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THE ECONOMIC TIMES

WWW.ECONOMICTIMES.COM

BENNETT, COLEMAN & CO. LTD.

No Cricket Fatigue: IPL


TV Ratings Leap 30%

Amazon Atop Cloud,


Tech Cos Give Chase

COMPANIES4

GLOBAL BUSINESS10

Inside story
Farmers Death: AAP Begins
Damage Control with AK Apology
Two days after being at the receiving end of severe criticism for the death of Rajasthan farmer
Gajendra Singh during a rally, AAP began damage control exercise with a change in tone with
an unconditional apology by Arvind Kejriwal.
Pure Politics2
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Majesco Looking for More Buys in


Asia-Pacific Region, UK
Insurance technology software firm Majesco,
which will be listed on the New York Stock Exchange in July, said it is looking for more acquisitions and talent as it seeks to grow in markets
such as the UK and Asia-Pacific.
Companies 4
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Gates Foundation Offers Top


Dollars to Two MBA Interns
The Bill & Melinda Gates Foundation is paying
around `. 4.8 lakh each to two MBA students for a
10-week internship.
Companies 6

Fresh trouble may be brewing for Jignesh Shah,


his brother Manjay and others after an investigation was ordered them for diversion of
`. 900 crore funds from MCX.
Markets + Finance7

Poor performance across verticals takes toll in Q4; muted growth seen in FY16; co issues 1:1 bonus

Under Pressure

Anirban.Sen@timesgroup.com

Chennai: Infosys chief executive


Vishal Sikka announced his second
big acquisition and set an ambitious
target for five years later that would
require a massive overhaul of Indias second-largest software exporter after an underwhelming performance in the final quarter of
2014-15.
Infosys projected revenue growth
of 6.2-8.2% in 2015-16, below the industrys forecast of 12-14%, after
closing the previous year with revenue of $8.71 billion, an increase of
5.6%.
The company had predicted topline
would expand at 7-9%.
Sikka on Friday told investors on a
call that Infosys would be a $20-billion company by 2020, driven by improvements to productivity being
undertaken through automation.

Q4 15
Growth Growth
(Jan-Mar qtr) Q-o-Q Y-o-Y
Revenue

LAST

Nifty
Sensex

% CHANGE

8,305.25

-1.11

27,437.94

-1.07

BSE Midcap

10,435.64

-1.62

BSE Smallcap

11,008.62

-2.66

63.56

-0.38

Gold Std*

27,150.00

0.93

Silver (`/kg)

37,000.00

1.37

63.45

1.33

Re/US $

Brent ($)

Compiled by ETIG Database

*(`/10gm)

Advent-Temasek
Bags CG Biz for `. 2kcr
A consortium of PE
investors led by Advent
International along with
Temasek has scooped up the consumer business of Crompton Greaves
from Gautam Thapar and his family,
promoters of the diversified Avantha
Group, for `. 2,000 crore, report
Arijit Barman & Arun Kumar.4

ET MAGAZINE
ON SUNDAY

13,411

Net Income 3,097


OUTLOOK

-2.8

4.2

-4.7

3.5

ATTRITION

Announces a 1:1
share & ADS bonus
INVESTMENT

DIVIDEND

Raises dividend payout


to 50% of post-tax prots

ACQUISITION

Invests $2 m in air Agrees to buy San Francisquality monitoring co-based digital commerce
startup Airviz
rm Kallidus for $120 m

Smart
mar
artt

Money
M
on
ney

FOR
F

M&A war
chest to bring
in $1.5 billion
revenue

Revenue per
employee to rise
from $52,000
to $80,000

Startup investments through


$500million fund to help
make disruptive bets

Infosys CEO and MD Vishal Sikka seems to be well on his way to


achieve the goal to start reporting better growth than peers once
again by 2017, reports Ranjit Shinde of ET Intelligence Group.5

