WEDNESDAY, 3 JUNE 2020

14 pages in 1 section www.business-standard.com

MUMBAI (CITY)
~9.00
VOLUME XXIV NUMBER 199

THE MARKETS ON TUESDAY Chg#

Sensex 33,825.5 522.0
Nifty 9,979.1 152.9 ECONOMY & PUBLIC AFFAIRS P6 BRAND WORLD P13
Nifty futures* 9,963.0 16.1
Dollar
Euro
Brent crude ($/bbl)##
~75.4
~84.1
38.0##
~75.6**
~84.1**
37.3**
VILLAGES IN BIHAR & UP GET FREE READING THE PULSE OF
Gold (10 gm)### ~46,887.0
*(June) Discount on Nifty Spot; **Previous close;
# Over previous close; ## At 9 pm IST;
~32.0
VOUCHERS TO BUY GREEN POWER THE COUCH CONSUMER
### Market rate exclusive of VAT; Source: IBJA PUBLISHED SIMULTANEOUSLY FROM AHMEDABAD, BENGALURU, BHUBANESWAR, CHANDIGARH, CHENNAI, HYDERABAD, KOCHI, KOLKATA, LUCKNOW, MUMBAI (ALSO PRINTED IN BHOPAL), NEW DELHI AND PUNE

Tiger Global
INDIA RECORDS
VIRUS
TRACKER 8,000+ CASES
FOR 3RD DAY Growth will return, more
loses round 1
reforms in the works: PM
INDIA

