12 offshore investment funds allegedly breached disclosure regulations and exceeded investment limits while investing in Adani Group companies.

Sebi, India’s market regulator, found that twelve offshore funds investing in Adani Group companies violated disclosure regulations and surpassed investment limits, according to Reuters, citing anonymous sources. Reuters initially reported Sebi’s discovery of disclosure rule breaches by listed entities and offshore funds exceeding investment limits in August last year. Additionally, Sebi was probing the Adani Group’s association with one of the funds to ascertain potential coordination with the conglomerate’s major shareholders, an accusation previously denied by Adani.

Earlier this year, the regulator reportedly issued notices to twelve offshore investors associated with the Adani Group, outlining the allegations and seeking clarification on violations of disclosure requirements and investment limits.

“The offshore funds were reporting their investment in Adani Group companies at the individual fund level. The regulator wanted the disclosure of holdings at the offshore fund group level,” Reuters reported, citing a source.

Eight of these offshore funds have requested to settle the charges by paying a penalty without admitting guilt, as per the sources cited by the agency.

Previously, Sebi identified 13 foreign portfolio investors (FPIs) for failing to disclose information about their ultimate beneficial owners in listed Adani entities, with eight seeking resolution with the regulator on securities violation issues.

Legal representatives for Albula Investment Fund, Cresta Fund, MGC Fund, Asia Investment Corporation (Mauritius), APMS Investment Fund, Elara India Opportunities Fund, Vespera Fund, and LTS Investment Fund have collectively submitted 16 settlement applications.

The circular by DGCA now mandates airlines to allocate seats for children up to the age of 12 years with at least one of their parents/guardians.

The Directorate General of Civil Aviation (DGCA) has introduced amendments to enhance child seating arrangements on airlines. DGCA now requires airlines to ensure that children under the age of 12 are seated near at least one parent or guardian. According to the new circular, airlines must allocate seats for children up to 12 years old alongside their parents or guardians, provided they are traveling on the same Passenger Name Record (PNR). Additionally, airlines must keep a record of these seating arrangements.

“Airlines shall ensure that children up to the age of 12 years are allocated seats with at least one of their parents/guardians, who are traveling on the same Passenger Name Record (PNR), and a record of the same shall be maintained,” said DGCA in a release.

Under the revised Air Transport Circular (ATC)-01 of 2024 titled, “Unbundle of Services and fees by scheduled airlines,” some services like Zero Baggage, Preferential seating, Meals/Snack/Drink charges, charges for carriage of Musical Instruments etc. have been allowed, said a release by the DGCA.

It further added, “Such unbundled services are provided on an ‘opt-in’ basis by Airlines and are not mandatory in nature. There is also a provision for auto seat assignment to the passengers who have not selected any seat for web check-in before scheduled departure.”

“Airlines shall ensure that children up to the age of 12 years are allocated seats with at least one of their parents/guardians, who are traveling on the same PNR, and a record of the same shall be maintained,” the DGCA further said. The Directorate General of Civil Aviation (DGCA) is the regulatory body in the field of Civil Aviation, primarily dealing with safety issues. It is responsible for regulation of air transport services to/from/within India and for enforcement of civil air regulations, air safety, and airworthiness standards. The DGCA also coordinates all regulatory functions with the International Civil Aviation Organisation.

Reliance Industries Limited, Lucas TVS, and Waaree Energies are among the seven companies from whom the Ministry of Heavy Industries (MHI) has received bids in response to the global tender floated for manufacturing of 10 GWh Advanced Chemistry Cell (ACC) cells manufacturing under the Production Linked Incentives (PLI) ACC scheme. The scheme, which promotes manufacturing of technology-agnostic advanced chemistry cells in India, received a strong response from the industry as the bids received amount to 7 times the manufacturing capacity of 10 GWh to be awarded. The technical bids opened on Tuesday.

The bids for the PLI ACC scheme were announced on 24 January 2024, followed by the pre-bid meeting on 12 February 2024 after which the last date for receiving applications was set as 22 April 2024 on CPP portal. The other bidders are ACME Cleantech Solutions, Amara Raja Advanced Cell Technologies, Anvi Power Industries, and JSW Neo Energy for a cumulative capacity of 70 GWh.

In May 2021, the Cabinet had approved the technology-agnostic PLI scheme on ‘National Programme on Advanced Chemistry Cell (ACC) Battery Storage’ for achieving a manufacturing capacity of 50 gigawatt hours (GWh) of ACC with an outlay of Rs18,100 crore. The first round of the ACC PLI bidding was concluded in March 2022, and three beneficiary firms were allocated a total capacity of 30 GWh, and the program agreement with selected beneficiary firms was signed in July 2022.

