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Interview: ‘What’s good for India is good for HUL,’ says CEO Rohit Jawa

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Hindustan Unilever (HUL) Managing Director and Chief Executive Officer (CEO) Rohit Jawa shares insights on marketing, how digitsation is the big growth driver for India and many more transformational trends taking place at the FMCG firm in a conversation with CNBC-TV18 Managing Editor Shereen Bhan in the latest edition of Lessons in Marketing Excellence.

Hindustan Unilever (HUL) Managing Director and Chief Executive Officer (CEO) Rohit Jawa shares insights on marketing, how digitsation is the big growth driver for India, and many more transformational trends taking place at the FMCG firm in a conversation with CNBC-TV18 Managing Editor Shereen Bhan.

Here are the edited excerpts:

Q: When you were in college, what was your big aspiration and big dream?

When I joined my MBA course and went through various cross functions, I fell in love with marketing and used to revel in all of the consumer behaviour cases, the Unique Selling Proposition of Rosser Reeves, and beautiful Volkswagen advertisements. I always wanted to work for a marketing company and no doubt in 1988 that HUL was the best marketing company. It was my dream to join, and I did.

Q: What does the HUL of tomorrow mean to you in terms of the growth engines that will drive it?

I can tell you that India is where perhaps one of these great Tiger economies, or China, was 10–15 years ago. We are poised to break through. And I see that; I smell it in the entrepreneurial energy in the market, I smell it in the consumers’ aspirations, and I feel these are dramatically transforming India, which we need to recognise as a company. One is India’s getting more prosperous; the top mass affluent, or middle class and above, have doubled in the last five years and will double again from something like 40 odd million to 90 odd million households. We’re talking about the size of the US in terms of consuming population.

Second, the big driver of growth is digitisation. It has democratised India. I know ONDC is going to democratise digi-commerce. But the India tech stack has changed unlike any other country in the world, including China. What we’re seeing here is pioneering; it is transformational. It’s changing how we do business. And it’s also changing consumers’ aspirations. Whether you’re in a village, in the deep rural east of India, or you’re in the city of Mumbai, you can watch the same sort of media and have the same aspirations. That’s creating a lot of demand to upgrade and to aspire. We have got to recognise that this is a vast country—1.4 billion people—and we have to be responsible towards our communities and the environment. There is no better company than HUL because our mission is that what’s good for India is good for HUL.

Q: Given the fact that we’re now anticipating an even higher jump as far as per capita is concerned, what will that realistically lead to when we talk about premiumisation?

We are an India with a 1.4 billion market. Our per capita consumption of FMCG, even in the categories we play, is only $50 odd. If you compare that with Indonesia, that’s four times as much, and China six times. There’s a huge runway for growth. And when we look at every category we play in, we see that we are about 10–15 odd years behind these mega markets. In some categories, the journey could be a little faster or slower, but what I’m saying is that in the next decade, we could see some categories doubling, tripling, or quadrupling.

A couple of places where I believe this is still happening at a fast pace are beauty care and packaged foods, where I think the pace of transformation will be even faster. And what we’re doing about that is building a portfolio to serve all demand spaces. Choosing the segments we want to play in as HUL, where we are good, and where we can bring Unilever’s leveraged brands and investing capabilities. I think that’s really what we’ll have to do as we evolve from where we are today to the 100th year of HUL.

Q: With digital beauty brands and that entire aspect, how much of this is largely going to be driven by organic growth? How much of it is going to be driven by inorganic growth? What looks exciting to you in terms of the kind of D2C explosion that we are seeing?

We are the skincare or beauty care market leader, both in colours and in skincare. We already have a four-time relative market share; it’s a very margin-accretive category. But as the market evolves, as consumers increase their regime and use more than one stage in usage, the market premiumises and we start to see new demand spaces that go beyond brightening tone management, anti-ageing to hydration, sun care, and so on. We know that we have to play the full portfolio. How consumers buy beauty care is also different; there will be some consumers who will buy it more as part of their daily routine with our Glow & Lovely brand or with Ponds, but many consumers are looking to influencers on social media to buy on platforms like Nykaa and other such e-commerce platforms. They are purely digital; they are about experience.

As far as digital brands are concerned, they are digital in the sense that they are digital-first and not digital-only. So, they have to go beyond D2C platforms to marketplaces. And then they have to go to bookstores and pharmacies offline, and we know that game; we were there. We have already hacked the playbook, so to speak. We have built through our premium beauty business unit a couple of brands that have already crossed the 100 crore ARR mark.

Some of our brands, like Lakme, are already very digital. They have a large share of e-commerce. It’s getting transformed, it’s getting premiumised and it’s looking cool and very attractive. We have very good innovations there. So that brand is an old brand, but not a dated brand. It is a contemporary, fresh brand that offers the best of beauty at a very good price to consumers.

Q: What’s the big lesson and the learning as you now foray into this digital-first space?

While the fundamentals are the same, the way marketing is done has dramatically transformed. And this is an example of how it’s transformed. In the last two to three years, we have built and run the premium beauty business unit. We have an agile innovation lab where we can scan ideas, use machine AI to build concepts, have them simulated, checked for the highest level of opportunity, crafted through our R&D labs in small batches, test them out with consumers, find the product market fit, start getting consumers, acquire them, scale them, get to a level where we feel okay now that this is being loved, and before you know, you have a few hundred crore worth of business.

Q: How much has the needle moved in terms of digital and AI adoption? And externally, from a customer-facing perspective, what do you believe that could lead to over the next five years, for instance?

The way we see digitisation is, it’s going to do one of three things: drive growth, reduce costs, and improve our capabilities. We have been on a journey to reimagine HUL for several years now. And we see them basically in three different parts. There’s the operations or supply chain, where digitisation has a big role to play. It’s in the area of our customers, so how we go to market—Shikhar is an example, which is our B2B app. And then, of course, our consumers, and I just talked about how we are, for instance, creating products but also selling products through digital commerce and all of the data signals that we get from there.

To give you a few examples, for instance, on the supply chain, we have many use cases that we believe are creating huge value. For instance, we can do digital twins of our factories. Sitting in this complex, we can already model how to improve the productivity of our plants across the country.

When it comes to customers, and if you look at our GT business or traditional trade, we go to 2.7 million stores, of which 1.3 million, including some in rural areas, have signed up on our app. A million of those order every month.

E-commerce and digital commerce are already the fastest-growing channels for us. And we are gaining competitiveness there. And that’s going to be a place that we want to lean on because that is going to grow and will more than double from what it is today as a contribution to our business easily in the next five to 10 years.

Q: So, e-commerce contribution doubles in the next five or 10 years? It is a fairly wide range there.

