Panorama Magazine

Why Panorama?

Illustrating the vision of MD & CEO, Mr. Ramesh C. Bawa, Panorama is an effort to include the people from all walks of life in the IFIN Journey. We chose Panorama as the title because Panorama is a wide view of everything around.

Panorama aptly echoes the diversity of IFIN, not only in its business but its people and culture.

In India, it is estimated that close to 10 million people will get added to the urban areas every year through the next few decades, taking the urban population to about 810 million by 2050. Though the urban population contributes 70% to the nation’s GDP, surprisingly, they occupy only 4% of the total land (Source: India Infrastructure research). The government has already drawn up plans under Pradhan Mantri Awas Yojana (PMAY) scheme to provide affordable housing facility to all by 2022, when the nation celebrates its 75th year of Independence. According to the government’s mission document, the affordable housing is defined as ‘Pucca’ house with water connection, toilet facilities, 24x7 electricity supply and access. If the estimated Rs 25 trillion of investment kicks in by 2022, it will be a huge boost to the economy. It is estimated that the flourishing affordable housing market will give a tailwind of as much as 75 basis points to India’s GDP between 2018 and 2024.

On the cover: Illustration depicting the affordable housing opportunity in India

EDITORIAL TEAM Publisher IL&FS Financial Services

Associate Editor Anju Chopra

Publication Design VelocitaBrand.com

Managing Editor Mona Mohan

Editorial Consultant Vikram Khanna

Printer Parkson Graphics

Co-Managing Editors Lubna Usman Baiju Mathew

Editorial Co-Ordinators Priyanka Chavda Deepika Shetty

All intellectual property rights for material contained in the magazine belong to the publisher unless specifically mentioned otherwise. Opinions expressed in our articles are those of the authors and/or interviewees and do not reflect the opinion of the Publisher or its Editors. Information contained in our articles have been obtained by the Publisher from sources believed to be reliable. However, neither the Publisher nor any of the authors guarantee the accuracy or completeness of any information published herein and neither the Publisher nor the authors shall be responsible for any errors, omissions, or claims for damages, including exemplary damages, arising out of use, inability to use, or with regard to the accuracy or sufficiency of the information contained in the magazine.

The Publisher does not accept responsibility for any investment or other decisions taken by readers on the basis of information provided in the magazine. All objections, differences, claims and proceedings are subject to exclusive jurisdiction of the courts at Mumbai.

For private circulation only.

IFIN Panorama | APRIL - JUNE 2018

01

Message from MD & CEO’s Desk

T

.he last quarter of the Financial Year 2017-2018 i.e. January-March, 2018 has witnessed a number of significant events driven by certain developments at economic, political and regulatory front.

Various measures/initiatives introduced through Union Budget 2018-19 corroborate government’s solemnity for the inclusive growth of the nation adopting a holistic approach for empowering diverse sectors of the society.

On 1st February, 2018, Hon’ble Finance Minister, Mr. Arun Jaitley presented NDA government’s last full year budget ahead of 2019 Lok Sabha elections. The major focus of the Budget was to strengthen and propel the development of sectors viz., agriculture, rural, education, employment, health, MSME and infrastructure, which are considered to be the strong pillars of a powerful nation for its sustainable growth.

Prudent fiscal management has always been an integral part of the Union Budgets.

Continuing its endeavour of efforts towards fiscal reduction and consolidation, the Finance Minister has projected a fiscal deficit of 3.3% of GDP for the year 2018-19 and has also proposed acceptance of the key recommendations of the Fiscal Reform and Budget Management Committee to bring down Central Government’s debt to GDP ratio to 40%.

02 |

The scale of focus towards development of the infrastructure sector signals the magnitude of growth of the economy.

Considering infrastructure development entails huge investment requirement, which is in excess of Rs 50 lakh crore, the Finance Minister announced an increase of budgetary allocation on infrastructure for 2018-19 to Rs 5.97 lakh crore against estimated expenditure of Rs 4.94 lakh crore in 2017-18 with an all-time high allocation to rail and road sectors. Here, I would mention that the private players like IFIN, facilitating the successful implementation of the infrastructure projects through innovating infrastructure financing mechanisms, play a substantial role in the accomplishment of the government’s infrastructure development agenda.

Keeping focus on ‘ease of living’ the Affordable housing occupies a significant place in the Budget and the creation of the Affordable Housing Fund will certainly go a long way in easing the funding gap towards achieving the vision of “Housing for all” by 2022.

Overall, the FY’19 Budget is a well-rounded, pragmatic, inclusive growth-oriented budget assimilating the various sectors - industrial and social, which will undoubtedly give a significant push to India’s higher and sustainable economic growth.

Message from MD & CEO’s Desk

The Indian economy has been one of the fastest growing economies of the World.

The GDP growth got impacted last year on the backdrop of the implementation of structural reforms viz., demonetization and Goods and Services Tax (GST). As the teething problems of these reforms are getting eased out, there is a rebound in the industrial activity and the significant acceleration in the manufacturing and construction has led to the GDP growth at 7.2% in the third quarter as against the estimated growth of 6.9%. This is a clear indication of a turnaround in the country’s economic growth momentum proclaiming back its status of the world’s fastest growing economies.

In the biannual publication of the World Bank, India Development Update, Mr. Junaid Ahmad, World Bank Country Director of India said “India’s long-term growth has become more steady, stable, diversified and resilient.” Ms. Poonam Gupta, Lead Economist with the World Bank and main author of the said report mentioned while presenting the report - “It would be hard to find another country with such a growth promise and its growth is not just steady, but is steadily accelerating.”

The World Bank Report points to macroeconomic stability of the Indian economy and refers to the positive impact of government’s strong determination and various reforms in the Indian economy leading to better governance, and delivery of services and benefits. The rise in GDP growth affirms that with the economic reforms, India’s growth is expected to have a constructive impact on the global growth scenario as well.

During this period, one of the internal important announcements was the execution of a Memorandum of Understanding (MoU) between IFIN and The Jammu & Kashmir Bank Limited (J&K Bank). Under this arrangement, a Joint Venture (JV) is proposed to be conceived between both the Institutions which will undertake the responsibility to support the development, financing and successful implementation of some of the identified hydropower projects in the State of J&K. This JV will work in close association with

The Jammu & Kashmir State Development Power Corporation Limited (JKSDPCL) to put the development of such projects on fast track through EPC or a Public Private Partnership mode. I am sure, this kind of Joint Venture, synergizing the strengths and capabilities of both the Institutions, will be a catalyst for harnessing the hydropower potential of J&K which will lead to huge economic benefits for the State in the form of infrastructure development, industrialization and employment generation.

At IL&FS Group, gender diversity and inclusiveness has been an integral part of its culture. This year, on the occasion of International Women’s Day on 8th March, the celebration was on a different note wherein all the women employees of IL&FS Group came together and took an initiative to help their support staff members by providing them the financial advice, wellness camp facilities etc. This good initiative undertaken by the IL&FS Group in the true sense echoes the culture and ethos being exercised in the Group.

As IFIN has its presence globally, it always endeavours to respect and celebrate cross cultures. Towards this end, on the occasion of Chinese New Year in February, fortunately I had an opportunity to celebrate this event with our Hong Kong office CEO and other team members in Hong Kong.

Last but not the least, the fag-end of the Financial Year brings along enormous pressure to achieve the budgeted numbers.

I am sure, that all our Business Heads along with their team members will not leave any stone unturned for the successful accomplishment of the targets while remain reinvigorated to take on the new challenges and targets for the next year.

Wishing them all the very best for encountering each day as a new challenge and setting new precedents by successfully overcoming them.

Sincerely yours, Ramesh C. Bawa Managing Director & CEO IL&FS Financial Services Ltd. (IFIN) IFIN Panorama | APRIL - JUNE 2018

03

Image of the Quarter

Festive Greetings For Chinese New Year

04 |

Image Courtesy: Dr. Kate Kwan CEO of IL&FS Financial Services, Hong Kong

Editor’s Note Dear Readers, The ‘Affordable Housing’ sector is at an inflexion point and is anticipated to be the next big growth driver of Indian economy.

The sector has witnessed a substantial 27 percent surge in new project launches, with Mumbai taking the lead. This follows after the asset class received the muchawaited infrastructure status from the government. Our cover story encapsulates the significance of this sector in the economy while meeting India’s growing housing needs and providing employment to millions.

The last quarter of the financial year 20172018 witnessed a number of important events on economic, political, and regulatory front. Our MD & CEO, Mr. Ramesh C. Bawa view that the Union Budget was a well-rounded, pragmatic, and inclusive growth-oriented budget assimilating various sectors - industrial and social, which will undoubtedly give a significant push to India’s higher and sustainable economic growth.

