BRANDWAGON, P8 BACK PAGE, P20 INTERNATIONAL, P5 SUBSCRIPTION MARKETING THE BIG PICTURE TO LEAVE AT END OF 2024 Passport to full house: PVR-INOX looks to raise weekday occupancy It's not the end of the show: Connected TV will boost viewership Boeing CEO to step down in overhaul due to safety crisis FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL NO. XLIV 273, 20 PAGES, `12.00 P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E PLI investments falter JSW-MG'S 'MARUTI' MOMENT FRAUGHT Pharma, food processing SCHEME SNAPSHOT PLI schemes: ■ Expected investment: `2.98 trillion WITH ROADBLOCKS fare well; auto & solar ■ Actual investment*: 1.07 trillion PV modules creep along IN 1983, WHEN Maruti FE S P E C I A L S New Kia Sonet review: Gimbap among small SUVs This Korean SUV is a visual delight, and expensive, just like authentic gimbap ■ MOTOBAHN, P8 Can the pharma ethics code stop malpractices? A self-regulatory mechanism may not be enough in case of serious violations ■ EXPLAINER, P20 Office leasing jumps 35% so far this year Specialty steel 13.6 10.1 Trends in grade A gross absorption (in million sq feet) 3.2 4 25 Q1 CY23 2.9 1.3 Q1 of 2024 saw office leasing of 13.6 million sq ft across the top six cities, marking a 35% increase against the year-ago period.Although this is a drop from the record uptake in the last quarter of 2023, the yearly increase is indicative of upbeat occupier sentiment, as the first quarter is typically slower, says property consultant Colliers. — Compiled by Raghavendra Kamath ACC Battery Storage IT Hardware Medical devices Telecom White goods Bulk drugs Food processing Large scale electronics Automobiles & autocomponents Textiles Continued on Page 5 Q1 CY24 2.2 2.5 123 y-o-y change (%) 1.9 1 14 90 Bengaluru Hyderabad Delhi-NCR 4 Q1 CY23 Q1 CY24 0.8 0.8 6 Mumbai Trends in grade A new supply (in million sq feet) 1.6 1.5 35 Chennai Pune 9.5 9.8 4.4 2.4 2.6 11 1.3 8 0.5 62 1 0.4 0.8 0.3 150 Bengaluru Hyderabad Delhi-NCR 67 Chennai Pune 3 Pan-India Source: Colliers INSOLVENCY EXPERTS ARE making a fresh pitch for changes to the Insolvency and Bankruptcy Code (IBC) to address one of the glaring shortfalls of the current regime—absenceofamechanismtoensure a fair share of realised proceeds of resolution for operational creditors. “Operational creditors have been muted with abysmally low recoveries (under the IBC),and nowtheyunderstand that the IBC cannot shield their rights as its provisions seem to be predominantly financial creditor-centric,” said Anjali Jain, partner, Areness.“The reason behind such discrimina- Financial creditors Operational creditors Corporate debtors 3,300 3,586 435 PRIYANSH VERMA New Delhi, March 25 408 Stakeholder-wise distribution of initiation of CIRPs 423 INSOLVENCYTRACKER 3,152 3,502 Operational creditors may get relief Call gets louder for amendments to IBC As on Mar As on Mar As on Mar As on Jun As on Sept As on Dec 2021 2022 2023 2023 2023 2023 tion is the lack of statutory protection of claimsofOCsoverandabovetheliquidation value and since in majority of cases resolved, the liquidation value assigned to their claims is negligible,”she said. Financial creditors (FCs) are those who lend money to a company,whereas OCs are LEADING BANKS SUCH as State Bank of India and Axis Bank are looking to increase their Unified Payments Interface (UPI) market share by upgrading their mobile applications to draw in both customers and non-customers. Armed with a third-party application provider (TPAP) licence, they are making an aggressive foray into the space currently dominated by PhonePe, Google Pay and Paytm. “Wewant ourapp to serve as an alternative to the existing UPI apps.Sincewewant to serve newcustomers of the bank ornoncustomers,theyshould be able to do things that they do on third party applications,” says Nitin Chugh, deputy managing directorand head (digital banking and transformation),State Bank of India (SBI). SBI is set to launch a revamped YONO 2.0 platform accessible to both customers and non-customers. The application will serveasamarketplacewhereinuserswillbe able to avail banking services and purchase products. Currently, banks need a TPAP licence to service non-customers. “Evenifyoudonothavean accountwith SBI,you can come on the application,register yourself and start making UPI payments, much like what you would do on PhonePe or Google Pay,”says Chugh. This eagerness among banks to make inroads into the UPI payments segment RAGHAVENDRA KAMATH Mumbai, March 25 1 0.6 63 Mumbai SBI, Axis and Yes get aggressive in courting non-customers APP PLAY ■ SBI is set to launch a revamped YONO 2.0 platform accessible to both customers and noncustomers ■ Yes Bank, Axis Bank, and ICICI Bank are also targeting non-customers with their mobile applications ■ UPI