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Rupee falls to lowest ever, just 7 paise away from 70 a dollar

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Rupee falls to lowest ever, just 7 paise away from 70 a dollar

The Indian rupee (INR) on Monday, August 13 crashed to a record low against US dollar (USD), tumbling 109 paise to close at 69.93: just 7 paise away from 70 a dollar mark.

On Friday, the rupee had closed at 68.84 against the US dollar.

A report in The Economic Times (ET), quoting Gaurang Somaiya, Currency Analyst, Motilal Oswal Securities, said, “Rupee fell to fresh record low levels after Turkey’s widening diplomatic spat with the US prompted fresh turmoil in the market. Strength in the dollar against its major crosses is also weighing on the Asian currencies including the rupee.”

This year, rupee has been among the weakest currencies amongst the Asian peers, and is down by over 7 per cent on year-to-date basis.

The rupee is expected to fall further, beyond 70 a dollar. Mint reported that in a note forex advisory firm IFA Global said, “The psychological 70 mark is now in sight.”

“We expect that weakness for the currency could extend further. However, losses could be capped around 70.80 levels in the short term,” said ET quoting Somaiya.

The slump came as emerging-market currencies weakened amid concern over the risk of contagion from Turkey’s financial-market turmoil.

Investors rushed to safe-havens such as the US dollar and the yen after a plunge in the Turkish Lira sent all emerging market currencies sharply lower. The Sensex also fell sharply today, ending 224 points lower.

In the wake of weakness across the board, “the RBI may be less keen to intervene. It may do so just to curb volatility and desist speculators,” IFA Global was reported to have said.

Turkey’s lira tumbled nearly 45% so far this year largely over worries about President Tayyip Erdogan on the weekend pushed back on raising rates and showed no signs of backing down in a standoff with the US administration.

On Friday, US President Donald Trump imposed higher tariffs on imports from Turkey, with a 20% duty on aluminum and 50% on steel, as tensions mount between the two NATO allies over Ankara’s imprisonment of an evangelical pastor and other diplomatic issues.

So far this year, the rupee has weakened 8.67%, while foreign investors have sold $200.10 million and $5.20 billion in equity and debt markets, respectively.

Other emerging market currencies have also slumped. Turkey’s lira posted its biggest weekly loss in more than 17 years, Russia’s rouble was among the week’s worst performers, falling to a two year low, Chinese yuan extended losses for a ninth week, Malaysian ringgit dropped for an 8th straight week, Brazil’s Rial had its worst week since November 2016, Mexican peso had its worst week since June, Russia’s Rouble lost more than 6%, South African rand weakened past 14 a dollar to the lowest since November, Argentina’s peso lost 6.7% on the week to close at 29.25 a dollar, just shy of record low 29.45 per dollar.

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Adani, Torrent compete to purchase Gujarat Titans from CVC Capital

The probable sale of the Gujarat Titans, with the lock-in period coming to a close, will therefore be a defining moment in the changing face of IPL investments.

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The Adani Group and Torrent Group are currently negotiating a deal with private equity firm CVC Capital Partners to offload a controlling stake in the Indian Premier League franchise Gujarat Titans. According to sources, close to the development, reports say CVC Capital Partners will be looking to sell a majority interest while retaining a minority share in the franchise.

This becomes important because it is aligned with the end of the lock-in period by the Board of Control for Cricket in India (BCCI), which restricts any new teams from selling stakes until February 2025. The three-year-old franchise Gujarat Titans is reportedly worth $1 billion to $1.5 billion. CVC Capital Partners had paid ₹5,625 crore for the franchise in 2021.

A source close to the development pointed out that IPL franchises have attracted many investors’ interest since the league has proved an asset with a good reputation for money-making capabilities and cash flows. This growing interest of investors embodies the financial value and stability that come with the IPL franchises.

Gautam Adani, who owns teams in the Women’s Premier League and UAE-based International League T20, is understood to be one of the serious buyers. In 2023, Adani’s group won the Ahmedabad franchise in the WPL with a bid of Rs1,289 crore, the highest offer. His interests in this potential deal signal his commitment to expanding his footprint in the cricketing world.

