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Indian airports are Terminally ill
Also in today’s edition: Xi turns China’s agent of chaos; NBFCs are a shadow of their former selves; Aryan Khan, the businessman; TCS in trouble
Good morning! Jin is officially in the army. Bloomberg reports that the 30-year-old member of K-pop phenomenon BTS was drafted in a boot camp on Tuesday as part of South Korea’s mandatory 18-month conscription. BTS’ younger members will also serve their time in the military, meaning the supergroup may only reconvene in 2025. Three hundred cops were roped in to maintain order during Jin’s farewell at the Yeoncheon base. Hang in there, Army.
🎧 From FTX founder SBF's arrest in the Bahamas to Binance trying to be the good guy, there's a lot happening in crypto. The Signal Daily is available on Spotify, Apple Podcasts, Amazon Music, and Google Podcasts, or wherever you listen to your podcasts.
The Market Signal*
Economy & stocks: Taking advantage of buoyant equities, mutual fund investors encashed SIPs worth ₹10,000 crore in November, the Business Standard reports.
The most benign retail inflation number in a year fuelled stocks to rally in the US. Clear indication that the economy is slowing held out hope that the Fed Reserve will further ease up on its pace of rate hikes.
Bloomberg reports OPEC as saying it expects oil demand to slow down in 2023. It has just implemented a 2 million barrel production cut.
Early Asia: The SGX Nifty ascended (+0.51%) at 7.30 am India time. The Hang Seng Index (+0.85%) and Nikkei 225 (+0.61%) entered positive territory.
Xi Goes From Frying Pan To Fire
Last month, we wrote about how the protests in Beijing and beyond followed a critical development: the Chinese Communist Party (CCP) and state media stopped calling the president “the people’s leader”. Fazed by unprecedented dissent, Xi Jinping reversed his rigid Covid Zero policy… and in doing so, unleashed chaos.
Details: Xi’s poorly-planned U-turn has left hospitals struggling to serve an under-vaccinated population that’s also suffering his refusal to import foreign vaccines. An Omicron outbreak in China may initially claim 620,000 lives.
This could incense the Chinese more than the policy that subjected them to incessant testing and confinement. Xi’s flip-flop is a subversive message that the CCP—which convinced a country that collective well-being is worth the trade-off with authoritarianism—is now leaving people to fend for themselves. Countries learnt long ago that Covid Zero doesn’t work; Xi’s belated realisation has put China
🎧 China's decision to reopen its economy could kick off another wave of infections, and potentially fuel a global crisis. The Signal Daily is available on Spotify, Apple Podcasts, Amazon Music, and Google Podcasts, or wherever you listen to your podcasts.
Blame it on tightening regulation and rising costs: shadow banks have caught a cold. Their market share in lending has shrunk from a record 23.1% in the first half of FY19 to 19.8% in the first half of FY23.
Rules & more rules: India’s central bank has been introducing stiffer regulation to de-risk non-banking financial companies (NBFCs). It has put 16 shadow banks in an “upper layer” list where they’ll face more regulation.
Most NBFCs rely on market borrowings for lending. That makes them less competitive, as banks have access to low-cost savings deposits and zero-cost current accounts of customers. A Business Standard analysis shows 31 listed banks’ share in lending rose 20.4%, while that of 41 NBFCs rose only 11.1% in the first half of FY23.
The overall share has also shrunk because some biggies such as IL&FS, DHFL, and Reliance Capital went bust, and HDFC Ltd has merged with HDFC Bank.
India’s busiest airport has never seemed busier.
Terminal 3 of Delhi’s Indira Gandhi International Airport has been chaos central over the past few days, thanks to the holiday season and revenge travel post-Covid. Social media is rife with posts about serpentine security-check queues, lack of staff support, overall disorderliness, and missed flights.
IndiGo has asked passengers to arrive at least 3.5 hours before departure for *domestic* flights.
Early morning at a Delhi fish market! At least a dozen scuffles have broken out in the last 20 mins. #DelhiAirport
Dec 13, 2022
1.63K Likes 292 Retweets 139 Replies
Why?: The Delhi airport is expanding to accommodate 100 million passengers annually. Currently, only Terminal 3, which handles international flights and some domestic flights, is fully functional.
After being cooped up at home for the better part of the last two years, Indians are travelling. On December 11, domestic airlines flew over 4,27,000 passengers—the highest since May 2020. And Delhi airport, which welcomes ~200,000 passengers daily, is struggling to rise to the occasion thanks to the expansion work.
The civil aviation ministry is concocting a four-point action plan to deal with the situation. This includes reducing the number of peak-hour flights from 19 to 14 and shifting some flights from T3 to the two other terminals. It’s also pushing people to use DigiYatra, the government’s new facial recognition app that facilitates contactless air travel, although this comes with its own set of problems.
The ongoing security architecture overhaul at Indian airports might also have played a role in the chaos.
The Devil Is In The Details
Aryan Khan is following in the footsteps of his father Shah Rukh Khan. No, not the actor but SRK, the businessman.
