Explore FIC Hansraj

From near extinction to motorcycle royalty, Royal Enfield’s journey is a testament to resilience and innovation. Uncover the thrilling story of how Eicher Motors breathed new life into this legendary brand, capturing the hearts of riders across India and the world! A Classic Beginning Royal Enfield’s story began in 1851 when George Townsend began making sewing needles. By 1881, the company expanded into bicycle components, but it was only in 1901, that Royal Enfield debuted in the world of motorcycling. In the next fifty years, it built a legendary reputation, and a lot of credit for that goes to its iconic Bullet, launched in 1932, which became the longest-living motorcycle design in history. Royal Enfield’s journey started in India when Madras Motors placed an order for 500 Bullets in 1952. As its popularity increased, it became essential for manufacturing in India. In 1955, a partnership with Madras Motors led to the birth of Enfield India . By 1957, the company was producing its own components, and by 1962, the Indian Royal Enfield Bullet was entirely manufactured in India. While Royal Enfield thrived in India, it struggled in the UK. The arrival of Japanese companies made motorcycles cheaper, more reliable, and faster. By 1970, all UK manufacturing of Royal Enfield had ceased. But the Indian market was booming, and in a complete turn of events, Enfield India started exporting back to the UK in 1977!  A New Era with Eicher Motors After navigating management changes and production challenges, Royal Enfield found new life when Eicher acquired a 26% stake in Enfield India Ltd. By 1993, Eicher held a majority stake, officially transforming Royal Enfield into an Indian company, ready to reclaim its legacy. In 1994, after Eicher Motors acquired Royal Enfield, the losses started outpacing the bikes. Sales were sluggish—about 2,000 units a month—compared to a production capacity of 6,000, and the bike was plagued with reliability issues. Despite its fan following it was unable to generate profits. So, in 2000, Vikram Lal, the then CEO of Eicher Motors, decided to shut down the Royal Enfield brand which would mean depriving us of our experiences of life riding an RE. But his son Siddhartha Lal , had other plans and   asked for two years to turn the company around. He was appointed as the CEO of Royal Enfield in 2000.   From 2000 to 2004, he operated from the brand’s Chennai headquarters, implementing cost-cutting measures and spearheading crucial product upgrades. His vision aimed to reignite the spirit of Royal Enfield and reclaim its legacy. Decision Crossroads In 2006, Siddhartha faced a pivotal choice: continue juggling mediocrity across multiple business lines or excel in a few. He   boldly chose the latter,  zeroing in on the motorcycle and truck divisions. This shift allowed Royal Enfield to concentrate on its core offerings, but significant challenges remained, particularly outdated technology and reliability issues that undermined its aspirational image. Siddhartha Lal and his team aimed to modernize Royal Enfield bikes while preserving their rugged aesthetics. They decided to shift the gear from right to left,  a decision sparking resistance from loyal fans. The old cast iron engine, plagued by leaks and emissions, was replaced with a lightweight aluminium engine, solving these problems while maintaining the beloved thud-thud vibration at  70% of the original’s amplitude . Through innovation, they sought to revive Royal Enfield’s legacy for a new generation of riders. On The Rise It was only in 2010 that the balance tipped in Eicher's favour. Eicher introduced the Royal Enfield Classic.  It masterfully blended the appearance and feel of previous generations with modern technology and a better gearbox. Upon launch, it became an instant sensation achieving 100% capacity utilisation, leading to a 6-8 months waiting period , necessitating tripling of production capacity to 1.5 lakh units.   In that same year, Eicher Motors sold 50,000 bikes. By 2012, the number doubled to 1.1 lakhs and by 2014, annual sales skyrocketed to 3,00,000- an impressive sixfold increase!   The excitement continued with the launch of Continental GT; a café racer bike designed to challenge the brand's rugged image . Following that the 'Himalayan' - an adventure touring motorcycle was launched offering riders the ultimate off-roading experience. Today RE boasts a portfolio of 11 models, including Classic 350 and Bullet 350 each embodying the brand’s spirit and legacy. Also very recently, Royal Enfield has decided to go on the EV route, launching a sub-brand, Flying Flea , which will focus only on light weight motorcycles which RE calls an urban plus riding range. Celebrating New Heights For the quarter ending June 2024, Eicher Motors reported impressive total revenue of ₹4,231 crore , marking an 8.49% increase from ₹3,901 crore in the same quarter of FY 2023-24. On July 26, Eicher's shares soared past the ₹5,000 mark for the first time , reaching a new all-time high of ₹5,058.90. The stock’s remarkable rise has created more Crorepatis in India than the famous quiz show "Kaun Banega Crorepati."  Royal Enfield remains a leader in the premium motorcycle market,  although its market share has declined to 88.3% in FY24 from 96.3% in FY19, as competition heats up from rivals like Hero MotoCorp and Bajaj Auto, who have also ventured into the premium segment. In FY24, Royal Enfield sold 912,732 motorcycles —9% more than the previous year—with over 77,000 units sold in export markets, showcasing its enduring appeal and growth potential. With Eicher’s strategic guidance, Royal Enfield has transformed into a beloved motorcycle brand, blending tradition with innovation. Author: Armaanveer Singh and Simranjeet Singh Illustration: Soham Sources Business Today FinancialExpress Forbes Finology Insider News18

The Telecom Sector in India is in a state of flux, dominated by two fierce competitors, Reliance Jio and Bharti Airtel, while the underdog, BSNL, is making an unexpected comeback. Jio and Airtel have long battled it out as the market’s major players, but recent changes in pricing have shaken things up. With private telecom giants hiking their tariffs, BSNL, the state-owned company, has found itself as an affordable alternative, attracting many price-conscious consumers. This pricing shift isn’t just a minor adjustment, it has spurred a customer migration, putting BSNL in the spotlight and prompting the question: Can the state-run provider hold its ground against the giants? When Prices Go Up, Customers Look Down Why were consumers shifting in the first place? Price hikes. In July, Airtel and Jio raised their recharge prices, citing rising costs and the need for sustained investments in infrastructure. This move, however, didn’t sit well with their users. Facing more and more expensive mobile plans, many customers shifted to BSNL, whose relatively stable pricing became a plus point for those unwilling to spend more of their cash. As a result, Reliance Jio, Airtel, and Vodafone-Idea (Vi) all saw significant customer losses, while BSNL recorded a sharp rise in subscriptions. In a month of drastic change, Jio and Airtel lost 750,000 and 1,690,000 users respectively, while BSNL added nearly 3 million new customers. In terms of market share, BSNL's share increased from 7.59% in July 2024 to 7.84% in August 2024. Meanwhile, private telecoms continued to experience a decline in market share. Reliance Jio, which had 40.68% in July 2024, dropped to 40.53% in August 2024. Bharti Airtel, which had 33.23% in July 2024, fell to 33.07% in August 2024. Similarly, India’s third-largest telecom operator, Vi, which had 18.46% in July 2024, decreased to 18.39%. However, BSNL isn’t just winning users through competitive pricing, it’s also upgrading its service offerings. BSNL’s standout prepaid plan, priced at Rs 249, offers a generous 40 days of validity, beating Jio and Airtel's standard 28-day cycle. This plan not only provides 2GB of daily data but also boasts unlimited calling and 100 SMS per day, which are ideal features for cost-conscious users. Furthermore, BSNL is rolling out 20 new 4G towers in regions like Ladakh, which not only improves civilian connectivity but also enhances communication for the Indian Army in remote border areas. With these strategies, BSNL is solidifying its value proposition as a cost-effective, reliable option in the telecom market compared to its counterparts. Airtel and Jio Plan to Hold Their Ground While BSNL attracts customers through affordability, Airtel and Jio still dominate in terms of network speed, reach, and 5G capabilities. In response to BSNL’s growth, Airtel has been investing heavily in 4G and 5G infrastructure, even in smaller towns and cities, to retain high-paying customers and attract new ones. Notably, Airtel has been the only private player to increase its 4G and 5G customer base, adding 2.56 million users in July, even as Jio and Vi faced declines. Both Airtel and Jio are focused on expanding their higher-end services, hoping the 5G market will be a game-changer in maintaining customer loyalty despite higher prices. The shift in consumer base has also revealed an interesting pattern of consumer behaviour. For many, price remains the deciding factor, especially among low-income and rural customers who are more likely to switch providers in response to price hikes. Airtel’s CEO even noted that the company has seen “SIM consolidation” at the lower end of the market, where customers maintain multiple connections but now are cutting back due to cost concerns. This phenomenon indicates a trend where subscribers might opt for BSNL as a secondary, cheaper connection to stay connected without overpaying. The Problem of Keeping Active Users Engaged In the case of telcos, it is important to hold on to active users, those users who use the network on a regular basis and pay for it, so that the revenue is sustained. BSNL has witnessed a healthy growth of active user base within its fold and has added 2.91 million active users in July alone. On the contrary, Airtel, Jio and Vi reported a decline in active users which indicates that BSNL is not only the brand for the price-sensitive customers but also for much more active users. On a weekly basis, data released by the Telecom Regulatory Authority of India (TRAI) exposed that mobile number portability requests increased tremendously as millions of people were in search of better deals; hence, a consumer base that is brand agnostic and appreciates value for money. BSNL’s Technological Advancement: Speed of the 4G-5G Regime This competition is fierce for BSNL, especially because it has one of the oldest structures, and it's only covering a few states with 4G when its competitors are deploying 5G. Overall, there has been an upward shift in BSNL’s customers with the inclusion of 4G services, however, it is still an underdog when it comes to the speed and reach of advanced services. Nevertheless, BSNL widened its base of 4G networks strategically into regions that were not connected. There is a demand from customers residing in these areas who though are not so tech-savvy, seek connections and availability. The Ongoing Struggles in the Telecom Industry The recent changes in the telecommunications sector in India point out the terrain is evolving in the sense of the customers who are price-driven and investors who are in for expansion purposes. While Jio and Airtel are present in the value service market, 5G-enabled and high-quality networks of BSNL assist the company’s growth in the low-end market. The war continues in the Indian telecom sector as operators change their approaches to sustain themselves in the market. The Future of Inclusive Connectivity in India’s Telecom Sector India’s telecom future is set for a shakeup as BSNL steps into the 5G game. While Jio and Airtel focus on premium urban markets, BSNL is likely to bring affordable 5G to rural and underserved areas, bridging connectivity gaps across the country. This move could redefine BSNL as a champion of accessible high-speed internet, adding fresh competition and variety to the market. As 5G spreads, the market will likely experience tailored options for all kinds of users, from price-conscious rural consumers to tech-savvy urban ones, making India’s telecom landscape more inclusive and dynamic. Author: Kanika Jakhmola and Chirag Agarwal Illustration: Dhruv Garg SOURCES Economic Times Business Today  Indiatvnews The New Indian Express

In a world full of hustle and hurry, a consumer keeps convenience as his/her top priority. Can there be something as convenient as getting almost all types of products? In a wide variety? Under one roof? That too at midnight? At accessible locations?  To cater to this emotion, 24Seven was launched in India which welcomed its customers at any time of the day, quite literally ! A retail store chain that was inspired by Japan’s culture of round-the-clock convenience stores. In a country, where streets are active at dark as well, where night owls are on a hunt to find some midnight snacks or have the urge to get cigarettes, 24Seven identified the gap to serve the market 24 hours, 7 days a week. Birth of 24Seven The very famous empire of the Modi dynasty was established by Gujran Modi in 1932, a multi-purpose serving company operating in various sectors mainly tobacco, food, and retail. The  KK Modi Group acquired a substantial piece of cake in the company named Godfrey Philips India Limited in 1936. The company mainly manufactured various types of cigarettes. The company launched its vertical “24Seven” in 2005 owned by Sameer Modi, the 3rd generation of the ModiCare group. To capture every type of customer, the stores were rich in all types of products, everything from groceries to freshly prepared food, cigarettes to cosmetics, etc.  To get a Marlboro at night, 24Seven was never away from sight.  The stores were opened strategically at India’s prime urban locations, where the lanes were alive even at midnight. In 2010, the brand had 50 stores, a century by 2015 and to date, a total of 154 24Seven outlets were present making their influence across north India. Groceries or Laboratories  24Seven proved to be the preferred go-to store for the midnight hunger. But the stores were more advantageous to someone else, not the customers but the ModiCare group itself! The store turned out to be a  live market research laboratory . 24Seven became a market testing ground for the newly launched products under the group like Modi Food products, Colorbar, Indofils, and more. 24Seven was more than a convenience store for Modi Group, it was a supply route for selling the cigarettes of Godfrey Phillips. This helped the company to collect customers' databases, analyse their preferences, and work for future product development and design accordingly. By 2023, 24Seven had a revenue of 396 crores. With an average EBITDA of 8-9%, though decent, it helped the vertical stay profitable and highly strategic for the Modi care group. Floods and Feuds The 24Seven has never been stable since the death of the KK Modi in November 2019. Since then the ModiCare group has always been seen in courts with their internal family disputes. After the despise, Bina Modi, wife of Late KK Modi was appointed the president and MD of Godfrey Philips, however, the sons of Bina and KK Modi believed in splitting the property and getting their shares. These internal feuds led to instability in the performance of 24Seven. Keeping the family disputes in court, the market outside attacked 24Seven with inflation, the operational costs went high struggling to keep up with the demands of the business. There was a major reason that led to the downfall of 24Seven and the impact was as quick as its name suggests, Quick-Commerce.  Brands like BlinkIt, Zepto, and Swiggy Instamart provided the market with more convenience by getting midnight cravings delivered to doorsteps in just 10 minutes. Even the big giants like Reliance and Adani entered the retail market and shook the 24Seven platforms.  Customer loyalty was something, 24Seven could never earn. There was a shift in the consumer preferences in the market that did not end up in the favour of the business. The sales of 24Seven literally went from 24 to 7. All these factors built a strong opinion of Godfrey Philips and it decided to take a swift exit from the business by March 31, 2024, leaving the stores alone at midnight unsecured. The store's net worth was plunged into a negative state, it was truly haunting for the company.  The aspect not to be ignored is the workforce. One of the major sufferers of this tragedy was the employees who are now not working and are idle 24/7. A situation where they can finally sleep at night but now, they do not want to.  The company's mismanagement mismanaged the finances of these fellow victims. Sleepless Solutions After the closing of all 24Sevens, I had no outlet to go at midnight. So I was hit with some optimum solutions, yes of course at 3 AM.  To have a deal with competitors rather than dealing with them. They can partner with Blink it and Zepto and get their products delivered through these apps that are exclusively manufactured by Godfrey Philips. To cover the losses and bring the ship above the sea, they could put a hold on the physical stores for a while to save fixed costs and start an online delivery system. They can analyse the customer data and check which products were least liked by the customers and then replace them with the products having the majority sales. One huge key driver that the 24Seven could not decode in the past 15 years is the presence on online social media platforms like BlinkIt and Swiggy. Expanding their online presence will stimulate people to get out of their beds and visit the stores. This also helps in increasing the brand loyalty. Think of it this way, 24Seven was just a grocery/retail store open at midnight. Exactly, soon this USP started to fade. I believe 24Seven should offer some exclusive experience that truly sets it apart from its competitors. They can make seating arrangements and make it a small cafe cum retail outlet in the middle of the night while complying with the rules and regulations, providing a unique experience, and overcoming the dominance of online platforms. Breaking News! Godfrey Philips has sold all 24Seven stores to a Delhi-based startup named “The New Shop”.  Another retail idea with a new twist and turn this time? A term sheet has been signed already and the transaction is expected to close between end of the September to early October 2024. So can we say 24Seven has reincarnated into a new being, The New Shop? Will it be called an alternative of 24Seven or will it manage to establish its own identity? 24Seven’s journey left us with a strong lesson: to survive, you must evolve. Adapting to shifting market dynamics and prioritizing a customer-first experience is key. As The New Shop steps into the spotlight, it holds the blueprint to avoid past missteps, ensuring a seamless and innovative shopping experience that anticipates consumer needs over the next five years. or else they will also  end up in heaven, like 24Seven . Author: Anshul Sethi Illustration: Parth Koul

