Kitchen appliances maker Kutchina pumps in Rs 40 crore to aid pan-India growth Plan

Source: Economic Times, 03 January 2022

Kutchina has embarked on a pan-India expansion plan to position itself as one of the top kitchen solution brands in the country, and planned to invest Rs 40 crore to augment manufacturing capability to overcome COVID-induced challenges, a company official said on Sunday.

It enjoys around 66 per cent market share in chimneys in eastern India, and the modular kitchen segment is also growing fast in the region, he said. “We now have limited presence in western and northern parts of the country. We have planned to become a top national brand in the kitchen space over the next 2-3 years,” Kutchina managing director Namit Bajoria told PTI. 

The Kolkata-headquartered company is planning to strengthen its presence in North and West India with chimneys and modular kitchens, and after consolidating in these regions, it would focus on southern states, he said. “We are in the process of executing an expansion project to ramp up our manufacturing capability by four to five times with a capital expenditure of over Rs 40 crore. We have earmarked a total of Rs 50 crore to enhance our capabilities and become a national brand,” Bajoria said. Video Player is loading. 

PlayUnmute Fullscreen VDO.AI A new integrated production facility is coming up in North 24 Parganas district in West Bengal with the latest imported plant machinery, he said. Apart from chimneys, hobs and modular kitchens, the company also sells small kitchen appliances such mixer grinder, electric kettle, hand blender and OTG and RO water filters. The company had mostly followed an outsourcing model since its launch in 2003 but the COVID-19 pandemic has forced the management to have its own manufacturing facility to protect from supply-chain disruptions, he said. “One cannot stop operations during disruptions. We decided to have our own strong manufacturing unit to address supply chain issues and costs,” the official said. 

The kitchen appliances maker, which had introduced the first auto-clean chimneys in the country, will also bring innovation in the new year with storage ultraviolet
(UV) water filters that would not require continuous water supply. Currently, UV water filters require constant piped water supply.

The company achieved growth in 2021, amid the COVID-induced disruptions and hopes to end the current fiscal with Rs 300 crore revenue. Bajoria also stated that the company is expanding the footprint of Kutchina Galleries from 75 to 100 by April with the majority of them being set up in new locations.

JSW Group announces EV Policy for employees, incentive of Rs 3 lakhs to buy EV vehicles

Source: Economic Times, 27 December 2021

Sajjan Jindal-led JSW Group has launched an electric vehicle (EV) policy which will facilitate up to Rs 3 Lakhs incentive for employees to purchase electric vehicles- four-wheelers, as well as two-wheelers. This Policy aims to promote the adoption of electric vehicles across the Group.

”The goal is to build ambition among corporate and government bodies to support India’s transition to net-zero by 2070,” group chairman, Sajjan Jindal said in a media statement on Monday.

Apart from financial incentives, free-of-cost dedicated charging stations and green zones (parking slots) for electric vehicles will be provided at all JSW offices and plant locations for employees, the statement said.

“The transport sector in India is currently the third-largest emitter of CO2. As electric vehicles are more efficient than traditional IC engine vehicles, the JSW EV policy, effective January 2022, will set a benchmark for others to follow. EVs are not only environmentally-friendly but also cost-effective,” the company’s chief human resources officer, Dilip Pattanayak said.

JSW Steel Ltd has adopted a specific climate change policy and set a CO2 emission reduction target of 42% reduction over the base year of 2005 by 2030 (to a level 1.95tCO2/tcs). In India, JSW Steel is operating a Carbon Capture and Utilization (CCU) of 100TPD capacity where the captured and refined CO2 is used in the beverage industry.

JSW Group has been incorporating sustainability into its core operations and decision-making practices, along with adopting the Best Available Technologies (BAT) to improve climate impact performance.

“JSW Group’s new EV Policy is a unique initiative leading to increased adoption of EVs in India and enabling access to green mobility,” Jindal said.

Indian economy recovering well, but Omicron poses a risk: RBI bulletin

Source: Business Standards, 16 December 2021

The Indian economy “continues to forge ahead, emerging out of shackles of pandemic,” but the rise of the Omicron variant has emerged as the biggest risk factor, said the state of the economy report released with the December bulletin of the Reserve Bank of India (RBI) on Wednesday.

