Markets Poised For Steady Run During Week
Indian markets are continuing to see a bullish undertone ending last week’s last trading session with gains on Friday
On Episode 572 of The Core Report, financial journalist Govindraj Ethiraj talks to Jay Kothari, SVP-Equities at DSP Mutual Fund as well as Rajani Sinha, Chief Economist, CareEdge Group.
SHOW NOTES
(00:00) The Take
(05:38) Markets poised for steady run during week
(14:44) Warren Buffet hands over reins of Berkshire Hathway
(17:36) Oil prices set to fall further as Saudi Arabia joins US in stepping up output
(20:09) Samsung charges income tax department of unfair penalty of $520 million on imports, says Reliance was allowed duty free on same product
(21:30) Maharashtra leads as top performing state
NOTE: This transcript contains the host's monologue and includes interview transcripts by a machine. Human eyes have gone through the script but there might still be errors in some of the text, so please refer to the audio in case you need to clarify any part. If you want to get in touch regarding any feedback, you can drop us a message on [email protected].
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Good morning, it's Monday, the 5th of May and this is Govindraj Ethiraj, headquartered in Broadcasting as well as streaming from Mumbai, India's financial capital.
The Take: Can we catch trends before they happen?
A Minecraft movie was Hollywood's first big hit of 2025 and is an adaptation of a video game about block building surprisingly low on computer graphics, particularly for people of my vintage who like lifelike graphics in games.
A screening of the film I went to in Mumbai went off without mishap but the film has evoked mixed reactions elsewhere including the United States and UK. For one, crowds of teenagers are turning up for the film which grossed $300 million in the first week last month and about $1.4 billion so far. That's good news because teenagers have been avoiding cinema halls as have their parents too all preferring to mostly watch films at home.
The problem as The Economist pointed out last week is the rowdy behaviour. Teenagers have been screaming during screenings, throwing their drinks in the air and jumping on the seats in sync with some on-screen dialogues. Cinema hall owners who would give anything for the crowds to return to halls including in countries like India are surely wondering how to deal with this mixed blessing.
Last week I was speaking with Lenovo India's Managing Director Shailendra Katyal on The Core Report's weekend edition. According to him, tablets which were sandwiched between PCs and mobile phones, Lenovo also owns Motorola by the way, are now seeing a jump in sales. Now this was a category which was somewhat given up on.
The reason is entertainment and presumably mostly people watching video and that too on streaming platforms like Netflix and YouTube. On the other hand, console gaming Katyal says is slowing down and PC gaming is picking up, not something that he expected. Elsewhere, The Economist once again points out that sneakers which were a big thing a few years ago are no longer so.
It says queues outside trainer stores are shorter and less frequent. Styles of trainers or sneakers as they're known outside Britain that once sold for more than quadruple their retail price such as limited edition Air Jordan 1S and chunky Yeezys are being offered at a discount. The Economist adds that online marketplaces in France and the Netherlands apparently went bankrupt recently while Sneaker and Stuff, a European retailer filed for bankruptcy in January citing a global decline in the limited edition sneakers market.
Since 2021, the value of sales of fashion and lifestyle sneakers has dropped by close to 6% in America after adjusting for inflation according to data from a research firm called Sarkana quoted by The Economist. And then perfumes, sales of it are zooming up says another piece in the latest Economist. Fragrance may be the smallest category in the beauty sector but it's growing fast with McKinsey estimating global sales to touch $106 billion by 2028, that's in three years time, an increase from $30 billion from 2023, that's two years ago.
Fragrance's growth is projected to outpace that of makeup, hair care and skin care. Moreover, on an average, boys are spending about $110 annually on fragrance in 2024 which is up from $75 the previous year and compared with about $93 spent by girls, says The Economist. So this is clearly far from the traditional view of who consumes more fragrances.
TikTok has a role to play in many of these trends like in perfumes picking up threads and amplifying it at a speed that few can predict. Take the case of the Dubai Chocolate Bar, its original name is Fix and it became a global viral sensation after being sold only in the United Arab Emirates until three years ago. The founders, a young couple based out of Dubai, were surprised by the attention when it reached them and have struggled to keep up with demand.
