Finly November 2021

FINLY

NOVEMBER 2021 | Issue No. 105

Pandora Papers: The Largest Leak of Offshore Data Intriguing Indeed

Sector Analysis

What is a REIT and how does it work?

Steel Industry

Eco Section Increasing Influence Of Dollar On Global Trade

CONTENTS 01

02

ED ITO R IAL

TEAM F INL Y

04

09

C O VER ST O R Y

EC O SEC TIO N

Pandora Papers: Largest leak of offshore data

Increasing influence of Dollar on global trade

13

19

SEC T O R ANAL YSIS

C O MPAN Y AN ALYSI S

Steel Industry

Jindal steel & Power

24

29

INTR I GU ING IND EED

EN TR EP R ENEUR SHIP INNO VATIO N

What is a REIT and how does it work?

Dunzo

32

35

PER SO N I N F O C U S

C ALL F O R AR TIC L ES WINN ER

Sir Richard Branson

Krittika Tewari

38

42

C ALL F O R AR T IC L ES R UNNER UP

ALU MN I INSIGHTS

Chetansi Nanavati

Jagdish Bang PGDM FS| Finstreet 2016-2018

ISSUE NO. 105, NOVEMBER 2021

Dear Readers,

Editor's Note

“Historically, pandemics have forced humans to break with the past and imagine their world anew. This one is no different. It is a portal, a gateway between one world and the next. We can choose to walk through it, dragging the carcasses of our prejudice and hatred, our avarice, our data banks and dead ideas, our dead rivers and smoky skies behind us. Or we can walk through lightly, with little luggage, ready to imagine another world. And ready to fight for it.” - Arundhati Roy This pandemic is an opportunity to expand our knowledge by finding new ways to circumvent the circumstances, invest in the most intuitive ideas that come to our mind and surpass this havoc. As Ben Franklin rightly said, “An investment in knowledge always pays the best interest,” we at Finstreet are back with the next edition of our monthly magazine “Finly” for the academic year 2021-22.

Team FINLY has always been a dedicated group of people who put in a lot of time and effort to put this magazine together, and we can't thank them enough for their unwavering support and initiative.

The November's edition’s cover story tries to understand the Pandora Papers: Largest leak of offshore data. The intriguing indeed article goes through the interesting topic of REIT. We are thankful to Prof. (Dr.) Pankaj Trivedi (Course Coordinator, PGDM Core and Faculty Coordinator, Finstreet) for providing the much-required mentoring, support and backing to the Finly team.

We thank all our readers and faculty members for their valuable reviews and feedback.

HAPPY READING!!!

STAY HOME STAY SAFE!!!

Anusha Nair |Editor-in-Chief| MBA FS

Riya Agarwal |Editor-Finly| MBA FS

01

ISSUE NO. 105, NOVEMBER 2021

TEAM FINLY Faculty in-charge

Dr. (Prof) Pankaj Trivedi

Editing Team Editor-in-Chief

Editor - FINLY

Anusha Nair

Riya Agarwal

Team Coordinator

Anshul Sharma

Conceptualization & Design

Anshul Sharma

Moumita Biswas

Abhijeet Upadhyay

02

Content Team

Anirudha Kulkarni

Anupreet Lall

Jonath Simon

Kartik Anand

Muskan Jain

Priyanka Acharekar

Tanisha Chaudhary

Tuneer Sarkar

Upendra Baliga

Varun Nagur

Vidyathmika S

Viram Vora

03

| COVER STORY

PANDORA PAPERS: THE LARGEST LEAK OF OFFSHORE DATA Tuneer Sarkar | MBA-DSA | 2021-23 Jonath Simon | MBA-FS | 2021-23 WHAT IS THE PANDORA PAPERS LEAK? Years after the Panama leak, a new leak named the Pandora Papers were leaked to the International Consortium of Investigative Journalism (ICIJ), which contains almost 12 million documents that expose how some of the powerful and influential people of the world use secret offshore companies to hide their wealth and avoid paying the fair taxes. These confidential documents shed light on the offshore activities of Jordan's King Abdullah II, Ukraine's, Kenya's, and Ecuador's presidents, the Czech Republic's prime minister, and former British Prime Minister Tony Blair. The documents also reveal the financial dealings of Russian President Vladimir Putin's "unofficial minister of publicity" and over 130 billionaires from Russia, the United States, Turkey, and other countries. Around 600 journalists from 150 media houses worldwide have decided to

launch a two-year-long effort to investigate the 11.9 million leaked documents.

Source: International Investigative Journalists

Consortium

of

According to ICIJ, "The records include information about the dealings of nearly three times as many current and former country leaders as any previous leak of documents from offshore havens." The files reveal how people have set up complicated multi-layered trust arrangements for estate planning, but they are shrouded in secrecy.

The examination of the documents reveals

04

| COVER STORY two goals for establishing the trusts. These are used to (a) conceal real identities, making it an arduous task for tax authorities to locate them. (b) protecting their assets, such as cash, real estate, and stock, from creditors and law enforcement.

Setting up such trusts is relatively easy, cheap, and sometimes even legal. In addition to minimal or non-existent tax rates, such jurisdictions have laws that shield the owners' identities, making it difficult to determine whether they are using companies to hide assets from tax collectors, creditors, or law enforcement agencies. Some of those jurisdictions are on islands, such as Anguilla or the Bahamas, while others are in landlocked places like South Dakota and Switzerland. Many countries allow individuals and businesses to set up companies in such tax havens but must disclose all details of such companies and pay the respective taxes on them in their home countries.

of businesses in other countries, often called the "offshore countries."

These offshore countries or territories are those where: The process to set up a company is relatively effortless; Several rules that shield the owner's identity exists; Corporation tax is relatively low or even zero.

The locations are frequently referred to as tax havens or secrecy jurisdictions. Although there is no official list of tax havens, the most well-known are British Overseas Territories like the Cayman Islands and the British Virgin Islands.

PROMINENT INDIAN NAMES IN THE LEAKS:

These papers provide insights into how money and power operate in the 21st century and how wealthy individuals exploit loopholes in the legal system without facing any consequences. The leak has proved the lack of efforts from the governments and global organizations to end such offshore financial abuse.

WHAT DO OFFSHORE HAVENS MEAN? The Pandora Papers expose complex crossborder networks of companies, leading to hidden ownership of money and assets.

Someone may hold property in the United Kingdom, but it is owned through a network

The Pandora Paper leaks include over 300 Indian names, including several prominent Indian names like Sachin Tendulkar, Jackie Shroff, Anil Ambani, etc. They have all established companies "offshore," in places like the British Virgin Islands (BVI), where tax rates are minimal or non-existent, and their businesses and identities are hidden from the public. Here are a few prominent names on the leaks: Anil Ambani: The younger Ambani brother has been

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| COVER STORY accused of setting up 18 offshore companies that have borrowed and invested $1.3 billion, one of which shares a promoter firm that owns the Reliance Capital. In response to the accusations, a lawyer on behalf of Anil Ambani told the Indian Express that "The Reliance Group conducts business globally, and for legitimate business and regulatory requirements, companies are incorporated in different jurisdictions."

Sachin Tendulkar: Cricketing legend Sachin Tendulkar has been accused of setting up a firm way back in 2007, sold in 2016, valued at around $8.6 million. On behalf of Sachin Tendulkar, the CEO and Director of the Sachin Tendulkar Foundation has responded to such accusations by saying that these investments are legal and disclosed in Tendulkar's tax returns.

Jackie Shroff: As per the leaks, along with his children Krishna and Jai Tiger, the Bollywood star and film producer was reportedly the beneficiary of an offshore trust. Ayesha Shroff, the wife of Jackie Shroff, denied all connections to such trusts on behalf of her family.

Nira Radia: Former Corporate Lobbyist Nira Radia is said to have set up Sanjay Newatia, a former Credit Suisse banker, who manages her offshore business through a dozen firms.

