Short-video platform Chingari raises $15 mn funding led by Republic Capital

 Short-video platform Chingari on Monday said it has raised $15 million (about Rs 111.4 crore) in funding led by Republic Capital.

Short-video platform Chingari on Monday said it has raised USD 15 million (about Rs 111.4 crore) in funding led by Republic Capital.

The extended Series A round also saw participation from Onmobile, JPIN Venture Catalysts, Hill Harbour, Angellist, Venture Collective, Makan Family, Cowa Ventures, MVC Friends, Protocol Labs and other HNI family offices, a statement said.

The app will invest this new round of funds to enhance and integrate new in-app features, strengthen the backend technology team, as well as boost its marketing initiatives for 2022, it added.

Chingari had raised USD 19 million in crypto tokens from venture funds and individuals, including Republic Crypto, Solana Capital and Kraken, a US-based cryptocurrency exchange in October last year.

In April last year, Chingari had raised USD 13 million in a pre-Series A round led by OnMobile Global.

Major part of the fresh investment will be utilised to enhance the technology on the app, launch new features and augment the backend tech team by appointing the finest talent across artificial intelligence and machine learning with an aim to further enrich Chingari's user experience, it said.

Another important area of focus is to increase marketing initiatives to strengthen the brand's reach further into the roots of Bharat by making it a favourite among the tier III and IV audiences too, it added.

Walmart reveals plans to enter blockchain-based Metaverse, sell NFTs

 Amid the buzz around Metaverse, retail giant Walmart has revealed plans to enter the field of highly immersive virtual reality/augmented reality (VR/AR) and Blockchain-based world

Amid the buzz around Metaverse, retail giant Walmart has revealed plans to enter the field of highly immersive virtual reality/augmented reality (VR/AR) and Blockchain-based world.

Walmart's trademark filings indicate that the company is looking to establish its own NFTs (non-fungible tokens) and cryptocurrency, reports CNBC.

One of the trademark applications details possible "physical fitness training services" and "classes in the field of health and nutrition" that could take place in VR/AR environments.

In a separate filing, the company said "it would offer users a virtual currency, as well as non-fungible tokens, or NFTs," the report said on Sunday.

"Walmart is continuously exploring how emerging technologies may shape future shopping experiences," a Walmart spokesperson was quoted as saying in media reports. "We are testing new ideas all the time. Some ideas become products or services that make it to customers. And some we test, iterate, and learn from," according to the company.

Other retailers also have plans to enter metaverse, like Nike that aims to introduce NFTs and virtual sneakers while Adidas selling out of its aInto the Metaverse' NFT collection.

Gap has also started selling NFTs of its iconic logo sweatshirts.

The market for transactions in the Metaverse is expected to reach $6.1 billion this year, as tech giants like Meta (formerly Facebook) aim big on the VR/AR-based technology to bring deeper immersive experiences to billions in the future.

The global Metaverse market is forecast to hit nearly $42 billion globally by 2026, according to research firm Strategy Analytics.

Agritech startup DeHaat acquires Helicrofter, to empower farmers

 Agritech startup DeHaat on Monday said it has acquired Maharashtra-based B2B agri-input marketplace startup called Helicrofter, for an undisclosed sum

Agritech startup DeHaat on Monday said it has acquired Maharashtra-based B2B agri-input marketplace startup called Helicrofter, for an undisclosed sum

With the integration of Helicrofter, encompassing over 2,000 agri-input retailers and 30 sellers across Maharashtra, DeHaat has expanded its operation to another major agricultural belt, said Shashank Kumar, DeHaat's Co-founder and CEO.

DeHaat currently serves over 700,000 farmers across Bihar, Uttar Pradesh, Jharkhand, West Bengal, Odisha, Madhya Pradesh and Rajasthan.

Founded in 2020 by Siddhartha Choudhary, Helicrofter is a farm input e-commerce platform designed to do away with supply chain inefficiencies in the rural ecosystem.

Despite the pandemic, Helicrofter has achieved annual revenue in excess of Rs 50 crore.

"What makes this partnership even more ideal for us is the complementing ideologies and synergy of function that will enable us to work together in materialising our vision for the farmer communities that we jointly serve," said Choudhary.

DeHaat provides farmers with access to over 3,200 agricultural inputs, combined with AI-based customised crop advisory on pest and disease management, delivered via mobile app and call centres.

The platform also aggregates more than 30 crops from farmers on their network and directly supplies it to over 600 commodity bulk buyers, including retail chains, e-commerce players, FMCG giants, and SME food processors.

"We have been consistent with 35-40 per cent growth in our network on a month-on-month basis, and this acquisition will cement our footprint into Maharashtra and thereby the western part of India, which forms a major agri-cluster for the nation," said Amrendra Singh, Co-founder, DeHaat.

Tesla wooed by Indian states after Musk flags government problems

 The pitches, tweeted over the weekend, touted everything from infrastructure, sustainability and a streamlined approval process

Politicians from at least four Indian states took to Twitter to invite Tesla Inc. to set up shop in their provinces, just days after billionaire founder Elon Musk said the U.S. electric-vehicle pioneer was still facing a lot of challenges with the national government.

The pitches, tweeted over the weekend, touted everything from infrastructure, sustainability and a streamlined approval process. They were made from different parts of India -- Telangana in the south, Maharashtra in the west, Punjab in the north, and West Bengal in the east.

Musk and the Indian government have been in talks for years, but disagreements over a local factory and import duties have led to an impasse, meaning Tesla still doesn’t sell cars in India, three years after showing definite intent. While Prime Minister Narendra Modi’s administration wants Tesla to set up a factory to sell locally and export, Musk has insisted on slashing import duties of as much as 100% so that Tesla can first establish a market.

All the states that invited Tesla to start operations are ruled by parties opposed to Modi’s Bharatiya Janata Party, which runs the federal government.

Setting up car factories in India could be difficult even for local companies without any government support, as red tape, land acquisition and labor rights remain a constant challenge. In 2008, Tata Motors Ltd., run by India’s biggest conglomerate, was forced to abandon a near-complete facility in West Bengal after violent protests by farmers against land acquisition, thwarting its attempt to build the Nano, the world’s cheapest car, in the state.

“Drop here, we in West Bengal have best infra & our leader @MamataOfficial has got the vision. Bengal means Business,” Ghulam Rabbani, West Bengal’s minister for minority affairs and Madrassah education tweeted to Musk on Saturday. As an opposition leader, the state’s chief minister Mamata Banerjee had spearheaded a campaign demanding Tata Motors return the land acquired by the provincial government to farmers unwilling to give it up.

