Economy
Data recap: MSP hike, LIC property sale, IPO boom
Summary
- News and developments from the week gone by, through numbers and charts.
Every Friday, Plain Facts publishes a compilation of data-based insights, complete with easy-to-read charts, to help you delve deeper into the stories reported by Mint in the week gone by. The government has announced hikes in minimum support prices of kharif crops, while the Life Insurance Corporation of India (LIC) plans to raise money from the sale of its plots and commercial buildings. As many as 55 companies are expected to go public in the coming months.
Incentivising farmers
After a challenging year for the agriculture industry due to below-normal monsoon and climate change last year, the newly formed Cabinet has announced hikes in minimum support prices of 14 kharif crops for the current year. Among the major crops, MSP for arhar was increased by 7.9% to ₹7,550, followed by urad and maize. However, the increases in paddy, bajra, and moong were less than those of last year. The expected margin to farmers over their cost of production are estimated to be highest in case of bajra (77%) followed by tur (59%), maize (54%) and urad (52%).
Defence exports
The government recently pledged to more than double India's annual military exports to ₹50,000 crore by 2028-29. In the last few years, military exports have consistently experienced a 20-30% annual growth due to rising defence budgets and focus on indigenisation, according to a Mint analysis. This development also bodes well for companies operating in this space. The private sector has played a significant role in this growth, contributing a substantial share. In FY24, private sector’s share stood at 62% in the country’s total defence exports of ₹21,083 crore.
LIC asset sale
$7 billion: Life Insurance Corporation of India (LIC) is planning to garner up to $7 billion from the sale of its plots and commercial buildings, Mint reported. LIC’s real estate assets include premium properties such as Jeevan Bharti building in Delhi’s Connaught Place, LIC building in Chittaranjan Avenue in Kolkata, among others. LIC, India's third-largest landlord, has tasked an internal team to work out a sale plan for its real estate assets across the country. Conservative estimates put LIC’s real estate assets worth ₹50,000-60,000 crore, as per the report.
IPO boom
Despite the volatility in the market, as many as 55 companies are expected to raise over ₹68,000 crore through initial public offering (IPO) over the next few months, a Mint analysis of data from primedatabase.com showed. These include some big-ticket start-ups such as Swiggy and Ola Electric Mobility. So far this fiscal year, seven issues have mopped up ₹19,455 crore, while another five are set to hit the markets in June.
Unequal benefits
India’s growth story is not free of inequality and it was reflected in the recently released consumption expenditure data for 2022-23. As opposed to per-capita per month spending of ₹16,612 by the top 10% Indians in urban areas, the average spending was just ₹6,459, a Mint analysis showed. While welfare programmes such as free food, laptop, school uniforms, among others, helped bring inequality down, the benefit was availed less by scheduled tribes despite their consumption expenditure being low.
Musk’s payday
$56 billion: That’s the amount Tesla shareholders has approved as Elon Musk’s pay package, despite opposition from some institutional shareholders and activist investors. The pay package consisting of stock options was given the nod despite it being invalidated earlier by a court in Delaware where Tesla was incorporated. The hefty pay has come amid plans of job cuts in the company due to slow demand for electric vehicles and tough competition from Chinese rivals, raising questions over the decision.
Tax kitty
The Central government’s direct tax kitty remains robust in the current financial year, with the net direct tax collections being ₹4.6 trillion until 17 June, according to the provisional data shared by Central Board of Direct Taxes (CBDT). The full data will be released at the end of July. The trend for net direct collections in the first quarter in past the few years has been mixed, with the mop-up being 0.1% lower in FY24 and 35% higher in FY23. The provisional data suggests a healthy growth this year in the first quarter.
Chart of the week: Power peaks
Heatwaves and soaring temperatures in 2024 are breaking all records. This is also visible in the power usage data as electricity demand has soared. Historically, June typically sees peak power demand during the summer season. This year, peak power demand had already touched at least a five-year high by early June, with the rest of the month to follow, a Mint analysis showed.
Follow our data stories on the“In Charts" and“Plain Facts" pages on the Mint website.