Radia denies being connected to a dozen offshore firms, asserting that "correct disclosures have been submitted to all relevant authorities."

Kiran Mazumdar Shaw: The husband of Kiran Mazumdar-Shaw, the founder, and chairperson of Biocon, a British citizen, is said to have set up a company that owns 19.76 percent of Biocon and has $85 million in cash and real estate. In response to such reports, Shaw has stated that Glentec is registered with the RBI and SEBI. GOVERNMENT’S RESPONSE The Indian government has directed that the investigations in cases of Pandora Papers leaks appearing in the media under the name "PANDORA PAPERS" will be monitored through the multi-agency group, headed by the Chairman of Central Board of Direct Taxes having representatives from Enforcement Directorate, Reserve Bank of India and Financial Intelligence Unit.

Paolo Gentiloni, the EU tax commissioner, told the European Parliament that the European Commission would present new legislative proposals to tackle tax avoidance and tax evasion by the end of the year.

While in the UK, the Blairs have denied any wrongdoing. The US Department of States will review the documents published in the Pandora Papers.

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| COVER STORY OTHER SIMILAR LEAKS: The Panama Papers, which were leaked in 2016, were one of the most notable offshore leaks to date. It contained 2.6 TB of material leaked from the Mossack Fonseca law firm.

The Paradise Papers, which included 1.4 TB of data, were leaked the following year.

trying to appear more lucrative to be super-rich, it has started a race to the bottom.

This should be addressed immediately by setting up objective criteria for a country to qualify as a tax haven followed by trade sanctions to be sanctioned against.

2. Ensure Transparency in Corporate Taxes

Source: International Investigative Journalists

Consortium

of

HOW TO PREVENT TAX AVOIDANCE: To prevent corporate tax avoidance, there have been several initiatives that the governments have taken up in the past, but to address this issue, a more collective effort is necessary.

Options available for governments to explore are: 1. Ending Tax Havens Despite repeated leaks, the efforts from governments in identifying tax havens based on objective criteria have been missing. This has become evident in the black lists published by OECD, which had listed just one country as a tax haven. Since the countries are trying to compete with each other in

Corporates have been shifting their profits to countries with low or zero corporate tax rates, which rob the poorer nations of their essential revenue source.

This phenomenon of dodging tax is now at an industrial scale. And although the practice is widely known, very little data on it is available as multi-national companies are not required to make their country-bycountry financial data public and publish only their aggregate. Thus, transparency is the first step towards identifying companies that engage with offshore tax havens and preventing tax dodging.

3. Establishing a register of ownership of assets Assets such as shell companies, bank accounts, foundations, property, etc., should be registered in a central public register that records the real and ultimate owner of these assets and has an automatic information exchange agreement so that countries can collect data on individuals offshoring their wealth.

While information exchange agreements

07

| COVER STORY exist in the EU and between OECD countries, many countries choose not to maintain a public register to operate as a tax haven. So far, only the rich countries have been able to take advantage of the information exchange model.

4. Balanced Tax treaties Agreements between developing and developed nations on the right to taxation of foreign-owned companies are often unfair to developing countries. A balance on the matter should be involved and should align with Agenda 2030's Sustainable Development Goals.

5. New Generation of tax reforms Older tax reforms that were meant to address the banking secrecy and tax abuse have been of little use, as seen from several "paper leaks" in the past decade. There is a need for a global tax reform that brings countries on an equal footing in tackling the issue of corporate tax avoidance. These may include reallocating taxing rights, tackling tax havens and harmful tax practices, and developing alternative approaches to the arm's length principle. Finally, until an international body that can monitor tax avoidance is formed, global institutions such as the World Bank and OECD must develop an agreement between countries to ensure that corporates pay their fair share in taxes.

08

| ECO SECTION

INCREASING INFLUENCE OF DOLLAR ON GLOBAL TRADE CURRENT SITUATION OF DOLLAR The fluctuation of currency exchange rates significantly influences the health of developed and developing economies. The US dollar is the world’s premier currency for international trade and investment. The flow of goods and services around the globe is facilitated by the dollar. A stronger dollar leads to a tighter financial condition, which in turn has a negative impact on the credit availability for exporting enterprises' working capital. A higher value of the dollar reduces trade volumes through the financial channel, canceling out any gains in trade competitiveness. When the dollar is strong, trade activity, as well as global trade,suffer.

Source: VoxEU

Tanisha Chaudhary | MBA - C | 2021-23 Kartik Anand | MBA - D | 2021-23 Figure 1 depicts how global trade activity varies in response to the strength of the dollar. The figure shows the negative correlation between global trade activity and the strength of the dollar. This pattern is remarkable in its consistency and has remained the same even during the pandemic.

EMERGENCE OF THE DOLLAR The US dollar was used as a central paper currency for the first time in the year 1914. It was in the year 1913 that the then established Federal Bank put an end to the

09

| ECO SECTION unreliable, unstable currency system and started controlling the reserves centrally. It was around this time that the US economy surpassed the UK economy to emerge as the world’s largest economy and put an end to the centricity of trade around the Sterling Pound.This encouraged countries from the rest of the world to peg their currencies against the dollar in order to stabilize the exchanges.

The role of the US in both World Wars was vital in the making of the dollar as the world’s reserve currency. The US served as the supplier of weapons and other goods to the other nations involved in the war. The countries made payments for all their demands in gold, which made the US owner of the world’s largest gold reserves by the end of the wars.

as international cash. The studies indicatethat about 55% of the US currency notes are circulated outside the country.

The dollar plays a central role in the exchange rate and foreign exchange reserves of countries all across the globe. It helps them in controlling inflation and making the currency value reliable. The share of the dollar in the Portfolio Foreign Exchange reserves accounted for almost two-thirds of most of the portfolios.

With an 86% share, the dollar leads in the foreign exchange markets and is used as an invoicing currency. Turnover volumes in the foreign exchange markets have more than doubled in the past decade, implying more transactions involving the dollar. Higher transactions contribute to lower bids reinforcing the dollar’s use.

The Bretton Woods agreement attended by 44 delegate nations focused on developing an impartial currency exchange model giving reasonable controlling power to all countries to regulate currency supply. The reserve currency status of the dollar is principally dependent on the strength of the US economy and the dominance of its financial markets.

The emergence of the euro in 1999 brought a worthy challenger to the dollar as an international currency. The debate on the dollar’s supremacy has been on since then.

Source: Hoover DOMINANCE IN TRADE

ROLE OF ECONOMY

THE

DOLLAR

IN

THE

WORLD

The stability of the dollar makes it attractive in volatile economies which leads to its usage

The enormous preponderance of dollar billing in international trade is revealed by numerous studies on trade invoicing. The exchange rate impacts the inflation of most

10

| ECO SECTION of the countries since the countries import goods from the rest of the world. The local prices at which they can import goods depend on the value of the home currency relative to the rest of the world.

According to the Dominant Currency Paradigm, the value depends heavily on the value of dollars even if the trade with the US is a tiny fraction of the country’s overall trade. For instance, when Japan sells goods to India, the trade is made at a price relative to that of a dollar even though the US is on neither side of the trade.

The exchange rate also has an effect on exports to the rest of the world. In a situation where Indian Rupee depreciates in relation to the Japanese Yen, there is a possibility that exports from India to Japan could still go down if the Japanese Yen depreciates relative to the dollar.

According to research based on trade invoicing statistics for a sample of 43 nations that account for 55 percent of global imports and 57 percent of global exports, the share of the dollar as an invoicing currency is 4.7 times its share of global imports and 3.1 times its share of global exports. The dollar's percentage of invoicing outnumbers its share

Source: BNY Mellon

in the country's imports. Even in countrieslike Japan and the United Kingdom, whose currencies are reserve currencies, merely 40% of the exports are invoiced in their own currency in Japan and 51% in the United Kingdom. Figure 2 shows a more detailed analysis by graphing the percentage of imports invoiced in dollars (black bar) against the percentage of imports from the United States for different countries (grey bar).

