop-up plan BhartiAirtel's promoters andSingapore's sovereign wealthfund GIC will together investRs 16,785 crore as a part of arights issue approved bytelecom operator's board lastmonth. This developmentcomes a week after BhartiAirtel's board had approvedthe rights issue of Rs 25,000crore as well as raisingRs 7,000 crore throughforeign currency perpetualbond issues, taking the totalcapital-raising exercise toRs 32,000 crore. The capitalwill help strengthen Airtel'sbalance sheet and enable it toinvest in networks in ahyper-competitive telecommarket.

Notices slapped on ex-directors of IL&FS armThe new, government-appointed board of IL&FShas charged 14 formerdirectors of group firmIL&FS Financial Services offacilitating money laundering,sanctioning loans in violationof rules and causing "hugefinancial stress and losses" tothe company. Issuing show-cause notices to the 14former directors, it hassought explanation on thefindings of an audit report byGrant Thornton. The noticesfollow an extensive specialaudit ordered by the newboard and conducted byGrant Thornton. The auditreport had found seriouslapses in the manner in whichhuge loans were extended tocertain entities.

A New RegimeThe RBI makes yet another attempt to ensure that itspolicy rate transmits in a timely manner to banks'lending rates.

The RBI has come out with newguidelines for enhancing credit

discipline among large borrowers.Accordingly, borrowers having ag-gregate, fund-based working capi-tal limit of Rs 150 crore and above,will have to utilise 40 per cent oftheir working capital limit as a loancomponent from April 1. Besides,the 40 per cent loan component willbe revised to 60 per cent with effectfrom July 1.

Drawings in excess of the mini-mum loan component thresholdmay be allowed in the form of cashcredit facility, the RBI has added.Additionally, banks will need to setaside capital for the unused portionof a working capital facility. Theguidelines further stipulate that theamount and tenure of the loan com-ponent may be fixed by banks inconsultation with the borrowers,subject to the tenure being not lessthan seven days.

Banks provide working capital fi-nance by way of cash credit, over-

FINANCE

IBJ BUREAU

State Bank of India (SBI) took asignificant step to link depositand lending rates to a bench-

mark rate last month. The country'slargest lender announced that it wouldlink savings bank (SB) deposits overRs 1 lakh and all cash credit (CC) ac-counts and overdrafts (OD) withlimits above Rs 1 lakh to the RepoRate - the interest rate at which thecentral bank provides liquidity tobanks - from May 1.

According to the new system, theinterest rate on SB deposits with bal-ances above Rs 1 lakh will be pricedat 2.75 per cent below the currentRepo Rate of 6.25 per cent, workingout to 3.50 per cent per annum. Simi-larly, the interest rate on all CC ac-counts and ODs above Rs 1 lakh willbe 2.25 per cent above the currentRepo Rate 6.25 per cent, which willeffectively be 8.50 per cent per annum.

SBI has decided to exempt SB ac-count-holders with balances up toRs 1 lakh and borrowers with CC or

OD limits up to Rs 1 lakh from the link-age to the Repo Rate. "About 98 percent of the bank's savings account-holders will not come under this RepoRate-linked interest rate, as the bal-ance in these accounts is less thanRs 1 lakh. However, in terms of value,about 80 per cent of the savings ac-count deposits will be covered," revealsSBI Managing Director P K Gupta.

SBI's new interest rate regimecomes in the backdrop of the ReserveBank of India directing banks to linkall new floating rate personal or retailloans (housing, auto loans, etc) andfloating rate loans to micro, small andmedium enterprises (MSMEs) to oneof the four external benchmarks -policy Repo Rate or 91-day Treasurybill or 182-day treasury bill or a bench-mark market rate produced byFinancial Benchmarks India (FBIL) -from April 1.

FBIL is jointly owned by Fixed In-come Money Markets and DerivativesAssociation of India, Foreign Ex-change Dealers' Association of Indiaand the Indian Banks' Association

(IBA). FBIL aims to develop and ad-minister benchmarks relating tomoney market, government securitiesand foreign exchange in India.

"SBI has taken the lead in linkingits key pricing decision for SB depos-its and short-term loans to the RepoRate of the RBI from May 1 to ad-dress the concern of rigidities in thebalance sheet structure and addressthe issue of quick transmission ofchanges in the RBI's policy rates," thebank has said in a statement.

By linking interest rates on somedeposits and loans to the Repo Rate,SBI hopes that the change from theRepo Rate to its interest rates will beautomatically transmitted. For in-stance, if the RBI cuts its Repo Rateby 25 basis points or bps - one bps isa hundredth of a percentage point -interest rates on SB, CC and OD ac-counts over Rs 1 lakh will also comedown by 25 bps.


Curbs On Large Corporate Loansdraft, working capital demand loan,purchase or discount of bills, bankguarantee, letter of credit and factor-ing. Cash credit, which essentiallyfunctions like an overdraft account,is by far the most popular mode ofworking capital financing. While cashcredit has its benefits, it also posesseveral regulatory challenges, suchas perpetual rollovers, transmissionof liquidity management from borrow-ers to banks or the RBI and hamper-ing of smooth transmission of mon-etary policy.

Until recently, a company whichheld a certain cash credit limit witha bank would withdraw money fromthat account whenever it wantedand repay it whenever it wanted. Arate of interest agreed upon be-tween the lender and the borrowerwould be charged accordingly.

The cash credit facility was use-ful for companies, as it facilitated

them to utilise the facility wheneverthe need arose. However, it would cre-ate some volatility in liquidity man-agement for banks.

With the new norms, banks will bemore judicious in sanctioning work-ing capital limits to companies. Theymay also most likely provide these fa-cilities at a higher cost. According toan analysis by India Ratings, the newguidelines on capping fund-basedbank credit to corporate entities are

expected to increase their refinanc-ing needs to the tune of Rs 4 lakhcrore in the medium term and up toRs 7.83 lakh crore during the newfinancial year.

In its recent report, SBI notes:"There are many benefits of this(fund-based bank credit) move.First, as the borrowers would berequired to manage their workingcapital cycle and manage short-termliquidity, it would lead to better li-

quidity planning by borrowers.Second, it will lead to improvedmanagement of intraday andshort-term liquidity by banks, en-abling the banks to meet regula-tory prescriptions and better as-set-liability management planning.Third, withdrawals by customersunder working capital demandloans facility for specified dura-tions would lead to developmentof term money market in India."

New norms will lead companies to go infor better liquidity planning.


"The latest move by SBI is in a waytelling customers to convert their sav-ings account deposits into term (fixed)deposits to get a fixed rate, if theyhave over Rs 1 lakh in their accounts.It will improve banks' asset-liabilitymanagement because some short-term deposits will get converted intomedium-term deposits," notes CARERatings Chief Economist MadanSabnavis.

Past benchmarksLast December, the RBI had asked alllenders to link all their floating rateloans to an external benchmark tobring transparency in the pricing ofloans as well as ensure that its mon-etary policy rate is transmitted in atimely manner in banks' lending rates.Banks were permitted to have the dis-cretion to decide on the spread at theinception of the loan. But the centralbank had clarified that the spreadshould remain constant over the pe-

riod of the loan, unless there was achange in the borrower's credit score.

The central bank's measure comesin the face of opposition from banksto an external benchmark. In October2017, the RBI had released a report ofan internal study group, led by JanakRaj, a top RBI official, to review theworking of the Marginal Cost Lend-ing Rate (MCLR) system. The MCLRsystem, introduced in April 2016, hasbeen the latest formula to arrive at abenchmark lending rate for banks.

Back then, the IBA had opposedthe move to link lending rates to anexternal benchmark. It had written tothe RBI that the MCLR system wasworking well and that it should con-tinue. Most of the banks, barring someforeign banks, were of the view thatnone of the external benchmarks rec-ommended by the study group couldbe adopted since banks' funding costwas not related directly to any of the

"About 98 per cent of the bank'ssavings account-holders will notcome under this Repo Rate-linked interest rate, as thebalance in these accounts is lessthan Rs 1 lakh. However, interms of value, about 80 per centof the savings account depositswill be covered."

P K GUPTAManaging Director, SBI

SBI has taken the lead and linked some of its deposit and lending rates tothe Repo Rate.

"Theproposal tolink banks'lending rateson new retailand MSMEloans withexternalbenchmarks

is expected to improve thetransparency in loan pricing bybanks and full transmission ofpolicy rate to banks' lendingrates."

KARTHIK SRINIVASANGroup Head, ICRA

FINANCE


proposed external benchmarks.

Starting anewThe new loan pricing mechanism,which will take effect from April 1, willreplace the MCLR system that wasoperational for the past three years.The MCLR itself had replaced theBase Rate, which was in force fromJuly 2010 to March 2016. And before2010, there was the Benchmark PrimeLending Rate (BPLR), which was in-troduced in 2003.

When the MCLR was first intro-duced, it was pitched as a solution tothe perennial problem of banks notseeing an immediate change in theiraverage cost of funds even after achange in policy rates by the centralbank. This meant that loan rates wouldalso be slow to adjust.

Under the base rate mechanismand in the case of its predecessor, theBPLR, banks would consider the av-erage cost of funds rather than themarginal cost while calculating theirlending rate. The average cost offunds took into account the interestrates that banks paid on old as well asnew deposits. So, even if banks wouldreduce the interest rate they paid ontheir new fixed deposits, the intereston the old deposits would ensure thatthere was hardly any reduction in theiraverage cost. Thus it failed to reflectany change in the RBI's policy rate.

Under the marginal cost systemused as a part of the MCLR system,lenders had to consider the cost theypaid on every additional deposit theyreceived from the depositors.Theoretically, this cost wouldadjust more quickly, making transmis-sion of policy rate to interest ratesmore effective.

However, since the MCLR was in-troduced, two problems arose. First,banks continued to price old loansusing the Base Rate, while new loanswere priced using the MCLR. So, natu-rally, the problem of divergence be-tween loan rates and the policy andmarket rates persisted. The RBI hasasked banks to harmonise all old loanslinked to the Base Rate with theMCLR from April 2018. However, theshift to MCLR has been slow.

The practical difficulties involvedin continuing with the MCLRsystem thus prompted the centralbank to have a relook at the loanpricing mechanism. It was thisquest that led to the RBI recommend-ing linking lending rates to one ofthe market-based benchmarksfrom April 1.

"The proposal to link banks' lend-ing rates on new retail and MSMEloans with external benchmarks is ex-pected to improve the transparencyin loan pricing by banks, as the exist-ing benchmarks, especially the BaseRate, have not led to a full transmis-sion of the benefits of decline in costof funds from banks to borrowers,"points out Karthik Srinivasan, thegroup head of ICRA's financial sec-tor ratings.

Meanwhile, SBI has taken the leadand linked some of its deposit andlending rates to the Repo Rate, one ofthe external benchmarks proposed bythe RBI. It is possible that sooner orlater other banks too will follow thepath of SBI. And then perhaps, thenew external benchmarks may lead totimely reflection of policy rate inbanks' lending rates.

"The latestmove bySBI is in away tellingcustomersto converttheir savingsaccountdeposits

into term (fixed) deposits to geta fixed rate, if they have overRs 1 lakh in their accounts. It willimprove banks' asset-liabilitymanagement."

MADAN SABNAVISChief Economist, CARE Ratings

304, Building No. 6, Sector No. 3, Millennium Business Park, Mahape, Navi Mumbai - 400 0710Phone No.: 022 27784430-35 FAX No.: 022 27784436

Email ID: [email protected]

Excel Gas & Equipment Pvt Ltd

An ISO 9001: 2008 Certified Company Website: www.excelgas.com

IBJ BUREAU

Mahindra & Mahindra(M&M) drove past yet an-other milestone last month.

The flagship company of the aroundRs 1,45,000-crore Mahindra Group un-veiled Pininfarina Battista - consid-ered as the world's fastest, luxury, elec-tric car (e-car) - at the Geneva Inter-national Motor Show last month.

Pininfarina Battista, designed byTurin, Italy-based AutomobiliPininfarina, a part of the Mumbai-headquartered Mahindra Group, isclaimed to be faster than a currentFormula-1 race car in its 0-100 km/hsub-two second sprint. With 1,900 hpand 2,300 nm torque on tap, Battistacombines extreme engineering andtechnology in a zero-emissions pack-age, according to the Italiancompany's media release.

Speaking after unveiling the luxurycar in Geneva, Automobili PininfarinaCEO Michael Perschke noted: "TheBattista is the hypercar of the future,inspired by a legendary past. It com-bines true inspiration and innovationin its technical achievement and emo-tional appeal."

Pininfarina Battista would belaunched in the market in 2020 at alittle over 2 million euros (more than

Big-ticket domestic and global acquisitions andstrong presence across segments have transformedM&M into a leading, multinational, automobilemanufacturer.

Rs 15.5 crore). No more than 150Battista cars would be hand-craftedin Italy and allocated equally betweenthe regions of North America, Europeand the Middle East and Asia, theMahindra Group company said.

The luxury e-car has been inspiredby iconic Pininfarina designs, such asthe Cisitalia 202, Ferrari DinoBerlinetta Speciale, Ferrari Modulo,and Sintesi concept cars. The e-carhas been named after Battista 'Pinin'Farina, the founder of the Carrozzeria

Pininfarina coach building companythat he started in 1930.

