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The End Of An Alliance

 

 

25

What is it? The number of Lok Sabha seats Shiv Sena is confident of winning in Maharashtra in the 2019 general elections, following a political resolution passed by it on Tuesday that says it would contest all future elections on its own.

Why is it important? With this, the regional party has ended its 29-year-old alliance with BJP, which makes it the first political outfit to do so since Narendra Modi became prime minister in 2014. It is unclear if Shiv Sena would withdraw its support to the state government in Maharashtra, where it has 63 seats and BJP 122 in the 288-member assembly. Shiv Sena’s parting of ways comes at a time when the BJP has been on the rise in the state.

Tell me more: The national executive of Shiv Sena unanimously re-elected Uddhav Thackeray as party president and his son, Aaditya Thackeray, who is head of the party’s youth wing, to a group of top Sena leaders.

 

$2 trillion

What is it? The total investment India is seeking in the infrastructure sector over the next two years, according to railways minister Piyush Goyal, who spoke to the media on the sidelines of the World Economic Forum at Davos on Tuesday.

Why is it important? This is nearly thrice the unmet infrastructure needs outlined last year by finance minister Arun Jaitley, who said that India would require about $646 billion over a five-year period until 2022. According to S&P Global Ratings, India and Indonesia would lead infrastructure investments among the South and South-East Asian countries over the next two years. The sector, which is beset with time and cost overruns in project implementation and has a high exposure to banks’ stressed assets, is a major driver of Indian economic growth.

Tell me more: Prime Minister Narendra Modi addressed the opening session of the World Economic Forum in Davos on Tuesday, becoming the first Indian PM to do so in over two decades, where he projected India as a favourable investment destination.

 

4

What is it? The number of companies—GlaxoSmithKline, Shionogi, Pfizer and Novartis—that have taken steps to separate bonus payments to sales representatives from the volume of antibiotics sold, according to an analysis by Access to Medicine Foundation, a non-profit organisation.

Why is it important? This is in recognition of a part of the industry’s efforts to tackle the growing antibiotic resistance crisis globally, though drug manufacturers’ response to this still remains inconsistent. Antibiotic resistance has been described as one of the biggest threats to global health by the World Health Organization, where bacteria change in response to the use of antibiotics in the prevention and treatment of bacterial infections. According to some experts, drug-resistant infections kill 700,000 people per year globally and this could increase to 10 million by 2050.

Tell me more: In 2010, India was the world’s biggest consumer of antibiotics for human health, according to a 2016 study.

 

 

$100 billion

What is it? The market capitalisation that video streaming service Netflix crossed for the first time on Monday.

Why is it important? It is a vote of confidence in its business model. Netflix achieved this feat on the back of a solid fourth quarter, in which its revenues increased 32% to $3.2 billion and it added 8.33 million subscribers, surpassing its own prediction of 6.3 million subscribers. Analysts feel the company is still on the high-growth curve—for Q1 of 2018, the company has projected 6.35 million new subscribers, of which 4.9 million are projected to come from markets outside the US.

Tell me more: In Q4 of 2017, Netflix recorded a net profit of $186 million, against $67 million in Q4 of 2016.

 

17.7%

What is it? The year-on-year increase in air traffic recorded by domestic airlines in December, according to latest numbers released by the aviation regulator.

Why is it important? It continues Indian aviation’s strong run of double-digit growth over the past three years. This period has coincided with a slump in fuel prices, giving airlines considerable room in managing growth along with improving profitability. But with fuel prices surging 20% in the past six months, this state of doing business could be challenged, and could also have a bearing on industry growth.

Tell me more: India remains one of the top growth markets in domestic aviation: in November, it grew the fastest among the seven largest world markets.

 

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Are Promoters Cashing Out?

 

A larger share of IPOs has gone to promoters and investors than to the companies this year. Several LEDs bulb brands are found to be non-compliant. Job growth is not keeping pace with that GDP’s.

 

76%

What is it? The percentage of LED (light emitting diode) bulb brands, besides 70% of LED downlighter brands, sold across 200 outlets in India that were found to be non-compliant with the government’s consumer safety standards, according to a survey by market research firm Nielsen.

Why is it important? The report says this would impact energy efficiency in India, which is looking to replace over 200 million incandescent light bulbs with LED light bulbs under the Ujala scheme. This would pose safety hazards for consumers besides causing losses to the government as some of these brands are manufactured illegally and sold. The total LED market is reportedly worth Rs 10,000 crore, with LED bulbs and downlighters accounting for about 50%.

Tell me more: The Nielsen study was conducted in four cities: New Delhi, Mumbai, Ahmedabad and Hyderabad. Of these, the capital recorded the highest number of Bureau of Indian Standards violations, with nearly three-fourths of LED manufacturers being non-compliant.

