Explore FIC Hansraj

Last to leave this blog wins $1,000,000! This might be clickbait from our end, but there exists a person who can make this happen, and if you do not know that man, then you must be neighbours with Patrick Star under that rock of yours! Yes, I am talking about the real-life genius, billionaire and philanthropist. No! Not Elon Musk; it's actually MrBeast, the biggest YouTuber in the world and also the official heir of Twitter or X (whichever sounds better), according to the man himself! Now, ride a chocolate bar and fly to the other side of the globe, from the US to the UK, and picture two enemies who ironically became friends after fighting each other to death in a boxing ring. This time the protagonists are Logan Paul, a charismatic and often controversial YouTuber known for his larger-than-life persona and KSI, a gamer turned musician turned boxer and now a businessman! Let's take a deep dive into what these three musketeers have done besides just making YouTube content and casually earning millions. Beast of a Burger In a generation with an already saturated culinary space and arches of fast food giants, what made the MrBeast Burger stand out? Why was this launch buzzworthy, boggling thousands of minds? Let us dive right in! It is inevitable to say that the YouTube community is incomplete without mentioning MrBeast A.K.A. Jimmy Donaldson is known for his over-the-top stunts and charitable endeavours. In December 2020, like a surprise twist in a gourmet tale, the culinary space was served by the genius idea of the YouTube sensation when he decided to launch 300 virtual kitchens, dubbed MrBeast Burger and gave away food and cash to what seemed like thousands of people as part of the marketing. He also uploaded a corresponding video titled, "I Opened A Restaurant That Pays You To Eat At It” which has over 168 million views as of now! When MrBeast Burger hit the scene, it wasn't just a burger; it was a phenomenon! Orders poured in faster than you can say "extra cheese," causing a digital traffic jam. Yes, it topped the chart. But that's not all. It became so popular that, at its peak, its application rocketed to the top of the app store charts, getting more daily downloads than YouTube itself. But was this buzz just dumb luck? According to an interview with Bloomberg, Donaldson and his friends spent months researching and analysing what makes a video go viral and then integrating what they learned into their channel. Donaldson himself studied other YouTube videos and filmmaking, and he seemed to be a fairly good student! He used his massive YouTube following to announce the launch, creating a frenzy of excitement. But the real secret sauce? MrBeast didn't rely solely on his star power. He invited a league of social media influencers and harnessed the passion of his fans, proving it to be a marketing masterstroke. MrBeast Burger carved its unique identity in the fast-food world by serving up more than just delicious burgers. The brand flipped the script on the entire dining experience. Unlike the conventional dine-in spots, MrBeast Burger had joined hands with Virtual Dining Concepts to prepare delivery-only meals wherein customers ordered exclusively through delivery apps like Uber Eats and DoorDash, making it an app-etizing experience. By embracing a low-overhead model and serving up quality and affordability, the brand ruled the consumers’ hearts, while other traditional fast-food giants like McDonald's, Burger King, and Wendy's had to up their digital game to stay competitive in an increasingly digital market under financial pressure. In the competitive fast-food landscape, MrBeast Burger was indeed a replica of the words of a marketing professor, Jonah Berger: “Virality isn’t born, it’s made.” Feast of the Primus In an industry where sweetness reigns supreme, Hershey's had a very bitter opponent when MrBeast began smelting their brown bars, which we know today as “Feastables”. The marketing geniuses Logan Paul and KSI also came up with a toxic approach to disrupting an industry that is an elixir of athletic gods, and this time their adulteration is against another giant we know as Gatorade, and their poison is something we know as “Prime”. Both Prime and Feastables have very similar strategies because of a common link: the hunger of self-made millionaires to be billionaires! Let us look at their sweet yet fizzy strategy to reach where they are today, i.e., $250 million in sales by Prime alone. Firstly, both companies chose their respective idols in their industries, which were Hershey's in the Feastables case and Gatorade in Prime's, and respectfully made them villains in the eyes of their loyal fan following. Then the different use of scarcity by both brands helped them in their marketing. While MrBeast used it to give his brand an initial push by giving consumers a chance to win a “Mystery Ticket," only 10 of these tickets existed, and each represented the opportunity to be featured in a MrBeast video remaking Willy Wonka’s Chocolate Factory in real life. Here the scarcity is in the number of tickets, and more chocolate means more probability of meeting their favourite content creator and getting featured in his video. Apart from that, $1 million in prizes were also given to the consumers, which gave him the initial push to make $10 million in the first 72 hours of the launch. On the other side of the world, we had Logan Paul and KSI creating demand by limiting the supply of their brand using the modern-day loss aversion known as FOMO to give their product an energy boost like no other, maybe better than the one Prime could give you using the 200 mg of caffeine available in it! The last thing common between the two was that they used their experience and understanding of content creation to full effect and marketed their products like a pro, and this superpower of a built-in content engine is poised to deliver a knockout punch in the near future. Say “CHEESE” Ventures like Prime by Logan Paul, KSI, and Feastables, along with MrBeast Burger by MrBeast, have set out on a transformative journey in the food industry, fundamentally disrupting the conventional workings of big brands. As pointed out, these enterprises have adopted a digital-first strategy, leveraging their online presence and social media influence to reach a vast and diverse audience. Their menus, often inspired by their creators' personalities, introduce innovation and creativity, prompting big brands to reconsider their offerings. Additionally, their commitment to philanthropy, as exemplified by MrBeast Burger, has not only garnered positive attention but also placed a spotlight on social responsibility within the industry. By prioritizing online ordering and delivery, these ventures have redefined convenience and service expectations, compelling established brands to enhance their digital presence and delivery capabilities. Furthermore, their strong fan engagement and loyalty-building efforts have revolutionized the brand-consumer relationship. As these disruptive ventures continue to pave the way forward, the food industry's landscape is in a state of transformation, compelling big brands to adapt and innovate to stay competitive in this evolving marketplace. Sources The BBC The Guardian CNN NY Times Forbes Authors: Hardik Jain and Priyanshi Malpani Illustration: Prateek Verma

"Since economics can be out of this world." Lunar landings, and... rupees? In ancient times, our forebearers gazed at the sky and saw a realm filled with undiscovered wonders – catching a glimpse into a grand room of mysteries through a keyhole. Today, that keyhole has broadened into a portal through which we journey to the stars, planets, and beyond. Chandrayaan-3, the third Indian lunar exploration mission under the Indian Space Research Organisation (ISRO), is one such recent ambitious voyage towards space exploration. But does this venture only unveil space's marvels? Or could the launch, fueled by creativity and space exploration, also be steered by financial mindfulness? Moon for a Shoestring To a layman who knows nothing about space travel, one thing is certain - it wasn't cheap. But what if you were told that ISRO managed to achieve it at a cost lower than producing a movie? It sounds a bit absurd, but is it? It turns out, in comparison to what Christopher Nolan spent on making his popular 2014 film ‘Interstellar’, India did hit a space bargain. While Nolan spent nearly $165 million (Rs 1,365 crore, roughly) back when he was working on the iconic film, India only spent $75 million (Rs 620 crore) on its third moon mission, claim reports. The alarming gap between the cost of making the movie and sending a lander to the moon has left many astounded. Indians are often teased for their budget consciousness. But who would've guessed that this very trait would ultimately spotlight ISRO's incredible efficiency? Among global space agencies, ISRO's impressive cost-efficiency in space exploration stands out. Even in lunar missions, Chandrayaan-3's budget remains notably lower than its counterparts. The Chandrayaan-3 budget is a testament to the Indian Space Research Organisation’s (ISRO) knack for optimizing resources while aiming for the stars. In this surprising financial revelation, the world witnesses the dedication and cost-efficiency of ISRO in its relentless pursuit of exploring the moon, even in the face of extravagant cinematic budgets. Counting Stars, Saving Rupees Amid discussions of ISRO's cost efficiency, the question arises: How does it fund its endeavours? The government's budget allocation is a cornerstone, while in 2020, the space sector welcomed private players. The creation of the Indian National Space Promotion and Authorization Centre (IN-SPACe) under ISRO lends further support to this collaborative leap. Let's take a closer look at ISRO's financial framework and what it takes to fuel a successful mission. When a project is proposed, the institutions behind it are expected to leverage their existing infrastructure. ISRO steps in with financial grants to cover fellowships, materials, consumables, internal travel, testing costs, and data expenses. For instance, imagine a project aiming to develop a new satellite technology. The institution proposing it would use its labs and facilities, while ISRO's financial support would help cover the costs of materials, travel within the country, testing procedures, and data analysis. Moreover, the funds can be allocated for purchasing minor equipment that's essential but not available in-house. For instance, if a research institution lacks a specific piece of equipment crucial for the project's success, ISRO's funding can fill the gap. In essence, ISRO's financial structure acts as a collaborative booster, nurturing projects by blending existing resources and targeted financial support. This financial orbit doesn't just end with celestial balance sheets; it takes us on a cosmic journey to explore its impact on the Indian economy. Launchpad to Prosperity The successful landing of Chandrayaan 3 on the lunar south pole is a major milestone for India's space program, demonstrating the country's growing scientific and technological capabilities. This achievement can be traced back to the time when the Apollo 11 mission, which landed Neil Armstrong and Buzz Aldrin on the moon on July 20, 1969, became a significant accomplishment for the United States as the first country to achieve this feat, providing a substantial boost to the American economy. Similarly, the successful implementation of Chandrayaan 3 positions India as the first country to achieve this feat, resulting in the creation of new jobs in the space sector, including scientists, engineers, technicians, and administrative staff. This, in turn, will enhance economic activity in related industries such as manufacturing and IT. While NASA is often viewed as the most successful space organization due to its numerous contributions to the sector, the Indian success story of ISRO will finally bring the recognition and respect that our scientists deserve on a global platform. This exceptional feat will attract increased investment in space research and development by both the government and the private sector. Consequently, this will lead to the development of new technologies that can be utilized to foster international cooperation in space exploration. This, in turn, could result in the sharing of knowledge and technology, benefiting all participating countries. Telescopes and Tickers The impact of a country's achievement in a specific sector often triggers a ripple effect, influencing other industries to flourish in its wake. A profound domino effect is anticipated as the mission etches its name onto history's pages. This journey to the moon has the potential to give a significant boost to the aerospace and defence sector. The increased demand for products and services in this realm is likely to translate into greater revenue and profits for companies operating in this domain. Amidst the lunar exploration, the use of robotic technology takes centre stage. This move could spark a surge in demand for robotics technology, benefitting major players like Tech Mahindra and Wipro. As the entire country rejoiced in this remarkable achievement, the Indian stock market harmoniously joined the celebration, presenting investors with the joyous sight of green candles. Companies like Larsen & Toubro (L&T), Bharat Electronics (BEL), Hindustan Aeronautics Limited (HAL), and Avantel surged, symbolising a reciprocal gift for their invaluable contributions to ISRO, which directly contributed to the triumphant success of Chandrayaan 3. Space, Finance, and Future Converging The Sanskrit word for "Moon Craft," exemplifies ISRO's ability to reach for the stars while keeping its feet firmly planted on the ground of financial realism. Amid the accolades for Chandrayaan 3, a vital dialogue emerges—private investments' potential impact. This moonlit success story, woven with ISRO's efficiency and quality, risks reimagining due to increased commercialization. Consider the analogy of a once-hidden gem now attracting myriad eyes. The question arises: Will the gem remain untainted as the allure of profit shines brighter? The past offers guidance: aviation's exploration metamorphosed into a profit-oriented industry. Could ISRO follow suit? While private investments bring innovation, they tug at ISRO's essence. The dialogue isn't one-sided; private funding can widen horizons. Yet, the question lingers: how to strike the balance? Chandrayaan 3's journey is an invitation to cherish exploration's spirit while leveraging collaboration's fruits. As we tread the path to the cosmos, may we remember that reaching the moon isn't just about touching the skies but remaining grounded in the values that guide us. Authors: Sehaz Nagpal and Harsh Agarwal Illustration: Hemanjot Singh