In 2015, M&M - which manufac-tures tractors and a wide range of au-tomobiles - and its group companyTech Mahindra - the country's fifth-largest information technology (IT)company - had bought 76.06 per centstake in Pininfarina, the globally-re-puted automotive and industrial de-sign company, for over 50 million eu-ros (over Rs 390 crore) after monthsof negotiations. A year later, M&Mhad entered into a brand licenceagreement with Pininfarina for use ofits trademarks.

In 2018, M&M had re-launched theItalian car design company asAutomobili Pininfarina and roped inMr Perschke, the former Audi Indiahead, as its CEO. AutomobiliPininfarina combines Pininfarina'sautomotive design prowess withMahindra's growing electric vehicle(EV) expertise.

Glorious pastFrom Willys jeeps to PininfarinaBattista, it has been an exciting jour-ney for M&M. In fact, the automo-bile-maker has travelled a long wayfrom assembling the Willys jeep tobecoming a leading, multinational,automobile manufacturer.

M&M began operation way backin 1945 as a steel trading company,Mahindra and Mohammad. In 1947,Ghulam Mohammed, one of thefounders of the company, moved toPakistan. It was thereafter thatMahindra & Mohammed becameMahindra & Mahindra, and there wasno looking back.

The Mahindra brothers - KailashChandra Mahindra or KC and JagdishChandra Mahindra or JC - turned theirfocus to automobile in 1947. Theysought a permit from US' Willys-Over-land to assemble Willys jeeps inMumbai. The idea was to build rug-ged, simple vehicles capable of tack-ling Indian roads. Mahindra's jeepshelped in redrawing the country's au-tomotive roadmap.

M&M At A Glance1945Origin

Tractors & AutomobileBusiness

MumbaiHeadquarters

Bolero, Scorpio, Xylo, Tivoli,XUV Furio, Blazo, Jawa,Centuro, Mojo, Duro, Rodeo,Gusto & AlfaTop brands

Rs 49,670 croreFY18 revenue

Rs 4,356 croreFY18 net profit


CORPORATE REPORT

Big-ticket domestic and global acquisitions andstrong presence across segments have transformedM&M into a leading, multinational, automobilemanufacturer.

MakingOf AnAutoMNC

MakingOf AnAutoMNC

From the jeeps, in subsequentyears, M&M began rolling out a widerange of cars and other vehicles. Sincethen, the company has become theworld's largest tractor brand by vol-ume. It is also India's largest utilityvehicle manufacturer. The companyis literally present in every segmentof the automobile sector, be it two-wheelers - a wide range of Jawa,Centuro and Mojo motorcycles andDuro, Rodeo and Gusto scooters -three-wheelers - Alfa autorickshaw aswell as Alfa goods carrier - light com-mercial vehicles - Bolero Pik-Up andImperio - heavy commercial vehicles -Mahindra Furio and Blazo range oftrucks -sports utility vehicles (SUVs)- Bolero, Scorpio, Mahindra Xylo,Tivoli and XUV - and e-vehicles - e2OPlus compact car, eVerito sedan,eSupro van, Treo autorickshaw andeAlfa Mini autorickshaw.

Over the years, the MahindraGroup has diversified into a num-ber of other sectors and today it op-erates in 22 key industries, includ-ing automobile (M&M), IT (TechMahindra), finance (Mahindra &Mahindra Financial Services), autocomponents (Mahindra CIE Auto-motive), e-vehicles (Mahindra Elec-tric Mobility - formerly Reva Elec-tric Car Company), travel and lei-sure (Mahindra Holidays & ResortsIndia) and realty (MahindraLifespace Developers), among oth-ers. And the business conglomerate'ssuccessful diversification has beensteered by Mahindra Group ChairmanAnand Mahindra. With presenceacross over 100 countries, the vastbusiness conglomerate boasts of 55manufacturing facilities worldwideand employs more than 2,40,000people.

Winning strategiesM&M's presence across a wide rangeof automobile segments has enabledthe auto-maker to de-risk its business.This strategy has helped the companygrow steadily even if a few segmentsunderperform. The company can still

continue to grow on the back of bet-ter-performing segments.

Besides, M&M has orchestrated aclear acquisition strategy during thelast decade, which has catapulted thegroup to its present position. Start-ing with acquisition of Kinetic Motorin 2008, which gave M&M access tothe mass market of scooters and mo-torcycles bikes, the automobile com-

vehicles rolling out of Mahindra'splants, bringing higher growth in itsrevenue and profit. The company'sFY18 revenue and net profit grew by14 and 18 per cent to Rs 49,670 croreand Rs 4,356 crore respectively. Dur-ing the same year, Mahindra's plantsrolled out 5,00,000 vehicles acrosssegments, a landmark reached for thefirst time in five years.

Meanwhile, the company hassliced its automotive market intothree segments - the people-moversegment with its commercial ve-hicles and e-vehicles, theaspirational-lifestyle segment,which is its core SUV business, andthe object-of-passion segment,which is being addressed byPininfarina Battista and Jawa.

M&M sees Ssangyong in SouthKorea, Peugeot Scooters in France,Automobili Pininfarina in Italy andMahindra North America in the US

as key group companies to grow theMahindra Automotive Group's foot-print beyond organic expansion intoChile, South Africa, South-East Asiaand the SAARC region under theMahindra brand. "Instead of stretch-ing the Mahindra brand across seg-ments, which may not find relevance,the company will rely on a bouquet ofbrands globally to expand the foot-print of Mahindra AutomotiveGroup," reveals Mr Mahindra.Pininfarina Battista, which is set todebut in 2020, may perhaps turn outto be the rose in M&M's bouquetof brands.

"Instead ofstretching theMahindrabrand acrosssegments, thecompany willrely on a

bouquet of brands globally toexpand the footprint of MahindraAutomotive Group."

ANAND MAHINDRAChairman, Mahindra Group

"The Battista isthe hypercarof the future,inspired by alegendarypast. Itcombines true

inspiration and innovation in itstechnical achievement andemotional appeal."

MICHAEL PERSCHKECEO, Automobili Pininfarina

pany went on to snap up many enti-ties at home and abroad. Buying SouthKorean Ssangyong Motor in 2010helped M&M make global foray in abig way with premium SUVs. Backhome, Mahindra's Reva deal in thesame year helped it enter the fasci-nating world of e-vehicles. In 2012,Mahindra bought US-based Navistar,which gave it access to trucksand buses.

M&M has made close to 35 acqui-sition deals over the last decade.These deals, along with its own stresson research and development (R&D),have resulted in many, world-class

Pininfarina Battista, the world's fastest,e-car, combines extreme engineering andtechnology in a zero-emissions package.


IBJ BUREAU

Burj Khalifa in Dubai, the world'stallest building, makes use of thesepumps for its desalination plant.Most of the world's iconic buildingstoo bet on these pumps for their effi-cient water supply.In fact, last July, these very pumpswere used to de-water a cave in MaeSai, Thailand, and save 12 membersof a football team who were trappedin it for 17 days.These pumps are also widely used byoil and gas, marine, defence, nuclearpower and other industries as wellas in firefighting.

Welcome to Pune-basedKirloskar Brothers (KBL),which manufactured these

pumps. And away from the limelight,Kirloskar's pumps are installed in mil-lions of residential and commercialcomplexes across the world.

Last month, KBL crossed yet an-other major landmark. The flagshipcompany of the around Rs 14,000-crore Kirloskar Group - with interestsin pumps, fluid management solu-tions, engines, generator sets, powersolutions, pig iron, castings, compres-sors and transmission equipment,among others - entered the centenaryyear of its existence. The occasion wasmarked by Ratan Tata, an eminent in-dustrialist and Chairman Emeritus ofTata Sons, unveiling KBL's new Codeof Ethics to strengthen its century-old values at a glittering ceremony inPune. The memorable event was at-tended by a galaxy of leaders of IndiaInc, several members of the Kirloskarfamily, other dignitaries as well as emi-nent scientist R A Mashelkar.

A rich heritage of innovation and entrepreneurship haskept Kirloskar Brothers, which recently entered thecentenary year, brimming with energy and enthusiasm.

the right skills would help Indian in-dustry create an enabling environ-ment and facilitate the country's bud-ding engineers to achieve their right-ful place in the world. An Englishtranslation of the biography of KBLfounder Laxmanrao Kirloskar - TheMan Who Made Machines (originallypenned by Shankarrao Kirloskar inMarathi) - was released at the cente-nary celebrations.

Hoary pastGoing back beyond a century,Laxmanrao Kashinath Kirloskar setup a tiny bicycle shop in Belgaum,Karnataka, in 1888. The road on whichthe cycle shop was set up is todaynamed Kirloskar Road. It would notbe an exaggeration to say that theroots of Rs 1,931-crore KBL lay deeplyentrenched in that humble bicycleshop. The same entrepreneurial spirit,which pushed Laxmanrao Kirloskar toset up the cycle shop, got him to moveahead and start something bigger.

The Kirloskar founder's penchantfor technology, coupled with a nimblebusiness sense, led him to create thefirst Kirloskar products -an indig-enous hand chaff cutter in 1901 andan iron plough in 1903. The time hadarrived for Laxmanrao to give his in-novation-led business a formal touch.So, in 1920, he incorporated a companyand named it Kirloskar Brothers.

In 1936, Laxmanrao passed on theresponsibilities of KBL to his son,Shantanurao Kirloskar. The second-generation leader brought in furtherinnovation to the pump manufacturerby unveiling the country's earliestmachine tool and an electric motor. Healso expanded KBL's footprints in theEuropean market, North America andSouth-East Asia.

Then in 1985, Sanjay Kirloskar, thegrandson of Shantanurao Kirloskar,took over the leadership of KBL andsoon got the pump manufacturer toembrace the fourth industrial revolu-tion. Under him, KBL expanded itsproduct portfolio to include cannedmotor pumps, solar pumps, concrete

Laxmanrao Kirloskar: The patriarchwho started it all over a century ago

100 Not Out

The revised Code of Ethics aims atturning KBL into a world leader influid-management solutions. It alsoplans to deploy disruptive technolo-gies, like internet of things, artificialintelligence, 3D printing, virtual real-ity and augmentative reality, for intro-ducing end-to-end process revolutionfor its products and services.

"There will be an even strongeremphasis on product research anddevelopment, embracing new tech-nologies for innovation, besides in-culcating a strong value systemacross the group," emphasised KBLChairman and Managing DirectorSanjay Kirloskar at the centenary cel-ebrations. The 61-year-old, great-grandson of Laxmanrao Kirloskar - thelegendary industrialist and founder ofKBL - has spearheaded KBL toemerge as one of the reputed pumpmanufacturers in the world.

Rama Kirloskar, KBL's non-execu-tive director and MD of KirloskarEbara Pumps, who was also presenton the occasion, highlighted the needfor improving engineering skills at thegrassroots level. She also noted that

CORPORATE REPORT


"There will be an even strongeremphasis on product researchand development, embracingnew technologies for innovation,besides inculcating a strongvalue system across the group."SANJAY KIRLOSKAR, CMD, KBL

KBL: A Fact File1920Origin

Pumps & fluidmanagement solutionsBusiness

PuneHeadquarters

15Plants

Rs 1,931 croreFY18 revenue

volute pumps and magnetic drivepumps. With stress on innovation,KBL soon became India's largest cen-trifugal pump manufacturer. Witheight manufacturing facilities in India,including the first one inKirloskarwadi, and seven abroad, KBLmade a stunning transformation froma pump manufacturer to a completefluid management solutions company.KBL's success was, however, marredby a bitter feud in the Kirloskar family.

The fourth generation of theKirloskars suffered a serious split be-tween Sanjay Kirloskar and his sib-lings Atul and Rahul Kirloskar, whoare at the helm of affairs at KirloskarIndustries (KIL) - engaged in windpower generation and real estate. Thewarring Kirloskar brothers have filedcases and counter-cases against eachother in various courts in Pune,Mumbai and Karnataka as well as inthe National Company Law Tribunal.These cases relate to alleged insidertrading charges, alleged suppressionand oppression at KBL and allegedmismanagement at Pune's KirloskarInstitute of Advanced ManagementStudies.

Led by innovationMeanwhile, KBL is focused on mak-ing advancement in manufacture ofpumps, valves and turbines and alsoexpanding the range of turbines. Evenas company after company is chant-ing the diversification mantra, at KBLthe focus has been and will be itscore strength of manufacturing world-class pumps.

In fact, KBL boasts of being among

the first Indian companies to embracethe fourth industrial revolution, withits foray into 3D printing and internetof things. "We are the only pump com-pany in the world to have such ma-chines," adds Sanjay Kirloskar, speak-ing about the company's 3D printingfacility.

For the last 10 years, KBL has beenremotely managing the water supplysystem to Kirloskarwadi, 200 km fromPune. The remote operation gives thecompany's engineers an insight intothe performance of pumps and timelyalerts on spares. It also opens a floodof business opportunities. The soft-ware that runs the system minimisesbreakdowns, creates alerts and en-sures that water is available to theplant and the small township of 1,800residents in Kirloskarwadi.

Having entered the centenary year,top leaders, scientists and managersat KBL are brimming with energy andenthusiasm. They are looking up topatriarch Laxmanrao Kirloskar'szeal for innovation that put thepump-maker among the leadingglobal players.


