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Morning Scan: All the big stories to get you started for the day

A round-up of the biggest articles from newspapers

September 11, 2023 / 08:20 AM IST
Morning Scan

Morning Scan

#1. India calls for virtual G20 meet in November to assess progress on Delhi Declaration

While passing the G20 presidency baton to Brazil, Prime Minister Narendra Modi suggested that a virtual session of the bloc could be held at the end of November to discuss progress on proposals made at the New Delhi summit. He also said the permanent membership of the United Nations Security Council needs to be expanded.

Why it’s important: Only about half of the commitments made at the annual G20 meetings in the past 15 years has been met in full. A mid-term assessment could be a good way to ensure a better outcome.

#2. India to evaluate recommendations of report at G20 meeting on crypto assets

India will evaluate the suggestions made in a paper by the International Monetary Fund and Financial Stability Board outlining a roadmap for regulating crypto assets and integrating digital assets into financial systems before deciding its stance, economic affairs secretary Ajay Seth said.

Why it’s important: India has been for long advocated global regulation, oversight, and supervision for unbacked crypto assets. The G20 report advocates regulation over a blanket ban, endorsing India’s view.

#3. Private equity investors in advanced talks to buy minority stake in JSW Neo Energy

TPG, Tokyo Electric Power Company and Brookfield are in advanced discussions to buy a minority stake in JSW Neo Energy. The arm of listed JSW Energy may sign a deal with two of these funds in the coming weeks. The JSW Group is looking to raise up to $500 million from the stake sale.

Why it’s important: The conglomerate is expected to use the money to expand its renewables footprint as the green energy transition in India gathers pace, providing opportunities for sustainable growth.

#4. Earthmoving firm JCB to manufacture hydrogen engines in Haryana factory

UK-based JC Bamford Excavators, which makes earthmoving and construction equipment, plans to begin manufacturing hydrogen-powered engines at its Haryana factory soon after its commercial adoption in the UK. Its Ballabhgarh plant ideal for this purpose as it already makes diesel engines for the parent’s worldwide operations. India continues to be the most important market for JCB, chairman Anthony Bamford said.

Why it’s important: JCB has debuted a new hydrogen-powered engine in March, part of its initiative to create zero-carbon solutions in construction and farm equipment. Manufacturing these engines in Haryana could have a multiplier effect in India on this eco-friendly alternative to diesel.

#5. Promoters of Torrent may pledge stake in power arm to fund Cipla acquisition

The promoters of Torrent Group may raise funds from foreign banks to acquire rival Cipla by pledging a portion of their stake in Torrent Power. They hold a 53.6 percent stake valued at Rs 18,643 crore. Torrent would need about $7.3 billion to acquire a 33.5 percent stake in Cipla and make an open offer for 26 percent, assuming 100 percent subscription at current market price.

Why it’s important: Torrent’s promoters are yet to pledge their stake in listed firms, giving them the flexibility to raise funds through that route. The Cipla buy would the largest in the pharma space in India.

#6. Smaller Indian firms step up action on the mergers and acquisitions front

Indian companies are increasingly snapping up domestic assets on the block, often beating private equity firms, a trend that is expected to continue on the back of strong balance sheets. Although much of the local consolidation was earlier led by large conglomerates such as Reliance, Tatas or Adani, many mid-sized corporations have stepped up to widen their footprint and capabilities through acquisitions in recent years.

Why it’s important: Besides large conglomerates, private equity investors have traditionally dominated M&As. The increasing participation of mid-sized firms in the space has changed this dynamic and this trend seems to be continuing.

#7. Dream Sports revamps top leadership of cricket start-up Rario

Technology firm Dream Sports, parent of fantasy sports platform Dream11, has chief executive Ankit Wadhwa and chief technology officer Sunny Bhanot from their roles with immediate effect. Wadhwa and Chanot were co-founders of Digital Collectibles, which operates Rario, a cricket non-fungible token startup in which Dream11 had invested last year.

Why it’s important: Non-fungible tokens have emerged as a key technology to represent ownership and authenticity of a diverse set of assets. Dream11 wants a share of the emerging pie by asserting its ownership of Rario.

#8. Industry grouping sees $500 billion opportunity in biofuel alliance

The biofuel alliance can generate opportunities worth $500 billion in the next three years for G20 countries, according to a report by the Indian Biogas Association. Biogas can generate an opportunity of $200 billion, considering the least investment required, compared to other energy generation options and easy availability of raw materials, the industry association said.

Why it’s important: There has been a recent buzz around biofuels as a key component of energy transition. The industry lobby’s outlook could be overly optimistic, but the business opportunity is undeniable.

#9. Next 4-5 years vital for India to fill gaps in supply chains, says World Bank president

India has got a lot of things right, World Bank president Ajay Banga said while on a visit to the country to attend the G20 summit. He is more optimistic about the country economically than he was 20-30 years ago, Banga said, also speaking about the changing vision of the World Bank, climate finance, the Delhi Declaration consensus and India's trajectory.

Why it’s important: India has to make sure it is seen as a viable alternative to other nations that are also fighting to get into the global supply chain. The government seems to be making the right policy moves in that direction.

#10. Debit card transactions remain muted even as UPI payments see whopping growth

Debit card payments remained sluggish due to the surge in digital transactions after the pandemic, and the Unified Payments Interface has emerged as the most popular mode of money transfer, Reserve Bank data show. In July 2020, total debit card spends was Rs 2.81 lakh crore, compared to Rs 3.15 lakh crore in July, a growth of 11.96 percent. In contrast, UPI spends have seen growth of 428 percent from Rs 2.9 lakh crore to Rs 15.33 lakh crore in the same period.

Why it’s important: The success of UPI has been phenomenal, particularly for small-value transactions. It has also hastened the formalization of Indian economy that is dominated by tiny businesses.

Moneycontrol News
first published: Sep 11, 2023 08:20 am

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