BQuick On March 25: 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.

2. Congress Promises Income Transfer Five-Times Bigger Than BJP’s

The Congress pledged to guarantee a minimum income of Rs 12,000 a month per family if voted to power in the Lok Sabha elections due in less than two months. The party estimates that five crore families earn less than that, and the scheme will make up the difference.

• Describing it as the world’s largest minimum income plan, Rahul Gandhi said 20 percent of poor families across the country would receive Rs 72,000 annually if the party comes to power.
• Congress leader Rajeev Gowda explained in a tweet that the poorest families have an average income of Rs 6,000 per month and the ‘Nyunatam Aay Yojana’ or NYAY will give them an “unconditional transfer of Rs 6,000 per month”.
• This will be seen as an answer to the various populist sops announced by BJP in its final budget—a income support scheme offering Rs 6,000 a year to small farmers (PM Kisan), a restructured pension scheme of Rs 3,000 a month to informal workers, and a tax rebate for those earning up to Rs 5 lakh.

Congress’ proposal could cost the exchequer up to Rs 3.6 lakh crore per annum approximately.

3. India Believes This Video Game Creates Psychopaths

India’s passion for popular computer games is nowhere close to that of the U.S. or Japan. But now one of the industry’s kill-or-be-killed titles has become a smash hit -- and the backlash from the country’s traditionalists is ferocious.

• PlayerUnknown’s Battlegrounds a.k.a PUBG is a game where 100 players face off with machine guns and assault rifles until only one is left standing.
• But the world's most popular smartphone game is facing resistance in India. Multiple cities have banned it and police in western India arrested 10 university students for playing.
• The national child rights commission has recommended barring the game for its violent nature.
• One of India’s largest Hindi newspapers, Navbharat Times, declared PUBG an “epidemic” that turned children into “manorogi,” or psychopaths.
• A clinic for breaking digital addictions is recording several PUBG addiction cases every week.
  

Should India regulate gaming? Read this.

4. India Market Recovery: Too Much? Too Fast?

Just a few weeks ago, Indian stocks suffered from their worst run of losses in almost eight years. Fast forward to now and the S&P BSE Sensex Index has rebounded 8 percent.

• The gauge has gone from being one of the worst in Asia last month to the best, as the market has regained almost $220 billion since a low in February.
• Foreign investors came flooding back, with more than $3.8 billion of inflows in March alone -- set to be the most in two years. Is this too fast too soon? Perhaps.
• A sign that the equity surge could be reaching its tipping point is that the index is now around 5 percent above its 50-day moving average. The last two times the divergence reached such levels -- in the summer and at the beginning of last year -- the market slumped.

Market watchers are skeptical and cautious. Here are some charts that show why.

6. What’s Distorting Stock Prices At Relisting?

Arvind Fashions Ltd., the retailing arm carved out of the Lalbhai Group, relisted on stock exchanges at about Rs 590 apiece, and then surged the maximum 5 percent allowed in a day. An ideal trading debut—only, it wasn’t.

• The listing price was about half the lowest expected price that BloombergQuint had calculated based on valuations forecast by analysts.
• Demergers and mergers are now at risk of price discovery at the time of call auction, said VR Narasimhan, former chief of regulations at the National Stock Exchange of India Ltd., the nation’s largest bourse.
• The levels of price discovery that an IPO undergoes are missing in case of relistings, said a banker at a boutique investment bank.

Spencer’s Retail faced the same problem.

7. Rupee Rally: Fickle Gains Or Supportive Fundamentals?

Some factors may prove to be fickle but others are fundamentally supportive of a more stable Indian currency. Stable. Not stronger or weaker, writes Ira Dugal.

• While the surge in equity flows has been more dramatic, it is interest in the debt markets that may prove to be more long lasting.
• Stronger portfolio flows and more conducive policies for external borrowings have also helped improve the view on the country’s balance of payments.

If you look beyond the near-term, two broader concerns about the Indian currency are getting addressed.

8. Accreditation Of Investors In Startups: Will It Work?

Will the ‘accredited investor’ approach help startups access more capital, and fix the Angel Tax problem as well, asks Umakanth Varottil.

• SEBI’s approach towards investor accreditation is both over-inclusive and under-inclusive.
• In using the same tool, i.e. that of accreditation, to address different concerns, one must not lose track of the divergence of objectives in the process.
• Excessive regulation of investors and imposing disproportionately high burdens on investors would hamper rather than nurture the startup sector.

DPIIT would do well to harmonise its requirement for unlisted companies with those that SEBI has set out.

9. Trump’s Partial Victory Lap

President Donald Trump scored a significant political and legal victory on Sunday after Attorney General William Barr said that Special Counsel Robert Mueller’s investigation into the 2016 presidential election found that Trump and his aides didn’t conspire or coordinate with Russia to sabotage the campaign.

Trump, jubilant, took to Twitter on Sunday evening to celebrate. But afforded the opportunity to take a victory lap, he still couldn’t avoid misrepresenting what the Mueller report actually said, writes Timothy L. O'Brien.

• Barr had observed that Trump may have acted to obstruct justice but proving that and convicting him wouldn't be an airtight possibility.
• Still, if the report conforms to Barr’s description of it, then one of the president’s favorite talking points — “No collusion!” — now has the added strength of federal law enforcement’s endorsement.

This may not be the end of Trump and his family’s intersection with possible jeopardy.

10. What Rajat Gupta’s Wife Warned Him About

Rajat Gupta, feted business guru turned convicted felon, says he should have trusted his wife’s instincts about tangling with the world of high finance.

“These aren’t our people,” the former McKinsey & Co. managing director and former Goldman Sachs Group Inc. director says his wife would tell him. “You’re too trusting and you think everyone will be nice to you. Financial people are different than consultants. They’ll eat you for lunch!”

• The incident is part of Gupta’s memoir, "Mind Without Fear", where he returns time and again to the theme of misplaced trust.
• He rues his unpreparedness for the winner-takes-all realm of finance that he says was so different from the sheltered life he led at McKinsey.
• The memoir comes just months after a federal appeals court declined to throw out Gupta’s 2012 conviction.

Rajat Gupta get candid about achieving the American dream...and then seeing it unravel.