Is the hype around SME IPOs justified? Anyone who is into the Indian stock market will recall Jaspal Bhatti's iconic PP Waterballs  sketch. In it, Bhatti glorifies the launch of an absurd IPO for a street vendor selling golgappas , portraying how investors can get swept up in the hype. As the IPO balloons, Bhatti books gains for himself while leaving unsuspecting investors trapped in a financial mirage. It’s all comedy, right? But what if that fictional world is no longer so far from reality? As scrutiny mounts on many recent Small and Medium Enterprise Initial Public Offerings (SME IPOs), the line between satire and the actual market starts to blur . Today, many of these IPOs have raised red flags due to opaque financials, questionable valuations, and rampant speculation. What was once a humorous tale of market manipulation has evolved into a cautionary warning for modern investors.  Understanding SME IPOs While the contribution of SMEs to total GDP was around 30-40% they were not able to flourish their enterprises since they relied majorly on bank loans for the expansion as the banks charged them high rates of interest and a larger portion of the money went into repayment of loan and interest. It was then, the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) got together to launch this initiative in 2012 where Small and Medium Enterprises could raise funds via Initial Public Offerings. They have less stringent listing requirements compared to mainboard IPOs, making it easier for smaller companies to go public. This move aimed to provide SMEs with a much-needed avenue to raise capital, while it also spurs economic growth and creates job opportunities. Unmasking the Dark Side However, as good as it may seem from the outside, SME IPOs have suddenly come into the eyes of investors because of their shady workings and the unjustifiable hype. Take Resourceful Automobile Pvt Ltd , for instance—a company whose recent SME IPO raised more than a few eyebrows. With an issue price of ₹117 per share and a minimum investment of ₹140,400 for retail investors, the offering appeared relatively standard on the surface. But look a little deeper, and the narrative takes a curious turn. The IPO, offering just over a million shares, was oversubscribed by 418 times , with bids worth a whopping ₹4,800 crores. For context, that’s hundreds of times more than what the company itself reported in revenues—a modest ₹17 crores over the last 11 months. And its profit after tax? Just ₹1.5 crores! Suddenly, the numbers don’t seem to add up, do they? The massive demand for shares of a company with just 2 showrooms and 8 employees which sells and services YAMAHA Motorcycles and Scooters, under the banner Sawhney Automobile begs the question: are investors really seeing value, or are they being swept up in a speculative frenzy? Resourceful Automobile  might be driving its way to the stock market, but what’s under the hood seems suspiciously underwhelming. Cases of such SME IPOs do not just stop here, another such case was the Broach Lifecare Hospital operating under the name Maple Hospitals. It floated an IPO to raise ₹ 4 crores, but received bids worth ₹ 604 crore. The hospital operates just 2 branches in Gujarat with 40 beds. Not to forget, the case of Boss Packing Solutions, a company which supplies packaging machines, labeling, capping, and filling equipment and operates from a 500 square yard facility in Ahmedabad. According to its Red Herring Prospectus (RHP), Boss Packing's profits remained flat over 2022-23 and 2023-24, and its net debt increased by 82% in 2023. But running by the trend, its issue size of ₹ 8 crores was oversubscribed by a staggering 135 times. As with Bhatti’s PP Waterballs , what’s glorified at first glance might not survive deeper scrutiny. The stark contrast between the companies’ financial health and their IPO success just smells like cases of an overhyped IPO built on shaky fundamentals. Addressing Concerns and Shaping Regulations   The surge in SME IPOs in India has not only raised concerns about investor protection but also revealed a shadowy practice involving some unscrupulous investment bankers. These bankers have been inflating valuations of SMEs in exchange for a share of the excess funds raised, creating significant risks for investors. Typically, these bankers charge a legal fee of 1% to 3%, but behind the scenes, they negotiate deals with promoters for as much as 50% of the inflated value. These inflated valuations are often backed by falsified financials, with the help of unscrupulous chartered accountants, misleading investors about the true worth of these companies. Such practices have raised cautions about market manipulation, pushing regulators like the National Stock Exchange (NSE) to tighten rules around SME listings. To combat this, the NSE has introduced measures like requiring companies to show positive Free Cash Flow to Equity (FCFE) for at least two out of the last three years and placing a 90% cap on the price of the securities on the first day of trading after getting listed. These steps aim to enhance transparency and curb excessive speculation, while SEBI continues to monitor the role of investment bankers in such dubious practices. As these regulatory reforms take shape, investors must be cautious, conduct thorough research, and not get swept up in the hype, as the SME IPO market becomes more scrutinised and tightly regulated. The NSE's crackdown is just the beginning, and more regulations are expected to follow. The capital raised through Initial Public Offering has witnessed a significant increase. As of June 13, 2024, SMEs stood up with 1000 Crores more compared to the last year which is around 2064 Crores, 53% of SMEs have given more than 300% returns in the past 2 years . This itself is a testament to the fact why retail investors have a keen interest in these SMEs as they can provide them with both short and long-term gains. What’s Next for SME IPOs? As the SME IPO market continues to grow and becomes more regulated, it’s clear that both opportunities and risks exist. For investors, the key takeaway is to stay vigilant and informed. Instead of relying on flashy pitches or questionable brokers like “Prasad” from Bhatti’s skit, take time to study the fundamentals of the companies you're investing in. Understand their financial health, dig into their valuations, and ask tough questions before putting your money at risk. In this rapidly evolving landscape, being cautious and proactive will help you make smarter decisions. Stay informed, stay skeptical, and most importantly, stay in control of your investments—because not everything that shines is gold. Authors: Brahmjot Singh and Palak Kalra Illustration: Japneet Singh Sethi

“Can Distant Turmoil Fuel Our Local Struggles?” You wake up, go out, and find the street quieter than usual, with the buzzing of horns missing. You may be happy at first but later realize that fewer cars are cruising, and those that remain are conserving fuel. Why? Because conflict in the Middle East, thousands of miles away, affects oil production and creates a gulf between the cost of oil and the world price. How does this affect you? Because India imports over 80 percent of its crude oil. The Middle East has been at the eye of the storm for decades, both because of its massive reserves of oil and the continued instability that spreads out, being the storm that disturbs economies worldwide. The slight adjustment in oil supply owing to regional unrest finds a ready translation into sky-high fuel prices that affect trade and everyday life in the case of India, which mainly depends on imported oil. Such conflicts have a strange knack for converting distant problems into concrete hard dilemmas in front of local markets and economies worldwide. The Historical Nexus As the sands of time whisper secrets of a tumultuous past, the history of Middle East tensions unfolds like a rich tapestry, intricately woven with threads of oil, power, and geopolitics. The history of the Middle East can be seen and understood in many ways, however, in this scenario, the focus will be the region’s oil, and oil politics, economics, and power balance – the resources that the area has and which the world needs.  The escalating oil prices reflect the world’s dependence on the Middle Eastern region. The period of 1973 will forever be marked in history due to the oil embargo that brought inflation and a huge surge in oil prices. From then on oil prices continue to be highly volatile to any geopolitical disorder that the Middle Eastern countries tend to experience frequently, and this has the knock-on effect of heightening the perplexity of the clientele that could be expected from the global oil markets. A severe storm characterized the decade following the Iranian revolution, but oil prices increased due to reduced output, and it took years for production to return to pre-revolutionary levels.  Midway through the 1980s when production was at its peak, it was also the peak of the war with the US and Iraq, making it nearly impossible to export. The Gulf War was arguably the turning point in the global oil market where the US once again had to interfere in the Middle East issue. With the commencement of the third geopolitical conflict in the region after a decade of relative peace, conflict further choked the region’s oil reserves and approached the point of no return. Gulf of Uncertainty Tensions in the Middle East have now become the epicentre of almost all global market activities, especially with the war between Israel and Iran and that of Russia over Ukraine only adding fuel to the fire, Furthermore, these events have raised oil prices to nine-week highs because this region contains about 30% of the world's oil supply and is now in turmoil. Safe-haven assets are increasing due to the ongoing geopolitical tensions. Since they started, gold has increased more than 8%. The US is further complicated by the Federal Reserve's unnecessary and inconsistent focus on interest rate increases in the past years, which has pushed bond yields higher and strengthened the dollar. Rising conflict leads to increased demand for gold reserves as a haven. Governments are implementing a strategy to increase their gold reserves to prevent further dispute damage. History repeats itself as alliances and rivalries in the Middle East create more problems than solutions. They are capable of influencing the economies downwards to recession. The implications of these geopolitical situations do not appeal to investors, anyway. From Crude to Chaos: The Economic Implications of Middle Eastern Turmoil Conflicts in oil-rich areas often spill over beyond borders, predominantly disturbing the delicate balance of the world economy. A shutdown of production or blocked oil routes resulted in dramatic surges in fuel prices. This triggers an unpleasant chain reaction: increasing transport prices, rise in inflation, and businesses dependent on reasonably priced fuel find it increasingly hard to maintain their pace. For example, India is among the countries with soaring high oil prices, carrying that cost spectrum in every possible area from food to manufacturing. For Example, Houthi uprisings in Yemen. The insurgency has always centered on critical oil infrastructure while creating chaos along critical shipping lanes. Striking aromatic and other oil tankers and facilities along the Red Sea have made shipping companies detour along less efficient routes thus significantly and severely ratcheting up the operational costs while crippling international trade severely; it is hardly a logistical problem; it has immense financial impacts because delays and costly transportation have been a cost for both businesses and consumers. Right at the receiving end of such instability are the Arab countries, especially Saudi Arabia, the UAE, and Egypt. Two of the world's largest oil-producing states, Saudi Arabia and the UAE, are extremely vulnerable to price volatility because it is highly likely to impact their revenues. Having taken note of this vulnerability, these states have also gone hard for diversifying their economies. For example, Vision 2030 attempts to de-oil the Saudi economy by focusing on tourism, technology, and renewable energy. At the same time, the UAE also features diversifications of focus areas rather than finance, trade, or innovation. Such burdened stability is, in Egypt, added over economic growth, while striking a balance between the relatively scarce imported oil and its quite ambitious infrastructure projects. While these efforts bring a glimmer of hope for a more resilient economic future, the road ahead is still intertwined, in part, with the ever-changing dynamics of the oil market. Financial Aftershocks With escalating tensions in the Middle East, the global financial markets are on a seesaw, with investors anxiously predicting the next swing. The US stock market has experienced significant fluctuations, with the Dow Jones Industrial Average experiencing significant changes. The Federal Reserve is closely monitoring these events and may reconsider interest rate appreciation. Stock markets in Asia have also found themselves under siege, with the Japanese Nikkei 225 and the Hong Kong Hang Seng indices suffering considerable losses. The Indian stock exchange, too, which relies heavily on foreign institutional investors (FIIs), has felt the heat, with the Sensex dipping more than 2% in a single day. The depreciation of the Indian rupee has led to increased import costs and further pressure on the current account deficit. British and German share indices have been under pressure too, with the Financial Times Stock Exchange(FTSE) 100 and Deutscher Aktien Index (DAX) across the channels both taking quite a tumble. Money authority for the eurozone, the European Central Bank has also been looking into the situation, and has suggested that there is no need to raise interest rates for some time now. The stock exchanges within the region have likewise felt the impact of the tensions in the Middle East. The Dubai Financial Market, which has seen far better days, recorded a drop of more than five per cent in a single day. Abu Dhabi Securities Exchange has also faced a significant pullback. The markets have a high level of foreign direct investment, and the prevailing conflicts have diminished investors' confidence. The local governments work to restore market order and attract foreign investors, yet the situation remains volatile.  In the darkness of geopolitical tensions, crude oil prices dance like dust in the storm, disturbing global economies with the heat of uncertainty, and nations brace for the tremors of conflict that ripple through their markets. In our interconnected world, distant conflicts affect our daily lives and routines. As we navigate this complex landscape of chaos and wars it is essential to grasp how these global events shape our experiences. Have you truly grasped the profound ways in which these distant struggles echo through the tapestry of our everyday existence, shaping our thoughts, choices, and the very fabric of our lives? Author: Aditya Kr. Sinha and Soham Illustration: Cheruvu Sai Kartikeya Sources International Energy Agency BBC