For us die-hard Marvel enthusiasts, the brand stands as an unparalleled and revered entertainment giant worldwide. From animated discussions about the future of the Marvel Cinematic Universe to engaging in friendly MCU trivia with friends, or even crafting elaborate conspiracy theories for Reddit, Marvel’s allure is undeniable. Yet, little is known about the financial hardships that pushed this titan of entertainment to the brink of bankruptcy during the 1990s. But how did it rise from those challenges to regain its glory? And the burning question persists: will this triumphant journey continue on its path? The Fantastic Four and The Amazing Spider-Man comics, among others, helped Marvel gain popularity during the 1960s, 1970s, and 1980s. By the early 1990s, however, the company's financial prosperity had peaked. Marvel's stock value fell after a slew of financial bubbles burst and dubious business agreements; shares previously worth $35.75 each in 1993 were now only worth $2.375 three years later. The future seemed uncertain. “Reality is often disappointing.” Every great comic book story has what is known as its "darkest hour"—a turning point where all appears lost. The villains are closing in for the kill while the heroes are on their knees and the city is a burning ruin. The winter of 1996 marked Marvel's lowest point. Heroes, Hiccups, and Hurdles Marvel's downfall in the 1990s can be attributed to several interconnected factors. The comic book industry suffered a significant setback in 1993, experiencing a massive 70% drop in sales. Even Marvel itself encountered failures in the film realm, like "Howard The Duck," which garnered a mere $38 million at the box office. The technological limitations of that era also hindered the full realization of Marvel's characters on screen without substantial financial investments. Marvel Entertainment's attempt to rapidly diversify and expand without proper planning proved detrimental. This resulted in a lack of focus and diluted brand identity, leading to decreased quality across various fronts. In 1996, Marvel was compelled to declare bankruptcy due to mismanagement, inadequate revenue from comic book sales, and licensing agreements. The company's swift expansion failed to deliver anticipated profits. The comic book market was oversaturated during the 1990s, flooded by rival titles and Marvel's abundance of offerings. The creative output became formulaic, causing a decline in quality and reader interest. Additionally, Marvel faced costly copyright infringement lawsuits, further impacting profits. A failure to invest in long-term branding strategies and capitalize on its strong brand image contributed to the company's loss of market share. Ron Perelman's involvement exacerbated Marvel's downfall. In 1989, he acquired Marvel Entertainment Group for $82.5 million. Marvel went public shortly thereafter, and Perelman initiated extravagant spending. The company gained temporary success by encouraging collectors to purchase multiple copies of comics to obtain exclusive trading cards. However, this unsustainable strategy, akin to the tulip mania of the 17th century, led to a bubble that ultimately burst. Between 1993 and 1996, revenues from comic books and trading cards declined, and escalating prices dissuaded many fans from collecting. Marvel’s Phoenix Saga Marvel's journey, reminiscent of the Phoenix Saga, is a story of triumph over adversity. Its impeccable bounce-back is often attributed to the creative and strategic guidance of film producer and Marvel President Kevin Feige after 2007. But not enough is said about the savvy financial decisions made in the 1990s and early 2000s that took Marvel from bankruptcy to being one of the biggest movie franchises, generating $25 billion in revenue worldwide. Phase I: Whatever It Takes The bursting of the "Comic Book Bubble" resulted in Marvel being burdened with losses and debt. It was finally merged, after filing for bankruptcy, with Isaac Perlmutter’s Toy Biz in 1997, and Peter Cuneo was appointed as CEO of Marvel Entertainment in 1999, a partnership proving stronger than the Avengers initiative. His first move was to cut costs and link employee incentives to cash flow instead of profits. While the payroll scaled back from 1658 workers in 1998 to 250 in 2002, the company was careful to retain talent and not crush it by underpaying the artists, for they were the foundation layer on which the company stood. The operation mirrored the kind of financial rebound one might associate with Stark Industries, as the company saw its cash ratio shoot up from 30% in 2001 to 59% in 2002. The net income rose from $5.3 million to $53.7 million, a staggering 426% rise within a year-quite like Tony’s first flight. Phase II: We have IPs! However, Marvel’s cash crunch was way worse than that of the Avengers after the endgame, so it needed more risky measures than just cost cuts. Thus began Phase II of bounceback, which resulted in Marvel selling the film rights of its most prized characters like Spider-Man to Sony and the Hulk to Paramount, and 21st-century Fox buying the rights of Daredevil, the X-Men, and the Fantastic Four, reminiscing about the feeling when Thor lost Mjolnir. The selling and licencing of various characters helped it bring in both capital and revenue receipts. It also helped in the in-house production of Marvel merchandise, as the company was able to secure a low-cost revenue stream of royalties and commissions for itself. These risks were like the collection of infinity stones, as one by one they helped Marvel quickly generate cash to pay off its debt and convert its preference shares into regular ones. Phase III: Avenging the Fallen While these deals saved Marvel from financial ruin, they came at a cost, like trading the Black Widow’s soul for the power of the Soul Stone, as the company had to sell its IPs at very low valuations, and the revenue of $25,000 and $62 million on movies like X-men and Spiderman was meagre compared to the enormous box office earnings of each movie. The upside for Marvel was too low. It only made sense to start in-house production of movies to reap all the profits, given the love and popularity the licenced characters have received . The financial requirements for the same were met by a loan from Merill Lynch of $525 million and a budget of $140 million, and Marvel’s first solo venture movie, Iron Man, was ready to be released on big screens. The stage was set for the biggest financial risk to be played, for if it goes sideways, it could mean Marvel losing its 10 most beloved characters’ IP rights and possibly ending its glorious legacy. Luckily, the gods seemed to be on Marvel’s side as they pulled off that one outcome out of the 14,000,605 outcomes, Iron Man turned out to be a huge success with a box office collection of more than $585 million, and this marked Marvel's moment of comeback. Post Credits It's true that at one point, Marvel seemed as inevitable as Iron Man, but lately, it's hit a rough patch. Once celebrated for its gritty and diverse storytelling, it's as if the Infinity Gauntlet has lost its power. The Disneyfication of Marvel made it feel more like a theme park ride than a captivating narrative, leaving fans yearning for the depth they once found. Adding to the turmoil, the lack of diversity in storylines and representation became as noticeable as a headline-grabbing Daily Bugle article. Quality control problems plagued the cinematic and TV offerings, leaving fans cringing at the declining standards. Marvel's failure to address societal issues drew criticism from all over the multiverse. And let's not forget about fan fatigue, which descended upon us like Loki's mischief, exacerbating the already troubled situation. Although Marvel’s journey from bankruptcy to a significant entertainment juggernaut is no less than its superhero journeys, now they face a new problem to adhere to. Like its memorable characters, the company needs to learn from its mistakes and make bold decisions in times of adversity. After all, it takes an Avengers-level team, the financial prowess of Tony Stark and some Stark Industries innovation to save the day (or everyone's childhood). Authored By: Purav Tayal, Arunav Sharma Illustrated By: Hemanjot Singh

In the grand calculus of the ONDCverse, does the sacrifice of the big giants mean far more than their inevitable deaths? The Infinity Marketplace Let's give it up for a virtual junction that brings together global giants and hometown favourites to avail a mela of goods at your fingertips. This unique platform, known as the Open Network for Digital Commerce (ONDC), provides access to a vast array of products, from the latest fashion and high-tech gadgets to handcrafted artisanal delights, all in one convenient destination. Bridging the gap between imagination and possibilities, this blockchain-based platform aims at revolutionizing E-Commerce in India. So, what precisely is ONDC, and what impact will it have on Indian marketplaces? Moreover, how do the kings of e-commerce respond to this new development? Hotel? Trivago! :: E- shopping? ONDC! Remember those iconic Trivago advertisements? Trivago offered a single platform to compare hotel prices from various websites, making comparisons a breeze. Similarly, ONDC offers a similar interface for everything available for online purchase, allowing you to effortlessly compare prices from multiple platforms. ONDC creates a multiverse where renowned e-commerce giants such as Amazon, Flipkart, and Nykaa coexist with local gems like Chai Point, Urban Ladder, and Behrouz Biryani, converge on one app. Therefore, it provides the convenience of purchasing both Apple, the fruit, and Apple, the phone, at a single destination. The initiative aims to revolutionise e-commerce just like UPI reshaped online payments. Under the guidance of Nandan Nilekani, the man responsible for Aadhaar, ONDC is considered the government's most ambitious project and will lead to the democratisation of e-commerce in India. ONDC goes beyond being just an app, platform, aggregator, or competitor. It is a dynamic network that connects buyers, sellers, logistics providers, and payment gateways to facilitate business transactions and revolutionize digital commerce in India. The one app for all your apps helps connect any buyer to any seller registered on the platform while ensuring the best deals at the best prices. More choices lead to more power for consumers, thereby hampering the price-curbing powers of sellers. If one could compare the price of the air conditioning unit from sellers Voltas, Samsung, and Blue Star, then this would force the brands to compete for the best prices. Therefore, bid farewell to inflated prices and high delivery charges. Empowering the "MSME-gnificent" ONDC is a dynamic network empowering sellers and consumers alike and has a profound impact on micro, small, and medium enterprises in India. Let’s delve into the hypothetical story of “The Spice Emporium”, a family-owned business of handcrafted spice blends in the village of Gujrat. They need to reach a broader audience beyond their hometown. This is where ONDC, the formidable superhero of connectivity, enters. With its remarkable powers, ONDC seamlessly bridges the gap, allowing customers from vibrant cities like Mumbai, Delhi, and Bangalore to savour the exquisite flavours of The Spice Emporium, delivered right to their doorsteps. The implementation of ONDC will have two significant benefits for The Spice Emporium. Firstly, it will eliminate entry barriers and foster competition and allow the business to thrive in the digital marketplace. The platform will provide unparalleled exposure and freedom and will enable the company to expand its reach and compete with larger players. Secondly, ONDC's standardized protocols will enhance the efficiency of operations, including cataloguing, inventory management, and order fulfilment. This will optimize performance, deliver a seamless customer experience, and help build trust and credibility. The Blackhole in the ONDCverse In the vast landscape of digital commerce, ONDC emerges as both a gateway and a battleground. For small businesses, it's like navigating through a maze without a guiding light, as the lack of tech support casts shadows on their digital ambitions. Meanwhile, the giants of e-commerce loom large. It may lead a consumer to stand at a crossroads, facing a dilemma between the convenience of various payment options and concerns about their security and reliability. And even after the transaction is completed, a lingering question remains: Who takes responsibility when there are issues with the purchase or if the product/service falls short of expectations? These challenges, exemplified by a local artisan seeking tech assistance, a boutique competing with established brands, and customers facing payment and liability uncertainties to buy the latest smartphone, underscore the need for comprehensive solutions to ensure a fair and trustworthy ONDC ecosystem for all participants. The Dual Duel The proclaimed prodigy of UPI is still in its beta version, yet it has managed to create significant tremors in the realm of Indian e-commerce, challenging the existing duopolies. But the question arises as to why companies like Amazon-Flipkart, and Swiggy-Zomato should be concerned by a seemingly gimmicky game changer whose total orders in a day are not even 1% of the orders processed by these not-so-gentle giants. But there is a reason that even after bringing in 36,000+ sellers across 236 cities, the biggest players in the Indian e-commerce market are mum about joining ONDC via their main apps, and their silence echoes the weight that rests upon their shoulders. Joining ONDC will be a double-edged sword for the Juggernauts; If they join the network, they will not be able to play their dirty dual game, because of which they are under the inspection of CCI, which is also the reason for their superficial growth. The Imitation Game A thought arises: What is this dual game, and why do the Titans hold it so dearly, unwilling to loosen their grasp on it? It is a seemingly simple process of collecting priceless consumer data through their platforms, which they selfishly withhold from the sellers. However, Amazon takes it a step further, using this goldmine of data to strategically place its products on the platform based on the market insights gained and aggressively promoting them, ultimately encroaching upon the market share of unsuspecting sellers who remain oblivious to this trickery. If implemented correctly, ONDC has the potential to become a beacon of hope for these sellers and countless other small-scale merchants, bridging the gap and dismantling the e-commerce monopoly. A Superhero in the making After comparing it with everything in this world, let's make one last analogy with our beloved ONDC. Picture the emergence of a new "superhero," and ONDC is stepping onto the stage with a similar sway over the stock market, just as a new superhero brings about a set of challenges and opportunities. As with the superhero journey, which would bring fiery highs and icy lows, ONDC is going to impact the stock market similarly. Some stocks are benefiting from ONDC, and some are losing their touch. While stocks like RIL, Delhivery, and PayTM expect growth and prosperity because of the glory of their logistics fleets, stocks like Indiamart will be negatively impacted due to their direct competition with ONDC. One thing is certain: whether ONDC grows or fails, it will cause lots of seismic tremors in the stock market’s very foundation. 14,000,605 Possible Outcomes Through ONDC, India has the potential to become a role model for other nations. While governments in the US and Europe are grappling with tech giants through laws and regulations, India has embraced a tech-based solution backed by market forces and enabling regulations. With visionaries like Nandan Nilekani and organisations like Ispirit leading the way, India has provided ONDC with the best possible chance to walk the talk. Now, it is time for them to take action and for us to contemplate whether the manifested UPI of e-commerce will succumb to the pressures imposed by the industry behemoths or if it will gently shorten the stature of these not-so-gentle giants. Sources Forbes TOI The Economic Times CNBC TV 18 Authors: Hardik Jain and Sehaz Nagpal Illustration: Prateek Verma

