Good morning! There’s a new podium finisher in the cola wars, and it isn’t even a cold brand. According to Beverage Digest, Dr Pepper has just tied with Pepsi as the No. 2 soft drink in the US by sales volume. To drive home how significant this is, Dr Pepper tied with Sprite for sixth place back in 2004, and Pepsi has consistently held the second spot since 1985. The Wall Street Journal reports that Dr Pepper, which is older even than Coke btw, has aged well thanks to great distribution and finding favour among Hispanic and Gen Z consumers. Gen Z’s affinity for Dr Pepper is mostly thanks to its sweeter flavour and social media posts featuring Stanley Cups filled with the drink, sometimes with bizarre concoctions such as pickles and chillies. As for the No. 1 spot: that steadfastly belongs to Coca-Cola.

Programming note: Two of our team members have a medical emergency. Since we’ve decided to take the day off, there will be no edition of The Signal on June 4.

The Market Signal*

Stocks & Economy: Asian markets rose on Monday on the probability of rate cuts in the EU.

Exit polls projecting a thumping win for the Narendra Modi-led NDA government spurred investor optimism to the point where a record start is expected of the Nifty 50. The GIFT Nifty, up by over 2.8%, indicates a strong opening for Indian stocks ahead as foreign private investors move to cover previous short positions quickly.

POLITICS

It’s The Final Countdown

Estimates predict a sweep for the BJP-led National Democratic Alliance (NDA) and a record third term for PM Modi, positing that the national party may not even have needed to ally with state heavyweights. Opposition bloc INDIA has rubbished the projections as “orchestrated” and are confident about an upset. We’ll save our two cents until June 4, because exit polls aren’t always accurate.

Regardless of which psephologists get it right or not, the common thread between all exit polls are the NDA’s supposed gains in south India and West Bengal, including an opening of the account in holdout Kerala.

Until then, here’s the real deal for states where counting is concluded: the BJP and Sikkim Krantikari Morcha have retained Arunachal Pradesh and Sikkim, respectively.

Nothing to cheer about: Thirty-three poll workers in Uttar Pradesh succumbed to heatstroke in the final phase of elections in the state on Saturday.

PODCAST

Tune in every Monday to Friday as financial journalist and host Govindraj Ethiraj gives you the most important take on the latest in business and economy.

In today’s episode, he speaks to Mihir Vora, CEO, Trust Mutual Fund, about why equities could hold a further rise. Also in today’s episode: India’s GDP numbers are on the upside, but economists now prefer to use Gross Value Added. Vivek Kumar, economist, QuantEco Research, explains why.

FINANCE

Building Block

The RBI’s draft infrastructure financing guidelines have left lenders in a rut. These guidelines propose that banks and non-banking financial companies (NBFCs) increase loan provisions from 0.4% to 5% during a project’s construction phase.

Why is this a problem?: Liquidity. Account holders are increasingly picking equity-linked instruments as investments and opting for short-tenure bank deposits of 2-5 years. Adding to this burden are risks associated with infra financing. These include land acquisition issues and loan repayment for major projects, such as highways, being possible only once they are fully functional. Lack of expertise in risk assessment has also left financial institutions exposed to bad loans.  

Banks and NBFCs may be pushed to disburse short-term infra loans to minimise risk in the wake of the RBI guidelines. Either that, or they find viable resources for liquidity to give out long-term loans. Head to The Core to find out what these resources are.

SPACE

Far Out

China’s Chang’e 6 lander touched down on the moon’s South Pole-Aitken Basin on Sunday. In doing so, it followed up on a 2019 milestone: predecessor Chang’e 4 had landed in the same region then, making China the first country to successfully land a probe on the far side of earth’s satellite. India’s Chandrayaan-3 landed on the lunar south pole last year.

Technical challenge: Because the far side of the moon faces away from our planet, mission controllers can’t communicate directly with spacecraft in the region. To that end, China launched a moon-orbiting satellite in April. Chang’e 6, which is incidentally carrying a payload from Pakistan, is China’s attempt to be the first country in the world to retrieve samples from the far side, one that could provide unprecedented findings about the moon’s formation 4.5 billion years ago.

The Signal

If sample retrieval and return is successful, Chang’e 6 will bring China closer to its goal of putting a person on the moon before 2030. Also on the anvil are robotic missions to scout for a moon base, for which Beijing has partnered with Russia, among other countries. This plan involves significant infrastructure development that may culminate into an inhabited lunar outpost.

The US’ Nasa-led Artemis mission is targeting a 2026 manned mission to the moon. This has faced repeated delays, as has Nasa’s other projects such as the Boeing crewed flight. The world’s premier space agency, which is grappling with budget issues, would be watching Chang’e 6’s trajectory with a wary eye.

FYI

Drive down dearer lane: Effective today, the National Highways Authority of India is hiking toll charges by 3-5% across nearly 1,100 toll plazas in the country.

Taking credit: Bisleri is mulling a water credits system, akin to carbon credits, to make the beverage industry more accountable for water usage.

Halla bol: Businessperson and investor Halla Tomasdottir has been elected as President of Iceland, becoming the second woman to hold the post after Vigdis Finnbogadottir, who was elected in 1980.

Up, up and away: Nvidia is rolling out the next generation of its AI chip platform, named Rubin, in 2026.

THE DAILY DIGIT

2

Nvidia’s likely spot in the list of world’s most valued companies. The company, currently valued at $2.68 trillion, is projected to overtake Apple, worth $2.92 trillion, “soon”. Microsoft’s market cap exceeded $3 trillion earlier this year. (Reuters)

FWIW

Trump for TikTok: Former Donald Trump has done a U-turn and decided that TikTok is worth his time. The former President and convicted felon, who once deemed the social media platform a national security threat to the US, made a splashy debut on the app on Saturday during a UFC fight. Call it more compulsion than choice. Trump, like current Prez Joe Biden — whose administration is pushing for a potential ban — is angling for youngsters’ votes in the run-up to the US elections in November. The hypocrisy is delicious. What isn’t, is the recent revelation that there’s a lot more pro-Trump than pro-Biden content on TikTok. No wonder The Donald signed up.