Byju Raveendran lost interim control of the company after NCLT admitted the BCCI petition for insolvency over outstanding dues. Pankaj Srivastava was appointed interim resolution professional (IRP) to oversee the process. The next step will be to constitute a Committee of Creditors (COC) after collation of claims against Byju’s. The NCLT rejected Byju’s request for arbitration and deemed it a fit case for insolvency proceedings. Raveendran effectively loses control, debt payouts are on freeze and assets cannot be sold.
FPI flows into the fully accessible route (FAR) bonds crossed $1 billion (Rs8,740 crore) in just 19 days since the government securities were included in the JP Morgan index on 28-June. These are largely funds that were poured by index funds and index ETFs into these index eligible bonds. These flows are now expected to accelerate in the coming weeks. That also means that bond yields could soften in the coming weeks and that could attract further inflows into these bonds. The 10-year benchmark now trades at 6.96% yield.
Things are just getting operationally tougher for Asian Paints as the company reported 25% fall in net profits to Rs1,170 crore in Q1FY25. Even revenues fell by 2% at Rs8,970 crore; lower than street estimates. In the last few quarters, Asian Paints has been under pressure due to big guns like the Birla and JSW group foraying into the paints segment. In addition, higher crude prices and tough competition have put stress on the margins of APIL. Recent months saw tepid demand on general elections and a prolonged summer.
Call it the Ola effect; but Google is slashing the pricing of Google Maps by nearly 70% effective from August 2024. Ola had recently migrated to its proprietary Ola Maps to save on the huge licensing fees it was paying for using Google Maps. Google maps has been at the core of location based digital solutions, largely in ecommerce delivery, online food, online cab syndication etc. Ola has been offering mapping solutions via its AI-based Krutrim. Clearly, Google does not want to lose on this valuable location franchise in India.
Going ahead, SEBI has announced that stock exchanges and other market infrastructure institutions (MII) like depositories and clearing corporations will be independently evaluated on 8 key parameters. Based on these parameters, SEBI will review their performance and suggest ways to improve governance. The parameters will include activeness as first-level regulators, lowering compliance costs, reasonable fee, information sharing with regulators etc. The biggest weight will be for supervision and risk management.
According to reports, India’s actual food subsidies in FY25 may cost 11% more than the estimates in the interim budget. The full budget is expected to be presented by Nirmala Sitharaman on July 23, 2024. The food subsidy bill in the full budget is likely to be pegged at Rs2.25 trillion while the fertilizers subsidy bill is likely to be pegged at Rs1.63 trillion. The combined subsidy bill would be 5% higher. The spike in food subsidy bill is on account of higher MSP offered to farmers for rice and wheat. It will not impact the GFD.
Even as memes continue to invade the social platforms, Swiggy and Zomato have decided to hike platform fees by another Rs10-15 for restaurants. This would, obviously, be passed on to the end customer. The 2 leading food and delivery aggregators (Swiggy and Zomato) have been up against rising operating costs. In the past, several restaurants had planned to have their own distribution channels, but that is easier said that done, unless you have the clout of Domino’s. Loyal customers may not feel the pinch too much.
SEBI has recently proposed a new high risk asset class that would be positioned for investors somewhere between traditional mutual funds and PMS schemes. This could open up the opportunity to introduce differentiated risk-based ETFs, smart beta funds and leveraged ETFs. These are not too common in India, but with a new asset class permitted, they should gain traction. Globally, the idea is to offer a wide palate of options to investors and let them choose. This new asset class will have Rs10 lakhs as minimum outlay.