Name:- Karan Singh

Div: PGDM MARKETING

Roll no.: 49

Article 1: Auto Comapanies at Sea over container shortages.

(High shipping freight rates and shortage of containers may disrupt supply chains of automakers)

- ECONOMIC TIMES
- 23RD DECEMEBER 2020

Increase in shipping freight rates and inadequate availability of containers globally may disrupt supply
chains and impact production of automobile companies in the country, said industry body Society of
Indian Automobile Manufacturers (SIAM). Industry executives say freight rates have increased 50-
100% and container rates have almost doubled with some companies even resorting to transporting
parts via air cargo. This has led to cost overruns and loss of revenues for exporters leading to
estimated fourth-quarter cost overruns of $ 1-1.5 billion in a month.
Meanwhile, automakers have asked vendors to increase inventory which is adding substantially to
working capital costs. “Further, there are severe shortage of containers and vessels. We are also
seeing delay in container arrivals. This situation can lead to disruption of supply-chains of Indian auto
companies over next 3-4 months and may even lead to loss of production” confirmed Rajesh Menon,
director general, SIAM.
The trade imbalance and lockdown restriction in various ports have created a container shortage in
India. This is creating double whammy for exporters as the container shortage crimps export delivery,
while shortage has lifted shipping rates that could weigh on the profitability of the exporters.
 Article 2: 7,300 crore PLI Scheme for laptops, tablets, servers by
Jan

- Economic Times
- 24 December

The government is close to moving a cabinet note to get approval for a budget of ₹7,300 crore for a
production-linked incentive (PLI) scheme aimed at boosting the manufacture of laptops, tablets and
servers in India. Officials said the contours of the scheme are being finalised and the approval could
come through as early as January. The target is to move close to 20-30% of the global production of
laptops, tablets and servers to India, the officials said. The government has reached out to HP, Dell
and Lenovo to get their feedback on the scheme. Companies had earlier urged the government to
come up with incentives for laptop and desktop manufacturing in India, which would be similar to the
scheme offered to mobile phone manufacturers. Demand for laptops and printers from corporations,
IT firms and individuals has increased following a nationwide shift to work from home and study
from home to stem the spread of the Covid-19 virus. HP recently set up a second manufacturing unit
in Chennai with contract supplier Flex to meet domestic demand for personal computers. The
government launched three mega incentive schemes totalling ₹50,000 crore in the summer, with a
significant chunk reserved for the PLI scheme aimed at boosting mobile manufacturing in the country.
The success of the scheme led the government to unveil similar incentives for 10 additional sectors
including automobiles, pharmaceuticals, solar and textiles, with a total outlay of ₹1.46 lakh crore. PLI
schemes for laptops, tablets and servers, telecom equipment and white goods are all at advanced
stages of being finalised.

Article 3: Factory Output growth rises to 8 months high of 3.6% in Oct

 - Economic Times
- 12th December 2020

The country’s industrial output growth rose for the second successive month to an eight-
month high in October, bolstered by festive demand and led by a turnaround in
manufacturing, electricity, consumer durables sectors. This is the latest in a spate of
encouraging data pointing to a recovery after the lockdown took a heavy toll on the economy.
Data released by the National Statistical Office (NSO) on Friday showed the index of
industrial production (IIP) rose an annual 3.6% in October, higher than the upwardly revised
0.5% in September and a contraction of 6.6% in October 2019.

Led by festival demand, both the consumer durables and non-durables sectors posted robust
expansion rising by 17.6% and 7.5% in October. The capital goods sector returned to the
positive zone after 21 months, rising an annual 3.3% in October compared with a 22.4%
contraction in the year earlier month. The PMI manufacturing survey has also pointed to a
recovery in the manufacturing sector although some segments display some stress.

The sector had contracted for six consecutive months since March with April posting a record
decline of 57.6%. But since May the contraction has narrowed as economic activity gathered
momentum after the lifting of the lockdown in phases. Latest data has also shown that the
economy contracted 7.5% in the September quarter, sharply shallower than the record 23.9%
decline in the June quarter.
 Article 4: Tata line up $1.2 billion for e-commerce play

- Times of India
- 10th December 2020

The Tatas are expected to buy out Alibaba’s stake of about 30% in Bigbasket. The investment in 1MG
is also expected to be a mix of primary and secondary capital infusion, with 1MG’s early investors
partially selling their stakes. In a secondary transaction, the new investor buys stake from existing
investors and the money goes to the latter, instead of the company’s coffers.
Tatas are likely to end up with around a 67% stake in Bigbasket. For 1MG, the investment is around
$250 million for a majority stake. 1MG is finalising the details of other financial investors joining the
round.
Tata Group also has ambitious plans for a super-app play, is entering segments that have received a
strong boost due to the pandemic, online grocery in particular. Bigbasket recently hit an annualised
gross sales run-rate of $1 billion. Other big groups are also investing heavily in online channels.
Reliance’s retail arm recently picked up a 60% stake in online pharmacy Netmeds.

Article 5: Excluding Investments in Jio, Telecom FDI at All-time low

 - Economic times
- 14th December 2020

Investments in Jio catapulted the flow of foreign direct investments (FDI) in India’s
telecommunication sector in the first two quarters of this fiscal to an all-time high of $16.7 billion
from an all-time low of 7 million if the Jio deals were excluded.
The sharp fall in FDI in telecom sector from $4.2 billion in FY20 to mere $7 million in FY21 can be
ascribed to inherent stress, high regulation along with intense competition in the sector. India’s total
equity inflows amounted to $30 billion, which was the highest in the comparable periods in the five
years. Equity inflows is the main component accounting for 75% of total FDI inflows in the country.
With another $6.4 billion coming into Reliance Retail, which will be recognized in the second half of
FY21 and the bullish sentiment of foreign in Indian stocks, I believe India is set to report its highest
ever equity inflows. Reliance Retail has also raised $6.4 billion from nine investors by offloading
10.9% equity to private equity and sovereign funds.