Good morning! They say anything is possible at a big fat Indian wedding. Teetotallers forget they’re teetotallers. People with two left feet forget they have two left feet. Guests’ stomachs perform somersaults after being subject to soda-laden food. And Masayoshi Son brings a Japanese business delegation to meet PM Modi. If your immediate thought after reading the last bit is ‘wtf?’, that’s what’s going to happen during or after the Delhi wedding of OYO founder and Son’s mentee, Ritesh Agarwal. Bloomberg says it’s a rare outing for the SoftBank honcho, who’s asked for Covid-negative tests from the people he’ll be meeting. Mukesh Ambani will be there too. Is this a wedding or an investor summit?

🎧 PM Modi is big on desi destination weddings. Also in today's edition: A divided world unites for The High Seas Treaty. Listen to The Signal Daily on Spotify, Apple Podcasts, Amazon Music, Google Podcasts, or wherever you get your podcasts.

Today’s edition also features pieces by Soumya Gupta and Srijonee Bhattacharjee.

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The Market Signal*

Stocks & economy: Indian shares may begin the week strong, tracking global peers which ended last week buoyant on the belief that both the US and the European bloc may avert a recession.

US equities rose as strong services sector data for February implied growth may withstand elevated rates. Bond yields still indicated higher rates for longer, but change in growth expectations may limit losses in shares. A similar story is seen unfolding in Europe where fears of degrowth had been more acute.

Investors are also preparing to live with China’s modest growth expectations for 2023.

Back home, shares are seen recovering from the past two weeks’ sell-off whenever valuations improved. Despite GQG partners’ purchase of shares of Adani Enterprise companies, how it meets repayment deadlines will be closely watched.

TECH

A Name Change In Vain?

Last year, we established that the metaverse is flopping. Even the executive whose job is to make the thing work admitted that the concept is struggling to find a product-market fit. So, why is Facebook-turned-Meta still stubborn about the metaverse?

The Verge argues that it shouldn’t be. Instead, the company—which has sold 15 million Quest 2 headsets, a feat comparable with gaming majors (20 million for the Xbox Series X and S, 21 million for Nintendo GameCube)—should focus on, well, games. The top apps on the Quest 2 are all games. Yet, Meta, which acquired three game developers, is forcing the metaverse onto users. The result: it’s now slashing prices of its flagship Meta Quest Pro due to poor sales.

In other news: Meta has rejected some recommendations by an external advisory group to reform its ‘cross check’ system, which gives VIP users greater protection than others.

BUSINESS OF SPORT

How FanCode Is Sachetising Sports Streaming

The streaming platform owned by sportstech unicorn Dream Sports has made a mark by offering single-match and tour passes for its sports properties. In this week’s edition of The Playbook, our weekly newsletter on the business of sports and gaming, Jaideep Vaidya interviews FanCode co-founder Yannick Colaco about sachet packaging in sports streaming and more. You can read the interview here and subscribe to The Playbook for free by hitting the button below.

ENERGY 

The Oil Trade-Off

The Indian government has slightly raised the windfall gains tax on locally produced crude oil, but cut it on diesel and aviation fuel exports.

The tax adjustments will make no difference to petrol pump prices or domestic airline tariffs, which have not changed since April 2022. This is despite refiners importing more and more Russian oil, which is deeply discounted for India.

Rush to profit: International oil prices will likely hit $100/barrel again if western and Chinese economic activity picks up. Oil companies are in a hurry to extract as much out of fossil fuels as possible before the world turns woke again.

For companies like Shell, a long-term, low-carbon vision has become harder to sell when US companies press shareholder-rewarding short-termism to milk the war-created opportunity. In 2022, 26 US oil companies paid out a mouth-watering $128 billion to shareholders.

CONSUMPTION

Urban Indians Are Going On Fewer Shopping Sprees

Affluent Indians—categorised as the top 20% of the population that accounts for ~66% of discretionary spending in the country—are no longer using pandemic-era savings to indulge their pent-up demand. Mint reports that several sectors are witnessing cooling urban consumption after Diwali 2022. Fewer people are ordering in and walking into quick-service restaurants. They’re also spending less on clothes, footwear, white goods, and beauty products.

Why’s this happening?: Indian households, which saved an extra $180 billion from 2020-2021, are holding onto their wallets due to a combination of price hikes and fewer formal sector jobs. The former is the result of rising input costs. The latter is the outcome of slowing global growth.

