BQuick On March 22: Top 10 Stories In Under 10 Minutes

Introducing Election Soundtrack, a daily podcast that’ll get you up to speed with everything that you need to know about Elections 2019.

This is a roundup of the day’s top stories in brief.

1. Ominous Signs Of Global Slowdown?

Bond yields around the world are tumbling to multi-year lows as the global shift by central banks to a more accommodative stance has put an end to long bull run in government debt.

The German 10-year yield slipped below zero percent largely due to the country’s manufacturing data slumping to over a six year low. This is important because Germany has been the growth engine for Europe and a drop in yields compounds fears of an economic slowdown in the region.

• Similar rates in Japan slid to their lowest since 2016 on Friday.
• Yields on benchmark U.S. Treasuries too have dropped to the lowest in more than a year.
• The global stock of negative-yielding debt hit the highest since mid-2017.

3. Alleged Yeddyurapa Diary Notings Spark Scam Scuffle

An investigative report by news magazine Caravan, that alleges payoffs worth about Rs 1,800 crore to top brass of the Bharatiya Janata Party, including Finance Minister Arun Jaitley and Transport Minister Nitin Gadkari, has sparked a fresh political debate ahead of the general elections.

• The Congress sought an investigation by the newly appointed Lokpal into a media report that alleged bribes paid by former Karnataka Chief Minister BS Yeddyurappa to the senior BJP leaders by citing personal diary entries.
• Yeddyurappa denied the allegations calling them “atrocious and malicious”.
• CBDT too refuted the report saying the “loose sheets” of paper they obtained were of “doubtful nature”.

CBDT said it had approached Yeddyurappa when it got photocopies of the diary entries.

4. How Airtel Topped Jio For First Time

January data shows that Reliance Jio continues to dominate subscriber growth in the telecom services industry.

Reliance Jio dominated growth by adding over 93 lakh new mobile customers versus Bharti Airtel Ltd.’s 1 lakh new customers. Read more about that here.

But Airtel is fighting back in a category that matters.

It added more mobile broadband customers than Reliance Jio Infocomm Ltd. for the first time since September 2016—when the Mukesh Ambani-owned telecom company commenced operations.

• India’s second-largest telecom company added nearly 1 crore mobile broadband users in January compared with Jio’s 93.2 lakh subscribers, according to data released by the Telecom Regulatory Authority of India.
• The company is also removing low revenue generating customers from its network to boost profitability.
• All of this is expected to boost its revenue in the ongoing quarter.

5. Ola Off Bengaluru Roads

The Karnataka transport department has suspended the licence of Ola in Bengaluru, one of its key markets, for six months as it illegally operated bike taxis in the state.

The cab aggregator cannot operate any vehicles, including cars, autos and bikes, in Bengaluru for six months, according to the suspension order issued by the Regional Transport Office on March 18. BloombergQuint has reviewed a copy

“This notification is unfortunate, and we look forward to an opportunity to address these concerns directly with state officials to find a solution for our driver-partners and millions of Ola users in Karnataka,” an Ola spokesperson said in a statement.

Read the full story here.

6. Tata-Mistry Spat: What Happened That Day

“I was stupefied,” says Mukund Rajan when Cyrus Mistry told him that he was being removed as the chairman of the Tata Group.

Rajan, who spent over two decades at the Group in various senior leadership roles, opens up in a new book titled ‘The Brand Custodian: My Years With The Tatas’. In a freewheeling chat with Harsha Subramaniam of Bloomberg News, Rajan offers a ringside view into the Ratan Tata-Cyrus Mistry spat, the role of Tata Trusts and much more.

It all started with a phone call for Mukund Rajan. Watch the full interview here.

7. Fiscal Slippage: The States Decide To Step Up

Ten of nineteen large states overshot their fiscal deficit projections in 2018-19 putting the cumulative budget gap at just under 3.3 percent of gross state domestic product, shows data compiled by SBI Economic Research.

But most of these states are targeting a narrowing of the fiscal deficit in 2019-20, shows the data.

• The revised fiscal deficit as a percentage of GSDP is estimated at 3.26 percent for 2018-19 and is seen dropping to 2.85 percent in the coming financial year, SBI Economic Research highlighted.
• The fiscal consolidation targeted by these states is significantly more than the central government, which, in its interim budget, had projected a fiscal deficit of 3.4 percent of GDP for 2019-20, unchanged from the year concluding March 31, 2019.
• All the states have projected a decline in fiscal deficit next year, except Odisha, Assam and Uttarakhand. Despite the increase, these three states are keeping the fiscal deficit below 3 percent.

Are states finally doing a better job than the Centre at fiscal consolidation?

8. Foreign Investors And Local Companies - Beware April 1

April 1, 2019 will usher in higher corporate governance standards for Indian listed companies and higher taxes for foreign investors coming to India via Mauritius and Singapore.

• The first is on account of changes to SEBI’s listing regulations and prevention of insider trading regulations.
• The second is a result of revisions in treaties with Mauritius and Singapore which give India a right to impose tax on capital gains.

Here are the slew of changes that domestic businesses and foreign investors need to gear up for.

9. Demand Rose After GST, But No One Knows Why

Consumer goods makers’ volumes jumped as the supply-chain emerged from the initial disruption of goods and services tax. There’s no consensus on why.

• Makers of soaps to biscuits say lower GST tax rates drove higher demand.
• But distributors and retailers aren’t sure if that was the trigger, and attribute it largely to a recovery after the twin disruptions of demonetisation and GST.
• The volumes jumped more on a lower base as the demand had slowed first because of demonetisation and then GST, four distributors and three retailers told BloombergQuint.

Is there a premiumisation versus formalisation trend unfolding?

10. What Mindtree’s Board Must Weigh

The substantive argument can only be around one question: does L&T’s proposition make sense for all stakeholders in terms of value creation over the long-term, writes Prabal Basu Roy.

• This should not be about emotions but a clinical evaluation of what is in the best interest of all stakeholders.
• VG Siddharta has been more than fair to the Mindtree founders and had provided enough runway to them on his intentions to exit.
• Mindtree has failed miserably, purely on matters of corporate finance, capital structure and investor strategy.

Here’s what Roy writes about Mindtree’s conundrum.