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Good morning. This has been a wierd week, news-wise. Very similar to the rains in Delhi there appears to be lots brewing past the horizon, and a few storms impending, however little or no to point out for it in the intervening time. Quarterly GDP numbers shall be out later right now. Ship me your predictions earlier than the announcement.
In right now’s publication: India is attempting to guard agricultural merchandise and dairy from US imports. However first, can Bhavish Aggarwal save Ola Electrical?
Ola’s scooters skid
Ola Electrical, the two-wheeler EV producer that was as soon as a sort of poster youngster for younger India’s entrepreneurial promise, continues its downward slide. Legacy scooter producers TVS Motor and Bajaj Auto now promote extra electrical two-wheelers. Ola, which commanded almost half the market in Could final yr, can now declare solely 20 per cent. Its outcomes for the most recent quarter introduced on Thursday confirmed revenues slid 62 per cent yr on yr and losses mounted to Rs8.7bn.
The corporate, which went public in August 2024, is plagued with issues. The IPO raised Rs60bn ($700mn) for development and growth, however that doesn’t appear ample. Earlier this month, the board authorised elevating an extra Rs15bn by means of debt devices akin to non-convertible debentures with the intention to assist enterprise operations. Since its debut, the inventory has misplaced 30 per cent, closing at Rs53 on Thursday, earlier than the corporate introduced its outcomes.
Ola Electrical is going through a slew of challenges. The inventory market regulator is investigating allegations its gross sales figures have been overinflated and don’t match the federal government’s automobile registration information. The regulator has additionally cautioned the corporate for its tendency to launch materials info on social media earlier than informing traders, a violation of disclosure necessities. The ministry of heavy industries can be investigating Ola’s gross sales information, because the firm advantages from the federal government’s production-linked incentive scheme. And earlier this yr, the transport division in 4 states issued notices to the corporate for working showrooms with out correct paperwork.
By means of all this, Ola’s founder and chief govt Bhavish Aggarwal, who I feel appears to fancy himself as a homegrown Elon Musk, has continued his social media offensive, firing salvos at slapstick comedian Kunal Kamra and others who complained concerning the firm’s aftersales service. This has not helped his case, or endeared potential prospects to his merchandise.
Aggarwal likes being the brash start-up wunderkind. This can be a shtick that works when you’re profitable. Within the present market atmosphere, investor and buyer persistence is sporting skinny. What the corporate wants now’s a pacesetter who places his head down and focuses on fixing some basic product and advertising issues. Until Aggarwal comes up with an excellent turnaround technique, Ola Electrical won’t be zooming wherever. I’m not holding my breath.
Do you assume Bhavish Aggarwal will be capable to flip Ola Electrical round? Hit reply or electronic mail me at indiabrief@ft.com
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Farm to desk
Defending agriculture and dairy is India’s prime precedence in commerce negotiations with the US, and to this finish it’s prepared to take deep cuts in import tariffs on a variety of American items.
India ranked second globally in agriculture manufacturing worth in 2023, and although the sector’s share within the economic system has fallen up to now 25 years, at 16 per cent, it nonetheless contributes a bigger share than in different main international locations. It additionally employs 44 per cent of the nation’s inhabitants. Whereas India will enable cheaper imports of some much less delicate farm merchandise akin to almonds, presently topic to import duties of as much as 120 per cent, it should keep the next barrier on foodgrains and milk merchandise.
India has been racing to finish the primary spherical of negotiations earlier than July 9, when Trump’s reciprocal taxes of 26 per cent have been anticipated to kick in — though with the authorized tussle now over Trump’s tariffs, who is aware of what is going to occur. However, the Modi authorities’s choice shall be to get the deal executed shortly with the intention to keep away from the continued uncertainty fuelled by Trump’s frequent threats and U-turns. (TACO — Trump All the time Chickens Out — as my colleague Robert Armstrong places it.)
India’s financial coverage is leaning closely on the deal. In its month-to-month report for April printed this week, the finance ministry famous {that a} profitable take care of the US “may rework present headwinds into tailwinds”, opening up new markets and energising exports. That is overly optimistic, for my part. Whereas agriculture is getting some safety, manufacturing is adrift. Some sectors, most notably electronics and semiconductors, are rising capability as a part of the “China plus one” technique, however others are extra reluctant to spend extra on capital expenditure with none certainty on what the longer term will maintain.
One analyst instructed me that as there isn’t any readability on what even the following six to 12 months will appear like, exporters in sectors akin to textiles and materials have been selecting to attend and watch reasonably than commit cash now. Exporters are additionally involved that China will discover a strategy to be more economical than India regardless of greater tariffs. In a worrying signal, industrial output development slipped to an eight-month low in April, in accordance with information launched on Thursday.
Go determine
Kush Maini has grow to be the primary Indian driver ever to win a Method 2 race. Right here’s a snapshot.
Learn, hear, watch
I began watching Sirens, as a result of Netflix was throwing it at me irrespective of which nook of the web I used to be in, claiming I’d adore it. Reader, what on the earth is happening in that present? Is it a satire about wealthy individuals? Is it a present a couple of tough sibling relationship? Or was it merely made to fill us with actual property envy? I do not know. I gave up after three episodes. If in case you have any reveals you assume I’ll take pleasure in, please ship them my means.
Buzzer spherical
What connects Spazl, Ptitim, Paccheri and Testaroli?
Ship your reply to indiabrief@ft.com and examine Tuesday’s publication to see in the event you have been the primary one to get it proper.
Fast reply
On Tuesday, we requested: Do you assume Trump will additional postpone his “liberation day” tariffs? And the result’s . . . we don’t know. The ballot has gone lacking. Apologies!
Thanks for studying. Right now’s India Enterprise Briefing is edited by Mure Dickie. Please ship suggestions, strategies (and gossip) to indiabrief@ft.com.