Sensex Dives to 3-month Low

Poor Infy numbers, MAT worries & earnings concerns spook D-St
Mumbai: Indian markets
slumped to their lowest in
nearly
three-and-a-half
months on Friday, dragged
down by Infosys after the software services exporter reported lower-than-expected

March quarter earnings. Persistent selling by foreign institutional investors (FIIs) amid
muted corporate results also
hurt investor sentiment.
The BSE Sensex dropped
1.07% to close at 27,437.94
points, below the crucial support level of 28,000. The NSE
Nifty declined 1.11% to end at

8,305.25 points.
We have to expect corrections periodically, and if we
are going to believe that markets will go up one way thats a
mistake, said S Naren, chief
investment officer at ICICI
Prudential AMC. I would say
that the current correction is
a healthy correction.

Infosys has
agreed to buy
Kallidus Inc, a
US-based digital and
mobile commerce
solutions provider, for
about $120 million in its
second significant acquisition in the past three
months. The acquisition
price includes a deferred
component and retention
bonuses, Indias secondlargest software company said on Friday.5

In The Drop Zone


Region

Index 2015-YTD
(% Gains)

India

Nifty

USA

Dow Jones 0.4

0.2

UK

FTSE

Brazil

iBovespa

7.9
11.4

Hong Kong Hang Seng 19.5


Germany

Dax

20.1

France

CAC 40

21.6

Russia

RTSI$

32.7

China

SSE Comp 35.8

RELATED REPORT7

SOOTHING FRAYED NERVES

Settle MAT Relief


Claims in a Month:
CBDT to Taxmen
Relief For Some

Dont demand tax


from FIIs coming via
countries such as
Mauritius, Singapore

STRONG SIGNAL

CBDT directive
sends strong
signal to
officials to not raise MAT
on FIIs coming via
countries with which India
has a double taxation
avoidance treaty

Our Bureau

New Delhi: In a bid to settle the


lingering row over Minimum
Alternate Tax (MAT), all
claims of relief under bilateral
tax treaties will have to be settled within a month of foreign
institutional investors (FIIs)
filing them.
The Central Board of Direct
Taxes (CBDT) directive issued
on Friday sends a strong signal
to tax officials that they
shouldnt raise MAT demands
on capital gains made by FIIs
coming through countries
such as Mauritius and Singapore, with which India has double taxation avoidance agreements (DTAAs).
It has therefore been decided
that in all cases of FIIs seeking
treaty benefits under the provisions of respective DTAAs, decision may be taken on such
claims within one month from
the date such claim is filed,
CBDT said.
The move is expected to further soothe the frayed nerves of
FIIs rattled by tax notices seeking the levy of MAT on capital
gains made in past years.

It also underlines the


point that provisions of
treaty will prevail over
domestic tax laws
WHO BENEFITS
Investors coming through
countries such as Mauritius and
Singapore with which India has
double taxation avoidance treaty
WHAT ABOUT OTHERS
MAT demands on them will hold &
issue settled eventually by courts

Dont Abandon
DTC: Panel to Govt
A parliamentary panel
has asked the Centre to
not abandon the Direct
Taxes Code saying this new law
needs to be enacted to replace
the Income-Tax Act, which was
very cumbersome and prone to
avoidable litigation.11

Xiaomi, the Chinese Phonemaker, Wants to be Indian


Co in talks with partners and two state govts to set up plant in the country; targets No. 1 spot by 2020
us in 2015 is India. We want to become an Indian company. So, we
want to build an R&D team, manufacture phones, set up data centre in
India and invest in ecosystem companies in India, Lei Jun, founder
and chief executive of Xiaomi, told
ET.
We have a designated team that
works on this project (local manufacturing). We would love to have
this happen as early as possible but
we need to make sure that quality is
not sacrificed, Lei Jun said. The
company is talking to its partners