And it all started with a TikTok video that went viral. But TikTok or social media may not be the only reason. Some fashion shifts could take place more slowly, influenced by both single events or a combination of external factors, which obviously makes it tougher to engineer at least an intervention in the market particularly if you as a marketer are trying to do that.
It's also tough to explain why youngsters suddenly start turning up in movie halls except to say that game-based motion pictures are obviously better enjoyed in groups with the attraction of creating a ruckus and feeling good about it. But that again in itself is not sufficient insight to bet on. Marketers would love to get early insights on shifts like this either because it helps them expand production or curtail it.
As we've seen it can go both ways but the nature of consumerism is constantly changing and is also unpredictable. The fairly boring perfume industry which had not seen any real action for decades quite likely had no clue that there was a shift coming and that teenagers would suddenly start flocking to them. On the other hand the sneaker industry which was busy expanding had no early insight that people would start losing interest.
Katyal told me that technology companies usually tended to provide consumers with things they did not expect or know about in contrast with let's say consumer products. Steve Jobs' famous quote about wanting to figure out what consumers want before they do rings true here. Essentially, people don't know what they want until you show it to them.
That's the only time you as the enterprise have control over the narrative else you're desperately trying to follow the consumer. Just another thing to think about in an era of tariffs and other uncertainties.
And that brings us to the top stories and themes for the day.
The stock markets are poised for a steady run in the coming week.
Warren Buffett hands over the reins of Berkshire Hathaway.
Maharashtra leads as a top performing state in a new survey.
Oil prices are set to fall further as Saudi Arabia joins the United States in stepping up output.
Samsung charges the income tax department of unfair penalties of $520 million on imports and says reliance was allowed duty-free on the same product.
The Markets Are Holding Up
Indian markets are continuing to see a bullish undertone ending last week's trading session with gains. On Friday Sensex closed up 259 points at 80,501 and the NEC Nifty 50 was up 12 points at 24,346. The Nifty mid cap and the Nifty small cap indices were down though by about 0.8% and about 0.04%. So very marginal on Friday. If you look at the week as a whole, the Sensex was up about 1,289 points and the Nifty was up 307 points and the broader markets also did well though they did not perform as well as the benchmarks. So foreign institutional investors have been net buyers in April around $300 million and were net buyers last week into this month. That's May as well.
The rupee has been appreciating in sync by about 1% or a little more than that to about 84 rupees 47 paise now against the US dollar. So how are capital flows looking and what's the view from outside in? I reached out to Jay Kothari, Senior Vice President Equities and Lead Investment Strategist, Equity Investments and Global Head of International Business at DSP Mutual Fund and I began by asking him how he was tracking the most recent developments and foreign institutional investor flows.
INTERVIEW TRANSCRIPT
Jay Kothari: So as far as the FPIs are concerned, I think if you take a step back before I come to what's changed, I think the last 12-18 months you've seen FPIs being slightly sombre and if I even go back from 2022 onwards, 2022 was negative $17 billion flow from FPIs followed by a $22 billion inflow in 2023 and then it was a flat year last year 2024 and if you remember our previous podcast where I did mention that the flat number was a mix of two worlds where the $20 billion was inflow from active funds both passive and active in terms of the EPFR data and then you have the other direct flows which kind of NSDL kind of captures all our net net it was flat. This year both have been negative which has kind of been a $12 billion so even if you've seen the last couple of weeks of positive flows the number continues to be negative and the negative was for the reason being that you know FPIs were acknowledging the fact that valuations were expensive, your growth was a challenge in terms of you know what we were expecting or pencilling in 7-7.5% GDP growth rate that is that was kind of looking more 6-6.5% kind of handle and then also in terms of the earnings downgrades which we were seeing so all was not very good as far as the macroeconomic backdrop was concerned and hence FPIs were slightly nervous but I think last couple of weeks has changed because of the tariff 4.
Govindraj Ethiraj: I guess the larger trend is that a lot of investors were selling in the US and moving out but that itself I guess is not the main pool of capital that we are attracting. My question really is are there newer pools of capital that we are seeing or is this the old pools which are moving around and shifting around and where could it be headed?