From shrinkflation to ‘premiumisation’: While companies catering to the mass market are shrinking packet sizes and keeping prices steady, American companies are enhancing existing products and pushing consumers towards these pricier purchases.

CHINA

Amrit Kaal 2017-2022

US President Joe Biden is giving the finishing touches to an executive order that will further curb investments in China, even as the latter wraps up its National People’s Congress, the annual parliament session.

Outgoing Premier Li Keqiang set the GDP goal for 2023 at 5%, triggering speculation of more curbs. Here are some numbers from the five-year report card:

High risks: Slack demand, unstable expectations of the private sector, difficulties in SME operations, employment instability, high budgetary imbalances of some local governments, hidden real estate market dangers, and imperilled financial institutions.

WELFARE

Shrunk Savings

Officials of the Employees’ Provident Fund Organisation (EPFO) say they expect to keep EPFO interest rates unchanged for this financial year. Last year’s 8.1% was the lowest interest rate offered in 40 years, and many account holders say they haven’t even received those interest payments yet. With inflation hovering near or over the Reserve Bank of India’s 2%-6% target, no interest-rate hike will hurt retired savers the most.

Flush with cash: Meanwhile, the EPFO has been investing up to 15% of its total corpus via exchange-traded funds (ETFs). Last financial year, it put in over ₹3 lakh crore (~$40 billion). It is also planning a host of measures to maximise returns, including a 10% return requirement to redeem the ETFs, a longer holding period of five years for better returns, and frequent redemptions to avoid market fluctuations.

FYI

Follow the rules: The RBI has slapped a fine of over ₹3 crore (~$370,000) on Amazon Pay for not complying with Know Your Customer (KYC) and prepaid payment guidelines.

No Signal: FTX founder Sam Bankman-Fried will have to use a flip phone or another “non-smartphone” without internet access while he’s out on bail, prosecutors said.

Saving the oceans: Countries have reached a landmark agreement to put 30% of the world’s oceans into protected areas by 2030 to safeguard marine life.

Data breach: Indian at-home salon service company Yes Madam exposed the sensitive data of customers and gig workers due to a server-side misconfiguration.

Back in the game: Essar Group is re-entering the steel business with new plants in Odisha, Saudi Arabia and the US at a cost of over $8 billion.

Boost: The production-linked incentives (PLI) scheme is now the mainstay of India’s manufacturing. Bicycle and toy makers will get a ₹7,000 crore (~$855 million) PLI prop.

Under watch: The Reserve Bank of India is keeping a tab on India’s 20 large conglomerates for signs of stress. It doesn’t want their troubles, if any, to leach into the banking sector.

THE DAILY DIGIT

>$750 billion

India's goods and services exports could cross the figure in FY2022-23, according to Commerce & Industry Minister, Piyush Goyal. (The Times of India)

FWIW

End of an era: Toblerone is ditching the iconic Matterhorn, the Swiss mountain, on its packaging. That’s because American parent Mondelez International is moving some of its production to Slovakia from Switzerland to save costs. The 'Swissness Act’ requires dairy products and cheese to contain 100% Swiss milk to earn the ‘Made in Switzerland’ tag. Mondelez’s previous attempts at doing away with the “peaks” had caused ire in the UK. In 2016, Nestle too had to part with the Swiss tag for similar reasons. Talk about Swiss soft power.

Under pressure: Kevin Hochman, chief of Brinker International—the American multinational that owns Chili’s Bar & Grill—is a man on a mission. And so far, his attempts to simplify operations have yielded mixed results. The chain has done away with metal french fry baskets (which required too much time to clean). It also scrapped original chicken crisps from its menu, reduced salad options, experimented with robots, and raised prices. Customers are grumbling, but investors are happy. Ah, well, you can’t please everybody.

Back to black: Now, this makes for an apocalyptic plot: an alcohol-fuelled fungus apocalypse that started with a bottle of Jack Daniel’s. The sooty substance, called whiskey fungus, is unsettling residents in Lincoln County, Tennessee. Seems that ethanol vapours are escaping from ageing barrels in Jack Daniel’s warehouses and “feeding” the fungus, which is growing on nearly every surface you can think of, even concrete. The local court has asked the whiskey brand to stop using six warehouses, and locals are urging the brand to install air filters to prevent the fungus from spreading further. Yikes.