Romit Guha & Gulveen Aulakh

New Delhi: Xiaomi, the worlds


fifth-largest smartphone maker,
wants to become an Indian company as it looks to invest in a startup,
set up an R&D centre, begin local
manufacturing and emerge as the
countrys No.1 handset player by
2020.
The most important market for

and two state governments for this


project, which could take up to two
years, initially as an assembling
unit.
The 45-year-old billionaire and serial entrepreneur,
who last visited InFULL
INTERVIEW dia 15 years ago, is on
a week-long trip to
PAGE 6
Mumbai and New
Delhi. Along with co-founder and
company president Bin Lin, he has
met top Indian business leaders,
startups, customers and retail partners. He also launched the Mi4i,

Get Ready to Unlock


the Power of Gold

are ready. It would be made public


in a week, a finance ministry official told ET. The government is
keen to make the scheme attractive
and a draft seeking comments from
the public will be released soon.
Under the terms of the proposed
scheme, the deposited precious
metals will be melted and the gold
in the jewellery would be credited
in the name of the depositor. The
depositor would earn interest on
the value of gold on the day of deposit.

LEI JUN

Founder & Chief Executive, Xiaomi

Xiaomis first phone to debut


outside China, on Thursday.
Counted among the worlds
richest people with a net
worth of $13.5 billion, Lei Jun
founded Xiaomi in 2010. Under
Lei Jun, who considers Steve
Jobs his idol, Xiaomi crafted a
business model which entailed
offering high-end smartphones,
which resembled Apples products, at affordable prices. They became an instant craze in China,
and have since become popular in India.

GOLD MONETISATION SCHEME IN THE WORKS

New Delhi: Its perhaps time to pull


out your gold and jewellery which
may have been lying idle in cupboards, and bank lockers, for years.
Besides gold, jewellery of all kinds
will fetch you returns if you participate in the governments Gold
Monetisation Scheme, the details
of which will be announced soon.
To make the scheme palatable it is
unlikely that the taxman will ask
you to pay wealth tax on jewellery
which you or your family may have
owned for generations, according
to finance ministry officials involved in preparing the scheme.
The finance ministry is giving the
final touches to the blueprint of an
ambitious plan intended to persuade Indians to part with at least a
fraction of their stupendous gold
hoard. Indians are among the
worlds largest consumers of gold,
importing at least $34.3 billion
worth of the precious metal for the
fiscal year ended March 31, 2015.
The broad contours of the plan

Moves
Retirees
R
ti

employees

Infosys on Track to Better Health

Deepshikha.Sikarwar
@timesgroup.com

ET WEALTH
ON MONDAY

Co to
have
around

250,000

FY16 revenue to grow 10-12% 13.4%, lower


in constant currency terms
than TCS 14.9%
BONUS

Infy Buys
US Tech Co
for $120 m

VISHAL SIKKAS $20 B


TARGET BY YEAR 2020

AMOUNT IN ` CRORE

Revenue from N America Declines5

Our Bureau

Market Tracker

ON Saturday

Sluggish Infosys Aims to


Become $20b co by 2020

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FIR Likely Against Jignesh Shah,


Others in MCX Fund Diversion Case

SATURDAY, 25 APRIL 2015

BENGALURU | 12 PAGES | .` 10 ONLY

EPFO Can Use 5%


of Incremental
Income in ETFs
The labour ministry
has opened the
floodgates for investing over `. 7,500
crore of retirement savings of
workers in the capital markets for
the first time. It has notified a new
investment pattern that allows
the Employees Provident Fund
Organisation (EPFO) to deploy 5%
of its incremental income in exchange-traded funds or ETFs
from the current fiscal.The limit
of investment in ETFs, starting
from 1% with effect from April 1
and reaching 5% by the end of the
financial year, is the lower end of
the 5-15% investment in equities
recommended by the finance
ministry. We have notified the
new investment pattern for EPFO, labour secretary Shankar
Agarwal said on Friday.11

We want to become an
Indian company. So, we
want to build an R&D
team, manufacture
phones, set up data
centre in India & invest
in ecosystem cos

Theres a Spy Behind Your


Gadget Screen Tracking Data
More people are
becoming aware of
the risks that come
with online habits

