From General Elections, to RBI's Shaktikanta Das' legacy, to Madhabi Puri Buch's tenure at Sebi: Here are key things to watch out for in 2024

From the big 2024 General Election verdict, to some of the big moves already ongoing in the corporate world, this year is poised to become a landmark one. As we enter the New Year with expectations of a great 2024, here are a few people and trends we should keep our eyes peeled for.

 

 

The Verdict

In the world’s largest democracy, politics and elections are always in the spotlight. But 2024 will see more than half-a-dozen states going to polls as well as the big General Elections, where the incumbent Narendra Modi government will battle to retain its majority. New political alliances may be forged and new promises made to voters. In the first six months of 2024, Odisha, Andhra Pradesh, Arunachal Pradesh and Sikkim will go to the polls, while in the latter half, assembly elections will be held in Maharashtra, Haryana and Jharkhand.

 

Cometh the Hour

Union Finance Minister Nirmala Sitharaman is a person for all seasons. She will present the NDA government’s Interim Budget ahead of the 2024 elections, and the question doing the rounds is: Will she maintain fiscal discipline while making room for poll promises? She has said that it will be a simple Vote on Account. But prepoll Budgets can often be populist and speculation is rife that she will make at least one grand announcement on February 1.

Rate Relief

In the past two years, the US Federal Reserve has hiked its benchmark rate 11 times in an effort to curb inflation. The Reserve Bank of India has followed a similar trajectory. Central bankers around the world are possibly heaving a sigh of relief as inflation shows signs of cooling down. This positive trend has raised the possibility of interest rates softening in 2024. But, history has shown that it might not be so simple. Unforeseen events have upset well-laid plans to control inflation many times since the pandemic started receding. Hence, central bankers need to remain vigilant.

Rest and Relaxation

Travel and tourism firms are raring to jump on to the bandwagon of new travel trends in 2024, particularly event-based travel. “It is emerging as a significant trend, driven by the enthusiasm of India’s millennials, young professionals and GenZers. Their interest in live concerts, events and cultural immersion is poised to be a driving force,” says Rajeev Kale, President and Country Head of Thomas Cook India. With young Indians embracing relaxed vacations, destinations like Goa and Coorg, among others, are expected to gain traction.

Das Capital Control

As Shaktikanta Das, the 25th Governor of the Reserve Bank of India, approaches the end of his second term in the later part of 2024, his tenure will be remembered for stabilising the institution amidst immense challenges. Following the sudden exit of Urjit Patel, Das calmed strained relations with the government. In recent years, he has calmed the waters again after the unprecedented challenges posed by the pandemic. Despite subsequent global challenges, such as the Russia-Ukraine war and the Israel-Hamas conflict, the Indian banking system has remained safe and stable.

Intelligent Debate

The development of vastly improved AI tools over the past year has been unprecedented. But some of its use cases are being seen as harmful around the world. While it is also increasing productivity, policymakers around the world are working to curb its harmful effects through strict regulations. Balancing regulation with the need to spur innovation will be a challenge.

Under the Lens

SME IPOs reached a record high in 2023, with 160 firms raising over Rs 4,000 crore. The year had high subscriptions and listings, which raised eyebrows. Sebi and stock exchanges are closely monitoring the SME IPO segment, and in recent past, bourses have tightened SME listing norms. As Sebi wants to make the segment more attractive to real investors, these measures will be more visible in 2024.

Power Lady

Madhabi Puri Buch has been at the helm of Sebi for nearly two years. She has fully leveraged data and technology for regulatory duties, and 2024 will see her continue on that path. Her agenda: the Indian stock market will no longer follow the developed western markets but will lead in many areas, including transaction and settlement speed. Her term ends in February 2025. In 2024, she would have her last year to fully address the challenges she has highlighted. Watch this space.

Whither the E-Rupee?

