Business News at 10:00 am on 13th February, 2024

Let’s begin, with the Reserve Bank of India’s crackdown on Paytm Payments Bank on January 31, for not complying with regulations, downloads of rival BharatPe and MobiKwik have seen a significant surge in new merchants onboarding their platform. For instance, merchant sign-ups on BharatPe’s platform have doubled in the first week of February, compared to a similar period in January. Particularly in metros, merchant sign-ups are up 104% over the first week in January, while those in tier 2 and 3 cities jumped 95%, industry sources said. Meanwhile, MobiKwik saw a rise of 50-60% in new merchants onboarding its platform so far this month, compared to a similar period in January.

Up next, Travel-tech platform Oyo’s lead bankers and senior executives recently met officials at the Securities and Exchange Board of India to provide an update on the company’s business, in an attempt to expedite its IPO approval, sources said. Oyo officials informed the regulator about a partial prepayment of $200 million of the company’s outstanding term loan B from its books. They also gave an update on the company’s financial parameters in the last four quarters. Oyo has ⁠⁠offered to work closely to clear all Sebi queries promptly and has also indicated that capital market conditions are conducive to go public, sources said. Besides Oyo, startups such as FirstCry, and Ola Electric are also expected to go public this year.

Moving on, Reserve Bank of India Governor Shaktikanta Das on Monday said there will be no review of the restrictions imposed on Paytm Payments Bank for regulatory violations, as the move was in the best interest of customers. “We take decisions after a lot of consideration and analysis, which is often for months and years. If you are expecting a review of the decision (against PPB), let me very clearly say there is no review of the decision,” Das said. “There is nothing on the table on the review of the decision. When we make a decision, we examine all pros and cons,” he emphasized.
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“Meanwhile, the government aims to offer skills training to 30 million rural women, who are members of Self Help Groups, under its ‘Lakhpati Didi’ scheme so that they can earn an annual income of at least Rs 1 lakh. Banasree Purkayastha looks at how this initiative can help rural women achieve financial freedom and raise female participation in the labor force. In interim Budget speech, Finance Minister Nirmala Sitharaman said the plans to raise the target for the number of women trained under the ‘Lakhpati Didi’ scheme to 30 million from existing 20 million. PM Modi had first announced in his Independence Day speech that the government is working with women’s SHGs to create 20 million ‘Lakhpati Didis’ across India.

Moving ahead, A new law that mandates that any payment made to registered micro, small or medium enterprises beyond 45 days of receiving goods or services will not be recognised as an expense and added to the profit of the company for taxation purposes has caused a significant discomfort amid the organized apparel retailers, top sources told FE. “Essentially, the amendment, which was introduced recently to the Finance Act 2023 under Section 43B, stipulates that payments to registered MSME suppliers beyond 45 days will be added to the profit of the company instead of being treated as an expense,” says Rahul Mehta, Chief Mentor of Clothing Manufacturers Association of India.

In other news, Amid weak private consumption and uncertainty of a pick-up in private investments, economists say that the Reserve Bank of India’s assumption of a 7% GDP growth in FY25 seems “optimistic”. Most economists have pegged next year’s growth around 6.5%. In the current financial year, India’s GDP is expected to grow at 7.3%, according to the first advance estimates of the National Statistical Office. Sudipto Mundle, chairman at Centre for Development Studies, said that the private investment cycle has not yet kicked in, which poses a major downside risk to growth next year. The interim Budget pegged the Centre’s capital expenditure target for the next fiscal at `11.1 trillion, up 17% from the revised estimate of `9.5 trillion.

Lastly, GIFT Nifty indicated that Indian equity indices BSE Sensex and NSE Nifty 50 may see a positive opening on Tuesday. GIFT Nifty traded higher as the index was up 64.50 points or 0.30% at 21,757.00 indicating a positive opening for domestic indices NSE Nifty 50 and BSE Sensex on Tuesday. Previously, on Monday, the NSE Nifty 50 lost 166.45 points or 0.76% to settle at 21,616.05, while the BSE Sensex closed 523.00 points or 0.73% lower to 71,072.49. Some of the key stocks to watch in trade are Hindustan Aeronautics Ltd Reliance Industries, GlaxoSmithKline Pharmaceuticals, NHPC, Bharat Heavy Electricals, Bombay Burmah Trading Corporation, Dynamatic Technologies, Coffee Day Enterprises, Deccan Cements, BPL, and Career Point among others.