I would say five would be my hope and ambition. And we’re investing based on that.

Q: What is the percentage of sales that you are spending as far as tech is concerned? And do you believe that that number is going to significantly increase going forward?

We are investing more than a third in our digital media. And that’s going to go up even further. Because consumers are spending more time on digital, that means that we have more data, we can target better, and our media spending can become even more efficient. And we are investing in leadership and capability, even on the top team, to make sure that our entire advertising and marketing investment is highly optimised through data.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

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Dollar-Rupee 73.3500 0.0000 0.00
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Exclusive | Interview: Microsoft CEO Satya Nadella outlines next-generation AI solutions vision

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Microsoft CEO Satya Nadella speaks with CNBC-TV18 Managing Editor Shereen Bhan in an exclusive interview, sharing insights on the AI revolution, its impact on economic productivity, navigating workforce dynamics, and its transformative potential. He underscores Microsoft’s commitment to investing in India’s AI ecosystem, aiming to foster innovation and empower businesses across various sectors.

Satya Nadella, CEO of Microsoft, shares insights on the artificial intelligence (AI) revolution during an interview with CNBC-TV18. From its impact on economic productivity to navigating workforce dynamics, Nadella highlights AI’s transformative potential. He underscores Microsoft’s commitment to investing in India’s AI ecosystem, aiming to foster innovation and empower businesses across various sectors.

Below are the edited excerpts:

Q: In the last 12 months, it’s almost as if no one can talk about anything else but AI, whether it addresses climate change or cancer. It’s the sort of elixir that everyone’s talking about. Between the headlines and the hyperbole, where are we in the journey today and more importantly, over the next five years, where do you believe we will be?

A: You are right; I mean, a lot has happened since last year. I was very excited about the prospect of what AI could mean. I was stunned even at that point, seeing how some of the leading model work we had done was diffusing in India and even in something like the public sector. That is the first time I saw Bhashini’s demo, coupled with GPT-4, and I was like, really, it was a drop-the-mic moment for me, and to come back a year after. And we are no longer just talking about AI. I mean, some of the use cases I talked about this morning, I saw from customers, commercial customers, and non-profit organisations. I think this is the fastest rate of diffusion of anything new I have ever seen.

And to your point, why is this excitement? Because I think it’s tangibly changing economic productivity. Now, whether it’s for software development or frontline work in retail and healthcare, whether it’s access for a citizen or rural, say a new immigrant into the urban area, in India to be able to access services I have not seen a general-purpose technology like this that can have that type of broad impact and that’s where I think the excitement comes from.

Q: Speaking about the excitement, let us also talk about the disruption, because while we are talking about productivity gains and what this does to workflow, what will it do to the work force is the question and where do you stand on that?

A: First of all, at the core level, we should sort of go back to the lump-of-labour fallacy. I think labour markets are a lot more dynamic than we give them credit for. But at the same time, we should be clear-eyed about any displacement. So a couple of things that we can do are: One good thing about this generation of AI is that it reduces the learning curve, not increases it. So even for somebody displaced mid-career, you can pick up new skills faster or easier, so that’s sort of one.

The second thing it does is, if the previous era was about information at your fingertips, I think of the AI era as expertise at your fingertips. So you can take somebody who’s on the front line, whether it’s in retail or whether it is in healthcare, and perhaps it will even improve the wages because they are now able to give more expert health advice or more expert work is being done by non-experts. They may have domain expertise, but they may not have all the knowledge. And so, therefore, I think that there could even be better wage support in new jobs.

One of the coolest examples I saw is right here in India. In fact, it was sort of incubated at MSR, and after that, the founder of Karya took it and created Karya, which is about taking AI jobs. These are new jobs that didn’t exist around labelling data, and what have you, that are now being essentially syndicated out to rural India, where women are mostly able to find wage support, better wages, 20x wages, compared to what is the general wage, for doing AI jobs.

So I think we will have new jobs, our ability to go up the learning curve will be faster and better, and even better wage support for some of the things that are on the front line.

Q: But in the short term, do you believe that we are actually going to see more job losses than we do see job creation? Because we have already started to see companies talking about restructuring on account of adopting AI?

A: I think that is what is happening. Some of it is just an adjustment. I think this is where, as I say, labour markets adjust. If you take software development, the reality is that there is a need for more software developers all over the economy, not just in the tech sector. So that’s where I think if there is one sector that’s getting “more efficient,” some of the labour force in that sector will disperse more broadly. So I think that yes, I am not at all saying that there is not going to be displacement, like with any new technology we have seen. But I am also very optimistic that we have both the policy tools and the actual tools to help us manage this transition in a net positive way for even a country like India.

Q: Speaking about managing this transition, what is it going to mean in terms of investments at the company level? Let’s talk about Microsoft. You did talk about disproportionately investing in building out AI across your tech stack. And for the industry in general, what are we talking about in terms of investment?

A: We are obviously very excited by what we are seeing in India. At the end of the day, we are putting in our capital, but we are building out our own data centres. We have four regions, and we will keep expanding that. We are investing in our own people here, both in India as a source of human capital that’s producing products for us all over the world and also in the US helping customers, the IT services companies that serve the world from here, equipping them with the latest and greatest. So that’s what I think I would call the core of what we do.

But beyond that, I would say the investment here is that if you have a new general-purpose technology, India has a tremendous opportunity to use it in a broad sectoral way, in the public and private sectors across every industry, including healthcare, retail and energy. We want to make sure that we are there. I like to tell you that we talk a lot about Co-Pilot, and I want us to be the Co-Pilot for India, as it takes advantage of AI, creating in fact, its own AI products across all of these sectors and exporting them to the world.

Q: Do you have a number though of what it will take for Microsoft to invest here in India and also what Indian companies will need to do in terms of further investments?

A: The economic data I have seen is, if the Indian economy is going to be like, say, $5 trillion, the AI-driven part of it could be something like maybe 10% of it, maybe $500 billion of it. So what we are going to do is, and all of that being powered by things like cloud computing with these frontier models, open source models, small language models, and so on. And so our capital investment and human capital investment will really fit into that.

So the way I think about it is, if Microsoft has X revenue inside a country, that means there needs to be 99% more revenue created because of the output of computers, and so that’s kind of how we will invest.

Q: I want to talk about OpenAI and of course, your partnership with OpenAI. Sam Altman has said it’s one of the greatest tech bromances. But how do you de-risk yourself? I know that you said that you are not really interested in what the board seat does for you. But obviously, you do want to ensure that there is stability as far as OpenAI is concerned. How do you de-risk yourself from a commercial perspective? Have you re-negotiated your commercial terms, for instance, do you intend to do that?