Another landmark for India and Hong Kong was the approval of Double Tax Avoidance Agreement (DTAA), in November 2017 which is expected to boost investment opportunities between the two large nations. An article on the same throws light on DTAA and its significance in boosting investment and trade between India and Hong Kong.

SGX in our ‘Special Interview’ segment.

He shares his insights on the role of SGX in the growth of Asian bond market and his plans for the upcoming financial year.

We also have Ms. Priya Shetty, Head, Corporate Advisory, IFIN being featured under ‘New Leadership Interview’.

Dance is no longer a form of entertainment but is highly recommended as an alternative to many fitness regimes. Our sports and wellness section takes you through the journey of Dancercise and how it’s gaining popularity among the fitness lovers. In our people and culture section, we talk about how IFIN is constantly striving towards creating a culture of inclusiveness and empowerment within the organization.

The goat farming project near Khed-Sinnar highway has transformed lives of women in the region immensely, the impact section covers the journey of these women’s economic development and social emancipation. We also have an interesting story of a company that relies on crowd sourcing for floating customer-oriented range of products – Just Herbs, India’s first premium beauty and personal care brand founded by Arush Chopra.

Do share your suggestions and feedback at ifinpanorama@ilfsindia.com

We are honoured to feature, Mr. Muthukrishnan Ramaswami, President,

Mona Mohan Managing Editor

IFIN Panorama | APRIL - JUNE 2018

05

CONTENTS 08 16 20

06 |

Affordable Housing 2022: India’s ‘Pucca’ opportunity!

India - Hong Kong DTAA Special Interview - Mr. Muthukrishnan Ramaswami

24

Events @ IFIN International Women’s Day celebration

26

New Leadership Interview - Ms. Priya Shetty

28 32 36 40 45

Budget Special - Mr. Ramesh C. Bawa Impact - The Goat Women of Sinnar People & Culture Innovation - Back to Basics Sports & Wellness - Let’s Dance

IFIN Panorama | APRIL - JUNE 2018

07

COVER STORY

Affordable Housing 2022: India’s ‘Pucca’ opportunity!

M

ore than half of the World’s population lives in urban areas (UN report quoted in www.pbs. org). UN-Habitat estimate reveals, the world over, around 3 million villagers move to the city every week. India is fast catching up, we already have one-third of our population living in urban areas.

In India, it is estimated that close to 10 million people will get added to the urban areas every year through the next few decades, taking the urban population to

08 |

about 810 million by 2050. Though the urban population contributes 70% to the nation’s GDP, surprisingly, they occupy only 4% of total land (Source: India Infrastructure research). The government has already drawn up plans under Pradhan Mantri Awas Yojana (PMAY) scheme to provide affordable housing facility to all by 2022, when the nation celebrates its 75th year of Independence. According to the government’s mission document, the affordable housing is defined as

Cover Story - Affordable Housing

‘Pucca’ house with water connection, toilet facilities, 24x7 electricity supply and access.

PMAY launched in June 2015, aimed at constructing 2 crore houses for the urban poor by 2022. The government seeks to address the housing requirements through multiple program verticals: - Slum rehabilitation with the participation of private developers using land as a resource - Promotion of Affordable Housing through credit linked subsidy - Affordable Housing in Partnership with Public & Private sectors - Subsidy for beneficiary-led individual house construction Says, Mr. Ajay Pandey, MD & Group CEO, GIFT, “The affordable housing segment is at the tipping point to be the next big growth driver of the Indian economy. The new policy level impetus given by the Government of India and the various schemes for affordable housing

by State Governments, has demonstrated the potential to turnaround the fortunes of the real estate sector in the near to medium term. The resultant tailwinds in the sector can transform the affordable housing to a financially viable proposition for private developers.”

While the plan is in place, India faces a number of challenges in implementing the affordable housing. Availability of land in urban areas is one of the key challenges.

Unlocking the potential of unused or under-used lands held by government bodies and PSUs can come to the rescue.

Financing the land is another major challenge that developers/builders face in delivering affordable housing. The absence of a clear title is also a serious deterrent to participation by financial institutions and real estate developers in new as well as redevelopment projects of real estate.

Taking these challenges into account, the Ministry of Housing and Urban Affairs in 2017 has announced a spate of initiatives to encourage private sector participation. The Pradhan Mantri Awas Yojana (Urban), which were limited to construction on government land, now allowed for affordable houses constructed by developers on private land also. It further announced two new models for private investments in low-cost housing on private lands. One, a central assistance of Rs 2.50 lakh per house as interest subsidy on bank loans under Credit Linked Subsidy Scheme (CLSS). Another, a central assistance of Rs.1.50 lakh per house in case the beneficiary does not take a bank loan.

(Source: http://pib.nic.in/newsite/ PrintRelease.aspx?relid=170988)

IFIN Panorama | APRIL - JUNE 2018

09

Cover Story - Affordable Housing

Criteria for Affordable Housing: Section

Size of the Unit*

Income of Household (p.a.)

Economically Weaker Section

30 sq.m.

Up to Rs 3 lakh

Low Income Group

60 sq.m.

Between Rs 3 and 6 lakh

Middle Income Group (MIG)

90-110 sq.m.

For MIG I – between Rs 6 and 12 lakh For MIG II – between Rs 12 and 18 lakh

*Irrespective of the size, the unit should have basic civic services and infrastructure services like toilet, water, electricity, etc.

Credit Linked Subsidy Scheme (CLSS) CLSS will be provided on home loans taken by eligible urban poor for acquisition, construction of the house. Beneficiaries of Economically Weaker Section (EWS) and Low-Income Group (LIG) seeking housing loans from Banks, Housing Finance Companies and other such institutions would be eligible for an interest subsidy at the rate of 6.5% for a tenure of 15 years

10 |

or during the tenure of loan whichever is lower. The credit linked subsidy will be available only for a loan amount upto Rs 6 lakh and additional loan beyond Rs 6 lakh, if any, will be at non subsidized rate (Source: https://www.sarkariyojna.co.in).

Interest subsidy will be credited upfront to the loan account of beneficiaries through lending institutions, resulting in reduced effective housing loan and Equated Monthly Instalment (EMI).

Cover Story - Affordable Housing

The Government further announced developers can opt for annuity-cum-capital grant-based model, where builders can be given a share of the project cost as upfront payment, or choose cost recovery by builders through rental incomes from houses built on government land.

Encouraged by the government’s initiatives, a slew of developers has lined up a robust expansion and investment plans for affordable housing, despite the prolonged slowdown in real estate.

Not only large realty firms, but also mid-sized ones are betting big on building and selling homes in the Rs 20-60 lakh segment, propelled by demand from homebuyers and encouraging government tax incentives.

(Source: livemint.com 18th June, 2017)

IFIN Panorama | APRIL - JUNE 2018

11

Cover Story - Affordable Housing

Private sector participation The Ministry of Housing and Urban Poverty Alleviation has finalised a public-private partnership policy for affordable housing to encourage private sector participation.

Though private sector has had muted participation in the affordable housing space, thus far, the scenario is all set to change. Confederation of Real Estate Developer’s Association of India (CREDAI), the apex body of private real estate developers had announced its first major private investment into affordable housing.

It has launched 375 affordable housing projects with an investment commitment of Rs 700 billion. These projects will involve the development of over 86 million square feet to build a total of 237,000 housing units across 53 cities in 17 states, including Maharashtra, Gujarat, Karnataka, Rajasthan, NCR, Telangana, Andhra Pradesh and others.

Mr. Pandey further adds, “The interest subvention schemes announced by the Central Government for middle-income group can go a long way in meeting the growing demand from the sector.

IL&FS Township & Urban Assets Ltd has conceptualized a value proposition for middle-income segment in the design and development of affordable homes.

The concept is based on homes with quality construction, lifestyle amenities

12 |

and infrastructure for the middle-income segment which is currently underserved.

We will leverage and harness the proven capability of IL&FS Group entities in the successful development and management of infrastructure projects while meeting the aspirations of middle-income group.”

Financial sector stands to gain The housing finance market, over the years, has reported robust growth despite slowdown in the real estate segment.

Further, the lending rates of the banks and Housing Finance Companies (HFCs) have also declined by up to 2 percentage points further boosting the demand for housing credit. The recent surge in HFCs from 33 to 98 augurs well for inclusive sector growth. With Public Sector banks, having large NPAs, slowly vacating this space, this has opened up opportunities for HFCs in this segment. At the same time, HFCs with their customised offerings around the low-cost housing segment are well poised to tap the opportunity.

FDI in Housing segment In 2005, the government allowed 100% FDI in the construction development sector under the automatic route, which led to a subsequent boom in the sector in later years. The housing sector has received about $24.29 bn till March 2017, which is about 7% of the total FDI flows since April

2000. Going forward, the sector is likely to witness a rise in FDI inflows owing to the increased transparency in the sector with the introduction of Real Estate (Regulation and Development) Act, 2016, Benami Transaction Prohibition (Amendment) Act, 2016, the Real Estate Investment Trusts (Amendment) Regulation, 2016 and other legislations.

