Business News at 10:00 am on 2nd July, 2024

Let’s begin with the major update, Startups seem to be showing results on the profitability front in the last two years, with venture capitalists and private equity firms tightening their purse strings and stressing on profit first rather than just growth. In FY24, three unicorns turned profitable: Travel tech startup Oyo, Honasa Consumer’s Mamaearth, and food tech major Zomato. Also turning profitable were Lendingkart and Mensa Brands’ MyFitness (the latter was Ebitda profitable). In comparison, only two unicorns — Chargebee and Rivigo — had turned profitable in FY22, and only one startup, Digit Insurance, in FY23, according to Tracxn data. Besides, eight other startups have reported profits in either the third or fourth quarter of FY24, and one in Q1FY25.

Moving on, To ensure a level-playing field for big and smaller players in the broking industry, the Securities and Exchange Board of India (Sebi) has said charges levied by market infrastructure institutions (MIIs) on members should be uniform and equal irrespective of the volume generated. The move will likely impact large broking firms and discount brokers, who effectively end up paying lower charges to MIIs due to the high volumes they generate, the CEO of a broking house said. It is also aimed at curbing the surge in derivatives trading as there will be no incremental benefit for members for generating high volumes. Futures & Options trades contribute to a significant chunk of the overall market trade.

In other news, Gross Goods and Services Tax (GST) collections came in at Rs 1.74 trillion in June (May transactions), up 8% on year, according to official sources. This was against Rs 1.73 trillion collected in the previous month. The year-on-year growth rate during June was the slowest in around three years. In May, the growth rate was 10%, the slowest in 34 months. The slowdown in GST revenue growth could be attributed to slower economic activity during the election period, and a plateauing of the collections after reporting a robust trend for a long period. During June, the government settled Rs 39,586 crore to the Central GST from Integrated GST collections, and Rs 33,548 crore to State GST, the source said.

Meanwhile, Tax relief on deposits, home loans and a standalone refinancing body for non-banking financial companies (NBFCs) are among the top recommendations that bankers have made to the Centre ahead of the upcoming Budget for FY25. SBI chairman Dinesh Khara, for instance, has pitched for a tax relief on the income account holders earn from interest. Quote, If at all some relief could be given regarding tax on the interest earnings, it will be an incentive to depositors. Eventually, the banking sector uses deposits mobilised for the capital formation in India, Unquote, he told PTI in an interview in June. Under the current taxation laws, banks deduct tax on interest income earned on deposits when it exceeds Rs 40,000 a year.

Up next, The number of transactions on the unified payments interface (UPI) platform rose 49% year-on-year (y-o-y) to 13.9 billion in June, latest data from the National Payments Corporation of India (NPCI) showed. The transaction volume in June was marginally lower than 14 billion in May due to the lesser number of days in June. The transaction value rose 36% y-o-y to Rs 20.1 trillion. The value of UPI transactions had risen 37% y-o-y to Rs 20.4 trillion in May. According to data from the NPCI, the average daily transaction count was 463 million in Jun and the average daily amount was Rs 66,903 crore. In terms of other key metrics, monthly volumes on Aadhaar-enabled payment systems rose 4% y-o-y to 100 million.

Moving ahead, Genpact and Microsoft have collaborated to develop over 120 unique artificial intelligence use cases. This partnership aims to leverage AI to streamline and enhance finance functions across various industries. Both the companies announced their partnership, aimed at driving modern finance transformation across enterprises focusing on leveraging data, technology, and AI to fuel innovation for finance organisations globally, earlier this year. Vidya Rao, Genpact’s chief technology and transformation officer, highlighted several key AI-driven improvements. One of the critical use cases Rao highlighted was the transformation of vendor management processes, which was traditionally manual and labour-intensive. Additionally, Genpact has transformed its customer connection process through AI-powered analytics and automation, streamlining the entire invoice and payment tracking system.

Lately, let’s take a look at the key stocks for today. GIFT Nifty indicated that Indian equity indices BSE Sensex and NSE Nifty 50 may see a gap up opening on Tuesday. GIFT Nifty traded higher as the index was up 40.50 points or 0.17% at 24,245.50 indicating a higher start for domestic indices NSE Nifty 50 and BSE Sensex on Tuesday. Previously, on Monday, the NSE Nifty 50 rose 131 points or 0.55% to settle at 24,142, while the BSE Sensex jumped 443 points or 0.56% to close at 79,476. Here’s a look at the key stocks to watch in trade – Coal India, OMCs, Paytm, Patanjali Foods, NMDC.