Q1. Electric Vehicles in India, where are we?

What strategies are being adapted by the

existing auto sector industries? What are the external variables which are affecting the
emergence of a clarity on the growth of the EVs as a sectoral play and hence the possible
business strategies which will come into play?
Source:
• https://www.marketsandmarkets.com/Market-Reports/electric-vehicle-market-
209371461.html
• https://www.financialexpress.com/auto/car-news/electric-vehicle-market-in-india-
evolution-challenges-and-solutions/1738148/
• https://auto.economictimes.indiatimes.com/autologue/key-factors-that-will-propel-
growth-in-auto-industry/557
Ans:
1. Electric Vehicles in India, where are we?
According to media reports, currently EV market penetration is only 1% of the total vehicle
sales in India, and of that, 95% of sales are electric two-wheelers. While only 1,500 electric
cars were sold for personal use between April and December 2019, electric two-wheeler sales
under FAME crashed by 94% in the first six months of FY20.
2. What strategies are being adapted by the existing auto sector industries
As automakers sell both conventional and electric vehicles in tandem, it is going to create a
significant impact on the automotive ecosystem.
Automakers:
 Automobile manufacturers are making huge investments in electric car divisions as
they realize that electric vehicles are disrupting the industry
 Significant internal changes will take place as teams fight for their share of budgets in
R&D activities and existing powertrain heavyweights will refuse to step aside
gracefully to electric divisions
 Many new supply chain partnerships are created
 The focus will move to new technologies as the automobile becomes a true computer
on wheels