IBJ BUREAU

The Boeing Company is facinggrowing headwinds followingtwo air crashes in a span of five

months. The Chicago, US-based air-craft manufacturer finds itself in thedock after the two air mishaps -Indonesia's Lion Air Flight 610crashed last October, killing all 189passengers and crew and EthiopianAirlines Flight 302 crashed inMarch this year, leaving all 157 peopleaboard dead.

Boeing 737 Max 8 jets, introducedby Boeing in 2017, were involved inboth the air crashes. Besides the air-craft, there seemed to be other simi-larities between the two dastardly airaccidents. It is learnt that the pilotsof both the ill-fated airlines were al-legedly unable to control the planesafter an automated system was pos-sibly erroneously activated.

Over 20 countries, including India,have grounded more than 300 Boeing737 Max jets worldwide after the twofatal crashes. The first countries toban the controversial aircraft wereChina and the European Union. Soonto follow were Argentina, South Af-rica, Brazil, Mexico, Indonesia, Ethio-pia, Australia, Singapore, Oman, Ma-laysia, India and the USA. The USaviation regulator, the Federal Avia-tion Authority (FAA), had earlier re-fused to suspend the aircraft. How-ever, it later bowed down to mount-ing pressure and banned the air-craft until further safety measureswere introduced.

The US aircraft-maker has, in themeanwhile, stopped delivery of allnew 737 Max jets to its customers.Indonesia's flag carrier Garuda hascancelled an order for 49 MAX 8aircraft, becoming the first airline toconfirm plans to cancel an order af-ter the crashes. Boeing's shareshave fallen by over 12 per cent sincethe Ethiopian Airlines crash ofMach 10, wiping out more than $28billion from the aviation company'smarket value.

Two major air crashesinvolving Boeing 737 Maxjets put the spotlight onthe American plane-maker and possible,compromised, USregulatory system.

Supervisory loopholesMultiple agencies and investigatorsfrom the US and other countries arelooking to uncover the causes for thetwo air crashes. The big question oneveryone's mind is whether the plane'ssoftware is to blame?

Preliminary reports from the twoaccidents indicate that a faulty sen-sor erroneously reported that thedoomed airplanes were stalling. Thefalse reports triggered an automatedsystem, known as the ManoeuvringCharacteristics Augmentation System(MCAS). This system tried to pointthe planes' noses down so that theycould gain enough speed to fly safely.

The MCAS takes reading from asingle sensor that determines howmuch the plane’s nose is pointing upor down relative to oncoming airflow.When MCAS detects that the planeis pointing up at a dangerous angle, itcan automatically push down thenose of the plane in an effort to pre-vent the plane from stalling.

A fortnight after the Ethiopian Air-lines mishap, the US aircraft manufac-turer has said that it has fixed theMCAS. The update will ensure thatMCAS will now receive data from twoangle of attack (AoA) sensors insteadof just one. Boeing engineers haveadded that if both these AoA sensorsdisagree by more than 5.5 degrees, theMCAS system will be disabled and

will not push the nose of theplane lower.

"Boeing understands that livesdepend on the work we do. We aretaking steps to fully ensure the safetyof the 737 Max jets in the wake of thedeadly crashes," Boeing CEO DennisMuilenburg had noted, speaking to

the media after the EthiopianAirlines crash.

The airplane manufacturer re-veals that the decision to includethe MCAS to the flight control op-erations was not arbitrary. Whenthe company had designed the Maxjets, it had made the engines largerto increase fuel efficiency and po-sitioned them slightly forward andhigher up on the plane's wings.

These tweaks had changed howthe jet was handled in certain situa-tions. The relocated engines causedthe jet's nose to pitch skywards. Tocompensate, Boeing had added acomputerised system called MCAS

More than 300 Boeing 737 Max jets havebeen grounded worldwide after two fatalair crashes.

FOCUS


JoltsFromTheBlue

JoltsFromTheBlue

Wreckage at the Ethiopian Airlinescrash site

to prevent the plane's nose from get-ting too high and causing a stall.MCAS is unique to the Max jets andis not present in other Boeing 737s.

The MCAS would always get acti-vated without the pilot's input. Thishad led to some frustration amongpilots of the 737 Max jets. On anotheroccasion, at least half a dozen pilotshad reported being caught off guardby sudden descents in the aircraft.

When Boeing's European rival Air-bus had announced in 2010 that itwould make a new, fuel-efficient andcost-effective plane, Boeing hadrushed to get out its own version.That version was the 737 Max air-planes. Moreover, it appears to be thathurry for which the US aircraft-makermay end up paying heavily.

That hurry is believed to have evengot regulator FAA to relax certainstringent certification norms. Whenthe Max jet was under development,regulators had determined that pilotscould fly the planes without extensiveretraining because they were essen-tially the same as previous genera-tions. This decision of the FAA hadhelped Boeing save a lot of money onextra training, which aided the com-pany in its competition with Airbusto introduce newer, more fuel-efficientairplanes. So, rather than hours-longtraining sessions in giant, multi-mil-

lion-dollar simulators, many pilots aresupposed to have learned about the737's new features on an iPad.

Even the approval process forBoeing's Max jetliners were allegedlyrushed and possibly compromised,according to some reports in the USmedia. The reports reveal that theFAA's managers had pushed theagency's engineers to delegate safetyassessments to Boeing itself andspeedily approve the resulting analy-sis. Under pressure to approve its newMax jets so that it could catch up withAirbus, Boeing had turned in a safetyassessment to the FAA that wasriddled with errors.

now seems to have led to lapses onaircraft safety. Other aircraft manufac-turers, such as Canada-based Bom-bardier and Brazil-based Embraer havebeen scaling up but are still relativelyquite small in size. Among others, theChinese and the Russians have alsogot into aircraft manufacturing. Evenso, most planes ordered across theglobe, including in India, are fromBoeing and Airbus.

The repercussions of the Indianaviation regulator, the DirectorateGeneral of Civil Aviation, banning theBoeing 737 Max jets are already be-ing acutely felt. The jets in questionare operated by two airliners - Jet Air-ways and SpiceJet. Jet Airways ownsfive of these planes, but all of themhave previously been grounded dueto the airline's financial troubles.SpiceJet's fleet of 13 Max jets weregrounded later on immediately afterthe regulator's order. The shortage ofaircraft hence has led to skyrocketingof air fares, causing hardship to airtravellers.

Besides, for India, there are impor-tant takeaways from the two air acci-dents. One, the DGCA should en-hance capacity and tighten thescrews to assess and certify foreign-made aircraft independently and rig-orously. Relying solely on reputa-tions of foreign regulators is fraughtwith risk. Moreover, pilot training sys-tem in India is also a cause for con-cern. "Training levels among Indianpilots has been among the lowest inthe world. While the Western airlinesdo pilot training of level four,Indians are at level one," points outSridhar Krishna, the CMD ofSankhya InfoTech.

Moreover, being among the fast-est-growing, major, aviation marketsin the world, India must shake off pastsetbacks and step on the gas to de-velop civilian aircraft on an industrialscale. This can be a real Make-In-In-dia initiative with a host of positive,long-term spin-offs.

"Boeing understands that livesdepend on the work we do. Weare taking steps to fully ensurethe safety of the 737 Max jets inthe wake of the deadly crashes."

DENNIS MUILENBURGCEO, Boeing

Vital issuesThe extent of the rot at Boeing as wellas in the US air regulator is nowgradually coming out in the open. TheUS' Department of Transportation'sInspector General, in the meantime, isprobing the FAA's approval of theMax jets. The department's investiga-tion is focused on the FAA's Seattleoffice, which certifies the safety ofnew aircraft.

The air crashes also shine a spot-light on the largely duopolistic natureof the global aircraft industry, with gi-ants Boeing and Airbus in a long-run-ning intense dogfight to dominate theairspace. This race for dominance


COVER STORY


FIRED UP

Barring a few concerns, Indian startups look setfor a grand takeoff, aided by huge funding and

favourable government policies.IBJ RESEARCH BUREAU

The numbers are simplymind-boggling. India ishome to more than 39,000active start-ups - new en-tities in search of suc-

cessful business models. Of these,over 7,700 are technology or techstartups, entities that deal solely intechnology products and services. Italso has 26 unicorns - a privately-heldstartup valued at over $1 billion.

Some 15,113 startups have beenrecognised by the government since2016, when the ambitious Startup In-

dia programme was rolled out. Thegovernment-registered startups arenot just limited to Bengaluru, Delhi-NCR, Mumbai, Chennai and Pune -the country's thriving startup hubs.They are active in 492 districts across29 States and six Union Territories.About 55 per cent of the recognisedstartups are from tier-I cities. But sur-prisingly, the remaining 45 per cent ofthe startups are from tier-II (27 percent) and tier-III (18 per cent) citiesand towns.

Beyond the bland numbers are thespicy success stories of startups,shaped by grit, determination and, of

course, winning business strategies.It is the story of several internet com-panies - such as food delivery appsSwiggy and Zomato; hotels platformOyo; online insurer Policybazaar; B2Bmarketplace Udaan; software providerFreshworks; online retailer Paytm Malland education technology startupByju's - entering the unicorn club. Itis also the tale of digital paymentscompany Paytm turning into the most-valued unicorn in the Indian startupecosystem and earning the distinc-tion of becoming the country's firstdecacorn (a unicorn with valuation of$10 billion).

Incidentally, all these inspiring de-velopments happened last year. In fact,it would not be wrong to describe 2018as the year of the rebirth of Indianstartups. The boom years of 2014 and2015 had put startups on steroids withhuge funding and got them to growand expand rapidly. It was followedby drying up of private equity (PE)and venture capital (VC) in 2016 and2017, leading to valuation of startupsplunging, along with massive layoffsand a few startups shutting shop.

In 2018, the world's top technol-ogy financiers and PE firms were backin India with huge funding plans. Glo-bal giants, such as Japan's SoftBank,Tencent and Alibaba from China, US-based Accel Partners and SequoiaCapital, among others, were back witha bang, signing off big, fat chequesto start-ups. The country's startups

FIRED UP

In around a decade, India has becomethe world’s third-largest startup hubafter the USA and China.


Having thriven at home, Indian startups Ola and Oyo have venturedoverseas.

Last year, Paytm became thecountry’s first decacorn.

39,000+Active startups

15,113Govt-recognisedstartups

7,700+Tech startups

26Unicorns

55%Startups in tier-I cities

45%Startups in tier-II,-III cities

Startups In Numberssaw 108 per cent growth in total fund-ing from $2 billion in 2017 to $4.2 bil-lion last year, according to softwareservices body National Associationof Software and Services Companies(NASSCOM).

With huge funding and cut-throatcompetition, startups expanded in abig way from metros and big cities totier-II and -III cities and towns. Small-town India too enthusiasticallylapped up new lifestyles by hailingtaxi aggregator Ola for movingaround and ordering food fromSwiggy and Zomato.

Smaller cities, such as Kochi,Coimbatore, Jaipur, Chandigarh,Lucknow, Indore and Ahmedabad,became the new hubs for startups.These hubs gave rise to many home-grown stratups, which designed theirproducts and services aimed at solv-

policies and growing riskappetite of Indian entrepreneurs, hasled to a startup boom in the country.

In fact, the Indian startup ecosys-tem has itself matured well over thepast decade. It has gone through acycle of boom, bust and exits andproved beyond doubt that Indianstartups too have the ability to returncapital with profits to its investors.And that ability was aptly displayedin acquisition of Flipkart, India's larg-est homegrown e-tailer, by Walmart,the world's largest discount storechain, last August. Flipkart's inves-tors, including SoftBank, Tiger Glo-bal and Naspers, among others, madehandsome gains from the $16-billionsale of the e-tailer.

"The Indian VC industry is matur-ing, and you are finding proof of fundsgoing after fewer but better quality

ing local problems, ranging acrosshealthcare, education, agriculture andfinancial services, among others.Government-funded incubators andaccelerators - supportive infrastruc-ture that help new startups to suc-ceed - facilitated the startup cultureto blossom in the remote corners ofthe country. These incubators helpedstartups tide through early challengesby providing them access to mentors,interns, seed funds (grants or equity),testing labs and so on.

Having thriven at home for nearlya decade, India's startups went glo-bal last year. Ola, the country's, larg-

est, homegrown, ride-hailing com-pany, set the ball rolling last Januarywhen it drove into Perth, Australia.Soon, hotel chain Oyo followed in abig way. Last year, Byju's, thecountry's newest unicorn, an-nounced its international plans forearly 2019.

In around a decade, India hasscaled to become the third-largeststartup hub of the world after the USAand China. A combination of factors,including maturing of economicliberalisation, rising disposable in-come, rapid, smartphone-led internetpenetration, favourable government

deals after building their initial port-folio," points out Bain & CompanyPartner Arpan Sheth.

3-decade journeyThe past decade has, in fact, put In-dian startups on the fast growth track.However, the seeds of this inspiringstory were sown over three decadesago. In the mid-1980s, Rajiv Gandhi,the then prime minister, liberalised thecomputer industry and unleashed achain of events that finally led to theFlipkarts and Olas calling the shots.

A turning point in the Indianstartup story was setting up of


COVER STORY

The Walmart-Flipkart deal proves that Indian startups too have the abilityto return capital with profits to their investors.

"The Indian VC industry ismaturing, and you are findingproof of funds going after fewerbut better quality deals afterbuilding their initial portfolio."