Total 198,706
Active cases
97,581
Recovered
95,526
WORLD Total
6,318,040
Deaths
376,885
MODI,TRUMP SPEAK
ON COVID-19, G7
Prime Minister Narendra Modi spoke with
United States President Donald Trump on
Tuesday and discussed the Covid-19
pandemic, among other issues. “Had a warm
and productive conversation with my friend
President @realDonaldTrump. We discussed
his plans for the US Presidency of G-7, the
Covid-19 pandemic, and many other issues,”
Modi tweeted. The richness and depth of
India-US consultations would remain an
important pillar of the post-Covid global
architecture, the prime minister said.
ED files charge sheet
against Chidambaram
The Enforcement Directorate (ED) has filed a
charge sheet against senior Congress leader
and former Union minister P Chidambaram in
the INX Media money-laundering case. A
password protected e-charge sheet was filed
against Chidambaram, his son Karti, and
others before the court of Special Judge Ajay
Kumar Kuhar in New Delhi on Monday. The
charge sheet also names Karti’s chartered
accountant S S Bhaskararaman and others. PTI
Deaths
5,598 Modi says country has left behind lockdown phase and entered unlocking phase
Note: Total cases
include 1 migration;
figures as of 11 pm
IST; Sources:
Ministry of Health
and Family Welfare,
INDIVJAL DHASMANA
New Delhi, 2 June
P
Johns Hopkins rime Minister Narendra
Coronavirus
Resource Centre
Modi on Tuesday
asserted that India
would return to high
growth and promised that his
government would undertake
further reforms with the help of
inputs provided by industry.
India’s economic growth crashed
to a 69-quarter low of 3.1 per cent
in January-March 2019-20.
Modi urged industry to
come up with studies on each
sector of the economy. “We will
together take up large structur-
al reforms that will change the
course of our country,” he said at
the 125th annual general meet-
ing of the Confederation of
14 >
Indian Industry (CII).
He said the pandemic might
have applied the brakes on the
speed of the economic growth,
but the country had left behind
the phase of lockdown and
entered the first phase of unlock-
ing. Large parts of the economy
have been opened in the unlock
phase 1, the prime minister said,
adding further areas would be
opened on June 8.
Markets shrug off IndiGo posts
in Flipkart
“This means the process of
getting back growth has been ini-
tiated,” Modi said.
India Inc
warns of
deal tax case
AAR turns down nil withholding
The home ministry on
Saturday said “Unlock-1” would
be initiated in the country on unrest if tax plea; I-T sought ~886 crore
June 8. Under it, the nationwide
lockdown, since March 25, will
revival is
be relaxed to a great extent. This
will include opening shopping
delayed
malls, restaurants, and religious
places. However, strict restric-
Industry has cautioned
the government that
tions will remain in place till economic recovery needs
June 30 in containment zones. to return quickly or else
The prime minister’s com- social issues will arise
ments came even as various ana- following the severe
lysts have predicted a contrac- impact of Covid-19 on the
tion of up to 7 per cent in GDP in livelihood of the poor.
the current fiscal year. The econ- Sanjiv Puri, chairman and
omy grew by an 11-year low of 4.2 managing director, ITC,
per cent during 2019-20, remind- said the crisis had been
ing people of the global financial “IF YOU (INDIAINC) TAKE “WE HAVE EMPHASISED unprecedented. He said
crisis of 2008-09, which, howev-
er, produced a lower growth rate
TWO STEPS, THE REDUCING THE the ILO had said that four SHRIMI CHOUDHARY TAX TANGLE
of 3.1 per cent.
GOVERNMENT WILLBE GOVERNMENT CONTROL of the world’s five New Delhi, 2 June
| 44 shareholders,
workers would stand in
The prime minister tackled FOUR STEPS AHEAD IN AND CREATING AN immediate danger of The Authority for Advance Rulings
including
SoftBank, Tiger
this issue too. “Some of you may SUPPORTING YOU. I ECOSYSTEM FOR having their livelihood (AAR) has rejected an application of
Global, eBay, and
question me as to why am I so destroyed.Ajay Piramal, three Mauritius-based companies,
confident at this hour of crisis. I
ASSURE YOU I WILL ENCOURAGING PRIVATE chairman of Piramal part of US-based hedge fund Tiger Naspers,sold their
have many reasons to be confi- STAND WITH YOU” ENTERPRISES” Global Management, to avail of nil holdings to
Group expressed the fear Walmart
dent. I have confidence in capa- that if growth was not withholding tax on capital gains aris-
bilities of India and her crisis
NARENDRA MODI, Prime Minister ing out of the $16-billion Walmart- | Until 2018, Tiger
brought back urgently,
management, he said. social issues might Flipkart deal, struck in May 2018. Global controlled
Turn to Page 13 >
PAGE 9 EDIT: IN SEARCH OF GOOD GOVERNANCE come up. 6> Tiger Global was one of the promi- over 20% of Flipkart
nent shareholders in e-commerce | As part of Walmart
major Flipkart, founded by Sachin deal, TigerGlobal's
Bansal and Binny Bansal in 2007. Mauritius firms
Mauritius-based Tiger Global
International (II, III, IV) Holdings
had sold their stake in Flipkart
Singapore in 2018 to Luxembourg-
offloaded majority
of stake in Flipkart
| Hedge funds

