VERDICT 2024, P7 COMPANIES, P4 INTERNATIONAL, P3 DELHI EXCISE POLICY CASE BANKING ON RECENT FUNDRAISE SELF-DRIVING SYSTEM DEVELOPMENT ED names Kejriwal, AAP as accused in liquor case chargesheet Vodafone Idea plans up to `55,000-crore capex over 3 years, says CEO Tesla pushes plan for China data to power its AI ambitions KOLKATA, SATURDAY, MAY 18, 2024 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL 33 NO. 168, 26 PAGES, `12.00 (NORTH EAST STATES & ANDAMAN `13.00) 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 SENSEX: 73,917.03 ▲ 253.31 NIFTY: 22,466.10 ▲ 62.25 NIKKEI 225: 38,787.38 ▼ 132.88 HANG SENG: 19553.61 ▲ 177.08 `/$: 83.33 ▲ 0.17 `/€: 90.38 ▲ 0.39 BRENT: $83.28 ▲ $0.01 GOLD: `73,016 ▼ `139 NEWS SEBI PROPOSES 20% INDIAN EQUITY CAP FOR FOREIGN FoF THE SEBI HAS proposed allowing investments by mutual fund houses in overseas fund of funds that hold up to 20% of their corpus in Indian securities, reports Akshata Gorde. Sebi has floated a consultation paper, inviting public comments on its proposal by June 7. ■ PAGE 6 BROOKFIELD MAY INVEST $500 MN IN LEAP GREEN BROOKFIELD ASSET MANAGEMENT is planning to invest about $500 million for a majority stake in Indian renewable power firm Leap Green Energy, reports Bloomberg. Post the deal, Brookfield would likely own a majority stake. ■ PAGE 4 ADMINISTRATOR OF RCAP SEEKS 10 DAYS FOR ASSETTRANSFER THE ADMINISTRATOR OF Reliance Capital has approached the Reserve Bank of India to seek a 10-day extension of the deadline to transfer businesses to the successful bidder — a Hinduja Group company, reports PTI. ■ PAGE 4 MISCONDUCT ORDER PASSED AGAINST PWC FIRMS BY ICAI THE ICAI HAS passed a disciplinary order against Price Waterhouse & Co LLP, New Delhi and its network firms for professional misconduct, reports Manu Kaushik. ■ PAGE 2 RBI GETS AROUND 60% MORE BIDS FROM VRR AUCTION THE RBI HAS received bids worth `1.95 trillon from banks, against the notified `1.25 trillion, at the variable rate repo auction, reports Sachin Kumar. ■ PAGE 6 RESULTS CORNER JSW Steel profit falls 65% on coking coal costs PAGE 4 Zee posts `13-cr profit, revenue rises 3% PAGE 5 FE S P E C I A L S New Maruti Suzuki Swift: A hatch that’s difficult to match! It's good value, is amazing to drive, and looks like a mini-MINI Cooper. ■ MOTOBAHN, P9 Make the most of cashbacks Combine cashbacks with discounts & coupons to maximise savings ■ PERSONAL FINANCE, P9 RELIEF FOR GLOBAL AUTOMAKERS 15% duty likely for existing EV investments too $100-BN CLUB HAS 15 MEMBERS THEWORLD’S SUPERRICH club now has 15 members with fortunes over $100 billion, the most on record.The combined net worth for these people is up 13% this year to $2.2 trillion.This is the first time that all 15 have held fortunes of that size at the same time. GautamAdani recently returned to the elite group after losing a chunk of his wealth in 2023 . Cut-off date, investment breakup may be finalised on a case-by-case basis Bernard Arnault 221 2 3 Jeff Bezos 206 6 Larry Page 168 7 8 Sergey Brin 154 5 Mark Zuckerberg 188 Bill Gates 1 4 Elon Musk 9 Steve Ballmer 146 155 146 Warren Buffett 137 Total net worth ($ bn) MUKESH JAGOTA & ROHITVAID New Delhi, May 17 GLOBALAUTOMAKERSARElikelytogetrelief as the government may consider existing investments in electric vehicle (EV) manufacturing for import concessions.Under the new EV policy, these companies may qualify for a lower import duty of 15% for a three-year period. However, officials said the decision wouldbetakenonacase-by-casebasisafterthe companiesconcernedsubmittheirplans,show investment break-up and flow. For instance, Vinfast, a Vietnamese EV maker,had announced in January its plans to invest $500 million in India overa span of five years.But the EV policy allowing concessional importswasannouncedlaterinMarchandhasn’t been operationalised yet. In this case, the company can avail the benefits though it startedmakinginvestmentsbeforethepolicywas announced and operationlised,officials said. “Even companies who had begun investing in EV factories before the policywas notifiedwouldbeeligibleforincentivesunderthe policy.It is not that theywould have invested much so far. Whatever they invest theoreticallyis legit,”officials said. Similarly, several existing auto firms have announced huge capex for several years.They candivertpartofittowardsEVstoavailthebenefits of this policy. “How much they have invested,tillwhenandbywhattime-framethe balance amount needs to be invested will be Rank ON TRACK ■ Completely built-up units