A: First of all, I have grown up in a company that has always created lots of enterprise value by partnering and partnering well. I grew up in a company that’s where Microsoft and Intel really brought together the advances that Intel made and what we did with Windows; the same thing happened with SAP. In fact, I built our database business by partnering deeply with SAP. So at some level, this is core to us, and the latest example of that is what Open AI and Microsoft have been able to do. So we are very comfortable with the partnership and what it has achieved to date.

Of course, we want stability in OpenAI. We are very excited about the new board. We have an observer seat. We were comfortable before and we are comfortable now. And at the end of the day, we want to be good partners where OpenAI can succeed with us and we can succeed with OpenAI. But more importantly, at the end of the day, it’s our customers and partners who rely on the two of us. Just like how the PC revolution was created by Intel and Microsoft, we hope the OpenAI-Microsoft relationship creates the AI revolution.

Q: You said you are waiting for the competition? Where do you believe competition is going to come at you from?

A: It’s going to come from everywhere. I think that all of our big tech peers have done faster work on all of this. It’s fantastic. I mean, therefore, one of the things that I think is understated is competition among big tech players. I think it’s very healthy when you have all of the folks competing with each other, which means it’s creating a real opportunity for the world to benefit. New entrants, whenever anyone gets excited about the existing incumbents, you have to watch out for new entrants, and Open AI is a great example, after all. OpenAI wouldn’t have existed without our support early on, but they are a very credible company today. And we are excited to be able to sort of really play our part in it.

Q: A decade now at Microsoft steering things and it’s a very different company in so many ways—$3 trillion in market cap to just start with—what are you proudest of over the last 10 years of the changes that you have been able to achieve? And more importantly, what do you see as the engines that will drive Microsoft from here on?

A: It’s a great point; in fact, the way I count my time is that this is my 32nd year at Microsoft and my fourth big platform shift. I was lucky enough to be part of the PC client-server, the Web Internet, the mobile cloud and now AI, and this is year two of AI. If anything, I am going back in time to your point of learning from what it was like when year two of the PC revolution, year two of the browser, year two of, say, the cloud, and the lesson I learned is you got to really take the new tech, lean in completely, democratise it, and have innovation. Because, at the end of the day, there is no franchise value in our business. What matters is, long before conventional wisdom, can you make it to the other side and then really create that platform. And that’s what I am excited about.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Indigo CEO files flight plan for a stronger brand; puts organic growth front & centre: Exclusive Interview

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

IndiGo is adding new routes to its international destinations but the CEO Pieter Elbers says that the domestic market remains the core for the company. Read more in this freewheeling chat.

India’s biggest airline by market share IndiGo is highly optimistic about its growth, with works on to expand international routes to a 100 destinations from the current 70.

CNBC-TV18’s Shereen Bhan caught up with the airline’s CEO Pieter Elbers soon after its first quarter results were out. The chief of the aviation company, which reported the highest ever-quarterly net profit of Rs 3,090.7 crore, explained about how it has taken measures to mitigate the challenges faced by its competitors.

IndiGo is also celebrating 17 years of operations today, July 4. The airline’s inaugural flight was from Delhi to Guwahati on August 4, 2006, and since then it introduced the concept of ramps for boarding and deboarding, launched its first international flight to Dubai in 2011, became the first Indian carrier to operate 1,000 flights a day in 2017, ventured into the Udan scheme in 2018, set a new record of maximum number of 3 lakh customers a day in May 2023, and recorded its largest order book of 500 A320 aircraft in June 2023, bringing the order book close to 1,000 aircraft.

The airline’s CEO said IndiGo is looking into tapping the strong growth in India, especially in its aviation market, by connecting to a wider network of destinations.

Here are edited excerpts from the conversation:

Q: Let us start by talking about the standout quarter that you have been able to deliver and the question, though, is this sustainable? Are you going to be able to replicate the kind of margins which have come in at a record high of almost 31.2 percent, record revenue, as well as record profit, in terms of demand, and in terms of the external environment, will you be able to redo this performance?

A: Indeed, this results for this quarter has been actually a wonderful and very strong result and a lot of things were coming together in this quarter. And if you take a little bit of a step back at COVID, we have pretty much 10 quarters of consecutive losses and by the middle of last year, as from the third quarter, we are back into profitable territories. So now for three quarters in a row, we are back into black numbers, black figures, and this quarter obviously has been the highest one from the three.

And what we see really is a combination of two factors. Firstly, we see a very strong demand in the markets, the Indian economy is growing, Indian travel is growing, and visitors are growing. So a very strong market demand. India does not only have one of the fastest recoveries post-COVID in the world, but also a very solid demand going forward.

The second factor, really, what is helping us is that we have launched a whole range of initiatives last year, and we see that all these initiatives start to pay-off. So this combination of a strong market on the one hand side, and a lot of initiatives including a very strong operational performance, are really helping us in creating such good results. We are not making any prediction, what is going to be the precise result next quarter, as there is always some seasonal fluctuations in the results. But the foundations what we are doing as a company are really very strong.

Q: Speaking about what is happening in the market, I thought you would address that in terms of factors that are possibly helping you as well. We have seen significant amount of capacity being squeezed out of the market. Go First, there is no clarity on when it is likely to re-launch. There is no Jet Airways at this point in time. SpiceJet is facing its own set of troubles, as are you on the supply side. But how much of the capacity constraints are actually aiding you at this point in time and what could that potentially mean in terms of market share addition?

A: We prefer to look at IndiGo at what we can do and how we are able to help the market with the capacity, what is needed. Since we had the first challenges in the middle of last year with some of the supply chain challenges, forcing us to take some mitigating measures, we have been very consistent actually, in meeting our capacity guidance. We have given the guidance for last year, we have met the guidance even slightly higher. We have given the guidance for this year, and the call which we had earlier today, the north mid-teens are just repeated. So what we have actually in place at IndiGo is a whole range of mitigating measures, some extension of leases and we are of course, in the situation whereby we do have a steady flow of aircraft coming in.

To your question on Go First, yes, the suspension of Go First flights in early May created, of course, some certain market disruptions and dynamics. However, I should say, after a couple of days, you see that things are stabilising. And for us for the 400-plus domestic routes we are flying, there was like 15 to 20 percent of these routes were also operated by Go First. So the actual overlap on our network was limited, I should say.

The majority of the growth what we are seeing is really the growth of the markets and if you just compare today’s market numbers to that of the situation before COVID, we are actually significantly higher. For us, year over year, we almost had a 30 percent growth in terms of passenger numbers. So that’s really new market and we keep seeing and that’s one of the — I would say — strongholds of IndiGo we keep seeing a lot of first time fliers in our aircraft and the very strong government policies in promoting air travel and making sure that smaller communities have access to air travel, that’s really supporting the growth of aviation in India itself.