Jay Kothari: No absolutely a great question so I think the way to kind of understand this is that there's definite shift in terms of you know or rather the US exceptionalism is kind of waning as they say and what it means is that more and more money will kind of go out from the US even the domestic US into more cyclical markets so it's not going to be money moving to all markets it's going to be more structural markets whether you talk about India, China or Europe which will kind of find some feet.
Number two is that the entire flow is mainly driven there is no other kind of market which you can expect the money to flow into so from the trade wars I think the recent issue in terms of India Pakistan had it not happened I think India would have been seen a massive inflows and that's because of a couple of reasons. One is the FBI flows have been kind of negative and if you look at the gem funds they are kind of a neutral weight on India. Asia ex-Japan which usually tends to be overweight on India are currently negative 200 basis points and even the global funds are 200 basis points negative on India so net net I think I feel even if they become neutral and I think time has come that you know the worst is over or the flows are still negative but they are kind of increasing at the moment so next few years I will maintain my view that if you see a 15-20 billion dollars flow over the next few years from the FBI which will complement what we've seen even from the India domestic flow 60-65 billion dollars coming in I think that trend is definitely changed.
Now I'll definitely add in the geopolitics as well it's relevant that because it has got a correlation with the flows that if this hadn't happened we would have already seen much more flows than we've seen over the last couple of days because you know when the trade deal or the trade bomb did hit the global markets I think India was one of the only kind of so-called structural markets which could have got money.
Number two is that India is less of an export dependent so we have just 28-20 percent as a percentage of GDP which includes 11 percent of goods export and nine percent of services exports versus the rest of the world which has more or rest of the emerging market which is more leveraged towards export so the beta for the other markets are much more than India.
Govindraj Ethiraj: If we were to look at now how capital could flow and I mean going back to let's say the Wall Street view or the London view how are investors right now evaluating their options I mean this again because there is uncertainty in the US the other markets are good but may not offer as much growth potential so I'm just trying to understand where does India stand at least perceptually right now.
Jay Kothari: No absolutely so again this kind of correlates to what's happening globally and it's always going to be relative it's never absolute so in terms of the relative world in a normal scenario let's just take this that if here Pakistan does kind of go into a full blown war then it's definitely going to be a near-term negative and then till the dust settles and then you see the markets coming back but without that you would have seen the flows but more importantly because of the entire tariff uncertainty globally I think the investors keeping all the other things remaining equal India looks like an absolute kind of a positive market to be in people will tend to overlook valuations and earnings to a certain extent when it comes to just allocations so again don't get me wrong that earnings and valuations are extremely important when you allocate capital across the world but in this case I strongly believe that because there are limited choices you will see that flows and that is also to say that if suddenly Trump comes and says that you know sorry we made a mistake we're kind of pulling back all what we have said so far I think then India could underperform so it's like a very clear message that in this uncertainty India will kind of stand out.
Govindraj Ethiraj: How are you seeing investing in India from the U.S. perspective and also how investors are looking at these markets whether it's U.S. or Europe or Japan and India and what is really playing on their minds right now?
Jay Kothari: No absolutely so that's again an interesting one and it's not as obvious as what it was seemed to be on the face value that when the entire U.S. trade war was with an intention that it would help the U.S. but it may actually start with hurting the U.S. because you know even if it's not the 30 percent well it started off with the 3 to 10 percent expectations that that would be the tariffs and then it went to almost 30-40 percent in some cases 100 percent as you know but even if it kind of settles at around you know let's say 15 percent it will still be inflationary for the U.S. economy and hence there will be some pressure in terms of both the inflation interest rates but also the household income and savings from a U.S. standpoint so therefore what used to be a one-way street for global investors to invest into the U.S. it may not remain that way and hence there could be a reallocation of flows into the other markets and as I mentioned previously whether it's Europe, China and India seem to be the recipients of these reallocation of flows.
Govindraj Ethiraj: You're also seeing I mean the big supply chain shifts and that also influencing the way investors are seeing markets like India.