Further, Securities and Exchange Board of India-registered foreign venture capital investors have now been permitted to invest in companies engaged in affordable housing without complying with the FDI pricing norms. This comes as a big boost to investors since they may not need to set-up PE/FDI-compliant systems to avail investment opportunities in housing projects.

REITs – a new avenue for fundraising Real Estate Investment Trust (REIT) is a group of income-producing assets backed by tangible security providing regular yield to its investors. REITs have the potential to change the dynamics of the real estate sector in India by providing a platform to the real estate developers and investors with core assets to monetise the same; providing an alternative platform to the investors to invest in the real estate without being exposed to a plethora of issues in the real estate sector in India. Though the concept of REITs is yet to take off in India, several new amendments are being made to the REITs regulation for it to be more attractive.

IFIN Panorama | APRIL - JUNE 2018

13

Challenges to tackle High demand and unsold inventory still coexist in India as a result of price mismatching. Affordable housing units fall out of preference for buyers on account of higher than expected prices.

Mr. Ajay Pandey, MD & Group CEO, GIFT added, “Pricing mismatch primarily stems from the high cost of land in the urban areas and high construction costs.

Further, poor quality construction and homes devoid of amenities essential for a quality life, brings in a mismatch between customer value and price. As mentioned above, we will strive for cost efficiency in our products through efficient construction technology, supply chain management

14 |

and asset management so as to pass on the benefits to the customers. We will also explore opportunities to develop affordable housing in partnership with various government entities, which makes land available at affordable rates a possibility.

On top of that, our concept of quality construction and quality lifestyle homes makes it a “value for money” proposition meeting the aspirations of middleincome group. The interest subvention schemes and GST benefits offered by the government would bring down the landed costs as well.”

Future outlook The affordable housing sector is at an inflection point and is expected to be

Cover Story - Affordable Housing

the next big growth driver of the Indian economy with industry experts predicting a phenomenal growth rate in the medium term. An ICRA report says the affordable housing segment in India is set to grow at a faster pace than the rest of the real estate sector – over 30% in the medium term. The current housing deficit in India stands at 19 million units, which offers a huge opportunity for realty players in the affordable space. Also, the rising income level of the working class is driving the demand for affordable housing, particularly in Tier I and II cities. Affordable housing promises growth, but with thin profit margins, which is why developers were shying away from investing in this space.

But the government is now incentivising the private sector to participate and the response has been encouraging.

Government’s visible action in narrowing down the demand-supply gap is extremely inspiring. In the last two years, the government has made concerted efforts to

iron out the majority of the issues through fiscal stimulus and other incentives to developers. Over the next four years, until 2022, a wide section of people at the bottom of the pyramid are expected to be brought under the housing net, benefitting the economy at large.

The sector with its backward and forward linkages to 250 ancillary industries, has the potential to generate significant employment opportunities and provide a quantum jump to the economy. If the estimated Rs 25 trillion of investment kicks in by 2022, it will be a huge boost to the economy. It is estimated that the flourishing affordable housing market will give a tailwind of as much as 75 basis points (100 basis points equals to one percentage) to India’s GDP between 2018 and 2024 (Source: India Infrastructure Research).

(Source: https://theconversation.com/theworlds-urban-population-is-growing-sohow-can-cities-plan-for-migrants-49931)

IFIN Panorama | APRIL - JUNE 2018

15

FEATURE

India - Hong Kong DTAA:

The Rise of New Investment Opportunities

D

ouble Taxation Avoidance Agreements (DTAAs) help investors domiciled in one country understand their tax liabilities when they make investments in the other. Since a DTAA ensures tax is not charged twice, it immediately improves the tax-adjusted returns for investors.

Hong Kong has always held a place of pride among global financial centres as the leading financial centre of Asia. Hong Kong also acts as the gateway to China, which means a substantial amount of capital heading to China finds its way through its system. Of late, Singapore has risen as a strong alternative Asian financial centre

16 |

with several European investors using Singapore to route their Asia investments.

The Hong Kong Government has vigorously pursued the execution of DTAAs and other bilateral trade agreements with several countries. The execution of the DTAA with India and a Free Trade Agreement with ASEAN nations are steps taken in the same direction.

With their shared British colonial past, India and Hong Kong have long enjoyed strong trading relations. According to the Hong Kong Trade Development Council data, India was its 7th largest trading partner with around $28 billion worth of bilateral

Feature - India - HK DTAA

trade in the 10 months to October 2017.

Last year Hong Kong’s exports to India grew by almost 35%, making it the 3rd biggest export destination for Hong Kong.

However, one may get an impression that the cross border Investment volumes are not commensurate with the depth of the strong business relations. The absence of DTAA between Hong Kong and India previously cited as one of the main reasons contributing to this anomaly.

Back in 2003, Hong Kong and India signed a limited DTAA exclusively to the benefit of shipping companies and airlines.

Since then, businesses and investors have been anxiously waiting for their governments to put a comprehensive DTAA in place. Almost 15 years later, in November 2017, the Press Information Bureau announced that the Indian Cabinet had given its approval to a DTAA with Hong Kong. This has led to palpable excitement in the business community, especially the financial world as the agreement may help achieve the true potential of investment and trade between both nations. Indian projects in growing sectors like infrastructure, transport, and e-commerce will gain access to fresh funds. Hong Kong-based investors and Chinese investors investing through Hong Kong will find lucrative opportunities in India that will help them achieve the twin objectives of portfolio diversification and tax-protected returns.

The Indian Government is working hard to boost India’s image as an investment destination globally and has made concerted attempts to achieve that. Hong Kong has already released the DTAA details wherein the Indian government too will be releasing the same after completing the process. Structural reforms coupled with a positive tax treaty between Hong Kong and India will result in a substantial amount of global capital flowing into India through Hong Kong. Further, the massive opportunity in India’s economy with its rising middle class and its million millennials joining the workforce every month, is something that is exciting consumer goods companies in China.

A simplified tax treaty will see a larger number of such entities enter India through Hong Kong. Because the DTAA will bring clarity on how investments in such projects will play out in the medium to long term, with regard to returns and repatriations, significant inflows are expected. That will come from China and also from Chinese investors, using Hong Kong as their preferred financial hub.

IL&FS is extending its reach to new investors and lenders, who do not have a presence in the country today but would like to explore the India opportunity.

We are increasing our coverage among professional firms in the Greater China

IFIN Panorama | APRIL - JUNE 2018

17

Feature - India - HK DTAA

region to leverage our India connect.

Following this, we will explore crossborder M&As and other corporate finance opportunities that may arise with the formalization of the DTAA. IL&FS has a rich pedigree and deep presence in India’s Infrastructure sector.

We occupy a unique position in the sector after having donned simultaneous hats of a Project Developer/Investor and a Project Lender. This capability gives us unique insights in the entire life cycle of Infrastructure projects in India. Pioneering IL&FS projects include the first privately operated metro project that is Rapid Metro Rail in Gurgaon and the engineering marvels of Chenani-Nashri Tunnelway in Kashmir. IL&FS can provide an enabling platform to anyone keen ongaining an exposure to the Indian Infrastructure space either as a financier or as a developer.

The Indian Infrastructure sector will continue to provide tremendous opportunities for investors across the project lifecycle and satisfy the spectrum of investor appetite. The India opportunity ranges from greenfield projects to operational projects. India’s infrastructure needs are estimated to be a total of US$733 billion between fiscal years 20182022.

Another largely untapped area is India’s stressed assets opportunity. Like any other large and growing economy, India also has its fair share of stressed businesses that provide a great opportunity for specialty funds to acquire fundamentally strong businesses at much lower valuations for turning them around. The recent enactment of the Indian bankruptcy law that is The Insolvency and Bankruptcy Code, 2016 consolidates the existing framework by creating a single law for insolvency and bankruptcy. It is working as a catalyst for the same. IL&FS is partnering with the Hong Kong office of Lone Star, a leading private equity fund manager, to form a fund that will buy stressed assets from the Indian banking system.

Formalization of the DTAA and policy developments in India will provide an impetus to stressed credit. Different pool of capital could open up to explore Indian opportunities. All major financial entities, including asset management and investment firms, pension and private equity funds, have a major presence in Hong Kong. Some, such as SSG, CPPIB, Pacific Alliance, and Blackrock have already made their India plans public. The DTAA will be an additional incentive for more players to explore the Indian stressed asset opportunity.