At the heart of the Middle East, Saudi Arabia is shifting the tide with an audacious step that can reshape its economy for good and change the course of the region. Launched in 2016, Vision 2030 is not a plan, it’s a promise . A promise to transform an oil-based economy into a powerhouse of sustainable growth and global investment. For a nation defined long by its black gold, Vision 2030 represents nothing short of an all-important turn. Less oil and more tourism, entertainment, and technology . The grand vision is nothing if not future-driven, economically resilient, and ready to inspire transformation across the Middle East. Oil to Opportunity Saudi Arabia's economy has been in step with the oil prices for decades. This dependence has kept the Kingdom perpetually vulnerable to the uncertainties of the global market such that with one downturn in oil prices, the economy quivers. In light of such vulnerabilities, Vision 2030 presents as a strategic move. The idea is to diversify the sources of revenue for the Kingdom, stabilize its economy, and save it from the giddy whims of the oil market. Under this ambitious framework, Saudi Arabia hopes to transition from an oil dependent economy alone into one of the diversified giants, including entertainment, tourism, and technology. It would be quite an understatement to describe Vision 2030 as merely an economic strategy because it is much more than that with its role of transforming the nation. It is this change that will further ensure that the Kingdom not only survives the storms of future economic catastrophes but prospers amidst them, projecting resilience in an increasingly complex global landscape. Building Dreams: The Mega Projects Powering Vision 2030 Vision 2030 towers on the back of several mega projects, each one capable of redefining the landscape and international identity of Saudi Arabia. Futuristic cities, and luxury tourism hubs, each and every one of these represents innovation and ambition. NEOM: A $500 billion ultra-modern city. It is less than a city and more like an experiment in 21st-century sustainability, artificial intelligence, and high-tech living to attract global talent and investors. Red Sea Project: A luxurious tourism destination on the pristine coastline of the Red Sea, this flagship project is set to attract conscience-driven tourists who can experience luxury resorts and marine conservation efforts for Saudi Arabia. Qiddiya: The entertainment capital of the Kingdom, Qiddiya aims at inviting visitors, whether local or international. Theme parks, sporting arenas, and cultural events are an attempt to usher in an era of leisure tourism. King Salman Energy Park (SPARK):  SPARK positions Saudi Arabia at the top of the global ladder for energy manufacturing, further engraving the Kingdom's mark in the global energy sector as well as driving its economic diversification strategy. These are infrastructural landmarks that will lead to an emerging Saudi society. Representing a big pillar of Vision 2030, these projects further propel the Kingdom where all variables blend into the fine balance between tradition and modernism . Unlocking Investment Potential Saudi Arabia's Vision 2030 is no less than a great economic remix in which the kingdom becomes an investment hotbed globally, with aspirations beyond oil. With a flat corporate tax at 20% and no personal income tax, coupled with the prospects of waiver of customs duties, investment land looks "business playground" all over it. And to make things even more decadent, the Saudi Industrial Development Fund is topping the billions with some 75% of the costs of projects in less developed regions. This means global companies will get a chance to  play big without breaking the bank . An effort attracting international attention now enables 100 percent foreign ownership in most fields, streamlined licenses making "open for business" as close to faster than saying "visionary." Three mega zones-NEOM, Qiddiya, and the Red Sea Project-are threatening to take a very large share of notice in tourism, entertainment, and technology, Saudi Arabia as a player in sustainable global partnerships. And that's only Act 1! Long-shut doors in entertainment and renewables are now wide open and breathing fresh life into these sectors. Thus, with PIF leading the way, Saudi's carbon-neutral dream is coming to be while "healthcare clusters" come knocking for foreign players to help build a world-class medical scene. But wait, there's a twist . Under Saudization policies, foreign companies are compelled to hire a certain percentage of Saudi nationals, which adds some heft to the payroll. And as of 2024, if you want to play in this sandbox, a regional HQ in the Kingdom is a must. Prepare for a few hurdles: there are shifting regulations, regional changeovers, and an attempt to conquer an all-dune rally. Mix those dynamics with familiar local customs, sound eco-standards, and a dash of oil price roulette, and that's an adventure. Despite the extra rules, Saudi Arabia's ambitious vision and irresistible investor incentives make it an exciting destination for those ready to grow in the desert turned green . The Future is Here Setting the tone for an exciting new chapter in Saudi Arabia, the mega-projects are building Saudi's future. They put it on the map while remaking it. NEOM is expected to generate 380,000 jobs, while The Red Sea Project is transforming the Kingdom into a premier magnet for tourism and investment, with waves of opportunity running from construction to cutting-edge tech. To get set for this new economy, Saudi is fueling educational partnerships and vocational training to ensure a ready workforce. Social change is revving up in Saudi as events like Formula One racing and new entertainment options inject fresh energy into Saudi culture and attract people from around the world. If these projects do succeed, it will trigger a domestic renaissance that ripples through the entire Middle East. Success here can serve as an impetus for regional cooperation and stability, hence Vision 2030 can serve as a roadmap not only for Saudi Arabia but for a more connected and f orward-thinking Middle East. The mega-projects in Saudi Arabia are changing the skyline of the Kingdom's economy: NEOM and the Red Sea resorts. Once known for oil, Saudi is now setting itself up as a global stage for tech, tourism, and innovation, drawing international intrigue with its drive for diversification. But it's not a game devoid of danger. Saudi Arabia must navigate regional sensitivities, balancing relationships with neighboring countries while addressing internal demands for change. Geopolitical complexities—such as conflicts, shifting alliances, and economic rivalries will make this journey both exhilarating and challenging. However, the litany of healthy reforms and international partnerships supports Saudi's forward movement. As the Kingdom starts to redefine history, perhaps, that of the Middle East question remains: Can Saudi continue to stay on pace and be in a position to be an example for others?  Only time will tell, but the world watches this desert dream unfold. Authors: Manya Singhal and Nandini Ahlawat Illustration: Rohit Sinha

Are you ready to disrupt or will you be disrupted? Imagine you are the captain of a ship sailing smoothly in calm waters. Your destination is clear, the crew is efficient, and the vessel is at the top. What if a peril wave appears out of the dark, threatening to wreck your ship unless you change route immediately? This is the only essence of the Innovator’s dilemma - a situation or a possibility where everything smooth can still lead to failure because the tables have turned. This paradoxical challenge, modulated by Professor Clayton Christensen, is the cruel trick of choosing between sticking with what made you successful or embracing the next big thing that could render your success story outdated. It's a paradox where doing everything right that a business should - fulfilling the customer’s needs, continuous innovations, and having a growth-oriented vision can lead to failure when innovations disruptive in nature take place. Disruptive Innovation: The double-edged sword of success Disruptive innovations are the underdog of the business world. They are typically less lucrative, less profitable, have low margins, and serve a niche market that doesn’t seem to matter much initially. They often start their journey in niche markets that the giant players ignore, but eventually, they start ruling the entire industry. The companies are so driven by their existing customer needs that they tend to overlook the forest for the trees. Let us consider Kodak for example. In the late 20’s Kodak was synonymous with photography. The company enjoyed a monopoly for years and was the darling of Wall Street. But Kodak didn't jump on the new technology fast enough when the digital cameras came along. Digital cameras were initially seen as a niche investment, and Kodak didn’t want to cannibalize its lucrative film business. By the time Kodak fully adapted to digital technology, it was too late, ultimately leaving no option for Kodak except to file for bankruptcy in 2013 while the digital cameras thrived. The difference between disruptive and sustaining innovations lies in their impact on existing markets. Sustaining innovation strategies are used by companies already successful in their industries, by innovating existing products for its best customers, for higher profit margins. Disruptive innovations occur when companies capture new markets or form new networks, ultimately replacing the old ones, ultimately emerging as the winners of the success race. The Dilemma: To disrupt or not to disrupt? The financial implications are daunting for companies struggling with an innovator’s dilemma. Should a company pour resources into sustaining innovations improving the existing products or leap of faith into an uncharted segment with the disruptive innovations that could one day cannibalize its cash cow revolutionizing the entire industry? The risk of clinging to sustainable innovations is that they offer only short-term profits. Yes, the product gets better but it's like playing within the same sandbox. On the other side, disruptive innovators are setting the stage for the next big wave. When the incumbents realized what was happening, it was already too late. the upstarts have already captured major market share, leaving the old guard with- “Remember when we were great?” nostalgia lane Winning the Dilemma But not all doom and gloom. Some companies have understood the Innovator’s Dilemma successfully, proving the possibility of innovation and growth without self-slaughtering. The key to innovation lies in a delicate balancing act that requires vision, courage, creativity, and a good dose of pragmatism. Let's consider Walmart as an example. Walmart, the multinational retail corporation, has gained good recognition for its disruptive innovation in the retail industry. Starting as a small discount store in Arkansas, Walmart revolutionized the shopping experience and affordability of products. One of Walmart’s key disruptive innovations was its commitment to low prices. By streamlining supply chain management and locking favourable deals with suppliers, Walmart was able to pass on the benefit of cost savings to customers, making products more affordable and accessible to the market. But how did Walmart manage to transform the industry without breaking a sweat? One word: vision. Walmart’s leadership realized that clinging to past glories was a recipe for stagnation and self-destruction. Instead, they set out to redefine success, not by playing it safe but by embracing the new and the next. Turning Pennies into Potential One of the core problems with the Innovator’s Dilemma is how they crunch the numbers on new opportunities. Traditional financial metrics like- Return on Investment, and Net Present Value, aren’t exactly the cheerleaders for disruptive innovations we think them to be. These metrics vouch for projects with risk-free returns and lucrative profit margins, which disruptive innovations fail to offer at the start. These metrics are all about pushing companies to invest in projects that deliver fast profits without the risk component rather than being the leader in the clan. To step into the world of long-term profits, some companies are already experimenting with new financial strategies. For example, real options valuation, which considers investment in new technology as a strategic option rather than an all-or-nothing gamble, allows more flexibility in decision-making. It additionally reduces the cost of capital for high-risk projects by as much as 10-25%, making it easier to justify investments in disruptive innovations calling it a win-win situation for the business. Additionally, Corporate Venture Capitalists enable the company to try their luck in startups and cutting-edge technologies, allowing them to engage with disruptive innovators without putting their entire business on the verge of extinction In 2022, CVC funding exceeded $110 billion globally, with renowned names like Google and Intel Capital leading the charge. It's like enjoying a backstage ticket to disruptive innovation, all while keeping the core business safe and healthy. The Innovation Tightrope This is where the innovator’s dilemma gets interesting. It’s not the poor management practices that cause the company to fall into a place of disruption- it’s the good management. The strategies that make companies successful in stable markets are the same strategies that can lead them toward failure when disruption strikes. So what can a forward-thinking person with a long-term vision do? How can they avoid the trap of the innovator’s dilemma? The key is to experiment with the dual strategy to excel in the core business while being open to experimentation with disruptive innovations. This isn't about chasing after every new trend. It's about forming teams with creative minds in the organization to explore new markets and technologies without the need to worry about existing business practices. The Rulebook Revolution Business success can deteriorate when businesses focus too much on their existing strengths without considering the emerging opportunities. Flexibility is crucial.-sometimes you have to disrupt your part before someone else does. Encouraging a culture of innovation across the organization encourages risks and a response to change. Where innovation becomes a part of a company’s DNA, businesses flourish. In the corporate behemoth, becoming fixated on shiny numbers, revenue, and market share is easier. But Innovator’s Dilemma reminds us that those metrics are just the tip of the iceberg. A company can achieve its financial targets but still be on a one-way train to disaster if it's not embracing disruptive innovators. The Innovator’s Dilemma isn’t a one-time thing, but a wake-up call for change. In this fast-paced world, clinging to the old rules is the same as trying to win today’s game with yesterday’s rulebook. Sometimes, the smartest move is not playing along but flipping the board, and rewriting the rulebook.  So if you dream of being a CEO, leading the next big thing, ask yourself: Are you ready to disrupt - Or Will you be disrupted? Author: Neha Agarwal Illustration: Pavni Choubey Sources Medium The NewYorker

"Cash is king" might just be the mantra of the moment, but what does it mean when even the most seasoned investors are stockpiling it at unprecedented levels? On August 5, 2024 , a global chill swept through the stock markets as Warren Buffett, the revered Oracle of Omaha, amassed a staggering $276.9 billion in cash - an all-time high for his Berkshire Hathaway. His strategy was telling: a drastic cut in Apple shares and a relentless 12-day reduction of Bank of America stakes. Meanwhile, in India, the cash reserves on Dalal Street hit a colossal 1.52 lakh crore rupees. Are these monumental cash hoards merely a defensive play, or are they harbingers of an impending market storm? Dive in to uncover the implications of this massive shift and what it could mean for the future of your investments. The US Equity Markets plummeted with major stock indices of the country falling sharply causing the ruckus. Numerous factors played a role behind such a fall: US recession fears, Middle East tensions, and even Japan. The real shocker was the absolute collapse of Japan’s Index Nikkei 225, owing to the interest rate hike  by Japan’s Central Bank sending shockwaves to the rest of the world. Even the Indian markets were not spared and 3,414 stocks ended the day in the red with investors losing Rs 15 lakh crores. What exactly caused the market mayhem that took place on Monday? Is Japan the only one to blame for the global crash or   is it just the tip of the iceberg?   A structural shift in Japanese policy The Bank of Japan (BoJ) decided to increase the key interest rate dramatically from around 0-0.1% to 0.25%. It led to a change in the monetary policy of Japan which hadn’t been touched in over two decades. Such a move resulted in a massive sell-off across the globe causing Nikkei 225 to fall by 12%, the worst since 1987. The economy of Japan had been stuck in a stubborn economic decline for years, which is why Japan had to take a drastic step in 2016, with the intention to incentivize banks to increase lending capacity, a charge was imposed on banks for holding excess reserves with the central bank. The country’s economy, however, was unable to meet its inflation target of 2% despite continuing with years of ultra-loose monetary policies. Even though the country avoided absolute deflation, it was still stuck with a low-growth environment.  The Yen carry trade strategy also had a significant impact on global financial markets. It is a trading strategy that involves borrowing the Japanese yen (JPY) and using the funds to invest in higher-yielding assets denominated in other currencies.  The question is, why did Japan increase the interest rates suddenly? The decision to abandon the ultra-loose monetary policy included various factors, one of which was the falling value of Yen. The Japanese yen was depreciating exceptionally against the US dollar, due to the deflationary gap. Moreover, the increasing rates of inflation in other economies increased pressure on the Japanese economy and due to sight of improvement, the economy showed signs for reducing the need for ultra-loose monetary policy.  This increase in interest rates significantly brought changes in the economy of Japan, the Japanese Yen appreciated against the US dollar. However, this led to chaos in the global financial markets. The volatility led to decline in stock prices first than recovering. As the Yen was appreciated, the investors of profitable yen based investments were forced to cut their losses. This Triggered a market meltdown.  This unexpected policy shift carries risks of a global economic slowdown, financial instability, etc. Looming recession fears in US economy  Japan is not the only reason behind the global meltdown. Fears of the US entering a recession played a big part in the collapse of the equity markets. The US indices, The Dow Jones Industrial Average fell by 2.48%, the S&P 500 plunged by 2.85% and the Nasdaq Composite dropped by 3.36%. What fueled the recession fears?  The US released its jobs reports for July stating that the unemployment rate rose to 4.3% from 4.1% and the monthly job creation was weaker than expected. The nonfarm payrolls increased by just 114,000 jobs in July which was well below the 200,000 jobs required to keep pace with the growing population. The slowed labour market is a result of low hiring instead of layoffs due to the Federal Reserve's interest hikes which have dampened the demand. Even the manufacturing Purchasing Managers' Index, PMI of the United States hit pretty low for a few months now. But what is manufacturing PMI? Purchasing Managers' Index is a tool summarizing economic activity in the manufacturing sector in the US. The index is based on a survey of manufacturing supply executives conducted by the Institute of Supply Management. PMI of the US stood at 46.80, a -3.51% change from the last month and has been experiencing a downward trend. The index helps determine the economic health of the country and such a poor performance was also a reason for a mass sell-off. These recession fears naturally drove the investors to withdraw their investments from the risky assets and run for safety and invest in gold and bonds.  The sell-off primarily focussed on the Magnificent Seven group of stocks which were the reason for the indices’ record high performance this year. The Magnificent Seven Group of Stocks include the stocks of all the world's tech giants: Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGLE), Amazon (AMZN), Meta Platforms (META), Nvidia (NVDA), and Tesla (TSLA). After enjoying heavy gains for the past year, the big guns have come under pressure as the investors have begun to realise that the hefty AI investments shall take a long time to pay off. The big sell-off was also due to recession fears that wiped out nearly one trillion dollars from the combined market value of the seven companies. Also, Warren Buffet’s Berkshire Hathaway halved its stake in Apple, its top holding, raising worries about the tech industry. Nvidia’s shares fell by 6.4% owing to the delays in the highly anticipated Blackwell chips due to design flaws. "Expectations have arguably become too high for the so-called Magnificent Seven group of companies. Their success has made them untouchable in the eyes of investors and when they fall short of greatness, out come the knives," Dan Coatsworth, investment analyst at AJ Bell, said. JP Morgan has claimed the chances of the US hitting a recession at 35%. The Federal Bank has expressed concerns over the labour markets and shall shift its focus to employment expecting rate cuts in the subsequent future. Unrest in the Middle East Geopolitical tensions in the Middle East have played a significant role in the crash. Stocks slipped after Iran attacked Israel , intensifying the ruckus in the Middle East and keeping investors on edge. Although the Middle East tensions had an indirect impact on the crash, they created a climate of uncertainty leading to sell-offs by risk-averse investors. Any instability or conflict in this crucial oil hub can cause drastic oil supply disruptions and price fluctuations, impacting global economies and financial markets, and the Monday crash was a byproduct of such conflict. India's Market Outlook Post-Crash Even India was not spared by such carnage in the global market, with its stock indices experiencing significant declines. The NSE (National Stock Exchange) and BSE (Bombay Stock Exchange) showed a significant decline on August 5, 2024, because of the Reverse carry yen trade. The benchmark indices Nifty 50 and Sensex dropped by approximately 662 and 2223 points, i.e., around 2.68% and 2.74% respectively. Indian investors faced notable losses as the overall market capitalization plunged. A substantial amount of money was pulled out of the Indian market by Foreign Institutional Investors (FIIs), contributing to the market downturn. This also led to increased market volatility, making it difficult for investors to predict the price movements. Various sectors, including banking, IT, metals, and oil & gas, were affected by the sell-off, leading to price declines for individual stocks. The path forward for the Markets The global market turmoil of August 5, 2024, has left investors reeling, but India may find some solace in the relative resilience of its markets compared to others. While the Indian market faced significant losses, it has not endured the same level of devastation as seen in Japan or the U.S. This could position India to stabilise sooner, especially as global factors begin to settle. However, the road to recovery will not be smooth, and investors will need to navigate continued volatility in the coming weeks. Market expert Sunil Shah quoted in an interview “Markets are mimicking and taking cues from the global numbers, so when the global markets are down, we cannot be totally insulated.” According to him, liquidity is causing the selling pressure and there is nothing fundamentally wrong for Indian investors to be worried about. Adding to the global market tension, expectations are building around the U.S. Federal Reserve's next move. As of July 31, 2024, the Fed held interest rates steady at 5.25% to 5.5%, but hinted at a potential rate cut in September. This possibility has stirred investor speculation, but whether the Fed will indeed reduce rates or maintain its current stance remains uncertain. Could this have been merely a reactionary fear among investors, or is there more to unfold? Authors: Parineeta Shrinath Shaw and Cheruvu Sai Kartikeya Illustration: Pavni Choubey Sources • TradingView • Business Today • Business Standard • Google Finance

“Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.” This was a call made by Dwight D. Eisenhower, Former US President in his Chance for Peace Speech on April 16, 1953. This suggests that the resources that could be used to fill an empty stomach are used by empty-hearted people to empty enemies' veins. Instead of covering a man with clothes, he is being wrapped up in coffins. War benefits none of the parties.  US is the world's biggest superpower but that comes at what cost? Imagine you go to school just to see firings and killing. The concern is if everybody possesses a gun for self-defense, who is supposed to attack? Does having such lenient gun laws increase or decrease the safety of citizens? A country that tops the list of largest weapon producers or can we say the list of destroyers? If the US president is not safe, what about its citizens? Arms producing Arms The United States of America, the most developed nation emerges as the world's most dominant power in economic and military realms. The nation has the largest fields, growing crops of arms and weapons. The world's top 5 weapon crafting companies including Lockheed Martin Corporation, Northrop Grumman Corporation, Raytheon Technologies Corporation, and many others originate from the US. Out of the top 100 companies producing weapons, 51 are from the US. The industry is highly driven by geopolitical maneuvers. This unrivaled advantage of military concentration reaps the fruit of authority and influence. The point not to be skipped here is that the majority of the arms sellers are not government companies but private manufacturers. America is in charge of supplying weapons to countries in wartime. The US government when in need, purchases weapons from these private ownerships. The irony is that the government uses the money of the common man (taxpayers) to buy weapons that are used against the common man . The ultimate sufferer in the war between the two countries turns out to be the common man. Let us further understand the position of the US in the world. Trade of Lives The US is the world’s largest producer and supplier of arms and is responsible for more than 40% of global weapon exports. In 2023, the US sold a record-breaking $238 billion in military equipment to foreign governments. The industry faced a striking 49% rise in exports from previous years. These exports were done to 58 different countries. The US has mastered the import sector as well, being the 10th largest importer of weapons. This dual trade system as a leading exporter and importer demonstrates unparalleled influence in the defense area. But does the industry truly benefit the country, or has it plunged the nation into turmoil? The Price for the Prize The country that suffers the most because of this deadly industry is the US itself. To obtain a gun in the US is as easy as obtaining any other legal license. Tragically, the US is the world leader in the field of mass shootings too, a record no nation wants. These events have been increasing abruptly. The US has faced over more than 630 mass shootings in the year 2023. It’s profoundly heartbreaking to realize that these shootings cast a long shadow over schoolchildren, with some incidents tragically influencing young minds to become part of this cycle of violence.  In 2021-2022, more than 327 school shootings have been observed in American schools. These shootings have led to the birth of a new weapon that everybody fears, ‘school shootings’. According to a survey conducted by Pew Research Center in June 2023, “About four-in-ten U.S. adults say they live in a household with a gun, including 32% who say they personally own one”. The Americans have been locked in a nearly even split as to whether possessing a gun increases or decreases safety. This is because the US govt highly favours guns. The Second Amendment of the United States Constitution in 1791 provides the right to bear arms. Gun sales have tripled from 2005 to 2020. In 2022, Americans amassed a dismaying 16.6 million guns, representing how deeply the nation has been drenched in the culture of arms and firing. Security Malfunction? With the near-approaching American presidential elections in 2024, politicians are busy conducting their rallies with high spirits and marches. Donald Trump, former US president’s rally was being held at a fairground in Pennsylvania, Butler. On a 100-acre land, trump was open-fired by a 20-year-old guy named Thomas Mathew Crooks  with a semi-automatic AR-15. Fortunately, Trump unknowingly dodged his head out of the way of the bullet, piercing his right ear. Two people in the rally were injured and 1 was shot dead. Our Indian prime minister tweeted regarding the same issue. Trump was rescued from the firing by his men and the moment his security killed the gunman, trump ascended like a heroic figure and in full aggression raised his arm and signaled the audience to “ FIGHT, FIGHT, FIGHT….. ”. Many people on the internet argue whether it was an assassination or a political stunt. It is still not known who that gunman worked for. Some conspiracy theories predict he did not belong to any terrorist group and was a single-man army. One such conspiracy theory is that he was wearing a t-shirt from a YouTube channel “demolition-ranch” which particularly reviews rifles and shotguns. So he had easy access to guns, however, the reason behind this is still unknown. Conclusion So can we say that this was the result of the leniency of the gun laws that resulted in the open firing on the presidential candidate Trump? The twist of fate lies in the fact that the party Trump aligns with “The Republican Army” relaxed gun laws (in comparison to Democrats), paving the way for the very issues we've seen unfold. Whether it was a political stunt or not, it will surely alter the opinions of the public. With his bold and fearless look, Trump has become an idol and no wonder he has attracted the public in his favour. Moreover with Joe Biden stepping out from the elections, the results are very unpredictable and it is very hard to comment on it. For the safety and welfare of its own citizens and the world, America needs to restrict its gun laws. Similar tragedies were faced by Australia. However, the government responded with the National Firearms Agreement (NFA) between October 1996 and September 1997, and around 650,000 private guns were held. More security should be installed at schools to prevent any mishappenings to occur from the school. Remember, war benefits no party, it's a cycle of arms producing arms to arms killing arms . It just leaves traces to build graveyards, spreading nothing but dismay all around. Author: Anshul Sethi Illustration: Cheruvu Sai Kartikeya

Finance Minister Nirmala Sitharaman unveiled the Union Budget for 2024-25 on 23rd July 2024, aiming for economic resilience and inclusive growth. This budget addresses unemployment, skill development, and infrastructure enhancement, laying a foundation for future prosperity. A substantial ₹2 lakh crore is allocated to five new schemes focused on job creation and skilling for 4.1 crore youth, showcasing the government's commitment to workforce empowerment. The budget outlines nine key priorities, from agricultural productivity to next-generation reforms, in a comprehensive development approach. Three innovative employment schemes offer direct benefit transfers, EPFO (Employees’ Provident Fund Organisation) linked incentives, and employer reimbursements to stimulate job creation and economic activity. Support for MSMEs includes measures to ensure bank credit continuity, increase Mudra loan limits, and establish E-Commerce Export Hubs, bolstering small businesses. Significant allocations were made to Bihar and Andhra Pradesh. Bihar received ₹26,000 crore for infrastructure projects and ₹21,400 crore for power projects, while Andhra Pradesh was allocated ₹15,000 crore for developing its capital city, Amaravati. These investments aim to support the infrastructure and development needs of these states, raising questions about whether this reflects a balanced approach to national development or a strategic move to secure political support from key states? Fiscal prudence is emphasized, with a projected fiscal deficit of 4.9% of GDP for FY25, down from 5.1% in the Interim Budget, aiming for below 4.5% next year. Tax reforms include revised capital gain taxes and reduced customs duties, expected to ease taxpayers' financial burdens and stimulate investment. Overall, the Union Budget 2024-25 emphasizes inclusive growth, fiscal responsibility, and strategic investments in human capital and infrastructure, laying a solid foundation for a prosperous and equitable India. INFRASTRUCTURE The Union Budget 2024-25 places a significant emphasis on infrastructure development, maintaining a robust capital expenditure (capex) allocation of ₹11.11 lakh crore, which constitutes 3.4% of GDP. This substantial investment underscores the government’s commitment to strategic investments in both public and private sectors, aiming to drive economic growth and create jobs. Key programs focus on enhancing transportation infrastructure, including economic railway corridors, port connectivity, and high-traffic density corridors. The aviation sector, which has seen remarkable growth, will benefit from plans to develop new airports, enhancing connectivity and boosting tourism. On the social infrastructure front, the budget continues to prioritize housing. The announcement to build an additional 2 crore houses under the Pradhan Mantri Awas Yojana  highlights the government’s commitment to providing affordable housing and stimulating the construction sector. This initiative is expected to generate a positive ripple effect across various industries, including cement, steel, and other construction materials. EMPLOYMENT SCHEMES The budget introduces three innovative schemes aimed at incentivizing employment, particularly for first-time employees and the manufacturing sector. Scheme A  provides first-time employees in all formal sectors with a direct benefit transfer (DBT) of one month’s salary, up to ₹15,000, in three installments. Scheme B  focuses on job creation in the manufacturing sector by providing incentives to both employees and employers based on their EPFO contributions for the first four years of employment. Scheme C  offers employers reimbursement of up to ₹3,000 per month for two years towards their EPFO contribution for each additional employee, with a salary cap of ₹1 lakh per month. This scheme is expected to benefit 2.1 lakh youths. SUPPORT FOR MSMEs Micro, Small, and Medium Enterprises (MSMEs) are a vital part of the Indian economy, and the budget introduces several measures to support them. These include a new mechanism to ensure the continuation of bank credit during stress periods, increasing the limit of Mudra loans from ₹10 lakh to ₹20 lakh, and reducing the turnover threshold for mandatory onboarding on the TReDS platform from ₹500 crores to ₹250 crores. Additionally, the budget provides financial support for 50 multi-product food irradiation units and plans to establish E-commerce Export Hubs in PPP mode to enable MSMEs and traditional artisans to sell their products in international markets. SKILLING PROGRAMMES The budget includes a comprehensive package to boost skilling and education, recognizing the importance of a skilled workforce for economic development. It plans to upgrade 1,000 Industrial Training Institutes (ITIs) in a hub-and-spoke arrangement over five years, ensuring that these institutes can provide high-quality training. The government aims to skill 1 crore youth through internships in top companies, with a 12-month Prime Minister’s Internship providing a monthly allowance of ₹5,000. CUSTOM DUTIES The budget announces several changes in customs duties and tax reforms to boost manufacturing and ease the financial burden on taxpayers. Customs duties on gold and silver have been cut to 6%, and on platinum to 6.4%. Lithium, copper, and cobalt are now exempt from customs duty, reducing costs for various industries. The exemption list for capital goods used in manufacturing solar cells and panels has expanded, promoting renewable energy. Basic Customs Duty (BCD) on MDI for manufacturing spandex yarn has been reduced from 7.5% to 5%, and customs duty on manufacturing connectors and oxygen-fused copper has been exempted. TAX REFORMS Significant tax reforms have also been introduced. Short-term capital gain tax on certain financial assets has increased to 20%, while long-term capital gain tax on financial assets has been revised to 12.5%. Revised income tax slabs are expected to save taxpayers ₹17,500. Additionally, the TDS rate on e-commerce operators has been cut to 0.1% from 1%, reducing compliance burdens. The budget dismantles barriers to investment and innovation. The angel tax, which discouraged investment in startups, has been abolished for all investor classes. Income from share buy-backs by companies will now be charged as dividends, and the cost of such shares treated as a capital loss to the investor. The budget also enhances the International Financial Services Centre (IFSC) by extending tax exemptions to retail schemes, ETFs, core settlement guarantee fund incomes, and certain finance companies. Venture capital funds in the IFSC are exempt from explaining their source of funds and specified funds' income from securities is not subject to a surcharge. However, indexation benefits on property sales have been removed, and long-term capital gains tax on property sales is set at 12.5%. The budget also increases the Securities Transaction Tax (STT) on options transactions from 0.0625% to 0.1% of the option premium and raises the STT on futures transactions from 0.0125% to 0.02% of the futures price. These adjustments aim to generate additional revenue and align the tax structure with evolving financial market dynamics. MAJOR SECTOR EXPENDITURE The budget outlines substantial allocations for various sectors to drive economic growth and development. Key allocations include ₹4,54,773 crore for defence, ₹2,65,808 crore for rural development, ₹1,51,851 crore for agriculture, ₹1,25,638 crore for education, ₹89,287 crore for health, and ₹68,769 crore for energy. These allocations reflect the government’s commitment to strengthening these critical sectors and ensuring balanced development across the country. Impact on Prices The budget’s changes in customs duties and tax reforms are expected to impact the prices of various goods. Items that will become cheaper include mobile phones, chargers, precious metals, cancer drugs, solar energy parts, and certain broodstock. On the other hand, items that will become costlier include ammonium nitrate, PVC flex films, laboratory chemicals, and non-biodegradable plastics. These adjustments aim to balance the needs of different industries while promoting sustainable practices and reducing the overall tax burden on consumers. A Future-Forward Fiscal Blueprint While the changes in Securities Transaction Tax (STT) on futures and options transactions might discourage excessive trading, they could also generate higher revenue from taxes. The revised income tax slabs favour salaried employees, potentially boosting consumer spending and economic growth. Overall, the Union Budget 2024-25 is a forward-looking financial blueprint that aims to achieve a balanced approach to growth, fiscal responsibility, and strategic investments. It sets a clear path towards a prosperous and equitable India, addressing current challenges while laying the groundwork for future advancements. As India navigates this transformative journey, it is essential to consider how these changes will impact various sectors. Considering the tax reforms and other major steps taken in this budget, will the traders evolve into long-term investors, or will their returns simply bolster the government's tax revenue? Author: Alok Kumar Pandey Illustration: Japneet Singh

