Chola MS profits surge…
Cholamandalam MS General Insurance company (Chola MS), a joint venture between Murugappa group and Japan’s Mitsui Sumitomo insurance group has recorded a gross written premium of Rs 6200 crore in FY23, marking a 27.6 per cent growth. While the industry average stands at 16.2 per cent, Chola MS has recorded profit before tax of Rs 264 crore. With solvency ratio of over 2.01 times, the company has an investment corpus of Rs 14,715 crore. In the second decade of operations, Chola MS has a market share of 2.87 per cent among multiline players. It holds 5.3 per cent of motor insurance, 4.9 per cent in personal accident. “We expect to grow to 5 per cent market share in another three to four years,” said V Suryanarayanan, MD. IRDA has nominated West Bengal as the focus state for Chola MS. It is planning to work on introducing new products in health to increase its market share.
“Around 94 per cent of claims are settled using this method and it has been hassle-free,” said Suryanarayanan. The company has set a goal of strengthening its digital offerings and is investing in data analytics to understand its’ customers better.
“We are also planning to re-enter crop insurance,” highlighted Suryanarayanan. Chola MS exited the market in 2018-19 but with renewed commitment from the central government on premium reimbursement, it plans to re-enter the Rs 25,000 crore market soon.
A bullet in action
With plans to produce 77 more Vande Bharat trains by 2023-24, the Integral Coach Factory in Chennai is bustling with activity. The semiconductor shortage and the Russia-Ukraine war had derailed the initial plans to produce 75 trains by August 15 2023, but with renewed efforts about 6 trains are produced in a month. The cost to produce a Vande Bharat is about Rs 108 crore without GST. The trains can run at a high speed of 180 km per hour but now run at a speed of 160 km per hour. Track and signalling systems are being modified across the route to attain high speeds.
“We are working on the prototype for Vande sleeper trains and it would be ready by this financial year,” said B.G. Mallya, General Manager. These trains are planned with an aluminium body which would result in weight reduction and help attain speeds of 200 km per hour.
A common problem in highspeed trains is cattle on tracks and stone pelting. When the highspeed train collides with the cattle the fibre reinforced plastic nose designed for aerodynamics purpose gets damaged. In the next design, ICF plans to have a cattle catcher in front of the nose, so that when a cattle crosses, the nose is left undamaged. Yet another strange issue is stone pelting. “I don’t understand why people pelt stone on the train. But I would like to inform that we have two outward facing cameras, that can capture the pelter and in one case, based on this we have arrested a person,” highlighted Mallya.
Soon Vande Metro trains that run for about 100 kms and facilitate inter-city travel is also to be launched. It will act as a modified and luxurious version of the EMU and will run with 8 coaches with a carrying capacity of 300 per coach. It is expected to run from the initial months of 2024.
The ICF campus houses the Chennai Rail Museum that is spread over a 6.25 acre campus. It displays heritage rail items, vintage trains, photos, scale models and also an dedicated art gallery with rail related art works. Public can visit this centre. A 90 seater air conditioned movie theatre is also planned to be rented out soon.
Defence Exports Rise by 23-Times…
Atmanirbhar Bharat has propelled the production of domestic defence products leading to both local consumption and exports. Exports have reached an all-time high of about Rs 16,000 crore in FY 2022-23. This is a 23-fold increase from Rs 686 crore in FY 2013-14. India’s defence industry has increased its capability in both design and development of products and about 100 firms export to 85 countries. Yet another reason for this surge is the conducive policy initiatives and simplified export procedure. The expenditure on defence procurement from foreign sources has reduced from 46 per cent of overall expenditure in 2018-19 to 36.7 per cent in December, 2022.
India’s defence exports consist of aircraft like the Dornier-228, artillery guns, Brahmos Missiles, PINAKA rockets & launchers, radars, simulators, armoured vehicles, etc. The global demand for India’s products, such as the LCA- Tejas, Light Combat Helicopters, Aircraft Carriers, and MRO activities, is also on the rise.
German recession and Indian economy
Germany, the workhorse of the European Union and the fourth largest economy in the world announced that it has entered recession. And this is definitely not good news to the EU and the world. The Gross Domestic Product of the fourth largest economy declined by 0.5 per cent in the fourth quarter of last year and by 0.3 per cent in the first quarter of 2023.
So, what happened to this poster boy of EU? High interest rate coupled with massive inflation curbed people’s purchasing power. Adding on to this was the high cost of energy due to war and it curtailed industrial activity. All this has made Germany the worst performing economy amongst G7. While the recession could not have been avoided, eyes are on to see when and how recovery would happen. Germany is in war-footing mode and has taken several prudence measures. It has provided financial assistance to businesses and consumers and also investing in infrastructure. Only time will answer if these pay off well.
In March, German industrial orders fell by 10.7 per cent from the previous month, marking the largest month-on-month decline since 2020, at the height of the COVID-19 pandemic The German Bundebank expects that the economy will slowly start churning by the second quarter of the year.
India exports were worth $10.2 billion to Germany in 2022-23. With this recession, India’s exports are expected to face an adverse impact to the tune of $2 billion (Rs 16,512 crore) in the smartphones, apparel and other sectors according to the economic think-tank GTRI.
Passing of baton – AM Naik to S N Subrahmanyan
A major change at the helm of L&T was announced recently. S N Subrahmanyan will take charge as Chairman and Managing Director with effect from October 1, 2023 while A M Naik has been conferred the status of Chairman Emeritus. Having served the company for more than 58 years, Naik steered L&T to great heights. During his term, he ensured maximum value creation for shareholders and significant growth in revenue and market capitalisation. “L&T has been my life and I am immensely proud to have played a significant role in its growth. The emphasis on IT and Technology Services has significantly enhanced the organisation’s profitability,” said Naik.
S N Subrahmanyan joined L&T’s construction business as project planning engineer and rose the ranks to CEO and Managing director. He steered the construction business efficiently during the pandemic and has been a part of several major projects like airports, metro projects, freight corridors, across India and globally.
Larsen & Toubro registered 10% growth each year-on-year in PAT stood at ₹3,987 crore in Q4FY23, while revenue stood at ₹58,335 crore in the quarter.