E-Spies
Each data point of Net users lives are
collected by companies & tech startups
COMMONLY
COLLECTED INFO

IP address
Evelyn Fok
& Krithika Krishnamurthy

Bengaluru: Thejesh GN, a


Bangalore-based technologist, does not have a Facebook app on his phone, often
browses on incognito mode
and has installed a tool that
detects and blocks spy ads
and trackers. All this is to escape from the pervasive ads
that have now begun to invade his online presence.
But Thejesh knows its of
little use. Given the proliferation of ecommerce companies in India, the barrage of
ads are unlikely to stop.
Its an everyday fight.
There is no way to get rid of
all these ads, said Thejesh,
cofounder of data science

Browser type

WHERE DOES THIS DATA GO?

Some data sold


to brands via ad
networks

Pages viewed PRIVACY BREACHDate and


ES CAN GIVE WAY
time of use
TO CORPORATE
ESPIONAGE

community Datameet.
Thejesh represents a growing population of Internet
users who are becoming
aware of the risks that come
with their online habits - specifically, having each data
point of their everyday lives
collected by companies and
tech startups. This includes
an individuals IP address,
browser type, pages viewed,
and the date and time of use.
On mobile, the data collected
could be more elaborate and
accurate including a users

Others used by companies


to streamline ads shown to
specific users
LACK OF LAWS

In India, there are no rules


or guidelines regulating
online behavioural ads

location, device type and contact list.


Where does all this data go?
Some are sold to brands via
ad networks, and others are
used by companies to streamline the ads shown to specific
users. In India there are no
rules explicitly regulating
online behavioural advertising, and thus it is not clear
what practices different
companies and internet service providers undertake.
No Clarity on Info Used7

Brick-and-Mortar Retail Now Rests on a Shaky Foundation


Number of modern food & grocery stores dip on rising rentals, power costs & online rivals

A Cartful of Woes

Food & Grocery Store Count Of Organised Retailers

44%
YES

52%
NO

4%

498 500
325

Should the government concede to a


demand for farm loan waiver?

128 123

206 206

CANT SAY

TODAYS QUESTION

Will a below average monsoon hurt


pick-up in economic growth?
www.economictimes.com

Ratna Bhushan & Rasul Bailay

March 2015

616
290

718

March 2014

Reliance Future Spencers Aditya Bharti


Birla
Retail Group* Retail
Retail
Retail

RETAILERS HAVE MOVED


AWAY FROM FOOD
AND GROCERY-HEAVY
STORES TO HIGHMARGIN FASHION &
HOME PRODUCTS

*Does not include around 140 Nilgiris stores acquired last year

SOURCE: Companies

New Delhi: Western-style food and grocery


stores have shrunk in India, with outlets
shutting down and expansion virtually put
on hold. Net closures last year were estimated at about 180 stores amid skyrocketing
rental, power and manpower costs and competition from online retailers, according to
the internal data of a leading consumer
goods multinational.
What has been happening is e-commerce
firms like Flipkart and Amazon are giving
stiff competition to organised retail trade

on big days such as August 15, January 26,


or long holiday weekends. The incentive to
go out and shop for grocery on such big discount days is being capitalised by e-commerce sites selling on discounts across categories, which is impacting organised
trade, said Sidharth Singh, executive vicepresident of sales at GlaxoSmithKline Consumer Healthcare, the maker of Horlicks
milk drink and Sensodyne toothpaste.
Even though online retailers sell a negligible percentage of food and grocery items,
they aggressively discount apparel, home
products and other general merchandise,
which bring down the margins for brick-

and-mortar stores, hurting their overall


profitability.
The chief executive of another large consumer multinational company said its data
showed that organised retailers in India
closed hundreds of outlets last year, although he did not have figures for how
many were added or relocated during that
period.
Our data says we have stopped supplying
to about 450 modern stores -- big and small
in both metros and smaller cities -- in 2014
on account of their closure, the person
said, asking not to be identified because of
the sensitivity of the matter.