ARPAN SHETHPartner, Bain & Company

The Journey Of Indian Startups

Triggered by then PrimeMinister Rajiv Gandhi'sliberalisation of computerindustry in mid-1980s

Foundation laid by first waveof start-ups, like Infosys(1981), Tally (1986) and otherblue-chip IT companies

Formation of NASSCOM in1988, a turning point

Nurtured by orgnaisations,like iSPIRT, TiE, etc

Third wave of start-ups from2007 onwards with settingup of Flipkart, Zomato, etc

NASSCOM in 1988. Over the years,the software services body spawnedan army of information technology(IT) companies, which themselveswere the first Indian tech startupsback then. It was the first wave ofstartups that laid the firm foundationof an effective ecosystem. Apart fromTCS, which had been incorporatedway back in 1968, Infosys in 1981 andTally in 1986 were among thecountry's earliest tech startups thatbecame blue-chip IT companies,going ahead.

The second wave of the Indianstartup industry coincided with thedotcom boom of the mid-1990s which

extended up to the mid-2000s. In 1995,VSNL launched the first commercialinternet service and exposed Indiansto the mesmerising World Wide Web.Soon, many enterprising Indians wereable to launch businesses that werepowered by the internet. Info Edge -which gave birth to India's first onlinejob recruitment (naukri.com), matri-mony (jeevansaathi.com) and real es-tate (99acres.com) websites - newsand entertainment portal Rediff.cominspired many more young entrepre-neurs to weave successful Web-based businesses.

Then from 2007 onwards began thethird wave of startups that has pro-vided a big push to new businesses.Flipkart marked its entry in 2007 asthe country's first e-commerce startup,and later in 2008, Zomato and onlineclassified advertisements platformQuikr came into the picture. Thesestartups are now over a decade oldbut still sailing on their first-mover ad-vantage. The economy was not readyback then, but the novelty of ideafetched them high revenues as theyprogressed. Soon followed onlinetravel startup yatra, MakeMytrip, Ola,Paytm and Freshdesk, and there wasno looking back.

Innovative ideas and huge risk ap-petite of some entrepreneurs un-doubtedly played a vital role in turn-

Flipkart’s warehousing facility on the outskirts of Hyderabad

Debut of homegrown VCfunds with foundation ofTDICI, promoted by ICICI andUTI, in 1988 and CanbankVenture Capital Fund in 1989

Second wave of startupcoinciding with the dotcomboom of the mid-1990s

VSNL's first commercialinternet service launched in1995 a big push for Web-based startups, like Info Edgeand Rediff.com


Kerala’s Startup Village, one of the pioneersof startup infrastructure in India

Government-funded incubators and accelerators are facilitating startupsto blossom across the country.

Boost From Startup India

19-point Startup India ActionPlan unveiled by PM Modi inJanuary 2016

Setting up of incubationcentres across India

Norms eased for filing patents

Tax exemptions and normseased for setting up business

Rs 10,000-crore fund,managed by SIDBI, topromote startup culture acrossthe country

Inspired by Startup India, 24State-specific policieslaunched

One of the biggest pushes to thecountry's startup ecosystem camefrom Prime Minister NarendraModi's Startup India programme.

ing India into a major startup hub.Equally important were the otherstakeholders of the ecosystem -sup-portive organisations, such as TheIndus Entrepreneurs (TiE),NASSCOM, Indian Software ProductIndustry Round Table (iSPIRT) andHeadstart and so on, and various in-cubators and accelerators, such asCIIE, IIIT Hyderabad, StartupVillage and Microsoft Ventures,among others - who nurtured andbuilt the startup ecosystem into whatit is today.

In fact, way back in 1988, the gov-ernment of the day set up Technol-ogy Development and InformationCompany of India (TDICI), promotedby ICICI and UTI, marking the begin-ning of homegrown VC fund. It wasfollowed by Canbank Venture CapitalFund in 1989. It was only decades laterthat VC and PE firms from abroad en-tered India as the startup culture be-gan showing signs of maturity.

Besides, NASSCOM kicked off its10,000 Startups initiative in 2013,aimed at facilitating growth of 10,000startups in the country over the next10 years. The objective of the initia-tive was to foster the startup ecosys-tem and build entrepreneurial capa-bilities through the FAME (Funding,Acceleration, Mentoring and Enter-prise Connect) model. This initiativehelped spread a robust startup cul-ture across the country.

Perhaps one of the biggest pushesto the country's startup ecosystemcame from Prime Minister NarendraModi's Startup India programme. InAugust 2015, Mr Modi announced theStandup India campaign to encour-age young Indians to take up the en-trepreneurial route. The campaign wasaimed at facilitating startups in get-ting bank funding. Later, in January2016, Mr Modi unveiled the StartupIndia programme with manypathbreaking initiatives to buildstrong, conducive, growth-orientedenvironment for Indian start-ups. The19-point Startup India Action Plan en-

visaged several incubation centres,easier patent filing, tax exemptions,ease of setting up of business and aRs 10,000-crore fund, among others,to promote the startup culture acrossthe country.

Interestingly, Startup India in-spired States to roll out their ownstartup policies. Before Startup Indiawas launched, there were only fourStates with specific startup policiesin place. Today, 24 States have intro-duced their own startup policies.

In the past few years, several States

have taken the onus to build their ownincubators and co-working hubs toboost innovation in their respectiveStates. Rajasthan's BhamashahTechno Hub - one of the largest incu-bators in the country - Kerala's Inte-grated Startup Complex inKalamassery, Kochi - one of the big-gest co-working spaces in India - andKarnataka's credit line of Rs 2,000crore for strengthening the startupecosystem in the State, among oth-ers, have fast-tracked the growth ofstartup culture across the country.


COVER STORY

"Entrepreneurs in the SiliconValley built products for the firstbillion people on the planet.India is poised to serve the nextsix billion."

SHARAD SHARMACo-Founder, iSPIRT

If startups registered with DPIIT

If aggregate amount of paid-up share capital and share premiumdoes not exceed Rs 25 crore - increased from Rs 10 crore earlier

If startups register annual sales of Rs 100 crore - raised from earliersales of Rs 25 crore

Startup to be eligible for tax relief for up to 10 years from the date ofincorporation - up from earlier seven years

Share premium not to be invested in land and residential buildingother than those used by the business

Share premium not to be invested in shares, securities, jewellery orvehicles priced above Rs 10 lakh other than those used by thebusiness

If shares sold by startup to listed companies with net worth ofRs 100 crore or annual sales of Rs 250 crore

If shares sold by startup to NRIs or Alternative Investment Funds-Category-I registered with SEBI

Angel Back In Tax?

Some changes bring relief to start-ups.Section 56 (2) (viib) of the Income Tax Act, 1961, referred to asangel tax, which treats excess capital (share premium above facevalue of share) raised by a company as income and taxes it at 30%,will not apply in following instances:

The Department for Promotion ofIndustry and Internal Trade (DPIIT -formerly Department of IndustrialPolicy and Promotion or DIPP), underthe Union Ministry of Commerce andIndustry, has been providing huge im-petus to the country's startups. Infact, since 2016, 15,113 startups havebeen registered with DPIIT while manymore are expected to sign up with thedepartment in coming years.

In fact, DPIIT's ranking of Statesin terms of their startup ecosystem hasencouraged the States to come outwith the best startup policies and

programmes. The recently releasedState Startup Rankings of DPIITplaced Gujarat as best-performingState, while Karnataka, Rajasthan,Odisha and Kerala took the title of top-performing States.

The figures of the startup ecosys-tem enablers, such as incubators andaccelerators, have gone up to over230 in the past few years. With morethan 100 incubators and acceleratorsin the corporate sector, over 95 in theacademia, more than 20 set up by Cen-tral and State governments and over14 under the international startup ex-

change missions, the supportive in-frastructure and institutions havegrown manifold in recent times.

Some challengesIndian startups have registered phe-nomenal growth in the past few years.However, they are dogged by severalchallenges which have held them backfrom growing to their full potential.The biggest challenge is still funding.Last year saw over double the rate ofgrowth of funding for startups. Butthat figure does not tell the full story.The largesse from PE and VC fundswere limited to established startups.

In fact, it has been an ongoingstruggle for budding or early-stagestartups to access funds. There wasa decline in funding for startups atthe seed stage from $191 million in2017 to $151 million in 2018, even asestablished startups continued to bepampered with fat cheques.

"Despite Flipkart's sale to Walmartfor a whopping $16 billion, there isstill a huge opportunity gap in India'sstartup ecosystem. Many entrepre-neurs do not have equal access tocapital that would benefit India's widereconomy," points out Nitin Rai, thechairman of the board of trustees ofTiE Global, a Silicon Valley non-profitorganisation that supports startupsthrough networking, mentoring andhelping with fundraising.


Hurdles Before Startups

Ongoing struggle for buddingor early-stage startups toaccess funds

India lagging behind America,characterised by ventureinvesting and culture ofinnovation

Doing business in India stillcumbersome despiteimproved EoDB ranking

Setting up business a long-drawn process, comprising atleast 12 steps

High Stamp Duty andregistration charge a drain onstartups' finances

A lack of innovation andabsence of new technologiesa big drawback

Angel tax and other policyissues haunting startups

"Despite Flipkart's sale toWalmart for a whopping $16billion, there is still a hugeopportunity gap in India's startupecosystem. Many entrepreneursdo not have equal access tocapital that would benefit India'swider economy."

NITIN RAIChairman, TiE Global

India may be home to the world'sthird-largest startup ecosystem, givenits sheer size. But the country'sstartup ecosystem is still in its infancyand has much to achieve. India is noAmerica, where venture investing andthe culture of innovation in technol-ogy have evolved and matured overseveral decades.

For all the hype over boomingstartups, India lags far behind in termsof the intrinsic requirements for aprosperous startup ecosystem. Thecountry may have scaled the ranks ofWorld Bank's Ease of Doing Business(EoDB) rapidly from the 142nd slot in2014 to 77th position in 2018. How-ever, the EoDB ranking hardly reflectspan-India reality, as the survey cov-ers only Delhi and Mumbai.

So, doing business in India is stilla cumbersome issue. Establishing alegal entity for business is a long-drawn process, comprising at least 12steps and costing about 50 per centof the per capita income, according toan analysis. Besides, it takes almost amonth, 27 days to be precise, to com-plete these procedures on an average,which is well above the average of 12days in the Organisation for EconomicCooperation and Development(OECD) countries.

Registering a property requiresquite a bit of legwork and can alsoincur substantial costs. A Stamp Dutyof 5 per cent of the property and 1 percent of the market value of the prop-erty as registration charges at the sub-registrar's office can be a drain on astartup's meagre finances. It takes al-most infinite time to resolve insol-vency in India, far longer than the av-erage time taken in South Asian andOECD countries. Moreover, a labori-ous legal process can often put smallbusinesses in a tight spot.

A recent joint study by the IBMInstitute for Business Value and Ox-ford Economics points out that 90 percent of Indian startups fail within thefirst five years of incorporation. Thestudy cites a lack of innovation and

absence of new technologies as ma-jor reasons among others for the shortlives of startups.

One of the essential parameters ofmeasuring the quality of a startup hubis the innovation that comes out of it.India's startup ecosystem, for all itstall claims, is nowhere near the top.According to the Bloomberg Innova-tion Index 2019, India has been ranked

a lowly 55 in the world. And, interest-ingly, it is for the first time that Indiahas made it to this position.

Startup ecosystems are also mea-sured by the number of intellectualproperty rights (IPRs) they hold. Go-ing by the number of patents filed byIndia in 2017 and 2018, it does noteven count among the top-10 coun-tries in the world. The Uniongovernment's 80 per cent exemptionof cost of IPR filings for startups,along with the remaining 20 per centexempted by many State govern-ments, has done little to boost pat-ents of startups.

For all its startup-friendly postur-ing by the government, it is rather in-triguing that the angel tax issueshould haunt Indian start-ups for solong. The recent changes to Section56 (2) (viib) - often referred to as theangel tax - of the Income Tax Act comeas a big relief for many startups. Yetthere are many unresolved issues inthe tax tangle that continue to bogdown startups.

Meanwhile, the big-bang expan-

After a dry spell of 2016 and 2017,total funding in Indian start-upsmore than doubled to $4.2 billionin 2018.

e-commerce continues to be the biggest bet for entrepreneurs andinvestors, going ahead.

COVER STORY


sion of established startups has comeat a huge cost. The combined lossesof just five of India's most funded andcelebrated internet firms - Paytm,Flipkart, MakeMyTrip India, Swiggyand Zomato - were at Rs 7,800 croreduring the financial year ended March2018, according to business researchplatform Tofler. Startups in India seemto focus more on grabbing marketshare than controlling their costs.This approach could hurt startups, astheir paymasters would simplytighten their purse strings if the lossescontinue unabated for a longer time.

Huge potentialSome of the challenges before the In-dian startups are indeed serious. Butthere is no room for gloom, as there ishuge potential for startups waiting tobe tapped. With smartphone users setto rise to more than 50 crore in 2021from the current over 34 crore, Indiacould become a market where inno-vations are tested. Deeper penetrationof internet, driven by growing num-ber of smartphones, and thegovernment's push towards digitalinitiatives are expected to providehuge impetus to startups with inno-vative business ideas.