priced $35,000 and above to attract lower 15% import duty for a period of five years ■ They need to achieve 25% localisation by the third year, 50% by the fifth year ■ For others, CBUs priced over $40,000 to continue to attract 100% duty, 70% for those priced below 13 Michael Dell 15 Francoise Bettencourt Meyers Carlos Slim 12 99.9 FM: Policy support for manufacturing likely assessed on a case-by-case basis,” officialssaid. Existing multinational companies like BMW, Volkswagen Group, Mercedes Benz, alongwithKoreanmanufacturerslikeHyundai andKia,andsomedomesticplayers,hadraised theissuewiththegovernmentabouttheirearlier investments in the EV space, urging that that these should be counted retrospectively. FE BUREAU New Delhi, May 17 CASE FILE ■ Asingle-judge order had in July 2023 affirmed the arbitral award ■ SpiceJet and Singh had sought to set aside the portion of the award ■ They were directed to refund `270 crore Maran to Kal Airways and Kalanithi face of the record or an illegality that goes to the root of the matter. Singh had approached the single judge bench challenging the arbitral award. The case dates to January 2015, when Singh,who owned the airline earlier, bought it back from Maran after it was grounded for months due to resource crunch. Continued on Page 10 Bandhan Bank’s PAT plunges 93% on higher provisioning AJAY RAMANATHAN Mumbai, May 17 Continued on Page 10 HC sets aside arbitral order against SpiceJet IN A RELIEF for cash-strapped SpiceJet, the Delhi High Court on Friday overturned an arbitral award in favour of Kalanithi Maran. A single judge bench had upheld an arbitral award asking SpiceJet and its promoter Ajay Singh to refund `579 crore plus interest to Maran. A bench of Justices Yashwant Varma and Ravinder Dudeja allowed the appeals filed by Singh and SpiceJet challenging the single judge bench's July 31,2023,order. Thedevelopmenthadapositiveimpacton SpiceJetshares,whichclosedup5.46%at`63 on the BSE. The division bench had earlier refused to stay the single judge's order and had asked Maran and his company Kal Airways to respond to the appeal. SpiceJet and Singh's counsel had earlierargued that the challenge was on the issue of 18% interest, which the tribunal had directed the carrier to pay. The single judge had upheld the award announcedbythearbitraltribunalonJuly20, 2018,in favour of Maran and Kal Airways. It had said the court was barred from entering into the merits of an award unless there was an error that was apparent on the 11 Larry Ellison 137 112 106 Mukesh Gautam Ambani 109 Adani 100 14 ■ However, it's must to set up manufacturing facilities in the country within 3 years under the new policy 10 Source: Bloomberg Billionaire Index IN THE Nirmala Sitharaman addresses the CII Annual Business Summit, in New Delhi on Friday PTI the last two years, the private sector is not investing in infrastructureprojectsexceptalittle bit through real estate investINDIAN PRODUCT MANUFACMUCH AGAINST ment trusts (REITs),infrastrucTURING requires greater THE ADVICE GIVEN ture investment trusts (InvITs), sophistication for a greater BY SOME alongwithsectorslikeportsand share in the global value chain, ECONOMISTS, I airports. finance minister Nirmala LIKE TO HIGHLIGHT “Much more needs to be Sitharaman said on Friday.“The done to attract private capital governmentneedstoassesshow THE FACTTHAT into infrastructure.We need to to give the best policy support,” MANUFACTURING come up with new models and she told India Inc at the CII MUST INCREASE new arrangements,” SubrahAnnualBusinessSummit2024. INSIDE manyam said. Dismissing the advice given He emphasised that India by some economists that India MORE REPORTS requires a lot of improvement should not focus on ramping up FROM CII SUMMIT in contract management and manufacturing,shesaid,“Iliketo dispute resolution to fast-track highlightthefactthatmanufac■ PAGE 2 legal processes as current turing must increase,” she said. lengthy processes are a drag. Citing a recent report by SubrahmanyamsaidmorefreetradeagreeCapgemini Research Institute, Sitharaman said India figures at the top of the list of ments (FTAs) are needed and lower tariffs are investment destinations forseniorexecutives required to competewith the rest of theworld. in Europe and the US, who are looking to India was in discussion recently with the UK reduce their dependence on China and shift and the European Union to sign such pacts. Subrahmanyam said that there is a need part of their manufacturing capacity to emergingmarkets.