The emergence of several technology giants in China such as Alibaba and

Feature - India - HK DTAA

India’s Infrastructure Needs in the Next 5 Years Project Time Frame

Estimated Amount (In US$)

Railways

2018-2022

117 billion

Urban Infrastructure

2018-2022

80 billion

Airports and ports

2018-2022

14 billion

Highways

2018-2022

140 billion

Power

2018-2022

205 billion

Infrastructure Component

Source: Crisil Infrastructure Yearbook 2017 (S&P Global) Tencent has been accompanied by investments of risk and/or growth capital into Indian technology firms from entities based out of China and Hong Kong. The equity side of the fund flow is also gaining strength and achieving critical mass.

The biggest advantage will be the rationalization of withholding and dividend distribution taxes levied on loans and investments between India and Hong Kong. This will lead to Hong Kong’s emergence as a leading global financial

centre to route investments in India and facilitate closer interaction with Hong Kong and Chinese firms looking to explore India opportunities. Strong trading ties coupled with a conducive tax regime could also lead to reverse investment flows where more Indian companies may explore Hong Kong as the base to set-up operations in China and North Asia.

IFIN Panorama | APRIL - JUNE 2018

19

SPECIAL INTERVIEW Team Panorama, in conversation with Mr. Muthukrishnan Ramaswami President, Singapore Exchange (SGX)

What were the highlights of your equities business over the past year We saw some positive trends over the past year, with more issuers raising record funds at attractive valuations. For the entire period of 2017, our new bond and equity listings raised funds totalling more than S$500 billion, double the amount raised in 2016.

In the quarter ended December 2017, equity listings raised 10 times more funds 20 |

than in the same period last year (S$1.6 billion vs S$131.1 million) and valuations were attractive in the marketplace.

We focus on six core sector strengths; technology, real estate, consumer, healthcare, maritime and offshore services as well as mineral, oil and gas. As the largest Real Estate Investment Trust (REIT) market in Asia-ex-Japan, we continue to play to our strengths. There is strong interest in REITs and business trusts with international assets. China’s Belt & Road

Special Interview

initiative will fuel further interest, particularly in infrastructure and real estate sectors.

SGX is Asia’s leading bond market – what’s driving this Exciting growth in Asia’s debt market is driven by positive macroeconomic trends, infrastructure financing needs as well as corporate capital expenditure financing needs. SGX is Asia’s leading integrated bond market infrastructure provider, being the preferred venue among issuers to list bonds in Asia, and an enabler of flow in the secondary market through our OTC bond trading platform, SGX Bond Pro. Around 45% of APAC G3 currency bonds are listed on SGX and we have seen about US$850 billion raised through approximately 2,300 debt securities listed by over 800 issuers from 41 countries.

We offer a platform supporting a broad range of debt instruments, including green bonds, where we are witnessing growth and have listed a third of issuances in Asia.

The diversity of our listings, with these coming from a broader range of issuers, products, and geographies, going beyond Asia with issuers from Central and South America, is an encouraging development for our platform.

India is an important issuer location for us and we have listed more than 170 active bonds from more than 90 Indian issuers spanning from government linked to private sector corporations. More than 80% of active G3 currency listed bonds by Indian issuers are listed on SGX. These are all positive signs that issuers continue to be attracted by SGX’s clear regulatory framework, efficient listing process, post-listing requirements, and the access it provides to a diverse and deep pool of capital.

We will continue to help grow and develop the Masala bond market and bring these opportunities to global investors. Looking ahead, we hope to see more activity from Indian bond issuers.

Tell us about SGX being the leading exchange in Asia for overseas bond listings by Indian companies.

Singapore is home to several Indian and other international companies. With many choosing this city-state from which to grow their global footprint, as they are attracted by the regional connectivity, the wealth management hub, and related financial eco-system.

IFIN Panorama | APRIL - JUNE 2018

21

Special Interview

Capital raising is an important part of this and SGX is the leading exchange in Asia for overseas bond listings by Indian companies. Since 2010, there have been 25 INR denominated issues listed on SGX and we have been growing as a leading Masala bond hub with 12 such bonds listed on the exchange.

Raising debt on SGX allows Indian corporates and institutions to diversify their funding base and access the growing investor appetite for Masala bonds. Asia is emerging as a core investor base for Masala bond issuers. Investors in this region accounted for around 70% of some of our listings, including NTPC and Adani Transmission, and we expect this positive trend to continue.

S$2.7 trillion of assets under management in Singapore, as well as access to a global investor base, including retail investors from China, India and South East Asia.

We are the most international exchange in Asia, with nearly 40% of all companies listed coming from overseas. Listing outside of your domestic market in an international venue like Singapore offers the added benefit of increased brand awareness.

While we attract companies from across a wide spectrum of sectors, we have clear strengths in sectors including REITs, with the largest portfolio outside of Japan, and Maritime and Offshore, where we have the largest pool of listed companies among Asian exchanges.

Through our office in Mumbai, we remain active in providing education and information on capital raising in Singapore.

This includes information about the investors that can be reached by issuers and possible ways of fund raising including Masala bonds. All these efforts make SGX the leading exchange in Asia for overseas debt listings from India.

What can SGX offer companies that are looking to raise capital Listing on SGX offers companies access to a deep and diverse pool of international capital within a market oriented regulatory framework and a business friendly environment. We can provide access to Asia’s wealth management hub, enabling companies to tap liquidity provided by 22 |

What are SGX’s plans to attract new technology companies Technology is one of our sector strengths.

Technology and telecommunications is now one of the largest segments of companies listed on SGX with close to 80 companies and a combined market capitalization of

Special Interview

US$62 billion, comparable to our REIT sector, another of SGX’s strong sectors, along with the consumer, healthcare, mineral, oil and gas as well as marine and offshore sectors.

There is a strong investor appetite for tech stocks in Singapore. Our own community of tech listings has much room to grow and we are in continuous talks with tech listing aspirants.

We are in various partnerships with the Singapore Government and private sector to supporting Singapore’s tech and start-up ecosystem. We are also in a partnership with Nasdaq to jointly attract companies to list on both exchanges.

What new innovations SGX is considering such as dual-share listings, How do you expect these to evolve Singapore is making huge efforts to transition into the New Economy. The country is already recognized as a leading hub for start-ups, and some of these companies may need a capital structure that supports a scaling up of the business.

We want to support this as a fundraising

platform and the DCS structure is one way to do this. The rules on DCS are expected to be out by the second quarter of 2018.

What is your outlook for the year ahead The IPO momentum that we’ve seen over the past year is set to continue, driven by improving equity markets and ample liquidity in the market looking for investment opportunities.

We hope to see the results of our efforts to scale up our securities business, such as strategic alliances, and further strengthening Singapore’s position as a vibrant ecosystem for innovation and capital raising.

We will continue to grow our offering to clients in both equities and debt. We are working hard to establish ourselves as the go-to destination for all capital needs, for example through our collaborative listings agreement with Nasdaq that creates an East-West corridor. This will enhance the channels available for companies to access capital market funding and enhance their corporate profile in both markets.

IFIN Panorama | APRIL - JUNE 2018

23

EVENTS @ IFIN

International Women’s Day Celebration At IL&FS Group, gender diversity and inclusiveness has been an integral part of its culture. This year, on the occasion of International Women’s Day on March 8, the celebration was on a different note by organising a three day long activities including financial literacy program, health check-up, self and stress management session and women health and safety. This unique initiative undertaken by the IL&FS Group in the true sense echoes the culture and ethos being exercised in the Group.

24 |

IFIN Panorama | APRIL - JUNE 2018

25

NEW LEADERSHIP

Team Panorama, in conversation with Ms. Priya Shetty

Executive Vice President & Head - Corporate Advisory Services, IL&FS Financial Services Limited (IFIN)

Tell us in brief about your professional journey so far I started my professional journey in 1993 with Lazard India as an equity research analyst. During that period, there was a lot of buzz around equity research with increasing number of FIIs investing in India and hence I decided to take it as a career. After completing four years within the organization as an equity analyst, I was offered a lateral move to Investment banking. The shift was opportune and more of a personal choice and I took it up as I was exploring career alternatives.

During this leg of the journey at Lazard as an investment banker, the building blocks of investment banking namely sector and domain knowledge, relationship building and execution skills were cultivated.

With more than a decade of experience, I moved to Kotak Mahindra in 2005.

The market was beaming with various 26 |

IPOs then and the opportunity to handle this segment added one more product to my portfolio. Over the 11 years devoted in Kotak, I discovered myself as a professional entrepreneur in the true sense and built my expertise in the field of Financial Services, Healthcare and Pharma.

In order to take forward the proficiency, I joined IFIN as Head of Corporate Advisory Services in 2017, with an objective of creating and building a team and the franchise as a relevant and recognised corporate advisor. For me as an investment banker, it is very important to have a sense of entrepreneurship, and IFIN offered that to me. I look forward to an amazing phase of my journey here.