Meanwhile, e-commerce continuesto be the biggest bet for entrepreneursand investors. Moreover, enterprise

software, fintech, healthcare, retail,education and biotechnology alsohold out a lot of potential for futuregrowth. Funding too is set to be easyfor start-ups with brilliant ideas. "Bigfunds are flush with cash and lookingto invest large cheques. India shouldget between $12 billion and $15 bil-lion in investments in 2019 as manysoonicorns (startups with potential tobecome unicorns) raise capital and

break out," notes Manipal Global Edu-cation Chairman Mohandas Pai.

Analysts note that food deliverywill see a battle as bloody as e-com-merce, as Swiggy and Zomato clashwith each other. Besides, relatively-latest entrants, like Ola withFoodpanda and UberEats, will try tofind new revenue streams, furtherchipping away the market share ofolder players.

Generic solutions will continue tobe built by using technology. Com-ing years should address many areas,such as low availability of water ortraffic jams, which have been ignoredby the big names and create a massimpact with disruptive startup ideas.Startups can also design novel ideasand business plans that will addressfarm- and farmer-related issues. Thereis also a big market waiting to betapped for solutions to micro, smalland medium enterprises (MSMEs),linking up of local artisans with therest of India and abroad and so on."Entrepreneurs in the Silicon Valleybuilt products for the first billionpeople on the planet. India is poisedto serve the next six billion," forecastsiSPIRT Co-Founder Sharad Sharma."

A recent NASSCOM report revealsthat growth in the startup ecosystemhas led to creation of 40,000 new di-rect jobs in 2018, with the total em-ployee base in startups pegged atabout 1.7 lakh as of 2018-end. By col-laborating with brick-and-mortar in-dustry and social organisations,startups can make the economy andsociety function more effectively andmeaningfully.

Startups, in the meanwhile, havemoved away from the fringes and areoccupying the mainstream of the In-dian economy today. Both the Unionand State governments havefortunately realised the huge benefi-cial impact of startups on theeconomy. It is time that they correcteda few anomalies in the policies formany more startups to bloom andsustain growth.

"Big funds are flush with cashand looking to invest largecheques. India should getbetween $12 billion and $15billion in investments in 2019 asmany soonicorns (startups withpotential to become unicorns)raise capital and break out."

MOHANDAS PAIChairman,

Manipal Global Education

IBJ BUREAU

India's highly ambitious solarpower target of 1,00,000 mw by2022 now appears highly unlikely

to be met. A lack of clarity on policyissues, frequent cancellation of bidsand Safeguard Duty on solar panelsand other equipment, among otherfactors, have dimmed the prospectsof solar power in India.

Up until last year, solar power wasplaying out as a shining successstory. From a mere 2,600 mw in 2014-15, installed capacity of solar powerhad surged almost ten-fold past 25,000mw by 2017-18. But the calendar yearof 2018 witnessed the glorious sungradually beginning to set as a slew offactors began hampering the sector.

Even last year, brushing aside theadverse developments, the countryadded around 8,900 mw of solar power,taking the totalled installed powerfrom the sun to a little over 27,900 mw.Surprisingly, the solar power additionin 2018 accounted for over half of thetotal power installed from all sourceat 17,600 mw. Besides, total solarpower accounts for 7.91 per cent ofthe total installed capacity from allsources as of December 2018.

A mix of unfriendly policies, ill-conceived measuresand adverse conditions dims the prospects of thesunrise sector.

But that dream run is now peteringout. By the end of 2018, India couldachieve only about 28 per cent of itsmammoth 1,00,000 mw solar powertarget by 2022. And with four moreyears to go, the lofty goal appears adistant dream. In a recent report, rat-ing agency CRISIL notes that Indiacould at best hit 60,000 mw by 2022,falling short by 40 per cent or a whop-ping 40,000 mw.

"The Indian solar market has grownspectacularly over the last four yearsbut is struggling to sustain becauseof policy and execution challenges.The slowdown is worrying for allstakeholders," points out VinayRustagi, the managing director ofBridge To India Energy, a leading re-newable energy consultancy firm.

Unending problemsA string of woes in the past one yearhas turned the scorching solar sectorcold. A continuous fall in tariffs overthe past eight years, especially asharp plunge in the past two years,has put a question mark on the viabil-ity of projects. "With low tariffs, theremay be a compromise in quality ofproducts used in setting up of plants,"avers Amplus Energy SolutionsFounder and CEO Sanjeev Aggarwal.

As late as 2010, solar power usedto cost Rs 17 per unit. From then on,

there was a continuous decline andthen a steep fall to Rs 2.44 per unit intwo auctions of 2017 and 2018. In theireagerness to bag projects at auc-tions, developers in both wind andsolar bid and won projects at tariffsthat will practically turn the projectsunviable.

Solar power producers quotedprices at jaw-dropping lows withoutconsidering the other factors thatwould put their projects in peril. Butwith interest rates hardening last year- interest rates have now started drop-ping again - project developers hadto bear the high cost of interest. Therupee's plunging against the dollarfurther strained their balance sheetsas over 90 per cent of the equipmentused in solar power is imported.

Solar power producers were cer-tainly at fault for indulging in aggres-sive bidding. But the Central govern-ment, which has set the ambitious tar-get, made matters worse with its ex-cessive emphasis on lowering tariffs.In September 2018, the Ministry ofNew and Renewable Energy (MNRE)sent a note to Solar Energy Corpora-tion of India (SECI) - a non-profit com-pany under the MNRE, mandated topromote solar energy across the coun-try - instructing it not to allow solartariffs above a ceiling price of Rs 2.50

Solar Eclipse

Projects turning unviable amid asharp plunge in tariffs

Hardening interest rates,weakening rupee hurtingbalance sheets

More pain due to 25%Safeguard Duty on importedequipment

Government's cap on tariff atRs 2.50 per unit highlyunrealistic

Frequent cancelling of auctionsfor not offering lower tariffssending wrong signals toinvestors

Solar Energy InDoldrums

SOLAR POWER


per unit. "At a time when banks arenot forthcoming with debt and inter-est rates are being reworked, bring-ing in a cap on auction tariffs is cer-tainly not industry-friendly," stressesReNew Power Chairman and Manag-ing Director Sumant Sinha.

Just when the industry was reel-ing under severe stress came yet an-other disastrous measure from thegovernment. In its bid to promote lo-cal manufacturing of solar powerequipment under the Make In Indiainitiative, the government imposed a

25 per cent Safeguard Duty on im-ported solar panels and modules inJuly 2018. With over 90 per cent ofsolar power equipment imported fromChina and Malaysia, the tax - whichwill be gradually lowered and phasedout in three years - has made solarprojects in the country costlier.

The Central Electricity RegulatoryCommission has allowed a pass-through of the Safeguard Duty. How-ever, power distribution companies -the largest and most often the onlyclients of solar power producers -have been unwilling to shell out morefor solar power. In the past fewmonths, renewable energy agenciesof Maharashtra, Gujarat, Uttar Pradeshand Karnataka have frequently can-celled auctions after they have beenconducted and winners announcedbecause the winning tariffs have notbeen as low as expected.

"Approximately 4 gw (4,000 mw) ofsolar auctions have been cancelled bymultiple agencies in 2018. Investorshave become extremely concerned af-ter the retroactive cancellation of auc-tions, as the government agencies didnot accept the tariff levels," points outRaj Prabhu, the CEO of Mercom Capi-tal Group, a leading consulting firm.

Meanwhile, installed capacity of

rooftop solar power, targeted to con-tribute a mind-boggling 40,000 mw tothe 1,00,000-mw goal by 2022, stoodat a paltry 3,850 mw as of December2018. A transparent and consumer-friendly, feed-in-tariff for residentialconsumers will be a great way to spurgrowth in the rooftop solar powersegment, opine analysts.

Rays of hopeDespite bleak prospects in the shortterm, there is huge potential for solarpower in India, which is still heavilydependent on fossil fuel, like pollutingcoal, to fire up its power plants. It israther sad and ironical that the Uniongovernment is working at cross pur-poses when it comes to solar power.

On the one hand, the governmentis pushing hard to reach the ambitious2022 target. This can be achieved withgreat difficulty, of course, if India al-lows duty-free import of solar powerequipment. However, on the otherhand, the government has imposed a25 per cent Safeguard Duty to dis-courage imports and provide a fillipto local manufacturing of solar powerequipments, which is hardly in existence.

India will certainly need to createan enabling platform for domesticmanufacturing, along with favourablepolicies. However, it has to stop mi-cro-management of tariffs. This willonly end up in hurting the prospectsof the nascent solar energy industry."India needs to focus on strategies forthe long-term growth of the renewableenergy sector in addition to chasingambitious solar deployment targets,"opines Vikram Solar Chief FinancialOfficer Rajendra Kumar Parakh.

Meanwhile, even if India misses thebig target of 2022, it is certainly notthe end of the world for the solarpower Industry. Achieving even 50 or60 per cent of the mega 1,00,000-mwtarget is no mean feat by any means.The government must realise this fact.And at the same time, it should desistfrom pushing the industry to the cor-ner through ill-conceived policies.

"The Indian solarmarket isstruggling tosustain because ofpolicy andexecution

challenges. The slowdown isworrying for all stakeholders."

VINAY RUSTAGIMD, Bridge To India

"With low tariffs,there may be acompromise inquality of productsused in setting upof plants."

SANJEEV AGGARWALCEO, Amplus Energy

"At a time whenbanks are notforthcoming withdebt and interestrates are beingreworked, bringing

in a cap on auction tariffs iscertainly not industry-friendly."

SUMANT SINHACMD, ReNew Power

"Investors areconcerned after4,000 mw of solarauctions have beencancelled in 2018due to higher tariffs."

RAJ PRABHUCEO, Mercom Capital


PRITI RATHI GUPTA

Conventionally, India has al-ways been a savings-focusednation. Household savings

rate in the country was around 26 percent of the household income in 2016.A large chunk of this household sav-ings can be attributed to the lady ofthe household. Women in India havealways saved using traditional meth-ods, like using a basic savings ac-count, saving cash or using a recur-ring deposit at most.

With rise in nuclear families,wherein both men and women arebusy making ends meet, it is becom-ing crucial for women to take activeinterest in financial planning. Surpris-ingly, even though more and morewomen are joining the workforce to-day, looking at the need to shoulderequal responsibility with their partners

Finances For Her

Women can become even better managers of the futureby drawing up a robust financial plan and living by it.

for taking financial decisions for thefamily, they continue to be risk averseand hesitant in undertaking invest-ment decisions.

However, women who are lookingto start their entrepreneurial journeycan no longer afford to be ignorant orpassive in understanding their fi-nances. Looking into the future, oncewomen are able to break through thechallenges underlying their entrepre-neurial aspirations and begin to ac-quire the essentials of financial plan-ning, they can become even bettermanagers of the future.

Basic planningWhen women are starting their ownbusiness, the foremost step towardsfinancial planning is to understand

their net worth, their savings and theirinvestment potential. We may haveseveral different business ideas in ourmind; however, we must have a clearassessment of our financial positionbefore deciding to invest into any newventure or scheme.

As an entrepreneur, it is importantthat women separate their personalfinance and establish a dedicatedfund to finance new business. Hav-ing a separate fund allocated to thebusiness helps manage two primaryconcerns, which are firstly, tominimise personal liabilities by secur-ing your personal finance and for fam-ily members who may be dependenton you and secondly, when seekingfunding from external sources, it helps

PERSONAL FINANCE


your investors understand the seri-ousness and see your business asmore genuine and credible, having afocused approach.

The most fundamental aspect offinancial planning is that it helps anentrepreneur stay focused on one'sgoals and operate the business suc-cessfully. A well-detailed financialplan acts as a roadmap to guide youinto taking well-calculated decisionsand can enable women entrepreneursto identify the different sources avail-able for funding the business. Oncefunding is secured, the plan can helpentrepreneurs better prioritise theirfinancial resources and utilise themefficiently, while keeping timeframesin check to achieve the desired busi-ness targets. Therefore, financial plan-ning facilitates improved decision-making to answer questions, some-times precisely in yes and no, whileallowing other queries to get an-swered and make adjustments to thestrategy as and when required for thegrowth of the business. Furthermore,planning for finances is highly nec-essary to manage the cash flow of thebusiness. When an entrepreneur setsout a detailed business plan, itallows one to pre-empt the cash flowthat will be required to realise one'stargets. With an appropriate cashmanagement strategy, which iscustomised to their business needs,women can do much more with theresources in hand.

Bright futureFrom an investment point of view,starting out a business can seemdaunting when we analyse the num-bers and begin to calculate the pos-sible returns and the time it will taketo realise those returns. To assureminimal risk and profitable returns oninvestments, women entrepreneursmust know that the key is to have aclear understanding of the investmentopportunities available to them foroperating the business. Once we getan understanding about the pros andcons of the various investment op-

(The author is the MD of the Anand Rathi Groupand founder of LXME, a digital investment

platform for women.)

know where to invest and how much;manage and mitigate risks dependingon the appetite; understand re-invest-ment opportunities to minimise debt;and ultimately be ready to finance fu-ture growth and expansion plans withthe returns earned from the variousbusiness activities. Women must beprepared to seek the right advice interms of financial planning to makesure that there are no loose ends andthat it is doing the job it is meant todo for the business.

