Archive: February 1, 2021

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Budget 2021- A bold budget in many senses – Mr. Abheek Barua, Chief Economist, HDFC Bank

Feb 1, 2021 by Rekha Nair 0 Comments #Chief Economist, #HDFC Bank, #Mr. Abheek Barua

A bold budget in many senses. The central intent has been to use expansionary fiscal policy to support growth sidestepping concerns over debt sustainability and sovereign rating. The fiscal deficit is pegged at 6.8% of GDP in FY22 compared to a revised estimate of 9.5% for FY21. The focus has been on increasing capital expenditure both by the centre (+35% y-o-y) as well as states. Moreover, the budget introduced new institutional structures (like the Development Finance Institution, asset reconstruction company) and provided greater detail on asset monetisation to finance infrastructure needs in the economy. In light of the COVID-19 health crisis, the budget’s focus on health and sanitisation with increased allocations and introduction of a new health scheme are also welcome steps.

That said, the budget does not adequately address concerns over inequitable growth which has been a worry across the globe due to the pandemic. There has been no specific support for sectors stressed due to the pandemic like the hospitality sector. While the government did not increase any direct taxes, as some sections of the market feared, there has also not been any cushion provided for households – especially in the informal sector that has been hit the most by the pandemic. Therefore, while the budget focusses towards pushing the long term growth potential it does little to prevent a K-shaped growth recovery.

For the bond market, a higher than expected market borrowing estimate (INR 12 trn) in FY22 and additional borrowings of INR 80,000 crores in FY21 are likely to add pressure on borrowing costs. The 10-year yield is up by 16bps since the budget announcement crossing 6%. Over the coming year, higher market borrowings, concerns over inflation and a move towards normalising liquidity conditions by the RBI could maintain pressure on yields. We see the 10 year between 5.95-6.10% by the end of H1 FY22.

Mr. Abheek Barua, Chief Economist, HDFC Bank

 

Business World

Budget Reaction from Indian Angel Network

Feb 1, 2021 by Neel Achary 0 Comments #budget

Raman Roy, Co-founder, Indian Angel Network

FM’s Budget High focus on COVID 19 Vaccine: 35k crores and can allot more: enable India to get back on its feet quickly. The announcement of pneumococcal vaccine rollout in more than 5 states will impact the health care system towards a healthier Atmanirbhar Bharat. The additional budget for urban health and wellness centres will provide the necessary boost.

Focus on Digital transactions will enable Startups to create unique solutions for Atmanirbhar India.

Saurabh Srivastava, Co-founder, Indian Angel Network

Budget’s focus on health, hygiene, clean air, water: will need innovative solutions, great opportunity for startups! Easing for one-person companies and size of small businesses boost for startups. Margin money for stand up India 25 to 15% is a welcome move. One Nation- One Ration vision is an aspirational project benefitting 86% beneficiaries. Incentivising digital payments will help Fintech players. Measures to facilitate contract disputes will help investors

Ajai Chowdhary, Founder HCL, Board member IAN & IC member IAN Fund

Budget focus to move India into global supply chain: welcome move towards Atmanirbhar India. Big boost for startups with re configuring of OPCs, redefinition of small businesses: brings ease of business under Atmanirbhar Bharat. The budget allocated for the agricultural sector will lead to infrastructural development and create opportunities for startups in the sector leading towards self-reliant India vision.

Padmaja Ruparel, Founding Partner of IAN Fund

The Budget 2021 opens up opportunities for startups across Health, Hygiene, Water, Clean air, Sanitation, etc. The vision of Atma Nirbhar Bharat with a focus on Good governance and Women Empowerment will lead to a boost for Indian Economy. The Indian Startups have a great opportunity to innovate and help to sustain the Indian Economy. Non-conventional energy boosted with focus on solar and Non-renewable sources.

Reopening of tax cases reduced to 3 years from 6 years and increased income limit of 50 Crs

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Orientbell Tiles registers revenue growth by +21 % y-o-y…

Feb 1, 2021 by Rekha Nair 0 Comments #Aditya Gupta, #CEO, #Orient Bell Ltd.