3. What are the external variables which are affecting the emergence of a clarity on the
growth of the EVs as a sectoral play and hence the possible business strategies which
will come into play?
The real challenges and barriers to going electric
Despite lack of specific pointers towards electrification, the EV Industry in India will still
take another few years to evolve. This does not owe to the Indian Government’s ambitions
targets and their resultant steps but simply because the automobile industry believes that
India too will follow the low-carbon footsteps that are being taken by global big car markets
like China, US and Japan.
 • Price multiple
The biggest hurdle for buyers looking to go electric is the current high price of EVs. For a
buyer who is hesitant to choose a hybrid in favour of the equivalent ICE-only car, the nearly
3x price tag of an EV is too much of an entry barrier. The industry view is that the price
multiple between ICE cars and similarly positioned EV can’t be more than 1.2x to 1.3x.
• Challenges from the Grid side
Most often, the EV discussion only veers around the non-existent charging infrastructure and
about who will be responsible and when will this come up in India. Another point that gets
raised is how much of the power generated comes from old, coal-fired thermal power plants
and about how EVs may well be only displacing the pollution from the cities to the suburbs
where these plants are located.
Key factors that will propel growth in auto industry
Drivers:
• Favorable government policies and subsidies
The governments of various countries have formulated stringent CO2 emission norms that
have increased the demand for electric vehicles. Also, the governments are providing
incentives and subsidies to encourage EV sales.
• Heavy investments from automakers in EVs
Heavy investments from automakers are expected to cater to the growing demand for EVs
and play a major role in the evolution of the electric vehicle market. OEMs offer electric
vehicles in different segments ranging from small hatchbacks such as Nissan Leaf to high-
end sedans like Tesla Model 3. The wide product offering has attracted many consumers and
resulted in a growing market for electric vehicles.
• Growing concerns over environmental pollution
ICE vehicles emit a high volume of GHG into the atmosphere. To curb this, the governments
of several countries have taken initiatives for the deployment of EVs. These initiatives would
help in improving air quality. The use of EVs will reduce the dependence on fossil fuels.
Further, electric vehicles require lesser maintenance and operating costs than ICE vehicles.
• Demand for increased vehicle range per charge
Recent developments have shown a tremendous increase in vehicle range on a single charge.
In addition, electric vehicle manufacturers now offer home charging options with every EV
purchase, adding to the convenience of consumers.
• Major increase in EV models
Expanding e-mobility is an important building block on the road to a CO2-neutral balance.
Government regulations to promote the use of EVs are the driving factor in the increase of
EV models by various companies. The number of EV models introduced by automotive
companies is increasing rapidly with time.
Q2. 2. Covid affected the Indian pharma sector more than other sectors? How the pharma
large, medium and small players leveraging the situation? What is your perspective on the
possible permanent changes in the business from a strategic perspective?
Source:
• https://economictimes.indiatimes.com/markets/stocks/news/coronavirus-impact-on-
indias-pharma-sector/articleshow/75136862.cms?from=mdr
• https://cio.economictimes.indiatimes.com/news/strategy-and-management/covid-19-
will-increase-digitisation-in-pharma-firms-lupin-cio/76417037
• https://health.economictimes.indiatimes.com/news/pharma/pharmaceutical-industry-
expected-to-see-positive-growth-this-year-charu-sehgal-deloitte-india/75639652
Ans:
The impact on the cash flows has led many of the companies in the pharma sector to impose a
freeze on the hiring process. Currently, no layoffs have been considered by companies and
further decisions on increments are yet to be finalised and have been put on hold. However,
unlike the other industries, the pharmaceutical industry is expected to see a positive impact,
on an overall basis, on its growth in this year. The market expectations are on similar lines as
indicated by the stock prices which for many pharma companies had risen by 20-30% in
Apr’20 compared to the Q3FY20 period. The situation will vary with the portfolio and size of
the companies.
Some very small companies may find themselves under stress and could become a source of
the additional capacity that the larger players with deeper pockets are looking at. Some
companies that are seeing increased demand for their portfolio and have also started
incentivizing employees especially in the production function who are supporting plant
operations during this COVID period. However, like all others, pharma companies too are
deploying methods of “trimming the fat”, revisiting capital expenditure, looking at
renegotiating rentals, looking for new sources of incomes from owned assets as well as using
digital mechanisms for meetings and conducting business.
• With a market capitalization of more than Rs 42,000 crore, Lupin is among India’s
largest drug manufacturers. Despite the situation posed by Covid-19, ensuring the
continued functioning of the pharma firm was essential. As companies have
undertaken a huge leap in adopting technology and with digitization becoming a new
normal, the work environment post-COVID-19 will change to a great extent. Aligning
with the current situation, Gopinathan believes pharma companies will see this as an
opportunity to leverage a lot more digital adoption across the commercial supply
chain, covering distribution and order fulfilment.
To improve safety, Gopinathan is also digitizing access control systems through facial
recognition and temperature measurements through thermal scanners etc.
Creating a solution for sales reps
“Virtual meetings might become a permanent scenario and this will certainly accelerate the
digitalisation of services for the pharma industry, across the globe,” maintained Gopinathan.
Q3. There are several positives which are visible as the Covid pandemic's effect on several
businesses such as online payments, insurance, e-commerce, consumption staples, specific
FMCG etc. Identify and explain the effect and possibility of continuing change in revenues
even after Covid restrictions are over.
Source:
• https://www.pwc.in/consulting/financial-services/fintech/dp/impact-of-the-covid-19-
outbreak-on-digital-payments.html
• https://economictimes.indiatimes.com/wealth/personal-finance-news/coronavirus-
impact-on-motor-health-and-life-insurance-pwc-report/articleshow/76418575.cms

Impact on payment categories:

Payment systems have demonstrated that they are dependable and durable, and continue to
command a high level of confidence from the general population. However, closure of
businesses and the lockdown have resulted in lower transaction volumes overall. In this
section, we look at the relative impact of the COVID-19 pandemic on various payment
categories.

Payment Relative impact Remarks

category

Cards Concerns over transmission of the virus

◑ through the exchange of physical
currency will boost online card
transactions.

Wallets Wallets will also see increased traction

◔ for P2P transfers, bill payments and P2M
payments for essential services owing to
Issuance the lockdown and aversion to exchanging
cash. However, some wallet players have
increased their fees for merchants and
consumers, leading to merchants not
accepting their wallets for transactions.

Bank Fund transfers to/from bank accounts will

accounts ◑ likely see an uptick as people substitute
cash with digital transfers.
 ATM Transactions at ATMs will decrease as a
◕ result of the lockdown being enforced.
Not much cash will be required compared
to earlier.

