JSW's commercial EV ambitions, IPL's unique salary cap
Welcome to Top of the Morning by Mint, your weekday newscast that brings you five major stories from the world of business. It's Thursday, March 21, 2024. My name is Nelson John. Let's get started:
Markets stayed largely flat on Wednesday. Benchmark indices Sensex and Nifty increased marginally by around 0.1 percent each. 2024 hasn't been very kind: Sensex and Nifty have both been flat since the start of the year.
Compare that to Nvidia, the US-based tech company. Nvidia is up more than 80 percent since the turn of the calendar. Nvidia is one of the few companies that can mass-produce the hardware needed to make artificial intelligence work on computers. Shouvik Das, Mint's tech correspondent, writes from San Jose in California about a speech given by Nvidia's CEO Jensen Huang. Huang said he was bullish on India, and said that India developing AI is crucial for the global markets. The government recently approved a billion-dollar fund for this very purpose, so Huang's bullishness is understandable.
Despite the generall market lull, one stock that has done well on the Indian markets has been Zomato. It's up 33% on the year, and hit its upper circuit of 5 percent yesterday. That surge could be attributed to its plan to introduce a vegetarian-only fleet. But, as Mint's startup and new economy reporter Priyamvada C explains, this could turn out to be a bad idea. She writes that while restaurants have always handled this segregation of food, Zomato wants to change that. There's also been concerns around discrimination about this decision, including a wanting to distinguish its vegetarian-only delivery personnel through green clothes. This plan was later rolled back, with Zomato's CEO Deepinder Goyal attributing it to the public backlash.
Sajjan Jindal, the industrialist and conglomerate, has long wanted to enter India's robust auto sector. The increase in adoption of electric vehicles provided a quick opening for JSW to enter auto making. It has decided to do this by manufacturing electric buses and trucks. Mint's auto correspondent Alisha Sachdev reports that JSW is looking for a partner to set up a manufacturing unit in Odisha. This unit will be set up at a cost of 40,000 crore rupees. It's an interesting move by the steel and energy conglomerate to enter the commercial vehicle section as well. It was earlier reported that JSW will tie-up with MG Motors to enter the passenger vehicles segment in India.
JSW isn't the only one bullish on the EV segment: the central government wants conventional automakers to transition to electric vehicles as well. To that end, the government is creating a long-term playbook to develop India as a hub for automobile manufacturing. Mint's special correspondent Rituraj Baruah reports that the Centre is working to set up this automotive mission plan that is intended for EVs only, but might include traditional petrol and diesel vehicles too. This will be aligned with the BJP government's 'Vision 2047' plan as well, sources told Rituraj.
The Indian Premier League is starting soon. A huge part of its fervour actually starts a couple of months before the players even take to the pitch: the IPL auctions. Australian fast bowler Mitchell Starc became the most expensive player ever in the history of the league when the Kolkata Knight Riders bought him for a whopping 24.75 crore rupees. That was a fourth of the team's entire budget, called a salary cap. It was instituted to ensure there's no uneven spending. But the cricketing spectacle is a money-making machine: the broadcasting rights alone cost above 9,000 crore rupees a year. So compared to that revenue split amongst 10 teams, 100 crores on just player salaries seems low. Our partners at how indialives . com breakdown the IPL’s economics, comparing it with other sports leagues such as football, basketball, and baseball, which allot anywhere between 50 to 80 percent of the league's revenue players’ salaries.
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