DOMINANCE IN ASSET MARKET In the case of developing economies, it has long been acknowledged that the markets rely substantially on dollardenominated foreign currency borrowing, a phenomenon known as "original sin."

The dollar is overwhelmingly the currency of choice, as evidenced by the currency breakdown of loans. The euro, on the other hand, is mainly used by emerging European and developed countries.

Indeed, non-US banks' dollar liabilities, which are to the tune of $10 trillion, are nearly similar to those of the US. According to local banking statistics from the Bank for International Settlements (BIS), the foreign currency of local liabilities of a major proportion of the banks is denominated in dollars.

Companies outside of the United States frequently face a balance sheet mismatch problem as a result of the dollarization of global finance. This is because, in many situations, dollar borrowing is done by companies that do not have comparable

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| ECO SECTION dollar sales, resulting in a currency mismatch that might affect the companies negatively in case the value of dollar appreciates.

DOMINANCE IN CENTRAL BANK RESERVES According to the currency composition data by the International Monetary Fund, out of $10 trillion of reserves (2017 Q4), the share of dollars is 63 percent, followed by the euro at 20 percent. The central banks have held 59% of their reserves in USD. The reserves in cash, bonds, and US Securities, and dollar-denominated debts stand at 12.6 trillion. The high reserves reiterate the dollar’s dominance as a reserve currency and reflect the ambition of central banks to be the lender of last resort to national banking systems.

CONCLUSION: The international role of the dollar remains substantial in the world economy despite the fluctuations in the value of the dollar and the Global Financial Crisis (2008). The use of the dollar in other countries continues to benefit the US economy. In general, it prevents the US economy from facing foreign shocks, lowers trade and finance transaction costs, and expands the international transmission of US policies. Broad usage of the currency in reserves and foreign transactions is often associated with greater susceptibility of trade, inflation, and asset values to global changes in the value of the dollar for the non-US economies.

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| SECTOR ANALYSIS

STEEL INDUSTRY Vidyathmika. S | MBA - FS | 2021 - 23 Muskan Jain | MBA- FS | 2021-23 INTRODUCTION TThe Steel industry is one of India's core industries, contributing about 2 percent to the GDP. The Industry has been aiming to improve the capacity to 300 MTPA by 2031 and become self-sufficient in manufacturing steel. This vision of capacity expansion and demand growth will require a considerable capital investment estimated to increase by Rs 10 lakhs crore. Apart from increased capital investment, the Industry will also need a tremendous power supply by 2030-2031.

In 2019, India was the second-largest steel producer globally, with 111.2 million tonnes (MT). The growth of the Indian steel sector was driven by the domestic availability of raw materials such as iron ore and cheap labor. As a result, the steel sector made a significant contribution to manufacturing production in India.

India's Steel Industry employs more than 25 lakh people both directly and indirectly. Employment in this area is expected to increase up to 36 lakhs by 2031, making it an excellent source of employment generation.

India's steel industry is modern with state-of-the-art steel mills. It has always strived to continually modernize older systems and upgrade them to higher levels of energy efficiency.

Source: IBEF

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| SECTOR ANALYSIS SIGNIFICANT COMPANIES MANUFACTURING STEEL IN INDIA

either blast furnace/blast oxygen furnace or an electric arc furnace. Both methods are constantly enhanced to meet the challenge of low-emission steel manufacturing.

Source: Ibef

Source: Constructionhow.com Source: Ibef

PORTER'S FIVE FORCES 1. The threat of new entrants- Medium

Source: Ibef STEEL MANUFACTURING PROCESS Steel is manufactured from iron ore, a mixture of iron, oxygen, and other mineral such as limestone. Steel is made from basic materials mined And processed into steel using one of the two processes,

The threat of new entrants is medium based on the following factors. Steel Industry is a capital-intensive industry wherein a minimum requirement of Rs.25 to 30 billion is required to set up a 1mtpa integrated steel plant in India based on the location and technology used. Many Integrated steel plants have their mines for critical raw materials such as iron ore and coal, posing a threat to new entrants.

Regulatory clearances and other government policies also cause some problems for new entrants into the Industry.

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| SECTOR ANALYSIS Companies like Tata Steel enjoy a premium for their products due to the quality and brand value that they have created over the years.

2. Bargaining power of Customers- Low Steel industries in India sell their products directly to customers or through their distribution channels or export their products. Thus the consumers have external bargaining power. However, customers might have some bargaining power if the government imposes any price ceiling or export restrictions.

3. Bargaining power of suppliers-Mixed ·Since fully integrated steel plants have their mines for crucial raw materials like iron ore and coal, suppliers' bargaining power for such plants is low. However, for semi-integrated steel plants, dependency on suppliers is high, and hence the suppliers have some bargaining power.

Thus, the bargaining power of suppliers is mixed in the case of the Steel Industry.

5. The threat of substitutes- Low Even though usage of Aluminium has been rising continuously in the automobile and consumer durables industries, it still does not pose any significant threat to steel as the cost of electricity for extraction and purification of Aluminium is very high.

COVID IMPACT AND RESPONSE The pandemic has eroded demand due to lower consumption in end-user industries.

In May 2020, the Steel demand fell 54 percent compared to May 2019. The pandemic is also hampering plans to expand capacity due to poor liquidity from Indian producers ahead of COVID, which deteriorated amid falling demand. In addition, the high level of indebtedness is expected to lead to higher interest expenses and a labor shortage that impedes economic production.

4. Industry Competition- Medium Competition in the domestic steel industry is medium as demand exceeds supply.

India is a net importer of steel.

However, there exists a threat of dumping cheaper products into the Country.

Source: Kearney analysis

Indian steel companies are likely to postpone plans to expand the capacity of

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| SECTOR ANALYSIS

almost 10 MT for at least one to two years.

At the beginning of fiscal year 21, Indian steel companies saw a 15-20 percent decrease in utilization compared to previous years; some players were also more dependent on exports.

Over the past three decades, there has been a close correlation between Economic growth and the Steel Industry. India's GDP growth is expected to remain subdued in the future. Therefore, growth in the steel industry is likely to remain undisturbed. As a result, the Country will need a recovery plan to mitigate the effects of the slowdown caused by the pandemic.

organized by the Indian Institute of Metals on "Making East India a manufacturing hub with metallurgical industries." In 2020, the Purvodaya Mission was launched to accelerate the development of the eastern states of India (Odisha, Jharkhand, Chhattisgarh, West Bengal, and the northern part of Andhra Pradesh) by establishing an integrated steel hub in Kolkata, West Bengal. East India has the potential to add more than 75% of the Country's incremental steel capacity. It is expected that of the 300 MT capacity by 2030-31, greater than 200 MT may come only from this region.

Commercialization of Hydrogen in Steel and Cement Sectors-In June 2021, JSW Steel, CSIR-National Chemical Lab (NCL), Scottish Development International (SDI), and India H2 Alliance (IH2A) joined forces for the commercialization process.

Source: Kearney analysis GOVERNMENT INITIATIVES Some of the recent Government initiatives in the steel sector are as follows: In June 2021, the Minister of Steel, Oil and Natural Gas, Mr. Dharmendra Pradhan, delivered the webinar

Allocation of Rs. 39.25 crore (US$5.4 million)-Under the Union Budget 2020-21, the government allocated Rs. 39.25 crore (US$ 5.4 million) to the Ministry of Steel. The budget focused on creating infrastructure and manufacturing to improve the economy.

Furthermore, higher spending in critical sectors such as defense services, railways, highways, transportation, and highways would boost steel consumption.