How would you describe your leadership style Investment banking cannot be seen as a job, it is a career for professional

New Leadership

entrepreneurs. Hence, I’ve adopted a participative and inspirational style of leadership. I believe in building a team culture by leading by example, providing avenues for team’s growth, inspiring and igniting team’s passion and lastly but not the least offering recognition of work. If I’ve to inspire my team and command respect, then I’ve to be on top of my game.

How different is a woman’s leadership style In my view, leadership style is not gender driven, I see myself as a professional first whose aim/goal is to motivate and inspire her team towards the vision. To create a successful business, it is critical to mentor and empower the team to develop their potential and contribute effectively.

What advice would you give to people trying to break into Investment Banking Career choice should be driven by passion. This business requires a positive attitude, persistence and patience.

Moreover, this is a people’s business which means networking, ability to build professional relationships, connect with people are critical. There’s no stopping anyone who chooses this profession with a sense of ownership, focus and determination.

Has your career been conventional or capricious I guess quite conventional. For me, the choice has always been between Law and Finance as a career and I happen to choose later. I believe that I have been very fortunate to have offered excellent opportunities at various phases of my career. Things just happened at the right time and all I did is made conscious decision.

How did the M&A segment do in last year and how is it expected to perform in 2018 M&A deals in 2017, largely driven by domestic-domestic and restructuring, reportedly saw a decline both in volume and value over the previous year. The vibrant public markets (2017 witnessed

record fundraising to the tune of USD20 bn) were one of the reasons of the relatively subdued M&A activity in 2017 which made M&A deals expensive. On the other hand, PE investments continued to see an uptrend in activity with transactions in Energon Power Resources, Ola, Paytm, and Flipkart. In 2017, there were high levels of deal activities specifically in the financial services, consumer, infrastructure and TMT (accounted for ~90% of the overall M&A including PE by value).

The M&A and PE deal announcements for the first two months have been encouraging, hence we are bullish on the M&A activity level in 2018. Volatility of the Indian capital markets as evident recently should moderate the expectations conducive for deal making.

Deleveraging balance sheet and Insolvency and Bankruptcy Code would be a key M&A driver for this year. Furthermore, domestic companies would continue to play an active role in domestic M&A both for consolidation and competitiveness.

Private equity continues to be active in buyouts and funding transactions, furthermore, they along with stressed assets funds are working alongside Indian strategics to acquire stressed assets. One could also potentially see strategic exits from non-core business/assets by Indian conglomerates.

What are the key challenges faced by the segment currently Attractiveness of the capital markets is the key factor influencing the M&A and fund raising activity. Furthermore, regulatory changes and external developments would be critical influencers to deal making.

If not an investment banker, what would have been your aspiration I like the networking and creative aspect of this business. Hence, if any, alternative career offers me similar levels of satisfaction and pride, then I could consider it. I’m happy about my career choice.

IFIN Panorama | APRIL - JUNE 2018

27

FEATURE

Budget Special Mr. Ramesh C. Bawa MD & CEO, IFIN

ACCELERATING IMPLEMENTATION OF INFRASTRUCTURE PROJECTS FOR TOMORROW’S INDIA

T

.he Union Budget 2018 presented on 1st February, 2018 by the Finance Minister, Mr. Arun Jaitley has been welcomed as a constructive and reassuring budget reflecting, government’s focused vision for boosting agricultural and rural economy and the infrastructure spending through the public exchequer, 28 |

Feature - Budget Special

while encouraging greater involvement of private sector participants. It was current government’s last full year budget ahead of the general elections to be held in 2019. Various bold reforms undertaken in the diverse sectors through this budget, has disseminated the clear signals that government’s inclusiveness policy will pave a way for the sustainable development of the Indian economy as a whole. This gets substantiated as the government’s focus has not only been on ‘Ease of doing business’ but the announcement to build 10 million houses by 2019 in rural areas under the mission ‘Housing for all by 2022’ has shown government’s focus on ‘Ease of living’ as well.

The government has made an all-time high allocation to infrastructure sector.

The estimated budgetary and extrabudgetary expenditure on infrastructure has been increased to Rs 5.97 lakh crore for fiscal year 2018-19, this will certainly contribute to economic growth, connect and integrate the nation with a network of roads, airports, railways, ports and inland waterways.

ndia’s infrastructure financing requirement has been estimated as approximately Rs 50 lakh crore in the next five years, and given the government’s focus on social sector spendings such as healthcare, rural economy and agriculture, it’s necessary to explore alternative means of financing and attract private investment for funding infrastructure projects. India’s roads, power and urban infrastructure are primarily financed through banks, but due to its high exposure the infrastructure sector faces severe credit constraints. Nevertheless, the union budget has done a great job in recognizing the need for alternative means of infrastructure finance.

The union budget has proposed that the corporate sector should raise at least one-fourth of their funding requirement through bonds, while reducing the regulatory minimum investment grade to ‘A’ from ‘AA’. This would eventually make the corporate bond market more deep, wide, liquid and vibrant in the country.

The market regulator, SEBI is expected to consider a mandate beginning with large corporates to meet about one-fourth of their financing needs from the bond

IFIN Panorama | APRIL - JUNE 2018

29

Feature - Budget Special

- In line with the government’s objective to provide housing for all by 2022, the union budget proposed to set up an affordable housing fund under the National Housing Bank (NHB) boosting supply of rural housing and the augmenting supply of affordable housing in urban areas. The government further said that 3.7 million homes will be built in urban areas in 2018-19, and 5.1 million homes in rural areas.

- The government has proposed over 50 percent increase in allocation for smart cities in the Union budget to Rs 6,169 crore for 2018-2019, while 99 smart cities have been selected with an outlay of Rs 2.04 lakh crore. Nevertheless, an encouraging situation may only emerge when there are more projects executed on ground and cities.

market, while the Reserve Bank of India (RBI) has issued guidelines to nudge corporates access bond market. The bank recapitalization program of Rs 80,000 crore will further pave way for public sector banks to lend additional credit of Rs 5 lakh crore, these initiatives will support the infrastructure sector in a large way, that’s grappling for additional funds.

INFRASTRUCTURE BUILDING FOR TOMORROW’S INDIA - The ambitious Bharatmala Pariyojana with an estimated cost of Rs 5.35 lakh crore has been approved, this will boost the existing road and highways. In another encouraging move the railways’ capital expenditure for the fiscal year 2018–19 has been pegged at Rs 1.48 lakh crore, these initiatives will create job opportunities and facilitate the generation of employment.

30 |

- In a move that will help reduce dependence on diesel pumps to irrigate crops, the budget proposed to offer incentives to farmers to shift to solar power pumps. The surplus electricity generated by the farmers will be bought by state electricity distribution companies (discoms). This will certainly boost India’s emerging green economy.

The government and market regulators have taken necessary measures for development of monetizing vehicles like Infrastructure Investment Trust (InvITs) and Real Estate Investment Trust (REITs) in India. Nevertheless, India will require around $4.5 trillion in the next 25 years for infrastructure development, of which, it will only be able to garner about $3.9 trillion, according to the Economic Survey.

The infrastructure investment gap can only be filled through financing from private investment, institutions dedicated to infrastructure financing like National Infrastructure Investment Bank (NIIB) and also global institutions like Asian Infrastructure Investment Bank (AIIB) and New Development Bank (erstwhile BRICS Bank).

Feature - Budget Special

India to realize its infrastructure dreams, the government must revisit public–private partnership (PPP) models and re-instate confidence into the private sector, which’s lagging at this point of time. The private participation in infrastructure sector is not comforting because of numerous challenges and blockages including land acquisition and environmental issues, moreover, the absence of bankable infrastructure projects has been another disappointment factor for private infrastructure players. The center needs to develop a rational pricing system, a better regulatory mechanism, strengthen dispute resolution mechanisms, and reform financial markets, so that infrastructure projects become economically feasible for the private sector.

The infrastructure sector has always received special attention and an increase in budgetary allocations in every budget, since the government had come to power in 2014. The center has always displayed consistency and coherence on infrastructure policies. It is very heartening that the Prime Minister personally reviews the targets and achievements in infrastructure sectors on a regular basis.

And, by using an online monitoring system of PRAGATI alone, projects worth Rs 9.46 lakh crore have been facilitated and fast tracked. Nevertheless, an enhanced budgetary allocation, institutional mechanism for impartial pricing and competition, and vibrant financial markets is required for achieving India’s long-term growth potential.

IFIN Panorama | APRIL - JUNE 2018

31

IMPACT

The Goat Women of Sinnar A story of economic development and social emancipation

O

nce upon a time, both Sindhu Jadhav and Meera Mengal wanted to hide their goats. Sindhu from her husband and Meera from the leopard that was prowling around. Today, they and their goats are the living symbols of the success of a project led by women and sustained by goats.

Towards the Nashik end of the 138 km long Khed-Sinnar highway built by IL&FS Transportation Networks Limited (ITNL) lie some of the driest regions in Maharashtra.