The Indian economy bounced back strongly in the second quarter, as the gross domestic product (GDP) surpassed its pre-pandemic levels, and inflation broadly remained under the 6 per cent range, the upper band of the tolerance range of the RBI. The RBI’s medium-term target is to keep retail inflation at 4 per cent. In November, the retail inflation came at 4.91 per cent, but wholesale price index (WPI), which it no longer targets, came at a 12 year high of 14.23 per cent.

“A host of incoming high frequency indicators are looking upbeat and consumer confidence is gradually returning. Aggregate demand conditions point to sustained recovery, albeit, with some signs of sequential moderation,” the report said.

Farm sector is strong, while the “manufacturing and services record strong improvement on strengthening demand conditions and surge in new business,” the report said, adding high frequency indicators are also looking upbeat. The daily infections have tapered and the inoculation rate has gathered steam.

Consumer confidence is gradually returning, and the “overall outlook remains optimistic on the general economic situation, the employment scenario and household income.” RBI’s recent surveys show for the year ahead, consumers are buoyed by sentiments on income and employment.

Revenue collections under the goods and services tax (GST) in November was the second highest ever although e-way bill issuances moderated somewhat pointing to moderation in GST collections in the month ahead. On the other hand, toll collections remained resilient in November. Coal stock in power plants has risen to nine days, assuaging concerns on supply shortages.

While both international and domestic cargo freight normalised in November, and passenger traffic has been gathering steam during the festive season, “new travel guidelines coming in the wake of Omicron might derail the nascent growth,” the report said.

Expenditure by the centre and 18 states together during November-March 2021-22 is expected to grow by 27 per cent, assuming states meet their budgeted targets. Similarly, capital expenditure is expected to grow by 54 per cent in this period.

“The higher revenue expenditure growth, a proxy of government final consumption expenditure, is expected to support economic recovery, while robust capex could crowd in private investment and improve medium-term growth prospects,” the RBI noted.

“Going forward, the emergence of the Omicron strain has heightened the uncertainty in the global macroeconomic environment, accelerating risks to global trade with resumption of travel restrictions/ quarantine rules at major ports and airports,” the report said. This looming threat “calls for observing greater caution and readiness to respond swiftly.”

According to the RBI, the ongoing supply-side constraints are likely to keep input prices and freight rates at elevated levels and could act as a “drag on overall exports.”

India Inc may stick to hybrid work model in new year

Source: Economic Times, 15 December 2021

A large section of India Inc across sectors is likely to follow hybrid working model in the new year as the pandemic enters its third year.

Executives from companies including Maruti Suzuki, Saint-Gobain, ITC, Dabur, Wipro, Infosys, HCL Technologies, Uber, Amazon, Flipkart and KPMG told ET that a mix of remote and on-site work will continue at least for the 􀀀rst few months of 2022.

With the impact of the newly found Covid-19 variant Omicron not known, some companies like Kotak Mahindra Bank and Nestle India have either slowed down or completely stopped business travel and team gatherings. 

We expect to operate in a hybrid mode for most of the coming year,” said Richard Lobo, head, HR, at Infosys. “We will have a mix of people – some who will work out of the o􀀁ice while others work partially or fully remote.”

Spokespersons of other tech 􀀀rms like Uber, Wipro and HCL con􀀀rmed they will continue the hybrid working model.

Maruti plants are operational, but most of its o􀀁ice employees are working remotely with a small percentage of people coming to o􀀁ice following a roster system, said Rajesh Uppal, chief information o􀀁icer and member of executive board (HR, IT, digital enterprise, education & training) at the country’s top carmaker. 

“With the new Omicron’s threat, we have further strengthened our internal communications, and advisories are being shared with employees to follow Covid-19 appropriate behaviour at all times,” Uppal said. 
Nestle India has put “any planned relaxations in consideration with respect to team gatherings and travel on hold”, according to its spokesperson.