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| SECTOR ANALYSIS

India- Japan Steel Dialogue-In January 2021, the Ministry of Steel of the Government of India signed a Memorandum of Cooperation (MoC) with the Ministry of Economy, Trade, and Industry of the Japanese government to strengthen the steel sector through joint activities under this Steel Dialogue.

INVESTMENTS Significant investments and developments have been made in the recent past in the steel industry and related mining and metallurgy sectors.

According to the Department for Promotion of Industry and Internal Trade (DPIIT), between April 2000 and March 2021, Indian metallurgical industries attracted FDI inflows of US$ 14.74 billion.

Some of the significant investments in the Indian steel industry are as follows: Joint Venture between ArcelorMittal and Nippon Steel(AM/NS India)-In June 2021, they announced plans to increase its capacity to 30 MT with a massive investment of Rs. 85,000 crore (US$ 11.40 billion).

Over the next three years, starting in June 2021, JSW Steel plans to increase the capacity of the Vijayanagar steel mill by 5 MTPA and build mining infrastructure in Odisha.

In June 2021, Mr. T.V. Narendran, the newly elected president of the IIC and CEO of Tata Steel, told The Telegraph that the steel companies had reiterated their plans to invest Rs. $ 60 billion ($ 8.09 billion) over the next three years - This was the most extensive private sector investment plan recently announced.

In June 2021, Shyam Metalics and Energy Ltd. (SMEL) announced that it plans to double its manufacturing capacity with an estimated investment of ~ Rs. 2,894 crore ($ 389.72 million) from the expansion of brownfield in two of its units over the next 3-4 years.

In March 2021, Arcelor Mittal Steel signed a Rs 50 billion contract with the Odisha government to build a steel plant in the state.

DRIVERS OF GROWTH FOR THE STEEL INDUSTRY The challenging situation caused due to Covid can be overcome by increasing the production of high value-added steel which can increase demand for the steel.

This can be done by planned capacity expansion by providing financial support to companies that were affected due to the Covid-19 pandemic.

Developing R&D capabilities and IT

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| SECTOR ANALYSIS

-enabled infrastructure can help in reducing unnecessary costs.

Relaxations on land use and permits can help revive the Industry, and easy access to water and electricity can help provide a pavement for the sector's growth. Easy access to raw materials will help reduce the dependency on imports to help small and mediumsized producers.

Good infrastructure and logistics can help in increasing sales and thus make the companies profitable.

Source: Ibef The year-on-year growth of the steel manufacturers would be high because of the lower base value during the Pandemic period, but the Quarter-onQuarter profit growth is expected to be weak for most of the companies.

It is also essential to adhere to global regulations to export steel and control emissions to save the environment.

Joint Venture between ArcelorMittal and Nippon Steel(AM/NS India)-In June 2021, they announced plans to increase its capacity to 30 MT with a massive investment of Rs. 85,000 crore (US$ 11.40 billion).

FUTURE OF STEEL INDUSTRY Rising international coal prices, mainly coking coal, have increased from $25-$30 per tonne. This price rise will affect the steel manufacturers as it is used in the manufacturing process. Hence, the margins for the steel companies in the upcoming quarter will be severely impacted. However, the suppliers of coal would be benefited from this price rise.

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| COMPANY ANALYSIS

JINDAL STEEL AND POWER LTD.

BUSINESS OVERVIEW Jindal Steel and Power Ltd (JSPL) is one of India's major steel producers with a stronghold in the Steel, Power Generation, Mining, and Infrastructure sectors. It is a part of the USD 18 billion diversified O. P. Jindal Group. The company produces efficient and economical steel and power through backward integration with its captive coal and iron-ore mines.

Naveen Jindal, son of the late O P Jindal, leads JSPL and its group of companies Jindal Power Ltd, Jindal Petroleum Ltd., Jindal Cement Ltd., and Jindal Steel Bolivia.

JSPL has consistently tapped new opportunities by increasing production capacity, diversifying investments, and leveraging its core capabilities to venture into new businesses. JSPL's investment commitments in steel, power, oil & gas, and mining have touched more than Rs. 1,50,000 crore.

Priyanka Acharekar | MBA - A | 2021-23 Anirudha Kulkarni | MBA - B | 2021-23 The company has eight facilities in India, of which four are in Chhattisgarh, two in Orissa, and one in Jharkhand, while its international facility is located in Bolivia (South America).

VISION AND PRINCIPLES The company's vision is "To be a globally admired organization that enhances the quality of life of all stakeholders through sustainable industrial and business development."

Jindal Steel and Power Ltd. aspires to achieve business excellence through the following priorities.

The spirit of entrepreneurship and innovation Sustainable environment-friendly procedures and practices

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| COMPANY ANALYSIS Optimum utilization of resources

2. Power

The highest ethics and standards

Jindal Power Limited (JPL), a subsidiary of JSPL, is a leading power company in India across the energy spectrum: thermal, hydro, and renewable. Its technical and managerial capabilities have led to JSPL contributing significantly to the growing needs of power in the country.

Hiring, developing, and retaining the best people Maximizing returns to stakeholders Positive impact on the communities they touch

Key Projects

BUSINESS SEGMENTS 1. Steel JSPL is a major steel company in India and is ranked as the second-largest value creator in the world. The company's product portfolio spans across the board from the widest flat to a range of long products and rails exported to 22+ countries.

Key Projects

3. Mining JSPL has a total mining capacity of over 9.11 MTPA of coal and iron ore at various locations in India and abroad. Owning captive mines has ensured an uninterrupted supply of high-quality raw materials and no dependence on thirdparty for raw products.

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| COMPANY ANALYSIS

Key Projects

Independent Director), and one nominee.

SHAREHOLDING PATTERN

4. Constructions JSPL has ventured into Construction Solutions to harness the potential for economical, efficient, and environmentally sustainable construction methods. They present a wide range of structural and specially engineered steel products. They are the first and the only steel producer in India producing and fabricating E 550 grade Steel plates. They have also introduced several innovative construction solutions – like Speedfloor, Cut & Bend, Weld-mesh, etc. – to tackle the need for faster construction.

CORPORATE GOVERNANCE The Company's Board consists of 10 Directors. Besides the Chairman, an executive promoter director, the Board comprises two executive directors, one non-executive promoter director (woman director), five non-executive independent directors (includes one woman

Source: Annual Report and Trendlyne Promoters holding remains unchanged at 60.47% in Jun 2021 qtr. FII/FPI have decreased holdings from 10.99% to 10.54% in Jun 2021 qtr. Mutual Funds have decreased holdings from 13.77% to 12.36% in Jun 2021 qtr. Institutional Investors have reduced holdings from 27.91% to 25.77% in Jun 2021 qtr.

SALARY COMPENSATION The annual growth in the earnings for FY 2020-21 has been 36%. The percentage increase in the median salary in the FY2020-21 for employees is 8.40%, and that of promoters and managerial personnel is 12.2%.

The percentage increase in the median salary in the FY 202-21 for employees is 11.17%, and that for key managerial Personnel is 31.16%.

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| COMPANY ANALYSIS RATIO ANALYSIS

Source: Annual Report Source: Annual Report and Trendlyne

FINANCIAL ANALYSIS

Source: Annual Report Aggregate sales increased 29% to Rs. 33,973.94 crores in FY 2020-21 as compared to the previous year. The company reported a huge increase in net profit from Rs. 261.95 crores in FY2019-20 to Rs. 1964.91 crores in FY2020-21. The earnings per share (EPS) also increased to Rs. 70.14 from Rs 6.09.

From FY 2019-20 to FY 2020-21, the return of capital employed (ROCE) increased from 8.06% to 20.22%, while the earnings before interest and tax (EBIT) margin increased from 13.3% to 34.45%. The current ratio, i.e. the ratio of current assets to current liabilities, also increased from 0.74 to 1.33 for the same period.

