Business News at 10:00 am on 5th April, 2024

Let’s begin with the major update, troubled edtech major Byju’s on Thursday sought arbitration as a way to resolve the dispute with a group of investors, filing an application with the National Company Law Tribunal (NCLT). The company cited the arbitration clause in its agreement with the investors, saying such disputes should ideally be adjudicated through that process. The investors have been directed to respond to Byju’s plea and the next hearing is scheduled for April 23. Meanwhile, the investor group which includes Peak XV Partners, General Atlantic, Prosus, and Safina has levelled fresh accusations against the edtech major. The company, they said, had declared the outcome of the extraordinary general meeting (EGM) on March 29, to increase the authorised share capital. Moving on, giving a temporary relief to forex traders that could lead to significant reduction in the impact cost and cool down the exchange-traded currency derivatives market, RBI on Thursday deferred the implementation of new rules for foreign exchange derivatives to May 3. The move by the central bank is aimed at giving more time to market participants who could not unwind their currency derivatives positions by April 4, said experts. In a notification, RBI said that the decision to defer it was taken ‘in view of feedback received and recent developments’. The revised rules, which were set to come into effect from April 5, were aimed to ensure that ETCDs can only be used for hedging purposes. In other news, India’s unicorn story may have slowed down and a large number of start-ups may be freezing in the funding winter, but there is a good story unfolding as well. The number of startups that have shut shop fell by a whopping 73% in 2023 compared to 5,640 in the previous year. According to data provided by Tracxn, only 1,514 startups have ended up in the `dead pool’ – euphemism for shutting down in the start-up world – in 2023. In 2021, the number was 4,424. Some of the companies that ended in the dead pool in the past years include Zipgo, Niki, GramFactory and Crater.Club among others. Market experts believe that these are signs that the industry is maturing and access to capital continues. Meanwhile, the Indian Commercial Pilots’ Association and the Indian Pilots’ Guild have written to Tata Sons chairman N. Chandrasekaran, expressing their support for the demands of Vistara pilots while also highlighting concerns about pilot safety. In the two-page letter shared on Thursday, the unions, which are some of the biggest pilot unions in India, said, quote, The concerns expressed by the Vistara pilots are not isolated incidents but rather indicative of systemic issues that extend across various Tata Group aviation entities, unquote. After several of its pilots refused to come to work en masse, Vistara, since March 31, has seen at least 155 flight cancellations, inconveniencing scores of customers and forcing the regulator, the Directorate General of Civil Aviation (DGCA), to step in. Up next, dairy and beverages maker ITC Foods is gearing up for volume-led growth in FY25 on the back of commodity pricing stabilising, an expanded summer portfolio, and enhanced reach in smaller geographies, COO Sanjay Singal told FE. Quotes, In the last few months, prices of milk have come down after going up by at least Rs 10 per litre. The retail prices won’t go up any further since raw material prices have stabilised now, unquote, he said. According to NielsenIQ, volume growth in the food sector during the October-December quarter stood at 5.3%, down from 8.7% in the July-September quarter of 2023. Although categories, including dairy and beverages faced inflationary headwinds last fiscal, Singal pointed out that there have hardly been any price increases. Moving ahead, fast-moving consumer goods (FMCG) companies may have to contend with slower topline growth in the March quarter of FY24 as demand trends have remained sluggish, companies as well as analysts said. On Thursday Dabur said it expected mid-single digit percentage revenue growth in Q4FY24 compared to a 7% rise in the December-quarter and 7.3% jump in Q2FY24. Dabur’s shares fell 4.5% and were on track for their worst day since May 2023, closing at Rs 505.95 on the BSE, down 4.77% over Wednesday’s close. Gross margin expansion may also be weak during the quarter as input prices have turned inflationary, experts said. The trend marks a reversal from the past few quarters when commodity inflation was largely benign. Lastly, let’s take a look at stocks to watch today. GIFT Nifty indicated that Indian equity indices BSE Sensex and NSE Nifty 50 may see a muted opening. GIFT Nifty traded lower as the index was down 67 points or 0.30% at 22,580.00 indicating a weak start for domestic indices NSE Nifty 50 and BSE Sensex on Friday. Previously, on Thursday, the NSE Nifty 50 gained 80 points or 0.36% to settle at 22,514.65, while the BSE Sensex closed 350.81 points or 0.47% higher at 74,227.63. Here’s a look at the key stocks to watch in trade — Muthoot Finance, Nestle India, Vedanta, Dabur, Bajaj Finance.