In a surprising move, India's central bank made a major announcement on 19 May 2023 revealing its intention to bid farewell to the Rs 2,000 notes merely seven years after their debut on 8 November 2016. The Reserve Bank of India (RBI) emphasized that while the notes would lose their place in circulation, their status as legal tender would persist. Beginning May 23, the central bank has announced that individuals can exchange their notes at 19 regional offices of RBI and various bank branches. They have the option to swap the withdrawn currency for lower denomination notes or deposit it directly into their bank accounts. This exchange or deposit facility will be available until September 30 2023, allowing ample time for transactions. To ensure smooth operations, the central bank has set a limit of exchanging notes valued up to Rs 20,000 at a time. These guidelines are alluring enough that the note would cease legal tender after that date. The Clean Note Policy implemented by the Reserve Bank of India (RBI), which seeks to ensure that citizens have access to fresh and crisp currency notes and coins while withdrawing worn-out notes from circulation, quickly gained significant attention and was cited as the rationale for this action. Routine Too Mainstream In an effort to combat illicit activities such as black money circulation, tax evasion, terrorist financing, and counterfeit currency, the economy underwent a demonetisation process in November 2016 in which two of the highest-value currency notes ceased to be considered as legal tender. With time, the introduction of the Rs 2,000 note was highly criticised as it made storing black money even easier and the instances of black money seizure continued. If the objective was to remove soiled notes from circulation, then they should have been replaced with fresh notes of the same denomination. No matter how much the central bank and the government accentuate its Clean Note Policy, this move may be the economy's way of rectifying mistakes done in the past. As per the central bank's statement, the Rs 2,000 notes aren’t commonly utilized for transactions. They highlighted a significant decline in the number of these notes involved in transactions, from a peak value of Rs 6.73 lakh crore in March 2018 making up 37.3% of the circulating notes to Rs 3.62 lakh crore in March 2023 representing only 10.8% of the circulating notes. This not only raises questions about the rationale behind the introduction of the new note, but it also prompts us to contemplate the government's decision-making abilities. People endured the unfortunate fate of standing in never-ending queues, while hospitals turned into currency exchange centres, denying treatment when presented with old currency notes. Amidst this turmoil and distress, the underlying purpose and justification behind these actions still remain a question. Barely a Blip According to the government, no perceptible effect on the economy is expected till now as the currency will either be replaced or deposited. No significant increase in bank liquidity, tax collection and seizure of black money is expected as people have numerous avenues to change the colour of their money. Also, newspapers reported an anticipated rush to jewellery shops to exchange notes. Likewise, the initiative is not expected to have a significant effect on MSMEs or the agriculture sector. Since the majority of MSMEs operate within the GST network, they are not heavily reliant on large denominations like Rs 2000 currency notes. But if an economy suddenly chooses to eliminate its highest denomination currency note, it would be highly unlikely for such a decision to have no discernible impact. This significant change is poised to impact multiple facets, prompting the question of its potential consequences. Matter of Faith The central bank holds a paramount position within a nation's financial system. The public has high expectations for the bank's unwavering integrity. However, beyond integrity, the central bank also demonstrates competence, transparency, and equity to effectively fulfil its role. Although this move doesn’t seem to show instant effects on banking, agriculture sector, MSMEs, inflation, money supply etc. it may still erode the value of the currency over time. Inflation and exchange rates are the two things which come to mind when we talk about the value of the currency, but there is a more fundamental sense in which the value of a currency is to be understood, and it has nothing to do with prices. It has to do with the confidence that citizens have in its continued acceptance as a medium of exchange and store of value. This confidence is based on the trust that they repose in their monetary authority, which is the central bank. The demonetisation measure implemented in 2016 sparked inquiries and had a detrimental impact on the economy. Now, as the central bank introduces another plan of uncertain value, it invites further contemplation and assessment. By revisiting its own decision to introduce the Rs 2,000 note, the central bank inadvertently draws attention to its past lapses in judgment. The amendment of the RBI Act 1933 in 2016 aimed to redefine monetary policy in terms of inflation control. Despite not achieving the targeted 4% inflation rate for 14 consecutive quarters, the central bank's consistent messaging creates the impression of unwavering dedication to combating inflation. Perhaps this commitment is genuine. However, the unintended consequence of raising doubts about the public's perception of legal tender in India undermines their confidence in the stability of the rupee. Sources: RBI The Economic Times The Hindu Outlook Author: Priyansh Kotiya Illustrator: Ojas Arora

The next big thing in tech isn’t the blockchain or the metaverse—it’s a mind-bending wave of algorithmic content machines. Imagine software conjuring up entirely new cities from scratch, inventing new languages and generating images of people who don’t even exist! It seems like a far-fetched dream, doesn’t it? The mighty power of artificial intelligence, however, has made this our new reality. Artificial Intelligence has been popping up everywhere in the mainstream and making headlines in leading news articles. It is most certainly the latest buzzword on everybody’s lips, but not an entirely new concept. The AI revolution has been taking place for quite some time now, although the pace has been steady. Unknowingly, it has crept into our daily lives, our streaming habits for instance. Netflix and Spotify make use of AI to suggest content based on the stuff already watched and listened to. This is only the tip of the iceberg. From making its presence known in multiple avenues from Siri to Alexa, self-driving cars to predictive marketing, AI is making its mark in modern times and we are at the cusp of a tech revolution. Decoding the enigma Generative AI, one of the most promising areas of Artificial Intelligence, has been wowing the internet with its ability to push the boundaries of what's possible. One could consider it a genie, granting our wishes for efficiency and precision with a wave of its digital wand. With the capability to read text, images, audio, and video data, it creates new content that is uncanny in its resemblance to the original. Generative AI functions using unsupervised or semi-supervised learning to process large amounts of data and generate novel outputs. For instance, if we want the AI to be able to paint like Picasso, it needs to be fed as many paintings by the artist as possible. The neural network at the base of generative AI can learn the character traits or features of the artist’s style and then apply it on command. This process is replicated for models that write texts and even books, create interior and fashion designs, non-existent landscapes, music, and more. The popularity has been maximized as a result of the proliferation of AI-powered chatbots ChatGPT and Bard. They have taken the internet by a frenzy, blurring the lines between man and machine. AI assemble! The chatbot search wars have begun. Two of the biggest tech giants, Microsoft and Google, have been kept busy in the race to build a generative artificial intelligence tool. Microsoft’s market capitalisation has reached 2 trillion dollars for the first time in nearly six months after it added ChatGPT to its search engine Bing. The company has also planned to integrate its artificial intelligence technology into its productivity apps including Word, PowerPoint and Outlook. Meet Bard, Google’s answer to ChatGPT. It is an experimental conversational AI service, powered by the Language Model for Dialogue Application (LaMDA). It had initially tried to give equal competition to ChatGPT. But the bot isn’t off to a great start, with experts noting that Bard made a factual error in its very first demo. Even Quora and Alibaba have entered the competition. Generative language tools mentioned above will undoubtedly change what it means to search the web, shaking up an industry worth hundreds of billions of dollars annually, by making it easier to dig up useful information and advice. The algorithms they use are designed to predict what should happen after a prompt based on statistical patterns in huge amounts of text from the internet and books. The AI search wars may have begun, but perhaps the winner won't be the most powerful chatbot, but the one that messes up the least. Let AI do the work for you In addition to producing paragraphs of solidly written English (or French, or Mandarin, or whatever language you choose), this AI can also generate blocks of computer code on command. Besides students generating entire essays using ChatGPT in the classroom, hackers have begun developing malicious code with it as well. Some universities have also banned the use of ChatGPT as it is considered an unreliable source. The ability of this impressive bot to clear competitive exams like medical and law has taken the world by surprise, and many believe that people are going to see years as pre and post-ChatGPT. Microsoft co-founder Bill Gates said he believes that OpenAIs chatbot ChatGPT is as significant as the invention of the internet and it will “change the world”. Such new programs will most definitely make many office jobs more efficient by helping to write invoices or letters but whether they will replace search engines is a different question altogether. Double-Edged Sword ChatGPT is truly a game-changer in the conversational technology industry, but also raises important questions about the potential risks and challenges associated with this technology. Some have claimed that the bot is limited to the knowledge and choices that are already on the internet. One should be aware that it is not capable of verifying the accuracy of the information in training data and may generate responses that are false or misleading. The use of AI language models also raises questions about the privacy and security of personal data used to train and improve them. It is very evident to state that ChatGPT and other AI models have the potential to displace jobs by automating repetitive tasks such as data entry, customer service, etc. However, the displacement of jobs due to AI automation is a complicated issue that can cause economic disruption and impact several industries. While there may be job losses in certain industries, AI will also create new job roles in related fields. Fast-forward to the Future As the generative AI era is now duly anointed, what might the next leap or epoch look like? It is a comforting thought to believe that we are capable of adapting in pace with the changes coming with generative AI. However, like a foreshock presaging a large earthquake, this new epoch could be a precursor to an even larger event, the coming AI singularity. The multitude of AI tools now at our disposal accurately represents that there may come a time when AI surpasses human intelligence. Keeping in mind, these are just a few of many models that are in the works, from both companies you know, like Google, and others you may not. It is possible that within the next couple of decades, there could be another ChatGPT-like moment when the world shakes again, even more than it has with generative AI. Source: thePrint Hardvard Business Review Digitaltrends Authors: Vanshika Mittal and Riya Sethi Illustration By: Muskan Bansal