FUTURE OUTLOOK As recovery from the pandemic is bound to boost demand, JSPL plans to shell $2.4 billion to increase capacity over the coming six years. JSPL plans to raise total crude steel capacity to 15.9 million tons by March 2025 from 8.6 million tons. They also plan to more than double pellet production capacity to 21 million tons by 2024.

The expansion plans are motivated by expectations of robust consumption as India plans to invest Rs. 100 trillion in infrastructure for an economic boost and job creation. JSPL estimates annual demand will recover from pandemicrelated disruptions and grow 8% to 9% by 2025

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| COMPANY ANALYSIS JSPL also said it would sell its 96.42% stake in subsidiary Jindal Power Ltd to one of its promoters, Worldone Private Ltd. The goal is to reduce the debt, focus on the Indian Steel business and reduce its carbon footprint by almost half. Once the divestment takes place, the deal would be favorable for the company as it would focus the business entirely on steel, which is lucrative.

Another aspect is JSPL's exhaustion of Sarda iron ore inventory which may lead them to purchase the raw material from the open market, which may exert some pressure on the current level of margins.

The company's expectations for good growth in the medium term due to recovery in the Indian economy and infrastructure push as well as the power business divestment show an optimistic path forward for the company.

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| INTRIGUING INDEED

WHAT IS A REIT AND HOW DOES IT WORK? LITIGATION FINANCING INTRODUCTION For ages our elders have emphasized on the importance of land and property, however owing to the inherent disadvantages that come with its bulk of the land to be bought, a large amount of money to be furnished, getting all legal approvals and clearances, Tenant management, etc investors were always sceptical about investing directly in Real Estate sector. However, REITs (Real Estate Investment Trust) solve this hurdle in a very innovative way. But what exactly is REIT? How does it work? Does it come with a huge risk? And which companies in India are offering them? This article will clear all the doubts regarding it.

HISTORY The creation and conceptualization of REIT came around in 1960 when US President Dwight. Eisenhower signed public law 86-779 also known as the Cigar Excise Tax Extension of 1960. After the sanction of this law, the New York Stock Exchange-listed the first

Viram Vora | MBA - C | 2021-23 Varun Nagar | MBA - IB | 2021-23 REIT after which the investors were introduced with the opportunity to invest diversified portfolios of real estate that were capable of producing income as well.

Similar products debuted on European, Japanese, and Australian stock exchanges in the following decades.

WHAT IS REIT? As Mark Twain famously said, “Buy land, they are not making it anymore”. REITs enable investors to invest in small amounts and hold assets individually for a larger real estate holding. REITs are structured similarly to mutual funds and offer investors an exceptionally liquid alternative to invest in real estate. It is a type of asset that offers regular income, portfolio diversification, and long-term capital appreciation to all types of investors, large and small. It offers a wide profile that allows investors to invest in real estate-related funds.

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| INTRIGUING INDEED REITs can be divided into two types: Equity REITs and Mortgage REITs. Equity REITs own assets such as offices, condominiums, hotels, and shopping centers which generate the majority of their earnings from rent on these properties.

Mortgage REITs oversee the financing of buildings, which can be residential or commercial, and receive income from the interest earned on mortgages or mortgagebacked securities (MBS).

The process starts with the initial step where REIT is created by a sponsor that transfers the ownership to the REIT and gets the unit in return.

Now the REIT may develop a commercial property or a residential one as per the project plan and execute it in likewise manner. Once the project is completed and the monetary returns start to pour in, they are distributed amongst the unit holders in the form of dividends and capital appreciation. Currently, 39 countries have established REITs. These countries have a total of 490 real estate companies that have a market capitalization of US $1.7 trillion.

The country's economic growth is dependent on infrastructure development, which contributes significantly to the economy and related growth. The goal behind REIT-backed investments is to ensure that the real-estate financing business is concretely structured so that investments made in the sector are focused

for maximum growth. The REIT's function in India is to make industry-backed finance more structured for this goal.

The Securities and Exchange Board of India (SEBI) initially introduced REITs in India in 2007, nearly 50 years after they were first incorporated as an investment vehicle. In India, SEBI is the regulatory body for governing REITs. Being a relatively new concept, it is in its nascent stage currently.

The government has passed the Real Estate Regulation Bill, which would ensure that funds reach the real estate sector through citizen participation in such funds. It protects the rights of investors in real estate development funds. The government also ensured that the Dividend Distribution Tax DDT is removed, which was associated with REIT funds.

In order to qualify as a REIT, a company must satisfy the following criteria The REIT must be listed on the stock market.

90% of the income generated must be distributed to the investors in the form of dividends.

At least 80% of the investment must be put in revenue-generating properties.

The rest 20% can be held by the REIT in the form of bonds, cash, underconstruction property, or stocks.

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| INTRIGUING INDEED

Only 10% of the total investment must be placed in under-construction real estate developments.

Mindspace Business Parks REIT

The company must have an asset base of at least Rs 500 crores.

Embassy Office Parks REIT

Net Asset Value (NAVs) must be updated twice in every financial year BENEFITS of REIT REITs do not require as much capital as a direct property investment.

Furthermore, there aren't many successful investing options available right now.

REITs make it easier to invest in real estate.

REITs have lesser liquidity risk when compared to direct real estate investing.

Because REITs are controlled by SEBI, the possibility of fraud is quite low.

These are transparent because the capital portfolio is disclosed annually and semi-annually.

These have a larger yield since about 90% of income is delivered as a dividend to REIT owners.

In India, there are currently 3 REIT stocks that are listed.

Brookfield India Real Estate Trust

STRUCTURE OF REITs Indian REITs follow a three-tier structure to perform and manage the real estate work effectively. These tiers have also been mandated by SEBI (Securities Exchange Board of India). The functions include: Sponsor: This is the first tier that is responsible for creating the REIT and setting it up in the first place. This happens to be a construction company or a real estate developer that owns the land and necessary materials for further processing of the project. It is mandated for the sponsor to hold 25% of the overall units for the period of the first three years after the creation of the REIT. The sponsor can decrease the holding value to 15% after the completion of the three-year period.

For Instance, Sponsors for Mindspace Business Parks REIT are Anbee Constructions LLP and Cape Trading LLP. Manager: As the name suggests the manager entity is responsible for managing the assets, making investment decisions, and ensuring that all other legal and formal obligations are within the decided governmental

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| INTRIGUING INDEED

these include office spaces that generate revenue by rental income received from tenants with long-term leases.

Healthcare REITs: These REITs include nursing facilities, Hospitals, retirement homes, and medical centres. The source of revenue for them is the services they offer.

Source: Crunchbase

framework. For instance: Mindspace Business Parks REIT has K Raheja Corp Investment Managers LLP as the appointed Manager.

Trustee: The primary function of the trustee is to hold the assets of the REIT in a Trusteeship. Additionally, the trustee overlooks the activities of the Manager and ensures that the dividends are dispensed on a timely basis. For instance, the Trustee for Mindspace Business Parks LLP is Axis Trustee Services Ltd.

Mortgage REITs: In these REITs, 10% of the investments are made into mortgages instead of physical Real Estate.

Retail REITs: These REITs invest in commercial retail properties like shopping malls and freestanding retail stores. They are required to invest at least 24% of their assets in the commercial retail sector.

TYPES OF REIT Additionally, there are different types of REITs that can be categorized based on the type of holding that the REITs hold.

Office REITs: As the name suggests,

Source: Statista

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| INTRIGUING INDEED

We can observe from the above-mentioned bar chart that in the year 2020, American Tower was the largest REIT in the US with a market capitalization of 102.3 billion US dollars. It was followed by Crown Castle International with a market capitalisation of 58.9 billion US dollars and later followed by Prologis with 56.6 billion US dollar market capitalisation. All of the world's ten largest REITs are based in the US. Let us have an insight into how do REITs generate revenue since the ultimate aim of any investor would be to generate wealth or provide regular income. This can be done by the following methods:

SEBI has mandated REITs to pay out at least 90% of the Net Rental Income in the form of dividends or interest.