The Reserve Bank of India has been working on various pilots for the Cen[1]tral Bank Digital Currency, seen as an official alternative to cryptocurrencies since it is backed and managed by the central bank. It’s been a year since RBI launched separate pilots for wholesale and retail versions of the digital rupee or e-Rupee. It is looking now to expand the pilots. But when will they be rolled out on a larger scale and is 2024 that year? Official sources, however, cau[1]tion that a full-scale introduction may take some more time.

Retail Queen

Isha Ambani, 32, may be don[1]ning many hats at Reliance Industries, but her role as Execu[1]tive Director of Reliance Retail Ventures is most crucial. Within three years, she has doubled the retail venture’s valuation to $100 billion. She has also been aggressively expanding its footprint. Since valuations are at record highs, the company is anticipated to go public in 2024. Her plans to push it to new heights are already in motion.

Going Green

With India’s aviation market expected to grow manifold, the country’s Aviation Minister Jyotiraditya Scindia has launched a host of initiatives, from building new airports and terminals to introducing DigiYatra. As in charge of two carbonemitting sectors—aviation and steel—Scindia is also working on tailored de-carbonisation solutions for the steel industry, and making more airports carbon neutral in 2024.

Comeback Trail

Having begun 2023 in the most forgettable manner, billionaire industrialist Gautam Adani hopes for some respite in 2024. After allegations of fraudulent transactions and stock manipulation rattled investors and wiped off more than $150 billion from the Adani Group companies’ valuation, their stocks have recovered smartly in the past few months. But it’s tough to say whether the worst is over yet.

Pension and Polls

With the general Elections upon us, pension remains a buzzword. Will the government roll back NPS and bring back the Old Pension System, or a hybrid model? While a high-powered panel under Finance Secretary T.V. Somanathan was tasked with reviewing the issue, there’s no word on it. With more assembly elections, apart from the General Elections, up ahead, the issue will keep cropping up.

A Unifying Effort

Already being used extensively in India, efforts are on to take UPI global. But the path is full of challenges, such as navigating intricate international banking regulations, managing risks, addressing tech limitations, enhancing customer awareness, and giving competitive conversion rates, among others. Nevertheless, there are expectations of substantial international collaboration in this space.

Chandra’s Chips

After years of research and expansion into iPhone manufacturing, under the watchful eyes of Tata Sons Chairman N. Chandrasekaran, salt-to-steel conglomerate Tata group is reportedly investing around Rs 40,000 crore in Assam to set up a semiconductor chip ATMP (assembly, testing, marking, and packaging) unit. As the next step, the Tata Sons Chairman is looking to venture into chip manufacturing. Unlike other Indian companies, Tata has group semiconductor firm Tejas Networks and a tie-up with Japanese chipmaker Renesas Electronics to its advantage. Will Chandra’s move spur other players into action?

Shining Bright

The year 2023 was literally a golden year. MCX Gold rose to Rs 62,784 per 10 gm on December 22, 2023, from Rs 54,556 on December 30, 2022. The yellow metal may continue to shine next year, with the US Fed expected to lower interest rates in mid-2024. “On the MCX, gold is expected to trade higher at Rs 57,000-Rs 67,000 per 10 gm in 2024, while on the COMEX (a global commodity exchange), new highs are expected, with a wide trading range of $1,850-$2,250,” says Vandana Bharti, AVP, Commodity Research, SMC Global Securities.

Musk’s Mojo

After buying Twitter (now X) and setting up xAI in 2023, Elon Musk is likely to have an eventful 2024 as well. Following his meeting with PM Narendra Modi during the latter’s state visit to the US in June 2023, talks about Musk’s EV firm Tesla entering India have gathered steam. Starlink, his satellite internet service provider, is also looking to enter India. Overall, it looks like Musk’s India plans are finally taking shape.

The High-Life

Despite macroeconomic uncertainties, Indians with fat wallets bought luxury homes (priced over Rs 40 crore) like never before in 2023. Per Anarock Research, the sales value of such homes rose 247 per cent to `4,063 crore in January-September 2023 from Rs 1,170 crore in 2022, and the number of deals rose to 58 from 13 in 2022. And, realtors predict a 20-25 per cent rise in such deals in 2024.