Q: You have talked about Go First and I would like to address the rumors and reports appearing in the regional press that suggests that IndiGo might be interested in Go First. Is there any truth to that at all?

A: IndiGo is focusing — again I am not reacting to any rumors — but IndiGo is focusing on developing our own company, we have a steady flow, I mean, even before we placed the most recent mammoth order of 500 aircraft, we already had 470ish aircraft yet to be delivered. So we are in a strong position to build our company and build our brands and that is really our focus going forward.

Q: Let us talk about some of the challenges that you need to contend with as well and I know that you have addressed this on the investor calls. I am just trying to get a little more clarity from you on the Pratt & Whitney recall aspect. In the first phase, Pratt & Whitney has announced that starting September, they will recall about 200 aircraft globally. Now, you have said that that will impact IndiGo in single digit numbers. You already have 40 aircraft grounded currently. So starting September to perhaps the end of the year, which is part of the winter schedule that you have to factor in, what will be the operational fleet size? What will be the grounded fleet?

A: We said we have in the highest 30s of AOGs (aircraft on ground) and today, I think we communicated that we are having around 40ish aircraft, which of course are driven by the supply chain. In addition, and that number is actually pretty stable over the past time.

Most recent announcements of the first batch of 200, I mentioned a single digit number actually for IndiGo. So that is for the weeks, and the months ahead will not have a very significant impact. Those are the numbers we can deal within our capacity guidance. And again, today, even for the full year, we have repeated our capacity guidance of the north mid-teens. So we don’t know yet precisely what’s going to be the next phase of the Pratt inspections to take place. We don’t know precisely what is the impact of that. We will work closely with Pratt whenever we have more information, whenever we get more information, we would like to be totally transparent. That is why we shared in our investor call whatever info we have we share there.

I think it’s important to be transparent. And of course, we are working like we did last year on the range of mitigating measures such as extension of leases and the two wide-body leases we are having from Delhi to Istanbul and Mumbai to Istanbul are clearly also helping. So a range of measures, a range of initiatives and a stable capacity guidance — in other words, we continue to execute what we plan to execute, and we will deal with this together with Pratt how to find more mitigating measures for that.

Q: Let’s talk about the other challenge, it is actually been a better environment as far as crude is concerned and you have seen the benefits of that play out for you in the quarter gone by. But we have now started to see crude prices inching up and that’s resulted in aviation turbine fuel (ATF) moving higher as well. How much of a risk factor is that at this point in time, what are you penciling in?

A: There is obviously some global fluctuations in the prices of fuel and IndiGo, of course, is just affected by these global fluctuations and one quarter the effects are positive and another quarter, they could be negative. So I would not be in a position to predict or to speculate. And I think I have said that before, not sure to you, but if I were to be able to have a precise prediction for oil prices, I probably would not run an airline but have a different job. So we just follow actually here.

I think in the long run, actually, we see that there’s always a correlation between fuel prices and actual prices of tickets. You mentioned ATF, I think what’s an important element in India today is that more and more states and more and more stations actually, as part of the government policies are lowering the taxation on the ATF and aligning that. That helps a lot in order to make sure that India becomes more and more a global aviation hub.

And we are not only looking to passengers within India itself but even passengers traveling to and from and via India and more and more, we are building that connectivity and that connectivity system and that in itself will also help us to mitigate some of the fluctuations in prices which take place anyway.

Q: You have talked about the aspiration of making India a global aviation hub and I want to ask you this in the context of what we are seeing play out in the NCLT, etc. and there have been different representations being made on the rights of the lessors. One of the concerns is that there is a crisis of confidence within the lessor community. How are you reading that? How is that likely to impact agreements going forward? Are we already starting to see that being penciled in as far as security deposits are concerned, change in agreement at this point in time? How do you see this playing out for India in the medium-term, given the current environment?

A: I think we should probably make a bit of a differentiation between what’s the trend in the direction and what are our actual situations. And the trend and direction of India is that India will grow as an economy, India will take an even more prominent place on the global stage as we basically see that growing by the day. With that the Indian aviation market will continue to grow and actually, whatever prediction you follow — and at the IATA conference a little less than two months ago in Istanbul, it was all about India, looking at the airshow in Paris, where IndiGo announced its order and Air India dated slightly before that, it was all about the growth of the Indian market.

So the general direction and the general focus on India becoming such a vibrant aviation market, that is there. Then, of course, there is the situation around Go First, which we follow closely, where it’s important that it is matching some of the international standards and practices. So I think it’s a bit premature to now connect the two and say, because of this, that will happen. Again, what is important is what is the long term perspective and how some of the actual situations, which I think it is still under development, it is probably not totally worked out or still some work in progress and some discussions going on to my understanding, without being aware of all the details, which are of course taking place behind closed doors. I think the overall direction is clear and India will continue to be developing as a global aviation powerhouse.

Q: You talked about India’s place in the global aviation market. And we have seen its position consolidating, you spoke about those two big orders, yours and the one that’s coming from Air India, as well. So I want to focus now, specifically as far as your own international plans are concerned, because when we last spoke, you did say that you wanted to aggressively now amp up your international expansion plans, given where capacity is and your aspirations, what should we now expect in the next few months, perhaps over the next year?

A: I think one of the things at IndiGo is, we say what we’re doing and we’re doing what we’re saying. So when we said we’re going to make international expansion, we’re actually doing it and think about this, we announce more international expansion in three days from now. We will start our flight from Mumbai into Nairobi. First time ever IndiGo is connecting India into Africa — the first time an IndiGo aircraft is touching down on African soil, which is great.

Two days later, we start with direct flights from Mumbai into Jakarta. Again two days later, we start flying from Delhi into Baku and Tbilisi. Later we are adding Almaty and Tashkent. So we keep on adding that international network. And it’s not only plans, it’s actually coming into life. And with that, you see that our relative share of available seat kilometers is moving from the low 20s to a 30 percent of our network.

And as we continue to build not only new destinations, also lot of new routes are being added. And some of the examples I gave earlier today is next week, Friday, we start direct flights from Ahmedabad into Abu Dhabi. So these are both existing destinations, but we keep adding new routes and we’re actually heading now towards a set of 100 different international routes, which a few months ago was only 70. So from 70 to 100 international routes, I think that speaks to what we’re doing in terms of international development.

Q: What is the aspiration? You said that IndiGo delivers on the talk, it walks the talk, what’s the aspiration? What’s the internal target on what amount of revenue you expect from your international operation by 2025?