We are all familiar with Lego, the acclaimed block-building game containing hundreds of colourful bricks and a how-to guide for your dream city. Remember bargaining with your parents for the more expensive 800+ Battleship set, moving furniture everywhere in a desperate attempt to find that grey 3*2 piece or the death cry of stepping into another lego while finding that piece. Lego has surely given us some beautiful childhood memories. However not much is known about how the biggest toy brand was on the brink of bankruptcy back in 2003. The concept of connecting blocks first came in 1962 but it didn’t catch much attention until 1967 when it was released as a complete set. Finally, in 1969 the iconic lego block was released, the exact design which is used in modern day lego! Despite the initial disapproval from the public, Lego saw the potential in its product and kept improving till it became a massive hit. With the rising sales and popularity, Lego decided to diversify with video games and theme parks. But as we’ll see it didn’t turn out the way they expected. Building Blunders Once upon a time, the Lego kingdom was a sprawling empire, stretching across the toy shelves of the world. But as with all empires, the kingdom began to show cracks, and before long, it was tumbling down like a poorly constructed tower of blocks. The root of the problem was a series of missteps, each one chipping away at the foundation of the company. Dispelling the myth: growth ≠ success To put it simply, Lego got a little too big for its bricks. The company was so enamoured with its own success that it overreached, spreading its reach across the globe like wildfire. But just like wildfire, this over-expansion consumed everything in its path, leaving the company with too many products, too many lines, and a brand identity that was starting to look like a jumbled mess. The company had taken reinvention a bit too seriously, in the 1990s. They started venturing into the production of not just their signature bricks but included a lot of different lines of products. They got into the making of merchandise, publishing books, and launching their theme park, Legoland, in the UK (1996) and the US (1999). And this was all in a bid to capture the trends they thought children were now interested in. They overreacted to trends and started over-diversifying. And they did what many other brands did – they expanded from their core, and like many other brands, they lost their heart. What may have seemed like a logical and necessary expansion, was mainly a result of the fear of being outdone. Mismanagement Madness In the early 2000s, the Lego kingdom was facing some serious internal problems. It was like trying to build a castle without knowing how many bricks you had - not exactly the foundation for success. The chief marketing officer, Mads Nipper, admitted that the company was in the dark when it came to their costs, which is a problem when you're dealing with building blocks. It turns out, they had been relying on top graduates from design schools in Europe, who were great at designing but didn't have much experience with the little plastic bricks. The result was that certain sets were costing more to make than they were selling for. It was a perfect storm of mismanagement and poor decisions, but the crazy part was that no one actually knew just how bad it was. It was like a house of cards, but instead of cards, it was made of blocks, and instead of falling down, it was losing money. Missed the tech train The world was rapidly changing, with new technologies transforming the way people played. But while its competitors were jumping on board and exploring the digital world, Lego was still relying on traditional methods, as if playing with blocks was enough to keep the kids of the new millennium entertained. The above mishaps shattered the castle built by the lego masters. The once booming company was now in humungous debt of around 800 million dollars; the future was looking pretty bleak for the Danish toy company. Building a Better Future: The Resurgence of Lego "Simplicity is the silent symphony of solutions." Despite these negative developments, at the heart of things, Lego is a straightforward company that achieved success thanks to its innovative and imaginative product, coupled with outstanding marketing strategies. While expanding in other areas they not only lacked a satisfactory USP but also lost sight of their fundamental product. To make a successful turnaround, Lego simply had to focus on improving its core strengths while eliminating distractions that were not essential. Change In Management Jørgen Vig Knudstorp was appointed as the first CEO of Lego outside the family after serving as the Director of Strategy for three years. Despite the challenges that the company was facing during this time, Knudstorp accepted the challenge and transformed Lego into what it is today. He reorganised the company's structure, streamlined the supply chain, simplified the product line, and introduced five-year plans. He also reduced unnecessary variations and placed a strong emphasis on the power of the Lego brick, which ultimately became a key factor in the company's successful comeback. Realigned Priorities A well-known saying goes: “If you keep doing the same things, you’ll keep getting the same results.” However, in Lego’s case the opposite is true. Despite their initial success Lego lost focus and got distracted by diversification. Thus in order to be successful again they switched back to their tried and tested methods and got rid of unnecessary distractions. First, the company sold all four of its Legoland theme parks, which not only brought in additional cash but also reduced their maintenance costs. In addition, the company simplified its product line by eliminating unnecessary variations, which had previously only added to its expenses. Finally, Lego temporarily discontinued its video games program in an effort to focus on its core business. Thanks to all these changes Lego regained focus and quickly became profitable once again. Marketing & Collaborations Throughout history, we have witnessed several traditional business giants go bankrupt because they failed to recognize the impact of modern technology. Despite the evolution in the gaming and entertainment industry, Lego not only managed to survive but also continued to grow at a remarkable rate. By collaborating with video games and movie franchises, Lego leveraged technology as a catalyst for growth rather than resisting it. The comparison between Star Wars and Lego is often made to that of peanut butter and jelly. With each new Star Wars movie, the sales of Lego Star Wars sets increase significantly. But this is not limited to Star Wars alone. Over the years, Lego has partnered with a wide range of franchises, from Whimsical animes all the way to Classic James Bond. If there's a franchise you enjoy, chances are that there's a Lego set dedicated to it! Universal Audience Most games are categorised as being for either boys or girls, but Lego has shattered these gender and age barriers. Thanks to its numerous partnerships, Lego has been able to build its sets in all genres; be it Marvel, or Frozen, or Harry Potter. Lego sets are also available in a range of difficulties, from sets with fewer than 10 pieces to the challenging 11,695-piece Lego Art World Map or the Lego Titanic containing 9,090 pieces. The latter being sophisticated enough to captivate even adult audiences. In fact, Lego has an entire community of adult fans, known as AFOLs (Adult Fans of Lego). So, no matter your age or gender, there is always a Lego set for you. Happy Ending to the Toy Story Lego's downfall was like a game of Jenga gone wrong—every time they pulled out a brick, the tower seemed to crumble more. But, like any true game master, Lego wasn't ready to concede defeat. They took a deep breath, gathered their pieces, and set out to rebuild. Slowly but surely, brick by brick, they pieced their company back together. Now, Lego is back in the game, ready to take on new challenges and reach new heights. So, here's to Lego, the company that proves that even the greatest of towers can be rebuilt and restored. Author: Esshan Wadhawan, Palak Bansal Illustration By: Ramya Sehgal

The world has always been on the move; a place of constant progress where innovation and technology have known no bounds. Virtually every aspect of our lives has been impacted, thanks to technology grabbing the steering wheel and speeding ahead. Let's take a closer look at one such aspect: the gig market. The gig economy comprises a labour market that relies heavily on temporary and part-time positions filled by independent contractors and freelancers, rather than full-time permanent employees. The employment is on a short-term and payment-by-task basis. It involves contract-based undertakings over a period of time, and there are no fixed terms. For better understanding, let's assume that there are two college students: Payal and Sahil. Payal, in addition to pursuing her degree, is learning video editing skills through online resources and webinars. On the other hand, Sahil simply goes by his day in college, returns home, and waits to complete his degree before he starts any kind of work. Payal, after completing her online course, gets a client who needs a video editor for a mini-documentary, just a small gig. She grabs the opportunity, does the work, and earns a small amount. Here, Payal has become a part of the Gig Economy. Is the Gig Economy a recent development or something that always existed in the market? Let's try to analyse the rise of this new way of working. BUDDING BAY OF OPPORTUNITIES? A recentreport published by NITI Aayog has revealed some insightful statistics about the growth prospects of this sector, stating that more and more companies are preferring to hire employees on a project basis and that 90-110 lakh additions to the gig workforce are expected by 2025. A report by the financial platform StrideOne revealed that gig workers in the start-up will make up about 4% of India’s total workforce by 2024. The report also states that in the long term, this sector has the potential to add over 9 crore jobs in the non-farm sectors of India. The numbers are clear, the gig economy is quickly taking centre stage and is becoming one of the most important aspects of future employment and economics. Flexibility to work from anywhere, the rising demand for contractual employees, and changing work approach of the millennial generation are some of the reasons for the spike in the popularity of the gig economy. If that’s not it, the start-up frenzy created another boost for the gig system. Start-ups that can't afford to hire full-time employees have started turning to short-term contractual workers for non-core functions. THE RISE OF THE GIG MARKET So, folks, the facts and figures paint a clear picture. This sector could potentially skyrocket: witnessing exponential growth and an inflow of skilled workers. This not only impacts the traditional 9-5 workers but also the current economic aspects and employment outlook. According to long-term projections, the gig economy's success could add up to 1.25% to the GDP of the country. It could also help reduce the income and unemployment disparities in India, as we move towards the goal of becoming a USD 5 trillion economy by 2025. A NITI Aayog Report states that an estimated 22% of gig work currently belongs to high-skilled professionals, like consultants and graphic designers, 47% falls under medium-skilled, and 31% under low-skilled jobs. Although blue-collar jobs currently form the better chunk of this sector, there is also a steady rise in white-collar opportunities. THE TRADE-OFF This change in the job market has a profound impact on traditional business models, and it is pushing companies to re-evaluate their business strategies and operations. It also brings a shift to traditional workplace dynamics and relationships, in one way or the other. Because of the transitory nature of gig work, a lot of times long-term work relationships, not only with co-workers but also with clients, might not be formed. Picture this, a client returning to an organisation because of the trust and familiarity that they have with an existing employee of the company. This is quite common traditionally, but if the same job is now given to a gig worker, this might not happen. Since they work on temporary contracts, gig workers mostly stick around with the company for the duration of the contract, until they eventually move on to the next gig. Moreover, despite such a high number of workers in this sector, they still have limited or no access to traditional employee protections and other formal sector perks like job security, paid leaves, employer-sponsored retirement benefits, etc. Notwithstanding the foregoing, there are a whole host of benefits to hiring gig workers. Companies can skip the traditional cycles of hiring workers and spending on their training; they can simply hire gig workers, as and when they are needed, making the whole process much more cost-effective. Moreover, employers have access to a broader pool of workers to choose from, which makes finding the right person for the job quite easy. Additionally, such work allows individuals to enjoy a healthy work-life balance. Also, let's not forget that freelancers often work remotely, eliminating the need to travel because of work. GIG-LING WORKERS OR DISMAY It’s the time to buckle up since the gig economy is here and is on the rise. Companies will have to mould their operational strategies around this new way of working. The traditional 9-5 jobs will see the rise of contractual and short-term work. The avenues for contractual work will expand, more so digitally. However, at this stage, it still seems difficult to say whether the traditional approach to work will completely be overturned. After all, the job insecurity and mental pressure attached to the field of gig work could become reason enough for someone to keep their 9-5 job. There is no doubt that the gig economy will grow; the future looks bright, but then will it be a gig for a day or a salary for a month? Or will the pros of the gig economy far outweigh its cons? Author: Kashish Rajput, Piyush Malik Illustration By: Hemanjot Singh Source: EconomicTimes Times of India India Today ThePrint

What proudly stands now as the biggest coffeehouse and the third largest fast food chain in the world once almost did not see the light of day. Years after its inception in 1971, Starbucks was treading the narrow roads of success when it virtually hit rock bottom. Creating the concept of a 'third home', Starbucks sprung higher than ever and has never looked back since. Offering the Nirvana of time away from home and work, Starbucks is a haven for a perfect escape to live in the moment. Starbucks started its journey to revolutionize the coffee industry when it first opened its door in Seattle, Washington, United States. Igniting the vision to reality, Jerry Baldwin, Zev Siegel, and Gordon Bowker sow the seed of what would accentuate the coffeehouse mogul today. The company traversed into the hands of Howard Schultz in 1987 when he bought it for $3.8 million. The coffeehouse solemnized with success in its initial days until a gloomy sky formed to rain on its parade. Cloudy with a chance of failure The sight of the green Siren with her long, wavy hair instantly transports one to wonder about the accolades of the company, but none catch glimpses of the starry nights along the way. Starbucks has had its share of failures to reel out. Despite the ubiquity of the coffeehouse across the globe, the $113.86 billion valued company doesn't seem to thrive in the land of down under. The Seattle-based chain that started during the 2000s slowly grew to nearly 90 locations by 2008. Its attempt to expand in Australia was shunned despite the continent’s deep love for coffee. By the end of 2008, the company had to shut down 70% of the underperforming locations leaving only 23 stores across the continent. To make things worse, the quality of the product and service and the inability to adapt to the customer's needs were highly criticized. Sales fell and the stock price dropped from $37 to $7.83 without the creative leadership on coffee. Additionally, the business had to close 977 locations and lay off 18,000 workers all thanks to the Great Recession of 2008. The reputation of Starbucks was in utter disarray. All adds up when the company tries to one-up its performance without taking into account the need to develop Starbucks' appetite for its consumers. They rapidly expanded the empire without slowly integrating the people's needs, leading to self-cannibalization among its different outlets. The magical song of the Siren Grandes on the table and laptops back into the store, Starbucks gained its fans back. Everybody deserves second chances, and Starbucks created something people can’t forget! It collected all the scattered pieces and cracked the code to solve this puzzle of failure. Quality and experience, are two things that separate a Starbucks drink from any other cup you have in your hands. Starbucks focused on these two aspects to rebuild the lost empire. The return of the old CEO, Howard D. Schultz had the coffee brand stand on its feet again. Schultz had the company focus its attention back on the customers and all the pieces started to come together. In March 2008, Starbucks rolled out a “my Starbucks idea” to collect customers' opinions regarding the improvisation of the services offered by the brand and also to connect with the population. It implemented some ideas like the introduction of frappuccino, the free wi-fi on a comfy chair demands and a lot, bonded with the folk, and gained the loyalty of the customers - its greatest asset. The recession was a huge blow to the brand; profit declined by 98 per cent over the fourth quarter of 2007, and the magic was fading. But a wave of Howard’s wand gets the ball rolling up north. The strategies implemented by him put the graphs at the tavern. The sales increased from a low of $5.4 billion in 2008 to around $9.8 billion in 2009 and the song of the green siren started working its magic again. The brand focused on creating a bond with the customers through the social media handles, “keep calm and have coffee” and the customer walks out of the store with a satisfying Starbucks cup in his hand. It introduced various snacks and coffee desserts and a cup to give as a gift, Starbucks created a luxurious world for its customers and was rewarded for the same with soaring profits. The way of coffee The vitality of Starbucks has widespread across developed nations. It has become so popular that it is now considered bad luck to start the day without a cup of coffee in hand. Starbucks has truly established itself as a purveyor of the greatest coffee in the world, gaining this coffee hustle culture in both developed and developing nations. While all of this looks like plain sailing on paper, there indeed exists a time when Starbucks was spinning its wheels. They faced the music, danced to the beat, and made it to see the light at the end of the tunnel. Author: Mananpreet Kaur Uppal, Hausianmuan Samte Illustration By: Keshav Sharma and Piyush Malik

