India unwrapped: Storms hit north India and IndiGo; Karnataka battle heats up
Photo Credit: Shah Junaid/VCCircle

Even as freak storms wreaked havoc in north India and killed more than a hundred people in their wake, the political storm leading up to the 12 May Assembly elections in Karnataka only seems to be gathering strength.

The state’s ruling Congress and the Bharatiya Janata Party (BJP) continued to trade barbs in the run up to the vote. Prime Minister Narendra Modi claimed that under Chief Minister Siddaramaiah’s rule, state capital Bengaluru had turned into a “valley of sin” as its reputation was “ruined”.

For his part, Siddaramaiah said that not only had his government been “scandal-free", but that Karnataka had topped 31 key socio-economic indicators.

Both parties have deployed their top brass including BJP president Amit Shah, Uttar Pradesh Chief Minister Yogi Adityanath, and Congress chief Rahul Gandhi, as they seek to win the state. The election outcome will set the stage for next year's general elections.

In the national capital, the central government had to deal with an avoidable controversy at the National Film Awards. At least 50 recipients boycotted the function after being told that President Ram Nath Kovind would confer only 11 awards while the rest would be handed out by Union ministers Smriti Irani and Rajyavardhan Rathore in what constituted a departure from tradition. Kovind expressed surprise at the backlash while the government was left red-faced.

Startup scan

Meanwhile, the biggest deal is India's e-commerce space appears close to fruition, with Bloomberg reporting on Friday that Flipkart's board had approved a 75% stake sale for around $15 billion to a group led by US retail giant Walmart.

Earlier in the week, Flipkart's nearest rival Amazon was said to have made a formal offer to buy a majority stake in the homegrown e-tailer. However, that offer would likely meet with valuation and regulatory obstacles.

Should the deal with Walmart go through, reports suggest that Flipkart co-founder Sachin Bansal will leave the company while fellow co-founder Binny Bansal and chief executive officer Kalyan Krishnamurthy will stay on and run the firm along with Walmart's nominees.

Bansal and Japanese investor SoftBank, which owns a stake in Flipkart, are said to be in favour of joining hands with Amazon.

And speaking of SoftBank, Mint reports that homegrown ride-hailing unicorn Ola's CEO, Bhavish Aggarwal, is at loggerheads with the Japanese investor.

Aggarwal is said to be wary of letting investors call the shots for fear of being gradually edged out, having seen the Bansals suffer that fate at Flipkart.

Corporate radar

On the corporate front, the prospects of a first major deal under the country's new insolvency and bankruptcy code suffered a setback as the National Company Law Tribunal stayed the sale of beleaguered steelmaker Electrosteel to Anil Agarwal-promoted Vedanta Resources.

The decision came following objections from rival bidder Renaissance Steel, which questioned the evaluation process adopted by the resolution professional.

The government has been tom-tomming the bankruptcy code as the solution for burgeoning bad debt, which has brought several state-owned banks to their knees.

The government, however, can take some solace from the fact that collections under the Goods and Services Tax (GST) system seem to be picking up. GST collections in April stood at Rs 1.03 trillion, crossing the Rs 1 trillion mark for the first time since the new tax regime was rolled out in July last year.

Meanwhile, India’s largest private airline IndiGo had perhaps its worst week in more than two years, as its stock tanked than 20% during the week after quarterly profits missed estimates, dropping a whopping 73% as compared to the year-ago period on the back of rising fuel costs.

The quarterly results were announced even as the market regulator, the Securities and Exchange Board of India, is probing the sudden drop in the company’s stock price just ahead of president Aditya Ghosh's resignation last week.

In the broader market, Indian shares snapped a straight run of five weekly gains with global developments and IT stocks weighing on sentiment. The benchmark BSE Sensex slipped 0.2% for the week to close at 34,915.38. The broader NSE Nifty closed the week at 10,618.25, a 0.7% fall.

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