BRANDWAGON, P9 COMPANIES, P4 INTERNATIONAL, P3 Our key competitor is cash: MobiKwik’s Taku Coke bottlers wary of monetisation plan iPhones to have OLED displays from 2025 KOLKATA, WEDNESDAY, SEPTEMBER 4, 2024 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL 33 NO. 260, 42 PAGES, `12.00 (NORTH EAST STATES & ANDAMAN `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 SENSEX: 82,555.44 ▼ 4.40 NIFTY: 25,279.85 ▲ 1.15 NIKKEI 225: 38,686.31 ▼ 14.56 HANG SENG: 17,651.49 ▼ 40.48 `/$: 83.97 ▼ 0.04 `/€: 92.70 ▲ 0.21 BRENT: $74.40 ▼ $3.12 GOLD: `71,135 ▼ `124 THE SEBI IS working on allowing simplified registration rules for foreigners investing only in government bonds, whole time member Ananth Narayan said at a CII event, reports Vivek Kumar M. ■ PAGE 7 CIPLA'S MK HAMIED RESIGNS DUE TO HEALTH REASONS CIPLA ON TUESDAY said MK Hamied has resigned as vice chairman with effect from October 29 due to age and health, reports PTI. Kamil Hamied has been named non-executive director, with effect November 1. BAJAJ FINANCE HAS NO PLANS YET FOR BANKING LICENCE BAJAJ FINANCE HAS no immediate plans to apply for a banking licence as the existing one is more than sufficient to drive its growth, said Sanjiv Bajaj, chairman and MD of Bajaj Finserv, reports Sachin Kumar. ■ PAGE 6 AU SMALL FIN BANK SEEKS UNIVERSAL BANKING LICENCE AU SMALL FINANCE Bank has submitted an application before the RBI to transition to a universal bank, reports Anupreksha Jain. ■ PAGE 6 FE S P E C I A L Why GIFT City needs relaxed listing norms A differential regulatory regime will help attract more entities ■ EXPLAINER, P9 GROWTH PROJECTION ■ India needs to diversify its export basket, leverage global value chains FE BUREAU New Delhi, September 3 AMID CHALLENGING EXTERNAL conditions, the World Bank on Tuesday raised India’s gross domestic product (GDP) growth forecast for FY25 to 7% from an earlier estimate of 6.6%, helped by the government spending on infrastructure and recovery in agriculture and rural demand. To reach its $1-trillion merchandise exports goal by2030,India needs to diversify its export basket and leverage global value chains,it said.India’s global trade share hasn’t kept pace with its fast-growing economy. Indiawas losing out to rivals like Bangladesh and Vietnam as low-cost manufacturing export hubs,it said. In its India Development Update, the World Bank said it expects India’s mediumterm outlook to remain positive. Growth is expected to remain strong in FY26 and FY27 as well.With robust revenue growth and further fiscal consolidation, the debt-to-GDP ratio is projected to decline from 83.9% in FY24 to 82% by FY27. The current account deficit is expected to remain at around 11.6% of GDP up to FY27,it said. “India’s robust growth prospects along with declining inflation will help to reduce extremepoverty,”saidAugusteTanoKouame, World Bank country director in India.“India canboost its growth furtherbyharnessing its ■ Its global trade share GDP growth estimate hasn’t kept for FY25 (%) pace with its 7.2 7.2 7.2 7 7 fast-growing economy IMF EASIER NORMS FOR THOSE INVESTING ONLY IN G-SECS Cites govt spending on infra, rural recovery World Bank THE DEFENCE MINISTRY HAS approved the procurement of future-ready combat vehicles for modernisation of the Army's tank fleet and air defence fire control radars, among other proposals, amounting to `1.45 lakh crore. reports PTI. ■ PAGE 2 RBI BIG-TICKET DEFENCE PURCHASES WORTH `1.45L CR CLEARED World Bank ups India FY25 GDP forecast to 7% Fitch NEWS STRONG OUTLOOK FOR FY26 AND FY27 Moody’s IN THE ■ It is losing out to rivals like Vietnam, Bangladesh as low-cost manufacturing export hubs global trade potential.In addition to IT,business services and pharma where it excels, India can diversify its export basket with increased exports in textiles, apparel, and footwear sectors, as well as electronics and green technology products,”he said. Global rating agencies Moody’s and Fitch haveprojectedIndiatogrowat7.2%inFY25, in line with the Reserve Bank of India’s estimate for the year. Continued on Page 7 Laptop, IT hardware imports touch $5 bn MUKESH JAGOTA New Delhi, September 