Debt and Demerger

Even people who knew Anil Agrawal well were surprised by his decision to separate Vedanta Ltd into six entities. While it was driven by high debt and pressure to make big repayments over two years, analysts worry it might cause earnings volatility and worry lenders. However, investors can benefit from investing in multiple firms rather than a holding company. Vedanta has been struggling, and the demerger may help to turn things around.

Cliffhanger

The year 2024 is going to be crucial for Byju’s. A lot depends on the success of what Founder Byju Raveendran (top) and CEO Arjun Mohan have set out to achieve. While Raveendran is focussing on vital corporate tasks, Mohan is spearheading an organisational and business restructuring. Consequently, the company’s survival depends on the outcomes of the combined efforts of these two individuals. Will they be able to turn around the beleaguered edtech firm?

Riding on AI

AI remained a major focus in 2023, and the momentum is expected to continue in 2024. AI start-ups, especially generative AI start-ups like OpenAI, Stability AI, and Anthropic, received over $68.7 billion in funding in 2023, per Pitch[1]Book. Those solving real-world challenges in sectors such as healthcare and finance have attracted VCs. In 2024, generative AI and large language models are expected to become more refined. Therefore, more AI funds are expected to emerge and seize this opportunity.

Electric Dreams

Ola Founder & CEO Bhavish Aggarwal, 38, had a stellar 2023, leading his EV scooter venture to a 30-35 per cent market share. In 2024, he plans to list Ola Electric on the stock market through an IPO that targets raising $662 million at a valuation of $7-8 billion. In addition to its Krutrim AI venture, the company has lofty electric car plans. Currently under construction in Tamil Nadu, the 115-acre mega lithium-ion cell factory is expected to start production in February. Much hinges on 2024 for Aggarwal, as he must justify Ola’s valuation and complete these goals.

A Tough Act

After India’s G20 presidency—that saw the Global South taking centre stage— all eyes are now on how Brazilian President Luiz Inácio Lula da Silva takes it forward in 2024. Lula has out[1]lined Brazil’s agenda, including fighting extreme poverty and hunger, sustainable development, renewable energy, and reform of global governance institutions. What makes his task tougher are the two ongoing wars. How Lula manages to bring G20 members together will be interesting to watch.

Tech to the Rescue

AI-based drug discovery is emerging as a transformative trend in India. Its potential to identify and develop affordable treatments for prevalent diseases like tuberculosis and malaria can significantly impact public health outcomes. AI is empowering local organisations to compete on a global scale by accelerating drug discovery within the country. This approach is not only expected to address affordability issues, but also create highly skilled jobs in the country in the coming years.

Delicately Poised

Y. K. Hamied, Chairman of Cipla, enters 2024 under the spotlight. His company is grappling with uncertainty over a potential sale that has now stalled. While his family wants to reinvest profits into affordable healthcare, potential buyers want market expansion and shareholder returns. As 2024 unfolds, it holds the promise of being pivotal for both Hamied and Cipla.

Passive Aggression

In 2024, passive investments are poised to play a more significant role in the market, with the rise of new-age MF companies like Zerodha Fund House focussing solely on it. Passive investments now account for almost 17 per cent of overall investments, up from a mere 1.4 per cent in 2015. Over half the U.S. market uses passive techniques, reflecting their global appeal.

Red Hot REITs

Markets regulator Sebi and a large section of market participants are promoting Real Estate Investment Trusts (REITs) as a liquid alternative to physical real estate investments. Recently, Sebi even relaxed norms for small- and medium-sized REITs (SM REITs) to popularise REITs. The SM REIT space is expected to grow in 2024 as more players explore the new avenue for attracting retail investments into fractional ownership of properties with a minimum value of Rs 50 crore, a huge drop from the Rs 500 crore limit for normal REITs.