WAY FORWARD One can invest in REITs to diversify their portfolio by increasing their exposure to real estate. REITs also eliminate the hassles that come with the purchase and maintenance of immovable land and property. Moreover, REITs are a way to professionally manage the assets with relatively small ticket sizes of the investments in terms of the money involved, however, the disadvantages must be kept in mind as well.

Capital Gains: As REITs are listed on stock exchanges, they can be traded as well, so when the price of the individual unit changes depending upon their performance and also based on the demand in the market, the same unit can be sold at the provided price to get capital gains.

Dividends: As we know, REITs can also be used to rent our commercial and residential properties, this same earning can be paid out to the investors in the form of interest or dividends from their Net Rental Income. The net rental income is the amount that remains after deducting expenses related to managing the properties and management costs from the Gross Rental Income. This includes maintenance charges, management fees, depreciation, etc.

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| ENTREPRENEURSHIP INNOVATION

DUNZO ABOUT THE COMPANY Dunzo is a hyperlocal delivery service startup backed by Google and is currently operating in eight Indian cities; Bangalore, Pune, Gurugram, New Delhi, Mumbai, Jaipur, Hyderabad & Chennai. Founded in 2014 by Kabeer Biswas in Bengaluru, the venture started as a WhatsApp group for pick and drop services, deliveries, and laundry picking. Now, it's a complete app-based service that connects users to their nearest delivery partners, fulfilling around two million orders per month for customers across the eight cities. The company offers services that include delivering packages, food, groceries, medicines, pet supplies, etc.

It also strives to advance the retail landscape by providing micro, small and medium-sized enterprises (MSMEs) with digital tools and solutions to streamline and facilitate e-commerce sales. This initiative has helped Dunzo increase the number of local merchant partners from 600 (March 2019) to 11,000 (February 2021).

Anupreet Lall | MBA C | 2021-2023 BUSINESS MODEL Dunzo follows a hyperlocal delivery business model operating through a website and mobile apps. The platform

Source: Twitter

offers an on-demand concierge service in the hyper-local market. The company operates through a data-driven solution to connect delivery providers with the nearest users for efficient deliveries.

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| ENTREPRENEURSHIP INNOVATION Additionally, the customers can place orders with the local merchants listed on the platform directly via the app.

'Check out with Dunzo' launched in 2019, offers B2B logistics services to retailers and small businesses. It allows merchants to integrate Dunzo's logistic service directly into their websites. The service, just like the payment option, enables the customers to choose Dunzo as their delivery partner at the time of checkout. This feature has made it easier for merchants to initiate orders placed on their websites efficiently and cost-effectively. It is also a considerable step towards enabling faster deliveries for the users.

The startup generates revenue from delivery fees and the percentage of commission charged from the merchants or local vendors for the orders placed through the app. To provide logistic support to small businesses, the company charges Rs 15 for the first 3 km and Rs 15 for every subsequent kilometer. For users, the delivery charges range from Rs 10 to Rs 60 depending on the shop's distance and overall demand in the particular area.

IMPACT OF COVID-19 The covid-19 pandemic came as a blessing in disguise for the company. The startup doubled its active user base from 2.7 million to 5.1 million in 2020. With over 2x growth in gross merchandise value (GMV) compared to the previous year, Dunzo has reached around $100 million in annualized GMV business. This growth came from robust and organic user demand while maintaining gross margin profitability for the overall business, reducing the EBITDA loss by 68% year on year.

The company's Revenue from operation increased by 66.5% to Rs 45.8 crores, majorly because of an increase in commission collected from merchants (56%) and riders (68%) for using the company's platform.

Under the expenses, Employee benefit cost accounted for the most significant part, i.e., 37.4% and these expenses increased by 24.7% in FY21 to 91.6 crores.

According to the startup owners, Covid-19 has been the largest tailwind event for the overall business. The business that they thought would take 24 months to execute got done in just six months.

The lockdowns imposed by the government restricted the regular public movements, as a result of which people shifted towards online delivery apps for ordering daily and weekly essentials. The volume of the transaction on the platform went up by three times. The merchants also realized the

Source: Entrackr

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| ENTREPRENEURSHIP INNOVATION

extent of demand they would get through apps such as dunzo. As a result, Dunzo saw an increase in vendor registrations during this period.

Last year during the pandemic, Dunzo has supported over three hundred neighborhoods across eight cities by delivering essential goods to the customers within 29 minutes on average.

FUTURE PLANS Dunzo has raised around $130 million from marquee investors like Google, Evolvence India Fund, Lightrock, Lightbox, Alteria Capital, etc. Further, the company is in talks with its investors to raise another round of $50 million to bolster its expansion plan.

The owners wish to expand Dunzo daily by increasing the stock-keeping units by 2000 and scaling it in the top 20 cities in the next 18 months. They are also planning to roll out its services in about 25 cities in India in the next 18-24 months. The company plans to launch three hundred micro-fulfillment centers across seven hundred neighborhoods to ensure express grocery delivery. Dunzo is also planning to go global and establish itself in highly populated cities like Singapore, Dhaka, and New York to enable 15-minute delivery.

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| PERSON IN FOCUS

SIR RICHARD BRANSON PERSONAL LIFE Sir Richard Charles Nicholas Branson was born on 18th July 1950 in Black Heath, London. His father was Edward James Branson, a barrister, and his mother was Eve Branson, a former ballet dancer and an air hostess. He also had two younger sisters, Lindy Branson and Vanessa Branson.

Branson completes his early schooling at Scaitcliffe School in Surrey and Stowe school in Buckinghamshire. He had a clinical condition of dyslexia, due to which he had poor academic performance and dropped out of school at age 16.

PROFESSIONAL LIFE AND ACHIEVEMENTS Despite being a school dropout, Branson's parents were supportive of his endeavors from an early age. Branson's journey as an entrepreneur by initially trying his hands on

Upendra Baliga | MBA - C | 2021-23

selling Christmas trees and budgerigars and eventually starting a youth culture magazine called "student" in 1966. For Branson, this was not as successful as he expected it to be. But this venture paved the way for his next startup on mail-order record business, which worked in tandem with the student magazine since the magazine would popularize albums, which increased his record sales.

In 1972, with the wealth generated from previous ventures, Branson launched a record label, "Virgin records," and the reason for choosing this name was that Branson and his team were new to this business. The business model was to purchase a country estate in which he installed a recording studio, and then he would lease it to upcoming contemporary artists. This venture was a grand success, with many notable music bands working

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| PERSON IN FOCUS with Virgin records, like Rolling Stones, XTC, Japan, to name a few. By 1979, Branson's net worth has reached £5million.

In 1984, Branson decided to enter the airline industry. Branson started Virgin Atlantic at just $2million, followed by Virgin cargo and Virgin Holidays, which offered holiday logistics worldwide in 1985. In 1997, Branson entered into what was then considered the riskiest venture of his life – Virgin Express – A Railways business when British Rail was undergoing privatization.

Later in 1999, Branson launched Virgin Mobiles and, in 2000, Virgin Blue – Airlines for Australia.

In September 2004, Branson signed a deal with Paul Allen, Microsoft co-founder, and started Virgin Galactic. The vision behind this venture was to make space tourism available to the public for $200000 per person. This vision which began in 2004, came to fruition on 11th July 2021, when Branson and his team took a flight in Virgin Galactic's VSS Unity and reached the edge of space (86km). From 2007, a new chapter began in Branson's life, wherein he took initiatives for curbing global warming and environmental conservation. He started Virgin fuels, which offered revolutionary cheaper fuels and automobiles.

other branches of medicine – Homeopathy, etc. In 2010, Branson entered the Hospitality industry by starting Virgin Hotels under the Virgin groups of industries. From 2010 till 2019, Branson has invested in multiple industries, some of which include 3D Robotics (a drone company), Hyperloop (Transpiration industry), Metric Capital (Private equity firm).

