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Paytm, the Indian digital payments startup whose stock has slumped 71% since its November market debut, had its price target reduced further by an Macquarie Capital Securities (India) Pvt. analyst who was early to predict the company’s market troubles.

Macquarie’s Suresh Ganapathy cut his price estimate to 450 rupees ($5.90) from 700 rupees, citing lower valuations for fintech companies globally. He didn’t change his earnings or revenue estimates for Paytm, which he rates underperform. The stock rose to 634.05 rupees on Wednesday.

Paytm pulled off the largest-ever initial public offering in India, but has since faced a number of challenges. Ganapathy cited fintech regulations and stricter compliance norms as potential headwinds -- on Friday, the Reserve Bank of India barred the company’s Paytm Payments Bank venture from accepting new customers, adding pressure on the stock.

The average 12-month price target among nine analysts covering Paytm is 1,203 rupees, according to data compiled by Bloomberg.

The initial public offering by One 97 Communications Ltd., the parent company for Paytm, had been touted by some as a symbol of India’s growing appeal as a destination for global capital, particularly for investors looking for alternatives to China.

Ahead of the listing, Macquarie analysts including Ganapathy initiated coverage with an underperform rating and a price target of 1,200 rupees. The IPO was priced at 2,150 rupees.

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ndia is boosting fertiliser imports from nations including Canada and Israel to ensure sufficient supplies for the coming summer sowing season after the disruption of shipments caused by Russia's invasion of Ukraine.

India is a leading importer of fertilisers for its huge agriculture sector, which employs about 60% of the country's workforce and accounts for 15% of the $2.7 trillion economy.

"This time we have made advance preparations for kharif (summer sown crop) season. We need about 30 million tonnes of fertilisers and arrangements are in place," fertiliser minister Mansukh Mandaviya told Reuters, without elaborating.

He said India will have a comfortable opening stock, about a quarter of the overall amount of fertilisers needed for the summer season.

Indian farmers usually start planting crops including rice, cotton and soybean with the arrival of monsoon rains in June.

To fertilise the crops, India depends on imports for its entire annual consumption of 4 million to 5 million tonnes of potash and ships in a third of this from Belarus and Russia.

Landlocked Belarus uses ports in Russia and Lithuania for its exports.

Following Russia's invasion of Ukraine, shipping routes have been closed off and western sanctions on Moscow, which has described its actions in Ukraine as a "special military operation", have made it difficult to trade with Russian and Belarusian companies.

Indian Potash Ltd (IPL) has increased imports from Canada, Israel and Jordan.

It will buy 1.2 million tonnes of Potash from Canada, 600,000 tonnes from Israel and 300,000 from Jordan in 2022 to partly replace supply from Russia and Belarus, numerous sources said.

A senior industry official who declined to be named said IPL was trying to ensure that "a substantial amount of shipments" arrive before June to prevent any shortage during the sowing season.

India was close to signing a three-year fertiliser import deal with Russia during Mandaviya's visit to Moscow planned for this month. The visit was postponed following the Ukraine invasion, which began on Feb. 24.

One of the sources said India may try again to sign the deal "when the situation improves".

Traditionally India has used prices struck in deals with Belarus and Russia as the benchmark for supplies from other countries. For 2022, Canada has emerged as a price setter, the sources said.

IPL is buying potash from companies in Canada and Israel at $590 per tonne on a delivered basis with six months credit in 2022. IPL declined to comment.

India also relies on Russia and Belarus for complex fertilisers that provide more than one crop nutrient.

To help make up for any lost supplies of nitrogen, phosphate and potash, Indian companies are also increasing supplies from Saudi Arabia and Morocco, the sources said.

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In the end, Indian billionaire Mukesh Ambani settled the dispute over who gets to own the assets of beleaguered Future Retail Ltd. not in an arbitration tribunal in Singapore, or in a courtroom in New Delhi, but in a shopping aisle.

Future Retail had been subleasing store space from the tycoon’s Reliance Industries Ltd. Indeed, it was kept operating only on Ambani’s forbearance because Future couldn’t come up with the rent. But with Amazon.com continuing to block Reliance’s $3.4 billion purchase of Future’s assets, Ambani decided to make the acquisition a fait accompli: He terminated the leases and is taking control of the properties.

It was a dramatic denouement to a three-year-old saga. Amazon was Future’s original rescuer, investing $192 million into a gift voucher unit controlled by its founder Kishore Biyani so he could use the money to steady the debt-laden Indian retailer.