50 more startups with the potential to be unicorns in 2022: Report

 India has 50 startups with the potential to achieve the coveted unicorn' status in 2022 and by the end of the year, the list of the new-age companies valued at over $1 billion will be at least 100

India has 50 startups with the potential to achieve the coveted unicorn' status in 2022 and by the end of the year, the list of the new-age companies valued at over USD 1 billion will be at least 100, a report by a consultancy firm said on Monday.

In 2021, which witnessed a huge spike in company valuations in the listed and unlisted space driven by ample liquidity, according to some watchers, India added 43 startups to the list and the number of unicorns shot up to 68 by the end of the year.

Over USD 10 billion was invested in the Indian startup ecosystem in the October-December quarter alone, according to the report by PwC India.

We can see that the base of the companies in the growth stage and late-stage deals have improved significantly in CY21, depicting a stronger base of companies having the potential to reach unicorn status, the firm's partner for deals and startups Amit Nawka said.

He added that market sentiments are placed favourably towards startups, and when coupled with the large base of startups, the number of unicorns will go well beyond 100 by the end of 2022.

A December 2021 report by the Hurun Research Institute had said India is the third-largest home for unicorns globally but trails the US and China by a wide margin.

The PwC report said USD 35 billion were raised by Indian startups in over 1,000 rounds of funding in 2021, which was 1.5 times higher than the previous year. Edtech, software as a service and fintech sectors witnessed the highest activity.

From pandemic to endemic: Can 2022 succeed where 2021 failed?

 Health experts, however, are preaching caution, saying there's too much uncertainty about how virus will evolve, how much immunity society has built up, potential damage if people stop being careful

After two years of contagion and death, Covid is shifting again. Omicron is spreading faster than any previous variant, but it’s also proving less malevolent. There’s growing talk that the worst pandemic of the past century may soon be known in another way — as endemic.

Spain threw out the idea this week, when Prime Minister Pedro Sanchez said it’s time to think about new ways of living with Covid long term, such as the world does with the flu. Other countries jumped in, saying they may be moving toward a new chapter of the disease.

Health experts, however, are preaching caution, saying there’s too much uncertainty about how the virus will evolve, how much immunity society has built up and potential damage if people stop being careful.

From pandemic to endemic: Can 2022 succeed where 2021 failed?
It’s inevitable that governments will eventually need to regard Covid as one of many public health challenges that can be managed — rather than one requiring the urgency and focus devoted since early 2020.

The appetite for economically damaging lockdowns is long gone. Vaccines are protecting swathes of the population, and there’s even hope that omicron, with its frenetic spread and less powerful punch, may be hastening the path to the pandemic’s exit.

“We probably are starting to see a transition phase toward this becoming an endemic disease, which doesn’t mean that we have to stop being very prudent,” Spain’s deputy prime minister, Nadia Calvino, told Bloomberg Television. “But it does signal that we should take measures that are very different to the ones we had to take two years ago.”

Maruti Suzuki hikes vehicle prices by 4.3% to offset rise in input costs

 The country's largest carmaker Maruti Suzuki India said it has increased prices of its models by up to 4.3% with immediate effect to partially offset the impact of the rise in input costs

The country's largest carmaker Maruti Suzuki India (MSI) on Saturday said it has increased prices of its models by up to 4.3 per cent with immediate effect to partially offset the impact of the rise in input costs.

The company has enhanced prices across its models in the range of 0.1 per cent to 4.3 per cent owing to increase in various input costs.

"The weighted average price increase in ex-showroom Prices (Delhi) across models is 1.7 per cent. The new prices are effective from today," the auto major said in a regulatory filing.

MSI sells a range of cars from Alto to S-Cross priced between Rs 3.15 lakh and Rs 12.56 lakh, respectively.

The auto major has already hiked the vehicle prices three times last year by 1.4 per cent in January, 1.6 per cent in April and 1.9 per cent in September, taking the total quantum to 4.9 per cent.

Last month, the company had stated that it has been forced to hike prices due to the increase in cost of essential commodities like steel, aluminum, copper, plastic and precious metals over the last one year.

First Indian study provides evidence of Omicron's community transmission

 The study shows a steep increase in the daily progression of Omicron cases with its preponderance in the community, which was observed from 1.8% to 54%

Most of the Omicron variant infected patients of COVID-19 during the last week of December 2021 had no travel history, which indicates that there was eventual community transmission, according to the study conducted by the Department of Clinical Virology, Institute of Liver and Biliary Sciences, New Delhi.

"The respiratory specimen of all RT-PCR confirmed positive cases between November 25 -December 23, 2021, collected from five districts of Delhi were subjected to whole-genome sequencing. Complete demographic and clinical details were also recorded. Hence, we analysed the formation of local and familial clusters and eventual community transmission," the study noted.

The study also states that around 60.9 per cent of COVID-19 infected people showed a community spread.

"Out of the 264 cases during this study period, 68.9 per cent (n=182) were identified as Delta variant and its sub-lineages while 31.06 per cent (n=82) were Omicron variant with BA.1 as the predominant sub-lineage (73.1 per cent)," it further read.

It stated that most of the Omicron cases were asymptomatic (n=50.61 per cent) and did not require any hospitalizations.

"A total of 72 (87.8 per cent) cases were fully vaccinated. Around 39.1 per cent (n=32) had a history of travel or contacts while 60.9 per cent (n=50) showed a community transmission," it added.

The study shows a steep increase in the daily progression of Omicron cases with its preponderance in the community, which was observed from 1.8 per cent to 54 per cent.

As per the interpretation of the study, this is among the first from India to provide the evidence of community transmission of Omicron of coronavirus infection with significantly increased breakthrough infections, decreased hospitalization rates, and a lower rate of symptomatic infections among individuals with high seropositivity against SARS-CoV-2 infections.

All iPhone 14 models to feature 120Hz displays, 6GB RAM: Report

 Apple is expected to announce the iPhone 14 series in or around September and now a new report suggests that all four iPhone 14 models would sport 120 Hz screens, not just the two Pro devices.

Apple is expected to announce the iPhone 14 series in or around September and now a new report suggests that all four iPhone 14 models would sport 120 Hz screens, not just the two Pro devices.

According to a research note by analyst Jeff Pu for Haitong International Securities, all four iPhone 14 models will also have the exact same RAM amount: 6GB. This too is in contrast to the current situation, where the iPhone 13 mini and iPhone 13 have 4GB, while the Pro and Pro Max have 6GB, reports GSMArena.

Recently, Apple analyst Ming-Chi Kuo also claimed that the 2022 iPhone 14 Pro and 14 Pro Max would be shifting over to a hole-punch cutout for the camera.