Paytm's journey in India's fintech gold rush has been a thrill ride. Once a mobile wallet rockstar, it's grappled with regulatory roadblocks, creating a narrative as captivating as it is complex.  But like a phoenix from the ashes, Paytm's recent partnership with Samsung and its international ventures have sparked a fire of hope, sending its stock on a vertical climb. Buckle up as we dissect this potential phoenix tale and see if Paytm can truly rise again. From Humble Beginnings to Soaring Heights Paytm's journey began in 2010 when it introduced a mobile wallet that revolutionized the way Indians made payments. Cash was dethroned by the convenience and security of a mobile wallet. This digital alternative resonated with the Indian public, especially after the demonetization of 2016 sent a shockwave through the traditional payment system. Paytm, perfectly positioned to ride this wave, witnessed a user base explosion - a staggering 781% increase in just one year. In 2014, they had a modest 1.18 Crore (11.8 million) users, a number that skyrocketed to a phenomenal 10.4 Crore (104 million) by 2015. But Paytm's vision wasn't limited to smartphones. By strategically partnering with Kirana stores they ensured their technology reached every corner of the country, seamlessly integrating digital payments into the everyday lives of millions. It wasn't just about convenience; it was about transforming a nation's financial landscape, one transaction at a time. A Reality Check But, Paytm's party wasn't all cake and rainbows. The Indian fintech market turned into a battle royale, with established players like PhonePe and Google Pay throwing punches, not to mention new challengers like Amazon Pay entering the ring. Paytm's initial strategy of throwing virtual confetti (discounts and cashback) to win over customers started to show cracks. Analysts, like Macquarie Research, questioned Paytm's business plan, saying it needed more focus and direction. Furthermore, Paytm's much-anticipated IPO in 2021 fell short of expectations. The stock price took a nosedive on day one, dropping a whopping 27%, shattering investor confidence like a dropped phone. To make matters worse, there were rumours of a data leak in their e-commerce venture, Paytm Mall, which wasn't exactly the best look. Additionally, unsuccessful attempts to diversify into insurance and other sectors added to Paytm's woes. The Regulatory Hammer The most significant blow came in 2024 when Paytm's meteoric rise in the Indian fintech industry screeched to a halt. The central bank, the Reserve Bank of India (RBI), delivered a regulatory uppercut, citing non-compliance with KYC norms and other financial regulations. This wasn't a playful sparring match; it was a knockout punch to investor confidence. Paytm's stock price took a 20% nosedive in a single day, shaving billions off its market value. The RBI's sanctions were akin to clipping Paytm's wings - restrictions on new deposits and limitations on existing services like fund transfers and bill payments threatened to ground their growth trajectory. Partnering for Survival In the face of the crippling RBI sanctions, Paytm did not crumble entirely. The company displayed remarkable agility by forging strategic partnerships with several established financial institutions. This crucial move allowed Paytm to continue offering essential services like UPI (Unified Payments Interface) transactions to its vast user base. Paytm joined hands with prominent banks like Yes Bank, Axis Bank, HDFC Bank, and the State Bank of India (SBI). These partnerships enabled Paytm to leverage the partner banks' licenses for processing UPI transactions. Notably, users with the "@paytm" handle were migrated to one of these partner banks, ensuring a seamless transition and minimizing disruption for customers. This strategic alliance served as a lifeline for Paytm, allowing it to maintain its core functionality while addressing the RBI's compliance concerns. However, this partnership signifies a shift in Paytm's operational model. Previously, Paytm Payments Bank acted as the primary channel for UPI transactions. Now, with the RBI sanctions, Paytm relies on its partner banks for transaction processing. This highlights the crucial role of regulatory compliance and the importance of maintaining a healthy relationship with financial authorities. Strategic Partnerships and Expansion Plans: A Beacon of Hope? In a ray of sunshine for Paytm, a recent collaboration with Samsung brings a fresh wave of optimism. This strategic partnership allows users to seamlessly book flights, buses, movie tickets, and event bookings directly through the Samsung Wallet, powered by Paytm's robust platform.  This innovative move taps into Samsung's massive user base in India, exceeding 50 million strong, potentially opening doors to a significant new audience for Paytm. Furthermore, Paytm has set its sights on international expansion. The company is aiming to become your all-in-one travel pit crew. By partnering with giants like Wego, Skyscanner, and Google Flights, they're making a strategic play to grab a slice of India's booming travel and tourism sector, projected to hit a staggering $130.5 billion by 2025. Additionally, Paytm is reportedly in talks with other international flight operators like Cambodia Angkor Air, SalamAir, and FlyDubai, further solidifying its expansion plans. Financial Viability and the Road Ahead Paytm's comeback melody is a three-part harmony: outmaneuvering rivals, staying on the right side of regulations, and proving their financial prowess. While the recent partnerships with Samsung and travel aggregators offer promising avenues for growth, their long-term impact on Paytm's revenue stream remains to be seen. The company needs to explore ways to monetize these partnerships effectively, potentially through transaction fees or commission structures. Furthermore, regaining investor confidence is crucial. Paytm's IPO in 2021 raised ₹18,300 crore ($2.5 billion), a significant sum that can fuel its expansion plans. However, the company needs to demonstrate a clear path to profitability to justify its current valuation and attract further investments. This might involve diversifying its revenue streams beyond just cashback offers and exploring possibilities like subscription-based services or value-added features within its app. Regulatory Compliance Maintaining regulatory compliance remains paramount for Paytm's future success. The RBI's recent measures are a wake-up call for the fintech industry, a bold underline reminding everyone that financial regulations are the cornerstones of trust. Paytm must invest in robust compliance measures to ensure KYC norms are strictly followed and implement strong anti-money laundering (AML) practices to regain the RBI's trust. A Phoenix in the Making? Paytm's recent stock price surge reflects cautious optimism about its potential comeback. The strategic partnerships with Samsung and travel aggregators, coupled with its international expansion plans, offer promising avenues for growth. However, the road to recovery remains arduous. Paytm needs to demonstrate financial viability, rebuild investor confidence, and most importantly, ensure unwavering compliance with regulations. Only by addressing these challenges can Paytm truly rise from the ashes and reclaim its position as a leader in India's dynamic fintech landscape. The next few months will be a crucible, forging Paytm's future - will it emerge triumphant, or will the embers of its ambition fade away? Author: Alok Kumar Pandey Illustration: Cheruvu Sai Kartikeya Sources • Statista • Business Today • Mint • Business Insider

In a virtual twist to buy low, sell high, SEBI’s ban on fantasy stock trading platforms has left traders wondering, Was it all just a fantasy? In the labyrinthine world of finance, where fortune rises and falls in the blink of an eye, there exists a whimsical corner known as fantasy stocks. We trade in stock, hoping it will soar in a few days. Instead, it plummets, leaving us in a financial free fall. Not only do we lose money, but also the broker fees, stock exchange fees, taxes, and other charges. It’s a roller coaster ride where the financial thrill quickly becomes a nightmare. But what if we could enjoy the thrills and spills of Wall Street without fearing financial ruin? That’s what fantasy stocks are: the markets can be played with monopoly money and the bragging rights of a top trader- all without putting a dent in our bank account. Fantasy Stock: Financial Funland Fantasy Stocks offer a delightful twist on stock trading allowing us to dabble in real stocks from exchanges like NSE and BSE. But here instead of worrying about the market fluctuations, it will enable strategizing in a risk-free environment. It provides an opportunity to speculate, plan, and compete with friends and strangers without the stomach-churning risk. It involves users creating fictional portfolios of stocks and competing with other users in a contest. Users pay an entry fee to enter these contests, and the best-performing portfolio creators win the cash prizes. The point system that ranks the performance of the fictional portfolios created by users is tied to the actual performance on the stock exchange. Typically, these games or leagues do not involve trading in any actual shares or the right to sell or purchase any actual shares but the performance of the portfolio tracks the price movements of the shares traded on the floor of the stock exchange. It is basically financial freedom in a virtual world- where the only real loss is a nominal entry fee and the potential rewards include everything from shiny gadgets to dream cars. All we need to do is to predict if the price of the stock will boom or fall in the next 60 seconds and the only loss we bear if the trade doesn’t go our way is the nominal entry fee. It provides a haven for exploration. The Fantasy Stock Frenzy In India, multiple online stock gaming platforms allow users to play fantasy stock games. Key features include live data feeds, social networking with fellow traders, and leaderboards showcasing the top performer of the week. Here’s no dealing in actual shares but the virtual platform dances to the beat of real-world stock movements. Think of it like Wall Street without the pressure of the margin calls! India’s fantasy gaming industry is now a colossal INR 34,000 crore behemoth. This virtual playground now entertains 13 crore registered users. Unsurprisingly, cricket is the undisputed champion here, pulling in a hefty 85% of the revenue. Meanwhile, football, the perennial underdog secures a modest 6.32% pie. The future growth looks more fantastical, with Federation of Indian Fantasy Sports(FIFS) projecting the industry to skyrocket to INR 1,65,000 by 2025. The industry is on a winning streak, not planning to fall. SEBI’s Data Dilemma But when the fantasy stock experts were revelling in their fantasy virtual street exploits, all the fun screeched to a halt. In a twist straight out of the courtroom drama, the Securities and Exchange Board of India (SEBI) decided to pull the plug on fantasy trading stock platforms. So what drove SEBI to rain on this financial parade? These virtual trading apps use real-time data from heavyweights like the NSE and the BSE, to ensure that their trading platforms feel as authentic as the real ones. Also, exchanges gather revenue through primarily transaction fees on executed trades and subscription fees to access the data. Interference of the third-party platforms by using the data to host games,not only disrupts revenue streams but also flouts SEBI’s rules and regulations. SEBI rolled out a circular on May 27, 2024, aiming at stock exchanges, depositories, and clearing corporations. It barred them from sharing real-time data with outsiders unless it was for regulatory compliance or maintaining market decorum. To spill the beans, intermediaries must sign solemn agreements, justifying compliance with the guidelines. However, to educate investors and raise investor awareness, they can disseminate the data with a one-day delay. The norms are expected to come into effect on June 23, 2024. This isn’t an out-of-the-blue decision made by SEBI. It had an eye on these platforms a long time ago. Back in 2016, an investigation into Raj Kundra’s operations revealed a murky world of data exploitation for gaming purposes, a practice rebuked by SEBI. Despite several warnings against such actions, the allure of easy gain led to new gaming platforms exchanging data from websites. Last year, amidst market euphoria, SEBI ordered influencer Ravindra Bharti and his wife to pay over Rs 12 crore a penalty after promising 1000 percent returns to the investors over an investment, ordering them to cease investment advisory services. The incidents tampered with the investor’s confidence in the security market. These games prove to be detrimental to users. While these games earn money through increased user engagement, SEBI does not regulate them, dodging the need for disclaimers about real-world trading. Users might mistake their virtual success for mastery in Wall Street, only to crash while trading actual stocks. That’s why SEBI wants to pull the plug on their real-time data joyride. Regulatory Ripples The immediate aftermath of the decision saw a flurry of reactions. Users of the platforms took to social media to express their frustration and disappointment. Fantasy Stock trading had become a beloved hobby for many, and the ban felt like a personal upfront. Platform operators, on the other hand, were swift in their responses, some tried to criticize the ruling, while others started planning to pivot their business models. The regulations targeted trading platforms like Stockpe, Trading Leagues, and Bullspree, which allow users to gamble in these stimulated markets for monetary rewards, all from the safety of their screens. Stock pe, for instance, caters to participants aged 18-24, providing them with a gateway into the world of trading stocks while earning commissions from tournament participants. TradingLeagues recently showcased the sector’s burgeoning appeal by securing $3.5 million in pre-series, funding led by Leo Capital. However, with SEBI’s new rules, these once profitable sectors are now feeling the pinch, worrying about what the future holds. Fantasy Future The future of virtual stock games in India is now up in the air. SEBI's ban underscores the regulatory challenges faced by these platforms. Unless they comply and adapt to these regulations, their future remains bleak. Developers will need to modify their apps to comply with the SEBI’s regulations. The ban also raises questions about investor confidence in such platforms. SEBI's move reflects concerns over misleading users into believing that success in fantasy trading translates to real-world investing expertise. Clear disclaimers and educational efforts could be necessary if these platforms attempt a comeback in the future. Though according to SEBI’s guidelines, the price data can be used by educational fantasy stock gaming platforms that operate for free to raise market awareness. While they can still access data,they will be able to get it one day later. SEBI’s new regulations not only signal the end of paid virtual fantasy stock gaming platforms but also cast a shadow over free educational ones. This shift threatens to snuff out a crucial,engaging avenue for learning about the stock market,leaving both aspiring investors and educators in hunch. While these virtual platforms are a way to learn about the market functioning, SEBI is now playing the role of a stern parent, mainly concerned with safeguarding the investors. This would surely push the developers to create more educational and responsible financial experiences- Less casinos, More classrooms! Author: Neha Agarwal Illustration : Cheruvu Sai Kartikeya Sources The Indian Express Times of India The Economic Times Business Today Finshots

Unveiling The Pioneer: The Good Old Days We often think about Facebook, Instagram or Twitter when we talk about a social networking platform. Still, it was not the same for people 20 years ago as then the social networking sector was dominated by one of the earliest and most influential platforms- MySpace. MySpace was launched in 2003 to offer a virtual platform for social networking, self-expression, and discovering music. MySpace played a vital role in shaping the early landscape of online social interaction by revolutionising the way people interacted with each other through the internet. In the initial years, MySpace gained exponential growth as it was able to attract millions of users with a keen interest in creating personalised profiles, finding friends, discovering new music, and following their favourite artists. Its key defining features include customizable profiles which allow users a high degree of personalization for creating their profiles. Music integration, “Top 8 friends” etc. were among the other key features offered by MySpace. The Inaction and demise of MySpace Undoubtedly, MySpace was successful as a start-up gaining huge valuation from investors, large appeal from users, and rapid traction for growth. However, things changed as time passed and a competitor emerged - Facebook. By the late 2000s, Facebook’s user base skyrocketed, surpassing MySpace, which was already stagnated and declining in popularity, active users, and engagement. There were several factors leading to its downfall which include both the technical and the managerial fields. Firstly, the high degree of customization which attracted many users had a problem in itself, it turned out to be cluttered and led to an inconsistent user experience deviating from the fundamental principle of simplicity. Next, it has converged most of its focus on music, attracting and retaining a smaller user base. There were also many security and privacy concerns related to MySpace which included issues related to fake accounts and spam. Though these all were significant factors, the one main factor was the management of MySpace, which was under the control of NewsCorporation which had appointed a highly qualified team to manage MySpace which in turn led to rigidity due to the execution of strictly laid down plans instead of responding effectively to the market trends and changes. How did Facebook create its “Space”? The early winner showed up to be a failure, but how did it all go off-base? After the acquisition by the media giant, NewsCorportion, MySpace was given a professional viewpoint whereas Facebook was seeking after its travel through a few college undergrads and it certainly backfired the former. While the market decided where the business ought to go for Facebook, the “professional outlook” of MySpace reflected a fallacy of modern management that some way or another accepts that MBA grads would continuously make the business better off with their industry information, but the readiness to make mistakes by eager college undergrads demonstrated to be leagues superior than making complex excel calculations and relying on numbers. Facebook was one of the first social media stages to insist on real names of accounts and people, unlike its counterpart, never bothered to take the initiative and rule out the creepiness of fake names. MySpace's initial victory was built on the preface of customisation, allowing clients to customise their profiles with background pictures, music players, and unique formats. But as Facebook got prevalent, clients started floating towards more oversimplified and easy-to-use interfacing over intemperate customisation. In January 2008, many individuals got together to announce the 30th ‘International Delete Your MySpace Account Day’, inciting others to urge freedom of their Myspace accounts and connect to Facebook instead. The cluttered advertisements on website pages may make anybody feel unpleasant and that’s precisely what MySpace did, indeed if they did not expect to, whereas Facebook advertised a clean interface and didn’t have ads that would make the page horrible. Facebook composed the script of MySpace’s downfall and uprooted MySpace from 2008 to 2013 essentially as MySpace could do nothing to heal their woes. (Image: The MySpace page cluttered with ads) The “Meteoric” Rise of Facebook From its humble beginnings on the Harvard campus to a tech giant with 2.1 billion daily active users, Facebook has come a long way. Defying the prominent business mantra “first mover advantage”, Facebook put up a masterclass of “late mover advantage” to shine like a star in the competitive landscape of social media networks. Earlier social media networks provided Facebook with a list of blunders to avoid. Supervised growth added drastically to the success of Facebook as the clean and robust technological infrastructure adding value to the user experience came in handy to avoid the unattractiveness of the competitors. MySpace was eating dust after 2008 and losing its major market share to Facebook, thanks to the smart engineers who worked day and night to innovate, not just for the sake of it, but for the users to experience convenience like never before and get used to it. Acquiring Instagram in 2012 and WhatsApp 2 years later put Facebook in a spot where there was no looking back and the masterclass thrived further when it allowed live video streams in 2016 and these chronological events - all in the gap of 2 years intensified the way Facebook flourished. Creating a “Facebook Watch” section allowing the users to watch video content, was proven to be a significant bite of Facebook’s success meal and allowed it to thrive further. To sum things up, “MySpace was defeated by White Space The blue took over, inserting the internet craze, Where others are grappling for a spot in the social palace, Facebook's king-sized masterclass still reigns” Authors : Md Imran and Sai Advaith Kandi Illustrator: Japneet Sources: Forbes Telegraph Convince and Convert