3 BOUND FOR REVIEW AS THE IMPORT monitoring system for laptops and otherIThardware productswill end onSeptember30,authorisedcompanieshave brought in around $5 billion worth of these products in the April-August period of the current financial year. Thesurgecanbeattributedtothemoveby these companies to stock up on these products as clarity is still to emerge on the import policy after the current system expires, with many fearing curbs/ban. This jump has been noticeable in the last two months as between April and June only $2.5 billion worth of these products were imported. The maximum imports have been reported from China — as was the caseearliertoo. In 2023-24, the imports of laptops, tablets, all-in-one personal computers, ultra small form factorcomputers and servers had stood at around $8.4 billion. The import management system that imposes the condition of priorauthorisation for imports was put in place from November 1, 2023. At that time, the government had approved 110 applications for imports from brand owners,retailers and resellers seeking approval to import up to $10 billionworth of these goods. The applicants who got the approval included the likes of Lenovo and How Dunzo emptied its cart Desertion by Google and Reliance Retail was the final blow ANEES HUSSAIN Bengaluru, September 3 ITONCE BECAME averbsynonymouswith convenienthyperlocaldeliveryinIndia.The reason was simple: In 2016,Dunzo tapped intoanascentdemandforefficientandfast delivery of grocery,food,medicine,etc,and boasted millions of users and a billion-dollarvaluationwithina short span of time. Theworldhascomecrashingdownsince then.Lastweek,Dunzo,founded byKabeer Biswas, Ankur Agarwal, Dalvir Suri and Mukund Jha, sacked 150 staff, leaving it withjust50employeesandabalancesheet awashinred.Industrysourcessaidthattwo of the prominent investors in the firm, Reliance Retail,which has a 25.8% stake, andGoogle,whichholds20%,haverefused tocometothecompany’saidasithasfailed to meet a set of service level agreements. One of the condition was that Dunzo will become cash flowpositive. Dunzo's losses have jumped to `1,801 crore in FY23 from `464 crore in FY22. IN DIRE STRAITS `1,801 cr losses in FY23 25.8% stakeholder Reliance Retail has refused to come to Dunzo’s help ■ The import surge in AprilAug attributed to companies stocking up on laptops, tablets, PCS, etc as the end date of September 30 for shipment monitoring approaches ■ Clarity still to emerge on the import policy, with many fearing import curbs/ban ■ Commerce ministry says the future of the system lies in MeitY's hands Xiaomi. The local arms of these authorised companiessourcetheseproductsfromChina, and other multinationals like Dell, HP,Apple and Samsung. The approvals that the importers got are valid till the month-end. Continued on Page 7 stake owned by Google, which refused aid too THE GOVERNMENT MODEL ITI in Gurugram is located right in the middle of big ITand auto manufacturing hubs. The locational advantage, however, has made little difference to its placement record. Barring a handful of companies which provide on-the-job training and subsequentjobs,the ITI doesn't feature on the hiring map of most reputedcompaniesoperatingoutof Gurugram.The reasons areaplenty: Outdatedcurriculum,lackofindustry-specific training, poor perception of students among companies, weak industry engagement,etc. For instance, in the welder programme, which is one of the 25 courses offered at this ITI, the students are still trained in the conventional processes like TIG (tungsten inert gas) and MIG (metal inert ■ Just a handful of companies, including Maruti, provide on-thejob training and subsequent jobs 25 courses offered at Government Model ITI in Gurugram 44% shortage of faculty at the institute 40 1,308 1,170 tutors against seats the sanctioned offered by strength of 72 this ITI gas) whereas the industry is demandinginductionwelding,spot welding and robotic welding. “We don't have the training that meetstheindustryrequirement.But to give our students hands-on experience on the actual machines and seats are currently occupied ■ Students are still trained in the