Apple has reportedly advised major US carriers to prepare for the launch of eSIM-only smartphones by September this year.

It is possible that Apple might remove the physical SIM card slot starting with some iPhone 14 models, rather than some iPhone 15 models as originally rumoured.

It is also said that there will be support for two eSIM cards, ensuring dual SIM functionality. The removal of the SIM card slot could further improve water resistance.

The next flagship series, the iPhone 14 line-up, will come with up to 2 TB of storage.

Apple will adopt QLC flash storage for next year's iPhone and that, thanks to the newer storage technology, it will increase capacity to 2 TB.

Philippines gives $374-mn contract to BrahMos Aerospace to supply missiles

 Under the deal negotiated, Brahmos Aerospace Private Ltd will deliver three batteries, train operators and maintainers, and provide logistics support, Defence Secretary Delfin Lorenzana said

The Philippines has given a $374-million contract to BrahMos Aerospace to supply shore-based anti-ship missiles for the country's navy, military sources said.

BrahMos Aerospace, an India-Russian joint venture, produces the supersonic cruise missile 'BrahMos' that can be launched from submarines, ships, aircraft, or from land platforms.
The company had proposed to the Philippines government for supply of shore-based anti-ship missiles for the country's navy, sources mentioned.

Its proposal worth $374 million was accepted last month by the government, they added.

India has already deployed a sizable number of the Brahmos missiles and other key assets in several strategic locations along the Line of Actual Control with China in Ladakh and Arunachal Pradesh.

The Philippines is in the late stages of a five-year, 300 billion pesos ($5.85 billion) project to modernise its military's outdated hardware that includes warships from World War Two and helicopters used by the United States in the Vietnam War.

Under the deal negotiated with the government of India, Brahmos Aerospace Private Ltd will deliver three batteries, train operators and maintainers, and provide logistics support, Defence Secretary Delfin Lorenzana said in a Facebook post late on Friday.

What does the future of 'work' look like?

 Pandemic has led to a seismic shift in how we work and forced businesses to adapt to new realities. So, what the future of work will be like, will it be more flexible? Let's try to find out

India’s biggest FMCG company Hindustan Unilever last month introduced a new flexible work model for its employees in a bid to challenge the traditional work structures. About 8,000 of its office-based staff are eligible to apply for this. The scheme gives employees a flexible association with the company and yet provides financial, security, retirement, and medical benefits.

The workers get a monthly retainer and in addition, they get paid for each assignment they work on. And between assignments, they are free to do other things that are important to them. The company gains by having ready access to skilled people who can hit the ground running.

Employees today are increasingly putting their families before work after having spent two years working from their homes and native places. They want to experience an improved work/life balance. And employers have come to realize that flexibility should no longer be viewed as a privilege but be made available to all workers.

In India, companies are once again re-adapting to work from home. This time with much relative ease. They wanted to get people back to offices in a hybrid model where they visit the office only a few days a week, at least for tech and other office-based roles.

But there is still some pushback to this idea.

A long-term solution for this is offering flexible work where employees can work from anywhere permanently and make office visits only on certain occasions. This also broadens the talent pool for hiring. But a common complaint that companies have is that it makes it harder for them to maintain and reinforce their company culture.

S Korea's LG Energy Solution plans US battery JV with Honda: Report

 The potential battery JV between LGES and Honda could cost as much as 4 trillion won ($3.4 billion) and have an annual production capacity of up to 40 gigawatt-hours (GWh) of batteries

South Korean battery maker LG Energy Solution (LGES) plans to build a battery joint venture (JV) with Japan's Honda Motor Co Ltd in the United States, South Korea's Maeil Business Newspaper said on Friday, citing an unnamed industry source.

The potential battery JV between LGES and Honda could cost as much as 4 trillion won ($3.4 billion) and have an annual production capacity of up to 40-gigawatt hours (GWh) of batteries, enough to power 600,000 electric vehicles (EVs), the newspaper reported. The report did not have details, such as the timeline of when the JV would be built and begin operations.

LGES, LG Chem Ltd's battery subsidiary, commands more than 20% of the global EV battery market and supplies Tesla Inc, General Motors Co, and Volkswagen AG among others.
"We are discussing various ways to cooperate with automakers, including establishing joint ventures, but nothing has been decided," LGES said in a statement.

A Honda USA spokeswoman declined to comment on the story.

"This is not something that Honda has announced. We cannot comment on speculation," said a spokesperson at Honda in Tokyo.

Honda and its alliance partner GM plan to introduce two jointly developed large-sized EV models in North America, using GM's Ultrium batteries, in 2024. GM will make Ultium batteries under a JV with LG.

Indian mobility tech startup EVage raises $28 mn from US-based VC firm

 EVage on Friday said it has raised $28 million from US-based venture capital firm RedBlue Capital.

Indian all-electric commercial original equipment manufacturer (OEM) EVage on Friday said it has raised $28 million from US-based venture capital firm RedBlue Capital.

Founded in 2014, Evage in India is supplying EV trucks to major delivery fleets such as Amazon India's Delivery Service Partner.

The seed-round funding will help the mobility tech startup complete its production-ready factory outside of Delhi in FY2022-23 and scale-up production said the startup.

"When we pioneered our highly adaptive and modular multi-vehicle platform in 2014, it was a journey into the unknown. The success of new global OEMs and their impact on electrifying transport in the US and Europe is a testament to what we can do in India and other price-sensitive countries," said Inderveer Singh, Founder, and CEO, EVage.

EVage has developed a platform for industry-ready electric vehicles that exceed the quality of comparable options available in India and other emerging markets at a far lower cost basis, passing on the significant total cost of ownership (TCO) savings to its customers.

EVage said it will manufacture vehicles in 'Modular Micro Manufacturing' factories with smaller footprints and fewer capital requirements than traditional automotive OEMs.

EVage's first vehicle, the Model. X is a one-tonne truck designed for the commercial delivery vehicle market and is undergoing a seismic shift towards electrification.

Has IPO-bound travel tech major OYO regained trust of its hotel partners?

 As OYO prepares for its public listing, the continued satisfaction of its hotel partners and winning back dissatisfied partners will play a key role in determining how its business performs.

As travel tech major OYO prepares for its much-awaited public listing, the continued satisfaction of its hotel partners and winning back dissatisfied partners will play a key role in determining how its business performs and, by extension, how its stock holds up.

The company has recently been affected by some of its hotel partners publicly complaining, filing cases, and even writing to the regulator.