32 |

The Sinnar and Sangamner talukas barely receive any rain, and thus it was difficult to sustain a living from just agriculture.

So, many people living in the area, mainly women, indulged in goat farming.

As an occupation, goat-rearing is fraught with risks. Even if you managed to protect your flock from the wild animals, there was nothing you could do against disease and death. A dead goat was a dead loss. You had no control over the price the live ones might fetch.

Impact - The Goat Women of Sinnar

Socially, goat farming was looked down upon, especially because women were involved. The men frowned when women dared to take the lead in earning for the family. You are doomed to fail, and we shall not support you, the women were warned. Some persisted, braving the taunts and the threats. Some requested their sisters and friends to keep their goats for them so that the husbands wouldn’t know.

All that changed in 2015.

GOING GREAT WITH GOATS In 2015, the Nalanda Foundation launched the Women’s Livelihood Development Project (now called Sahaj) in association with the local NGO, Yuva Mitra.

Says Sunil Pote, who heads Yuva Mitra, “We had three main objectives when we started the project. Set up a sustainable organization so that the women could work together for their collective growth; train them in scientific goat rearing; and, give them finance and other support to boost their confidence and their capability to make the programme a success.”

The project started out in 5 villages and has proved to be a success.

New sheds provide a hygienic place to grow the goats, where they are also

protected from wild animals. The farmers are careful about choosing the right breed of goats most likely to thrive in the region.

Veterinary services are now easily accessible. Pashu sakhis, women paravets trained to provide most routine medical care, including vaccination, serve as the veterinarian’s eyes and ears in every village. The pashu sakhi initiative is supported by NABARD and the objective is to ensure that a para-vet examines every goat at least once in 15 days.

Not surprisingly, the goat mortality rate has plummeted from about 14% (when the herd size was about 550) to less than 5% (herd size: more than 3500).

With more and more goats insured, when an animal dies, it is no longer a death blow to the poor farmer.

The overall health of the goats has also improved as the farmers have now adopted new technologies for fodder production, processing and preservation.

WOMEN TO THE FORE Right from the beginning, the plan was to make this a project run by women for women. The programme began by educating and motivating the women to form Joint Liability Groups (JLGs) to avail of interest-free loans for purchasing goats, construction of goat sheds, etc.

IFIN Panorama | APRIL - JUNE 2018

33

Impact - The Goat Women of Sinnar

five years ago from my savings. My children needed the milk. After I joined the programme, I took a loan of Rs 5,000 to buy one more goat. Now I have four goats.

I paid off all loans and bought myself a gold chain. My daughters are married.

Both my sons are employed. Now I don’t work for others. I just look after the goats.”

Chaya Karanjkar

According to Manisha Pote, Project Director, “In the beginning it was not easy for us to convince the women that they have to come forward and take charge of the project. We were there to help. They faced serious opposition from their family and the society. But some of them took the bold step. Their example encouraged others to follow.”

With help from the project team and support from NABARD, the women have now formed the Savitribai Phule Goat Farmers Producer Company Ltd. that is regulating all affairs related to goat farming.

Women who once barely stepped out of the house are now chairing meetings, going to the market, training others and negotiating the best deals.

Sunanda shows women how to make fodder

Laxmi Sonawane with her goats

For Chhaya Karanjkar from Datali village, such a small loan brought about a big change. “After my husband died, I continued doing labour work to ensure that my four children completed their studies. I had bought one goat about 34 |

Sunanda Bhabad of Chas village is happy as she has been able to enroll about 50 women in the company. Some of them used to work in her fields before. “Now, they understand the importance of having a proper shed, preparing and storing the right kind of fodder and even making good use of the compost, hygienically.”

Laxmi Sonawane from Dodi village is relieved that she will no longer be taken for a ride by unscrupulous traders. “The traders used to decide the price. We had no idea about the right price. We were often desperate and would sell at any price, however low. Now, we have learnt to weigh the live goat. Based on the weight we have a formula to calculate the minimum price we must get. All goats are sold through our company. The traders cannot cheat us now.”

The women have done so well that the men have now stopped bleating. They are

Impact - The Goat Women of Sinnar

enthusiastically playing a supporting role or engaging in agriculture with renewed vigour, charged by the improved availability of water for irrigation, thanks to the companion water harvesting projects in the area.

With the project yielding satisfactory results thanks to the hard work of the women, the Nalanda Foundation is now looking at marrying scientific goat farming with modern marketing of goat products. Market research shows there is a niche market for goat’s milk and derived products, hygienically-packed meat, export-quality goatskin and valuable compost. Soon, these products will be available on supermarket shelves and online, under the brand name Sahaj.

Nalanda Foundation is also looking to build the ecosystem for the project, such that a larger goat cluster can be created. The project will thus be expanded to a larger number of villages and women.

Already, the project’s success has inspired other foundations to replicate the model in the neighbouring villages. The beneficiaries have those projects have also joined the Savitribai Phule Goat Farmers Producer Company Ltd. The members now number 2000 and are growing.

They say a goat can eat virtually anything.

Pair a determined woman with a goat and, as Sahaj has demonstrated, they shall climb every mountain chewing up every obstacle that dares get in the way.

IFIN Panorama | APRIL - JUNE 2018

35

PEOPLE & CULTURE

Fulfilling responsibilities towards inclusiveness and empowerment

O

ne can clearly see the shift in the range of responsibilities women are taking today; from an all women employees managing a railway station to working in truck manufacturing units to flying fighter jets, women have taken up every challenge to take on the male

36 |

dominated jobs. The corporates are no different and are indulged in measures of creating a balanced yet diverse work force. There are organizations which have imbibed this in their operating philosophy and created dedicated growth avenues to nurture the women employee

People & Culture

cohort. Women employees have been recognized for their efforts to move ahead in their careers, in spite of their life stage needs. Women today have evolved from managing household duties to managing large P&L accounts. At IFIN, there has been a constant effort to promote meritocracy and bring the best person forward for the job.

“It was my goal and vision to make the Women Business Leaders at IL&FS Financial Services (IFIN) the front face of the business and today you will find the Women Business leaders at IFIN are driving the business in a fantastic way”, said Mr. Ramesh C.Bawa, MD & CEO, IL&FS Financial Services.

IFIN has been creating a lot of platforms to empower the women employee cohort by implementing targeted skill building programs. These programs are designed to help women employees overcome their life stage challenges and perform to the best of their abilities. Across all levels of management, dedicated learning interventions help them in understanding the potential psychological barriers to enhance their career. These interventions like experience sharing by Industry experts, lectures on financial stability and mental wellness go a long way in preparing them to take on the responsibilities in an effective way. Online courses from top institutes help in fetching the best capability building opportunity and augment the professional efficacy of women employees.

affinity to leverage resources effectively, this was observed during the IL&FS Women’s day celebration this year, where all the women employees came together to impact the lives of more than 300 under privilege lives. They participated in providing financial advice, wellness advice and above a smile to their faces.

“Ananya” is aninitiative, which revolves around creating a more sustainable and flourishing work environment for the women employees. Under this Initiative a holistic approach is undertaken which includes critical career nudges like, leadership development, self-confidence, achievement orientation, life stage support and realizing one’s true potential. This initiative saw some important infrastructure changes being made in the group e.g. tie-up for on-site daycare. These kind of changes helps the women employees to be free from their responsibilities and focus on their jobs and careers.

IFIN echoes the group philosophy of taking a lot of pride to see a mother play with her child and at the same time bring business laurels to the organization as a functional leader.

There has been a dedicated approach towards ensuring there is enough support, in terms of the policies and facilities, to ensure talented women employees can be empowered to focus on their careers. Once empowered, the women employees have a greater IFIN Panorama | APRIL - JUNE 2018

37

People & Culture

The new mothers experience the understanding and flexibility provided by the organization, through various people policies, which brings their talent forward.

This ecosystem promotes a sense of responsibility in women employees and they work harder to achieve value for the organization and their respective careers.

Being an equal opportunity employer IFIN has always maintained parity in providing the same if not more opportunities to the women employees. Valuing contribution is gender neutral at IFIN. It is at the core of the rewarding superlative contribution. This empowers the women at IFIN to reflect the equal opportunity in their immediate ecosystem. Today, women employees at IFIN enjoy a respectful partnership at the office as well as at home.

IFIN Leadership Mentoring program, the mentoring initiative strengthens

38 |

the philosophy further by providing the impetus to women leaders and helps them to play by their strengths, natural qualities which impact effective leadership. There has beenvigilant yet consistent thrust in their careers and it plays a pivotal role in replicating the IFIN brand name in the financial sector. The systematic approach of allowing women employees to take calculated risks and hand holding them in the critical phase of execution has led the IFIN Leadership team to build a set of dynamic and competitive set of Women leaders at IFIN. A testimony of this empowerment is that at IFIN, women leaders are front ending five critical functions and the teams are flourishing under their leadership.