Branson has been the recipient of multiple accolades, including – the American Academy of Achievements, the Tony Jannus Award, Time's 100 most influential people in the world, the German Media Prize, ISTA prize, Business for Peace Award.

As of this day, Virgin Groups have 400 business ventures, and Sir Richard Branson, whose net worth stands at $5.7 billion, is known for creating 8-billiondollar companies in 8 different industries.

In 2008, Branson entered the healthcare industry by starting Virgin Healthcare. The idea was to offer a chain of clinics that would offer conventional medical care and Source: Google

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| PERSON IN FOCUS PERSONALITY Irrespective of which field he was venturing in, Branson's business model was similar: Enter the business with small capital, create a high-quality product or service, couple this with creative marketing and make it a successful business.

Branson is well known for his sporting achievements and attempted many recordbreaking endeavors, including the fastest ever Atlantic Ocean crossing, a series of hot air balloon adventures, and kite surfing across the English Channel.

Of all his personality traits, the most striking feature is his relationship with failures. Branson never seemed to be afraid of failures, in his own words – "I suppose the secret to bouncing back is not only to be unafraid of failures but to use them as motivational and learning tools...

There's nothing wrong with making mistakes as long as you don't make the same ones over and over again."

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| CALL FOR ARTICLES - WINNER

TATA FINDS BACK ITS LOST CHILD: AIR INDIA Krittika Tewari | KJSIM | MBA 2021-23 INDTRODUCTION This story started in the year 1932, in the city of Karachi when it was a part of unified India.

On 15 October 1932, a 28-year-old Jehangir Ratanji Dadabhoy Tata moved on board a solitary motor plane and took to the skies.

His destination was Madras, and he expected to arrive after a short stop at Bombay. With him, he likewise conveyed a little pocket of airmail that read, 'First Flight Madras-Karachi Airmail Service' In this manner, Tata Air Mail had shown up. Much like that, the carriers went from conveying mail to conveying travelers. Within six years, the organization possessed fifteen planes and was renamed 'Tata Airlines'. By 1946, it possessed half of the nation's armada. That very year, it turned into a public organization and embraced a name all of us know about – Air India. Soon after freedom, the Indian Government prepared a joint endeavour with the Tata Group. They shaped Air India International.

Nonetheless, by 1953, the flying area had become untidy as different aircraft were

attempting to get a touch of the juvenile business. Regardless, just Air India figured out how to stay worthwhile.

In a nationalization spree later, the public authority assumed control over the organization for an incredible Rs. 2.8 crores.

It consolidated different substances, flying India's homegrown courses, including Air India's homegrown operations, and rebranded it as Indian Airlines. Unlike how it is perceived, Air India made a lot of cash for the public authority till the mid-1980s. This was a time of remarkable benefit for Air India, just as Indian Airlines.

The fundamental issue was that ticket costs were unbearably high, and a larger part of the Indian populace couldn't bear to fly.

While trying to expand carrier entrance in India, the public authority permitted the investment of private aircraft in the business flight portion. When private

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| CALL FOR ARTICLES - WINNER players entered the game, more Indians took to air than ever before. This influx ofcompetition increased the prospects of Air India to lose its market share.

By 2007, the Government had merged both entities. Between 2007 to 2009, the total losses increased from Rs. 770 crores to Rs. 7,200 crores and borrowing had increased from Rs. 6,550 crores to Rs. 15,241 crores respectively. The blended element of Air India and Indian Airlines had more than 30,000 workers aggregate. It wound up burning through one-fifth of its income on paying its employees and other advantages. The Government finally had enough of the beleaguered airline, and it began to wash its hands off Air India in 2017. The Tata Group will assume control over state-possessed Air India, denoting a fruitful beginning to the Modi government's privatization program, and stopping the long-term chase after a purchaser for the carrier.

The main critical resource deal beginning around 2004 will likewise see the public transporter return to the Tata crease, following 68 years. Air India and Air India Express will join Vistara and AirAsia India in the Tata stable, permitting the population to discover collaborations among the different constituents. Vistara is a joint endeavor with Singapore Airlines (SIA). A previous effort in 2018 didn't find any takers. The public authority had gotten seven offers this time around for the aircraft, but only two could qualify - one from the Tata Group and the

other from a consortium drove by SpiceJet director Ajay Singh.

Air India is vigorously staffed, weighed down with obligation, and has a maturing armada yet has solid brand review and significant abroad flying freedoms.

While staff confidence and administration levels aren't commendable, Air India is the country's public transporter and is an individual from Star Alliance. Vistara is relied upon to coordinate its organization with that of Air India. Specialists said the mix could win back Indian travelers from the vast Middle Eastern transporters, with explorers currently liking to travel direct.

Air India will be a strategic market offering under the Tatas, similar to what we've seen at the Lufthansa Group. Lufthansa owns subsidiaries such as Austrian, Swiss Air, Sun Express, and joint ventures with China Airlines, among others. This is likely to be the most powerful rebirth of an airline that set the standard for our region back in the 1950s and 1960s.

As Air India is primarily a global airline, its foreign exchange revenues would rise, benefiting India. The Guild is glad to learn that the Tata group has been declared the bid winner, it added, extending its congratulations to Tata on the successful completion of the bidding process. The Indian Pilots' Guild was formed in Mumbai with the blessings of the legendary J R D

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| CALL FOR ARTICLES - WINNER Tata, the Father of Indian Aviation and was registered on March 13, 1948 as a Trade Union under the Indian Trade Union Act of 1926, the Guild said in the letter, adding, the founders of the IPG were a group of ex-Royal Indian Air Force fighter pilots.

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| CALL FOR ARTICLES - RUNNERUP

COAL CRISIS: DARK DAYS AHEAD FOR INDIA? Chetansi Nanavati | KJSIM | 2021-23

INTRODUCTION India is in the midst of a coal crisis as it faces a critical shortage of coal in major plants.

Most power stations had coal reserves of less than a week. In fact, this is considerably less than the government's recommendation of at least two weeks' supply.

There is a greater shortage of coal in nonpithead plants or those plants far from coal mines. In total, 98 of the 108 plants reaching the critical level of stocks, i.e. within 8 days, are such plants.

Government officials, on the other hand, view the rising demand for energy as a positive signal because it indicates that more households are able to afford electricity and that industries are getting back to where they were before the crisis.

Source: Central Electricity Authority Let us have a detailed look at the issue.

INDIA’S COAL RESERVES In terms of producing and consuming coal, India is the second-largest country in the world, after China. A 5.37 percent increase has been recorded in the total estimated

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| CALL FOR ARTICLES - RUNNER UP coal reserves during the year 2020 over the previous year. In India, Jharkhand, Odisha, and Chhattisgarh have the highest coal reserves, which make up about 70% of total coal reserves. Generally, coal is used for electricity production. Among India's 388 GW of installed generation capacity, 54% come from thermal coal power plants, while the rest comes from renewable energy (101 GW), gas (25GW), hydropower (46GW), and nuclear energy.

In addition to a consistent move to lower imports, high coal prices internationally have also encouraged plants to reduce their imports.

REASONS OF COAL SHORTAGES 1. Eruption in Power Demand A combination of the economy's recovery from the Covid-19 pandemic along with supply difficulties has resulted in the current coal shortage.

2. Increased Share of Thermal Power Plants Also contributing significantly to this increase in demand is the coal-fired thermal power plants, which saw India's share of thermal energy in its power mix increase from 61.9% to 66.4% in 2019.