 

5.18 million

What is it? The aggregate employment in 1,473 medium to large companies in 2016-17, against 5.07 million in 2015-16 and 5.01 million in 2014-15, according to a study by ratings agency Care Ratings.

Why is it important? The report makes a case for employment generation not being aligned with GDP (gross domestic product) growth. The annual growth in employment in the companies under review was 1.18% in 2015-16, against GDP growth of 8%. In 2016-17, growth in employment improved to 2.25%, while GDP growth slowed to 7.1%. This is also a worrying trend for the NDA-led government, which had swept to power in 2014 with employment generation as one of its key promises.

Tell me more: The study warns it does not include the small and medium sector, which plays a dominant role in employment generation. However, it claims to be “indicative of the trends witnessed in the last two years”.

 

1,000 km

 What is it? The length of the proposed tunnel that China is planning to build to divert water from Brahmaputra, one of India’s largest rivers.

Why is it important? The tunnel, which would be the world’s longest if built, could become another point of tension between the two Asian countries. Recently, India and China were locked in a 73-day military stand-off over the construction of a road by the latter in Doklam, the border tri-junction with Bhutan. The tunnel project involves draining of water from the river in southern Tibet, which is close to Arunachal Pradesh. India, a riparian state, has previously expressed concern over the number of dams being built by China on Brahmaputra; the Chinese say these are run-of-the-river projects and not used for storage purposes.

Tell me more: The tunnel is expected to drop from the world’s highest plateau in various sections connected by waterfalls and provide water to China’s Xinjiang region, a barren area in northwest China.

 

6

What is it? Number of seasons that House of Cards, the popular Netflix political drama series, will finish with. On Monday, Netflix announced the 2018 season, currently being filmed, would be its last.

Why is it important? The announcement comes a day after Kevin Spacey, one of the lead actors in the series, issued a public statement to allegations that he had made unwanted sexual advances on a 14-year-old boy in 1986. Kevin Spacey is the latest Hollywood figure to face a pushback after allegations of sexual abuse, following producers Harvey Weinstein and director James Toback.

Tell me more: Netflix maintained the decision to terminate the series—whose Season 1, aired in 2013, is ranked 33 in IMDb’s list of most popular TV shows—was made “months earlier”.

 

80%

What is it? The share of initial public offerings (IPOs) in 2017 that has gone to promoters and investors of companies, as compared to the companies themselves.

Why is it important? This is the highest percentage since 2003. Seen another way, only one-fifth of the combined size of IPOs has come to companies as new capital, which they can channel into avenues of growth and business enhancement. This also means that promoters and investors are using the buoyancy in the market to cash in and unlock value.

Tell me more: The current IPO rush has also seen entirely new sectors debut on Indian bourses, notably insurance and mutual funds.

 

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Men of steel ✊

96%

What is it? This year’s southwest monsoon rainfall estimate as a percentage of the Long Period Average (LPA), or IMD’s long-term rainfall-tracking benchmark.

Why is it important? The first-stage forecast is for normal southwest monsoons, alleviating worries about a dry season, for now. The monsoon’s distribution and timely arrival would determine if there would be a positive impact on GDP or not. In 2016, the same was for 106% of the LPA (which is 89 cm for 1951-2000). But in the drought-ridden year of 2015, the initial forecast was 93%, only three percentage points less than this year’s estimate.

Tell me more: The forecast would get updated in June, when the weather phenomenon of El Nino would have evolved further to paint a more accurate picture.

 

Rs 64,562 crore

What is it? The investment by the public steel manufacturer, Steel Authority of India Ltd (Sail) till December, 2016.

Why is it important? Sail is spending on modernisation and expansion of its integrated and special steel plants when India is set to leapfrog Japan in steel output in a few years. While the Indian Steel Association has said production would increase from 101.3 million tonne in 2016 to 240 million tonne by 2031, the Australian Department of Industry, Innovation and Science has predicted India would overtake Japan as the third-largest producer by 2019 with 118 million tonne. Sail’s expansion would raise its capacity from 12.8 million tonne a year to 21.4 million tonne (67%).

Tell me more: The steel major is in the last leg of its Rs 70,000-crore planned investment to raise capacity by 60-70%.

 

4.95 million

What is it? The net subscribers added by Netflix, the Internet video-streaming service, in the first quarter of 2017 (Jan-Mar).

Why is it important? The measure of new customers for Netflix went down both sequentially (30%) and year-on-year (27%) due to the lack of a blockbuster original production, and the tepid response to its new releases such as the latest Marvel-backed superhero series (Iron Fist). Instead, its profitability improved. In India, it finds itself competing for audience with Amazon Prime and homegrown popular apps such as Star India’s Hotstar, even before it got a chance to consolidate a lead.

Tell me more: Netflix’s net income/profit rose to $178 million in the quarter, a 166% rise sequentially and 536% rise year-on-year. In India, it plans to double its investments with an office in Mumbai, rather than operate the business out of Singapore which it had been doing so far.