Loaded with bullion by the dozen, multi-billion companies have constantly made headlines for paying a king’s ransom on the buyback of their shares. Excerpts from history show that $467 billion by Apple, $201 billion by IBM, and $60 billion by Microsoft were spent on one particular thing; buyback. The repurchase of company shares reached nearly $1.15 trillion in the first quarter of 2022. Paytm’s proposal to buy back its shares with an approximate outlay of $127.4 million (Rs 1048 crore) will set this fire ablaze. On the face of it, buyback by a profit-making company is little to no wonder but can be a calamity reaper for a company operating at a loss like in the case of Paytm. Let us dive into greater depths to see why. The tip-off Stock buybacks or share repurchases are a part of the corporate action taken by companies to buy back their outstanding shares in the stock market. This helps the company to increase the earnings per share, reduce the number of shares available and improve its balance sheet. The cost of a share must rise in tandem with the rise in the company’s earnings per share. Companies might use the available cash reserves, take debt or issue more stock to fund them back. Shareholders can choose to sell their shares or keep them by accepting the company's offer to acquire them at a premium. Buybacks are a calculated ripple effect. It spreads all over the map affecting the prices of stocks, market sentiments, and everything everywhere. While it can be an artificial attempt to boost share prices, companies can deploy it as a scheme to mask any underlying financial problems. The buyback process seems straightforward in black and white, but its application may leave one in black and blue as it is quite a behemoth of chaos that demands utmost understanding. Leap in dark Buyback has always been associated with assorted emotions. Some buybacks raise major speculations as they could be controversial and potentially harmful while they might also be cordially welcomed as beneficial tools for companies. But occasionally, there is a covert agenda. In 2012, Reliance Industries executed a brilliant manoeuvre with its share buyback plan to repurchase Rs 3,900 crore of shares from public shareholders. Despite falling short of its goal, the buyback was a resounding success. The company's decision to buy back shares at Rs 870, amidst underperforming shares, spoke volumes about its confidence in the stock's future potential. Shareholders were able to cash in at a premium, while those who believed in the company's vision were richly rewarded. While in 2011, BHP Billiton was at the peak of its glory, a behemoth in the mining world with booming earnings and a jaw-dropping $12 billion in operating cash flows. The company's move to initiate a massive $10 billion buyback program seemed like a no-brainer but little did they know, the tides were about to overturn. The commodity cycle turned for the worst, causing prices of iron, copper, and coal to crash, and BHP's prospects to plunge. While some lucky shareholders tendered their shares and walked away with cash, those who believed in the company's long-term potential were left to suffer. One year later, BHP's Total Shareholder Return had plummeted to a dismal -22%, leaving shareholders feeling the burn. The buyback proved to be a double-edged sword for BHP and its stakeholders. Paytm days are numbered? Paytm has always been on the top 10 list of companies with the worst bottom line. With the company being barred from taking new customers, it is akin to losing with troubles being temporary interruptions in their way of life. Having a consolidated loss of Rs 2,396 crore in revenue, its proposal to spend Rs 850 crore on the buyback of shares at a premium of 52% has raised eyebrows. The hop on the trend by the loss-making company after Infosys and TCS raised many speculations as they neither have enough money to sustain the buybacks nor to focus on their business growth. The company's intention to repurchase its shares at Rs 810 apiece which is 52% over the stock's existing trading price of Rs 529.90 is a tight grip on the company’s reality. While Infosys and TCS's buyback program provides its shareholder with relief which is projected through huge amounts of cash, the debt-ridden Paytm’s gesture to gimmick seems impractical. Moreover, its statement to not use the proceeds from its IPO towards the repurchase endeavours makes it a Sisyphean task. The mismatch While a buyback could stem the rout in Paytm shares at least temporarily, it puts the company on the other side of the fence. The open market method adopted by the company with the hopes to raise the trading prices of the shares failed to work albeit expectations. Had it opted for the tender route, shareholders can tender their shares for buyback at a fixed price set by the company. Its stance to showcase that the current stock price isn’t a reflection of its value draws further scepticism. Startups like Nykaa, which offered a 77% yield to shareholders when it went public, saw their stock prices plummet after Paytm`s demise. Moreover, on the listing day when Paytm's stock fell from its IPO price of Rs 2100 to Rs 1500, the stocks of new-age startups like Zomato fell and haven't recovered since. Even founders of unlisted companies like BharatPe commented that Paytm’s missed opportunity has caused the startup market to get into a state from which it may take a decade to recover. Paytm was the blue whale meant to bring about a significant change in the Indian startup industry. However, its IPO not only failed but also caused the entire startup market to crash. Many investors started blaming Paytm for the falling valuations. Remnants of the present Despite the uncertainties regarding Paytm’s buyback, there are suggestions that there might be a glimmer of hope which may bring a positive bull run in the company's share. However, statistics show a bleak future might await the company as the price offered in the buyback is still lower than 65% of its original IPO valuation of Rs 2150. Paytm buyback is a historic move that will impact the entire industry for years to come. It could lead to the bursting of the startup bubble or the resurgence of IPOs in the market. Shareholders can opt out or wait for the stock to gain momentum from this move. But one thing is clear, this strategy has raised eyebrows and the novelty of Paytm's consistent attempt to use multiple systems to revitalize itself. Will this strategic move by Paytm to rejuvenate in the market add fuel to its dim-lit reputation or will channel the flow of its erosion from the market? Author: Hardik Jain, Arhaan Aggarwal Illustration By: Muskan Bansal

Budget 2023 opens the gates for India to an ‘Amrit Kaal’ (path to the next glorious 25 years). Although independent for 75 years, India suffers at the hands of poverty and poor economic infrastructure which the 77th union budget aims to provide a remedy for. This year’s budget is a vision for the next 25 years which aims to strengthen the nation in terms of technology, knowledge and public finance. In a nutshell, it is another move towards the making of Atmanirbhar Bharat (self-reliant India). The economic agenda for achieving this vision focuses on three things: first, facilitating ample opportunities for citizens, especially the youth; second, providing a strong impetus to growth and job creation; and finally, strengthening macro-economic stability. ECONOMIC ODYSSEY The Indian economy contracted by 6.6% due to the global pandemic but started a mild recovery from the second quarter of the last fiscal. The rise in demand for services has led to a gradual increase in the IT sector. Domestic demand symbolised as private final consumption expenditure has shown a gradual improvement, growing on an average of 7.4% in post-covid duration. The Indian economy was strained by the Ukraine war, worsening India's growth-inflation mix. In addition to the already rising price of wheat globally, it pushed up our import bill for both energy and fertilisers, thus contributing to the rising inflation of about 8.39% and lower growth for India. Owing to such a rise in the prices of the commodity market, including gold, the equity market turned volatile. While the Ukraine war has put a strain on India’s economic prospects, the same war has also created a vacuum in the grain exporting market. Potential opportunities in telecommunication and the aviation industry present themselves, ready to be exploited. The US-China trade tensions resulted in numerous opportunities for south-east Asian nations, waiting to be grabbed by India. With so much affecting the nation’s economy, will the budget comply with the foundation laid in the previous budget? Being the last budget before the upcoming union elections, is this a bold political move? BUD-GET THE BUDGET In the 75th year of our Independence, the world recognised the Indian economy as a ‘bright star’. This Budget hopes to build on the foundation laid in the previous year, where a prosperous and inclusive India is envisioned, in which the fruits of development reach all regions and citizens, especially our youth, women, farmers, OBCs, Scheduled Castes and Scheduled Tribes. The fifth Union Budget’s take on the daunting dilemmas of the nation’s economy is one to look into. Education The budget scores Grade A in its allotment to the education sector as its allocation increases to ₹1,12,899.47 crore, by around 13%. This is the highest-ever allocation to the education sector, paving the way to transform India into a “knowledge-based economy.” The highest share from the education kitty was, as per the convention, allocated to the school education department at ₹68,804.85 crore, allowing the PM Poshan Scheme to shift gears. At the same time, the higher education segment received ₹44,907.62 crores, which will help boost the funding to several central institutes. Overall, the Union Budget 2023 unveils some key actions to overcome the learning losses of the Covid-19 pandemic, fueling the digitization of education and driving uniform delivery of education in the country. These announcements are expected to fast-track the implementation of NEP 2020 and achieve its end objectives. Despite this, considering the overall share of education in the pie, it is quite conclusive that the larger goals are still distant. Infrastructure Reinforcing the importance of infrastructure, the government has included ‘Infrastructure and Investment’ as one of the seven priorities. To further the infrastructural development, the Union Budget, for the third consecutive year, has proposed to raise the Capex by 33 per cent to ₹10 lakh crore and a continuation of a 50-year interest-free loan to state governments to incentivize infrastructural development. While infrastructural expenditure has risen, it still only accounts for 3.5% of the GDP. Is this allocation enough to keep up with India’s lofty goals for economic growth? Investments in infrastructure and productive capacity have a large multiplier impact on growth and employment. After the subdued period of the pandemic, private investments are growing again, doubling in the last quarter. The budget takes the lead once again to ramp up the virtuous cycle of investment and job creation. Boost to green mobility The budget supposedly aims to further India’s path on its destination towards 'panchamrit' (five-commitment plan) and net-zero carbon emission by 2070, to usher in a green industrial and economic transition. The budget provides ₹35000 crores for private capital investments towards achieving the same. Custom duty exemptions are being extended to the import of capital goods and machinery required for the manufacture of lithium-ion cells for batteries used in EVs, providing the impetus to green mobility. The government’s clear indication of green growth as a pillar of development is a welcome move. Healthcare Being the first budget after COVID-19 became endemic in the country, one would have expected a little more focus on the health sector. This year's budget is said to be futuristic with a focus on medical research and paves the way for achieving universal health coverage. Some key proposals include the opening of 157 new nursing colleges and dedicating multidisciplinary courses for medical devices. A new program is also launched to promote research in pharmaceuticals. The government has proposed to work in a mission mode to eliminate sickle cell anaemia by 2047. The walls of the parliament echoed with loud claps on 1st February 2023 by being very optimistic about the fact that the world is not going to face another pandemic anytime soon, but what if there is a different story being written in the bigger picture? Agriculture The agricultural sector, the most significant source of income for the central and state governments, is usually referred to as the powerhouse of India owing to its vitality towards economic growth. This year the government has aimed to build accessible, inclusive and informative solutions for farmers. A new Horticulture Clean Plant Project, to boost the production of high-value horticulture crops, is to be launched. A concrete step has been taken to make India a global hub for millet. The agriculture credit target is to be increased to INR 20 lakh crore with a focus on animal husbandry, dairy and fisheries. A new Agriculture Accelerator Fund is also set up to encourage innovative agri-startups by young entrepreneurs in rural areas. Taxation In a country where almost 88 lakh crore rupees are unregistered, i.e., black money, the general public is not as concerned about the reduction in their tax liability as they should be due to the new tax regime. Instead of having the 7 tax slabs ranging ₹2.5 lahks each in the old tax scheme, the government now divides the income into 6 slabs with the division unit being changed to Rs. 3 lakhs as a part of the new tax scheme. Furthermore, the rebate limit has been extended to Rs. 7 lakhs. But will this change truly provide a sigh of relief to the public? Due to the extension of the rebate limit, a significant proportion of the population will be exempted from personal tax. In addition to that, the difference of Rs. 50,000 between the slabs will also reduce a significant percentage of tax for the lower income groups. Over the years people chose the old regime over the new one, but the modifications made in the new regime in the budget 2023 will turn the tables. For the first time, the benefits reaped by the new regime will outshine the old ones even after availing due deductions. Hence, it is expected that taxpayers will shift from the old to the new regime. Conclusively, the presentation of income tax, in the end, was like a dessert. But is the budget considering the loss in government revenue and the resulting increase in expenditure? Considering the tax and other major steps taken in this budget, how far will the economy go? Author: Priyansh Kotiya, Riya Sethi, Palak Bansal Illustration By: Jasmehar Kaur and Kashish