Moody’s downgrade ~1,290 crore

COMPANIES P2 based Fit Holdings for over ~14,500 sought certificate
of nil withholding
Indian drug firms await crore. They sought an AAR ruling
after the tax authorities rejected tax, or retention
nod to market remdesivir
Indian players are yet to receive approval to
market remdesivir, even as the United States-
Benchmark indices gain for 5th day to BULLISH pre-tax loss their demand for nil withholding tax
under Section 197. The stake sale
was undertaken as part of the multi-
tax, from tax dept
| Tax dept objected
to the application,
based Gilead Sciences has been granted
authorisation for restricted emergency use of
end at 11-week high; ~ jumps 19 paise SENTIMENT ARINDAM MAJUMDER
billion-dollar transaction to
offload stake in Flipkart to US retail
questioning
ownership
the drug to treat Covid-19 patients. It is also SAMIE MODAK After market closing on Nifty50 New Delhi, 2 June giant Walmart. structure
learnt that the firms haven’t yet approached Mumbai, 2 June Monday, Moody’s lowered The AAR refused the plea on the
the National Pharmaceutical Pricing Authority India’s credit rating from Baa2 The country’s largest airline, IndiGo, will not pay any ground that prima facie the share | Issues emerged
formally to discuss the pricing of the drug. India’s credit rating down- to Baa3 — a notch above dividend to its shareholders for the financial year sale transactions by the applicants afterWalmart
grade by Moody’s Investors junk— with negative outlook, ended 2020, the company has announced. This, along were designed for avoidance of tax deducted taxes
Service failed to make a dent in citing a sustained period of with other cost-saving steps, would help the compa- and to avail of the benefits of the from Flipkart's
THE SMART INVESTOR P10 investor sentiment on slow growth, deteriorating fis- ny generate liquidity India-Mauritius double taxation foreign
shareholders to pay
Despite risks, AT-1 bonds Tuesday as the benchmark cal position, and stress in the
indices gained for a fifth financial sector.
of around ~4,000 crore
to withstand the
avoidance agreement (DTAA).
Turn to Page 13 > withholding tax
back on investors’ radar straight day, with the Sensex Experts said the markets Covid-19 crisis, it said
Wealthy investors and corporate houses are and the Nifty50 remained vulnerable on Tuesday.
turning to additional tier-I bonds of large indices rising 1.6 per PAGE 9 > to the risks highlight- Although unsure of
banks in search of higher yields in a declining cent each to end at EDIT: Worrying ed by Moody’s and ~ vs $ (inverted scale) revival in demand,
interest rate environment. Investors are now
allocating as much as 10-20 per cent of their
their highest close macro dynamics also possible actions
since March 13. from other agencies.
Chief Financial Officer
Aditya Pande said
70% OF LISTED FIRMS MAY
HITTING TURBULENCE
debt portfolio in such bonds, said experts, with
bonds of State Bank of India and HDFC Bank
The rupee and However, the positive
the 10-year government momentum in the global mar-
there was a slight
uptick in forward Q4FY20 Chg
QUALIFY FOR NEW MSME SOPS
traded frequently and preferred the most. bond, too, held steady, despite kets, prospects of the reopen- bookings after the lock- ~cr (%) Nearly 70 per cent of the listed
the red flags raised by the rat- ing of the economy, and the down was relaxed. Revenue 8,634.6 4.5 universe could now be part of
ing agency. The yield on the assurance from the govern- The company Loss before the micro, small and medium
COMPANIES P2 bond softened 2 basis points ment that the economy would reported a consolidated tax 1,289.8 PTL enterprises category after the
AirAsia cuts pilot salaries to end at 5.76 per cent, while soon enter a high-growth tra-
the rupee strengthened 19 jectory kept investor senti-
pre-tax loss of ~1,290
crore in the March quar-
Net loss 870.8 PTL
Union Cabinet approved the
revised MSME definition,
by 40% for May & June paise against the dollar to end ment bullish. 10-yr G-sec yield ter as compared with a Cash 20,376.9 33.1 showed an analysis of their
AirAsia India has slashed salaries of its pilots by at 75.36. Turn to Page 13 > profit of ~626 crore in balance sales data. With this, they could
(%)
an average 40 per cent for May and June, an the year-ago period. PTL: Profit to loss; % change is YoY become eligible for
Cash balance includes restricted cash
airline source said. However, the amount of This was due to a surge Source: Company government benefits. The
reduction in pay for other categories and senior Moody’s cuts SBI, HDFC Bank ratings in cost amid tepid rev- Cabinet on Monday had cleared
management remains at the April level, he enue growth. Loss at reclassification of medium-
Global rating agency Moody’s has downgraded ratings for State
said. The senior management at AirAsia India the net level stood at ~870 crore as compared with a scale companies as those with ~50 crore as investment and
Bank of India and HDFC Bank’s long-term local and foreign