India’s cement industry will see a tapering of demand growth to 6-7 per cent in fiscal 2025 after a third straight year of healthy demand growth at 11 per cent in fiscal 2024 to 441 million tonnes (MT). Cement volume growth recovered to a healthy 7-8 per cent on-year in the last quarter of fiscal 2024, on aggressive volume push, after growing 15 per cent on-year in the first half and logging a moderate slowdown in the third quarter due to regional hindrances. Production of cement, one of the economy’s eight infrastructure industries used to measure core sector growth, increased by 6.7 per cent on-year (provisional) in February 2024, as per Government data.

In fiscal 2025, CRISIL Research forecasts a 9-11 per cent correction in power and fuel cost led by softening of pet coke and coal prices. Freight expenditure is also expected to decline 1-3 per cent on the back of lower diesel prices, combined with players’ efforts to improve lead distances through aggressive expansions. According to Nomura, in 4QFY24F, the India cement industry saw a late recovery in demand from both trade and non-trade sectors resulting in strong volume growth. Analyst Jashandeep Singh Chad sees clinker utilisation levels to be 95 per cent for the top six cement manufacturers (in Nomura coverage universe) supported by pre-election demand.

Benign costs are, however, expected to prop up cement industry profitability on-year. Pan-India cement prices took a beating in the second half of the fiscal amid increasing competition and higher supply in the market. Nomura Ratings points out that in April 2024, the cement industry announced significant price hikes of around Rs 20-50/bag, across the country, breaking the five-month price moderation streak, implying improvement in cement spreads for 1QFY25F. Prices have plunged by Rs 40-45 per bag in the five months (November 2023 – March 2024) since the last price hike in October 2023. Signaling elevated competitive intensity in the market, the months of January and February did not see sustained price hikes this year unlike the trend of firms pricing in the early months of Q4 (and a price drop in March due to the year-end volume push). Aggressive volume push at the expense of pricing resulted in a 6 per cent sequential decline in cement prices to Rs 370-375 on average per 50 kg bag in the fourth quarter, with exit prices in March at Rs 360-362 per bag. Thus, at the overall level, cement prices have been subdued, declining 1.5 per cent to Rs 383-385 per bag on average in fiscal 2024 from an all-time high of Rs 391 per bag in fiscal 2023.

According to Sehul Bhatt, Director-Research, CRISIL Market Intelligence and Analytics, there is heightened competitive intensity due to the entry of new players, 40-42 MT of capacity additions, and benign cost pressures which pushed cement price correction in fiscal 2024 after four consecutive years of price rise at a CAGR of 4 per cent from fiscal 2020 to fiscal 2023. In fiscal 2025, continued capacity expansion, declining cost pressures, and moderating demand are expected to limit any uptick and keep prices range-bound at (1)-1 per cent.

Cement manufacturers like Ambuja Cements, the cement and building material company of the diversified Adani Portfolio has signed a definitive agreement to acquire My Home Group’s 1.5 MTPA cement grinding unit in Tuticorin, Tamil Nadu. The acquisition at Rs 413.75 crore through internal accruals will aid in enhancing the coastal footprint across southern markets of Tamil Nadu and Kerala. The total cement capacity of Adani Group stands at 78.9 MTPA.

On the profitability front, benign costs brought a sigh of relief to players in fiscal 2024 despite subdued realizations. On an annual basis, power and fuel costs, accounting for 30-35 per cent of total costs, declined 16-18 per cent in fiscal 2024, mainly due to the dip in Australian coal prices by 58 per cent and international pet coke prices by 38 per cent on-year. As a result, profitability is expected to recover in fiscal 2024, with a 300-350 bps expansion, reaching 17 per cent.

Raw material costs, however, are expected to remain range-bound in fiscal 2025, with better availability of fly ash and slag limiting any significant increase. However, auctioning of limestone mines at premium bids should limit a sharper decline in raw material prices. The waning input costs are expected to lead to a further 100-150 bps margin expansion in fiscal 2025 to 18-20 per cent despite tapering realizations. The pace of key construction projects, the impact of monsoon on agricultural profitability, and the volatility of crude oil and coal prices due to geopolitical uncertainties will bear watching as these can swing profitability.

In both cases, rates of expansion driven by increase in aggregate business activity resulted in the highest composite output index since June 2010 and the fastest in close to 14 years.