Fall in love with learning or learning about falling? BYJUs, the Icarus of the Indian ed-tech ecosystem that flew too high, used to be at the forefront of India's educational technology industry. It started small but grew incredibly fast, becoming a symbol of innovation and entrepreneurial drive. Their story captured the imagination of many, promising to revolutionise education. But just like any story of success, BYJUs took a sharp turn and landed in a deep financial crisis that shook the entire ed-tech world. Let's explore what went wrong and break down the reasons behind this downfall. A Look Back at BYJU's Golden Age Let's rewind the clock to a time when BYJUs was the undisputed champion of the ed-tech empire. Founded by Byju Raveendran, the company's journey began in the quaint village of Kerala, where a passion for teaching mathematics ignited a spark of innovation. From humble origins, BYJUs swiftly rose to prominence, leveraging exceptional teaching methodologies to attract millions of subscribers. With strategic investments and high-profile endorsements,  BYJUs emerged as unicorns, signalling a new era in digital education. The years between 2015 and 2021 witnessed an unprecedented surge in valuation, propelling BYJUs to the forefront of India's startup ecosystem. Yet, amidst the applause and admiration, ominous clouds began to gather on the horizon. The Lapses Disclosed: How BYJUs It’s Way! The downfall of BYJUs, once respected as a trailblazer in the field of educational technology, can be traced back to a series of mistakes in strategy that shifted its attention from teaching methods to aggressive sales tactics. Established in 2011 by Byju Raveendran and Divya Gokulnath, BYJUs initially disrupted the landscape of online learning with its innovative platforms tailored for learners spanning from early childhood to professional development. However, the company's departure from its educational mission towards relentless marketing, alongside dubious accounting practices, signalled the beginning of its downfall. Despite initial triumphs and a global footprint, BYJUs encountered setbacks as it prioritised sales volume over the delivery of educational excellence, leading to disappointment among its user base. A pivotal factor contributing to BYJUs downfall was its adoption of aggressive sales strategies. They got really pushy, trying to pressure parents and teachers into buying their products and services. Moreover, the company's financial troubles, including accusations of hiding financial information and failing to repay loans, made its situation even worse. The departure of key board members and auditors, coupled with significant workforce reductions, underscored the company's struggle to regain stability. Despite once commanding a valuation of $22 billion and being hailed as a frontrunner in EdTech, BYJUs rapid expansion without adequate financial governance ultimately precipitated its demise, underscoring the imperative of sustainable growth and ethical business practices in the EdTech sector. BYJUs's rapid rise in the Indian educational technology landscape, from its humble beginnings to a leading industry player, seemed like a typical modern success story. However, underneath its surface of fast growth from 2015 to 2021, lay the beginnings of its eventual failure. Despite the excitement about its growth, fueled by big investments and global expansion, BYJUs aggressive actions started to come apart. Expensive marketing efforts and notable acquisitions, like WhiteHat Junior and the billion-dollar acquisition of Aakash, stretched its finances and made stakeholders uncertain. Additionally, the weight of large debts, including a massive $12 billion loan, made BYJUs’s financial situation worse, leading to its eventual downfall. BYJU’s Present Performance Palette BYJUs, is facing a legal battle with four investors who have accused the company of "oppression and mismanagement." These investors filed a lawsuit with the National Company Law Tribunal (NCLT) seeking a stay on the company's $200 million rights issue, alleging it was illegal and lacked transparency. Despite ongoing financial struggles, BYJUs received some temporary relief, with the National Company Law Tribunal (NCLT) allowing the company to proceed with its rights issue, a potential source of additional capital. However, the situation remains uncertain, as the NCLT reserved judgment on interim orders requested by four investors in their lawsuit alleging "oppression and mismanagement." Both parties must now submit written arguments and await the NCLT's April hearing. BYJUs also face separate insolvency petitions from entities like the BCCI and US lenders, further complicating their situation. This mess of lawsuits, coupled with financial difficulties,  hangs over BYJUs future like a dark cloud and leaves us with a question: Can they fight their way out of these problems and get back on track? The Restructuring Journey In response to increasing financial challenges and regulatory scrutiny, BYJUs has undertaken a significant journey of restructuring and cost-cutting measures aimed at overcoming difficult times. A pivotal milestone in this journey has been the resolution with leading creditors, wherein BYJUs negotiated terms to avert loan acceleration and enforcement actions, opting instead to pay the interest component upfront and defer repayment over instalments. Concurrently, the company has implemented aggressive cost-cutting initiatives, including employee layoffs and office space optimisation, symbolised by the vacating of significant square footage at Knowledge Park and the closure of certain offices in Bengaluru. These measures underscore BYJUs commitment to streamlining operations, enhancing efficiency, and alleviating immediate financial pressures while also positioning the company for sustainable growth in the long term. Amidst these restructuring efforts, BYJUs has prioritised transparent communication and stakeholder engagement to reassure investors, employees, and the media about its strategic direction and commitment to recovery. Proactive engagement with stakeholders, coupled with regular updates on restructuring initiatives, aims to foster trust and credibility in Byjus' resilience and forward-thinking approach. As the company charts its path forward, guided by a vision of sustainable growth and long-term viability, strategic partnerships and a culture of innovation will play instrumental roles in shaping its future direction. In dealing with the complexities of its restructuring journey. Nuggets of Insights from the Incident The BYJUs incident, involving allegations of mismanagement, aggressive sales tactics, and financial concerns, has several potential lessons to be learned. The one thing that easily comes to our mind when we start to ponder what went wrong with BYJUs is definitely its shady sales tactics. Unethical business practices must be avoided at all costs. Building trust through ethical sales tactics and responsible financial management is crucial for its long-term success. Implementing robust governance structures and ensuring regulatory compliance can prevent potential legal and reputational risks for the company. This incident has awakened the startup ecosystem to be more aware and empathetic of its strategies. The ed-tech sector may face heightened scrutiny regarding its business practices from investors, regulators, and consumers. Companies may need to prioritise ethical sales and marketing strategies to maintain consumer trust and to help them believe in their company again. Sustainable financial management and responsible debt practices may become crucial for maintaining potential investments. Conclusion In the words of Warren Buffet, "It takes 20 years to build a business but 5 minutes to ruin it," a sentiment that rings true in BYJU's journey. Once valued as India's most valuable startup at $22 billion, it now stands at a mere $3 billion. However, the rapid rise and fall of BYJUs serve as a poignant reminder of the necessity for ethical practices, responsible growth, and robust governance in the EdTech industry and beyond. The journey of BYJUs, from innovation to uncertainty, stands as a cautionary tale within India's ed-tech landscape. Once hailed as a symbol of innovation and success, BYJUs experienced a dramatic downturn characterised by financial crises and legal disputes. Its fall underscores the vital importance of ethical business practices and sustainable growth strategies in the startup ecosystem. As BYJUs initiates restructuring efforts and faces legal challenges, the incident underscores the critical need for transparency, responsible financial management, and adherence to regulatory compliance. Sources Fincash Moneycontrol The Economic Times Authors: Manan Alagh and Mayank Kumar Illustration: Prateek

Paytm vs. Regulations: Will it Fly Again? The Rise of the Wallet Wizard You might have paid your kirane wala and heard "Paytm karo", satisfying isn't it? Transforming an economy that solely relied on cash to an economy that started dealing in cashless transactions more often, Paytm emerged as a game changer. Paytm, initially founded as a mobile wallet-based startup, commenced its journey in 2010. Cheered by many, the prominent fintech startup has done much more to celebrate than just mere numbers. Nonetheless, it is to be acknowledged that Paytm has hunted significant glory across India recently. The master plan kicked things off with people paying for bills and recharges. The user base of Paytm showed a meteoric rise from 1.18 Crores to 10.4 Crores recording a significant 781% growth from August 2014 to the same month in 2015. This performance was owed to the introduction of its own mobile wallet and collaboration with the heart of retail grocery purchase – The Kirana Stores. The seamless integration of technology into payments whispered an easy-to-understand and convenient payment system into the ears of Indians. The revolutionary emergence didn’t stop there. Rather it intensified further when the Indian government made 500 and 1000 RS notes cease as legal tenders and called for digitalization of the economy in one way or another. This shift made Paytm the go-to platform to support Indian payments’ digitalization. Let alone looking back, Paytm moved forward aggressively with its compelling marketing strategies for tier 2 and 3 cities. The infusion of Unified digital payments (UPI) by the Indian government in 2016 and the acquisition of a license to operate as a full-fledged bank in 2021 further immersed the fintech giant in success. Cracks in the Facade Most of today’s Indian markets are fiercely competitive and the Indian fintech market is no different with major competitors like PhonePe, Google Pay, and Amazon Pay along with new entrants hindering Paytm’s business objectives while vying for market share. Paytm’s initial excitement started to wear off over time due to the new entrants offering lucrative offers to acquire customers. Many question Paytm over the unsustainability of its business model, arguing that it relies heavily on discounts and cashback offers, eventually questioning the long-term profitability of the adorned startup with Macquarie research report going so far as saying  ”Paytm’s business model lacks direction and focus”. On top of that, Warren Buffet’s only Indian investment didn’t live up to the hype it had when it underwent the IPO listing. The One97 Communications subsidiary was alleged to be overpriced at the same time. The expectations of the IPO soaring on the initial day of listing were hit when its opening price fell apart and recorded a 27% decrease on the opening day. Furthermore, the Paytm Mall, the e-commerce diversification of Paytm, had been allegedly involved in a major data breach in 2018 on 30 August. Not only this, Paytm Mall was never found good enough to be profitable as it crashed heavily on the front of valuation as it curtailed from $3 billion in 2019 to $13 Million. A forgettable journey for Paytm, isn’t it? Unfortunately, the attempt to mark a significant presence in the insurance sector was found to be a vain attempt. The unsuccessful diversifications into new segments along with frequent regulatory blows added to the woes of the pioneer in mobile payments apps. The Regulatory Hammer Blow The Reserve Bank of India wielded its regulatory hammer with precision, delivering a crippling blow to Paytm Payments Bank. The fallout from this action reverberated through the financial ecosystem, leaving scars on growth prospects and investor sentiment. The company’s stock plummeted by 20% in one day. This sharp decline wiped out approximately ₹609 per share, erasing around $1.2 billion in value from the company It all started in 2019 when the Office of Banking Ombudsman (a body created by the RBI to take care of the banking complaints of the general public in India) issued a show-cause notice for Paytm Payments Bank’s failure to monitor a certain account maintained with it that had shown a sudden increase in the velocity of daily transactions involving immediate transfer to other banks. These actions were found to be in violation of RBI’s provisions on KYC norms. In July 2021, the central bank issued a show-cause notice to Paytm for submitting false information about the transfer of an operating unit from One 97 Communications to Paytm. By October the same year, Paytm was charged a ₹1 crore penalty for contravention of the Payment and Settlement Systems Act, 2007. From the RBI’s point of view, a row of red flags was popping up: Paytm did not monitor payout transactions or carry out risk profiling of entities availing those services. In several cases, the regulatory ceiling of end-of-day balance in customer advance accounts was breached. The banking regulator also found that Paytm Payments Bank had reported a cyber security incident late, and had failed to implement device-binding control measures related to “SMS delivery receipt check”. In October 2023, another penalty of Rs.5.93 crore was imposed on the payments bank after the RBI found several non-compliances—once again highlighting the bank’s failures around the identification of account owners. While reports pointed to money laundering concerns, Paytm and its management vociferously denied any such violation. However, the final blow came in 2024. The Comprehensive System Audit report, coupled with compliance validation by external auditors, exposed glaring lapses. Paytm’s transgressions ranged from failing to identify beneficial owners to breaching regulatory balance limits. The RBI’s patience had worn thin, and it acted decisively. Paytm’s Stock price falling by 20% on the same day RBI issued the notice. During their deposit drought, the bank was prohibited from accepting further deposits or top-ups in various customer channels, including accounts, wallets, FASTags, and NCMC cards. Although customers retained the ability to withdraw or utilize their balances without constraints, the once-bustling banking services of Paytm came to a grinding halt with the suspension of fund transfers, Bharat bill payment operating unit (BBPOU), and UPI facilities. “The bigger issue is that Paytm has not been on the good books of the regulator and going forward, their lending partners also could possibly re-look at the relationships,” Macquarie analysts wrote after the RBI’s action against Paytm Payments Bank. Paytm, once a fintech disruptor, faced a seismic impact. Its growth stalled, and investor confidence wavered. We cross fingers as India asks, Can it regain trust? Is profitability still possible? Reflecting on a Larger Problem In the aftermath of the Paytm crisis, several key players come into focus. The Securities and Exchange Board of India (SEBI) appears sidelined—its hands wringing as an ineffective bystander. SEBI played no role in determining the IPO pricing or mitigating the stock’s subsequent hammering. Meanwhile, venture capital firms continue to wield immense power, often valuing businesses at staggering multiples. Paytm’s primary market debut, at 27 times enterprise value or gross profit for fiscal 2024, exemplifies this trend. Amidst this turmoil, India’s entrepreneurial ecosystem takes center stage. Start-up founders petition RBI Governor Shaktikanta Das and Finance Minister Nirmala Sitharaman, urging a reconsideration of the “proportionality of restrictions” on Paytm. Their plea underscores the broader impact on the payments bank, the fintech landscape, and the economy at large. With the RBI's sanctions worsening the woes, the fintech giant seeks remedy amidst the proliferation of doubt. One hopes, for the sake of Paytm’s depositors, investors, and users, that it is now time to do what is right rather than do what is braveThe rise and fall of Paytm serves as a cautionary tale within the rapidly evolving fintech sector. Its initial success was undeniable, but a series of missteps, combined with increased competition and regulatory scrutiny, have cast a shadow over its future. The RBI's actions send a clear message that compliance and sound financial practices are paramount, even for innovative disruptors. Whether Paytm can regain trust, navigate regulatory hurdles, and chart a path to sustainable profitability is a question that will define its future, and potentially shape the trajectory of the broader Indian fintech landscape. Authors : Sachkeerat Singh and Md Imran Illustrator: Kumari Janawi Sources: Verdict The Economic Times Linkedin