conventional processes, not meeting industry standards processes,we are tying upwith companies,” said Jaideep Kadiyan,principal of the ITI. For instance, Maruti Suzuki has set up a lab within the institute to train in auto body repair and auto bodypaint. In fact, Maruti is one of the few ■ The ailing company’s efforts to raise up to $25 million through external investors also hit a roadblock ■ Key investor Lightbox vacated its board seat in May, following earlier exits by representatives from Reliance Retail and Lightrock Continued on Page 7 NFRA may refuse to budge on proposed audit upgrade plan MANU KAUSHIK New Delhi, September 3 THE NATIONAL FINANCIAL Reporting Authority(NFRA) is unlikelyto roll back or materially change its proposed plan to upgrade to International Standard on Auditing (ISA) 600, despite the concerns raised by the Institute of Chartered Accountants of India (ICAI). FE has learnt from sources privyto the matterthat there is“a growing consensus” among majority of the members of the 12-member panel authorised to prepare the draft ISA-600 that any special carveouts or relaxations from the internationally followed norms in this regard should not be allowed,as it could undermine the audit quality. Also, key regulators of the country, including the Reserve Bank of India and the Securities and Exchange Board of India (Sebi), too, have supported QUALITY CALL ■ ISA 600 to be published next week to stick to global norms ■ Carve-outs for small- and midsize auditors unlikely ■ Key regulators, including RBI and Sebi, too support the NFRA move THE GOVERNMENTWILL SELL around 6.78% stake in General Insurance Corporation (GIC Re) onWednesday and Thursday to raise about `4,700 crore based on the floor price of `395/share for the offer for sale, reports fe Bureau. The share price of GIC Re closed at `421.25 on the BSE on Tuesday,down 0.13% from the previous close. The OFS floor price is at a discount of 6.6% to the Tuesday’s closing price. ■ PAGE 6 PharmEasy valuation slashed by over 90% API HOLDINGS, THE parent company of online pharmacy PharmEasy,has seen a 92% markdown in its valuation—plungingfromapeakof$5.6billionin2021to $458 million, according to recent SEC filings, reports fe Bureau. Global asset management firm Janus Henderson, which made its first investment in PharmEasy during the company’s Series F funding round in 2021, has reduced its valuation of the company. ■ PAGE 4 companies that engagewith differ- Asagainstthesanctionedstrengthof ent ITIs to tap blue-collar talent. A 72,it's operating with just 40 tutors. companyofficial told FE that it cur- “Wehave beenrepeatedlyaskingthe rently supports 45 government concerned authorities to hire new staff but there seems to be ITIs across the country out no action from them,” ofwhich 14 train in masaid anotherofficial. nufacturing, 23 in seThe ITI offers 1,308 vice and the rest 8 in seats, of which about both manufacturing 1,170arecurrentlyoccand service. upied. Shubham, who Aseniorofficialatthe TESTING just passed out of the ITIsaidthatthisinstitute one-yearweldercourse, hasnotbeenabletocatch TIME FOR said when he enrolled a upwiththecurrentmaryear ago, there were 60 ket trends.Take the case students across four of the mechanic electric batches.“Now,about35stuvehiclecourse.“Eventhough the government was prompt to dentsareleft.Manystudentshereare introduce the programme,there are casual about studies.They leave the no tutors or infrastructure (tools, course in between to pursue someequipment,machinery)availablefor thing else. Some students are not training,”theofficialsaidonthecon- allowed to give exams due to shortage inattendance,” he said. dition of anonymity. Meanwhile,the institute is grappling with 44% shortage of faculty. Continued on Page 7 ITIs - III ■ ICAI says the move could push most of India's audit firms out of business the NFRA move,the sources added. Aseniorofficial said the draftwould be published for public comments in a week. The ICAI has raised objections to the Training yes, but not what industry requires NOT INDUSTRY-READY ■ Dunzo was looking at an investment of $20 million by Reliance Retail efforts to