New Delhi: Orient Bell Ltd. today announced its unaudited financial results for the quarter ending December 31st, 2020. Revenue Growth in the quarter was 21% y-o-y led by the renewed focus on New Products, Displays and Channel Engagements compared to 6% y-oy of Q2FY21 spend.

EBITDA margin improved further to 10.7% in Q3FY21 aided by higher volumes, lower fuel costs and cost control excluding the impact of one-time adoption of IND AS 116” Lease Accounting” in Q3FY20, on a L-f-L basis EBITDA margin improved from 6.7% in Q3FY20 to 10.7% in Q3FY21. (Refer https://www.orientbell.com/investor for detailed results)

On a consolidated basis (including OBL’s share of profit from Associates), PAT for Q3FY21 at Rs. 7.5 Crores vs Rs.0.7 Crore in Q3FY20. With a continuous strong focus on Working Capital Management, Cash Conversion Cycle was reduced to 13 days on 31-Dec-2020 from 53 days on 31-Mar-2020. The Net debt was below zero as on 31st December 2020.

Q3FY21 saw an addition of 29 new Orient Bell Tile Boutiques (OBTB’s), with an increase in the total number of active OBTBs to 217 as on 31st December 2020. In addition to this, Marketing investments were increased further during Q3FY21: 2% of topline (~1.8X of Q2FY21 spend) and the revenue from vitrified tiles too improved to 41% vs 40% last year. OBL launched More than 350+ SKUs launched YTDFY21 across existing & New Product categories.
As part of the board meeting, OBL’s Board has approved modernization of an existing wall tile plant at Sikandrabad (Bulandshahr district, UP). The current capacity of this plant is 2.1 MSM p.a. and post modernization the capacity will increase to 2.8 MSM p.a. The modernization will also reduce fuel consumption.

“The modernization will involve a capex of under Rs. 10 Crores and the process will be completed by mid FY22. The CAPEX will be financed from internal cash accruals”, Aditya Gupta, CEO, Orientbell Tiles commented on the occasion.

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Budget 2021 focuses on infrastructure development – Amit Kapur, Joint Managing Partner, J Sagar Associates

Feb 1, 2021 by Rekha Nair 0 Comments

The budget speech expectedly has given a strong signal for infrastructure development focusing on actualizing the ambitious national infrastructure pipeline targeting an investment of Rs.111 lakh crores over 5 years. The signal comes from the announced budgetary allocations and decisions (a) central allocation of Rs5.54 lakh crores, (b) state allocations of Rs.2 lakh crores, (c) announcement to tap into budgetary resources of PSUs and wide ranging InVITs monetising assets in highways, power transmission, gas pipelines, dedicated freight corridors, airport. The above announcements are strengthened by announcement of establishing Bad Bank in nature of AMC; a development financial institution with a seed investment of Rs.20,000 crores and a target to be build a lending portfolio of Rs. 5 lakh crores in 3 years; an extensive disinvestment program with target of Rs.1.75 lakh crores; zero coupon bonds that will help arrange the infra financing. The devil lies in the details and the success in reviving the economy would depend on effective structural reforms in infrastructure sectors removing barriers to growth + how the government goes about monetising the land bank and assets held by PSUs. “Amit Kapur, Joint Managing Partner, J Sagar Associates

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Expectations From Union Budget 2021

Feb 1, 2021 by Rekha Nair 0 Comments

COVID-19 brought about a big setback in most of our lives in 2020. As we are slowly moving out of it, the Government should look at bringing down the personal income tax, thus giving more to the citizens. The existing personal tax slab may be slashed to increase liquidity for Indians.

Also the GST slabs may be restructured to 5%, 10 % and 15%. GST for the business services can be reduced to 10% from the existing 18%.

The Government should also look at unlocking the value of 67 sick PSUs, whose rehabilitation or winding up proposals have been referred to the Board of Reconstruction of Public Sector Enterprises.

CSR spend exemption may be considered for the next two fiscals due to the adverse impacts of COVID-19.

Measures to improve ease of doing business need to be implemented. Robust online payment gateways should be facilitated for payments to any government body.All tendering through State Public Works Department have to be made completely online to improve better governance. Audit measures have to be increased with effective penal measures.