The condition of that 2019 deal was that assets — about 1,500 stores nationwide — wouldn’t be sold to Ambani, who owns India’s largest retail empire. When Biyani did exactly that after Covid-19 decimated operations, Amazon began proceedings against Future for breach of contract. The Reliance deal was in limbo — until Ambani decided he’d had enough.

The desperation was palpable in the messages Future sent Reliance. “Please confirm that there will not be any reduction in consideration payable,” said a March 2 missive from Future, as reported by Saritha Rai and P R Sanjai of Bloomberg News. Then, one paragraph later, “It is important for our stakeholders to have visibility on the final consideration.” Was Future Retail living under a rock? Its bailout by Ambani was always clearly a commercial deal, not a humanitarian mission. It was Future’s job to take care of its stakeholders, including creditors.

And where’s Amazon in all this? By now, it must have learned that taking on Ambani on his home turf was futile. Once the ground had shifted from under its feet, Amazon offered an out-of-court settlement over its funds infusion in Future Coupons Pvt. — which had been its first move in the drama. Amazon couldn’t have rescued Future Retail directly because India’s draconian foreign direct investment rules were in the way. So it did the next best thing: funding privately held Coupons and, thus, indirectly exercising some control over Retail.

That control proved to be tenuous. After it agreed to Reliance’s deal, Future wanted to wriggle out of the contract with Amazon. Its independent directors complained to India’s trustbuster that the multinational firm had deliberately misled the authority about the true nature of the Coupons deal, which effectively put Amazon in the driver’s seat at Retail, violating India’s 2018 foreign direct investment law. The regulator promptly suspended its earlier approval of Amazon’s investment, and the Delhi High Court halted the Singapore arbitration panel’s work. (Singapore’s reputation as an Asian arbitration hub draws many cross-border deals to the city-state.)

But if the near-bankrupt firm with a net worth of negative $280 million was betting that Rescuer No. 2 would wait patiently as it sorted out its legal troubles with Benefactor No. 1, it misjudged the situation. According to a March 9 disclosure by Future Retail, 342 of its large stores and 493 of smaller outlets — constituting 55% to 65% of retail revenue — have so far received termination notices of sub-leases from Reliance entities.

It’s disingenuous for Future to now appear shocked, shocked, that its preferred savior is moving in before consummating the formal purchase, doing everything to make an omelet that can’t be unscrambled by any authority: Possession, after all, is nine-tenths of the law. Amazon had given the loss-making firm an option as late as January for a further $914 million bailout, but Future's independent directors judged the offer to be inadequate, given the ballooning debt. As things stand, it’s for Future’s 2025 dollar bondholders to figure out if they’ll be made whole. Trading around 60 cents to the dollar through the stealth acquisition, the notes don’t seem to be indicate a surfeit of creditor confidence.

How does a physical takeover work? There’s inventory, furniture, lighting and point-of-sale equipment, all pledged to creditors. “Your insistence of removing all such assets from the stores may not be practically possible and such removal may result in irreversible losses in terms of value,” says a March 5 letter to Reliance, this time by Future Lifestyle Fashions Ltd. “We would request your goodselves not to take any actions with respect to the assets as well as premises till we can discuss ….”

There’s nothing left for the “goodselves” at Reliance to discuss. The upshot is this: On the prodding of Future Retail, the Indian justice system put a bullet through the country’s arbitration law, never giving it a chance to settle a simple commercial dispute. The consequences are for Future — and India — to bear.

It’s now clear that, when faced with muscular opponents, the odds of enforcing a contract in the country are slim. Nobody ought to complain if foreigners are skeptical of India’s reported strides in “ease of doing business.” But then, it’s a fast-modernizing market of 1.4 billion consumers. Amazon can’t give up on it. The Seattle-based firm alleged in a March 15 newspaper ad that Future was trying to remove the “substratum of the dispute” by transferring its stores to Ambani in a “clandestine manner.” The e-commerce giant also informed India’s top court that truce talks had failed. It’s hard to say if Amazon’s continued protests will dissuade Future's lenders from blessing the de facto change of control — or if it’s already too late for that.

As for Future, it doesn’t have much of one. Going extinct is a feature of capitalism. But the ignominious manner in which an Indian pioneer of modern retail got taken apart store by store because of the wrong choices it made should be a case study. However, before academics get busy, creditors need to find out where the shopping racks and the cash machines are kept. It’s their collateral, after all, and the overarching lesson of this contest has been that everyone should grab what they can. While stocks last.