Source: TOI GLOBAL SCENARIO It is not just India that is suffering from the supply crunch, but China and Europe as well. ·China: The world's largest coal consumer is facing a severe coal and electricity shortage. The majority of the areas experienced blackouts and power cuts.

3. Flooding and Rainfall During April-June it rained continuously in coal-bearing areas in August and September, resulting in reduced production and dispatched coal.

4. Lowering Imports

Europe: The cost of energy has skyrocketed in the European Union.

With price caps, rebates, and tax cuts, European governments are trying to shield residential and small business customers from the full force of rising energy prices on utility bills.

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| CALL FOR ARTICLES - RUNNER UP IMPACT OF COAL SHORTAGE Coal shortages are a very serious problem because they affect the supply of energy, the foundation for all economic activity.

1. Delay in economic recovery India's economic recovery could be delayed by the shortage of electricity faced by the industry, which might force businesses to reduce production.

2. Inflationary impact The cost of coal will rise if the shortage of coal persists and companies import more expensive coal. A higher inflation rate would result on top of already high retail prices.

3. Impact on steel The unprecedented rise in coal prices is likely to have a negative impact on steel prices, which could also go up. Coal is used as fuel to power steel plants and to produce steel through the direct reduction of iron (DRI) process.

1. Ramping up production: The government said it is working with state-run enterprises to increase production and mining so that the supply-demand gap can be narrowed. Moreover, as the monsoon ends and winter approaches, the demand for electricity usually drops. As a result, the mismatch between demand and supply may decrease to some extent.

2. Sourcing coal from captive mines: The Centre amended the rules to permit 50% sales from private and public captive mines.

Additionally, increased coal availability will ease pressure on power plants and also aid in the substitution of imported coal.

3. Penalty mechanism: The power ministry is developing a penalty for power generation companies (gencos) and states that fail to pay coal companies on time.

4. The government may also choose to divert supplies from industrial users - like aluminum and cement producers - to power plants.

The price for power sold on the Indian Energy Exchange in September rose by more than 63% year-over-year.

5. Funds for CIL: CIL, which had a reserve of around $35 billion in 2015, appears to be short on funds, especially cash flows as power companies (GENCOs) owe it over $20 billion. Funds will be needed to expand and open new mines.

THE ROAD AHEAD

Long term:

Short term:

1. Collaborating with states to boost coal

4. Rise in spot prices of power

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| CALL FOR ARTICLES - RUNNER UP production: CIL should concentrate on mining. In order to resolve issues related to land acquisition and forest clearance, Union officials should go down to the States, convey a value proposition, and sit down with state officials.

2. Non-CIL production needs to be increased.

3. A Coal Project Monitoring Group (CPMG) which was established in 2015 to expedite clearances has since become dormant. It must be revived.

4. The brewing financial crisis in the power sector must be addressed. Over 2,00,000 crore is yet to be collected from distribution companies by GENCOs. CIL owes them more than 20,000 crores. As a result, there is a serious cash crunch, even though most of these companies report profits.

5. Finally, the current crisis presents an opportunity for India to move strongly towards this cleaner alternative.

A wake-up call has arrived for India, as the time has come for it to reduce its overdependence on coal and more aggressively pursue renewable energy.

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| ALUMNI INSIGHTS

LIFE JOURNEY AT K J SOMAIYA Jagdish Bang | PGDM Financial Services | FINSTREET | Batch 2016 - 2018 Hello Everyone, Hope you and your dear ones are safe and sound.

The last few months have been really difficult for everyone, both mentally and physically. This was indeed a very tough time. I hope that the worst is behind us and we will adapt to this new normal by being cautious.

ABOUT ME

I worked with STCI in various capacities including Risk Analyst, Fixed Income Trader and Funding Desk Dealer. Hereafter I joined TCS Investment Team as an Investment Analyst where my role included managing TCS reserves, TCS employee’s provident fund and TCS employee’s gratuity fund.

Currently, I am working as Manager in Asset Liability Management with Ujjivan Small Finance Bank. ALM team works as a core of the Bank whose role can be summarized as below.

I have completed my B.E. in electronics and communication from Nagpur. Yes, you heard it right I am also an engineer like most of you. After completing my B.E., I embarked on my professional journey with Nvidia. After 3 years at Nvidia, I decided to join KJSIMSR for a two years full time PGDM program in Financial Services. Along with PGDM I have also passed CFA level-III. Post completing my PGDM (KJ SIMSR 2016-18), I joined STCI Primary Dealer through campus placement.

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| ALUMNI INSIGHTS

My day-to-day work includes but not limited to: Managing day-to-day liquidity of the Bank Finding right investment opportunities for excess liquidity investments Managing Bank’s HTM Investments portfolios

and

AFS

Monitoring various regulatory limits as prescribed and governed by regulator Dealing in Money Market instruments like CP, CD, MF, FD etc.

MIS and budgetary reporting to the Board and Senior Management MY JOURNEY AT SIMSR To begin with, all of us would cherish the memory of SIMSR's lush green vast campus, truly one of its kind and rare to be seen in Mumbai. Living in such an amazing campus will make a print on your memories forever.

Undoubtedly two years at SIMSR were the turning point of my life both at a personal and professional levels. My decision to choose Financial services specialization stemmed from my prolonged interest in the financial services domain. I enjoyed and cherished each and every part of this journey which to name a few would be - grueling assignments and presentations throughout the week, burning the midnight oil preparing

for exams, relishing scrumptious maggie at dead of night, the list is just endless but memories for a lifetime. During SIMSR days I was part of the Finstreet and Gita club. I truly enjoyed and actively participated in various events. These events really helped me in overall personality development and improving my subject knowledge.

ONE HABIT FOR LIFETIME I have had the habit of reading newspapers daily even since my engineering days. In today’s globalized world, being ignorant about world events thinking it will not impact us, is a thing of the past. Reading newspapers every day is a must for each and every student irrespective of the domain. It will help you to get the pulse of the real world. It also helps in building knowledge and in various group discussions.

“APNA TIME AAYEGA” Let’s talk about the placements-The most important part of MBA life. This is the time when you have to keep your calm and stay composed. You will need to keep emotional stability more than anything.

There will be a lot of noise around you high package/low package, this profile/that profile, this company/ that company blah….blah… blah. Things may not work out the way you have dreamt off.

Just focus on your area of interest whatever it is. Placements are like stock market wherein the short run there may

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| ALUMNI INSIGHTS

be many short term winners or losers but in the long run, only quality and hard workers will win.

ONE LESSON LEARNT Nothing is more important than family- This is very recent one. Whatever time you get enjoy with your family.

MY LEARNINGS

knowledge and there will never be.

Work on communication skillsKnowledge is not worthless unless you can express it in layman language.

With this all the best to all of you for your future endeavors and always remember: “Journey is more important than destiny.”

LinkedIn.

Welcome to the first step in real world. No matter how much we hate going to work every day, this will be the reality soon. It is up to you whether you will love to go to work or hate it. You can use this journey to explore yourself in order to reach the maximum potential. So use this opportunity to expand your wings and change the course of your destiny the way you want. You will enjoy your work every day. Every day will be a new opportunity waiting for you. It is the best time to pause for a while, think about it, make a strategy and give proper direction to your future journey.

SIMSR will definitely help you to give a head start but the journey is going to be long so prepare yourself so that you can enjoy and make it off to the fullest.

Two golden rules from my side: Read as much as you can along with syllabus books-There is no substitute to

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ISSUE NO. 105, NOVEMBER 2021

About Finstreet Finstreet, the finance committee of K J Somaiya Institute of Management aims at bridging the gap between industry and academic curriculum through effective delivery of knowledge-oriented sessions and events through a network of highly motivated members and renowned industry experts. Through the FINLY magazine, we focus on covering crucial topics for each month and giving our members a platform to express their views.

OUR UPCOMING EVENT

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