Kotak Mahindra Bank is also not undertaking any business travel unless essential and stopping all physical events, said its group CHRO Sukhjit Pasricha. 

Most companies plan to wait up to February to renew the e􀀁orts to return to o􀀁ice.

“For many companies, the plan to return to work and push people to come to o􀀁ice has slowed down,” Roopank Chaudhary, partner at Aon’s human capital business, told ET. 

Ecommerce major Amazon India, which directly employs more than 100,000 people in the country, said it is monitoring the situation closely. “We anticipate (our) directors sharing more with teams in January,” a company spokesperson said.

Its rival Flipkart has created a hybrid model for all corporate employees for the next few months. “This combines campus and remote work options,” said Krishna Raghavan, chief people o􀀁icer at Flipkart. 

Tobacco, hotels and consumer goods conglomerate ITC’s corporate human resources head Amitav Mukherji and FMCG company Dabur India executive director-HR Biplab Baksi, too, said they plan to continue with hybrid working model in their o􀀁ices. 

Professional services 􀀀rm KPMG has been following a remote working model since the start of the Covid-19 outbreak in March 2020. “Starting at some point in early 2022, we look forward to seeing our people in our new 􀀂exible and hybrid model of working,” said Sunit Sinha, head – people, performance and culture at KPMG (India). 

Partners and directors are likely to come to o􀀁ice twice a week from January, he told ET. 

B Santhanam, CEO Asia Paci􀀀c at Saint-Gobain, said, “Businesses and functions have the autonomy to decide WIO (work in o􀀁ice) or 􀀀FH (work from home)… I believe hybrid will continue beyond Covid.”

More efforts needed to popularise Udyam

Source: Financial Express, 03 December 2021

The Centre announced two important steps over the last year to support MSMEs disproportionately affected by the Covid-19 pandemic. First, it introduced a new composite criterion based on higher investment and turnover thresholds for classifying MSMEs so that they could continue reaping benefits provisioned under the MSMED Act, 2006. Second, the government introduced a new, fully-digital registration system called the Udyam to facilitate the ease of doing business for MSMEs.

The Udyam initiative is particularly noteworthy as it represents a significant step towards creating a level-playing field for MSMEs through digital inclusion.

Benefits for MSMEs

First, Udyam allows MSMEs to auto-register in the Government e-Marketplace (GeM), which facilitates online procurement of common-use goods and services by various government departments, organisations and PSUs. Registration provides MSMEs with an equal opportunity to access and sell to the B2G market segment. Ongoing efforts to integrate GeM with the Indian Railways E-Procurement System (IREPS), India Post and the Ministry of Panchayati Raj will further expand business opportunities for registered MSMEs.

Second, MSMEs registered with Udyam can also participate as sellers on one of the three Trade Receivables Discounting System (TReDS)—Receivables Exchange of India (RXIL), M1Xchange and Invoicemart. Since TReDS facilitates financing of trade receivables of MSMEs from corporate buyers through multiple financiers, such a factoring arrangement can help reduce the working capital demands of MSMEs.

Third, despite some compensatory provisions under the MSMED Act, 2006, the issue of delayed payments remains a critical challenge for MSMEs. In this regard, over 90,000 complaints, involving a sum of around Rs 24,300 crore have been filed by MSMEs over the past four years. Udyam-registered MSMEs can take advantage of the Samaadhan portal, a delayed payment redressal platform, to resolve their outstanding issues in a more streamlined and time-bound manner. The Micro and Small Enterprise Facilitation Council (MSEFC) has the power to direct the buyer unit to pay a monthly compound interest of three times the bank rate for any payment default beyond 45 days.

Fourth, Udyam registration also simplifies availing of financial assistance from central and state government financial institutions. Registered entities can get easier access to benefits, including guarantees, work execution loans, bill discounting, government promissory note discounting, and equipment finance for amounts up to Rs 50 crore. Financial institutions are often reluctant to lend to MSMEs because they lack access to information regarding their creditworthiness. The Udyamportal, with its interlinking to GST and TReDS platforms, can provide the relevant data to carry due diligence exercises by the financial institutions.