 

51,000 kms

What is it? The length of roads to be developed as expressways under Indian government’s Bharatmala scheme.

Why is it important? Mega road projects have both short term and long term benefits, generating jobs immediately and boosting growth over time, and Bharatmala is one of the most ambitious and expensive projects of the NDA government. The total investments is pegged around Rs 10 trillion. The National Highways Development kickstarted by Vajpayee government will be subsumed under Bharatmala going forward.

Tell me more: A more specific and formal outlay and plan is likely to be a part of the next budget.

 

Rs 2.35 lakh crore

What is it? Market capitalisation of State Bank of India, end of Tuesday.

Why is it important? State Bank is now the most valued public sector unit, surpassing Oil and Natural Gas Corporation, which has a market cap about about Rs 2.29 lakh crore. State Bank shares rose by 16% this year. Interestingly, this came on the day when Vijay Mallya was arrested and then let go on a bail after a few hours in London. A consortium of banks led by State Bank of India had sued Mallya’ Kingfisher Airlines for defaulting on loans. State Bank’s gross non performing assets (or bad loans) stood at 7.23% end of December.

Tell me more: State Bank stands fifth in the list of top Indian companies by market capitalisation. Tata Consultancy leads the list, followed by Reliance Industries and HDFC Bank.

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News in Numbers, Feb 07, 2017: A season of crackdowns

Rs 14,779 crore

What is it? The principal balance the Supreme Court wants to expedite recovering from the  Sahara Group for its investors.

Why is it important? Striking down Sahara’s appeal for time till 2019, the apex court ordered attaching its star property in Pune, the Aamby Valley, as part of the recovery process. Around Rs 600 crore of its Rs-25,780-crore principal owed was paid on Monday.  SC’s order was the latest entry in a season of crackdowns on erring business houses/moguls. The property will be under the court’s custody.

Tell me more: The court has asked for a list of other Sahara properties free from litigation for recovery of its dues to investors in two of Sahara’s companies. The due totals Rs 37,000 crore, as calculated by Sebi, including interest, of which around Rs 11,000 crore has been paid so far.

97

What is it? Number of companies, 96% of them tech giants, that filed a court motion challenging US President Donald Trump’s order on immigration.

Why is it important? Companies such as Microsoft, Apple, Google, Facebook, Intel, Netflix and Twitter, and three consumer-goods companies including fashion brand Levi Strauss, have taken a step further than just denouncing the executive order by taking legal recourse. They join federal judges who have legally rebuffed Trump’s move to restrict immigration of certain nationalities, with one even restraining it nationwide. The companies’ motion was filed in the very appeals court which rejected the government’s emergency request to resume the travel ban.

Tell me more: The motion filed in the Ninth Circuit Court of Appeals said the travel ban “violates the immigration laws and the Constitution”.

Rs 2.5 lakh

What is it? The upper limit of deposits for which the Income Tax department will ask no questions, reiterated by the Central Board of Direct Taxes (CBDT) chairman Sushil Chandra.

Why is it important? Amidst growing concern about the expanding reach of the tax officer with all the cash-scrutiny, the senior official’s statement should bring relief. The limit means the IT department will for now refrain from running analytics on deposits below it.

Tell me more: It would study larger single deposits or multiple deposits against a single PAN card that don’t match IT returns.

80%

What is it? Percentage of Tata Sons’ shareholder votes that were in favour of removing former chairman Cyrus Mistry from Tata Sons’ board of directors

Why is it important? The move is a part of the ongoing fight between Tatas and Mistry that started with the removal of Mistry from the chairmanship of Tata Sons in October, followed by similar actions in various Tata companies, including Tata Motors and Tata Consultancy Services. The latest was expected. Tata Trusts controls 66% of Tata Sons, and a simple majority is enough to oust a director. Shapoorji Pallonji family, to which Cyrus Mistry belongs, and which owns 18.4% in Tata Sons, now has no representation in the board for the first time in over ten years.

Tell me more: Cyrus Mistry did not attend the board meeting. Ratan Tata’s half brother Noel Tata, whose sister is married to Mistry, voted in favour of Mistry’s removal from the board.

9

What is it? The number of chief justices recommended by Supreme Court collegium for various high courts

Why is it important? If the government approves, this would likely be the highest number of appointments of chief justices in one go. Many high courts in the country are being served by interim chief justices. More importantly, it’s an indicator that the tension between the government and the judiciary over appointment of judges could be easing. At its height, Supreme Court had struck down National Judicial Appointments Commission in October 2015 and revived the collegium system in which a panel of judges make the judicial appointments.

Tell me more: Besides High Courts, the Supreme Court also faces vacancies as a result of the tug of war. The apex court has been functioning with 23 judges since early this year, falling short of the sanctioned strength of 31.

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