In fact, women can become evenbetter managers of the future oncethey are able to break through thechallenges underlying their entrepre-neurial aspirations and begin to ac-quire the essentials of financial plan-ning. To achieve this, they will needto start taking control of their financesand gain confidence in financialknowledge by referring to mobileapps, Web portals, news andspecialised publications to educatethemselves regularly. So, women en-trepreneurs as well as other women,start investing your savings into theright schemes for a bright future.

Enables women to realise allbusiness goals effectively

Helps them in analysingsources of funding required torun the business

Facilitates in deciding where toinvest and how much to invest

Guides in managing andmitigating risks, depending onthe appetite

Equips them to understandreinvestment opportunities tominimise debt

Ensures financing of expansionplans and assures future growth

portunities, by gaining complete in-formation on them, we can step aheadinto making systematic investmentsthat can ensure continual flow offunds to prepare for expansions andexigencies.

When we think of an idea for start-ing a business, we often end up bud-geting or start to count on personalsavings as we aim to work things outbased on our existing financial re-serve. However, when we think of in-vestments at the onset, we move astep ahead of budgeting by calculat-ing our financial needs rather thandepending on savings and risk ex-hausting them. Women entrepreneursmust therefore be actively engagedin understanding the importance offinancial planning and investing in theright place at the right time to securethe future and take complete controlof the business in their hands.

As entrepreneurs, women need torealise that in order to run any busi-ness independently, they must havecomplete understanding of their ex-isting and required financial healthand must plan for it thoroughly. Tosummarise, financial planning will en-able women to realise all businessgoals effectively; analyse sources offunding required to run the business;

Benefits Of Financial Planning


Ranjit Nair is passionate about artifi-cial intelligence, innovation andanalytics. The young and dynamic

CEO of Germin8 is precisely living his pas-sion. His Mumbai-based digital intelligencecompany focuses on using data analytics andartificial intelligence to help companies be-come more customer-centric. After a PhD inComputer Science with a specialisation in Ar-tificial Intelligence from the University ofSouthern California in 2004, Mr Nair workedas senior research scientist with HoneywellLabs in Minneapolis. He returned to India atthe end of 2006 and founded Germin8, alongwith his father, Raj Nair. In a friendly chatwith Sharmila Chand, Mr Nair speaks abouthis management principles and practices.

Your five management mantrasCommunicate your goals over and over:

Constantly communicate your goals withyour team, even if you think that they haveunderstood you already. This is because it isimportant for you and your team to be in syncat all times. Often, you or your team will facedecisions that may be at cross purposes toyour goals. Having stated these goals oftenwill be very clarifying and will help both youand your team act as of one mind in accor-dance with your goals.

Trust your team to deliver: Trust yourteam to execute their plans withoutmicromanaging. One should go over plans indetail and act as a sounding board for yourteam, but don't micromanage the executiononce you have delegated the task to some-one else. This does not mean that oneshouldn't measure the progress of the taskand ensure that targets are met.

Don't compromise on your values: Be firmand uncompromising with your values. Therespect that you earn will be more than payback any short-term benefit that you may gainby compromising. Employees, customers,partners and investors will trust you, and theensuing goodwill is immeasurable. Andabove all else, you will sleep better at night.

Choose whom you work with carefully:

Don't Pack A Parachute

"You need tokeep yourselfhealthy in bothbody andmind. Thismeans thatyour lifecannot be onlyabout work.Spend qualitytime with yourfamily andquality timewith yourself."

When one is choosing whom one works with,we should pick people we respect, we canlearn from and whom we can trust. We shouldbe careful of picking people who merelycheck boxes for technical competence andknowledge.

Think long term, plan medium term andexecute daily: The world is so dynamic. Thereare so many external factors that we cannotcontrol and sometimes even predict. Thatsaid, we have to be thinking long term be-cause this will help us ward off threats andalso see opportunities before our competi-tion. Our plans need to be for the mediumterms. When it comes to execution, we shouldbe executing daily according to plan,

A game that helps your careerI enjoy running long distance. Apart from thejoy of running that only a fellow runner canattest to, running long distance is a test ofendurance and will power. It teaches us toplan a long run by breaking it into shortermilestones and to not give up even when thegoal is far away. Apart from all this, runningis when I can switch off completely from ex-ternal stimuli and focus just on my breathand thoughts. I have found it to be a sourceof many breakthrough ideas.

Turning point in your lifeThe turning point in my life was probablywhen a customer paid for our product for thevery first time. Suddenly, what we were do-ing became serious and no longer a game.The transaction represented trust that a cus-tomer had placed in us and made us account-able to deliver. It showed us that what wehad been building and striving for was actu-ally valued by a customer. It gave meconfidence that we could take that smallwin and translate it into acquiring many morecustomers.Your philosophy of workMy philosophy is simple. We have just onelife and spend the majority of our wakinghours at work, so let's have fun while doingit. This means working on problems that aremeaningful and challenging, working with

RANJIT NAIR, CEO, Germin8

MANAGEMENT MANTRA


You cannot be saddled by the fear of failure.This means that when you set out to achievea goal, you don't plan for failure. Yes, youmay fail, but if you only do things that aresafe, you will definitely not succeed.

Say no early: There are infinite opportu-nities and only a finite number of hours in theday. You need to be very focused in terms ofwhere you will expend energy. If there is acertain direction that you are being pulled,and if you are sure that it won't be a meaning-ful utilisation of your time, you should stopdoing it at once. It is best to treat it as a sunkcost rather than invest more in that directionjust because you have started.

Life is a marathon and not a sprint: Andjust like a long race, while you race andachieve each milestone, you need to paceyourself well. You need to keep yourselfhealthy in both body and mind. This meansthat your life cannot be only about work.Spend quality time with your family and qual-ity time with yourself.

colleagues whose company we enjoy in anenvironment that is fun and working for cus-tomers who love us.

A person you admireI admire many and have been influenced byseveral of them, but one person who standsout is Narayana Murthy (Chairman Emeritusof Infosys). I met Mr Murthy only once andthat too for just a few minutes at an eventwhere he was the chief guest. I was just 22 atthe time and about to head to the US for myfurther studies. I honestly don't rememberwhat I asked him, but it was probably aboutsomething about his journey as an entrepre-neur. But I do remember being touched that asuccessful entrepreneur would talk so casu-ally and openly to a student. Mr Murthy in-spired me, and, I am sure, countless others tobe an entrepreneur with strong values.

Your favourite booksMy favourite books are science fiction byauthors, like Isaac Asimov, Arthur C Clarke,Jules Verne, H G Wells, Douglas Adams andIain Banks. Their books are a testimony tothe kind of creative thinking that is possiblewhen one imagines the future without beingburdened by imagined constraints of time,money and sometimes even physics.

Your five business mantrasNever dismiss an idea out of hand with-

out considering it first: At first hearing, itmay sound like something you have thoughtof before and already discarded, or it may goagainst what you believe to be true. It is veryeasy to trash an idea that is presented to youbecause an idea in its infancy is full of weak-nesses. Instead try to find merits in the idea.Ask yourself how you would build on it, howyou would overcome its weaknesses, howyou could scale it up. You never know wherethe next breakthrough idea will come from. Itjust needs nurturing.

Know your own weaknesses, biases andblind spots: As a leader, it is important thatyou know and understand your own limita-tions. There may be gaps in your own abili-ties, knowledge and skills that are limiting thegrowth of your firm. Knowing this will helpyou overcome these either by correctingyourself or by finding others who comple-ment you.

Don't pack a parachute: As an entrepre-neur, you need to be perpetually optimistic.

"Trust your team to execute their planswithout micromanaging. One should go overplans in detail and act as a sounding boardfor your team, but don't micromanage theexecution once you have delegated the

task to someone else."


GLOBAL WRAP-UP


for voters. Economic outputcontracted by 2.4 per cent inthe final three months of2018 compared to the thirdquarter on a seasonally andcalendar-adjusted basis, theTurkish Statistics Institutehas said. That followed arevised 1.6 per cent contrac-tion in the third quarter.Inflation has also remainedhigh. It struck a 15-year peakin October at 25.24 per centbefore falling below 20percent in February.

US set to be netexporter of oilCrude oil production is set tocontinue expanding in the USthanks to shale oil. The USwill become a net exporter ofoil from 2021, a developmentwhich should reinforce globalenergy security, the (Interna-tional Energy Agency) IEAhas said. New technologythat allows for extracting oiland gas from shale rockformations has led to a boomin oil production in the US inrecent years. With lowproduction costs, that boomis set to continue. The IEAforecasts that the US willaccount for two-thirds of theincrease in global oilproduction and some three-quarters of the expansion ofLNG over the next five years.

Renault, Nissanrestructure allianceJapan's Nissan Motor andFrance's Renault have saidthat they will retool theworld's top car-makingalliance to put themselves onmore equal footing, breakingup the all-powerful chair-manship previously wieldedby ousted boss CarlosGhosn. The removal ofMr Ghosn had causeduncertainty about the futureof the alliance and somespeculation that the partner-ship could even unravel. Thecompanies, together withjunior ally Mitsubishi

No end to Apple,Qualcomm patent warSplit decisions by a USgovernment panel inacrimonious patent disputesbetween iPhone-maker Appleand chip-supplier Qualcommlast month left their battlelines largely unchanged aheadof a US Federal TradeCommission ruling and amajor trial next month. TheInternational Trade Commis-sion (ITC), a governmentagency empowered to heardisputes over patentedtechnology, issued a finalruling in one case that wentin Apple's favour, while anITC administrative judgemade a non-binding recom-mendation that supportedQualcomm in another. Thetwo American companieshave been locked for twoyears in a legal dispute overpatents.

China plans to cutVAT rate by 3%China is planning to cut theValue-Added Tax (VAT) ratethat covers the manufacturingsector by 3 per cent. Thereduction is a part ofmeasures planned to supportthe slowing Chineseeconomy. A 3 per cent cut toVAT could deliver a boostworth up to 600 billion yuanor 0.6 per cent of ChineseGDP, according to estimatesby Morgan Stanley. Themove helps corporate profitsat a time when the economyis facing pressure from the UStrade standoff and the impactof a domestic debt cleanup.

Turkey in recessionas poll loomsTurkey's economy fell intoits first recession in a decade,official data showed lastmonth. The recession comesjust weeks before PresidentRecep Tayyip Erdogan'sgovernment faces localelections where growth andinflation will be key issues

Amnesty International flays EV industryAmnesty Inter-national has at-tacked the elec-tric vehicle (EV)industry for sell-ing itself as envi-r o n m e n t a l l yfriendly, whileproducing many

of its batteries using polluting fossil fuels and unethically-sourced minerals. Production of lithium-ion batteries forEVs is power intensive, and factories are concentrated inChina, South Korea and Japan, where power generation islargely dependent on coal or other fossil fuels, Amnestyhas said. Manufacturing batteries can be carbon intensive,while the extraction of minerals used in them has been linkedto human rights violations, such as child labour, a state-ment from the rights group has said.

Setback for Bayer in Roundup trialA US jury lastmonth awarded $80million to a manwho claimed thathis use of Bayer'sglyphosate-basedweed killerRoundup had

caused his cancer. This is the latest legal setback for thecompany, which is facing thousands of similar lawsuits.The jury in San Francisco federal court said the companywas liable for plaintiff Edwin Hardeman's non-Hodgkin'slymphoma. Bayer had bought Roundup-maker Monsantolast year for $63 billion. In a statement, Bayer said that itwas disappointed with the jury's decision and added that itwould appeal against the verdict.

Cathay to buy Hong Kong ExpressCathay Pacific willbuy low-cost car-rier Hong Kong Ex-press for $4.93 bil-lion. The purchasewill be made in cashand through prom-issory loan notes,

the company has said in a stock filing. Hong Kong Express,which flies to destinations across Asia, will become awholly-owned subsidiary of Cathay Pacific. Cathay Pa-cific has been overhauling its business to cut costs andreturned to profit. Cathay Pacific intends to continue oper-ating Hong Kong Express as a stand-alone airline using thelow-cost carrier business model. The transaction is expectedto be completed by the end of the year.


Motors, have said that thechairman of Renault wouldserve as the head of thealliance but not as chairmanof Nissan.

May's Brexit dealrejected again

the worst impacts of globalwarming, experts have saidthat there is little hope ofmeeting that goal without an"urgent and systemictransformation" in how weuse the earth's resources.

EU adds 10 countriesto tax blacklistThe European Union (EU)has expanded its tax havenblacklist by 10 countries,adding the United ArabEmirates (UAE) andBermuda despite theobjections of powerfulmember states such as Italy.The list, now 15 countrieslong, was first drawn up in2017 in the wake of severalscandals, including thePanama Papers andLuxLeaks, which pushed theEU into doing more to fighttax evasion by multinationalsand the rich. Seven countriesare to be moved back from agrey list because reformcommitments have not beenmet. These are Aruba, Belize,Bermuda, Fiji, Oman,Vanuatu and Dominica.

Japan's growthslowing downJapan's factory outputexpanded for the first time infour months in February.However, the rebound wasrelatively weak, and theoverall outlook for the sectorand businesses suggested thata record post-war economicgrowth phase may be comingto an end. The rising pressureon the economy was furtherunderlined by a weakoutcome for retail sales,meaning that Japan'srecovery is showing signs offalling prey to both slacken-ing domestic and externaldemand. Data by theMinistry of Economy, Tradeand Industry showed thatfactory output rose by 1.4per cent. However, it barelyrecouped a revised 3.4 percent slump seen in January.