The moot question here is: Has IPO-bound OYO regained the trust of its hotel partners which it also addresses as Patrons?

Let's take a closer look at its patron policies through its draft red herring prospectus (DRHP) filed with SEBI.

With over 157,000 storefronts worldwide, the 40 reported cases against the company or its directors translate to less than 0.02 percent of its storefronts. OYO sources say that majorly of these originate due to shifting from minimum guarantee to revenue sharing arrangement. As per DRHP, at its peak, 14.7 percent of hotels had a minimum guarantee. This number is down to nearly zero now.

After bingeing on growth and expansion, the company seems to have refocused its priority to course correct on the hotel partner front.

Revenue growth is by far the biggest and most meaningful value proposition that OYO claims to provide its hotel partners worldwide. Its DRHP tries to prove it by showing the median revenue growth for a storefront after 12 weeks of a hotel joining the OYO platform.

The highest revenue uplift for storefronts is in the European Vacation Homes Business at 2.4 times, while India is still at a healthy 1.9 times increase in revenue.

Amazon brand startup Thrasio to invest $500 for India e-commerce expansion

 The company and its peers buy out small merchants and plan to use their retail expertise to turn the acquisitions into global brands.

Thrasio Holdings Inc., an aggregator of private brands on Amazon.com Inc., is setting aside more than $500 million for an expansion in India to target one of the world’s fastest-growing e-commerce markets.

The Walpole, Massachusetts-based startup said it acquired consumer goods company Lifelong Online to commence the push, without disclosing the value. Lifelong’s product categories include kitchen, home, lifestyle, and health care, Thrasio said in a statement Friday.

Thrasio, backed by Silver Lake, is one of a slew of startups looking to capitalize on Amazon’s e-commerce dominance by acquiring up-and-coming sellers on the company’s third-party marketplace. Thrasio and its peers buy out small merchants, sometimes mom-and-pop operations run out of garages, and plan to use their retail expertise to turn the acquisitions into global brands.

“In addition to acquiring and growing digital-first businesses, we plan to participate in the ‘make in India’ movement by transitioning the manufacturing for some of our products to the country,” Carlos Cashman, Thrasio’s chief executive officer, said in the statement.

Thrasio has acquired more than 200 brands and raised over $3.4 billion in capital and plans to continue expanding globally. The startup’s rivals include Mensa Brands, backed by Tiger Global and Accel, and SoftBank Group Corp.-backed GlobalBees Brands.

TVS Motor Company, Swiggy join hands for food delivery on electric vehicles

 TVS said in a statement that the partnership highlights its commitment to strengthening electrification across diverse mobility segments

TVS Motor Company, the flagship company of $8.5 billion TVS Group, and food delivery major Swiggy have entered into a strategic partnership to use TVS Motor’s electric vehicles for food delivery and other on-demand services, and other sustainable initiatives.

Last year, Softbank-backed Swiggy had announced that it was planning to cover deliveries spanning 800,000 kilometers every day through EVs by 2025. It had also signed a deal with Reliance BP Mobility Ltd (RBML) to build an EV ecosystem and battery-swapping stations for its delivery partners and also joined hands with e-cycle maker Hero Lectro to come up with end-to-end delivery of Swiggy orders through cargo e-cycles. Trials in this regard are currently going on in Bengaluru, New Delhi, and Hyderabad.

TVS said in a statement that the partnership highlights its commitment to strengthening electrification across diverse mobility segments and is in line with Swiggy’s many efforts to enable the adoption of EVs in its delivery fleet. As part of the MoU, TVS Motor and Swiggy will test the implementation of TVS Motor’s EV for food delivery and other on-demand services of Swiggy.

The two companies are also exploring the co-creation of sustainable and comprehensive solutions for Swiggy’s delivery partners. This will include working on customized packages like a need-specific product, flexible financing options and, connected services. Notably, the pilot will play a vital role in the adoption of EVs in food delivery and on-demand delivery services.

“TVS Motor Company has been at the forefront of delivering green and connected vehicles to our customers. Our collaboration with Swiggy is a key step towards strengthening the electrification of mobility in food delivery and last-mile delivery services, furthering the easy adoption of EVs amongst customers," said Manu Saxena, senior vice president – Future Mobility, TVS Motor Company.

Health-tech company HCAH raises Rs 112 cr from ABC World Asia

 HCAH will use this investment to build a presence in physical rehabilitation and recovery space through its service range of home ICU, in-patient rehab in transition care centers, digital and home rehab

Health-tech company HealthCare at home (HCAH) has raised Rs 112 crore from ABC World Asia (“ABC”), a Singapore-based impact-focused private equity fund. HCAH is backed by the Burman family, Quadria Capital, and Founders of Healthcare at Home UK.

HCAH will use this investment to build its presence in the physical rehabilitation and recovery through its service range of Home ICU, Inpatient rehab in transition care centers, digital and home rehab; and rehab equipment, elderly care services including long term nursing, palliative, and attendant care services and Chronic Disease Management services including screening, diagnostics, patient support, adherence programs in association with leading pharma companies. All these services are delivered through HCAH’s proprietary technology platform in homes, centers, and digitally.

Vivek Srivastava, Co-Founder, and CEO, HCAH said, “The out-of-hospital care model is witnessing rapid growth as more and more countries are leveraging the model to deliver best in class health outcomes, and quality of life. Our solution delivers better outcomes at a lower cost while increasing access by the use of data and technology."

"The investment from ABC is a significant step for the out-of-hospital care segment in India and will allow HCAH to build 1,500 beds in transition care and long-term care focused on physical rehabilitation and recovery, and long-term care for elderly," added Srivastava.

HCAH has handled nearly 1,000,000 patients with an almost 97% recovery rate during the pandemic and worked closely with the Government of Delhi, Punjab, and Karnataka to deliver services at scale, said the company in a statement.

Equity MFs see net inflows of Rs 25K crore in December, shows data

 Tally for 2021 rises to Rs 97,000 cr; monthly SIP contributions rise to Rs 11,305 cr

Equity mutual funds (MFs) ended 2021 on a strong note seeing record net inflows of Rs 25,076.71 crore in December, taking the net inflows for the year to Rs 96,669.97 crore, according to data from the Association of Mutual Funds in India (Amfi).

Inflows through the systematic investment plan (SIP) route for December stood at Rs 11,305.34 crore, as against a monthly SIP contribution of Rs 11,004.94 crore in November.

Market players say Indian investors have continued to repose faith in equity funds and inflows were high also because of the new fund offers (NFOs) brought out by many fund houses. In December, fund houses launched six equity-oriented schemes, collecting Rs 12,446 crore. Three multi-cap schemes saw collections of Rs 9,509 crore, while other three thematic funds collected Rs 2,937 crore.