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Around 66 per cent of the BSE 500 universe is in the red since October, with 71 stocks losing more than 25 per cent of their value.

The conflict between Russia and Ukraine and the subsequent market correction may appear to be a good opportunity for investors to nibble into these stocks. But market watchers are of the opinion that valuations are still expensive and there is no clear answer to whether the markets have turned attractive.

“Given India’s already stretched equity valuations and global headwinds, we believe the market may remain choppy and advise investors to wait for better entry opportunities and invest only upon large corrections,” said a recent note by Credit Suisse Wealth Management India.

Foreign portfolio investors (FPIs) remain uncomfortable with India’s valuation premium and have sold about $20 billion since October. Nevertheless, domestic institutional investors (DIIs) and retail investors have absorbed a significant portion of selling pressure, so far. The mammoth LIC initial public offering, expected over a few weeks, may also impact liquidity, leading to a further correction.

The benchmark indices have recouped losses over the last few sessions after a steep correction the week before and are down 3 per cent in the year to date.

The market may not be fully factoring in the longer-term impact of the rising interest rates and inflation. “The impact of the Russia-Ukraine war on global inflation, commodity prices, and supply chain can only be known over the next two quarters. And we are yet to figure out the impact of the rising interest rates and inflation in India,” said Deepak Jasani, head-retail, HDFC Securities.

FMCG companies in India, for instance, have already effected price hikes of 10-25 per cent across categories, such as soaps, shampoos, paints, biscuits and edible oil in FY22.

The ongoing crude and commodities shock in the wake of the Russia-Ukraine conflict is likely to have negative implications for India’s macro situation in terms of higher inflation and bond yields, higher current account deficit, weaker INR, and potentially weaker consumer demand, and thus a lower GDP growth rate.

Some market watchers believe that the recent correction in the market has made valuations more palatable. At 18.1x currently, the Nifty index valuation appears to be expensive relative to the 20-year average of 16.1x and reasonable versus the 10-year average of 18.5x, according to Emkay’s India strategy report. The Nifty composition has changed towards higher P/E (growth) stocks, which makes recent averages more relevant, it said.

“Several stocks have corrected 25-50 per cent from their peak over the past 4-5 months. The conflict between Russia and Ukraine poses a near-term headwind but there is scope for bottom-up investing in the mid- and small-cap segments,” said Sachin Shah, Fund Manager, Emkay Investment Managers.

Kotak Institutional Equities says it finds reasonable reward/risk balance in sectors, such as banks and diversified financials, capital goods, real estate and specialty chemicals, while valuations of most ‘growth’ stocks remain rich.

Also Read |  World Consumer Rights Day │ Fintech firms must examine robustness of their tech platforms

The advent of numerous fintech companies on the horizon is a great advertisement of the enormous business opportunities that India provides, and can, also significantly advance the cause of financial inclusion in the country.

As we observe World Consumer Rights Day 2022 on March 15, for which  ‘Fair Digital Finance’ has been chosen as the theme, it would thus be fitting if the occasion could lead to a relook by fintech companies at their technology platforms and algorithmic models to find out how these may be improved to better serve customer interests.

At a time when a large quantum of transactions is being done digitally, technology vulnerability of fintech companies, especially their inability to adequately safeguard customer data, could have adverse connotations not just for the specific entities and their clients, but the entire financial sector. The cumulative value of digital transactions in India surged from Rs 15,887.88 crore in April 2021 to Rs 23,099.34 crore in February.

In April, a World Bank Group Policy Research Paper titled ‘Consumer Risks in Fintech – New Manifestations of Consumer Risks and Emerging Regulatory Approaches’ had also emphasised this fact by stating: “Platform or other technology malfunctions can have adverse impacts on consumers ranging from inconvenience and poor service to monetary loss and loss of data integrity, the risk of which may be increased due to heavier reliance on automated processing of transactions”.

Making the algorithmic process fairer could ensure that it is not being discriminatory towards any demography, socio-economic category, and place of stay of likely customers. More importantly, a periodic review of the algorithms used could prove handy in determining whether these are in line with international best practices, and appropriately factors in the India context.

