1. G20 nations may agree on definition of start-ups to ease policymaking
The G20 is expected to agree on a common definition for startups by July. The foundation and alliances working group under the Startup-20 Engagement Group, created during India’s G20 presidency, is leading discussions to establish consistent terminology across member nations to define investments, funding, and other related terms for startups in the ecosystem. India’s department for promotion of industry and internal trade defines a startup as an entity up to 10 years from its incorporation date, with sales of less than Rs 100 crore in any financial year. There are over 97,000 recognized startups in India.
Why it’s important: A common definition would enable effective policymaking across member countries, potentially resolving challenges around the valuation and taxation of startups.
2. TCS won’t forego margins for growth, give 12-15 per cent hike to top performers
Global macroeconomic obstacles disturbing technology markets worldwide would not snowball into a full-blown crisis, according to K Krithivasan, CEO-designate of Tata Consultancy Services. Terming it more as a short-term blip, he said TCS will not forego margins in search of growth. India’s largest IT firm will give its top performing employees a 12-15 per cent salary hike to keep them on board. It hopes attrition will decline from 20 per cent to 13-14 per cent in the second half of the financial year.
Why it’s important: TCS will have to focus on strengthening relationships with large customers who constitute the bulk of its revenues. It would also work to contain attrition despite a shrinking job market.
3. Slew of investment firms in race to buy nine road projects of Macquarie
A host of private equity and infrastructure investment firms are in the race to buy nine highway projects put on the block by Sydney-based Macquarie Group. Cube Highways, Sekura Infrastructure Fund of Edelweiss Group, and private equity firms Actis and KKR have expressed initial interest in buying the projects, which could cost as much as $1 billion. The 680km projects are in Andhra Pradesh and Gujarat.
Why it’s important: Macquarie has already sold substantial road assets to the Adani Group. Experts say margin recovery in roadbuilding projects could be slow, but valuations will remain high due to potential earnings outlook.
4. Central government aims to build 45km of roads every day in 2023-24
India’s highway construction is projected to accelerate in 2023-24 despite a potential economic slowdown due to global factors. The highways ministry has set a goal to build at least 45km of highways a day. At this pace, a record 16,000 km of roads would be developed in a year.
Why it’s important: The ministry’s targets look optimistic as it failed to reach targets in the past two financial years. Data up to February shows 24km of daily road work in the year ended March.
5. FMCG firms hope for normal monsoon rainfall to revive rural demand
If monsoon rains turn out as predicted and raw material prices continue to ease, rural demand for FMCG items could recover in the next three to six months, companies and industry experts are hoping. Earlier this month, India Meteorological Department said it expects normal rains in the June-September monsoon. The forecast could spell good news for rural India, as nearly half of India’s summer crop area lacking irrigation depends on monsoon rains.
Why it’s important: Although urban markets have shown positive momentum, rural consumption has been declining for six straight quarters till December, putting margins under pressure. The FMCG sector now looks to the skies for relief.
6. India to see solid growth, but global environment will count, World Bank economist says
India will see solid economic growth, but not as much as it would have if global conditions were as in the early 2000s, said Indermit Gill, chief economist at the World Bank. Isolated bank failures will not be a danger to India, but a generalized banking crisis may lead to a global recession and a noticeable slowdown within the country.
Why it’s important: Economic growth rates are declining compared with the first decade of this century. Although India is cited as a global bright spot, its GDP numbers, too, have moderated considerably.
7. Wadi Group to sell stake or completely exit loss-making carrier Go First
The Wadia Group, which owns the loss-making budget carrier Go First, has started talks with strategic partners to either sell a significant stake in or completely exit the airline. Go First, which made its highest annual financial loss to date in 2021-22, has been tackling operational issues in the past few months as half of its aircraft have been grounded due to supply chain disruptions pertaining to Pratt & Whitney engines.
Why it’s important: Although the aviation ministry has stepping in to resolve the engine issue, troubles at Go First are unlikely go away soon. It has failed to raised money from the primary market after its IPO was delayed, crimping its ability to repay loans.
8. Singapore’s AG&P in discussions to acquire 70 per cent stake in Hiranandani Energy
Hiranandani Energy, which had ambitions to build multibillion dollar integrated energy infrastructure projects such as two LNG terminals and a pipeline for end-to-end natural gas solutions, is in talks with Singapore-based Atlantic, Gulf and Pacific Company to sell a majority stake in the firm and its units for a few hundred crores. AG&P is close to picking up a 70 per cent stake in Hiranandani Energy and one of its subsidiaries, while Darshan Hiranandani will hold on to the remaining 30 per cent.
Why it’s important: The transaction value is likely to be worth only a fraction of the initial investment envisaged because Hiranandani Energy could develop only two assets.
9. Warburg Pincus, Kedaara in separate talks to buy Watertec at $450 million valuation
Warburg Pincus and Kedaara Capital are in separate discussions to acquire Watertec India, a local bathroom fittings and accessories maker. The proposed deal will value the unlisted company at ₹3,500 crore ($450 million). Watertec was established in 1997 as a joint venture between Coimbatore-based UMS Group, Watertec Malaysia and Sri Lanka-based South Asian Investments. It is the leader in the plastic bath fittings and accessories market.
Why it’s important: The deal talks are taking place at a time M&A activity has declined in India. The real estate market is showing early signs of revival and Watertec could benefit from that.
10. Central data processing unit to streamline corporate filing in India
India’s upcoming central data processing unit will ensure quick and objective approval of corporate filings by taking over the task from scattered regional offices, freeing up the regional offices for more investigation and enforcement work. The centralized data processing unit will come up at the Indian Institute of Corporate Affairs premises in Haryana’s Manesar.
Why it’s important: Plans to build a centralized data processing unit was announced in the federal budget, but details on its implementation have not been made public so far. The center is expected to automate most of the work at regional registrar of companies.
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