TMS Ep317: EV batteries, WhatsApp UPI, Markets, Participatory notes

Electric vehicles will play a major role in India’s emissions reduction goal. But, the heart of an EV, its battery, is mostly imported. For India to become a major EV player, it will have to master battery making. Given the capital intensive nature of the sector, Indian firms will have to grab a share of the global battery demand pie to turn a profit. So, can Indian industry succeed in this ambitious venture? 

Indian EV sector may be off to a good start. But, banks have clearly missed the bus. In RBI deputy governor T Rabi Shankar’s words, they failed to scale-up the UPI in early days, and the opportunity was grabbed by the non-banks. Two of them – PhonePe and Google Pay – now rule the space with about 82% market share. And, it seems, their free run will continue as the 30% market cap mandate will not come into force for another two years. So what does it mean for new players like WhatsApp? 

Moving on, after a sharp rally over the past couple of months, equity markets are in a bit of a consolidation mood. The next triggers for the markets are the RBI’s policy outcome and the results of Gujarat polls. Both of which will be revealed this week. Let's take stock of what all is priced-in by investors, and how different outcomes sway markets.

Staying on with markets, SEBI had introduced participatory notes in the year 2000 so that the foreign investors too have a slice of India's growing stock markets pie. But in 2007, when it thought of regulating it, the markets crashed like ninepins. The regulator shelved the plan, but not the unease. Meanwhile, foreign investment through this instrument continues to swell. So what is a P-note and what are SEBI’s concerns around it? WListen to this podcast to know more.