Even labour law reforms should facilitate ‘ease of doing business’ and at the same time protect the genuine interest of the labourers. This may be facilitated through the creation of a central nodal agency that will hear their voices and will be vested with appropriate powers to take corrective actions. This assumes significance on account of the weakening of the Trade unionism in the country.

The expenditure on Members of Parliament Local Area Development Scheme may be stopped. These funds may be utilised for towards development of Integrated Child Development Scheme – Anganwadis.

Agriculture reform laws have to be implemented in order to protect the interest of the farmers. Also MNERGA expenses have to be more towards skill development initiatives inorder to produce skilled labourers. This in turn will address unemployment issues, improve employability and help meet the industry’s trained manpower needs.

NAGARAJ KRISHNAN
Managing Director,
Aparajitha Corporate Services Private Limited

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“A pragmatic & forward looking budget” says, Mr. Kaushal Agarwal, Chairman, The Guardians Real Estate Advisory

Feb 1, 2021 by Rekha Nair 0 Comments

It’s a pragmatic & forward looking budget, at the same time, the estimated, gradual reduction in the fiscal deficit from 9.5% to under 4.5% by 2024-25 will help boost consumption in the economy. The government’s big bet on infrastructure is bound to pay off in the long-term & will also catapult desired growth for real estate & the economy. The NPA’s of PSU banks have seen an encouraging reduction from 8.96 to 6.8 trillion by end of Fiscal 2020. The setting up of ARC & AMC for banks troubled with bad loans and NPA’s alongside the further recapitalisation of Rs.20,000 crores will help improve the lending capacity of the banking & financial sector. The government’s decision to extend tax holiday for affordable housing projects by another year is a step in the right direction to realise the PM’s dream of ‘Housing For All by 2022’.

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Post Budget 2021 Reaction : Technology, AI, Language, App store and startup

Feb 1, 2021 by Rekha Nair 0 Comments

The announcement of the National Language Translation Mission is a much needed effort by the government to reach our citizens in the language they understand. At Indus App Bazaar, the usage of apps in Indian languages on our platform has increased 2.2 times last year. We believe that with an enhanced app store ecosystem we will be able to break linguistic barriers and adding more value to the next half a billion Indian customers. Moreover, for Atma Nirbhar Bharat to be successful, the focus should be on technology innovation as a whole. We appreciate the government’s focus on innovation and R&D in the budget 2021.  – Rakesh Deshmukh, Co Founder and CEO, Indus OS

We do welcome the recent PLI scheme of the government. However, we need to ease up the duty imposed on raw materials keeping in mind the make in India thought. We should also be getting added incentives so that transformative measures can be taken. The industry contributes 25% of the country’s GDP. – Mr. Mike Chen, General Manager, TCL India

The annual budget brings in good news for Smart Class solutions. The Union budget has a major thrust on the education sector. The decision to strengthen 15,000 government schools provides a major avenue for Smart Class teacher-training solutions such as Onvu Learning. The decision to set up more than 100 Sainik and Eklavya schools with a 50-100% increased budget further opens up this sector for video-enabled teacher’s self-training solutions. – Mr. Abhishek Kumar, Regional Director, Onvu Learning

One of the key focus area in annual union Budget is on infrastructure. The decision to boost transport sector by allocating increased budgets for National Highways and Metros shall create opportunities for overview and incidence detection solutions. Oncam with its unique position in the market as the best overview surveillance solution is strategically placed to further increase its market share in roadways safety security solutions. The union budget is intelligently thought of and shall propel India as the fastest growing economy of the world. -Mr. Abhishek Kumar, Regional Director, Oncam

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A Pro-infrastructure and investment Budget

Feb 1, 2021 by Rekha Nair 0 Comments #Union Budget 2021

Dr. Samantak Das, Chief Economist and Head of Research, JLL India

Given that the economy is well on its path to recovery, Union Budget 2021 has focused on enhancing expenditure while keeping the fiscal targets at bay in the short term. This Budget focuses on augmenting infrastructure with a special focus on expediting urban infrastructure projects which will act as a strong catalyst in driving real estate in urban areas. There is also a continued thrust on the agriculture sector which is likely to result in higher incomes and drive consumption.

The proposed easing of restrictions on leverage by InvITs/REITs will attract more REITs listings and thus higher investments into real estate. The announced monetisation of surplus land of government and government bodies is a welcome move; however, the implementation will need to be monitored.

