| | | Question of the Week In the 1970s, when Singapore Airlines was preparing to take to the skies, which Asian airline was its inspiration regarding service standards? | | |  | Here's a great value proposition A digital subscription to Mint premium can be yours at just ₹213 per month. Check out the convenient and affordable plans we have for you here. | | Good Morning | | The News in Summary Zee founder Subhash Chandra and his son Punit Goenka were banned by Sebi from holding any directorship or key managerial position in a listed company after the market regulator found them guilty of siphoning off funds. Bad news, too, for TCS, as one of its largest clients, Transamerica Life Insurance, scrapped a $2 billion contract midway into its 10-year term. Elsewhere, Singapore Airlines may raise its stake in Air India from 26.1% to 40% while the Shapoorji Pallonji group faces tough terms in its efforts to raise $1.7 billion for debt repayment and working capital needs. No such problems for Reliance Industries, which will raise loans worth $2 billion to fund its growth plans. | | | | Huge Setback for Subhash Chandra and Son  Past actions caught up with Subhash Chandra as the Securities & Exchange Board of India (Sebi) banned the chairman of the Essel Group, along with his son Punit Goenka, the chief executive officer of Zee Entertainment Enterprises (ZEEL), from holding any position as director or Key Managerial Personnel (KMP) in a listed company or its subsidiaries. The interim order, which was promptly challenged by the Zee promoter, came after the regulator found that Chandra and Goenka had abused their positions as directors/KMPs of listed companies to siphon off funds from their listed entity ZEEL for their own benefits. In its detailed report, Sebi put out data to show that ZEEL and other listed companies of the Essel Group had transferred Rs 143.90 crore to falsely portray repayment of due amounts to ZEEL from seven associate entities also owned by family members of Chandra and Goenka. While the two men immediately moved the Securities Appellate Tribunal (SAT) against the Sebi order, there was no interim relief for them, with the tribunal directing Sebi to respond to their plea within 48 hours before it could give its ruling. The order is certain to jeopardize Zee’s merger with Sony Pictures Networks India, for which it is currently seeking regulatory approvals. | | | | IT Headwinds Hit TCS as Transamerica Scraps Big Contract  Tata Consultancy Services (TCS) suffered a major reverse with Transamerica Life Insurance Co, the American arm of Dutch insurer Aegon NV, scrapping a $2 billion, 10-year deal five-and-a-half years after giving the contract to India’s IT services market leader in January 2018. The move is a part of Transamerica’s plans to cut its dependence on third-party IT services firms and bring much of the tech work in-house. With the transition expected to take another 24-30 months, taking the contract into its 8th year, its financial implications may not be very severe. But with global corporations taking a relook at their tech spending on account of fears of an economic slowdown, the loss of a marquee client will add to TCS’s woes at a time when its new chief executive, K. Krithivasan, is still finding his feet. Termination of one of its biggest deals, a rare instance of a mega IT contract being called off even before the ongoing partnership has ended, will also send the wrong signals to the market where the stock is already down 15% since the beginning of the year. | | |  | | | | | | | | In this podcast, Dana Peterson, Chief Economist & Center Leader of Economy, Strategy & Finance at The Conference Board, breaks down the chances of a recession in the digital economy: | | | | Singapore Airlines May Up Stake in Air India Singapore Airlines (SIA) could be looking to raise its stake in Air India (AI) from the current 25.1% to about 40% once its current joint venture Vistara’s merger with the former public sector airline, is complete. The move is driven by SIA’s return to bumper profits after three successive annual losses and the growing potential of the Indian market, which is rapidly becoming a two-horse race between the Tata group and current market leader IndiGo, whose market share just hit a record high of 61.4%. A bigger stake will mean a bigger role in the JV for SIA, which was named the best international airline by Travel + Leisure magazine for 27 years running, in improving the service standards of Air India through better training and processes. Its expertise will also help AI better manage its ground services, including aircraft maintenance. SIA and Tata have a history of collaboration, though an Indian operation continued to elude them through the 1990s. The two companies finally cemented a joint venture in November 2013 when TATA SIA Airlines Ltd, the holding company of Vistara, was incorporated. | | | | Shapoorji Pallonji Group Faces Tough Terms for Loans In its efforts to raise $1.7 billion (Rs 13,500 crore) needed to meet its financial obligations, including bank repayments of Rs 4,400 crore, and prepayment of another Rs 3,250 crore in debt, the Shapoorji Pallonji (SP) group is facing tough terms. The conglomerate is believed to be promising investors a return of as much as 17.5% while putting up significant collateral, including half of its stake in Tata Sons Pvt. Ltd, two operational ports, and majority control of construction firm Afcons Infrastructure Ltd. Given its strained financials, the loans will come with a high-security cover reflecting investor concerns about the ability to monetize the Tata Sons stake in case of default as well as the low margins in the group’s flagship business of construction and engineering. Roiled by the death of patriarch Pallonji Mistry in June last year, followed by that of Cyrus Mistry in September, the SP group has been in the throes of a significant restructuring exercise whereby it will create two holding companies to house its diverse businesses. The immediate priority, though, is asset monetization for debt reduction and to raise working capital for its real estate and port businesses. | | | | Reliance Looking to Provide a $2 Billion Boost to its Growth Plans Reliance Industries is in discussions with lenders like Bank of America Corp, Citigroup Inc. and Standard Chartered Plc for a foreign-currency loan of up to $2 billion to fund capital expenditure of its various businesses and to refinance another loan that matures in September. After achieving net zero debt in 2020, the company has been raising fresh loans to fund its aggressive expansion plans, including an investment of $75 billion in the green energy business. But with its net profit of Rs 74,088 crore during FY23, up by 14% YoY from Rs 65,009 crore in FY22, and the continuing success of its newer businesses - Jio pipped rival Bharti Airtel in revenue market share in the fourth quarter of the fiscal year 2023 - raising fresh money isn’t a problem for India’s largest conglomerate. | | | | Last Word Much ado about nothing as State Bank of India chairman Dinesh Khara’s Rs 37 lakh annual salary for 2022-23 came up for comparison with that of his private sector peers like HDFC Bank’s chief executive officer Sashidhar Jagdishan who drew a salary of Rs 6.51 crore in fiscal 2021-22. Sure, SBI is a banking behemoth, with Khara managing a balance sheet more than twice that of HDFC Bank. But there’s nothing new about that. Public sector jobs come with their own perks, including job security. Khara, who joined SBI in 1984 as a probationary officer, obviously knew what he was getting into. | | | | Answer to the Question Singapore Airlines’s inspiration was none other than the Tata-run Air India. In his book Empires of the Sky—The Politics, Contests and Cartels of World Airlines, author Anthony Sampson writes that Air India inspired many other Asian airlines, including Cathay Pacific and Thai Airways. | | | Do you have any questions? Send in your queries to sundeepkkhanna@gmail.com Were you forwarded this email? Did you stumble upon it online? Sign up here. | | Written by Sundeep Khanna. Edited by Saikat Chatterjee. Produced by Shad Hasnain. Send in your feedback to newsletters@livemint.com. | | | | | Download the Mint app and read premium stories | | | | | | View in Browser | Privacy Policy | Contact us You received this email because you signed up for Mint Top of the Morning or because it is included in your subscription. Copyright © HT Digital Streams. 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