A: Yeah, I think we’re not giving any guidance longer than 12 to 24 months, because around international development, there are significantly more uncertainties than there are for domestic, we need to get the air traffic rights, we need to get the slots, we need to get all the permission. So in terms of precise percentages, I would prefer to sort of stick to one or two year outlooks and we’ve now moved from 20 to 30 percent, or we will ending up in the range of 30 percent. And that will continue to grow.

The next phase really is the XLR coming in by the end of 2024, early 2025, which will further extend our range of flying. And then if you take again, we could start flying to places like Delhi-Athens and Delhi-Rome and to Seoul, but not only new destinations, also places like Delhi to Nairobi would then be possible, which today is connected Mumbai-Nairobi. So we can we can further expand our network and really build on that international network profile, then the precise percentage is going to be an outcome of that network development and not an objective in itself.

Q: That’s as far as your international plans are concerned. I want to go back to the comment that you made about the strength of the domestic market and how you are seeing first time fliers coming on board and you’re seeing a growth within the market itself. Now, what more can we expect from IndiGo, especially when we talk about the UDAN routes. Are the UDAN routes now, minus the viability gap funding, are profitable routes? How do you see IndiGo as the market leader expanding the domestic market?

A: It’s an important point, of course. We like to speak about our international expansion and the growing share. The very backbone and the very foundation of IndiGo obviously, is still our domestic markets. And when we were speaking about the share of available seat kilometers, clearly, that’s high internationally.

When we speak about the individual customers, clearly the domestic is still the backbone and the fact that we are now — and I should pronounce it correct — we start flying into in Shivamogga from Bangalore, that’s just our 79th domestic destination. So we keep expanding that domestic network.

Earlier this year, we connected Delhi to Dharamshala. Now we’re not in fact only connecting Delhi to Dharamshala, but suddenly it connects over Delhi to a lot of different places. So our strategy domestic really will continue to add destinations, and more so adding a number of routes.

And another very interesting statistic actually, is that today we operate a little over 500 routes, prior to COVID that was 350 routes. So we’ve added a total of a little short of 200 new routes since COVID, which I think speaks to what is our plans domestic. Adding new destinations, but even more so, adding a whole range of new routes and making sure that all these customers who want to fly actually have the access to air travel.

Q: Speaking of new opportunities, I also want to understand from you on the freight aspiration as well, which is of course, something that we saw all airlines are focusing on through the COVID period. Now, where do things currently stand on that front? And how big is that aspiration for you?

A: Today, let’s take a step back. IndiGo has performed very well on cargo during COVID like a lot of other airlines. But with narrow body aircraft, it’s a different setting. We do have in place today two Airbus 321 freighters dedicated to that. And in fact, we have quite a bit of cargo capacity on our leased 777 aircraft to Istanbul. That gives us the opportunity to get more experience also with that international cargo side.

Later this year, we’re expected to get a short freighter coming in. And with that we start to build up our network and basically like similar to what we’ve done on the passenger side. It will take a bit enough time before we have that whole network up and running, have established all our customer bases. But I’m very proud of what our cargo team really is doing and start to build from these two freighters — not only the two freighters only, we do have 1850ish flight per day. So we see with the growth of eCommerce in India, with the growth of some of the pharma industries, with a lot of growth going there, that going forward, we still have a lot of aspirations and ambitions in that field. Having said that, it’s taking us of course, a bit of time to start to prepare and building on it.

Q: Speaking of building on new opportunities, a venture capital fund that IndiGo has decided to announce. You’re starting off small, Rs 7 crore, but what is this about? What is the bet that you intend to make?

A: Here we are becoming a global aviation player, which in itself in two days from now we’re celebrating our 17th anniversary. And I’m sure you’ve seen it going around. But I don’t think there’s many, if any airline in the world, which has grown in 17 years from basically one flight to 1850 a day and to this year, hopefully 100 million customers. But with that 100 million customers and that size of the operation, we’re in fact, expanding also and making sure that we work and collaborate with young, innovative new startups and companies.

And for that a fund like this could help us to work together to collaborate and to see for opportunities to continue to be ahead of the pack and prepare actually IndiGo for the next phase, which is not only domestic competition, but bringing IndiGo more to a global player and for that, I think India probably is one of the best places in the world to be with so much entrepreneurial spirits, IT spirits. People who started their own companies will help us to establish a more solid cooperation with some of these new startups. It’s a new era for us. Absolutely. But I guess it speaks to the entrepreneurship not only of India, but also very much of IndiGo.

Q: You preempted my question. So is the focus largely going to be on collaborating with startups in the tech space? Is this part of the plan to sort of plug gaps, if any, within the digitisation journey that you intend to take? What will be the specific focus areas?

A: We actually have not predetermined a specific focus area. The most important criteria is that it’s linked to the operation and the core business of Indigo itself. But with that, one could think about the operation at airports, one could think about our customer interface, one could think about the way we approach our customers. And again, here, obviously digital will offer us a whole range of new initiatives and the new opportunities and possibilities. And the whole world is coming to India for its digital enhancements. And actually, we’re living here. This is our home. So we’re in the right spot to build on that.

Q: Let me end by asking you, outside of the engineer issues, which you have spoken of, what would you count out or call out as possible risks today? And in terms of demand, as well as capacity what kind of pricing power does somebody like you enjoy today?

A: The demand is strong, and we expect it to continue to grow with the growth of the Indian economy and I think today, someone forwarded me a sort of risk of economic reduction of forecasts and where again, some countries were ranked high and India was ranked at the position of having a lower risk. So I think the whole outlook for Indian economy is pretty robust if you look to international analysts and reviews. Within the robust economic outlook, we can also feel that the demand outlook is strong and robust. Yes, there are seasonal patterns and yes, there will be fluctuations and there’s always fluctuations. But I think the foundations in itself are solid. You addressed the engine issue. That’s obviously something we keep a very close eye on. And we will make sure as we have done in the past that we can live up to our capacity guidance. And that is, I would say, our focus at this point in time. So I wouldn’t add anything to the point you’ve mentioned just underlining that that’s a point where we put a lot of efforts and a lot of focus in.

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index Price Change
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sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Oh! Calcutta owner Speciality Restaurants will open at least one restaurant every two months till Dec 2024

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

While speaking about the company’s plans on CNBC-TV18, Anjan Chatterjee, CMD, Speciality Restaurants, emphasised the strong performance in the third quarter and the importance of the delivery business to the company’s overall success.