While the government has not announced any significant fresh policies and / or programs pertaining to real estate, its commitment towards boosting affordable housing remains intact. The Budget has extended the benefit of additional interest deduction on home loans for first-time homebuyers in the affordable segment. Further, there is a time extension to claim the tax holiday on profits from affordable housing projects until March 2022. The government continues to promote affordable rental housing schemes by providing tax exemption for notified rental housing projects. This will accelerate the pace of investments in this scheme and is likely to fall in line with achieving the overall objective of Housing for All.

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A boost from the budget for startups is Crucial – Joji George, Co-Founder, Gonuts

Feb 1, 2021 by Rekha Nair 0 Comments

The Budget 2021 announced by Hon’ble Finance Minister today though positive left us wanting some more from a start-up and MSMEs perspective. That said, the budget did reflect the Indian Government’s commitment to boost the Indian start-up ecosystem.

A boost from the budget for startups is important as it carves the next phase for the startup ecosystem post the pandemic. The government’s decision to bring in institutional investors to invest in startups is a positive move and will help encourage more investment into the startup community. Of course, the start-up community need to see and understand the fine print.

FM has announced, registration of one-person firms with no limit to paid up capital will boost the start-up ecosystem. That helps small entrepreneurs to take the leap.

Government has doubled its expenditure allocation towards micro small and medium enterprises to Rs 15,700 crore in FY22. This is an excellent move for companies like us that work with large number of MSMEs.

Another boost offered by the government is extension of tax holiday for start-ups by one more year. This will help get startups on their feet as they grapple with cash flow and investment.

In the near future, we would want the FM to give a concrete plan on ESOP taxation and hope that the initial deliberation of a 5 year term to pay tax on ESOP is implemented and there is a rationalization.

We welcome this budget and appreciate the Government’s steps to fuel the growth of start-ups in India

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Dr. G.S.K. Velu appointed as new Chairman,FICCI Tamil Nadu State Council for the year 2021

Feb 1, 2021 by Rekha Nair 0 Comments #Chairman and Managing Director, #Dr. G.S.K. Velu, #Neuberg Diagnostics and Trivitron Healthcare

New Delhi: Renowned healthcare entrepreneur, Dr. G.S.K. Velu has been appointed as the Chairperson of Federation of Indian Chambers of Commerce and Industry (FICCI), Tamil Nadu State Council. Prior to this, he co-chaired the FICCI Tamil Nadu State Council.

Driven by the vision to make medical technology, expertise and quality healthcare available to all, Dr. Velu has been promoting high-value health technology and diagnostics offerings through his business initiatives. Currently, he isthe Chairman & Managing Director at Neuberg Diagnostics, a global pathology brand operating in India, UAE and South Africa; Chairman & Managing Director at Trivitron Healthcare, a prominent medical technology company; Mentor & Shareholder at Kauvery Group of Hospitals, a chain of multi-specialty Hospitals; Chairman at Maxivision Eye Hospitals, a national chain of eye care super-specialty hospitals; Founder & Director at Apollo White Dental & Apollo Dialysis; and Anchor Investor at Stakeboat Capital, a private equity fund. He is also the Honorary Consul to The Republic of Estonia in India, wherein the Honorary Consul jurisdiction states include Tamil Nadu, Kerala, Andhra Pradesh and Telangana.

Expressing gratitude and talking about his role, Dr. GSK Velu, Chairman and Managing Director, Neuberg Diagnostics and Trivitron Healthcare said, “I am thankful for FICCI’s vote of confidence in appointing me as the Chairperson of FICCI Tamil Nadu State Council. This position gives me an opportunity to work within the FICCI framework in meeting its objectives of industry growth at one level, and the nation’s growth at another. I look forward to engaging with industry leaders to foster an ecosystem of innovation and growth, and towards building consensus between the industry and the policymakers.”

With more than 33 years of experience in the healthcare and diagnostics industry, Dr. Velu’s contributions and prominence in the healthcare sector has been recognized and received globally. He has been bestowed with several awards and accolades which are a testimony to his hard work, dedication and, his vision of making access to affordable quality healthcare, a reality.