had taken a pay cut of 20 per cent in April. ~596 crore profit in the year-ago quarter. The company’s ~250 crore as turnover, up from ~20 crore and ~100 crore,
currency deposit from “Baa2” to “Baa3”. This is part of rating action
consolidated income rose 4.5 per cent year-on-year to respectively. There are 4,643 listed companies for which data
on 11 banks, after Moody’s downgraded India’s sovereign rating
~8,635 crore for the March quarter, while costs soared by is available with Capitaline. SACHIN P MAMPATTA writes 10 >
COMPANIES P2 from “Baa2” to “Baa3” with a negative outlook. 4>
nearly a third to ~9,924 crore. Turn to Page 13 >
Entertainment on big
screen, six feet apart
Why ‘Mitron’ may not be a real friend
The final part of the series
looks at how multiplexes
are gearing up to do
business once the
lockdown is lifted. The next
time you walk into a
The video-sharing app fuelled by anti-Chinese sentiment has been taken down from Google Play Store
REBOOT-III cinema hall be ready to find NEHA ALAWADHI codes for popular apps like Instagram, Tinder,
MULTIPLEXES an empty seat next to you,
writesVIVEAT SUSAN PINTO
New Delhi, 2 June FALL FROM GRACE Uber etc. If just the source code was enough,
anyone could have built these apps,” said Deepak
Several attempts have been made in the past to | Growing sentiment | Reached | Mitron team Abbot, founder of financial technology firm Flat
promote swadeshi products but few have enjoyed against Chinese apps over 5 million worked in stealth White Capital.
the roaring success of the short video app ‘Mitron’ fuelled growth of downloads mode, no clarity on What needs to be commended, said Abbot, is
> RESULTS RECKONER — just a month old — before it was taken down TikTok clone Mitron in less than a month who owns or runs it the hacker mindset of the team that developed
from the Google Play Store on Tuesday. Mitron. “They used the right name, identified the
Quarter ended Mar 31, 2020; common sample With over five million downloads since its | A Pakistani firm claims | Study found | Google Play right opportunity at the right time and used the
of 377 companies (results available of 394) launch in April, the developers or owners of the that app’s source code many clone apps Store has right kind of WhatsApp marketing and got as
SALES
app managed to leverage two things: naming the was bought from it for contained malware suspended many downloads as they did in such a short
app ‘Mitron’, a term made popular by Prime $34 on code marketplace and poor data Mitron for policy period of time.”
Mar 31, ’19 16.5% ~8.13 trillion  Minister Narendra Modi who is perceived as a CodeCanyon usage policies violation The growing sentiment against Chinese apps,
Mar 31, ’20 -2.5% ~7.93 trillion  champion of nationalism, and feeding the need to leading to uninstall campaigns on social media
find an alternative to China’s TikTok. platforms, coupled with the Prime Minister’s call
PROFIT BEFORE TAX Though it has been reported that the team repetitive content. Examples of violations include Qboxus. The sale took place on CodeCanyon, a to be ‘Vocal for Local’ fuelled Mitron’s growth to a
Mar 31,’19 44.2% ~95,162 cr  behind the app is led by an IIT alumnus by the ‘Copying content from other apps without adding marketplace for the buying and selling of scripts, large extent.
Mar 31, ’20 -17.5% ~78,508 cr  name of Shivank Aggarwal, attempts to trace this any original content or value’ and ‘Creating entire apps, and components for a variety of Qboxus’ ‘TicTic’ — an Android media app for
person led to a dead end. The team went by the multiple apps with highly similar functionality, languages and frameworks. creating and sharing short videos v2.5, available on
NET PROFIT name of ShopKiller and maintained that it was content, and user experience’. Branded a ‘Pakistani app’, the initial euphoria CodeCanyon for $34 (about ~2,570) — is one of the
Mar 31, ’19 35.0% ~65,011 cr  working in stealth mode. Mitron’s popularity would probably have around Mitron’s rise collapsed like a souffle. bestselling app codes this week. The developer also
Mar 31, ’20 -6.1% ~61,073 cr  Google confirmed the suspension of the app continued had it not come to light that the source The developer community, however, says that sells an Android code for ‘Hashgram’, a clone of
from its Play Store. The Google Play Store has a code of the app was developed in Pakistan. The buying source codes of popular apps is quite a Instagram ($19), ‘Binder’, a dating app like Tinder
Companies with zero sales excluded; given the change in corporation
tax rates, to give a fair comparison the profit before tax has been ‘Spam and Minimum Functionality Policy’ and entity called ShopKiller had bought the app’s common practice everywhere in the world. ($44) and several other ready-to-use codes for e-
considered; compiled by BS Research Bureau Source: Capitaline can take down apps for, among other things, source code from a Pakistan-based firm called “There are at least 500 developers selling source commerce and food ordering websites. Turn to Page 13 >