“You’re purchasing stuff that you don’t need, with the money you don’t have.” Imagine a world where you don't have to choose between your wants and needs. A world where you can have your cake and eat it too. A world where you can buy that Jordan pair you've had your eye on or that new gaming console you've been dreaming of without breaking the bank. It seems to be a paradise to live in, but wait, could a devil be lurking in a corner? Consider a situation where you find the latest edition Jordans. You are keen to buy it, but you neither have enough bank balance nor a credit card. Subsequently, you search for an alternative payment method and use the BNPL feature. Through this, you pay a small down payment on the shoes and the remaining price in instalments. The BNPL setup offers the superpower of easy credit with no (or minimal) paperwork and also often requires little to no credit checks. Thus, credit is now accessible to a wide range of consumers, including those with a poor or no credit history. Hence, using BNPL exposes them to numerous business prospects while granting them a luxurious lifestyle. Thus, regardless of their credit score, people can fulfil their desires of a rejuvenating vacation, branded shoes, or the latest iPhone. Emergence of GENZ credit line The credit card industry in India is limited to only 3% of the total population. Furthermore, Indian customers have always been hesitant and careful about obtaining any form of a credit line. The younger generation who are prepared to take the advantage of easy credit is not eligible for the same. This is due to stringent requirements, including an average salary of Rs. 1.44 lakhs, a solid credit score, and extensive paperwork. The BNPL companies decided to fill this gap with the concept of micro-credit. These companies typically earn their profits from the interest charged and the penalty paid by their beneficiaries on account of deferred payments. Certain service providers such as Slice, ZestMoney, and Lazypay also charge retailers a small fee for allowing their customers to pay for their purchases using the feature. Furthermore, certain BNPL providers earn revenue through partnerships and collaborations, such as offering additional financial services or rewards programs. The pioneer of this model in India was Paytm - a digital wallet and e-commerce platform. It was the first company to introduce BNPL through Paytm Postpaid services in 2016. Subsequently, PhonePe in 2018 and Zest Money in 2019 followed the trail. The BNPL feature was marketed not as a form of a temporary loan but as a tool that allows its users to lead a good lifestyle at an affordable price. Owing to this perception among the public, experts predict that the BNPL industry will reach a market size of around $50 billion and a user base of around $90 million by 2026. The tail or the tale ? The ability to defer payment and dice it into smaller pieces does sound appealing. However, it also results in impulsive purchases that disbalance an individual’s budget. When repeated, the act becomes a habit, and the person ends up in a debt trap shouldering a high credit risk simultaneously. According to the reports, 15% of people in Australia and 33% in America take out loans to pay off their purchases using BNPL. In India, experts have raised concerns about similar trends. As the market continues to grow, the potential effects of BNPL on consumer debt also increase. Thus, it can be concluded that BNPL with just the right regulation pertaining to transparency and credit issuance can change the face of the planet. In India, RBI, while keeping up with the basic features of BNPL cards, has set guidelines that prevent non-banks from using credit lines to load their prepaid instruments; instead, they can only do so with cash, bank or credit card accounts. Partnership with Technology BNPL companies are increasingly using Artificial intelligence (AI) to improve their operations. Appealing features such as predictive analysis, automation, fraud detection, and credit scoring are all using AI. Additionally, AI is an effective tool for modifying the consumer experience. It provides tailored recommendations and offers based on the customer's browsing and purchasing history. Slice, an Indian fin-tech start-up, has already started integrating AI and data sciences with its business model. The company aims to innovate and differentiate itself in the BNPL market by providing a seamless and user-friendly experience using technology. One such innovation includes the program that calculates the power of the consumer’s purchasing for each transaction based on their credit history (to ascertain whether to issue a credit or not). Slice also has launched a digital wallet feature, which allows customers to store money in a virtual wallet and use it to make purchases on the platform. Is there a better alternative? The BNPL model is in complete turmoil, thus the consumer is back to square one as to how to fund his lavish lifestyle. Why not go back to the old-school way of saving first? To compete with the BNPL model, Multiple, an Indian company, has developed the Save Now Buy Later (SNBL) model. In this model, the consumers are offered a variety of savings and investment plans like investment portfolios and cashback rewards. These plans help consumers save money over time so they can afford to make larger purchases in the future. It also partners with retailers to offer deals and discounts to customers. BNPL and SNBL are two different but equally functional solutions to the same problem, the dilemma of living a better lifestyle with limited income. BNPL can provide immediate access to goods but can promote overspending and lead to a debt trap. It becomes practical to prefer the model in situations where one wants to make relatively small ticket purchases like apparel, dine-out and in general shopping; given that one doesn’t overextend their budget. SNBL, on the other hand, promotes good financial habits of saving first, but it may take longer to make a purchase. Thus, SNBL should always be preferred in big-budget purchases like planning a vacation, so as to not make a big dent in one’s pocket. The Final Verdict: Convenient or Concerning? One cannot emphasise more on the fact that it is extremely crucial to not overextend your budget using the BNPL feature. It’s important to remember everything comes at a cost. Like with any form of credit, it's important to make sure that you can afford the payments and that you understand the total cost of the purchase, including any interest or fees. More consumption in the present only implies less consumption in the future and that’s something to think about! Reference CNBC Investopedia Financialexpress Author : Sehaz Nagpal, Purav Tayal Illustration By: Hardik Mukhija

Whenever an earthquake strikes, it leaves behind the threat of aftershocks which can be devastating. A slight movement in tectonic plates can cause serious destruction. But not all shockwaves originate beneath the earth. They may not cause buildings to collapse or roads to crack, but they can still cause misery. Europe which consists of four out of the ten biggest economies in the world spent almost a whole year fighting such waves, which economists call inflation. The Eurozone and the European Union went through an economic recession in 2022. The consumer price index in countries with the euro as their currency rose by a record 10.6%. What could be the reason for such a constant rise? The sharp rise in prices can be mainly attributed to the war in Ukraine, disrupted world trade and supply chains, and the gas and energy crisis. Europe faced an energy crisis due to its retributive cutting of 80% of Russian gas used for heating, industrial processes, and power. This caused a 15-fold increase in the wholesale price of gas and electricity, which lifted the CPI to unexpected heights. Merry Christmas The last two months provided some relief to the policymakers. In the same 19 European countries that use Euro as their official currency, while the prices were at a record high at 10.6% in October, they dipped to 10.1% in the month of November and further plummeted to 9.2% in December. This fall occurred mainly due to slowed energy price growth i.e. prices which were actually the fundamental cause of European inflation increased but at a decreasing rate. The fall in gas prices can be attributed to abstinence in consumer demand and sufficient buffer of fuel in storage facilities across all of Europe, which was prepared in anticipation of the approaching winter. The Road Ahead Although these two months went well, the road ahead doesn’t seem easy. As per the numbers and analytics, the overall inflation has slowed down due to the fall in energy prices. Energy being a significant driver of inflation has allowed the continent to win from low global demand for gas, which was partly because of China’s zero covid policy. China’s economy began reopening and is likely to require more energy soon. Hence, gas prices might soar leading to an inflation rise. But on the other hand, covid cases in China are again on the rise which may affect the markets again. Will China spoil the party for Europe? Keeping aside the external threats, internal conditions may add to the cause as well. Talking of the tight labour markets, wages have accelerated. Be it the increase in the minimum wages in some countries or compensation for the rising living costs, labour markets have caught worldwide attention. Trade unions are negotiating pay rises more and more assertively. For instance, in October, the German union IG Metall began warning strikes demanding an 8% wage increase for more than 4 million workers. This wage rise can have negative consequences, as further wage increases may prolong high inflation or even cause a wage-price spiral, which happens when three out of four consecutive quarters face accelerating consumer prices and rising nominal wages. This will create a prolonged loop in which inflation will lead to higher wage growth, fueling even higher inflation. Finally, to fight the soaring energy prices which are causing an increase in people's cost of living, Europe is spending €705.5 billion on energy subsidies. The total Energy subsidies in Europe were just €184 Billion in 2021, indicating a jump of 380% in just one year. Till now European policymakers have responded by suppressing energy costs through subsidies, tax cuts and price controls, which can delay the necessary adjustments to an energy shock by reducing incentives for households and businesses to conserve energy and increase efficiency. This can ultimately result in higher global energy demand and prices. Alternative measures such as implementing energy efficiency policies, investing in renewable energy sources, and promoting conservation efforts can help address the energy cost surge in a more sustainable and long-term manner. Fiscal policies by ECB regarding stimulating the economy through government spending and interest rate cuts over the last whole decade are questionable, as now it would overheat the economy because it has no spare production capacity. If an economy has reached its limit of output that can be produced but still grows, any further growth or stimulation of this economy would lead to inflationary pressures. Considering such policies, the question arises that whether the war was a cause or just a trigger. A Plausible Remedy Policymakers worldwide should consider the risk, that fiscal policies aimed at protecting households from escalating energy costs can also act as a catalyst for inflation. If they are too broad and long-lasting, they might fuel consumer demand all across Europe. There are multiple signs that indicate that Europe’s economy will perform better than expected, including its relatively strong labour market. But how bad things can get if it doesn’t, still remains a question. The risks of the hovering inflation can also encourage the Central Bank to sound resolute in its plans for higher rates. The philosophy of raising interest rates will prove to be fruitful in the long run, as long as it is kept under control. Rampant interest hikes, on the other hand, might further add to the possibility of a recession due to reduced consumer spending. When the inflationary bars are at par with the Eiffel tower, will the continent have a gloomy picture of the future or the lights will shine brighter than the present? References: IEA IMF Blog The Economist International Monetary Fund Authors: Priyansh Kotiya, Madhav Bhatia Illustration By: Prateek Verma

An extra penny spent? A lot more than that! When rational consumer behaviour is put to test, and the most important assumption of economics fails, that’s when the decoy effect comes into play! A consumer stepped into a McDonald's store to have small-sized fries priced at $1.39 knowing that this was his utility-maximising choice. McDonald's introduced new medium-sized french fries priced at $1.79. What did the “rational” consumer choose now? Large fries (priced at $1.89) are worth only 10 cents more than medium fries and thus, he is forced to reconsider his choices. With a 40 and a 10-cent difference between the two options, paying 10 cents extra doesn’t seem like a huge ordeal. He ends up buying the large-sized french fries and at the moment, this choice provides him with maximum utility. What just happened? The Decoy effect fooled the “rational” consumer! What caused a change in the preferences of a rational consumer? The consumer was stern that his utility will be maximised when he consumes small-sized french fries but the company tricked him by introducing a decoy, the medium-sized fries! The 10-cent difference between medium and large influenced the consumer to go for the large size, the target. He walks out of the store blindfolded with a smile. The attraction effect can be witnessed in almost all industries now. From extra dollars being spent on a Starbucks grande to defending your choice for buying an expensive iPhone pro max, the decoy is everywhere. One less dollar in your pocket! Though the decoy effect is a friend of the companies, it’s phoney for the consumers. It induces consumers to spend more. A consumer, most of the time chooses an expensive product when a decoy is present. This sometimes shakes the entire budget of the consumer and everything the consumer had planned for a specific time period. Let us prove this using a hypothetical example. You have a normal iPhone 14 and a Pro Max model, what is the model you’re going in for? An iPhone 14 would be a preferred choice as stated by a number of rational consumers. What happens when a Pro model comes into the picture priced at a level that is much more than the 14 model and a little less than the Pro Max model? Sales for the Pro Max variant increase as a result of the introduction of the decoy, and surveys give out the same result. You intended on spending less and ended up exceeding your budget but you’re satisfied. Does the satisfaction last long? When you can no longer afford AirPods because of your choice to purchase iPhone pro max, you won’t be satisfied in the long run. Thus, the decoy posing a threat to rationality takes the trophy here. A trade-off has been made, you decided to invest your dollars in the Pro Max model instead of spending them on the iPhone 14 model and the AirPods. The decoy effect demands the consumer to make tradeoffs between the goods in the picture and does it actually have the consumer leave the store with his optimal bundle? A may in the short run and a may not in the long. Chase two things, lose the one! The phoney has done its job. The choice that you thought was optimal was advantageous for you, not optimal. Only at that particular moment with a constrained budget, the large popcorn bucket provided maximum satisfaction. In fact, having to justify one’s choice increases the decoy effect, as the focus of the decision is shifted from a selection of good options to a choice of good reasons for selecting that option. A may or may not story If a customer goes to a Starbucks store for the first time, the decoy effect will work on him. But if a person knows that a tall frappuccino is his satisfactory drink, he won’t be affected by the prices and hence the decoy effect fails here. When a consumer prioritizes quality over price, or the consumer is loyal to a brand, all that effort made into pricing the products pays back nothing. An eye on ‘the target’ Where should the decoy be placed? A number 1, 2 or 3? For the decoy to work, the dominant relationship between it and the target product needs to be obvious. Let’s take an example of this. A TV manufacturing company has priced a 24-inch LED at $356, a 32-inch LED at $442 and a 36-inch LED at $467. Interpreting the simple definition of the decoy effect, we know the consumer’s dollars are going in for the 36-inch LED. But what if there was a 28-inch LED priced at $409 in place of a 32-inch, what would have been the ultimate choice? a 24-inch LED would be the optimal choice here. The decoy is introduced to increase the sales of the target but the target varies in both these cases, Situation A is created to maximize the sales of the 36-inch LED whereas the target in situation B is the 24-inch LED. For Decoy to play its part as a friend and a phoney, the companies need to know about the customers and have the target product marked. Can you win your rationality back? No game is played with just a single team! The definition says that a rational consumer wants to be satisfied while spending less. The answer’s in the definition itself! A list of sorted priorities may help the consumer to avoid walking out of the store after being fooled by the phoney. The play here revolves around the preferences of the consumer. If I know, a small coke is enough to satisfy my thirst, the presence of the decoy won’t affect my choices. I will be satisfied with my choice because I haven’t been fooled by the phoney for an extra penny. The decoy effect boosts the sales of the companies but at the cost of the utility obtained in the long run by the consumer. Is the trade-off worth the chaos? Author : Mananpreet Kaur Uppal Illustration By: Chiranshi Dua