Poor response

Despite having several advantages, the Udyam initiative has not received an encouraging response so far. Of a total of 6.33 crore MSMEs in India, the number of enterprises registered for Udyam since its launch is only 57.1 lakh, less than the number of registered enterprises under the Udyog Aadhar Scheme (little over 1 crore). In July 2021, RBI allowed wholesale and retail traders, estimated to number around 2.5 crore, to get classified as MSME and register on the Udyam portal. Seen in this light, the registration numbers appear even more dismal.

A plausible reason could be the confusion created through different circulars concerning the need for GST Identification Number (GSTIN) to register on the Udyam portal. Many MSMEs have an annual turnover of less than Rs 40 lakh, the threshold limit for GSTIN exemption under the GST Act, 2017. While the government has now clarified that GSTIN is no longer required for registration, the same is not communicated unambiguously on the official website of Udyam. Additionally, the extension of validity for using the Udyog Aadhar Memorandum (UAM) until December 31, 2021, for claiming existing benefits could have put enterprises in a wait-and-watch mode.

Policy imperatives

That said, the key underlying issue leading to poor response might be the fear of excessive scrutiny of business operations by government agencies and a related rise in compliance costs for the enterprises. The government should allay such concerns by creating robust monitoring systems that can arrest undue harassment of small traders on account of unauthorised access and abuse of user information. The official advertorials are conspicuously silent on data protection questions.

The government should also contemplate creating additional incentives for the onboarding process. For example, Udyam registration can be tied to availing of special tax incentives for early-bird registrations, or used as an eligibility criterion for interest subvention schemes, or for availing benefits of schemes launched by different ministries of the government, and/or those offered by financial institutions for standalone or bundled products and services.

Needless to say, the government must create greater awareness about the process and benefits of Udyam registration than is the case currently. No dedicated official app for Udyam registration exists today. Given the ubiquitous usage of mobile apps for various activities, an app-based registration process (instead of a web-only based process) can simplify and improve the onboarding system.

The government must become more sensitive to the apprehensions of the MSMEs and act, even while it laudably intends to mainstream the enterprises within the formal systems.

Need credible policy to attract investments that are exiting China to boost MSME manufacturing: Rane

Source: Economic Times, 03 December 2021

NEW DELHI: MSME Minister Narayan Rane on Tuesday met Finance Minister Nirmala Sitharaman and flagged the need for a credible policy for attracting foreign investments that are exiting China, to enhance the manufacturing capacity of micro, small and medium enterprises.

Rane held a detailed discussion regarding the enhancement of budget and continuation of flagship schemes of the ministry, according to an official statement.

He also raised the issue of credit requirements of COVID-19-hit MSME units. “He highlighted the need for a credible policy for attracting the foreign investment exiting China to enhance the manufacturing capacity of the MSMEs,” it said.

Rane shared with the finance minister the feedback of the MSME entrepreneurs regarding the “apathy and indifference” of the banks towards providing credit to the sector.

“The finance minister assured her support to enhance the budget of MSME for the growth of the sector. She informed that banks will be asked to be sensitive to the needs of MSMEs, and district-level interactions will be held between the bankers and the MSME borrowers,” it added.

FMCG consumption slips in July-Sep but industry logs price-led growth of 13 pc: Report

Source: Economic Times, 30 November 2021

India’s FMCG industry saw a decline in volume in September quarter this year, though it registered a value-led growth of 12.6 per cent, according to a report by data analytics firm Nielsen. While the metro market saw an upswing, rural markets slowed down due to consumption decline, it added. Earlier, rural was ahead of urban in terms of growth, after quickly recovering from the first wave of the pandemic.

Besides, macro-economic factors such as high commodity prices continued to impact consumption growth during the quarter, added the FMCG Snapshot released by NielsenIQ’s Retail Intelligence team.

“Overall, the Indian FMCG industry witnessed a significant price-led growth in the quarter on account of increasing commodity & raw material prices, and high fuel prices leading to higher transportation costs. This resulted in double-digit nominal growth, but a drop in consumption (volume) growth for the industry,” it said.