Fake, pirated goods 3.3% of global trade

Global sales ofcounterfeit and pi-rated goods havesoared to $522 bil-lion a year, amount-ing to a whopping3.3 per cent ofworld trade, accord-ing to a report pub-lished recently. The latest assessment by the EU Intellec-tual Property Office (EUIPO) and the OECD has foundthat the share of counterfeit goods has seen a "consider-able" rise since its previous 2016 estimate of 2.5 per cent ofglobal trade. Such goods represented 121 billion euros worthof imports into the European Union alone - a massive 6.8per cent of total imports into the bloc.

KFC China on expansion spreeAmerican fast foodchain KFC's ownerin China is pushingahead with expan-sion plans, openingtwo stores a day inthe world's biggestconsumer market.It is banking on technology to cut costs, even as car-makersand industrial companies signal deteriorating demand. YumChina Holdings, the nation's biggest fast-food chain, whichoperates the KFC and Pizza Hut brands, sees potential forover 11,000 more outlets. Chinese KFCs take payment byfacial recognition and ice cream is served by robotic arms.Yum's use of technology to target tech-savvy customers,mainly in top-tier cities, is a strategy to lure business in themore mature markets.

Tesla raises prices of e-cars by 3%Elon Musk is back-tracking from a jar-ring change inTesla's retailingstrategy, which iskeeping many ofthe company'sstores open andraising prices of its electric cars as a result. Tesla will in-crease the cost of its EVs by an average of about 3 per centafter re-considering a plan announced just 10 days earlier towind down most of its physical stores. In a blog post, thecompany has said that about half the locations it wasplanning to close will now stay open. Mr Muskblindsided many sales personnel at the company with thestore closings.

Lawmakers rejected UKPrime Minister TheresaMay's Brexit deal for thethird time late last month.The rejection has sounded aprobable death knell of theBrexit deal and put Britain'swithdrawal from the EU inturmoil on the very day itwas supposed to leave thebloc. The decision to reject astripped-down version ofMs May's divorce deal hasleft it totally unclear how,when or even whether Britainwill leave the EU and plungesthe three-year Brexit crisis toa deeper level of uncertainty.European Council Presidentand summit chair DonaldTusk has said that EUleaders will meet on April 10to discuss Britain's departurefrom the bloc.

'Raw materials behindhalf of emission'Extracting and processingmaterials, fuel and foodcontributes as much as halfof the world's greenhouse gasemissions, the UN has said.Using dozens of datasources, the authors of amajor new report havepresented lawmakers andbusinesses with a starkchoice: drastically reform theglobal economy to get morefrom less or risk the collapseof global infrastructure. Withcountries already committedunder the Paris climate dealto curb emissions to fend off

READERS' LOUNGE


Big Brother's WatchingThis new book lays bare the threats to humanity posed by a spying digital future.

This book deals with the challenges to humanityposed by the digital future. It is one of the firstdetailed examinations of the unprecedented form of

power called surveillancecapitalism and the quest bypowerful corporations to pre-dict and control ourbehaviour.

In this masterwork of origi-nal thinking and research,author Shoshana Zuboff pro-vides startling insights intothe phenomenon that shehas named surveillance capi-talism. The stakes could notbe higher: a global architec-ture of behaviour modificationthreatens human nature inthe 21st century just as in-dustrial capitalism disfigured

the natural world in the 20th.Ms Zuboff vividly brings to life the consequences as

surveillance capitalism advances from Silicon Valley intoevery economic sector. Vast wealth and power are accu-mulated in ominous new "behavioural futures markets",where predictions about our behaviour are bought and

AuthorSHOSHANA ZUBOFF

PublisherPUBLICAFFAIRS

Pages: 705

Price: Rs 2,207

THE AGE OFSURVEILLANCECAPITALISM

Although India's economy is growing at a steadyclip of over 7 per cent a year, job creation is far

short of where it needs to be. At the same time, mostIndians who are employed are stuck in jobs that don'tpay well. Hidden in this tangle is not just a crisis ofproductivity and skills but also a lack of employmentopportunities for the country's teeming millions, writesauthor Goutam Das.

If the issues miring both demand and supply in thejob market are not addressed urgently, we are looking atan economy in which over 20 crore people will be in"bad jobs" or even without jobs by 2025. Why are In-dian companies not creating enough jobs? Why do smallcompanies remain small? Will bots take over today'sjobs, from the shop floor to the back office? What will

Vanishing Jobs

AuthorGOUTAM DAS

PublisherHACHETTE INDIA

Pages: 320

Price: Rs 599

JOBONOMICS

sold, and the production of goods and services is subor-dinated to a new "means of behavioural modification".

The threat has shifted from a totalitarian Big BrotherState to a ubiquitous digital architecture: A "Big Other"operating in the interests of surveillance capital. Here isthe crucible of an unprecedented form of power, markedby extreme concentrations of knowledge and free fromdemocratic oversight.

Combining indepth technical understanding and abroad, humanistic scope, Ms Zuboff has written what mayprove to be the first definitive account of the economic -and thus social and political - condition of our age.Ms Zuboff is no stranger to this territory. In her 1988 book,In the Age of the Smart Machine, she had addressed atthe moment of their appearance in the business world manyof the issues that have come to achieve dominance in oureveryday life. Embedded within a large pharmaceuticalcompany in the 1980s, she observed first hand how newtools for internal communication, first welcomed by em-ployees as novel social spaces in which they could betterconverse, plan and access information, were graduallyrecognised as tools for management intrusion and con-trol. Aspects of employees' personal experience that wereimplicit and private suddenly became explicit and public,were exposed to scrutiny and made the basis for evalua-tion, criticism and punishment. Now it is the interiors of all

salaries of the future look like? Why have successive gov-ernments failed in their promises to create more jobs thatpay well?

The author at the outsetmentions that while there couldbe high unemployment in thecountry, there is no "job crisis"as such, even if there could bea "wage crisis". The book isnot about a current job crisis,but about an emerging one. Itlists historic reasons, like laws,which can anytime come backand bite you. Then there aresignificant productivity gainsin the industry, causing theneed for fewer jobs

Mr Das explores these is-


About the authorShoshana Zuboff is the Charles Edward Wilson Professoremerita of Harvard Business School. She is the author of Inthe Age of the Smart Machine and The Support Economy.She received her PhD from Harvard University and her BAfrom the University of Chicago.

our lives that are exposed to invisible overseers, who donot merely profit from our actions, but increasingly con-trol their every expression.

The author meticulously demonstrates how Google,initially a financially-struggling search engine, pioneeredsurveillance capitalism once it discovered that it was sit-ting on a data gold mine - its users - and could monetisethe personal information disclosed by every search. Notthat we ever consented. And therein lies the system's foun-dation, the prime deception that fuels Ms Zuboff's slow,focused burn. As if someone walked into your home,glanced around and claimed it all as theirs, surveillancecapitalism takes what it wants, makes you pay andlooks for new strategies to get even more. Google is sur-veillance capitalism's chief architect. Its initial successwith targeted ads swiftly prompted a longing for data atscale, the better to define and target us at an ever-more-granular level.

Ms Zuboff's comprehensive and moving analysis laysbare the threats to 21st century society: A controlled "hive"of total connection that seduces with promises of totalcertainty for maximum profit - at the expense of democ-racy, freedom and our human future. With little resistancefrom law or society, surveillance capitalism is on the vergeof dominating the social order and shaping the digital fu-ture - if we let it.

Aadhaar, India's unique identity system, was intro-duced in 2009 with the stated purpose of creating

a more inclusive and efficient welfare system. Hundredsof millions of Indians were enrolled into the biometricdatabase, with successivegovernments creating pres-sure by making it compul-sory for social benefits. Evenafter the Supreme Court ver-dict in 2018, it remains amust-have for welfare.

This book argues thatAadhaar was never reallyabout welfare. The essays inthis book explain how theproject opens the doors toimmense opportunities forgovernment surveillanceand commercial data-mining.Focusing on Aadhaar, butdrawing lessons from IDprojects from other parts of the world also, this bookalerts readers to the dangers lurking in such expansivedigital ID projects.

For example, how profiling, made possible byAadhaar, impinges on the fundamental right to privacy;or how surveillance leads to self-censorship and canchoke free thought and expression; or how Aadhaar,contrary to government claims, excluded people entitledby right from welfare when made compulsory.

On the technology side, what are the perils of usingbiometrics and the dangers arising from centralised da-tabases? Who has access to all our data, and how canit be used against us? With contributions from econo-mists, lawyers, technolo-gists, journalists and civilliberties campaigners, thisbook is for everyone con-cerned about a healthy de-mocracy in India and be-yond. It will also be of in-terest to students andscholars of political sci-ence, law and public policy.

Bane, Not Boon

AuthorREETIKA KHERA

PublisherORIENT BLACKSWAN

Pages: 288

Price: Rs 475

DISSENT ON AADHAAR

About the authorReetika Khera is associate professor of Economics andPublic Systems at the Indian Institute of Management,Ahmedabad.

About the authorGoutam Das is a senior editor at the Business Today. Inover 17 years as a journalist, he has worked withpublications, such as Financial Express, DeccanChronicle, Hindustan Times, The New Indian Expressand Dataquest. Mr Das has won several awards forhis reportage on employment, skills and man-machineconflicts.

sues and more in this engaging narrative that docu-ments the real stories of workers of all shades acrossIndia, from Tiruppur in Tamil Nadu to Gurugram inHaryana, highlighting the social and political conse-quences of unemployment and underemployment. Pre-

senting astute analyses of the current andfuture trends in India's job market, thistimely book points to the path forward andunderlines the human potential that we cantap into to turn the tide.

CANCER

STAR TALK

ARIES Mar 21-Apr 20

Your health and fitness would stay in shapethis month. Your willpower would be strongduring this period, and you may work with fullconcentration. You may enjoy your work, but

it's advisable for you to maintain good relationships withyour colleagues. For your business, this month may proveamazing; your clients or customers would increase. Youmay face unexpected expenses. You may feel like buyingland, house, or property, but your desires may not getfulfilled during this month.

Jun 22-Jul 22

For your physical and mental health, the first19 days of this month may prove great,whereas you may require being cautious dur-ing the rest of the days. Your productivity may

increase, and you may get progress and success in yourwork. For employees, the first ten days of April may proveamazing, though the later days may not be that excellent.Businessmen may find the period till April 16 in their favour.For your financials, this month may prove average. Yourincome may increase till April 19, and after that, you mayfind some reduction in it, cautions Ganesha.

Your health may support you this month, butyou should take care of your health after the20th of April. For your businesses, this monthmay be very positive; your luck would be in

your favour. If you are into industrial sectors related tochemicals, education, etc, you may witness April as a re-ally great month. For other sector businesses, this monthmay give you average results, and you would have towork hard indeed. It's advisable for you not to travel dur-ing this month and avoid doing important work.

TAURUS Apr 21-May 21

This month is going to be action packed foryou. Your energy levels will be at an all-timehigh. However, your health may see a few upsand downs. Work-wise, things may be a little

shaky this month. You will have to work cohesively withyour colleagues. Matters related to money need to behandled with utmost care and investments made in thestock market must be carefully examined. As for makinginvestments, it would help you to be cautious while buy-ing a property.

May 22-Jun 21GEMINI

For employees and businessmen, this monthmay give mixed results in their jobs and busi-nesses. Your income may increase during thefirst 16 days of April. You would plan on how

to increase your income. Your family's financial needs mayincrease, and you would have to be active for planningyour finances really well. There are chances of some fi-nancial issues during the second half of this month. Stu-dents may feel interested in their studies during the firstten days of April and also get success. The later days ofthis month may not favour students that much.

LEO Jul 23-Aug 23

Aug 24-Sep 23

The beginning of this month may be a littleslower for your professional life. But it mayget better with each passing day, and you willget many prominent opportunities. Your com-

petitors may also get inspired by you and may follow yourpath as well. You should be cautious during the last weekof this month. It's advisable for you not to trust anybodyblindly for finance-related matters. During the first, sec-ond and fourth weeks, your income may increase, andyou would be able to satisfy your family's needs.

VIRGO

This month will prove to be full of ups anddowns. You may have to take care of yourpersonal and professional relationships andhave to be cautious to avoid any issues. It's

advisable for you not to get manipulated by any otherperson and take work-related decisions only afteranalysing your situation and requirements, along with thecurrent market condition. This month may prove great foryour job and business. If you have any business relatedto real estate, the pace of progress will be a little slower,whereas for the business of printing or paper, this timemay prove amazing.

LIBRA Sep 24-Oct 23

This month may prove mixed for you. You mayhave to be cautious about your health. Theyounger generation may require being carefulnot to get into any accidents. Aged people

may also have to take additional care of their health, espe-cially for the first two weeks. This month may prove amaz-ing for your financial matters. Your work or business mayreach new heights, and you may get rewards for your ef-forts. Your routine may really be well during April. Youmay feel a little lethargic after April 20. Employees mayget progress, and even businesses may flourish duringthis month.

SCORPIO Oct 24-Nov 22



Warren Buffett is an Americanbusiness magnate, investor,

speaker and philanthropist, whoserves as chairman and CEO ofBerkshire Hathaway. His companyowns more than 60 companies, in-cluding insurer GEICO, battery-maker Duracell and restaurant chainDairy Queen.

