How can the govt control airfares?

Top of the Morning

Welcome to Top of the Morning by Mint, your weekday newscast that brings you five major stories from the world of business. It's Tuesday, June 18, 2024. My name is Nelson John. Let's get started:

We have no market updates for you today, as the markets were shut on the occasion of Bakri Eid on Monday.

Looking for a new property? You might soon be buying from insurance giant LIC. Anirudh Laskar reports that the Life Insurance Corporation of India is looking to sell some plots and commercial buildings. LIC is India's third-largest landlord, and hopes to net at least 6 billion dollars from these transactions. It has properties in marquee areas such as Delhi's Connaught Place and Kolkata's Chittaranjan Avenue. Since these have been with LIC for decades, a sale valuation of the properties will need to be carried out. Anirudh writes that ascertaining the value of these properties seems to be the biggest hurdle for LIC. Additionally, some of these properties are part of litigations against LIC, complicating the sale process.

Last week, financial services company 360 One announced its acquisition of ET Money, a direct investment platform. Neil Borate writes that it's a puzzling transaction. Just FYI, 360 One was earlier known as IIFL Wealth. But now that ET Money, a mutual fund investment platform, will come under the ownership of a mutual fund, the operations get murky. ET Money might be incentivised to sell the products of its parent company but the markets regulator Sebi prevents such cross-selling or preferential treatment. ET Money also has a paid feature named Genius, an advisory service used by more than 75,000 people. How will this new acquisition play out under Sebi's regulations? ET Money's founders have maintained that no such conflicts will occur, Neil writes.

When the pandemic set in, most industries came to a standstill, and took a while to get back on track. But the logistics sector wasn't one of them. In fact, with everyone stuck at home, more deliveries took place, propelling logistics to another level. Mahindra Logistics, a third-party logistics provider, was a beneficiary of the boom. The company now rakes in an annual revenue of more than Rs 5,000 crore. By FY26, it wants to double that figure. Madhurima Nandy writes that Mahindra's logistics arm is expanding at a dizzying pace to accomplish that. But it has also started a worrying trend: Mahindra Logistics has recorded a net loss for the first time since it listed on the markets in 2017. E-commerce giants like Amazon, Flipkart, and Meesho have beefed up their own logistical arms. How will Mahindra Logistics achieve its targets while maintaining profitability? Madhurima explores the possible answers.

Ever since Jet Airways and Go First shut down, flight ticket prices have skyrocketed. But the new civil aviation minister has vowed to control these prices. Is this even possible? Anu Sharma explains that the Indian aviation market is quite seasonal. Fares aren't established or regulated by the central government. But the aviation regulator has a unit that monitors airfares on certain routes to not charge beyond a certain range of prices. The government already had regulated an upper and lower limit on airfares during covid — Anu writes that it might resort to the same measures if prices get out of control during the current peak summer season, when leisure travel is at its highest.

The genesis of quick commerce in India was rapid: First there was Zepto. Swiggy's Instamart followed suit. Grofers turned into Blinkit after Zomato acquired it. Dunzo was forced to adapt. Others such as Big Basket also sped up their processes. But a couple of years later, we have a new entrant: Flipkart is ready to roll out its quick commerce arm, reports Suneera Tandon. Flipkart's quick commerce venture would be available in select metro cities in the next few weeks. The company will offer home appliances in addition to groceries. Will Flipkart be able to catch up to its established rivals? To find out, you might want to be ready to download yet another app.

We'd love to hear your feedback on this podcast. Let us know by writing to us at [e-mail]. You may send us feedback, tips or anything that you feel we should be covering from your vantage point in the world of business and finance.

Show notes:

LIC mega sale: Insurer to sell land, buildings to raise up to $7 billion

ET Money’s acquisition by 360 ONE: Should you be worried or excited?

After slipping into the red, can Mahindra Logistics execute a U turn?

Mint Explainer: Can airfares be regulated?

Flipkart's q-commerce entry weeks away, will take on Zepto, Blinkit, Instamart