[wealthdesk shortname=”Speciality Rest” isinid=”INE247M01014″ bseid=”534425″ nseid=”SPECIALITY” sector=”Hotels” exchange=”nse”] Speciality Restaurants, the operator of brands such as Oh! Calcutta, Mainland China, Asia Kitchen by Mainland China, and Sigree-Global Grill, plans to open 12-15 restaurants in the next 24 months, founder Anjan Chatterjee told CNBC-TV18 in an interview. These restaurants will be located in existing and newer tier-2 cities.

“Everything has been planned for the 12-15 restaurants coming up in the next 24 months. All this was done pre-pandemic. You will see a surge in terms of topline but profitable growth,” he said.

“We have planned 12-15 restaurants which will be brick-and-mortar ones. Additional would be the cloud kitchens. All this combined, you will see around 24 of these combinations coming in mainly in Asian cuisine,” Chatterjee, also the chairman and managing director, said.

The CMD said the company still sees huge potential in cities like Delhi, Hyderabad, Chennai, and Bengaluru. He said for tier 2, the company would look at Chandigarh, Guwahati, and Indore, among other cities. The company also operates in Qatar, UAE, and the United Kingdom.

This expansion for the fine dining restaurant operator comes after a period of restructuring, during which Speciality Restaurants closed non-profitable restaurants. He said the company is going through a phase of rebirth.

Despite the closures, Chatterjee said the company saw strong growth in the third quarter, with robust growth in both the dining and delivery segments. In fact, he said delivery now accounted for 25-27 percent of the company’s revenue, a figure that was boosted by the FIFA and T20 World Cups.

Also Read | Speciality Restaurants shares gain most in five months on fund raising proposal

To fund this expansion, Speciality Restaurants announced plans to raise funds through the issuance of equity shares or other eligible convertible securities. On December 21, the company’s board approved fundraising of Rs 127.2 core through the issuance of 60 lakh warrants convertible at Rs 212.05 per share.

Warrants would be issued to investors who aren’t promoters. After the conversion, the promoter stake is expected to dilute from 52.53 percent to 46.5 percent. The company would initially receive Rs 31.8 crore, and the balance Rs 95.6 core would be received in April 2023. The board also approved an increase in the company’s authorised capital from Rs 58 crore to Rs 67 crore. An extraordinary general meeting to discuss these plans will be held on Wednesday, January 18, 2023, in Kolkata.

The news of the fundraising plan boosted the company’s shares to a five-month high on December 19. While the stock has done well overall, on Friday it was trading 2.47 percent down at Rs 247.

While speaking about the company’s plans on CNBC-TV18, Chatterjee emphasised the performance in the third quarter and the importance of the delivery business to the company’s overall success. He used the term “revenge eating” to underline that the business is only set to grow from here.

For the entire interview, watch the accompanying video

Catch the latest stock market updates with CNBCTV18.com’s blog

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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NCC says order inflow from water, irrigation segment is strong

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

NCC has bagged five orders – in water, electrical and irrigation divisions – aggregating to around Rs 3,600 crore from the state government agencies for the month of December. “This year we made a good beginning. For the quarter three, we have bagged very good number of orders,” said Vijay Kumar, Head and VC-Finance at NCC while speaking to CNBC-TV18.

[wealthdesk shortname=”NCC” isinid=”INE868B01028″ bseid=”500294″ nseid=”NCC” sector=”Construction & Contracting – Civil” exchange=”nse”]

NCC has bagged five orders – in water, electrical and irrigation divisions – aggregating to around Rs 3,600 crore from the state government agencies for the month of December.

“This year we made a good beginning. For the quarter three, we have bagged very good number of orders,” said Vijay Kumar, Head and VC-Finance at NCC while speaking to CNBC-TV18.

Out of these five orders, two orders worth Rs 1,871 crore are related to the water division, two orders worth Rs 993 crore pertain to the electrical division, and one order worth Rs 738 crore is from the irrigation department.

The contracts need to be executed in a time span ranging from 18 months to 36 months.

Out of these orders, one order worth Rs 321 crore pertained to the electrical division, and the second order worth Rs 55 crore was for the roads division.

The order inflow for the current year is around Rs 12,000 crore.

Largely the orders have come from the water, electrical and irrigation segments. We are one of the front runners in Jal Jeevan Mission. We have these orders from Uttar Pradesh (UP), Karnataka and other states. Going forward, these segments are going to contribute a good chunk of revenue to the topline of the company,” he explained.

The company has one order from Brihanmumbai Municipal Corporation (BMC), which is sewage treatment plant in Malad. “That is of Rs 4,000 crore,” he said.

DAM Capital Advisors Limited and Yes Securities has ‘buy’ call on the stock.

In quarter one and quarter two, the company had clocked around Rs 3,000 crore of execution levels. “I expect the same execution level should continue. However in quarter three and four the execution levels will be a bit more because the activity will be more in last two quarters,” he said.

In the September quarter, NCC’s net sales increased to Rs 3,373.43 crore as against Rs 2,581.37 crore in the same period a year ago. The company’s net profit stood at Rs 137.54 crore.

The stock was up 9.30 percent in last one week and 14.10 percent in the past month.

For the full interview, watch the accompanying video

Check out our in-depth Market CoverageBusiness News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18CNBC Awaaz and CNBC Bajar Live on-the-go!

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Prestige Group plans to build and operate its own shopping centres, says more malls in the pipeline

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Motilal Oswal is bullish on Prestige Estates and the brokerage expects the 2023 calendar year to be a defining year for the company.

Prestige Estates plans to build, own and operate its own shopping centres and there are more malls in the pipeline, the group’s CMD Irfan Razack said. Last month, Prestige Estates opened its first large mall after the Blackstone Group transaction and it got the company good footfalls.

“Footfalls of around 100,000 people on a weekend is unheard of and that is Prestige Falcon City at Kanakapura Road and that mall is trading very nicely,” he told CNBC-TV18.

In terms of office rentals, the demand has come back. With this no-COVID situation, there is a push from all companies that everybody should start working from office, he said.  “The demand for office is back, the inventory is minimal, the vacancies are very minimal and the rentals have firmed up,” he added.

Prestige Group is one of the leading real estate developers in the country, with a track record of over three decades in real estate development. It has a diversified business model across residential, office, retail and hospitality segments with operations in 12 key locations in India.

The company has a very strong pipeline, which is making the management very confident. “First two quarters of this financial year did Rs 6,500 crore bookings and our target is around Rs 12,000 crore for the year which is Rs 2,000 crore plus from the previous year. We can beat that,” he said.

The company has lack of inventory in Bengaluru. “The inventory is less in Bengaluru and that is the reason why we are working hard to see that we get all our approvals and our RERA numbers are in place, so that the final quarter should be the best quarter that we have ever had,” he explained.