Known as the Oracle of Omaha,Mr Buffett is one of the most suc-cessful investors of all times andhad a net worth of $82.5 billion asof March 2019. He was ranked num-ber three in the Forbes Ranking ofBillionaires in 2019. Mr Buffetthas promised to give away over 99per cent of his fortune to philan-thropy. Ganesha analysesMr Buffett's horoscope to see whatis in store for one of the world'swealthiest persons.

Saturn will propel Warren Buffett tore-evaluate his business strategies.

Despite Hurdles, Buffett's Riches Will Remain Intact

For Sagittarius, this month may give mixedresults. You may get great success in a fewfields of your life, whereas there would be upsand downs in others. You would have to take

care of your health during the third and the fourth weeksof this month. Employees and businessmen have to becareful not to take any wrong decisions. If you succeed indoing so, your professional life would be smooth for therest of the month. The first week may prove negative forinvestors, though the second and the third weeks mayprovide exceptional results, adds Ganesha.

SAGITTARIUS Nov 23-Dec 21

CAPRICORN Dec 22-Jan 20

For your career and business, you may getsuccess during the first 16 days of this month,whereas you may face some issues during thelatter days. You would not need to worry

about your finances at the beginning and end of this month.Your regular income resources may fulfil all your needs,though you may have some financial tightness during thefourth week as a result of your investment activities. Youmay feel anxiety and stress during the second and fourthweeks of April. As a result, your behaviour with your fam-ily may get rude, cautions Ganesha.

You may not have to face any major issuesduring this month. You may get accidental,monetary benefits. You may also get thechances of a foreign trip. Your financial con-

dition would improve during this period. For students,this month may be a little tough. Students in higher educa-tion may feel distracted due to their relationship. It's ad-visable for you to be sincere to your career. You may facesome issues related to your family. Employees may wit-ness progress in their job, and their reputation would alsoimprove. You may get support from your mentors.

AQUARIUS Jan 21-Feb 18

The month of April may give mixed results foryour mental and physical health. Your healthmay support you during the first ten days ofthis month, whereas the later days would be

filled with ups and downs. For your business and career,the first 19 days may prove amazing, and you may getsuccess as well. As a result of your hard work, during thefirst and the last ten days of April, your income inflowwould increase, but you may require controlling your ex-penses during the rest of the days. Avoid property trans-actions during the later parts of this month.

PISCES Feb 19-Mar 20

Astro analysisIn Mr Buffett's horoscope, transitingSaturn and Ketu are moving over Sat-urn in the ascendant. Transiting Jupi-ter is moving over Moon in the 12thhouse of the chart. Besides, he is un-der the influence of Rahu's major pe-riod and the sub-period of Moon.

Moon is forming Vipreet Raj Yog,which will help Mr Buffett retain hisposition in the list of the world'ssuper-rich people. However, his for-tune will slip between May andAugust 2019. There will be some is-sues which may make him feel bad.But under Saturn's influence, he willact strongly to meet the challengesand defeat them.

Besides, Saturn will propel himto re-evaluate his business strate-gies so that he can sort out the weakpoints and pursue his business withadded vigour and enthusiasm. Butthere may be some problems be-tween mid-November 2019 and Feb-ruary 2020. Nevertheless, the ben-efic Jupiter in the ascendant willmake him regain his confidence.From mid-February 2020, he will wit-ness positive developments.

KNOWLEDGE ZONE

Early in February, a merger deal in-volving Germany's Siemens and

France's Alstom received a big set-back. The proposed amalgamation ofthe European engineering companieswould have created a huge corpora-tion for manufacturing trains. But thedeal could not materialise, thanks toMargrethe Vestager, the EuropeanUnion's (EU) no-nonsense Competi-tion Commissioner.

The move dismayed German Chan-cellor Angela Merkel and French Presi-dent Emmanuel Macron, who had ar-gued that Europe needed large cor-porations to take on global giants. ButMs Vestager (pronounced Ves-taya)was not the one to buy that argument.The 50-year-old politician from Den-mark had ruled that the merger wouldeliminate competition in certain sec-tors, especially in signalling systems.

Alstom and Siemens have, in fact,joined a long list of major global cor-porations to have earned the wrath ofthe EU competition commissioner.Google, Apple, Amazon, Starbucks,Ikea, Qualcomm and Gazprom, among

Unfazed by criticisms, Ms Vestagerhas been doing her job rather sin-cerely. Since taking over as the EUCompetition Commissioner in 2014,she has forced US technology giantApple to cough up 14 billion eurosafter ruling that Ireland had given itillegal tax breaks. She has hauled upGoogle for abusing its market domi-nance and slapped a penalty of 6.7billion euros on the internet searchengine. She has also taken on Russia'sState-owned energy giant Gazprom forabusing its position in gas markets."The motives that are breaching com-petition law are as old as Adam andEve. It's about greed and fear, andwhen you combine them with power,you get a very poisonous cocktail,"she has often stressed.

Brought up in a bustling Lutheranparsonage in a coastal town of Den-mark, Ms Vestager is known in Brus-sels (Belgian capital which houses theheadquarters and other top institu-tions of the EU) for her straight man-ner and dry humour. Back home inDenmark too, she had earned the

others have been targeted over thepast few years allegedly for either try-ing to eliminate competition or forgaining from unfair tax concessions.Her tough decisions have even irkedUS President Donald Trump, who hadcalled her the "tax lady" in the past.

F A C T SF O R Y O U

NATIONAL ANTI-PROFITEERING AUTHORITY

There has been a deluge of finesslapped by the National Anti-

Profiteering Authority (NAA) on In-dia Inc in the pat one year. The NAA,the anti-profiteering watchdog of theGoods and Services Tax (GST), haspenalised consumer goods-makerHindustan Unilever (HUL) with aRs 462-crore fine for allegedly profi-teering to the extent of Rs 383 croreafter the large-scale GST rate cut inNovember last year. HUL has broughta stay on the penalty from the DelhiHigh Court.

The NAA has imposed a fine ofRs 10.79 lakh on Cloudtail India, ajoint venture between Amazon.com

goes on and on. It has been a hecticstart for the NAA since it began op-eration in November 2017. The NAA'score function is to ensure that thebenefits of reduction in GST rates ongoods and services made by GSTCouncil are passed on to consumers.

The NAA is headed by the chair-man - Badri Narain Sharma isauthority's first and currently-servingchairman - and has four technicalmembers. It is assisted by a StandingCommittee at the national level, aScreening Committee in every Stateand the Directorate General of Safe-guards in the Central Board of Excise& Customs.

Formation of the NAA comes inthe background of rate reduction of alarge number of items by the GSTCouncil at many of its meetings sincethe new tax regime came into force inJuly 2017. Several rounds of GST cuts

and N R Narayana Murthy's familyoffice Catamaran Ventures, for allegedprofiteering from sale of printing car-tridges after the GST was cut from 28to 18 per cent last year.

The list of companies and fines

Recent penalties on companies bythe NAA have rattled the industry.

AT THE HELM


MARGRETHE VESTAGER

Adjustment WithDisagreeable People

The bog of gutters near Bandra Station(in Mumbai) smells foul, but does that

mean you should scold it? In the sameway, these people 'smell foul', so can youtell them anything? Everything that smellsfoul is considered a creek, and that whichgives off fragrance is considered a garden.Everything that smells foul says, 'Remainvitaraag with us!' It is because of labellingthings as good or bad that they [theopinions] harass you. You have to makeboth of them equal. When you refer to thisas 'good', the other (automatically)becomes bad, and that is why it harassesyou. But if you mix both together, the effectthen no longer remains. 'Adjusteverywhere' is something 'we' havediscovered. Adjust with the one who isspeaking truthfully as well as with the onewho is telling a lie. If someone were tosay to 'us', "You have no sense," thenI would immediately adjust and tell him,"I never had any to begin with! Why haveyou come looking for it now? You justhappened to discover this today, whereasI have known this since childhood." If yousay this, then the problem ends, doesn't it? Thereafter, he will certainlynot come to you looking for sense. If you do not do this, then whenwill you reach 'your home' (liberation)?

Adjustment With The WifeQuestioner: Please explain how one should adjust.Dadashri: Suppose that, for some reason, you are late cominghome, and your wife starts to say offensive things, wrong thingssuch as: "You come home so late. I will not put up with this, that andthe other...." If she has lost her temper, then you should say, "Yes,you are right. If you tell me to, I'll go back. Otherwise, if you tell meto sit, I'll sit inside." She will respond, "No, don't go back, just bequiet and go to sleep." Then tell her, "If you tell me to, I'll eat dinner,otherwise I'll go to sleep," to which she will reply, "No, have yourdinner." So, you should give in to her and eat. This way, you haveadjusted. Therefore, in the morning, she will serve you a first-classcup of tea. However, if you were to scream and shout at her, thenshe would bang your teacup on the table, and the quarrel wouldcontinue for the next three days.

Adjustment During MealtimesDadashri: One is considered as having (ideal) worldly interactionswhen he adjusts everywhere! The time has now come fordevelopment. So, do not have divisiveness due to difference ofopinion. That is the reason I have given people the phrase, 'AdjustEverywhere!' Adjust! Adjust! Adjust! If the yogurt soup turns out tobe salty, then understand that Dada has said to make an adjustment;so go ahead and drink a little bit of the yogurt soup. Yes, and if youhappen to desire a bit of pickle, then go ahead and say, "Bring somepickle." But do not quarrel. There should be no quarrelling at home.If at times, one is placed in difficulty, and if he makes an adjustmenthimself, then worldly life will become beautiful.

Spiritual Corner Adjust Everywhere

For more information on Dadashri's spiritual science,log on to www.dadabhagwan.org. Also visit kids.dadabhagwan.org


reputation for being tough and verydecisive. As a leader of the centristSocial Liberals (Radikale Venstre)party, she had played a big role inchallenging the status quo at home.

While still in opposition, she hadpushed the ruling coalition to cut anearly retirement programme and raisethe retirement age from 60 to 65 inearly 2011. Danes had hated it at thattime, but that major reform did her noharm. In reality, her party's fortunessoared, and Ms Vestager became anational hero. Beneath that tough ex-terior though, Ms Vestager has beena very normal home-maker, who lovedto knit and bake bread.

The past five years have beenquite challenging for Ms Vestager, andthe EU competition commissioner hasfaced them with unwavering grit.Meanwhile, election for the presidentof the European Commission isaround the corner in the next fewmonths. And Ms Vestager is now be-ing talked about as a serious con-tender for the presidency polls.

To be continued…

PUJYA DADASHRI

will benefit consumers only if tradersmake quick reduction of prices of re-spective items. This is where the NAAcomes into picture to ensure that trad-ers are not realising unfair profit bycharging high price from consumersin the name of GST.

The recent penalties on companiesby the NAA have rattled the indus-try. Tax experts note that industriesfollow divergent practices, with someensuring passing on of tax benefits atentity level. However, the NAA hasbeen computing the tax benefits ateach stock-keeping unit (SKU) leveland at respective customer level. Thisdifference of calculating tax benefitsis leading to a rush of complaints andfollowed by penalties. These are earlytimes. With a passage of time, the in-dustry and the authority may perhapscome to terms in relation to what con-stitutes profiteering.

COMPILED BYDR NIRU MAA

HOT SEAT

Send feedback to [email protected]


How you define yourself?Ambitious, focused, perfect, intelligentand good observer

What is your philosophy of life?Hard work pays you. Work hard, andyou will succeed. I believe that hardwork is the key to success.

What is your passion in life?To shine in my profession of hospitalityand to achieve the best

What is your management mantra?Be firm and focused. Stand up withemployees emotionally, financially.Try to explain them whenever required.Later you should be strict.

A business leader you admirethe most…Rajeev Bajaj from Bajaj Auto andMrs Suri from Lalit Hotel

Your strength…Support from my family and staff

Your weakness…I am a workaholic, and I expectperfection from everyone.

Your favourite cuisine…Chinese

Your stability factor…Concentrate only on one line ofprofession.

What upsets you easily?After explaining properly, if the work isnot done as per my expectation

Your kind of music…Old Hindi movie songs

Your favourite holiday destination…Switzerland

Golf or Bridge or…I am not a player. I like watchingmovies.

Formal suit or casual attire…Business casuals everyday orsometimes suits

You are a tough, serious boss or…I am balanced in between, but I wantmy work to be done in time.

How do you distress?Seeing my grandchildren's video

Your fitness regime…One-hour walk seven days a week andyoga for half-an-hour

Ten year from now, where do wesee you?Working part time and enjoying thecompany of my grandchildren

Meena S. Jain swears by focus and concentration to succeed in life as well as business. The dynamic director of Pride Hotels with a nimble business sense has been playing a pivotal role in

steering the hospitality company to greater heights. The Mumbai-basedluxury hotel chain having pan India presence, which opened its first prop-erty - a 100-room hotel - in Pune's Shivaji Nagar three decades ago in1988, has spread to 15 cities across the country with more than 2,000rooms. And Ms Jain, who has been around in the hospitality industry forover 25 years, has overseen the most part of Pride's exciting journey. Inan engaging conversation with IBJ, Ms Jain talks about her strengths,weaknesses, likes and dislikes.

MEENA S. JAINDirector (Procurement), Pride Hotels

Hard Work PaysHard Work Pays

48

APRIL 2019, Rs 50

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