Sunil Subramaniam, managing director of Sundaram MF, says, “I think the Omicron variant of Covid-19 is a worry for foreign investors. Domestically, even though Omicron cases are on the rise, people have seen how Covid-19 has been tackled in the last two waves and how the economy has recovered, which is giving them the confidence to invest in equities.”

In December, the benchmark Sensex rose around 2 per cent and in the last one year the index has surged nearly 24 per cent. Officials in the industry feel the overall flows into SIPs will remain strong in 2022 as well, but there could be some profit booking by investors.

India INX members can now access Moscow Exchange via GIFT City

 The partnership will create a cost-effective bridge for Indian investors to access trading on the Moscow Exchange

Sova Capital, a London-based emerging markets broker-dealer, on Monday said it has concluded a pact whereby it will offer members of India INX and their client's access to the Russian market.

The partnership will create a cost-effective bridge for Indian investors to access trading on the Moscow Exchange (MOEX), Russia's main trading venue for equities, bonds, derivatives, forex, and money markets, according to a statement.

India INX Global Access IFSC Ltd, which is a wholly-owned subsidiary of the BSE's India INX, has launched a platform through which Indian clients can trade foreign stocks. It is India's first international exchange set up at GIFT IFSC.

The tie-up with Sova Capital, an international clearing member of MOEX, will provide an outbound connection to all India INX members and their clients to access all instruments on MOEX and trade the global markets directly from India.

Now, AAAR rules ready-to-eat fryums papad to draw 18% GST

 GST rate is based on the classification of products based on the harmonized system of nomenclature (HSN) codes

Deciding the goods and services tax rate on fryums papad could be a messy affair with the Appellate Authority for Advance Rulings (AAAR) of Gujarat now ruling that the ready-to-eat product would draw an 18 per cent rate.

In that connection, it slightly modified the ruling of the state-based Authority for Advance Rulings (AAR). The AAR had also ordered that these products would draw 18 per cent GST but under a different classification.

Earlier in two different cases, Gujarat AAAR had ruled that fryums would be exempt from GST.

In the present case, Alisha Gruh Udyog, engaged in selling ready-to-eat fryums, had submitted in its petition that it is a settled legal case that fryums would not attract any GST.

GST rate is based on the classification of products based on the harmonized system of nomenclature (HSN) codes.

AAR agreed with the GST authorities' view that these fryums merit classification under the HSN code 2106, which attracts 18 per cent GST.

The petitioner had, however, argued that its product should come under the 1905 HSN code which draws nil GST.

AAAR observed that HSN 2106 includes sweets and namkeens. Fryums, it agreed, should come under HSN 1905. However, it did not agree with the petitioner that it would come under the entry 96 of 1905, which includes papad. AAAR ruled that this entry is for those papad products that are in ready-to-cook condition and require roasting or frying before consumption.

However, petitioner's products are available in ready-to-eat condition — fried fryums with masala, packed in small packets and do not require any further process of roasting or frying because these are already fried with masala and can be served for consumption immediately.

How can investors benefit from putting their money in silver?

 While gold has a negative correlation with stocks, silver usually works the other way round. So, does an investment in silver bode well for the retail investor in current times? Let's find out

ICICI Prudential Mutual Fund and Nippon India Mutual Fund are tapping into the latent demand for silver investments, with the recent launch of their silver exchange-traded funds (ETFs) and fund of fund (FoF).
Other fund houses like DSP, HDFC, and Mirae Asset will soon come out with their offerings too. So, does an investment in silver bode well for the retail investor in current times?
Analysts say yes, pointing to the metal’s low but positive correlation with equities. Chirag Mehta, senior fund manager-alternative investments at Quantum Mutual Fund, told Business Standard that around 70 percent of silver’s usage comes from industrial applications. When economic growth is high, rising demand pushes its price up.
So, while gold has a negative correlation with stocks, silver is more likely to work the other way around.
While silver has declined 12.5% over the past year, experts expect it to begin performing again in the coming few months. The metal is trading at around Rs 60,000 per kg in key metro cities, but Naveen Mathur, director-commodities and currencies, Anand Rathi Shares, and Stock Brokers told Business Standard that the metal could reach a price of around Rs 67,000 in the coming few months.

In the last decade, gold has definitely outperformed silver in terms of returns.
So, experts suggest only considering silver investments as one option in a basket of commodities. For those considering investing only in silver, experts suggest having a 10-year plus horizon. Business Standard’s Sanjay Kumar Singh explains more.

What will guide the markets sentiment in the next few days?

 Equity markets are beginning to turn volatile as profit-making at higher levels is capping the upsides. Let's look at the key events that will guide the sentiment and trading strategies for investors

Equity markets have kick-started the calendar year 2022 in a buoyant mood. Despite the lingering Omicron threat, which is sweeping across economies globally, world stocks managed to end the previous week in the positive zone.
Bulls took charge with renewed zest last week, but some trepidation was observed in the mid-week as markets interpreted the Fed’s hawkish policy minutes.
Given this, benchmark indices staged an over 1.5 percent rally last week, with the BSE Sensex and the Nifty50 parked at 59,745 and 17,813 levels, respectively.
In the broader markets, the BSE MidCap and SmallCap indices gained about 2 per cent and 1.5 per cent, respectively.
That said, market moves may be slightly erratic from here on as quarterly results begin to pour in.
Over 40 companies will report their December quarterly figures this week, including IT majors TCS, Infosys, and HCL Tech, and banking giant HDFC Bank.
In recent weeks, Indian IT stocks have outpaced the benchmark, fuelled by expectations of an increase in deals and a resultant stellar growth momentum.
Thus, margin projection, revenue guidance, and attrition figures will be monitored during the earnings announcement.
As regards banks, green shoots have appeared, with 10 out of 13 banks reporting double-digit loan growth as per the Q3FY22 business update.
This has raised expectations of the earnings momentum of Q2FY22 continuing in Q3FY22.
That said, in light of recent developments surrounding the Omicron variant of Covid, it will be crucial to monitor management commentary on growth outlook and risk perspective.

What is the current state of Indian economy?