It was 2005, the housing market in America was booming and Michael Burry had begun his analysis of the mortgage lending practices in the USA. While this was happening in America, in India, it was the time of birth of one of the largest jewellery chains in India, PC Jeweller PC Jeweller was an idea conceived by siblings, Pramod Chand Gupta and Balram Garg. What started as a stand-alone jewellery shop in the busy markets of Karol Bagh in Delhi, soon raised an empire of its own. Gradually yet steadily it added more stores and set up production establishments for exports, wholesale and retail purposes. PC Jeweller could ride the winds of success owing to the changing preferences of the Indian shoppers who started taking an interest in the organised jewellery market. Noticing the favourable business environment, PC Jeweller launched an IPO in 2012 and was able to raise Rs. 600 crores and at that time, it had only 20 stores. However, all that glitters is not gold. Ever since Jan 19, 2018 PC Jeweller hasn’t been able to shine as it did before. While in 2018, the company’s shares were being traded at around Rs. 600 a piece, it took just 2 years for it to fall from grace, with the shares being traded at a mere price of Rs 8 back in March 2020. The crisis PC Jeweller tasted the dust of defeat owing to the greed and manipulative nature of its promoters. It got mixed in with some bad apples and lost its appeal in the court of public opinion. A web of lies The lies began when Vakrangee, a Mumbai-based financial and technological company bought 20 lakh shares worth Rs. 112 crores on 25 January 2018. One would expect that such a block deal would be reported to the securities market, however, no such declaration was made in any of the exchange filings regarding the seller of the shares. Although PC Jeweller clarified that no promoter had to offload their shares in the market, it only bred ground for more speculation. Vakrangee told Bloomberg Quint that its investment in the jewellery company was a treasury investment which was made based on the future potential of the jewellery company. At that time Vakrange was under heavy scrutiny by the SEBI which alleged the company of price manipulation of its own shares. Later, on January 30, Vakrangee issued new treasury guidelines prohibiting the company from owning a direct equity stake in any company. In coherence with the new guideline, the company had to offload a significant amount of stake in the PCJ, which subsequently led to panic selling causing the share to tank as much as 60% in intra-day trade. The incredible Jeweller The lies continued as investors started to get concerned over the “quality and timeliness” of the disclosures by the company. There were concerns that promoters of the company were “gifting” their stake in the company to their relatives via off-market transactions. Even though the firm reassured its investors that it would make requisite disclosures for the same from time to time, it did nothing to assuage the public’s loss of confidence in the company. Another blow was struck to the company in May 2018, when the market regulator, SEBI found four individuals guilty of insider trading (an act of trading on the basis of unpublished price-sensitive information). The individuals concerned were Balram Garg (Promoter), Amit Garg (Balram’s nephew), Sachin Gupta, and Shivani Gupta (son and daughter-in-law of the company’s chairman, late PC Gupta). As a result of these charges, SEBI imposed an aggregate fine of Rs. 1 crore on the guilty and barred them from trading in the shares of the jewellery company for 1 year. It became difficult for the public to believe the announcements made by the company. Thus, it was again disappointing when the company withdrew the buyback announcement to purchase shares worth Rs. 4245 crores from investors. The buyback announcement was repealed because the company failed to obtain the NOC (No Objection Certificate) from its bankers, which only further led to the decline in the stock price. The future The company’s future is not as shiny as the gold it uses to manufacture its products. With the fine imposed by SEBI on Balram Garg and his family on account of insider trading, the company has lost all credibility in the market. Furthermore, due to the multiple instances of banking fraud committed by the country’s top jewellers, Nirav Modi and Mehul Choksi, the jewellery sector in India is expected to remain dull for some time at least. Currently, the stock trades at around Rs. 98 per share. While the stock is fundamentally stock, it is the shadow of the top level management of the company that has been preventing the stock from reaching its full potential. Now that the company has made significant progress in resolving its differences with the regulating authorities, right now is the perfect time for the company to make a turnaround. Author: Neeraj Agarwal Illustrator: Tanmay Choudhary

From being on every TV screen to struggling to find a space in the industry it owned at a point in time, let us decode the downward-sloping graphs of Dish TV, an old hero in the DTH industry! In the world of Android televisions, Dish TV seems to have gotten lost in the crowd with its share prices dropping below INR 20. Established on 2nd October 2003 as a part of the Essel group, Dish TV ticked off becoming the biggest DTH network in Asia with a family of 10 million subscribers by February 2011. Launched by the Zee network, with Mr Anil Dua serving as the CEO of the company, it had acquired major DTH networks like d2h, etc., and saw consistent growth in the decade of its birth. But sometimes, the graphs tend to slope downwards after soaring so high. 2016 was a prick in the eye, henceforth things started to get worse for the service provider. Will Dish TV be able to stand out in this smart crowd or will it be the name of a past? The Crisis: Dish TV was a huge market player till 2016, but the subsequent quarters saw a sum of liabilities overpowering the worth of assets. What could have been the reasons for such a drastic decline? Struggle to get a Signal With Tata Sky and other service providers entering the DTH market, Dish TV lost the tag of being the hero in the market. Share prices declined by 39% from being as high as Rs. 118 in August 2015 to Rs. 72 in February 2016. If one wants to catch a big fish, one needs to throw in considerable bait. But what if there is no big fish present in the pond? All that risk is worth no gain. Because of its declining stock prices and the innovation brought in by the new brands, Dish TV started bleeding out customers. Moreover, with online streaming platforms entering the market and becoming popular during the pandemic, Dish TV started reporting huge losses. In the Jan-Mar quarter of FY 2022, the company booked losses as huge as Rs. 2,032 crores and its revenue declined by 14.5% to Rs. 642.70 crores. Blackouts: fight for the stake Dish’s rivalry with Nexstar, a TV station led to history’s largest blackout (3 weeks) in the DTH industry with more than 160 channels showing a “NO SIGNAL” error box on Dish’s subscribers’ screens. And no one was going to wait to watch their favourite TV show for this long, not for three weeks at least! What's dramatic is that although Yes Bank holds approximately 25% stake in Dish TV, it has engaged in a tussle of power with the Dish TV officials. In the past, the Essel group founder, Subhash Chandra had borrowed a tremendous amount of over INR 5000 crores and pledged his stake in Dish as collateral. Due to his inability to repay the borrowed amount, the ownership of pledged shares was transferred to the officials at Yes Bank. The founders wanted to take away the bank's voting rights but lost a court battle for the same with Yes bank voting out the 2 major members from the board of directors, making the matters worse for the founder, Subhash Chandra but better for Dish as a brand. There was a rise of 20% in the share price but the increase wasn’t enough. Power Cut: Management losing its strength We saw a surge in the share prices but the company is still lagging with only 2 members on the Board of Directors when at least 4 are mandatory. Yes bank has voted in favour of its representatives to be a part of Dish’s BOD. With Yes Bank on the board of directors of Dish TV, predictions and analysis show that the battle’s in the hands of Yes bank and Essel group is going to lose its stake in Dish. Will Dish ever reach the shore? (the future) Several negative points were on the screen within a few years. With share prices as high as Rs. 130 in June 2007 to as low as Rs. 4.25 in May 2020; will the future bring relief to the tensed faces or have them talk about the brilliance of the past when everything has finally come to an end? Dish is trying to be a competitor by adjusting to the changes with the innovations in the market. It released android set-top boxes to be a step closer to being in the smart circle where everything is available in a small TV box. With the launch of the 5G services, Dish TV has tied its fate with it and the software designed for the same has proved to be cost-efficient and can give Dish an edge over the competitors. As highlighted above, its consumer network is losing users, so Dish hopes that wholesaling its network's coverage, speed, and security for other companies' use will propel its future growth. The share prices have been showing up and down arrows but it surely has started to improve with an increase of around 75% from February 2020 to September 2022, yet it's standing so far away from where it began. With all that's cooking, we can only wait until we decide whether we will be served with a good 'Dish' or not. Sources: The Economics Times Business Standard Ndtv.com usatoday.com Author: Mananpreet Kaur Uppal Illustration by: Muskan Bansal

Background This is the story of Vodafone Idea, a David who could not beat Goliath. Vodafone India was a subsidiary of the UK-based Vodafone Group PLC, set up to bridge the gap between its customers and a better future by providing them with better digital services. In August 2018, it merged with another leading company in the telecom industry, i.e., Idea Cellular and rebranded itself as Vodafone Idea. Things started to fall apart for the company from the day Jio was born. In April 2015, Vodafone Idea had a market capitalisation of Rs. 729.2 bn, touching a low of Rs. 84.8 bn in November 2019, the current market capitalisation of the consolidated company stands at around Rs. 272.34 bn. But how did a lucrative company which was once worth billions of dollars fell from grace and is now being traded for Rs 9.05 per share? The crisis It was not one, not two but many crises that had a domino effect on Vodafone’s troubles. Following are the two major reasons that plagued the company. There’s a new sheriff in town Amidst the notable recognition of Vodafone India and Idea Cellular, these companies were inflicted with a serious crisis when a fresh competitor, Jio protruded above the veteran companies in September 2016. As a new force of wave surged over the market, the organisation, which was formerly two different entities viz., Idea Cellular and Vodafone India were merged as one to counteract the competition brought by their new rival. During its initial stage, Vodafone Idea was trading at the price band of Rs.50 - Rs.70. However, it didn’t take long for its stock price to fall to Rs. 10 the following year and subsequently, hit rock bottom when it traded as low as Rs 3.40. Although the merger awarded them with a comparative advantage of 38 per cent share in the total subscribers, the new prodigy would soon seize their market. Jio accumulated 35 per cent of the market share followed by Bharti Airtel with 29 per cent and left VI with 25 per cent. As a result, the company lost over 130 million subscribers and this was concurrent with the introduction of the 4G spectrum that provides fast connectivity. The notorious degree of competition and paper-thin profit margin wasn't kind to VI as well. While its competitors, Jio and Airtel, enjoyed a higher Average Revenue Per User (ARUP) of Rs. 124 and Rs 129, respectively, Vodafone struggled to stay afloat due to an ARUP of Rs. 108 per user only. The debt balloons Vodafone's tussle began way back in 2008 when they executed a deal overseas to acquire a controlling stake in Hutchison Essar at $11.2 billion. This led to a series of severe consequences. The tax department stated that the company should've withheld tax and issued a notice seeking Rs 11,281 crores later augmented to Rs 7,900 crore. Experts believe that this judgement had sealed the fate of Vodafone. The judgement brought about an unfathomable series of events that would drastically derange the company from its real potential. As a result, VI owes the government more than Rs 1.68 lakh crore as cumulative fees for AGR and spectrum and another Rs 23,400 crore as international debt by April 2023. As of March 31, 2022, the company was debt-ridden with total debts amounting to Rs 1,97,878.2 crores. Future It has been a spiral of unending problems for Vodafone Idea. The woes of the company multiplied when the Birla Group abandoned the company and sold its shareholding to the government on August 6, 2021. This further blemishes the faith in the company's future. The company has fallen into a cyclical nature of unending burnout of cash reserves and Rs 8,160 crore payment due over 12 months. Meanwhile, many analysts believed that only the government can revive the dying company by bailing out the company and revamping the AGR systems to relieve the weight of the company. So, it will be a test of time and the rules and regulations imposed by the policymakers whether Vodafone Idea will avert bankruptcy and find solutions to the problem to present a long-term plan for its shareholders. Another question to ponder is if the government of India will allow the Indian telecom market to transfer into a duopoly. Sources: Fortune India business line Business Standard The Economics Times Author: Hausianmuan Samte Illustration By: Tanmay Chowdhary