Indian private sector output expanded at a faster pace in April as economic growth across the sector continued to strengthen, buoyed by expansion in buoyant demand from domestic and external clients and a pick-up in sales growth. According to the HSBC Flash India PMI® data on Tuesday, positive demand trends fueled new business intakes and output, taking the headline HSBC Flash India Composite PMI Output Index – a seasonally adjusted index that measures the month-on-month change in the combined output of India’s manufacturing and service sectors – from 61.8 in March to 62.2 in April.

In both cases, rates of expansion driven by an increase in aggregate business activity resulted in the highest composite output index since June 2010 and the fastest in close to 14 years. The manufacturing industry led the latest upturn, as was the case in March, although softening growth at goods producers compared with accelerations at service providers. Sustained increases in new orders added pressure on the capacity of manufacturing firms and their services counterparts, which in turn underpinned recruitment. Jobs growth was notably stronger among the former.

The Reserve Bank of India had noted strong prospects of the manufacturing and services sectors as among factors in pushing the Central Bank for a vote to keep the policy repo rate unchanged at 6.50 per cent. Pranjul Bhandari, Chief India Economist at HSBC, notes that services growth accelerated further in April as new orders in both domestic and international markets rose. “Both composite input and output prices moderated in April, albeit remaining robust. Manufacturing margins improved in April as firms were able to pass on higher prices to customers due to strong demand conditions. In fact, manufacturing industries sharply increased their staffing levels and input buying activity,” says Bhandari, emphasizing improvement in overall future business outlook in April.

Growth in India remained broad-based across the manufacturing and service sectors. The former saw the sharper rate of increase, albeit one that was softer than in March. In the service economy, business activity rose to the greatest extent in three months. Private sector sales expanded for the 33rd successive month in April. In line with the recent trend, international sales positively contributed to total order books. In fact, at the composite level, new export orders rose at the fastest rate since the series started in September 2014. On this front, services companies noted the quicker rate of expansion. Anecdotal evidence pointed to stronger sales to clients in Africa, Asia, Australia, the Americas, Europe, and the Middle East.

Despite persistently robust increases in new business, pressures on capacity remained mild in April. Orders pending completion among private sector companies in India rose for the 28th month in a row, but at a slight pace that was weaker than that recorded in March. Manufacturers also substantially stepped up input buying, with growth climbing to a ten-month high. This supported a further increase in stocks of purchases, one that was the second-fastest since May 2023. Suppliers were reportedly able to accommodate for the upturn in buying levels, with delivery times improving to the greatest extent in ten months.

Yet, efforts to meet rising demand and clear backlogs supported further job creation at the start of the 2024/25 fiscal year. A slight increase in private sector employment masked notable divergences at the sector level. While service providers took on extra staff at a marginal pace that was softer than in March, goods producers raised workforces to the greatest extent in nearly a year-and-a-half.

The survey’s price measures showed slower rates of inflation for both aggregate input costs and output charges. Input cost inflation receded at both manufacturing companies and their services counterparts, with the latter noting the faster rise. Anecdotal evidence suggested that labour costs were the main factor behind rising expenses at service providers. At the composite level, the rate of increase was below its long-run average. Although prices charged for Indian goods and services rose to a lesser extent in April, the rate of inflation remained above its long-run average. According to survey participants, demand strength facilitated the passing on of rising expenses to clients. A stronger increase in the manufacturing industry contrasted with a slowdown at services firms.

Finally, the latest results showed a pick-up in business confidence during April. The composite Future Output Index rose from March’s four-month low and was above the series average (since April 2012). Panelists expect further improvements in demand and productivity over the course of the coming 12 months.

According to government sources, Apple, the manufacturer of iPhones, is anticipated to create employment opportunities for over 500,000 individuals in India through its vendors within the next three years. Presently, Apple’s vendors and suppliers provide jobs for 150,000 people in India. Tata Electronics, operating two plants for Apple, stands out as the largest contributor to job creation. “Apple’s recruitment efforts in India are gaining momentum. By conservative estimates, it is projected to hire half a million individuals in the next three years through its vendors and component suppliers,” stated a senior government official. When contacted, Apple declined to comment on the projection.

Apple has plans to scale up production in India by over five-fold to around $40 billion (about 3.32 lakh crore) in the next 4-5 years. According to market research firm Counterpoint Research, Apple led the India market with the highest revenue in 2023 for the first time, while Samsung topped the chart in terms of volume sales. The firm in its recent report said Apple surpassed the 10-million-unit mark in shipments and captured the top position in revenue in a calendar year for the first time.

Apple’s iPhone exports from India rose sharply to $12.1 billion in 2023-24 from $6.27 billion in 2022-23, representing a massive surge of nearly 100 per cent, according to trade intelligence platform The Trade Vision.