 With the worst most likely behind it, the bruised Indian economy looks poised to regain its vitality. We look at the current state of the Indian economy and how some key sectors are performing

The National Statistical Office (NSO) on Friday released the first advance estimates of National Income for 2021-22 to help the Union Finance Ministry in its annual budget-making exercise. Finance Minister Nirmala Sitharaman will table the Union budget on February 1 at 11 AM. The autonomous body in its estimates compiled using the Benchmark-Indicator method said that the GDP may grow at 9.2% in the financial year ending March 2022. It is a tad less than the RBI projection, which had pegged the GDP growth rate at 9.5% for the current financial year. Meanwhile, China is expected to grow by 8%. The estimates suggest that the Indian economy can come back to the level of FY20 in the absence of any strict lockdowns. However, the absolute growth in real GDP over FY20 would be a marginal 1.3%. This means that two years of growth had been lost to the pandemic. Nominal GDP is estimated to grow at 17.6% compared to a fall of 3% in FY21. It is better than the 14.4% growth used for FY22 Budget calculations last February. It means the government will have the benefit of a higher denominator as the annual fiscal deficit is looked at with respect to nominal GDP.

A higher growth rate for nominal GDP than budgeted will have a dampening impact on the fiscal deficit as a percentage of GDP. Assuming that all revenues remain the same as estimated in the last Union Budget, the government can overshoot its absolute deficit number by some Rs 71,000 crore without any change to its fiscal deficit target of 6.8% of GDP. However, the government is spending Rs 3.28 lakh crore over the Budget Estimate this fiscal. But given the buoyant tax revenues and expected savings from various departments, the government is in a comfortable position to rein in its fiscal deficit at 6.8%. Ultimately, all of this hinges on the government garnering an estimated Rs 1 lakh crore with LIC’s IPO. Manufacturing is likely to expand at 12.5% while construction may rise to 10.7%. Trade, hotel, transport, and communication, despite showing a high at 11.9% this year, have still not made up for output lost since FY20. The bad news is in private consumption. Its share in GDP is still lower than what it was two years ago. The share of consumer spending in FY22 GDP is projected to be 54.8%, compared with 56% in FY21 and 57.1% in FY20. In absolute terms, it is estimated to rise 6.9% though it is still below pre-Covid levels seen in FY20. This indicates that in spite of a strong recovery in 2021-22 from the contraction last fiscal year, consumption recovery is still not broad-based. Rising inflation does not bode well either. Meanwhile, investments have begun to pick up. According to the estimates, gross fixed capital formation’s contribution to real GDP is projected to be 32.9% in FY22, compared with 31.2% in FY21 and 32.5% in FY20. 

Samsung shuts down Tizen app store for both its new and existing users

 Samsung has shut down its Tizen app store for both its new and existing users.

Samsung has shut down its Tizen app store for both its new and existing users.

According to GSMArena, the company closed registrations and made the store available only to existing users and they could only get previously downloaded apps.

After December 31, 2021, the Tizen app store was permanently closed and Samsung Z series smartphone users were suggested to switch over to Android or iOS

Despite completely switching to Android for its phones and Wear OS for its smartwatches, Samsung recently unveiled its new smart TVs recently and they are still running Tizen OS.

Tizen OS for smart TVs is quite feature-rich and offers a collection of all popular audio and video streaming services.

It even integrates Samsung Health, SmartThings, Samsung TV Plus, and various other gaming features.

Is the Fairwork ratings on gig workers' condition a wake-up call?

 The gig economy made itself known during the pandemic. The recent Fairwork ratings highlighted how well or poorly these workers of unorganized sectors were being treated by companies. 

The ubiquitous foot-soldiers of India’s thriving internet economy are discontented. We’re talking about your Ola/ Uber cab drivers and Swiggy/ Zomato delivery partners. Some of them are now tasked with delivering your bread and milk in just 10 minutes! But as a recent report by the Fairwork Foundation, in collaboration with the Oxford Internet Institute has found the earnings of these app-based platform workers or gig workers in India have declined over the last two years. That’s owing to the withering of incentives offered by companies and a reduction in take-home earnings due to a surge in out-of-pocket expenses.
The Fairwork India Ratings 2021: Labour Standards in the Platform Economy, now in its third year of publication, serves as an indictment of the work conditions for this growing class of unorganized workers. This year, the report ranks 11 Indian startups which engage contract gig workers. It scores them out of 10, based on their performance against five principles, namely: Fair Pay, Fair Conditions, Fair Contracts, Fair Management, and Fair Representation.
Notably, Ola’s score has come down from 2/10 in 2020 to zero in 2021. This is, at a time, when it has become notoriously difficult to get a cab driver to accept your ride request on the Ola platform. Uber has also slipped from one to zero. And Urban Company, which topped the list in 2020 with a stellar score of 8/10, has slipped three points to five.
We reached out to Ola, Uber, and Urban Company to understand the reasons behind the fall in their scores, but didn’t receive any responses. So, we asked the lead investigator for Fairwork in India, Professor Balaji Parthasarathy.
The decline in Urban Company’s score has coincided with ongoing protests by its beauticians.

Foxconn India iPhone plant to reopen on January 12: Govt officials

 The Foxconn plant, located in the state of Tamil Nadu, was closed on Dec. 18 following protests over 250 of its workers being treated for food poisoning

Apple Inc supplier Foxconn will reopen an iPhone manufacturing facility in southern India on Wednesday with 500 workers, government officials and a legislator in the region where the plant is located told Reuters.

The Foxconn plant, in the town of Sriperumbudur near the Tamil Nadu state capital of Chennai, employed about 17,000 people but was closed on Dec. 18 after protests over 250 of its workers who fell sick with food poisoning.

Apple has since placed the factory on probation after discovering that some dormitories and dining rooms did not meet the required standards. Foxconn and Apple did not immediately respond to a request for comment. K Selvaperunthagai, a member of the state assembly for the area, said the Tamil Nadu Chief Minister M K Stalin told the assembly late on Friday the plant would reopen on Wednesday with 500 workers.

Government officials have said Foxconn intended to resume production gradually but have not said when the full workforce would be back on the job. Foxconn has been making the iPhone 12 and testing production of the iPhone 13 at the Sriperumbudur facility, its only plant in India, government officials have said. Apple has eight other suppliers in India.

Selvaperunthagai told Reuters the state government would build a hostel facility with a capacity to house tens of thousands of workers from various industries to address the concerns about standards of dormitories and dining facilities. "The government is clear that they don't want such incidents to happen again," he said.

Tamil Nadu, a state of more than 70 million people and one of the country's most industrialized, is sometimes called the "Detroit of Asia". It is home to factories of companies including BMW, Daimler, Hyundai, Nissan, and Renault.