raise $22-25 million through external investors have also hit a roadblock as potential investors do not seem to be convinced of its abilityto revive.This is evident through the emails which co-founder and CEO Kabeer Biswas has written to employees in the last two months. Though the company'sFY24financialsarenotavailable,analystssaid that losses may have narrowed because of cost-cutting,butrevenueswouldalsohave declined,socashflowproblemcontinues. The company did not respond to requests forcomments. Dunzo was looking at an investment of around $20 million byReliance Retail to tide overits cash crunch.Its DESPITE BEING NEAR BIG IT HUBS, THIS ITI DOESN'T FEATURE ON THE HIRING MAP MANU KAUSHIK New Delhi, September 3 ■ Two co-founders Dalvir Suri and Mukund Jha have reportedly left 20% Govt to launch GIC Re OFS today, sell 6.78% ■ Industry anxious ■ Core team now reduced to a mere 50 members from its peak of over 1,000 employees proposed overhaul of SA-600 norms (concerning use of another auditor's work), which would lead to the principal auditor of a corporate group to be in charge of the auditors of all subsidiaries in the group. Given that alreadythe listed firms are the preserveoflargeauditorslikeBigFive,this couldexpandtheirremittoalargesections of Indian companies, including a sizeable number of unlisted ones. The ICAI had said that the move could push most of India's audit firms out of business, and lead to concentration of audit market with a handful of firms.The council is scheduled to meet on September 17 to deliberate on the matter. If NFRA has to allow carve-outs (for smaller audit firms) in ISA 600, then the standards would be out of sync with the international ones. Continued on Page 7 Cong questions ICICI’s ‘no salary to Buch’ claim PRESS TRUST OF INDIA New Delhi, September 3 THE CONGRESS ONTuesdayquestioned ICICI Bank’s assertion that it had not paid any salary or granted ESOPs to Sebi chairperson Madhabi Puri Buch after her retirement. It asked that if the amount paid to her was her“retiral benefit”,why was it non-uniform, both in terms of frequency and amount. The Opposition party had levelled fresh conflict-of-interest allegations against Buch on Monday. The party alleged that since Buch took office in 2017, she has not only been drawing a salary from the Sebi, but has also been holding an office of profit at the ICICI Bank, continuing to receive income from the private lender to this very day. Refuting the allegations, ICICI Bank said it has not paid any salary or granted ESOPs to Buch after her retirement on October 31,2013,as alleged by the Congress. Rebutting the claims, Congress media and publicity department head Pawan Khera said the ICICI Bank’s statement attempts to provide a response,but in reality,ends up giving more information and confirming his party’s charges. On Tuesday, Khera asked why has the so-called “retiral benefit” been non-uniform both in terms of its frequency and amount. “Even if we were to assume that the `5.03 crore she received from ICICI in 2014-2015 (soon after her superannuation) was part of her retiral benefit and that she got nothingin2015-2016,whydidthis so called retiral benefit resume in 2016-2017 and continue until 2021?”Khera said. “The average salary drawn by FRESH SALVO Charges ■ If the amount paid to Buch was her retiral benefit, why was it nonuniform, both in terms of frequency and amount ■ Since taking office in 2017, Buch hasn’t only been drawing a salary from Sebi, but has also been holding an office of profit at the ICICI Bank Counter ■ ICICI Bank claims the amount paid to Buch had accrued to her during her employment phase at the bank and is her retiral benefit ■ It says it has not paid any salary or granted ESOPs to Buch after her retirement on October 31, 2013 Buch from 2007 up until 2013-14 (right before her superannuation from ICICI) is `1.3 crore per annum. However, the so-called retiral benefit given by ICICI to Buch from 2016-17 to 2020-21 averages to around `2.77 crore per annum. How can a person’s retiral benefit be more than her salary as an employee?” the Congress leader asked. Continued on Page 7 Kolkata