The 2,000-plus fintech companies operating in India — the overwhelming majority of which have come up in the last five years — could also examine whether their governance models and existing systems and processes are robust enough to handle rapid growth, while not compromising with the quality of service they provide to customers.

Embarking on such an exercise could benefit the fintech segment overall in terms of being able to identify and address the likely pain points that may emerge in future through an unbridled rise in transaction numbers. An initiative of this kind could also make the sector more resilient through the introduction of upgraded systems and processes, including the way it meets its manpower requirements and trains employees for their assigned jobs.

From an individual fintech company’s perspective, the gains from such efforts could be in the form of becoming more sustainable, an increase in its customer-centricity, and a rise in its attractiveness among potential investors. All these combined could help a company stand out from its peers in a market that is increasingly getting commoditised.

Given the importance of the financial sector in the economy, authorities, too, may consider stepping up their vigil to ensure that fintech startups are not overreaching themselves to achieve ‘unicorn’ status at the earliest and, also, not luring customers with lofty promises that they may find difficult to meet later. Authorities taking a closer look at how the fintech companies are going about their jobs could lead to the long-term sustainability of the sector by ensuring that its operations remain within a defined rule-bound framework. Moreover, it would reduce the likelihood of some fintech firms trying to play fast and lose to earn more money in the quickest possible time.

Significantly, it would further increase the faith of ordinary people in fintech companies as authorities could nudge fintech companies to provide more information on customer grievance handling processes, including likely turnaround times to settle complaints.

There is little chance of some level of pro-activism shown by authorities to protect customer interests coming in the way of the growth of the Indian fintech sector, including overseas investment flows into this arena. No progressive fintech company or likely investor would mind that as they too realise that for authorities anywhere citizen interests would always come ahead of everything else.

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Biological E's Corbevax will be administered to 12-15 years age-group.

The National Technical Advisory Group on Immunization (NTAGI) is learnt to have given its recommendation to begin vaccination of children in the 12-15 years age group.

"The vaccination of children in the age group of 12 -15 years is most likely to begin from Tuesday. Also, the co-morbidity clause for administering precaution doses to those aged 60 years and above would be removed," an official source said.

he countrywide vaccination drive was rolled out on January 16 last year with healthcare workers (HCWs) getting inoculated in the first phase. The vaccination of frontline workers (FLWs) started from February 2 last year.

The Centre is likely to begin the Covid vaccination for children in the age group of 12 -15 years this week, while the co-morbidity clause for administering precaution doses to senior citizens would be removed, official sources said on Monday.

Biological E's Corbevax will be administered to 12-15 years age-group.

The National Technical Advisory Group on Immunization (NTAGI) is learnt to have given its recommendation to begin vaccination of children in the 12-15 years age group.

"The vaccination of children in the age group of 12 -15 years is most likely to begin from Tuesday. Also, the co-morbidity clause for administering precaution doses to those aged 60 years and above would be removed," an official source said.

The countrywide vaccination drive was rolled out on January 16 last year with healthcare workers (HCWs) getting inoculated in the first phase. The vaccination of frontline workers (FLWs) started from February 2 last year.

The next phase of COVID-19 vaccination commenced from March 1 for people over 60 years of age and those aged 45 and above with specified co-morbid conditions.

The country launched vaccination for all aged more than 45 years from April 1, 2021.

The government then decided to expand its vaccination drive by allowing everyone above 18 to be vaccinated from May 1 last year.

The next phase of COVID-19 vaccination commenced from January 3 for adolescents in the age group of 15-18 years.

India began administering precaution dosez of COVID-19 vaccine to healthcare workers, frontline workers, including personnel deployed for election duty and those aged 60 and above with co-morbidities, from January 10 this year amid a spike in coronavirus infections fuelled by Omicron variant of the virus in the country.

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The Employees’ Provident Fund Organisation (EPFO) on Saturday decided to pay 8.1 percent rate of interest on provident fund deposits for the current financial year 2021-22.

This is lowest in over one decade and likely to dissapoint over 60 million of its salaried class subscribers.

“The central board has declared 8.1 percent interest rate keeping in view and taking into account its income of Rs. 76,768 crore,” a CBT member said as the meeting is underway.

Last fiscal, this interest rate was 8.5 percent.