Imagine that feeling of ripping open a fresh CD or hearing that satisfying snap from a record, it must have been pretty cool. But let's be real, there was kind of a dark side to it, right? You were stuck with whatever the record companies decided you could have, like some kind of musical dictator. The whole industry felt locked down, tight as a drum. Owning an album was like a trophy, proof you were a true fan, but it wasn't easy for everyone to get their hands on them. This amazing music, trapped in plastic and cardboard, felt miles away for some, like a world you couldn't quite reach. Finding new stuff, and exploring different sounds, all of that was basically controlled by the industry, leaving us music lovers craving something more, something freer. While physical formats offered tangible ownership, convenience came at a premium, and accessibility struggled to keep pace. As piracy chipped away at profits, the industry faced a stark choice: adapt or fade into irrelevance. Little did anyone know, a digital revolution was brewing, ready to rewrite the melody of music forever. A Familiar, Yet Emerging Tune In 2008, something game-changing happened: Spotify. It was like CDs got a digital makeover, a breath of fresh air for music lovers. Forget those lame radio stations or cheesy pre-made playlists, Spotify was like handing you the mic – millions of songs, whenever you wanted, just a click away. It was a total revolution, promising music that was both easy to get and super convenient. But the question was, would this new way of listening play nice with the old music industry or would it be like a total discord - throwing everything into chaos? Hit play, because this next chapter's gonna be a real banger. Before Spotify's 2008 debut, the music industry resembled a well-used vinyl record – familiar, comfortable, yet resistant to change. A Digital Disruption So, Spotify was ready to take things to the next level. Unlike other music apps that flopped, Spotify clicked with listeners. Its unbeatable convenience, affordability, and vast music library made it an irresistible proposition. Remember Napster and Rhapsody? Yeah, they tried to shake things up, but they just weren't legal or user-friendly enough. Spotify wasn't just another online store selling tunes, it was a musical innovation. It was like three awesome things rolled into one: on-demand streaming, legal licensing, and a freemium model that everyone could dig. Millions of people went from listening to pre-made playlists that felt like cages to creating their own musical masterpieces. It was like a sonic revolution, with everyone contributing to a giant, global chorus. This symphony was conducted by fancy algorithms that somehow knew exactly what kind of music you were feeling, which was quite impressive. Analysing Tunes And Echoes Spotify's arrival wasn't just a click in the music industry's story; it sparked a revolution in music. Spotify proved to be a powerful weapon against piracy, offering a legal and convenient alternative to illegal downloads. In addition, its intelligent algorithms and curated playlists opened up the world of music discovery, helping indie artists reach new audiences. Although individual subscriptions on Spotify were inexpensive, the platform's extensive user base translated to substantial income for the music industry, contributing to its growth. But it wasn't all melodic harmonies and euphoric beats. Some artists felt they had been pinched by the low royalties per stream, raising questions about fair compensation. There were concerns about the growing power of streaming platforms to dictate content and influence what listeners listened to. Since algorithms tended to favour chart-toppers, there were chances that lesser-known genres and artists were lost in the shuffle of popularity playlists. The Spotify Symphony Grows Since day one, Spotify has been hitting it out of the park. It started as a small thing, but it totally blew up and now everyone uses it. With over 551 million users, it's no surprise Spotify changed the music game forever. Streaming, largely driven by Spotify's success, is now king, raking in over 73% of all music money. But it's not just about convenience anymore. Spotify changed how we listen to music, how we find new stuff, and how we connect with it. It's like a whole new way of experiencing music, and it's here to stay. Harmonising Perspectives Spotify's journey echoes a timeless lesson: adapt or fade. They exploded onto the scene with their freemium model, totally changing the music game. Everyone had access to tons of music, and even artists got a major boost. But a jarring note has emerged. Remember the joy of rewinding your favourite song or shuffling your own playlist? Recently, Spotify hit a sour note by restricting these features for free users. No more rewinding, limited song shuffling, and goodbye to endless queues. This move sparked an outcry, raising questions about Spotify's commitment to accessibility and user preferences. Can the industry rewrite this movement and achieve a harmonious resolution? The future melody depends on us all. Will we demand fairness for artists, advocate for accessibility, or simply hit pause on the industry's evolution? The final note is yet to be written. What part will you play? Authors: Alok Kumar Pandey and Kumari Janawi Illustration by: Cheruvu Sai Kartikeya Sources Forbes Medium The New York Times Business of Apps

Finished watching a new movie, and found yourself pondering how these movies mint money. From understanding how movies earn money to uncovering profit-sharing secrets, this journey is as engaging as a treasure hunt with Indiana Jones. Explore the world behind the silver screen, making it as enjoyable as a colourful Pixar animation and as thrilling as a classic Hollywood adventure. Let’s understand this movie mania: Now to begin, let’s first understand who are the various stakeholders associated with a movie so that we can better understand their financial interests. The major thing to understand is what each stakeholder expects from the film and how they will earn from the film. There are predominantly 3 key stakeholders that are involved in the making of a movie:- Production Houses, Distributors, and Exhibitors. Bringing a film to life is a thrilling, yet financially perilous journey. We can now delve into the cost borne by various stakeholders: Cost Breakdown Of Various Stakeholders: Production houses as you might have heard of Dharma, Yashraj Films, Red Chillies Entertainment, etc. bear the burden of creation, from nurturing the script to finalising the polished product. This includes talent and crew salaries (actors, directors, technicians), shooting expenses, editing fees, and post-production costs. Distributors act as the bridge between production and exhibition, acquiring the rights to screen the film. They incur acquisition costs, invest heavily in marketing and advertising, and face distribution expenses like creating physical copies and managing the logistics of film copies. Exhibitors, the final link in the chain, pay rental or screening fees to distributors for the right to showcase the film. They also bear operational costs like staff salaries, maintenance of theatres, and utility bills like electricity, water, etc. Showbiz Profit: Profit-Sharing Model Between Producers and Distributors: As we have understood the cost, let’s now unravel how these stakeholders earn. There are three common profit-sharing models between production houses (producers) and distributors: 1. Minimum Guarantee (MG) & Royalty: Think of this as a pact with a guaranteed minimum wage. The distributor pays the producer a guaranteed minimum amount, known as the Minimum Guarantee (MG), regardless of the film's performance. But this deal comes with strings attached. If the film shines and surpasses the MG, the distributor takes back the MG first, then showers the producer with a percentage of the box office (the royalty). However, if the film flops, the distributor absorbs the punch, covering the MG, and they bear the loss up to the MG, leaving their pockets lighter. 2. Commission Basis: This model is all about shared skin in the game. The distributor receives a commission or percentage (e.g. 30%) of the film's box office revenue. They act as a sales agent, taking a commission on every ticket sold. The higher the box office, the fatter their cut, but along with this producers’ share grows too! It's a commission-based rollercoaster – you share the highs and lows. But remember, if the film underperforms, the distributor might not lose their commission as they do not bear the film's losses directly they will just end up getting less commission, however, the producer might be left holding the empty popcorn bucket. 3. Selling Distribution Rights: This option is for the bold. The producer sells the complete distribution rights of the film to a distributor for a lump sum amount. It's like selling your house – you get the money upfront, but any future profits (or losses) belong to the new owner. It's a high-risk, high-reward gamble. The film could become a cult classic, giving up the producer the juicy share. Or, it could sink without a trace, leaving the producer with just the memories ( and the lump sum, of course! ). Profit-Sharing Dynamics: Distributors and Exhibitors There are generally two types of exhibitors: Single Screen Theatres and Multiplexes To begin, let's first explore the realm of single-screen theatres. The single-screen theatre pays a fixed percentage of the box office revenue to the distributor. Common ratios might range from 75-25 to 70-30, with the distributor retaining the larger share. Next, let's examine the multiplexes' perspective. It’s like understanding a dynamic partnership that keeps on changing weekly: - In the first week of a film's release, when audience turnout tends to be high, the revenue-sharing ratio is often set at an equal 50-50 split between the multiplex and the distributor. In the following weeks, the revenue-sharing ratio may continue to evolve, gradually favouring the multiplex. This could mean a shift to a 75-25 or 80-20 split. This adjustment acknowledges that the film's major draw has likely occurred in the first week. In the later stages of the film's run, especially when its box office performance has stabilised, the terms of the revenue-sharing model may become more negotiable based on specific agreements between the multiplex and the distributor. These are just the basics covered that will help you gear yourself for the further journey as we unfold the different realms of this industry. Now let’s unravel the intricacies of a word you would have always heard since your childhood no matter if it was during the Classic Hindi cinema era or Dharma taking up in the industry. “This movie made this much at the box office”. Always hear this, right? But have you ever found yourself wondering what it means? Allow me to decode this buzzword - 'Box Office Collection'. Hold on to your seats, I mean your devices. In contemporary times, the term ‘box office collection’ means earnings generated from the film's ticket sales at movie theatres. It represents the total amount of money collected by a movie during its theatrical run, indicating its popularity and commercial success. The box office figures are a key metric in the film industry, reflecting audience turnout and the overall reception of a movie in cinemas. Hope we got you covered with this term! As of now, you have understood the hidden game behind box office working. We would like to introduce you to another intriguing verse of this industry that would pique your interest. THE HIDDEN VERACITY Flop movies but high profits? A film is made of so many elements that it's not just one power at gameplay,  there are production houses, distribution houses, streaming platforms, and financial houses that sponsor movies. It’s important to understand a movie is a product that entrepreneurs who give their money and put their stake in the film at the end of the day just want good returns right? As they say, the biggest risk is to make a film. The only trust can be in the idea, the execution, and the audience. Some people believe that there's a "movie mafia" or a group of influential individuals who manipulate the box office numbers to make flop movies appear more successful than they are. The success or failure of a movie depends on various factors like marketing, audience reception, and overall quality. Sometimes a movie can resonate with audiences despite negative reviews. One possible explanation is that these movies have strong marketing campaigns that create a lot of buzz and attract a large audience, despite the negative reviews. Another theory is that these movies appeal to a specific niche audience that may not be well represented by critics. Additionally, some movies may have international success, making up for their underperformance domestically makes a huge difference. Earlier there used to be individual financiers and then after some years came big production houses like Dharma, Yashraj productions and turned the movie industry into a systematic structure. Companies were formed so that the risk was equally divided between people and large amounts of money could be raised. New tactics were applied by different production houses to make their movies a hit. New players, new plays The economy of one movie here was replaced by the economy of portfolio movies making it a different ballgame. For the big production houses - Eros, UTV, Reliance Entertainment, and of course, the unlisted Yashraj Films, the game-changer was the emergence of a robust A2A aggregator to aggregator model. This led to the emergence of diversified revenue streams and so, naturally, they were less dependent on the box office. The systematic level of output was decided and that was: 1) How many movies are to be acquired (outright purchase from independent producers), and how many are to be self-produced and co-produced? 2) How many big-budget, medium-budget, and small-budget movies to make? The portfolio works when there is an optimum mix of movies to get maximum returns. Rights A film is an intellectual property (framework of rights in law that protects “creation of the mind”), not a physical property. You can experience this but not sell it further. You can buy a ticket to go into the movie hall and experience the movie but that experience is only limited to you posting it online is simply illegal. So, production houses started giving their movie rights to television which resulted in high profits. The film industry not only started reaching every home but also maximised their popularity and profits. Gushing money Most movies these days are blockbusters! When multiplex came into India, production houses understood that they could make more money how? Simply by making tickets costly. Now what happened was an idea that even if fewer people see the movie more money could be made. Single screen crisis was seen earlier being 12000, but after the pandemic, they were left with only 6500. The only drawback was that the reach and their dependence on the hinterland audience were reduced. Flop movies started coming to OTT which benefited everyone. OTT platforms invested US 665 million dollars on content in 2021 leading this were Netflix, Amazon, and Hotstar. Ott platforms were earning money from more movies as the quality did not matter the quantity did. Everything covered till now be it the basics of making, profit sharing model, the finance and the budget. The hidden and less seen behind the big flimsy curtain and the mystery behind flop movies and high profits were just the tip of an iceberg that is deeply submerged, with its blocks deeply rooted in an ocean that is not only ice cold but deeply complex. To survive in an industry and be a part of it is a different experience altogether. It is a topic that could never get old and will always be relevant not only for entertainment, fun, and relaxation but also for escapism. Humans and their love for escapism is evergreen and a topic for next time. Till then ciao! We’ll see you soon! Authors: Sneha Sah and Kasvi Goel Illustrations: Kkaatyanshive Singh

Commuting from one place to another has always been an essential requirement of man, and different solutions have been proposed in different eras to fulfil this need. From navigating the city through physical maps to having the cab stop right in front of you with minimum effort, we have come a long way. New modes and technologies have repeatedly extended the boundaries of cities and changed the way we live, and definitely for the better. But what is Uber's significance in this transformation? How did it become the evident leader in this race? Read along to find out! FOLLOW THE YELLOW TRAIL Horse-drawn for-hire hackney carriages and hansom cabs used to rule the streets of Paris and London till 1834. But the neighs of horses were soon replaced by the horns of taxi cabs when the modern taxi meter was invented. By 1950, more than 12,000 taxicabs serviced New York. And as time passed, these vehicles spread like wildfire across the world. It was in 1958 that these iconic yellow ambassadors made an appearance in Kolkata, India. They quickly gained popularity and were crowned the ‘King of Roads’. All was well until the beginning of a customer-centric economy when people began to yearn for a more personalised experience. Taxis did not fit into this scenario. No doubt the taxi service was way better than using public transport but the question was "can something outdo this too?" And the start of ridesourcing services answered in the affirmative. THE NEW HOTSHOT IN TOWN The advent of Uber significantly transformed the transportation landscape. Instead of standing on the curbside and flailing your hand in frustration, you can now get a ride by simply tapping on your phone. Uber started when Travis Kalanick and Garrett Camp found themselves stuck in Paris on a snowy evening, unable to find a taxi, and decided to find a solution to this universal problem. The journey from this humble beginning in 2009 to a market leader has been quite rapid. Uber has seen its fair share of CEOs, from Ryan Graves and Travis Kalanic to Dara Khosrowshahi. Almost ten years later, with 75 million global customers and 3 million dedicated drivers in 83 countries, Uber has made black the new yellow by being a legitimate game-changer in the ride-sharing services market. NAVIGATING THE SUCCESS To put it simply, uber is an app that connects drivers with riders by using a multi-sided platform business model. Uber focuses predominantly on the customers and their satisfaction, which is its major differentiator from traditional taxis. To book a ride, all you need to do is enter your current location and the desired destination, and the platform will provide you with multiple vehicle options, from auto rickshaws and motorcycles to sedans and SUVs. Uber, like other ride-sourcing services, aims to have an organized driver base, which is again a revolutionizing aspect. As soon as you request a ride, the platform informs the nearby available drivers who then have the option to accept or decline your request, based on their convenience. Avoiding the taximeter, the ride fare is calculated by an Uber algorithm, considering the distance travelled, elapsed time, and the fuel used. On Uber’s side of the coin, the total value of each ride includes the driver’s payment, fees, taxes, and company commission. Being a globally successful company makes it an attractive platform for brand promotions, adding to the revenue. THE ROAD TO SUCCESS Born in 2009, Uber started as a luxury ride with co-founder Camp's vision. By 2012, it democratized the service with UberX, letting regular cars join the fleet. Innovation continued with carpooling in 2014, followed by Uber Eats for food delivery (though later eaten by Zomato in India). In 2019, Uber dabbled in temporary jobs with Uber Works before sunsetting it in 2020. In the early years uber spent virtually no money on marketing, relying instead on word of mouth to spread. Uber has not only captured but created its market. A fun case story, in the initial stages of Uber, Uber drivers need not have any commercial registration, special licensing, or regular checks as traditional taxis require. All these expenses were curbed and Uber was able to charge a comparatively cheaper fare. But were they playing fair? Ditching regulations meant ethical concerns and legal clashes. "We're a tech company, not a taxi!" They argued, winning some courts over. This strategy did not work in all countries. Uber cooperated with the legal norms to some extent. Gradually Uber had to invest to compete with other players. Uber is today operating in over 70 countries and more than 10,000 cities. WHO ELSE IS ON THE RACE TRACK? Late at a party? Does the night owl need a ride? Uber's your guide, From dancing 'til dawn to catching the dawn, on a sunny or a windy, Uber’s your buddy. Looking at its competitors, Lyft is a competitor of Uber at a global level. However, Lyft only has its operations in the US and Canada while Uber is currently operating in 70 countries and over 10,500 cities worldwide. Uber, king of the ride-hailing castle with a 68% crown, and Lyft, its 31% squire, both galloped towards Wall Street in December 2018. While Uber, valued at a jaw-dropping $120 billion, secured its royal IPO, Lyft aimed for a $2 billion treasure chest. Some other competitors are trying to fit themselves into the market that Uber has established. Ola is an Indian startup which is inspired by Uber. Ola has more revenue than Uber in India. Ola's ride-hailing sales (cab bookings) climbed 63% to Rs 1,987 crore, whereas Uber's revenues in the business grew by 75% to Rs 678 crore. Ola is like a local expert knowing the Indian market well. Uber, on the other hand, is an experienced traveller on a global scale. Finishing Point Uber's success highlights the potential of technology to streamline industries and empower users. It brings an end to the negotiations that we had to deal with the local taxi drivers. However, we cannot fully depend on Uber or such technologies because of unpredictable wait times and surge pricing. In many tier 2 and 3 cities, local drivers own the kingdom. Uber became a company that brought major disruption to the commendable technology. Uber came out of the blue and splashed yellow all around. You need not be the navigator of your driver anymore, LET THE UBER NAVIGATE THE CHAOS. SOURCES Uber Business Insider Investopedia Authors: Anshul Sethi and Yashika Choudhary Illustration: Saket Malhotra