Motilal Oswal is bullish on Prestige Estates and the brokerage expects the 2023 calendar year to be a defining year for the company.

Prestige Estates has Rs 6,500 crore of inventory in ongoing projects and Motilal Oswal has raised their FY24 pre-sales growth estimates by 16 percent.

Also Read | Only way to develop Mumbai is through redevelopment, says Irfan Razack

“The inventory coming in from Bengaluru, large projects coming in from Hyderabad, Mumbai and the contribution from smaller cities such as Kochi, Calicut put together, 2023 will be a defining year for the company,” he said.

Motilal Oswal in its recent note mentioned that Prestige Estates could see Rs 15,000-17,000 crore of pre-sales in FY24. When asked if this is a reasonable assumption, he replied, “Rs 15,000 crore is a very reasonable assumption considering that we have a lot of stock in the pipeline and considering the market as well as there is a lot of dealer’s confidence in the company that we will deliver. Rs 15,000 crore for 2023-2024 is pretty easy.”

The stock was up 4.22 percent in last one week and down 6.03 percent in the past month.

For the entire interview, watch the accompanying video

Catch the latest stock market updates with CNBCTV18.com’s blog

Check out our in-depth Market CoverageBusiness News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18CNBC Awaaz and CNBC Bajar Live on-the-go!

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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today's market

index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Blue Star says no room for further AC price hike

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

 Listen to the Article (6 Minutes)

Summary

The company will look at the prices once the current quarter is over however it is not planning to increase the prices, said B Thiagarajan, Managing Director of Blue Star while speaking to CNBC-TV18.

[wealthdesk shortname=”Blue Star” isinid=”INE472A01039″ bseid=”500067″ nseid=”BLUESTARCO” sector=”Consumer Goods – White Goods” exchange=”nse”]

Blue Star has been increasing room air-conditioners’ prices for the past 24 months as raw material prices have escalated due to supply issues because of the China COVID-19 situation as well as the Russia-Ukraine war.  Therefore, the company has no plans to increase prices further, as per B Thiagarajan, Managing Director of the company, in the near future.

“The price increase had been there for the past 24 months. We have been increasing the prices and there is no room for increasing the prices further,” he told CNBC-TV18.

The company will look at the prices once the current quarter is over. For the summer season, a new range of products will be introduced

“These (new launches) will be in-line with our strategies – affordable premium range. We will go ahead and ensure that the products are optimized for various markets and segments. Therefore there is no question of a price increase from January 1,” the CEO explained.

The easing in commodity prices should also improve the margins in the second half of the current financial year. However, the rupee depreciation is offsetting the savings that have been achieved in the commodity prices.

“We continue to maintain the margins throughout the year. Despite the commodity prices escalation, the business segments are showing improved margins,” Thiagarajan mentioned.

Also Read | China COVID crisis: Worried over supply chain disruptions, consumer durable makers stock up on inventories

Channel checks by several brokerages indicate consumption has been declining to post the festive period owing to the overall inflationary environment. Checks also exhibit that a large part of the pain is being seen in the smaller cities.

While giving a ground check on how the demand is looking, the CEO said, “I do not see the slowdown in the segments that we operate. Take the room air-conditioners – given that the penetration is lower, the segment continues to do well.”

The demand holds and it will continue to build up to the summer season despite the energy level change which normally pushes up the prices.

Also Read | Chinese manufacturing weakens as country battles COVID-19 surge

More than 67 of the company’s sales comes from tier III, tier IV and tier V cities. “Due to the good agricultural income, we are beginning to see a surge in demand in the rural towns as well,” he said.

The stock was up 1.25 percent in the last week and down 1.35 percent in the past month.

For the entire interview, watch the accompanying video

Catch all the latest updates from the stock market here

Check out our in-depth Market CoverageBusiness News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18CNBC Awaaz and CNBC Bajar Live on-the-go!

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

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today's market

index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Phase 2 of wedding season likely to be very strong, says CAIT

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

 Listen to the Article (6 Minutes)

Summary

People now want to spend more. The destination wedding is growing at a fast pace. Therefore, there is tremendous demand at least for the next couple of years – for 2023 and 2024, said Praveen Khandelwal, General Secretary at CAIT.

[wealthdesk shortname=”Matrimony.com” isinid=”INE866R01028″ bseid=”540704″ nseid=”MATRIMONY” sector=”Miscellaneous” exchange=”nse”]

The season of big fat Indian weddings is underway. According to the Confederation of All India Traders (CAIT), a total of 32 lakh weddings have taken place till December 14 this year with Rs 3.75 lakh crore worth of expenditure. And phase two, starting from January 14, 2023, is expected to be very strong. Murugavel Janakiraman, Founder and CEO at Matrimony.com and Praveen Khandelwal, General Secretary at CAIT discussed more on the demand trends in this wedding season.

The first phase of Indian weddings ended on December 14, 2022, and the second phase will begin on January 14, 2023. India has crossed Rs 4 lakh crore of wedding expenditure this season. “Next phase, which is going to start from January 14, 2023, to July 15, 2023, is going to be a robust season and ultimately the economy will be benefited,” said Khandelwal.

According to a survey conducted by CAIT, in 35 cities, the wedding expenditure this season is going to be very high.

During COVID, there was a surge in the number of people signing up for matrimonial websites. However, the momentum did not continue.

“Post-COVID, we saw a drop in the number of people signing up. We didn’t have the similar kind of growth or uptick that we had during the COVID period,” said Janakiraman.

This had some impact on the growth of the business.

Next year, the growth is expected to touch the earlier level of growth, Janakiraman added.

According to Khandelwal, after two years of COVID, this is going to be a rising period for weddings for the next couple of years.

The number of invitees to weddings has gone down but the spending has been on the higher side.

People now want to spend more. Destination wedding is growing at a fast pace. Therefore, there is tremendous demand at least for the next couple of years — for 2023 and 2024, said Khandelwal.

For the entire discussion, watch the accompanying video

Check out our in-depth Market CoverageBusiness News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18CNBC Awaaz and CNBC Bajar Live on-the-go!

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

 Daily Newsletter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Previous Article

Oil Fluctuates as Traders Assess China’s Vow, Unrest in Libya

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LIVE TV

today's market

index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
Quiz
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Car buyers are a lot more wary now than during the festive period, says Sundaram Finance

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

 Listen to the Article (6 Minutes)

Summary

Andhra and Telangana are important markets not just for Sundaram Finance but for the CV manufacturing sector itself. said Rajiv Lochan, MD of Sundaram Finance

[wealthdesk shortname=”Sundaram Fin” isinid=”INE660A01013″ bseid=”590071″ nseid=”SUNDARMFIN” sector=”Finance – Leasing & Hire Purchase” exchange=”nse”]

The commercial vehicle (CV) space is directly tied to economic sentiments and through the festival season there was a terrific movement in the CV sector. While the momentum through the festival season continues, the buyers are a lot more circumspect, said Rajiv Lochan, MD of Sundaram Finance on Wednesday amid the rising rate environment.