Ashneer Grover case: Kotak Mahindra Bank pursuing appropriate legal action

 The legal notice sent by Grover and the response of the private lender assumes significance after an audio recording was shared on social media platform Twitter

Private sector lender Kotak Mahindra Bank on Sunday said it is pursuing appropriate legal action in the Ashneer Grover case. Grover is co-founder and managing director (MD) of Bharat Pe, who had sent a legal notice to the bank on October 30, 2021, for allegedly failing to provide initial public offering (IPO) financing in the IPO of FSN E-Commerce Ventures Ltd, or Nykaa, and to allocate its shares in the HNI/NII category.

The bank in a statement said, “The (legal) notice was received by us and was replied to appropriately at the time, including placing on record our objections to inappropriate language used by Mr. Grover. Appropriate legal action is being pursued. We would like to confirm that there is no breach or violation by the Kotak Group in any manner whatsoever”.

The legal notice sent by Ashneer Grover and the response of the private lender assumes significance after an audio recording was shared on social media platform Twitter in which Grover was allegedly heard using derogatory language against an empl­oyee of the bank.

Grover later claimed that the audio clip was fake. In the legal notice sent to the bank, Grover’s law firm had said, “…to the shock and surprise of our clients, on 28 October 2021, after having repeatedly assured our clients that the shares of FSN would be allo­tted to them, Kotak informed our clients that it would not be able to provide IPO financing for the Nykaa IPO”.

Will Q3 earnings negatively surprise Dalal Street?

 With over 40 companies set to announce their report cards next week, listen to market analysts Devangshu Datta and Sandip Sabharwal, to understand how the results season may pan out

Global equities witnessed their first bout of selling in the calendar year 2022 yesterday, after minutes of the US Federal Reserve’s last policy meeting pointed at earlier and faster rate hikes, uncovering “a more hawkish Fed than some may have expected”.
That apart, over 90,000 fresh cases of Covid-19 back home also soured sentiment on Dalal Street.
The frontline S&P BSE Sensex declined over 900 points intra-day but, eventually, settled 621 points lower at 59,602.
The NSE Nifty, on the other hand, ended at 17,746, down 179 points.
Markets had been on an upswing during the past four sessions, after consolidating during the last few months of CY2021.
However, analysts expect volatility to return to the Street next week as India Inc kicks off Q3 earnings season.
As many as 45 companies are set to report their December quarter results in the coming week including Infosys, Wipro, TCS, Mindtree, HCL Tech, and HDFC Bank.
According to Devangshu Datta, an independent market expert, the October to December period will be a “transitionary phase” for the global economy, including India, as inflation is at a multi-year high, commodity prices are up, the US economy is apparently growing at a rapid pace, the base effect is ebbing in India, and China is cutting down on high carbon industries.
For Sandip Sabharwal, founder of asksandipsabharwal.com, high input costs may lead to a miss on earnings expectations.

What lessons does Elizabeth Holmes' fall have for startup investors?

 Billionaire Elizabeth Holmes, the founder of Theranos, has been found guilty of defrauding investors. What lessons does the Homes-saga hold for startup investors back home, this report finds out

This week, Theranos founder Elizabeth Holmes was charged with defrauding investors. Holmes now faces at least 20 years in prison.

The way she established and sold her startup story offers valuable lessons to investors across the globe now. Even to Rupert Murdoch, one of the investors who believed in her idea.

Startups can command hefty valuations, very quickly. As venture capital and private equity firms in the US Silicon Valley place a premium on ideas that promise disruptive innovation, new-age tech companies can raise millions of dollars in funds, even before coming up with a product-market fit, or in some cases, even a workable prototype.

However, in this glitzy world of innovations and disruptions that are waiting to happen, some founders, like Holmes, are spinning a web of lies and charting their path to success by leveraging the greed of investors. They exemplify the “fake it till you make it” philosophy.

Theranos was founded by Holmes, a Stanford chemical engineering drop out when she was 19 years old. It was once valued at over $9 bn.

And how did she pull it off?

Holmes claimed to have developed tests that could help in the early detection of ailments ranging from high cholesterol and high blood sugar to liver dysfunction and cancer from just a couple of drops of blood drawn from a finger prick at any pharmacy.

The small amount of blood was collected in a container tube and analyzed in a Theranos lab on a proprietary analysis machine called “Edison”.

The “invention” was believed to have the potential to revolutionize healthcare and slash diagnostic costs. That was until it came to light that Theranos’ Edison machines weren’t providing accurate results.

The company knew this. So it was diluting blood samples and subjecting them to “traditional tests”, instead of using its famed Edison machines.

US-based fund TFCC tops India's PE fund investor list of 2021

 The top ten fund managers who run the PE funds have collectively invested over $12.18 billion

In a ranking of the top ten fund managers of PE funds last year, US-based fund TFCC came out on top in terms of the money invested here, according to research by VCCEdge which tracks private equity investments.

In December, TFCC acquired a 46 percent stake in little-known Chennai-based Ramcharan which is currently in chemicals distribution. However, it will now invest in the environment, energy management systems, and renewable energy system devices.

This catapulted TFCC to the top of the list with investments of $4.1 billion. For TFCC, which has a portfolio of $20 billion invested in South Asia, this was its first foray in India.

The top ten fund managers who run the PE funds have collectively invested over $12.18 billion. This accounts for around a fifth of the total investments for which public announcements on the specifics have been made by PE players in the country last year.

As VCCEdge’s study was based on what fund managers of these various funds had invested in the country, many PE groups such as Blackstone, which has numerous companies and funds under management, have three of its funds featuring in the top ten.

In second place is the CPP Investment Board, a global investment management organization that invests the assets of the Canadian Pension Plan. With a fund size of $541.5 billion, CPP has invested in multiple projects. To mention just two, it has invested $257 million in the infrastructure investment trust set up by the National Highways Authority of India for the acquisition of brownfield road projects and $800 million in Flipkart, its largest investment in 2021.

PE inflows spurt 15% in 2021 to record $40 billion, says report

 According to the data collated by Refinitiv, an LSEG business, while the value of inflows rose 15.2 percent from USD 34.8 billion in 2020 to USD 40.1 billion in 2021

Private equity investments hit a record high of USD 40.1 billion in 2021, an increase of over 15 percent from the previous year, led by a USD 3.6 billion flow into Flipkart and USD 1.93 billion into Bundl Technologies, as per a report.

According to the data collated by Refinitiv, an LSEG business, while the value of inflows rose 15.2 percent from USD 34.8 billion in 2020 to USD 40.1 billion in 2021, the deal volume soared to 990 in the reporting year from 588 in 2020.

Analysts at the agency expect the inflow momentum to continue in 2022 as technology companies, especially startups, continue to attract capital from both private and public markets.