The price-led growth is largely driven by the food basket, which contributes 59 per cent to the FMCG industry.

“This was seen especially in staple foods like cooking mediums (edible oils), habit-forming foods like hot beverages such as tea and impulse foods like salty snacks and confectionery. Volume growth is driven by packaged rice, breakfast cereals, butter margarines, and chocolates,” it added.

Moreover, small players were impacted the most while large players consolidated, the report said.

Of the total value growth of the FCMG industry in September quarter, as compared to a year ago, 76 per cent contribution came from large manufacturers, while small players had just 2 per cent, the rest coming from mid-size players, it added.

Moreover, brick-and-mortar was back in focus, as modern trade stores grew 17 per cent in the quarter, registering double-digit growth as compared to the year-ago period.

The e-commerce channel growth remained steady during the quarter on account of the base effect, given the high growth of foods in e-commerce post the first wave of COVID-19 in the country.

According to the report, urban markets led by metros including Kolkata, Hyderabad, Mumbai and Pune led this growth.

“This quarter, food products like cooking mediums and impulse foods, while within Non-foods – personal care and fabric care are contributing to the uptick in metros,” it said.

However, rural markets witnessed a decline of 2.9 per cent in volume due to slowdown in consumption despite a 9.4 per cent value growth.

The segments that slipped were cooking medium, packaged grocery, hot beverages, among others, the Nielsen report said.

NielsenIQ South Asia Lead Diptanshu Ray said the quarter saw consumer purchases inching back to pre-COVID levels.

“However, the rural growth slipped on volume/ consumption”, he said add in though there continues to be pressure on the consumer, this is offset by the encouraging uptick seen in modern trade in urban markets.

In July-September 2021, popular price segments, across the FMCG industry saw an uptick, contributing 59 per cent in comparison to 56 per cent in January-March 2020.

Mass price segments saw a drop in value contribution — 17 per cent in July-September 2021 in comparison to 19 per cent in January-March 2020.

Expo 2020 Dubai: India invites global investors to join its energy transition journey

Source: Financial Express, 21 November 2021

India has invited global companies to invest in its energy transition and work with it to achieve its vision to expand the green footprint by more than doubling the share of natural gas in the country’s energy basket. Addressing investors virtually during a roadshow on Saturday ahead of the 11th round of bidding for city gas distribution (CGD), Union Minister of Petroleum and Natural Gas Hardeep Singh Puri said that the demand for natural gas within India has seen an upward tick from the past.

“The growth of the CGD industry showcases natural gas as a responsible alternative to its more polluting fossil fuel counterparts,” he told investors gathered at the Indian pavilion at EXPO2020 Dubai. “When the NDA government took office in 2014, only 34 geographical areas covering 9 per cent population and 2.7 per cent of India’s geographical area were covered by CGD networks and on the completion of the 11th round, 96 per cent of the country’s population and 86 per cent of its geographic area would be covered under CGD network. The expected investment because of the concluded CGD bidding rounds is nearing a total of rupees 1.2 lakh crore,” he said.

Tarun Kapoor, Secretary, Petroleum and Natural Gas, invited the private sector to invest in the oil and gas sector as there are huge business opportunities. “We want the private sector to come in a big way to join the Indian oil and gas sector. So far, public sector is leading, playing probably the very major role, but now, we want more and more companies from the private sector to join them,” he said during a keynote address. “While some of the companies have already invested in city gas distribution, we want some new companies also to come in, as the business opportunity is huge. And we want the distribution networks to come up very fast in India,” Kapoor said.

Talking about the upstream industry, he said, “India has not yet fully explored its oil and gas reserves, and as we move along and we start exploring more and more area, we will certainly have more discoveries.” The latest bidding round will offer 65 geographical areas spread over 19 states and one Union Territory, which would cover around 25 per cent of India’s population. “Natural gas is the future, and it will be the most important component of India’s energy bouquet to realise our vision of net-zero by 2070,” said Shrikant Madhav Vaidya, Chairman, Indian Oil Corporation Ltd (IOCL).