At the very core, IFIN demonstrates “support at life stage�. It is a matter of pride that more than 90% of women

People & Culture

employees join back after their maternity break albeit some need extended maternity break. Fairness and meritocracy sits at the centre of career advancement and often higher order roles and growth during maternity is key to strengthening anchored performance and potential.

This culture of inclusiveness provides an entrepreneurial spirit to the women employees. Their ideas are given respect and they have been empowered to take these ideas to fruition. This is critical in uplifting the morale of women employees, the feeling that they are an integral part of an organization’s growth builds enormous amount of self-confidence. At IFIN this is a reality, and a testimony to this is the fact in the last 3 years, IFIN’s most cherished award “The Business Leader of the Year” has been bagged twice by Women Business Leaders.

It is important to be cognizant of the changes that are being observed in the needs of the diverse workforce, but what’s more important is to bring meaningful change to suit these needs.

The critical thing is to develop a culture of inclusiveness i.e. respects all the individuals for their uniqueness.

With more than 35% women employees (way above the Industry standards), IFIN has been able to not only create a balanced workforce and has been able to provide the right impetus to its women employees.

Authored by: Sudakshina Bhattacharya Executive Vice President & Head – Human Resources, IL&FS Financial Services (IFIN)

IFIN Panorama | APRIL - JUNE 2018

39

INNOVATION

Back to Basics

B

eauty is being comfortable and confident in your own skin and yet for that beauty to maintain its power, we very often seek aid from the billion dollar personal care industry. Ample research confirms the attractiveness of this segment and how top billing is maintained in the global natural and organic beauty market. Recent findings also show that by 2019 India should emerge as a primary growth market in skin care. For this to be a surety; innovativeness, an ear for every consumer, and a unique Indianness will be the qualities one looks for in a beauty brand. Enter Just Herbs. The first premium beauty and personal care brand in India that relies on crowd sourcing for floating a customer-oriented range of products.

40 |

TREASURE TROVE Fresh herbs really belong anywhere you put them.

- Alex Guarnaschelli Headquartered in Chandigarh, with its foot prints across the world, including the Middle East, UK, and the US, as well as a cult brand in South-East Asian countries like Vietnam and Singapore, Just Herbs is a ‘Made in India’, online-first, international line of pure, bespoke, and Ayurvedic beauty and personal care products made from certified-organic ingredients collected from specified farms across India. “It would be unfair to call the origin of Just

Innovation - Back to Basics

Herbs an epiphanous event; it was rather a very well-thought, well-strategised process of conceptualisation and execution, wherein we knew our strengths with respect to this industry before hand,” explains Arush Chopra, CEO, Just Herbs.

Arush grew up watching his awardwinning bio-chemist mother, Dr. Neena Chopra, constantly come up with new formulations that would address some or the other skin or hair related issues. The efficacy of the products was proven to him whenever he gifted the products to friends or relatives, as he would inevitably receive rave reviews and requests for more.“While I was working in Singapore a few years ago, I witnessed the gigantic boom in the international Ayurvedic beauty industry.

The world had woken up to the danger associated with daily use of synthetic products. However, there was a huge gap in terms of customers’ needs and available products. That’s when I realized what a treasure I had at home, as the products being developed by my mother defied industry norms by being safe as well as highly effective.”

BREAKING THE MOULD A person who sees a problem is a human being; a person who finds a solution is visionary; and the person who goes out and does something about it is an entrepreneur.

The brand currently offers over 65 SKUs of skin, hair, bath, and body products and falls in the affordable luxury category with prices ranging from about INR 500 for a basic product such as a cleanser to about INR 1,800 for a high-performance product such as a facial serum. The entire range carries the utmost natural purity across them and is divided into two categories - proprietary and classical, based on the formulation of every individual product.

“The latter formulations are those that are listed in Ayurvedic texts and are made by several Ayurvedic manufacturers,” points out Arush. “Proprietary formulas are those that we ourselves have developed, using combinations of Ayurvedic ingredients.”

ROOT OF THE MATTER You always draw from your roots.

I’m influenced by everything I hear and see.

– Donny Osmond When synthetic beauty products were mainstreamed in the international market, somewhere in the middle of the 20th century, they were a rage because of their considerably high effectiveness as compared to age-old and almost unmodified Ayurvedic formulations. The

- Naveen Jain Envisioning the formation of a brand around these Ayurvedic remedies, Arush shared his concept with his wife Megha, who immediately recognised the potential of what they had. They moved back to India and decided to float a fresh brand aimed at revolutionising the beauty industry. “We convinced our parents to stop being OEM manufacturers for other brands and in November, 2013, we launched Just Herbs as a path-breaking premium personal care brand; addressing the various skin and hair-related problems of the health and environment conscious urban Indian.”

IFIN Panorama | APRIL - JUNE 2018

41

Innovation - Back to Basics

Ayurvedic beauty industry at those times was scattered, unorganised, and mostly local. In recent times, with the increased outreach of education, the media, and the internet, people have become aware about the kinds of degenerating and corroding side-effects synthetic beauty products have on their body. “This is a universal awakening in terms of giving equal importance to what goes ON the body as what goes IN it. So, it is correct to state that people are unearthing their ancient wisdom with regards to beauty and personal care. They are using products & remedies that do more good to them in longevity,” deems Arush.

“We believe in full ingredient disclosure; we tell our consumers every ingredient that goes into making our products, both on the product label and on our website,” declares Arush. “Our products are pure and safe; none contain sulphates, parabens, GMOs, bleaching agents, alcohol or any other carcinogenic or harsh chemicals. In fact, if there is controversy around an ingredient, we will not use it.

Our in-house manufacturing capacity enables us to troubleshoot controversial ingredients in our products and replace them with more customer-suited safer

42 |

alternatives. The formulations are made 98% by hand, using wild-crafted ingredients, in our manufacturing unit in Mohali. All the products are PETAcertified, 98.2% to 100% natural, with a high concentration of certified organic ingredients.”

CUSTOMER-ORIENTED APPROACH Social innovation thrives on collaboration; on doing things with others, rather than just to them or for them: hence the great interest in new ways of using the web to ‘crowd source’ ideas, or the many experiments involving users in designing services.

- Geoff Mulgan A philosopher once remarked that ideas pull the trigger, but instinct loads the gun.

While looking for an idea on launching fresh products, it was thought that instead of relying on a market research firm, how about reaching out to the public and incorporating their opinion on what exactly they needed. Customers thus participate in the product creation process right from its ideation to its formulation and sale.

“After an initial survey, we found out that our market lacked a makeup product that was safe enough for everyday use,” illuminates Arush. “Our Herb Enriched Skin Tint – a 99.3% makeup and skincare hybrid – is India’s first crowd-sourced beauty product that was the result of a Facebook poll where our vast community of users asked us to come up with something that could

be a natural replacement to an everyday makeup product. Over 450 women of various age groups from across the country partnered with us to create their dream beauty product.”

The reason behind Just Herbs being launched as an online-first brand was that it helped expand their reach very swiftly.

“It assisted us in making rapid strides into the markets in which offline distributors carried dismal outlook for Indian brands,” clarifies Arush. “The online space provided us a neutral platform where people around the globe could reach our product range and benefit from them.” This model has turned out to be hugely advantageous, as within 4 years of its launch, Just Herbs has affirmed its mark around the world and helped pinpoint regions where volumes of trade and demand for products are substantial for initial development of offline retail stores.

MEETING THE CHALLENGE Passion gets an entrepreneur through the start-up days and the enormous efforts it takes to build a business.

- Peter Diamandis While the ‘crowd sourcing’ business model faced almost zero problems with the international audience, it initially had a few narrow setbacks in India. Back in 2014-15, the Indian customer held a very

reserved view towards online commerce, especially for something like a beauty product wherein they’ve been fed infinite free trials by retailers for so long! “But with time, we overcame these hurdles with the trust we have garnered through reviews and positive word-of-mouth feedback,” says Arush. “We posted free tutorials online to ensure that people had a complete idea about what they were about to buy. Now, with the launch of our retail stores and the kind of customer consultation we offer here, this problem is redundant.”

Global challenges included international distributors who don’t often hold a very optimistic outlook of the Indian beauty industry, states Arush. Just Herbs initially had a very hard time making them believe the company’s genuine and honest intent.

But gradually, concerns evaporated, and today Just Herbs sells on some of the strictest platforms (with regard to quality standards) internationally, including being the first Indian brand to be placed on Sephora.com in the South-East Asian markets.

Speaking about other key challenges in setting up Just Herbs, Arush also mentions getting quality raw materials and government support. “A skincare or hair care product is only as good as the results it brings and that directly depends on the potency of the ingredients that go into it.