PoS PoS terminals at stores selling essential

◑ items will see an uptick in transactions,
Acquiring while those at most other establishments
will see a decline.

⚫︎
Payment Payment gateways will see an increase in
gateways volumes as transactions go online. They
can also tie up with small stores selling
essentials who are currently seeking to
establish an online presence.

UPI UPI is primarily driven by P2P and P2M

payment transactions. With fears of virus

◕ transmission through cash, P2M UPI

transactions for essential services
(including QR based payments) will see
an increase.

IMPS The IMPS facility will see relatively

Payment ◑ increased activity as fund transfers shift
infrastructure to digital means.

BBPS With no physical avenues to pay bills,

◕ people are adopting BBPS, leading to a
relatively higher number of transactions.

NETC The NETC programme, which facilitates

◕ FASTag toll payments, will be adversely
affected due to restrictions on travelling.

E-commerce
E-commerce is playing a critical role in the fight against COVID-19, with online retailers
experiencing a flood of orders from customers confined to their homes, says GlobalData, a
leading data and analytics company.
GlobalData’s recent report, COVID-19 Impact on E-commerce, reveals that COVID-19 will
have a long-term positive effect on the e-commerce sector, with even the most skeptical
consumers forced to abandon physical stores in response to restrictions on movement.
Luke Gowland, Thematic Analyst at GlobalData, commented: “COVID-19 has given the e-
commerce sector a boost, with online grocery retailers the biggest beneficiaries.
Supermarkets are experiencing unprecedented demand for home grocery delivery.
GlobalData expects the UK online food and grocery market to grow nearly 20 percent in
2020 to £13.2bn.”
However, social distancing measures have dealt a significant blow to clothing and footwear
retailers. GlobalData forecasts a drop in UK online sales of 7.9 percent from 2019 levels.
However, online retailers will still have an opportunity to grab market share from their high
street rivals.
“Companies will be focusing on their supply chains and how technologies such as the cloud,
5G, IoT, and blockchain can help to improve their efficiency and robustness. Ultimately, e-
commerce will benefit from COVID-19 with even the worst effected companies will begin to
build momentum once more once lockdown restrictions have been lifted.”

Q4. Reliance has acquired several businesses of the Future Group in a Rs.24K.Cr+ deal.
Explain the deal and its ramifications on the overall retail sector in India in the coming 3-5
years.
Source
 https://www.ndtv.com/business/reliance-industries-future-group-deal-the-impact-of-
reliances-3-38-billion-deal-with-future-group-2288207#:~:text=The%20acquisition
%20of%20Future%20Group's,extensive%20reach%20across%20the%20country.
 https://www.livemint.com/companies/news/reliance-retail-buys-future-group-s-retail-
other-businesses-for-rs-24-713-cr-11598714386781.html
 https://www.bloombergquint.com/markets/markets-view-on-future-group-reliance-retail-
deal