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(This is a developing story and will be updated soon)

Ahead of its initial public offering (IPO), Life Insurance Corporation’s (LIC) net profit surged to Rs 234.91 crore in September – December quarter (Q3FY22), owing to the change in surplus distribution model, wherein shareholders will now get a larger share of the surplus than earlier. In the same period last financial year, LIC’s net profit totaled Rs 0.91 crore. For the 9 months ended FY22 (April – December), net profit of the insurer stood at Rs 1,642.78 crore.

LIC had a single “life fund” before Section 24 of the LIC Act was amended by the government to bring its surplus distribution mechanism at par with private life insurers. Now, the life fund has been segregated into two funds – participating policyholders fund and non-participating policyholders’ fund. Consequently, the surplus distribution in the participating policyholders’ fund has been modified to 90:10 in a phased manner, wherein 90 per cent will go to policyholders and 10 per cent to shareholders. Further, 100 per cent of the surplus generated out of the non-participating business will be available for distribution to all shareholders.

This change, according to M R Kumar, chairman LIC, will help LIC increase its profitability, a metric that will be closely tracked once it gets listed. “Going forward, with the change in surplus distribution, profitability will increase. Beyond that, it’s a question of how the product mix changes, penetration, more coverage to people, getting into sectors where we have been missing out. So, that should take care of the profits,” Kumar had said.

Premiums of the insurance behemoth increased 0.8 per cent to Rs 97,761 crore in Q3FY22 from Rs 97,008 crore in the year-ago period. In the first 9 months of FY22 (9MFY22), premiums of the insurer, which includes first year premiums, renewal premiums, and single premiums, totaled to Rs 2.84 trillion, up 1.67 per cent year-on-year (YoY).

Persistency ratio of the insurer dipped in Q3FY22, with the thirteenth month persistency ratio at 69.23 per cent compared to 72.98 per cent in the same period a year ago. But the 61st month persistency inched higher than the year ago period to stand at 57.28 per cent. Persistency ratio is the ratio of life insurance policies receiving timely premiums in the year and the number of net active policies. The ratio indicates how many policyholders are paying the due premiums regularly on the policies with the insurer.

The solvency ratio -- a measurement of the entity’s ability to meet its debt obligations and other financial commitments – of the insurer improved to 1.77 as of December, 2021, compared to 1.64 in the same period last year. The minimum regulatory requirement is 1.5.

The non-performing assets (NPA) ratio also saw sharp improvement, with the NPA ratio at the end of Q3FY22 standing at 6.32 per cent compared to 7.78 per cent in the same period a year-ago. And, net NPA ratio improved to 0.04 per cent compared to 0.14 per cent in the same period.

LIC filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) on February 13, thus setting the ball in motion for the country’s largest-ever public listing. The government will sell 5 per cent of its stake, or 316.25 million shares of its over 6,325 million shares. The government owns 100 percent of LIC. Sebi has cleared the DRHP of the state-owned Life LIC. Following the market regulator’s nod to the IPO papers, the insurer can launch its share sale. However, LIC may not launch its IPO immediately given the current volatile market conditions.

The government is hoping to launch the IPO as soon as stock market volatility, sparked by the Russian invasion of Ukraine, recedes.

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India has been very good at managing its finances but the surge in global energy prices is going to have a negative impact on its economy, said Kristalina Georgieva, the Managing Director of the International Monetary Fund.

During a media roundtable on Thursday on the Russian invasion of Ukraine and its global impact, Gita Gopinath, who is the First Deputy Managing Director of the IMF, observed that the war has posed a challenge to economies around the world, including India.

"India relies heavily on energy imports and the price is going up. That has implications on the purchasing power of Indian households. "If you're looking at headline inflation numbers, inflation in India is close to around six per cent, which is the upper end of the inflation band for the Reserve Bank of India," Gopinath said.

This has implications on the monetary policy in the country and it is a challenge in many parts of the world, not just India, she said. Georgieva said, "Clearly the most significant channel of impact on the Indian economy is energy prices."

India is an importer and the increase in energy prices is going to have a negative impact, she said, adding, "India has been very good in managing its finances." She stressed that there are some fiscal spaces to be able to respond to the challenge.

"Our advice to our members is first and foremost make sure that you protect the most vulnerable populations from the shot up of prices, not only energy but also foot food prices for countries where this is going to be a significant factor," the IMF managing director said.

"Target your fiscal space to those that are in a grievous need to be supported. We would also be looking into monetary policy responses, as to how could they be calibrated appropriately to what is happening," Georgieva added.

Also Read | US steps up pressure on Russia for Ukraine war, calls for raising tariffs