“Theirpreference is India,” for more institutions of global scale as India has just one insurance company among the she added. Speakingatthesameevent,NitiAayogCEO top 50 and only two banks in the top 100. BVR Subrahmanyam said while the government has invested heavilyin infrastructure in Continued on Page 10 FE BUREAU New Delhi, May 17 NIRMALA SITHARAMAN, FINANCE MINISTER BANDHAN BANK ON Friday reported a 93% year-on-year plunge in its profits aftertax to `55 crore in the fourth quarter, as it increased provisions and wrote off bad loans. The private lender’s profitstoodat`810croreayearago. The bottom line was significantly below the `890 crore estimated by analysts at Bloomberg. Chandra Shekhar Ghosh, MD & CEO, explained that the technical write-offsrelatetomicro-creditpertainingtoathree-yearperiodended 2021-22 (April-March).Of the total technicalwrite-offsof`3,852crore, the credit guarantee fund for micro units (CGFMU) portfolio stood at `3,053 crore. The bank said that it has technically written off loans as a prudent measure and in accordance with its policy.At the same time, the bank’s provisions rose 141% to `1,774 crore in Q4 from `735 crore a year ago,and this weighed on the bank's bottom line. Overall,thebank’sgrossadvances rose14.3%to`1.25trillionwhereas deposits jumped 25% to `1.35 trillion. The loan book was aided by commercialbanking,retailloansand housing book. The bank’s current account savings account (CASA) depositsstoodat`50,151crore.The CASAratio stood at 37.1%. Net interest income, the difference between interest earned and interestexpended,rose16%y-o-yto `2,866 crore in the March quarter. Thenetinterestmarginimprovedto 7.6% from 7.2% ayearago. Continued on Page 10 CHALLENGERS STILL HAVE A LONG WAY TO GO TO CATCH UP WITH LEGACY PLAYERS David and Goliath story unfolds in offline edtech space S SHANTHI Bengaluru, May 17 UNACADEMY WAS ONCE India’s second largest player byvaluation in the edtech space.Today,roughlyhalf of its consolidated revenues of `1,000 crore come from its over 85 offlinecentres.That’sahugechange, for which the edtech unicorn had to change its DNA. Other edtech firms such as Vedantu and Physics Wallah are also not far behind in challenging their original instincts of staying in the online space. Physics Wallah (PW), which counts Westbridge and GSV Ventures as its marquee investors, today operates as a hybrid test prep platform. Offline centres, though limitedinnumber,contributenearly CHANGE IN SYLLABUS Offline presence Edtech opportunity in India Total edtech startups: 15,374 Physics Wallah 79 Vidyapeeth centres in 51 cities Unacademy 85 Source: Technavio, Tracxn 40%to its overall revenue. “Currently,ourofflineVidyapeeth centres are teaching 200,000 students,showcasingsignificantgrowth inofflineengagement,”AnkitGupta, centres in 46 cities Total K-12 edtech startups: 6,955 Projected test prep market size: $9.20 billion by 2027 at CAGR of 13.9% CEO,PWOffline,told FE. PW has 79 Vidyapeeth centres in 51 cities and plans to open more by the end of the next fiscal year. In FY23, the edtech unicorn clocked a total revenue of `798 crore, up 3.4 times from the previous year. The companysaidthatthesurgewasdriven by increased penetration within the offline category. “We are expanding our educationalfootprintnationwide.Ourgoal is to create educational hubs that eliminate the need for extensive travel, making quality education accessibletoall,”saidGupta.Thecompany’s average revenue per user (Arpu) at offline coaching centres is around`50,000anditaimstomake it `65,000soon. In December last year, Unacademy’s CEO and cofounder Gaurav Munjal had said that the company’s cash burn has been slashed by about 60% for the calendaryear2023.He also said that the company has a runway of more than fouryears with its current cash reserves. “The online model had its relevanceduringthepandemicaspeople wereforcedtostayindoors,however, it also has its limitations in terms of exchange of ideas and knowledge sharing,”Anil Joshi, managing partner, Unicorn India Ventures, a firm that has invested in edtech startups ForiegnAdmits and HiWi,said. He added that Unacademy is adopting what its customer base wants else it will be challenging to sustain the business. Vamsi Krishna-led Vedantu has alsoforayedintoofflinetuitioncentres in the test prep and higher secondarycoachingatthebeginningof FY23. In December this year, it announced its plans to open more than 30 offine centres forJEE,NEET andfoundationcoursesacrosscities. Continued on Page 19 Kolkata