transaction volumes surpassed 12 billion, and transaction value crossed `18 trn ■ PhonePe, Google Pay and Paytm together held about 95% volume market mark in December share in February ■ Currently, banks require a third-party application provider licence to service non-customers stems from the fact that UPI transactions have been rising steadily in recent years. UPI transaction volumes surpassed 12 billion,and transactionvalue crossed `18 trillion mark in December, data from the National Payments Corporation of India(NPCI) showed. Apart from SBI, lenders like Yes Bank, Axis Bank, and ICICI Bank are also targeting non-customers with their mobile applications. Continued on Page 5 Price spike may push up housing inventory Pan-India y-o-y change (%) 390 RECORD-LOW PRICES OF renewable energy certificates (RECs) on power exchanges have allowed power distribution companies (discoms) to improve compliance with their renewable purchase obligations (RPOs) in the current financial year, reports Arunima Bharadwaj. ■ PAGE 2 tion is behind schedule in many sectors except electronics (mobile phones) orpharmaceuticals,sectorsanalystssaywouldanyway have seen investments in the natural course of business cycle. 2,916 3,270 DISCOMS IMPROVE COMPLIANCE ON GREEN ENERGY *Cumulative up to December 2023 Keeping inviewIndia’svision of becoming ‘Atmanirbhar’ and to enhance India’s manufacturing capabilities and exports,an outlay of nearly `2 trillion was announced in the Union Budget 2021-22 for the PLI schemes. Most of the schemes were announced in 2021, but the implementa- Big banks step up play in UPI space AJAY RAMANATHAN Mumbai, March 25 Actual investment* (` crore) 320 GLOBAL LIGHTHOUSE NETWORK, a World Economic Forum (WEF) initiative, has managed to hand-hold 15 manufacturing locations in India to shift to the use of latest technologies on offer in the world, reports Mukesh Jagota. ■ PAGE 2 Projected investment 2,262 2,731 UNILEVER, RENEW AMONG 15 FIRMS TO GETWEF SUPPORT COMPANIES HAVE INVESTED over `1.07 trillion in two years through December 2023 under the 14 Production-Linked Incentive (PLI) schemes, or about 40% of the `3 trillion committed. However, the trend is barely par for the course,withbiglagsininvestmentsinmany sectors such as high-efficiency solar PV modules, automobiles, ACC batteries and textilesthatweresupposedtolead thepack. According to official data, of the expected production or incremental sales target of `40 trillion, just 17% has been achieved till December 2023. Of the direct employment potential of 1.15 million under the 14 schemes, 43% has been achieved. Investments by the PLI-eligible firms have to be made in the initial four years to be able to gain maximum incentives. Most of the schemes were rolled out in 2021-22, implying that the investments should have been much higher by now. 277 STOCKS OF PUBLIC sector banks (PSBs) will likely continue outperforming the private peers for a major part of the next financial year, according to analysts, reports Piyush Shukla. The Nifty PSU Bank index has risen 85% in the current fiscal. ■ PAGE 7 incremental sales: `40 trillion ■ Actual production/incremental sales: `6.69 trillion* 1,891 2,258 ANALYSTS BULLISH ON PSB STOCKS IN COMING FISCAL ■ Expected production/ No of firms selected: 638 High efficiency solar PV modules THE COUNTRY'S OLDEST department store chain, Shoppers Stop, is accelerating the pace of launches within its beauty vertical, reports Viveat Susan Pinto. This includes setting up more standalone beauty stores and exclusive brand outlets. ■ PAGE 4 PRASANTA SAHU New Delhi, March 25 ■ Actual employment: employment: 1.15 million 0.49 million* 17,275 25,813 1,10,352 22,904 67,690 13,037 11,324 7,452 7,541 7,350 3,939 3,586 19,798 3,317 6,766 2,721 4,014 2,865 1,850 305 1,330 864 2,517 270 13,810 3,236 29,531 12,892 SHOPPER'S STOP TARGETING BEAUTY SPACE 14 Pharmaceuticals Suzuki launched its first passenger vehicle, there were few challengers. JSW Group chairman Sajjan Jindal's ambition to recreate a 'Maruti' moment in the EV space is commendable, albeit fraught with roadblocks, according to experts, reports Swaraj Baggonkar. ■ PAGE 4 ■ Expected Drones NEWS ONLY AT 40% OF GOAL AS HIGH-POTENTIAL SECTORS LAG 3,040 3,379 IN THE those who provide the goods and services to a company in their common course of business. Under the IBC, enacted in 2016, FCs haveaprimaryclaimontheassetsduringdistributionwhile OCs have a secondaryclaim. Continued on Page 5 UNSOLD INVENTORYIN residential properties is likely to increase due to a sharp price rise and increase in launches. Housing prices went up sharply by 1535% in 2023, especially in key markets like National Capital Region (NCR), Hyderabad and Mumbai. Luxury property prices have gone up even more at 20-50%, as per