Rollup Play: Khan junior (25), who is writing for his first directorial foray, has launched Slab Ventures, a luxury lifestyle rollup based in the Netherlands. It will dabble in alcohol, apparel, accessories, and experiential events under the umbrella brand D’yavol, which means devil in Bulgarian.
Starting with cheers: For alcohol, it has partnered with AB InBev, the maker of Budweiser, which is now also making whiskey for India. It’s a global first for the beermaker and perhaps shows it is resigned to the fact that what Indians expect from their tipple is a high. ASAP.
Smart move: D’yavol will begin with a bespoke Polish vodka and follow with dark spirits. The advantage of having an umbrella brand that includes liquor is the other products can be surrogates. Shrewd!
TCS Gets Served
India’s largest information technology exporter is facing a class action lawsuit from a former (American) employee, who says the company indulges in discriminatory hiring practices.
Shawn Katz, who worked with TCS for over nine years, claims the company has a “disproportionate workforce” consisting of about 70% South Asian—mostly Indian —employees who’re in the US on work visas. In contrast, Katz continues, the US IT industry comprises just 12-13% of South Asians.
Wipro, HCL, and Infosys were also accused of discriminatory hiring in the past. TCS faced an identical lawsuit in 2018, but won.
Katz’s suit contrasts a Nomura finding that 60% of Indian IT majors’ US employees are citizens of the country, perhaps due to their ramping up of local hiring since 2020. Up until the Trump administration’s suspension of foreign-worker permits, Big Tech companies were the biggest beneficiaries of H1-B visas.
Headed out?: In what could be India’s largest pharma deal, Chinese healthcare giant Fosun is reportedly courting buyers for Indian generic injectables maker Gland Pharma, which has a market cap of $3.5 billion.
Another one on the block: Kumar Mangalam Birla is looking to sell Aditya Birla Insurance Brokers, one of India’s largest composite insurers.
From CZ…: Crypto exchange Binance temporarily halted withdrawals of the stablecoin USDC shortly after concerns surfaced over its proof of reserves and a potential criminal investigation.
…to SBF: The US SEC officially charged former FTX chief Sam Bankman-Fried for defrauding equity investors of over $1.8 billion.
Disconnected: Meta is shuttering Connectivity to split the division—which oversees projects such as low-orbit satellites and solar-powered drones—into two groups.
Cue the filth: Elon Musk dissolved Twitter’s Trust & Safety Council, the advisory group of activists, human rights organisations, and civil rights leaders that provided inputs on platform issues such as hate speech and child safety.
Join forces: Viacom 18 may consolidate its streaming platforms such as JioCinema and VOOT among others under one super app.
THE DAILY DIGIT
The number of days it took the Bombay Stock Exchange (BSE) to add 10 million registered investor accounts. The total figure now stands at 120 million. (Business Standard)
A MESSAGE FROM OUR PARTNER
A Bag to Brag
What’s a bag? That which we call a bag will, in any form, do just fine, you say? (Sincere apologies to The Bard.)
A bag you may call it, but does it hold the tools—laptop, tablet, wires—of a modern-day pro? Some are priced so high that Shylock would shudder.
A new way: So we took it upon ourselves to design the ideal sack to sling over your shoulders. We questioned, we researched, and we found newer and better ways to make bags.
9-9 ready: The stylish bags from House Of Brands Company (HOBC)—which launches products every Friday morning—have thoughtfully designed pockets and sleeves to safekeep gadgets, accessories, documents, and even makeup and sunglasses. Only a Kangaroo would have a better pouch.
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Search party: This isn’t a plug for Google, although the company may as well use this story for future campaigns. One of the few things Thirumaran, 55, knew about his father K Ramasundaram—who died when Thirumaran was an infant—was that he was a school teacher in Malaysia. He wanted to locate his father’s grave but didn’t know where to begin. Enter Google search. What started with Thirumaran’s students identifying his father’s school ended with Ramasundaram’s former students locating the grave itself. And Thirumaran, who’d been searching for answers his whole life, could finally pay his respects.
Berry problematic: North Korea is nuts about Japanese beverages, and Phua Sze Hee is jail bound for trying to fulfil that demand. A Singapore-based former employee of Japanese beverage brand Pokka, Phua exported ~$1 million worth of products to Pyongyang. This violates Singaporean law, which bars citizens from having commercial dealings with North Korea. What products did Phua export? Over 8,500 cartons of Pokka Strawberry Milk and nearly 6,000 cartons of Premium Milk Coffee Regular between 2017-2018.
Quality control: Deep in the heart of Lahore’s Gawalmandi neighbourhood lies a hole-in-the-wall tandoor deemed Pakistan’s most expensive restaurant. Its name is Baking Virsa, and its owner Bilal Sufi could give grumpy Irani café owners a run for their money. Baking Virsa serves no water and accompaniments, and doesn’t entertain walk-ins—patrons must call in at least two days in advance and specify what they want to eat. A dinner here costs $60. Perhaps because Bilal’s goats are fed a diet of unripe bananas, dates, and saffron milk.
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