“Our readings from the ground indicate that while we expected the momentum through the festival season to continue, buyers are a lot more circumspect in terms of asset prices that are now reached and the buyability of the assets itself,” he said.

Crude oil prices have dropped in the last few months, so buyability for many of the operators’ remains at the same level that it was when crude was not around $100 per barrel levels. This also forces buyers to be a lot more circumspect before making some of these large investments particularly in the M&HCV segment where asset prices are now not Rs 40 lakh – Rs 50 lakh.

“December 2018 was an all-time high in the Andhra market and our sense is we will probably, three quarters on the way, that is likely where we will end up given what we are seeing in the market right now,” he added.

The last few quarters have been strong for the vehicle finance sector as it has recovered from the downcycle of the commercial vehicle (CV) space in general, however, the broader automotive space has been patchy through four quarters.

Also Read: RBI Governor Shaktikanta Das says next financial crisis might emerge from cryptocurrencies

“Inflation continues to remain an important metric for policymakers, regulators and the government,” he noted.

Andhra and Telangana are important markets not just for Sundaram Finance but for the CV manufacturing sector itself. There are a large number of retail buyers in the segment and December tends to be a season when the buying tends to peak in Andhra and Telangana markets.

Last three years, there was a slowdown in the CV segment, so the Andhra market has been somewhat muted in December.

“Post festive there is always a slowdown and this year Diwali, Dhanteras being in October, November has been somewhat slower than normal but the December season in Andhra Pradesh and Telangana, which seems to be a bellwether for us, is somewhat muted and so it feels like a lot of the buying is replacement buying and not expansion buying,” he explained.

For the entire interview, watch the accompanying video

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

 Daily Newsletter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Previous Article

Oil Fluctuates as Traders Assess China’s Vow, Unrest in Libya

Next Article

Shanghai residents turn to NFTs to record COVID lockdown, combat censorship

LIVE TV

today's market

index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
Quiz
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Should Elon Musk be able to buy Twitter?

 5 Minutes Read

Deregulation of motor third-party premiums will have a big impact, says New India Assurance

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

 Listen to the Article (6 Minutes)

Summary

Going forward too, we expect health and motor to be the key growth drivers and there is a lot of scope for innovative products: Neerja Kapur, CMD, New India Assurance Co.

Q&A Transcript of Neerja Kapur, CMD, New India Assurance Co

Q: What’s happening on a business-on-the-business side? Premium growth in the last two quarters came down from 15 to 18 percent levels now to between 5 and 7 percent. This is lower than what the industry growth has been or what the peers have achieved. Could you tell us what’s currently happening and what could FY23 growth and beyond looks like?

A: India is one of the fastest growing economies in the world having clocked about 5.5 percent average gross domestic product (GDP) growth over the past decade. Economic growth in India is estimated to grow at about 6.9 percent in 2022-2023. And with a proactive set of administrative actions taken by the government, a flexible monetary policy, softening of the global commodity prices, also supply chain bottlenecks, we’re seeing them moving of, inflationary pressures have eased to some extent in India. So three mega trends, global offshoring, digitalization and energy transition are setting the scene for a good economic growth in the country as compared to the rest of the world. India has emerged as the fastest growing major economy in the world.

Q: In terms of New India Assurance itself if you can be a little specific in terms of what can we expect in terms of premium growth, as I pointed out, that has slowed down meaningfully, what’s your own understanding of how the numbers will progress from here?

A: We see a very good growth in the motor segment. And with the new vehicle sales showing a very healthy trend, we see the automobile sales increasing across all categories, and three of our biggest original equipment manufacturers (OEM) partners that is Maruti, Hyundai and Tata Motors, their sales are also at an all-time high compared to the previous year.

Health business continues to grow at a very healthy pace. And the predominant reason being the pandemic, which has made everyone more aware of life’s uncertainties.

We’re also seeing a lot of push from the IRDAI to cover the missing middle and a lot of action is happening in this scene.

Property is also witnessing a much better traction compared to the recent years.  It is mainly driven by the demand from residential and commercial segments. So, going forward too, we expect health and motor to be the key growth drivers and there is a lot of scope for innovative products. And New India Assurance as a company is targeting growth without compromising on our bottomline (the profit). We’re trying to increase our revenue but not at the cost of our margin.

Q: Since you’re talking about good growth in the motor segment, I wanted your thoughts on two things. One is deregulating the motor third party premium and the other one is making Accident Insurance mandatory.  How would this really affect or change your growth prospects?

A: This will really impact the segment and we expect to see a huge growth in the motor sector. In fact, we are seeing the motor segment growing at an extremely good pace. Like I mentioned earlier the automobile sales are increasing and the deregulation in the sense that all the companies are targeting the dealer business and getting our OEM partners – Maruthi, Hyundai and Tata Motors, whose sales are also at an all-time high. So we expect the segment to grow in a very healthy pace.

Q: Two things – one on the premium growth side, what should we expect over the next year out? Would you get back into the 15 percent or more kind of premium growth?

A: I would say yes. The industry as such is possibly growing in that segment. We are seeing till November, the growth in sales of the entire industry is at about 15 percent. Like I mentioned New India is focusing on growth with profitability only. So, we are focusing on the segment which would be less risk prone. And so, our growth would be or rather I would estimate it to grow in the range of about 8-10 percent.

Q: Quarter two combined ratio was at 121 compared to 130 in the previous quarter. This has also dropped to 109. Could you tell us where is this jump coming from and when can you get back to the 110 kind of levels?

A: Our combined ratio has shown an improving trend in the last few quarters. Like I mentioned, we are focusing on the profitable lines of business and we are trying to price the policies at the correct price rather than just focusing on discounts. So, you would definitely see a profitable growth and so, the combined ratio will be coming down in the quarters to come.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

 Daily Newsletter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Previous Article

Oil Fluctuates as Traders Assess China’s Vow, Unrest in Libya

Next Article

Shanghai residents turn to NFTs to record COVID lockdown, combat censorship

LIVE TV

today's market

index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
Quiz
Powered by
Are you a Crypto Head? It’s time to prove it!
10 Questions · 5 Minutes
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Win WRX (WazirX token) worth Rs. 1500.
Question 1 of 5

What coins do you think will be valuable over next 3 years?

Answer Anonymously

Should Elon Musk be able to buy Twitter?