Sadly, we’ve found that many natural raw material suppliers selling ready-made botanical extracts – some of IFIN Panorama | APRIL - JUNE 2018

43

Innovation - Back to Basics

them controlled by foreign corporations fall short when we tested them ourselves for efficacy and potency. So we’ve started making our own extracts in-house, using plant material, flowers, and plants collected from farms across India.” Just Herbs’s mission is to create a safe and effective beauty brand that customers can implicitly trust.

BREACHING NEW GROUND The entrepreneur always searches for change, responds to it, and exploits it as an opportunity.

- Peter Drucker

Arush feels immensely happy about the fact that the beauty industry is growing at a momentous rate. “It is a sign that people are becoming more and more aware about the disastrous ingredients that they put everyday on their skin. The increasingly health conscious, urban customer-base is proof that we are moving towards a robust lifestyle. We are trying to reach new international markets where an Ayurvedic beauty line can be successful. We also have some new products in the pipeline.

But our next focus, of course, will be on growing our brand in the offline retail

44 |

space.” As of the beginning of March, 2018, their brick and mortar model now extends to one store each in Chandigarh, Ludhiana, and Hyderabad, with plans for more spaces in Bengaluru, Chennai, Delhi, Mumbai, and Kolkata within the next 5 years, with at least 3–4 stores launched annually.

Just Herbs definitely has a delightful and exciting road ahead with continuously improving reviews, a constantly expanding consumer base, and an expected enhanced growth rate with which to begin the new fiscal year. All this, while the Indian beauty industry benefits from a great partnership in truly traditional healing wisdom.

About the Author

Ayesha Dominica A fiercely independent freelance writer, she has been published regularly since age 13, including 6 years at the Express Group. When she isn’t putting pen to paper, she is an artist manager and a curator.

SPORTS WELLNESS

&

Let’s Dance

T

.ired of the treadmill? Worn down by weights? Lethargic after leg day?

Exercise isn’t as exciting anymore as the day you made the resolution to get fit? While the alternatives to getting and staying fit abound, one form has stood a testament to tenacity, longevity, and even fun - Dance! And as an exercise format it has more than its share of takers and keepers.

STAYING FIT No one’s ever achieved financial fitness with a January resolution that’s abandoned by February.

- Suze Orman Everybody has danced at some point in their life and it can be a liberating experience. It’s why dance floors are the sweatiest yet happiest spaces. When

IFIN Panorama | APRIL - JUNE 2018

45

Sports & Wellness

incorporated into one’s fitness regime, it provides a host of benefits not just physically, but mentally as well. It has led to a dancercise culture that clearly makes people stick to their New Year’s resolutions way beyond the normal February resolution dissolution. “Working out in a gym gets monotonous for many people,” points out Petra Fernandes, a trainer currently with E7 Dance Fitness and Pole Star Mumbai. “Dance fitness, no matter how many times you repeat it, offers something different and novel each time.

You use muscles you don’t normally use, and the coolest aspect of the workout is what keeps many coming back for more.

It also works as a distraction from anything you might be going through personally or professionally.”

follows a beat,” explains Neha John, Owner, Elan Dance & Movement, who believes that most people focus on intellectual memory not muscle memory.

“We do not often realise that the human body has a memory of its own. Every muscle, every cell; has its own instinct.

We have never explored this because we never take the time to get to know our own body. Dancing allows us this time.”

With each discovery, we gain an insight that not many gym workouts provide.

Suddenly, it’s not just about losing that flab but getting fit, it’s not about the stress of the day, but letting it all go; and it’s not about the pain, but how much more I can stretch my body today in new ways and push the fitness envelope; thus preventing many injuries and speeding up healing.

Dancercise affords one to spend time with your body in an intimate embrace of the movement. It enables us to work through our emotions as well as the stress of any day. “Your rhythmic movements grant your brain the rest it needs, while your body

STIMULATING MOVEMENT Dance never really goes away; it just reforms and reinvents, and it’s become more athletic with new connections to fitness and sport.

- Bonnie Langford Ever since the lines between dance and exercise have merged, people have begun to realise that you move in different ways than in regular life with dancing.The supply of dance moves available to anyone interested in dancercise is endless. From barre workouts, Pilates, and interval dance training to Zumba, Jazzercise, Hip Hop dance, and more, there is a style to suit every body type, state of mind, and passion. “Dance has the unique quality of being both; aerobic - requiring free oxygen - like running, cycling, etc. and anaerobic - active in the absence of oxygen - which includes movements like sprinting, weightlifting, etc. It is aerobic in nature as it stimulates

46 |

Sports & Wellness

the heart and lungs,” clarifies Venancio, Founder, Ultimate Workouts and The X Training System, among other workout specials. “But on the other side, it can be anaerobic as well if the dance activity is performed at very high intensity. The energy one expends, of course, depends solely on the person dancing. An aerobic dance workout, for example, can burn approximately 400 plus calories in an hour.”

One can be assured of the health benefits and that they equal that of going to a gym and range from the physical to the emotional. It increases one’s fitness level, reduces the risk of heart diseases, diabetes, cancer, etc., elucidates Venancio. “It strengthens one’s joints and bones, helps posture, and tones the body.

It is also a great way to increase litheness because every dance form requires one to stretch before you begin and stretch after you have finished. It is an entertaining

activity, so it keeps everyone motivated, content, and in a good frame of mind.”

EXPERIENCE THE EXERCISE When you dance, your purpose is not to get to a certain place on the floor.

It’s to enjoy each step along the way.

- Wayne Dyer Dance is a creative form. After one learns the basics, the dance floor becomes but a canvas. It is thus not a form of exercise any person gets bored of easily.

Every dance teacher encourages their students to explore their limits, deems Neha. “A teacher can teach you steps and technique, much like a chef can prepare a dish for you. But the experience of the dance or the meal comes from

IFIN Panorama | APRIL - JUNE 2018

47

Sports & Wellness

you! Every routine or phrase you learn in a dance class is bare until you fill it with your personality.” Dance is an innate instinct and once you’ve learnt a specific technique or get familiar with the movement, you can experiment and exercise anywhere. “The focus of these activities is to get the heart rate up and increase circulation, which in turn increases your metabolism and aids in weight loss,” simplifies Neha. “Dance as a form of exercise, is like eating ice-cream for a living - it can’t be work if you love it so much! Hence making it as important a workout for your body as well as your soul.”

APP-INESS ALL AROUND Opportunity dances with those already on the dance floor.

- H. Jackson Brown, Jr. Dance floors have been fitness spaces since time immemorial. With the continuous introduction of technology, it comes as a pleasant surprise that there’s an app that adds to the dancercise experience of a user, while pushing the envelope for the dance fitness space for individuals as well as trainers by taking the dance floor to the living room or one’s own specific playground! Danceright is a first of its kind Bollywood dance fitness mobile application, where users can view and dance to choreographed videos, made to the latest Bollywood tracks. “The app is gamified through your sports bands, tracks your activity while you dance, and rewards you with points,” illustrates Imran Sayed, Director and Choreographer Imran Sayed Entertainment/Danceright. “These points then act as a currency that can be exchanged for discounts that can be used to shop for absolutely anything online.

The more you learn (dance), the more you burn (calories), the more you earn (discounts)! #learnburnearn he enthuses.

“We realized that people want to exercise, 48 |

but don’t seem to find the time, or, on the other hand, get easily bored with doing gym workouts. We wanted to find a way to be able to bring fitness into people’s homes, which gets them off the couch and doing something enjoyable that they look forward to everyday. Dance right aims at just that - a perfect blend between fun & fitness.” Certainly ‘app-ealing’, isn’t it?

SUNSHINE ON YOUR SHOULDER Take care of your body. It’s the only place you have to live.

- Jim Rohn We essentially love the concept of movement. There is no wrong or right way to dance. All we need is ourselves.

Age, sex, or gender no bar. You create your own rhythm and dance your way to a fitter you. Dancercise not only brings out a stronger core, more flexibility, balance and co-ordination, and strength, but also improves memory, allows for a mental escape, while making space for you to tap into your creative side. It allows you to dress up in costume, add colour to your exercise regime, and overall, make training yourself a happier experience.

About the Author

Ayesha Dominica A fiercely independent freelance writer, she has been published regularly since age 13, including 6 years at the Express Group. When she isn’t putting pen to paper, she is an artist manager and a curator.

IL&FS Financial Services Limited The IL&FS Financial Centre, 3rd Floor, Plot C-22, G-Block, Bandra Kurla Complex, Bandra (E), Mumbai 400 051, INDIA +91 22 2659 3560 | +91 22 2653 3149 | www.ilfsifin.com IL&FS Financial Services | IL&FS Financial Services Ltd (IFIN) ifinpanorama@ilfsindia.com |

www.ifinpanorama.com