CLSA. “This (rise in prices) has also led to an increase in speculative demand,especially in the NCR market. Such a sharp increase in prices may deter end-users, which will then lead to high unsold inventoryas speculative buyers try to offload their units,” CLSA said. Between 25-40% of buyers are speculators/ investors in NCR, as per channel checks done by the brokerage. “If unsold inventories rise, it would certainly put downward pressure on prices,”said an analystwho did notwant to be quoted. Besides price rise, an increase in launches in residential properties maylead to higher unsold stock in FY26, India Ratings and Research said recently.The robust sales seen in residential real estate in FY24 could moderate in FY25, it said.“Factors such as escalating home prices and interest rates,a high base of FY23-FY24,and an influx of new launches are likely to limit the growth rates,”the rating firm said. PRICE STORY ■ Housing prices went up 15-35% in 2023 in Delhi-NCR & Mumbai ■ Luxury property prices rose even more at 20-50% ■ Price rise leads to rise in speculators, and deters end users ■ 25-40% of buyers are speculators/ investors in NCR Source: CLSA, India Ratings CHENNAI/KOCHI, TUESDAY, MARCH 26, 2024 Price rise in the last twoyears and sticky interest rates could lead to moderation in prices of specific types of products,it said. “Largely, the affordable segment (less than `5 lakh) and mid-segment (`50 lakh to `1 crore),as a proportion of overall sales has been showing a declining trend fortop eight cities forthese segments.Developers may resort to price moderation for faster inventory offtake,”said Vikas Anand,associate director,India Ratings & Research. Continued on Page 5 ALMOST HALF OF SALES NOW BACKED BY EMIs, LONGER-TENURE LOANS With easy financing, credit-based consumer sales double VIVEAT SUSAN PINTO Mumbai, March 25 FOR INDIAN BUYERS, EMIs, or equated monthly instalments, are notanunfamiliarconcept.Thetrend of piecemeal payments has driven high-value purchases in India for long,whether it be cars or homes.It is now slowly but steadily taking over smaller purchases too, as consumers look to upgrade their products or seek instant gratification. Conversations with consumer durable companies and electronic retailers indicate that sales backed by credit-schemes such as no-cost or low-cost EMIs, longer-tenure loans, zero-down payment options, buyback guarantees and cashbacks now contribute nearly 45% of industry sales from 15- KAMAL NANDI, BUSINESS HEAD & EVP, GODREJ APPLIANCES "FIRST-TIME BUYERS TODAY ARE DIRECTLY GOING IN FOR FEATURERICH PRODUCTS BACKED BY CREDIT SCHEMES" 20% five years ago. “The share of sales from easy financinghasmore than doubledin five years as consumers are looking for premium products within their budgets.First-timebuyerstodayare directly going in for feature-rich NILESH GUPTA, DIRECTOR, VIJAY SALES I DON’T THINK CONSUMERS HAVE BEEN IMPACTED IN A SIGNIFICANT WAY DUE TO THE RBI STRICTURE (ON CONSUMER CREDIT)" productsbackedbycreditschemes,” Kamal Nandi, business head and executive vice-president, Godrej Appliances,said. For instance, on Bajaj Mall, the online marketplace of Bajaj Finserv, a 1.5-ton Godrej SplitAC,which has an offerprice of `31,990 currently, can be purchased using a zerointerest EMI option (of `3,199 or `2,666 for per month).While there is a down payment to be made (`6,398 or `10,664), the EMI amountissmallandspreadoutover an eight-month period to reduce the burden on consumers. Avneet Singh Marwah, chief executive officer of Super Plastronics, a consumer durables manufacturing company with licences for brands such as Thomson, Kodak and Blaupunkt in India, said that during key online festivals or sale days,60-70% of purchases are driven by credit schemes.“ Categories such as television sets,forinstance,where consumers want a bigger and better audiovisual experience, the adoption of larger screen sizes is increasingly getting fuelled by attractive credit schemes,” Marwah said.“I see this trend only growing as consumers look for better products.” Online platforms such as Amazon, Flipkart, and others offer no- cost EMI on various cards, paylater, and zero-down payment options. Many retailers, meanwhile, have tie-ups with banks and financial institutions like Bajaj Finserv and HDB Financial Services, making it easier for consumers to applyforloans across tenures,avail discounts, cashbacks and reward schemes on credit cards. The Reserve Bank of India (RBI) recently increased the risk weight on consumer credit, including credit card receivables and bank loans to non-banking financial companies, to check the rise of unsecured consumer loans. Manufacturers and retailers admit that the increase in borrowing cost would be borne by them equally. Continued on Page 5 CHENNAI/KOCHI