An apple a day keeps the doctor away, but does the Apple you read about on the internet, satiate your thirst, or does it keep you coming back for more? With Apple continuing to assert dominance over the tech market, they have been found guilty with tons of alibis proving them to be the finest. Nevertheless, a crucial question remains, How do they maneuver such a gambit? Hold tight, because you might be taken aback to realize that the answer is YOU. TWO APPLES IN A POD? With the launch of their new series of iPhones on 7th September, Apple made several headlines, in continuance with their tradition, leaving everyone chomping at the bit for the most awaited 14 series. While the internet is heated with arguments where some are claiming that there are little to no changes, Apple fanatics have come forward in Apple's defense to prove that the company has lived up to its reputation. Each main concern deals with the irrational decision to leave the 13 and go for the newer version. In financial terms, the new release persevered to witness a hike in the share prices by 3.9% due to the ginormous pre-orders the 14 series have garnered and already making it a success before the series have actually been released. It’s 14, but is it different? The internet doesn’t think so; the tweets don’t seem to overlook the minimal changes that the new series accommodates. A discreet being wouldn't walk the extra mile to get his hands on the 14 at an exorbitant price of $799 when the 13 version is readily available at his fingertips at a steal price of $699. WHAT’S THE DIFFERENCE? THEN HOW DO WE EXPLAIN THE BAFFLING APPLE FEVER? Simple. Apple deploys emotional advertising in its favour to ramp up its sales; Its pride band iWatch marketing strategy, black lives matter emoji, and other gimmicks act as a catalyst to captivate the minds of its consumers and presents an image that the brand cares about them. This instils an emotional unity of thought among its users. However, the 13 vs 14 debate can be concluded by stating that the result will leave Apple Inc. prosperous anyhow, regardless of whether people switched to the new version. At the end of the day, Apple creates a problem and solves that problem at the expense of your cost, while they keep the extra profits. CONSUMER BEHAVIOUR AND THE WALLED GARDEN Consumer behaviour is an ever-changing dynamic force, with improper fluctuations that can arbitrate with retrospect to the economic climate. Any simulation can easily deter the ingrained habits of consumers that could easily leave anyone bamboozled. The tech tycoon has no issues with tracing along the thin walls of their consumer behaviour. Humans seek and want superiority; they are willing to spend a fortune to get it. And Apple excels in doing precisely that. Their innovative and creative schemes lured people to taste a fraction of the perfect world they have framed inside the walled garden. Once in, there is little to no way outside the four walls. They are subject to a cycle of an ecosystem where apple products are only compatible with apple products, thus allowing them to thrive seamlessly in an unmatched environment. Apple builds its ecosystem strategically in a way that its products interact smoothly with one another. FaceTime, iMessage, and iPad, for example, are built with the ability that allows you to carry on your iPhone conversations on a tablet. The same was implemented as a new feature on the Macs in addition to supporting full phone calls. A habitual use greases the oil for a more effective and efficient performance among its devices. This ecosystem induces its users to ply along the inner walls of the ecosystem, without any fascination to try something different. REPACKAGING MODEL “Think Different”. Apple is living up to its tagline, but not in the way you might've speculated because its products say otherwise. Is this a sign that the iPhone has reached its peak? While the strategy of trapping consumers may work in their favour, it is evident that the company has reached its product peak from the minute changes in its new product. Each year, a new Apple iPhone and iWatch series are launched and its revenue is incessant. At the onset of its launch on 13 October 2020, the iPhone 12 was considered the ideal phone for any user. Everything was crisp; embodied all that you want in a smartphone. The subsequent release of the 13 and 14 are perceived as gimmicks of the 12, and one finds it difficult to tell them apart. Trying to justify upgrading is a handful. Then why are people going crazy over the launch of the 14 series? Because, it’s Apple; a symbol of class, repute, and finesse. The revenue graphs of the tech giant show higher and higher bars with the release of a new series of its products every year. Suppose, a user wants to upgrade to the new series today. What would the user do with the older iPhone? Sell it or in most cases throw it away. Millions of users may be doing the same. This generates tons of e-waste which harm the environment. In 2019 alone, $7.49 billion worth of raw materials were dumped as e-waste. As a global tech giant, whose primary focus is on producing planned obsolete goods rather than durable goods, Apple is partially accountable for this global issue. Is Apple imprudent to this global issue? Not necessarily, because they have adopted an exchange program as a part of their business model. This allows you to turn in your old phones for a company credit score and a discount on your next purchase of an Apple product. It also refurbishes and later re-sells them to earn a quick profit. Stats show that due to this recycling model, they recovered $40 million worth of gold in FY 2015. Apple benefits again! Create a problem, solve and market it; Apple’s way to wear a tech crown. THE REALISATION: SHOT ON IPHONE The launch of the 14 series has seen a wave of mixed emotions in the public, the revenues tell a story, and the technical tells a different one. But what really is all this 13 vs 14 debate for? It all comes back to us, our expectations from the tech giant. The 12 series was a whole new upgrade, the upgrade looked like one. The 13 looked different from the 12 series, the design, the features, once again, UPGRADE! Apple didn’t leave a chance to amaze us with so many technological changes in the series that followed in the past years. It led us to crave more, we expected it to add something different every time it launched anything new; forcing us to ask WHAT IS ENOUGH? It would be an understatement to say that expectations were high this 7th of September, and the iphone 14 proved to be a disappointment. If you have a free shot, you would upgrade to the 14th. But at the cost of your expense, will you want to upgrade to the 14th? With that being said, the appreciation the iPhone 14 fetched is an enigma that baffles everyone. Is this a certainty that Apple's consumers are lost within the labyrinth of the walled garden? Authors: Mananpreet Kaur and Hausianmuan Samte Illustration by: Muskan Bansal

BACKGROUND Who knew the world’s fifth largest wind turbine manufacturer would end up becoming a stock that’s not even worth Rs.10? What started as a textile company soon turned into a global energy provider that harnessed the power of the wind to provide electric supply to its customers, and later succumbed to crippling debt and the unpalatable ambitions of its promoters. The need for a quality uninterrupted power supply inspired a man named Tulsi R Tanti to bring into existence, Suzlon energy, in 2001. Tulsi R Tanti, a commerce graduate and a holder of a diploma in Mechanical Engineering, would later become the fourth richest Indian behind Premji, Ambani and Lakshmi Mittal with the listing of the energy company on the stock markets. Suzlon energy was listed on the stock market in 2005, with its shares being oversubscribed 51 times. The shares debuted at Rs. 692 a piece making Tulsi’s stake of 69.78% worth billions and the man, an instant billionaire. By 2008, both Tulsi and Suzlon were even bigger. It acquired the German-based Senvion and become the fifth largest wind turbine manufacturer in the world. All was going great until turbulence stuck… THE CRISIS 1. The Lehman Brothers Collapse Suzlon’s order book comprised mainly of orders from foreign countries such as the US, UK, Germany, Brazil and so on. Thus, when the Global Financial Crisis of 2008 set in and the whole world prepared itself for a recessionary phase, orders from the two biggest energy markets of the world, Europe and the US, paused completely and indefinitely. With losses and debt rising significantly to around $1.3 billion, the company decided to sell 35% of its stake in Hansen for $370 million, as part of its debt restructuring program. Suzlon’s flawed business model required only 25% of the cost upfront from the consumers, While the other 75% was financed through bank loans, resulting in a highly leveraged balance sheet. Thus, when the liquidity crunch came into existence, the company couldn’t find the right time to participate in stake sales and asset monetization to reduce its debt burden. Source: ndtv.com 2. Neglecting India for unpalatable ambitions Suzlon’s promoters had been ambitious from the start. Tanti never really considered India to be a prospective market for wind energy. Every time, he was asked about it, the general excuse was that there were no sufficient incentives given by the government. In Tanti’s interview with Forbes Magazine, he was himself heard saying, “three years ago, I did not put up a single turbine for Madhya Pradesh because it was not a priority for me. At that time, opening up another country was my priority.” Thus, when the company was investing significantly in other developing countries such as Brazil, India was ignored blatantly. With time, the company lost its top spot in the Indian market to companies like Gamesa, GE, Vestas and so on. While Suzlon was flirting with customers overseas, global MNCs like GE worked to develop wind turbines tailored to fit India’s conditions. As debt started to accumulate, the company continue to find itself short of cash to fulfil even the existing orders, let alone take new ones resulting in the organisation’s downfall. What does the future look like? Things have improved a bit for Suzlon Energy but not so significant to tantamount a turnaround for the company. The investment by Dilip Shanghvi (founder of Sun Pharmaceuticals) to purchase a 23% stake in the energy provider for $258 million along with the sale of the company’s stake in Senvion, the debt restructuring has helped the company stay afloat but the question of its sustainability remains. The global market outlook for renewable energy looks highly positive as countries target to reach net zero by the end of this century. Moreover, with PM Modi’s push to improve the renewable energy sector’s infrastructure in India, will Tanti be able to ride the winds and capitalise on it or is Suzlon Energy a thing of the past now? Sources: Why Suzlon failed - Shashwat DC Economictimes.indiatimes.com Livemint.com Author: Neeraj Agarwal Illustration by: Divya Jha

It’s Saturday evening. You feel the urge to go to your favourite restaurant so you visit the place and order your favourite cuisine. The waiter courteously serves you hot, delicious meals with swift service. At the time of payment, you pay the bill amount and a little extra - something commonly known as a “tip”, a reward for the waiter’s kind service. Gratuity payments received by employees from the food industry comprise a gigantic portion of an economy’s gratuity income in total. According to a 2011 estimate, the food industry in the US reflected annual tips of about $47 billion. Thus, it is only safe to assume that the number has increased significantly due to the improvement in different socio-economic factors such as standard of living, consumer preferences and so on. The strange tipping behaviour makes us ponder certain questions such as why do we leave a “tip”? Who do we think deserves the tip more? The chef who spends hours inside the scorching kitchen to prepare the meal or the waiter who carries a few plates from one place to the other in an air-conditioned room? Moreover, is it rational to pay more than the bill amount for the services received? Find the answers to all these questions below Why do we tip then? It is difficult to explain the tipping behaviour of a consumer because a tip is generally given after the service has been rendered. Thus, there exists no economic motivation for a consumer to pay more than what he was asked for. One might argue that if the consumer is in a repeated relationship with the seller of a good or a service, where the qualities of the seller matter to the consumer’s utility; the consumer then has an economic motive to show his kindness. However, people also provide gratuity payments at places that they are unlikely to revisit, for instance, a restaurant they went to while on a vacation. Hence, by that logic, we conclude that future service is not a significant reason to explain tipping. Reasons for tipping based on Azar (2010) Thus, leaving behind only psychological and social motivations as reasons to explain such a behaviour by a rational consumer. It is reported that a consumer who was happy before entering the restaurant is more likely to leave a larger tip than a customer who liked the service of the restaurant. In conclusion, pinpointing a particular reason to justify tipping would be impossible and be synonymous with finding a needle in a haystack. A problem that gratuity payments solve… The principal-agent problem arises when the person you hire to do your bidding doesn’t act according to your best interests. To sell your house you employ a realtor, to represent you in legal proceedings you hire a lawyer, the principal-agent problem arises when the interests of these service providers do not align with their employers. For example, you might want to sell your house at the best price, however, the realtor wants to sell the house as fast as possible. Making an extra $10,000 from the sale of your house is a big deal to you, but not to the realtor who only makes a small commission from the sale. While it is extremely difficult for the owner of the restaurant to monitor each and every server all the time, the customer is in the best position to do so. Thus, by offering the meals at a lower price, the owners presumably provide a lower base wage allowing the customers to compensate for the difference depending on their assessment of the service they’ve received. The presence of tips incentivises the server to give their best as it directly impacts the reward they receive. This not only reduces monitoring costs but also solves the principal-agent problem. A problem that gratuity payments do not solve… A restaurant owner has two choices, either pay their employees the minimum wage rate or let the tips paid by its customers make up for the difference between the wage they pay and the wage they are supposed to pay. When the owner chooses the former, the owner increases the menu prices of his dishes to compensate for the increased costs and reduced consumer demand that it entails. When the owner chooses the latter, he cunningly adds something known as a “service charge” (not to be confused with the “service tax” that was replaced by the GST in India in 2017) as a percentage of the total bill amount which the consumer has the option to pay or not to pay. Often, the owners get lucky when customers that don’t pay such attention to detail end up paying the optional amount. And in areas with more careful customers, the owners rarely get lucky. Hence, if the owner chooses to increase its prices, it faces reduced demand. If he chooses to levy the optional service charge, he faces the risk of not complying with the law that requires him to pay the minimum wage rate. What does the restaurant owner choose? The problem is not restricted to restaurant owners only. Many organisations such as Ola, Uber, Zomato, and so on, have chosen the former by adding a tipping feature in their apps. Through the feature, the users can choose to tip the service provider according to their preferences at the time of payment. Uber launched the tipping feature in the US in 2017, and in just one year, it is estimated that it received as much as $600 million in tipping income. In India, however, since Gen Z and the millennials (popularly known as the worst tippers among service providers) make the most use of these apps, the tipping income may not be that high but it is substantial. On the one hand, we have the cooks who actually prepare the meals for us, on the other, we have the servers who act as de facto babysitters and therapists for their customers. Hence, while logic may dictate that cooks should be the ones receiving the tip, the level of ignorance and arrogance in some customers that waiters have to deal with can’t be ignored. A solution would be for restaurants to have a “tip-out” policy, wherein waiters need to share a part of their tips with the cooks. To sum it up, while it may be a flawed practice from an economist’s perspective to tip… on a human level, one’s benevolence might just make the day for their servers. Reference The Economics of tipping by Ofer H. Azar qz.com theath.ca apnews.com Author: Neeraj Agarwal Illustration by: Tanmay Chowdhary