Can defence stocks armour-plate your portfolio? Can AI bring back the dead?
Welcome to Top of the Morning by Mint, your weekday newscast that brings you five major stories from the world of business. It's Tuesday, July 2, 2024. My name is Nelson John. Let's get started:
The Indian market’s benchmark indices Nifty and Sensex both gained more than 0.5 per cent by the end of the trading session on Monday.
In a significant push to bolster the 'Make in India' initiative, the government is considering a Production-Linked Incentive scheme that could transform the railway sector. The scheme—likely to be introduced in the upcoming Union budget—will specifically target the manufacturing of certain railway components that we typically import. Now, what’s on the cards? The government is thinking about offering incentives ranging from 5-10% for locally produced products like wheels, axles, and braking systems, crucial for modern train sets such as the Vande Bharat and green trains running on alternative fuels like hydrogen. They've proposed this scheme to last three years with an expected incentive pool of ₹1,000-1,500 crore. Mint’s Subhash Narayan reports on the scheme, aimed at making our rail component industry more robust and competitive.
Indian investors have been showing unparalleled enthusiasm towards the defence sector–something that was seen post-world war 2 on Wall Street. Since its inception in January 2022, the Nifty India Defence Index has surged nearly 400%, overshadowing gains in other sectors. With India's significant military size and budget commitments to defence modernization, the sector presents a massive opportunity. In the fiscal year 2023-24, defence exports from India reached an all-time high, boosting investor optimism. However, the escalating stock prices have raised concerns about sustainability. Experts like Anirudh Garg from Invasset and George Thomas from Quantum AMC advise caution, pointing out that the sector might be overheated despite its growth potential. Mint’s Abhishek Mukherjee takes a detailed look at whether defence stocks can armour-plate your portfolio - in today’s Long Story.
Private investors are increasingly initiating forensic audits earlier in their relationships with portfolio companies, aiming to identify and address potential financial and governance issues preemptively. This shift comes in response to significant financial losses caused by mismanagement in high-profile startups, leading to a more proactive approach in risk management. Previously, audits were typically conducted after issues surfaced, but now, they're often triggered by early warning signs, enhancing the ability to manage risks effectively throughout the investment lifecycle. Mint’s startups correspondent Sneha Shah reports.
The first half of the year was packed with big Bollywood releases like Fighter, Bade Miyan Chote Miyan, and Maidaan, but even these star-studded films couldn't shake the Indian movie industry out of its slump. Box office collections dropped from ₹4,868 crore in the first half of 2023 to ₹3,000-3,500 crore this time around, also partly because we had almost no new films during the Lok Sabha election for about two months. Particularly, Bollywood's numbers were down by ₹400-500 crore. Despite these flops, there's a silver lining with some smaller films. Movies like Crew, Article 370, and Munjya did quite well, hinting that moviegoers are ready to return to the theatres if the content catches their eye. This shift towards smaller films is pretty stark compared to last year's blockbusters. But it's not all gloomy. Malayalam cinema has been doing surprisingly well, with several hits like Manjummel Boys and Aadujeevitham-The Goat Life easily crossing the ₹100 crore mark. It seems they've managed to rake in nearly 71% of their last year's total in just the first three months of 2024! Mint’s Lata Jha brings a wrapup of the first half of the year for India’s film industry.
The rise of digital avatars or 'deadbots' that allow us to interact with representations of the deceased is stirring both fascination and ethical debates. Companies like DeepBrain AI, HereAfter AI, and Eternime are pioneering services that enable the dead to have a form of digital presence, often inspired by popular media like the Pixar film Coco. The goal ranges from providing comfort and legacy planning to educational purposes, such as allowing students to interact with an avatar of Einstein discussing relativity. The potential of these technologies extends beyond simple memorials. They can perform at virtual concerts, offer family recipes, or guide medical students—almost like bringing the past into the present. Mint’s Leslie D’Monte explains what deadbots are in today’s Primer.
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Show notes:
Wheels, brakes and axles: Vande Bharat's parts makers may get a PLI horsepower
Gunning for glory: Can defence stocks armour-plate your portfolio?
Forensic auditors at startup doors as edgy investors look to fix issues early
At the box office, a dull first half punctuated by small moments of delight