Ans: Reliance Retail buys Future Group's businesses for ₹24,713 crore
Reliance Retail Ventures Ltd (RRVL), subsidiary of Reliance Industries Ltd acquired the
retail and wholesale business and the logistics and warehousing business from the Future
Group as going concerns on a slump sale basis for lumpsum aggregate consideration of INR
24,713 crore,"
Reliance Retail will now have access to close to 1,800 stores across Future Group's Big
Bazaar, FBB, Easyday, Central, Foodhall formats, which are spread in over 420 cities in
India.
With this deal, Reliance's dominance in the Indian market increases further and the valuation
that Reliance Retail will now command will be even more The acquisition will also help
Reliance to extend its lead over its competitors. Reliance is well known for its ability to win
over customers with financial muscle and its breadth of offerings.
Avenue Supermarts, which runs popular grocery chain DMart, fell as much as 5.4 per cent
while Aditya Birla Fashion and Retail closed 2.6 per cent down and V-Mart Retail lost 4.4
per cent.
JioMart, the new Reliance e-commerce venture that offers free express delivery from
neighbourhood stores, will also gain a leg-up from the Future Group deal thanks to a wider
wholesale supplier base. JioMart delivers groceries, apparel and electronics in more than 200
cities, challenging established online retailers such as Amazon's India unit and Walmart's
Flipkart.
Reliance has essentially removed one competitor from the market and added Future's loyal
customer base to its own portfolio. "It's a very serious challenge not just for Flipkart or
Amazon, but for the likes of DMart, too."
Impact:
 Reliance will have increased bargaining power with the FMCG industry but organised
retail will continue to have a small share in business of FMCG companies, at about
10-15 percent of revenues.
 “Access to Tier 2 and Tier 3 towns where the Future group has inherent presence shall
drive further inroads for the overall franchise footprint in grocery, retail, lifestyle and
other business. Also, over a period the warehousing and supply chain dynamics
should aid in cost synergies and overall digitisation of the Jiomart platform.
Additionally, the opportunities to make a 360 degree presence through digital
mediums, brick and mortar stores, supply chain backward operations should ensure
that they (Reliance Retail) are able to take over the competition from global players.
 The important part with this deal coming in is that they are not only acquiring the
front-end stores but also the backend for retail, which is extraordinarily important
because today when we are going into the grocery business if we have a proper
backend then you have the ability to earn margin out of it.
Q5. Effect of AI, Machine Learning, Deep Learning on the strategic environment of various
sectors, verticals and customer service.
Source:
• https://technology.informa.com/619494/artificial-intelligence-will-be-transformative-
across-industry-domains-and-verticals
•
Ans:
The powerful new technology of artificial intelligence (AI) is here to stay, disruptive in
impact and pervasive in presence, its significant computational capabilities and vast potential
for deep learning applicable to a sea of use cases in daily life and commerce. And together
with 5G connectivity, the internet of things (IoT), and the Cloud, AI will be part of the group
of transformative technologies that are now converging and intersecting in new ways, giving
rise to fresh opportunities and challenges alike.
AI in four industry domains
The AI effect and impact will be most pronounced in the four horizontal industry domains of
semiconductors, HMI, datacenters, and autonomous machines.

Semiconductors:
A major trend in the semiconductor market today is heterogeneous computing, defined as the
use of more than one kind of processor or core, or of dissimilar coprocessors. Deployed not
only in high-performance computing but also in embedded applications that can take
advantage of basic machine learning algorithms, heterogeneous computing is also a solution
that enables AI and ML across applications and industry domains.
As a result, new chip solutions are emerging that contain different cores and accelerators,
with components possessing ML capabilities optimized for high efficiency, lower energy use,
and a reduced build-cost. The existence of varying chip architectures for AI implies that a
uniform one-size-fits-all approach will not be suitable for the AI solutions currently being
developed. Instead, a diverse array of AI-bearing chip solutions will be available to meet the
needs of differing applications.
HMI
HMI, or the human-machine interface, is a basic but extremely powerful application that can
be deployed in multiple applications and across several industries and domains, from
consumer and mobile electronics to automotive, passing through smart homes and smart
appliances or the industrial space. Wherever humans need to interact with machines, an
advanced HMI will be able to add value. Although Siri, Alexa, and Google Assistant have
been developed for consumer electronics applications, the companies responsible for the
assistants—Apple, Amazon, and Google, respectively—are also trying to expand their use
and interface into other domains, including the automotive industry.
The inclusion of AI capabilities in the human-machine interface can bring about several
features and benefits, including added value and differentiation for brands; visibility and
predictability in system performance and maintenance, owing to steady algorithms; and
ubiquity across industries, given the universal applicability of HMI to a wide array of use
cases spanning consumer, enterprise, and industrial concerns.
Autonomous machines and robotics
Machine learning technologies, together with advanced electro-mechanical and sensory
science, are enabling the rapid development and deployment of different autonomous entities
able to accomplish a multiplicity of tasks with varying levels of complexity, traditionally the
domain of humans in the past.
Autonomous machines, based on the categorization carried out by IHS Markit, span a broad
range of devices and equipment in various industry domains. Autonomous machines include
light vehicles, buses, and trucks in the automotive space; harvesting and crop machinery in
agriculture; robots in the industrial and healthcare sectors; toys, drones, and service robots in
consumer; the marine and military industries; and the mining and construction industries.
Machine vision typically includes lighting, a camera or other imager, a processor, software,
and output devices.