From the era of roaming around Blockbuster's shelves for a movie, we have come upon the modern times where we can find one by browsing online libraries. DVDs have turned to mobile apps, one-time rentals have evolved into subscription models and movie nights are being replaced by binge-watching. But what lay behind the scenes of our changing entertainment landscape, where the once-mighty industry giant is now relegated to a realm of nostalgia? (Spoiler Alert: Netflix’s Entry) In the fast-paced world of entertainment, where we observe OTT platforms fighting to acquire a better market share, one movie rental company and the ex-global leader in this space, Blockbuster witnessed its decline and filed for bankruptcy. Join us as we narrate how Netflix, coming out of the blue, shook up the whole entertainment world leaving Blockbuster in the dust. A Blockbuster beginning Blockbuster was founded in 1985 by David Cook and emerged as a cinematic first mover advantage to the increasing demand for VHS (Video Home System) movie rentals. With a unique revenue-sharing model in the mid-1980s, Blockbuster acquired videos inexpensively, retaining 60% of rental fees and sharing 40% with studios. At its peak in 2004, Blockbuster employed 84,300 people worldwide and operated 9,094 stores. Blockbuster's strategy prioritised stocking popular films and making sure that no one leaves empty-handed. The company's success came from offering affordable rentals when movies were not readily available. This approach allowed customers a trilogy of choices—rent, wait, or buy at higher retail prices from competitors. All this made Blockbuster an undisputed star in the movie rental industry. But this fame was short-lived as things were about to take a bad turn. The Real “Blockbuster” Then came Netflix, and everything went haywire for the OG. Although Blockbuster's demise wasn't solely due to Netflix, the massive debt kept on increasing, and the hopeless pursuit of rapid expansion also played the villain’s role. Netflix became the master of adaptation, and Blockbuster lost its sole purpose, which was to deliver entertainment. The future of streaming was in front of everyone’s eyes and was duly recognised by Blockbuster as well, but they were just not able to compete in this digital run. Failure to understand that change is the only constant sealed Blockbuster's fate. The non-customer-centric approach of Blockbuster also played a role—Blockbuster's reliance on late fees alienated customers, while Netflix prioritised user satisfaction. All this led to the new generation of cinema led by Netflix, which made Blockbuster a mere spectator of its greatness. Netflix and Chill Amidst Blockbuster's demise, a lone fort in Bend, Oregon, navigated through the digital age. This store, owned and operated by franchisee Sandi Harding, defied all odds and became a nostalgic refuge. In 2020, the Bend store made headlines on Airbnb, offering an "End of Summer Sleepover," allowing guests to relive the '90s with a sleepover in the world's last Blockbuster. By July 2018, it stood as the last Blockbuster in the U.S., and by March 2019, it was the last globally. In contrast, Netflix, the streaming giant, our real blockbuster, boasts 8.3 million paying customers and 240 million global subscribers, with a revenue of $31.6 billion in 2022. They are available in 190 countries, with 20% of the OTT market in India. The Climax in Blockbuster’s Dream Could Blockbuster have painted a different picture, preserving the industry's hues of yellow and blue, rather than witnessing the market turn to shades of red? Perhaps. The initial step could have been revisiting the first chapter of its story. Blockbuster wasn't just a video rental retail space –it was a source of entertainment. Even the roots of its initial market dominance lay precisely in this defining factor. Subsequently, prioritising customers is the supreme law. A revenue model relying on charging late fees (no matter how lucrative) is not the most customer-driven approach. The company could have focused on providing affordable entertainment rather than sticking to its prevalent and comfortable model. Another layer to this perspective includes the possibility of using “disruptive technologies” not persisting well due to the internal structure of the company. It could have happened with Blockbuster, so what now? Well, they could have either acquired Netflix, the pioneer, as they were offered (Yes! Reed Hastings came to Blockbuster to offer Netflix) or they would have created a business unit to experiment with the emerging tech trends. The potential success for this would lie in allowing the chosen online business structure to run independently. Thus, if the company could have agreed to adapt to the ever-evolving changes in the industry (and technology) the narrative would have been very different. A Critic’s Review The battle between Blockbuster and Netflix can be regarded as one of the greatest business case studies of modern times. At its core, this narrative imparts a crucial lesson: Focus on what you do, not just what you've done. For organisations inherently designed to make entertainment easily accessible, the key is to stay committed to that mission. It is widely accepted that this was a story of transition where the old is replaced by the new. The truth is that it wasn’t this simple. If Blockbuster hadn’t turned the gun on themselves, it would have been Netflix receiving the killer bullet. As is the case with most things in life, it was a nuanced situation. There was a perfect storm of poor decisions, technological advances and other contributing factors that led to Netflix’s staggering growth…and Blockbuster’s equally staggering decline. Authors: Hardik Jain and Sehaz Nagpal Sources Forbes Finshots Business Insider Medium

Finance Minister Nirmala Sitharaman on February 1, Thursday, announced an Interim Budget, striking a balance between the government’s achievements in the last 10 years and setting out a comprehensive plan for economic growth and fiscal prudence. Backed by the ‘Vote on Account’ clause of Article 116 of the Indian Constitution, an interim budget is like a financial pitstop during a government transition allowing it to get approval for crucial spending to keep things running smoothly in the interim, i.e. before the new government gets elected. This was the last Budget presented by the National Democratic Alliance before the general elections shall take place in May 2024. Highlighting the achievements of the government in the past 10 years, FM outlined how loans worth ₹30 CR were disbursed to women, the unemployment rate went down by 2.8% and ₹ 1.4 CR youth have been upskilled.  The government, amid a sharp slowdown in agricultural growth, relative underperformance of the rural economy and high food inflation, focused on fiscal consolidation and inclusive development as the budget showed a correction in the fiscal deficit being reduced to 5.8% of the GDP for FY24. This non-inflationary budget aims to bring down the borrowing costs of the government and lower retail inflation to its permissible levels. The vision of  'Viksit Bharat' by 2047 has been elevated by increasing the capex outlay by 17% to 11.1 trillion. Using “Sabka Saath, Sabka Vikas'' as its mantra, the government covers diverse communities in terms of caste and class to promote social justice. By empowering 25 CR people, the government focused on ‘Garib Kalyaan’ by laying down programs like PM Awas Yojana, PM Gati Shakti and PM Jan Dhan emphasising a paradigm shift from poverty alleviation to empowering the poor. Women empowerment also remained as a focal point in this year’s budget with FM outlining recent reforms like one-third reservation of seats in Lok Sabha and State assemblies, outlawing triple Talaq and disbursing 34CR Mudra Yojana loans to women entrepreneurs. FM in her speech redefined GDP as Governance, Development and Performance which showed a change in the government’s approach towards the economy. Unlike last year, there was no change in taxation and the budget remained quiet regarding divestments raising concerns by the masses, but the government did lay out their vision for a developed nation in the next 100 years of independence, the ‘Kartavya Kaal’. INFRASTRUCTURE The recent trend in budget figures underscores the growing importance of infrastructure. In alignment with this trajectory, the interim budget reveals an 11.1% increase in capital expenditure (capex), reaching ₹11.1 lakh crore, constituting 3.4% of GDP. This affirms the government's commitment to strategic investments, both public and private. Notably, this year's budget zooms in on transportation infrastructure, with key programs targeting economic railway corridors—energy, mineral, and cement, Port-connectivity, and High-traffic density corridors. The aviation sector, having experienced significant growth, will continue expanding with plans to develop new airports, enhancing connectivity and boosting tourism. The social infrastructure front also sees a spotlight, particularly in housing. The announcement to build an additional 2 crore houses under Pradhan Mantri Awas Yojana signals intensified focus, promising increased investments in the construction sector and a positive ripple effect across related industries. GOING GREEN With climate change moving to the forefront of every country’s agenda, the interim budget outlines a commitment to achieving ‘net-zero’ emissions of greenhouse gases by 2070 through key initiatives. The government propels renewable energy with viability gap funding for a one Gigawatt (GW) wind energy capacity. To kickstart the plan, the government plans to establish 100 million tonnes of coal gasification and liquefaction facilities by 2030. Mandatory blending of CNG and PNG with compressed biogas enhances sustainability in transportation and domestic use. The government aims to foster economic synergies through initiatives promoting E-buses, strengthening the e-vehicle ecosystem, and endorsing bio-manufacturing. Emphasis on eco-friendly alternatives like biodegradable polymers, bio-plastics, and bio-pharmaceuticals aligns with sustainable development goals for a greener future. ELECTRICITY Doubling down on green ambitions, India's rooftop solar program sees a budget surge from ₹2,167 crore to ₹4,555 crore. Targeting wider household adoption, the initiative offers one crore homes 300 free electricity units monthly, leading to savings of up to ₹18,000 from free electricity and selling the surplus to distribution companies. This scheme creates a synergy between households and corporates, enabling the country to have productive infrastructure. This will also have a greater impact on economic growth through the creation of entrepreneurship and employment opportunities for the supply, installation and maintenance of solar energy systems. This can also boost the EV ecosystem as the charging stations with solar rooftop facilities are economically more viable than those with a grid. HEALTH The government's focus on bolstering health infrastructure and preventive measures involves encouraging vaccinations for girls aged 9 to 14 to prevent cervical cancer. Plans include establishing more medical colleges using existing hospital infrastructure. The U-WIN platform manages immunization, with expanded efforts through the Mission Indradhanush campaign. Notably, the Ayushman Bharat scheme now extends healthcare coverage to ASHA workers, Anganwadi Workers, and helpers. While promising, the success of these decisions depends on their effective implementation. TAXATION The budget's focal point for the common man, taxation, sees no alterations in direct and indirect taxes, signalling government confidence amid impending elections. To ease the burden, the finance minister proposes withdrawing outstanding direct tax demands up to ₹25,000 for FY 2009-10 and up to ₹10,000 for FY 2010-11 to 2014-15, enhancing the ease of living for taxpayers. Additionally, tax benefits for startups, sovereign wealth or pension funds, and specific IFSC units extend to March 31, 2025, fostering continuity and growth. The corporate tax rate sees a positive shift, reducing to 22% for existing domestic companies and 15% for new manufacturing companies, aligning with the government's push for manufacturing sector encouragement. AGRICULTURE The government has had success with past schemes, such as the Pradhan Mantri Kisan Sampada Yojana and the Pradhan Mantri Formalisation of Micro Food Processing Enterprises Yojana, which have effectively supported farmers and the food processing industry. As a result, the government plans to introduce further public and private investment in post-harvest activities. Under the PM Formalisation of Micro Food Processing Enterprises scheme, the government has increased the allocation from ₹639 crores to ₹880 crores. Additionally, after the success of Nano Urea, the government plans to focus on the application of Nano-DAP in all agro-climatic zones. The allocation for the Fertilisers Department in this budget is ₹1,65,150.81 crores. The Atmanirbhar Oilseeds Abhiyan strategy helps gain Atmanirbharta on oil seeds. This step aims to promote self-reliance in the oil market, as India currently imports around 150 lakh tonnes of edible oil, which is 60 per cent of its domestic consumption. Lastly, a comprehensive program for dairy development will be formulated. IMPACT OF THE REPORT CARD General Elections The FM while announcing the budget expressed her confidence about coming into power for the third time after the general elections. The budget, notably lacking major populist moves, may wield limited influence on elections, aligning with the government's steadfast political-economic strategy. It accentuates welfare measures and narrative-building, underscoring the commitment to garner diverse demographic support. Strategically, it addresses societal concerns, particularly targeting farmers, women, and youth, preempting potential caste-based political exploitation. The government's emphasis on social justice and effective governance aims to solidify backing, employing initiatives like the Lakhpati Didi scheme. The budget, with its strategic governance approach, navigates diverse social issues, preventing divisive caste-based politics. While showcasing a thoughtful strategy, its direct impact on election outcomes remains uncertain, given the multifaceted dynamics in the political landscape. Boost in Growth The government's budget strategy centres on propelling economic growth through increased private sector investments, infrastructure enhancement, and renewable energy initiatives. By reducing central government borrowings, the budget aims to boost private sector credit availability, leveraging expected economic growth and favourable conditions. While emphasizing the private sector's role in driving growth, funds are allocated for critical infrastructure and initiatives like subsidizing rooftop solar panels and promoting biogas blending. Concerns linger about addressing challenges like underperforming private consumption and labour market disparities. Success depends on navigating political challenges, addressing resource deficiencies, and fostering an environment conducive to sustained economic expansion. Nudging Reforms The budget prioritizes sustainable, long-term solutions, adjusting tariffs and incentivizing investments in crucial sectors. Collaborating with state governments and addressing demographic challenges reflects a commitment to inclusive growth. Countercyclical fiscal policies indicate a pragmatic approach to managing economic fluctuations. Focusing on targeted reforms, the budget seeks to lay the groundwork for sustained economic development, positioning India towards becoming a developed nation by 2047. Fiscal Prudence The interim budget's emphasis on fiscal discipline, consolidation, and formal sector participation underscores the government's commitment to robust growth. Relying on revenue, reducing subsidies, and maintaining prudent fiscal management aim to create an environment for sustained expansion. Success hinges on external economic stability, with geopolitical shocks posing potential risks. The overarching objective is clear: to drive significant growth while ensuring responsible fiscal management. Authors: Anant Kumar, Neha Agarwal, Sai Advaith Kandi, Sanvi Khandelwal Illustrator: Japneet Singh