Manoj Jain, Chairman & Managing Director, Gas Authority of India Ltd. (GAIL), said, “GAIL has been a pioneer in CGD in India, and we are currently operating in 62 geographical areas. We are committed to covering the entire India with gas pipelines, including J&K, soon.” S C L Das, Director General, Directorate General of Hydrocarbons; Gajendra Singh, Member, PNGRB; Suresh Manglani, CEO, Adani Gas Ltd, along with various CGD players from the public and private sector, also attended the bidding. India is currently the third-largest primary energy consumer after China, and the USA, and it is one of the fastest-growing energy consumers across the world. The country aims to enhance the share of natural gas in its energy basket from 7.6 per cent to 15 per cent by 2030.

Cross-border insolvency cases: Government will soon put out for consultation the draft legal framework

Source: Economic Times, 19 November 2021

The government will soon put out for consultation the draft legal framework for cross-border insolvency cases.

The Ministry of Corporate Affairs (MCA) and the Insolvency and Bankruptcy Board of India (IBBI) met on Thursday to finalise the contour of the framework to settle bankruptcy cases of companies that have business or operations in more than one country. “A final draft paper to be floated by the end of this month, outlining the legal framework for the cross-border insolvency,” said a government official in the know.

Based on the feedback, the government will try and move a Bill to amend the Insolvency and Bankruptcy Code (IBC) in the upcoming winter session of Parliament.

The amended Code would empower insolvency professionals (IPs) and creditors to access assets outside India of corporate debtors, maximising the value for all stakeholders. Similarly, foreign creditors to an Indian entity become party to bankruptcy proceedings if the borrower goes bankrupt.

Sources privy to the meeting said there were discussions on the details of adopting a law based on the UNCITRAL Model Law on Cross-border Insolvency, 1997 and how it would be beneficial to Indian creditors.

No income tax NOC/NDC required for voluntary liquidations, says IBBI

Source: Business Standards, 18 November 2021

In a move that will ease some compliance burden, insolvency professionals would not be required to obtain any non-objection or no dues certificate from the Income Tax Department while handling the voluntary liquidation process, the Insolvency and Bankruptcy Board of India (IBBI) has clarified.

“The process of applying and obtaining of such NOC/NDC from the Income Tax Department consumes substantial time and thus militates against the express provisions of the Code, and also defeats the objective of time-bound completion of process under the Code,” IBBI said.

Section 178 of the Income-tax Act, 1961 obligates a liquidator to fulfil certain income tax related requirements. The section explicitly also states that its provisions “shall have effect notwithstanding anything to the contrary contained in any other law for the time being in force” except the provisions of the Code.

IBBI clarified that liquidators had been seeking these certificates even though the Code or the Regulations did not ask for such a requirement.

“This clarification is very important as many of the voluntary liquidation matters keep dragging on only because of the delay or non-availability of No Objection or No Dues letter from income tax. Liquidators fear that in case any claim arises after the dissolution, it will be on the head of the liquidators. This clarification would fast track the process substantially,” said Manoj Kumar, partner, Corporate Professionals.

Industry experts said that many liquidators had been raising these queries to the IBBI. “The principles that the Code enjoys supremacy and that the Code intends to achieve the objective of being time-bound are reiterated with the amendment. This would operationally ease the process of voluntary liquidation,” said Veena Sivaramakrishnan, partner, Shardul Amarchand Mangaldas & Co.

Regulation 14 of the IBBI voluntary liquidation process mandates the liquidator to make the public announcement within five days of his appointment, calling for submission of claims by stakeholders within thirty days from the liquidation commencement date.

It also obligates all the financial creditors, operational creditors including government, and other stakeholders to submit their claims within the specified period. If the claims are not submitted in time, the corporate entity may get dissolved without dealing with such claims.

At the end of June 30, 2021, 968 companies had initiated voluntary liquidation. Final reports in 438 cases had been submitted and nine processes had been withdrawn, according to the IBBI’s newsletter.

Most of these companies were small entities. Over 530 of them had a paid up capital of less than Rs 1 crore and only about a hundred of them had a paid up capital of more than Rs 5 crore.