- Arvind's Newsletter
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- Arvind's Newsletter
1.Here's Why India Is Morgan Stanley's Top Pick Among Emerging Markets
India is Morgan Stanley's top pick in the MSCI Emerging Market Index as the country is expected to 'structurally outperform', driven by nominal GDP growth, a focus on capital expenditure, and a global de-risking trend.
Valuation in Indian markets is at a premium due to strong fundamental reasons, Morgan Stanley said. "We see a secular trend towards sustained superior USD EPS growth versus EM over the cycle, with a young demographic profile supporting equity inflows." The investment firm sees India as the best domestic demand opportunity among other emerging markets.
The country's demographic trend is favourable due to the rise in the working-age population. India's public capital expenditure has risen to a 19-year high of 3.3% of GDP in FY24, while private capex has entered an upcycle phase.
India's weightage has increased to 11% in the MSCI Asia Pacific Index in January 2024, compared to 6% in January 2021, the investment firm said.
Morgan Stanley expects India to be the key driver of global growth in the 2020 decade, with its share of global growth estimated to increase by 18% in 2024. The country is expected to become the third-largest economy by 2027.
India could see close to $800 million to $1 billion in passive inflows of foreign funds.
Read more at: https://www.ndtvprofit.com/markets/heres-why-india-is-morgan-stanleys-top-pick-among-emerging-markets
Copyright © NDTV Profit
2.Has Uttar Pradesh’s economy surpassed Tamil Nadu?
Not even close. Data reveal gaping disparities, indicating Uttar Pradesh may take 64 years to catch up with Tamil Nadu’s per capita NSDP.
In a data-packed essay on Frontline, Tamil Nadu’s IT minister Palanivel Thiaga Rajan argues that Tamil Nadu has outperformed Uttar Pradesh in economic growth over the past 30 years.
“By per capita income, a better measure of economic progress, the southern state has fared better than Uttar Pradesh. Social indicators like health, education, poverty also show Tamil Nadu significantly outperforming Uttar Pradesh. This gap is a reason why poorer states receive net transfers of tax revenue from richer states. The expectation is that this will accelerate their growth. However, Uttar Pradesh has not done that. “
“Only when the GSDP of Uttar Pradesh exceeds that of Tamil Nadu, or becomes twice the size of Tamil Nadu, we can safely say that we are beginning to approach some sort of equity. The fact that the reverse is happening, with Uttar Pradesh growing slower than Tamil Nadu over the past two decades, even after huge transfer of funds from Tamil Nadu to Uttar Pradesh (through the increasingly skewed allocations of successive Finance Commissions, as well as the adoption of point-of-sale GST compared to point-of-production VAT & Excise) is an alarming trend from many perspectives. If we do not figure out a way to fix this issue, it bodes ill for the country’s future.
In my opinion, the single improvement that will yield the greatest results is to ensure greater inclusion and social justice in states like Uttar Pradesh, as is the case in states like Tamil Nadu—from education through participation in employment and entrepreneurship. It will take a generation for the benefits to be fully manifest. But it will yield lasting improvement. By contrast, all other steps are doomed to failure, unless this one is adopted.”
3.Tata Digital Explores Operational Integration of its Digital businesses
Tata Digital is exploring the integration of the operational structures of key group assets such as BigBasket, 1mg, and Tata Cliq to streamline operations, reduce costs, and enhance market responsiveness, said people familiar with the matter.
The flagship digital asset, BigBasket, is also looking to raise up to $100 million in funding from parent Tata Sons. It is likely to float a proposal for the same later this week as part of its annual operating plan, the people told ET.
Read more at:
https://economictimes.indiatimes.com/epaper/delhicapital/2024/feb/13/brands-companies/tata-digital-explores-operational-integration/articleshow/107639583.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
4.Generative artificial intelligence is transforming the advertising industry.
Cheap, obviously AI-generated ads promoting a range of goods have given way to more sophisticated campaigns. One food brand eschewed spending thousands of dollars on designing a new name and logo and instead “simply asked an AI chatbot for six ideas ams selected the best,” according to the Financial Times.
The market is changing, too: High-production television ads designed for mass consumption are on the decline, with the “dream” now being to create bespoke AI-powered ads aimed at individual consumers, one executive told the FT. The changes represent the biggest upheaval the ad industry has seen “since the arrival of the internet.”
At the start of the year, every single one of the roughly 100,000 people working for advertising giant Publicis received a video message from the chief executive thanking them personally, by name and in their first language, for their hard work. To film and edit so many messages would normally involve hundreds of hours of work, but it was much easier to pull off thanks to the industry’s new best friend: artificial intelligence.
Similar advertising campaigns are already being rolled out. In India, for example, thousands of local stores have generated their own versions of ads featuring Bollywood star Shah Rukh Khan urging people to shop locally in a campaign for Cadbury by WPP.
To avoid being left behind, both WPP and Publicis, two of the world’s largest agencies, have set out plans to spend hundreds of millions of pounds to embed AI in their businesses.
Read on
5.China’s Tesla Killer, reports New York Times
BYD, a Chinese electric vehicle company, passed Tesla in electric cars sold worldwide after its sales grew by a million cars in each of the past two years.
The company has a walled town in Shenzhen, where a monorail carries workers from 18-story apartment towers, and it is building the world’s largest car carrier ships. BYD has also begun setting up assembly lines across the world: Over 80 percent of its sales are in China, but exports to Europe are expanding.
“I think if there are not trade barriers established, they will pretty much demolish most other companies in the world,” Elon Musk, Tesla’s chief executive, said in January.
6.Economist Noah Smith provides a balanced update on Climate Change which I recommend you should read.
In summary he opines:
Climate change is starting to get severe.
Climate change is manageable, but we’re not there yet.
The U.S. and Europe are no longer the biggest problem.
Green energy is for real.
Cutting emissions doesn’t require de-growth.
Read on to be informed on the status of climate change based on his post.
7.Indian government to note :Vietnam is offering tax breaks and other incentives to semiconductor companies in a bid to become a global hub for high-tech manufacturing.
Nvidia and Samsung are already looking to expand their presence in Vietnam, which has one of the highest-rated education systems in the world and is preparing to train 50,000 semiconductor engineers by 2030, Nikkei reported.
Companies often see it as a less risky alternative to China: Apple recently shifted engineering resources for its iPad line to the country for the first time. But Hanoi faces stiff competition from nearby nations like Malaysia, where Austrian circuit board maker AT&S will soon open a new plant.
8.The Super Bowl gets some of the best advertising commercials. Here are the best of the best.