All About the Mind

Breaking free from historical stigmas, mental health is all set to take centre stage in 2024. With rising awareness, even the government is commit[1]ted to the cause: its National Mental Health Mission seeks to address the accessibility and affordability issues around mental well-being. Meanwhile, tech solutions, including tele[1]therapy and mental health apps, are bridging the gap in rural areas. Workplaces, too, are prioritising mental wellbeing by fostering a supportive work environment. Even as challenges persist, it is clear that there is momentum towards prioritising mental health in the country.

Formula for Growth

Indian pharma firms are grappling with maintaining their regulatory compliance and meeting global standards. Stringent requirements in key markets have heightened the need for compliance with good manufacturing practices, strong data integrity monitoring and robust quality control. While compliance is costly, it also offers enhanced brand reputation, broader market access and fosters innovation. Hence, nurturing regulatory excellence

will define the trajectory of Indian pharma firms in 2024 and beyond.

 

Jio Financial’s Key Man

Hitesh Kumar Sethia, MD and CEO of Jio Financial Services (JFS), is the driving force behind the Reliance group’s foray into financial services. The group has big ambitions under his leadership. A seasoned professional who was with ICICI Bank earlier, Sethia brings a global repertoire of experiences to the table. With stints in Europe, Asia and North America, Sethia has played pivotal roles across verticals like credit, retail and corporate banking, among others, which will help him scale JFS.

Preparing for the Battle

Life Insurance Corporation of India has had a rough 2023, having witnessed a drop in its share of monthly new business premiums (NBP) to 58.50 per cent in September 2023 from 68.25 per cent, a year ago. But Chairperson Siddhartha Mohanty is spearheading efforts to bolster LIC’s market presence with new products, including guaranteed return products. With an eye on increasing NBP, Mohanty has launched a nonparticipating product this year, with more in the pipeline. As the insurance giant finds its footing again, investors may need to hold their breath a little longer.

Ready for the Test

Springing a surprise in November 2023, Kotak Mahindra Bank announced the appointment of Ashok Vaswani as its new MD & CEO. With Founder and Director Uday Kotak expected to keep a close watch from within the bank’s board, Vaswani has his task cut out. The challenge for him lies in building a rapport with the senior management while driving the transformative strategy—initiated when Kotak was at the helm—aimed at evolving the private bank into a techsavvy institution with a focus on customer excellence akin to companies like Amazon.

Poor Visibility Ahead

The pandemic is behind us (notwithstanding new outbreaks of Covid-19), but its impact is still being felt on the India’s consumer sector. The inability of those at the bottom of the pyramid to spend is expected to keep manufacturers and marketers on their toes in H1CY24. From manufacturers of entry-level cars and scooters to makers of daily essentials, everyone is rueing the subdued consumer sentiment as volume offtake in the rural market continues to remain in the negative zone. But with the rural economy recovering slowly, there’s hope for H2CY24.

The Next Act

As the curtain falls on 2023, Bollywood would be hoping that the good run continues in the New Year. Thanks to blockbusters like Gadar 2, Pathaan, Jawan, and Animal Bollywood’s total worldwide collections hit Rs 12,729.66 crore in 2023, per Sacnilk, that tracks box office numbers. Insiders are hoping that 2024, too, will see a similar number, riding on much-anticipated movies such as Vasan Bala’s Jigra, starring Alia Bhatt; Fighter, featuring Deepika Padukone and Hrithik Roshan; and Kalki 2898 AD, that has Padukone and Prabhas in lead roles. The stage is all set for Bollywood’s next act. Will the audiences oblige?

Game Changer?

Billionaire Mukesh Ambani’s Reliance Industries is on the cusp of another game-changing move as it looks to acquire Disney’s India business. Although not confirmed yet, the deal is expected to create a powerhouse—with more than 100 channels, two streaming platforms and rights to three major cricket properties across TV and digital platforms. Given these implications, it is likely to pose fierce competition for global OTT giants, spur consolidation among smaller players, and put pressure on rival telecom player Bharti Airtel to intensify its content partnerships.