Arvinder Singh, COO of Gujarat Titans, exuded confidence in the financial future of the franchise. He said the team was confident of turning profitable in the next media rights cycle, referring to even the original ten IPL franchises that took four to five years to turn profitable. He added confidently that the Gujarat Titans would not only turn profitable but significantly enhance in brand value.
 
This surging interest of investors in it is evidence of the growing financial attractiveness of IPL franchises, driven by healthy revenue streams and an increasing global footprint. The probable sale of the Gujarat Titans, with the lock-in period coming to a close, will therefore be a defining moment in the changing face of IPL investments.

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PayTm share price slips 2 per cent over SEBI warning

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Paytm

The share price of PayTm fell by nearly 2 per cent on Tuesday following a warning from the the Securities and Exchange Board of India (SEBI).

PayTm’s parent One 97 Communication had got SEBI’s administrative warning letter on some transactions involving the PayTm Payments Bank during fiscal year 2021-2022. The bourses reacted strongly leading to PayTm shares falling by 1.88% to Rs 460.80 per share on the Bombay Stock Exchange.

SEBI said it had noted the violation with concern and said these matters are being viewed very seriously. The regulator warned the company to exercise caution going forward and improve compliance to rules to prevent similar incidents in the future.

The markets regulator added that failure to comply with rules may force it to invoke enforcement actions as per the law.

In its response to SEBI, PayTm said in a media release that it has always followed listing regulations, as well as any change to these rules over time. The company said it would keep up its commitment to maintain and follow high standards of compliance. Paytm said it intends to provide an adequate response to SEBI on this matter.

PayTm said it has always followed Regulation 23 along with Regulation 4(1)(h) of the SEBI Listing Regulations, without including any change made to these rules over time. Paytm added that the letter from  SEBI has no influence on its finances, operations or other activities in any way.

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Zomato, Swiggy hike platform fee by 6% 

After the hike, the platform fee would be Rs 6 per order from an earlier Rs 5 per order.

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The food delivery majors, Zomato and Swiggy, have recently increased their platform fee by 6 per cent for food orders initially in Delhi and Bengaluru.

The food giant is currently charging in the national capital and IT hub, Bengaluru, the platform fee is distinct from delivery fee, goods and services GST, handling charge and restaurant charges.

After the hike, the platform fee would be Rs 6 per order from an earlier Rs 5 per order. Gradually, the higher platform fee is expected to roll out to other cities as well.

Notably, this fee is applicable universally to all food orders, irrespective of customer enrollment in loyalty programmes offered by both food giants. The charges directly contribute to the companies’ revenue streams and cost management efforts. The platform fee goes to the food aggregators to apparently control costs and increase revenues.

In April, they charged Rs 5 per order, but now it’s been increased by Rs 6 per order. That’s a 20% increase in fees for food delivery. This change in their strategy to adjust the price in a market as they expand their services.

Increase in platform fees, impacting how much customers pay for their food deliveries across the board. When customers order food using the app, they will notice different charges, besides the platform fees. These include delivery fees, handling fees, GST (Goods and Services Tax), and charges from the restaurant.

The charges earned by the platform, directly go to the food delivery app, helping to manage all expenses and boost their wages. The food delivery platform aimed to make between Rs 1.25 to Rs 1.5 crore per day through the fee, the app charges.

In August last year, Zomato introduced platform fees of Rs 2 per order for the first time. In October, they raised their platform fees from Rs 2 to Rs 3 in most and in major cities. Additionally,  Zomato is a quick commerce platform.

According to reports, Zomato stock reached its highest price of Rs 232 on the Bombay Stock Exchange. This achievement has made Zomato founder and CEO, Deepinder Goyal, a billionaire. The company has experienced a strong upward trend over the past years, driven largely by the expansion and success of its quick commerce subsidiary in Blinkit.

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