They also expect healthcare, financial services, consumer-related, and education services, which are ripe for digitalization and remained resilient during the pandemic, to continue to attract investors moving into 2022 as substantial capital is waiting to be deployed by India-focused funds.

The buoyant secondary markets and record primary listings in 2021 were other reasons for the spike in inflows, driving up confidence in the capital market, providing a conducive environment for companies to go public, and offering investors a viable exit, they said.

Internet-specific companies attracted maximum PE interest in 2021 with their total investments scaling to USD 20.74 billion from a low USD 7.6 million in 2020.

Meanwhile, fundraising by domestic/India-focused PEs rose to USD 4.72 billion, a marginal 5 percent growth over USD 4.5 billion in 2020.

According to Refinitive, the top 10 PE deals of the year were the USD 3.6 billion raised by Flipkart, Bundl Technologies (USD 1.925 billion), Think & Learn (USD 1.76 billion), Blinkit India (USD 1.4 billion), Sporta Technologies (USD 1.1 billion), Axelia Solutions (USD 1.04 billion), Mohalla Tech (USD 912.3 million), Meesho Payments (USD 870 million), Zomato (USD 798.14 million) and Pine Labs (USD 700 million).

Jet Airways 2.0 faces turbulence before take-off?

 The acting CEO of Jet Airways quit this week. The date to seek regulatory permissions for restarting the airline has also been extended twice. Why is the re-launch of Jet Airways looking turbulent?

Waiting in the wings since April 2019 -- when it was grounded due to a financial crisis -- Jet Airways has been looking to hit the skies for a long now. The new owners, British firm Kalrock Capital and UAE-based entrepreneur Murari Lal Jalan, have time and again asserted that Jet Airways 2.0 will take off at the beginning of this year.

But will everything go as planned? The company has recently seen a slew of resignations. This week, Sudhir Gaur, its accountable manager, and acting chief executive de-boarded the company.

Gaur was heading the operations team and was involved in key negotiations for airport slots. The airline’s finance head and head of management information systems had quit two weeks ago.

We reached out to Jet Airways for their stance on the recent developments but didn’t receive a response by the time of publishing this video.

While Gaur’s replacement has been found in the head of training and standards in Nepal Airlines, PP Singh, there are several other tasks to complete before Jet Airways 2.0 can take off.

The Kalrock-Jalan consortium is yet to finalize its fleet plans. Jet Airways 2.0 is understood to have a fleet of 11 aircraft, including Boeing 777, 737, and Airbus A330, on its books now.

The two company owners had said that the airline would commence domestic operations with six narrow-body aircraft in 2022. And also that the airline plans to have a fleet of 100-plus aircraft.

FMCG distributors call off stir against Colgate-Palmolive after talks

 Will gauge the price parity situation on the ground for the next 3 months

Distributors in Maharashtra have decided to resume the supply of Colgate-Palmolive India (Colgate India) products after the company gave an assurance to correct the issue of price parity on the ground between the traditional trade and organized distribution channel.

The All India Consumer Products Distributors Federation (AICPDF) has decided to see if there are any changes on the ground over the next three months and will decide the future course of action accordingly. This strategy by distributors is the same as that used in the case of Hindustan Unilever. Distributors have also been asked to communicate any issues of price disparity with proof.

“On January 5, 2022, Colgate (India) invited the federation’s office bearers to discuss (the issue of price disparity) with the company’s high ranking officials,” AICPDF said in a statement. “A six-member committee of the federation informed Colgate India about the problems faced by the distributor fraternity due to B2B players (selling the stock at higher margins to retailers),” the statement added.

AICPDF also said that the company’s executives assured the federation that they consider their distributors to be an important component of their distribution system and that the company will take serious decisions on how to protect their interests. If something goes wrong in the market, the distributors should feel free to launch their complaint via an e-mail id given by Colgate India officials.

Will Omicron deal another blow to India's wedding industry?

 The new Covid-19 variant is threatening to spoil the wedding industry's party again, at a time when it looked all set to recover its previous losses. Here's how Omicron may hit the wedding industry

But when it became evident that Covid-19 was here to stay, Zoom weddings and intimate ceremonies -- with just family members and close friends -- became the trend. This obviously was not good news for the vibrant marriage industry in India.

It suffered huge losses. And there was no word on lakhs of workers employed in the unorganized sector in small cities and towns. More than a year later, and after bracing two coronavirus waves, the sector was finally finding its feet.

Big fat Indian weddings were back towards the end of last year with families splurging the money saved up during the pandemic.

Our Instagram feeds were filled with pictures of friends either getting married or attending a marriage. The wedding business was returning to normalcy. Such was the rush that venues were booked months ahead and hotels were charging a premium for some auspicious dates.

But it all seems to have come to a standstill again, with the onset of Omicron. States including Maharashtra, West Bengal, and Tamil Nadu have limited the number of guests that can attend a wedding.

Rajasthan, a popular destination for extravagant marriages, has capped the number of wedding guests at 100.

The government in Delhi, one of India’s biggest wedding markets, has curtailed the number of guests at a wedding to a mere 20. It also went one step further and ordered weddings to be held only in a court or at home, dealing a huge blow to hotels and banquet halls.

What is the difference between privatisation and disinvestment?

 Loss-making national carrier Air India was privatized last year. And the government is going ahead with LIC disinvestment this year. Find out the difference between these two terms

The government sold Air India to the Tata group for Rs 18,000 crore last year. It got just 15% of the total amount while the rest went to the debtors. The Centre had been trying to offload its entire stake in the airline for years.

And after the nod of the Cabinet Committee on Economic Affairs, the government is now taking LIC to the primary market to divest some of its stakes. The government says that it just wants to go for an IPO and not for privatization.

We have also heard our Prime Minister Narendra Modi saying that “The government has no business being in business”. So the government’s intentions on privatization and disinvestment are very clear. But are these two terms different?

Let us start with disinvestment. It means the government or an organization is liquidating or selling its stake in a company. But it will be less than 50% and the government or the organization will still be in the saddle, calling the shots.

Governments often take this step to reduce their financial burden and re-allocate resources into other productive areas within a government-funded project or an organization.

It lowers the government's fiscal burden and provides funds for growth-oriented programs and development.

In 1999, the Indian government set up a separate department of disinvestment, which is today known as the Department of Investment and Public Asset Management or DIPAM. It operates under the Ministry of Finance.

The government announces its targets for disinvestment each year during the Union Budget. For the ongoing fiscal year FY22, the government has set a disinvestment target of Rs 1.75 lakh crore. The plan includes privatization of two public sector banks, public listing of the Life Insurance Corporation of India, Shipping Corporation of India, and many other PSUs.