Jay Kothari: Yeah and just to give you an example of that there is definitely a growing evidence of that happening in terms of the trade diversion and supply chains kind of shifting from China to India, Vietnam to India and just to kind of cite some examples and it was kind of mentioned in one of the sell-side reports where the MNCs are definitely looking at low to mid-tech manufacturing sectors whether it's electronics or whether it's you know examples of Apple trying to shift all its iPhone manufacturing to India so 60 million iPhones will be made in India by 2026. Alphabet or Google is planning to shift its Vietnam operations from Pixel manufacturing to India. Samsung, HP, Asus, Lenovo all are trying to follow suit so this is going to be definitely an important catalyst so what we're talking about China plus one for the last couple of years or even you know the entire focus of current establishment I think this is a very big catalyst so you know because of the trade war unleashing India is probably going to get advantage from that but of course we need to make the entire ease of doing business or whether it's all the other kind of operational efficiencies for global firms to come to India that will remain paramount but net-net this could be a huge catalyst from an India point of view.
Warren Buffett To Step Down
My first introduction to Warren Buffett came via the late stock broker Parag Parikh who often took time off to explain the concepts of value investing and long-term investing and even behavioural finance all very important for young journalists who are starting out like me. Parikh regarded Buffett as a guru and he was not alone. Many older world investors in India, mostly Mumbai that I know of, even today visit Omaha Nebraska for Berkshire Hathaway's annual general meeting, an event that has become bigger and bigger in size and shape as the years have passed.
Buffett's world is of course a far cry from the venture capital driven casino grade investing that we tend to hear and see more of thanks to the media frenzy that surrounds it. Back in Omaha on Saturday Warren Buffett surprised the investing world by saying that he was stepping down as Berkshire Hathaway's chief executive at the end of the year and that he was handing over the reins to his handpicked successor Greg Abel. The 94 year old investor closed the annual meeting of the company he built into one of the nation's largest with a surprise announcement that he will recommend to Berkshire's board that Abel begin the CEO job in 2026 or next year.
The time was where Greg should become the CEO of the company at year end, the Wall Street Journal reported, adding that one of the greatest and longest running shows in American capitalism entered its final months. Buffett transformed Berkshire, once an ailing textile company into a massive conglomerate and a cultural phenomenon attracting as we know devotees since that's the term that best explains it from around the world over. For decades thousands of fans and investors have travelled to Omaha to attend the AGM while millions watch from home and have read through the years his annual letters to shareholders and also studied his wisdom and approach that usually helps shape their own investing approach.
The Wall Street Journal says Buffett's pick for Berkshire's next CEO was not a surprise because he had revealed in 2021 that Abel 62 now would one day succeed him but not even Abel who apparently while sitting nearby on the stage of the Omaha's CHI health centre knew Buffett's thinking on the timing of his succession plan before he revealed it in the closing minutes of the AGM's Q&A session according to the Wall Street Journal. Buffett's stint at Berkshire began in 1965 when he took over that textile company and then he transformed it into an investment vehicle and ultimately a massive conglomerate whose investments range from insurance and energy to railroads footwear and candy and apple.
Buffett said that this or rather that was his 60th annual meeting and it's the biggest and I think the best yet. Parag Parikh, Buffett's devotee, died tragically in a road accident in Omaha in 2015 having gone there to listen to the oracle of Omaha as they called him. Parikh's principles of investing most likely live on in the mutual fund that he started and still bears his name and he must be one of many thousands if not more of Buffett's enduring legacies in the world of investing and finance.
Oil Prices Are Down
Saudi Arabia is doubling down on a radical strategy shift after spending much of the past curtailing output to shore up the market and is now willing to drive down prices as it seeks to punish members who've cheated on their quotas according to Bloomberg. Brent crude prices were holding around $61 a barrel over the weekend and had fallen to a four-year low just below $60 last month following this supply promise. The Organisation of Petroleum Exporting Countries Plus had agreed to surge output again in June as the group's leaders continued an accelerated revival of supply aimed at punishing overproducing members which sent crude prices plunging, said Bloomberg.
Oil producers led by Saudi Arabia and Russia have agreed to add about 411,000 barrels a day next month according to a formal statement on OPEC's website. Crude traders had already been bracing for a large increase after Saudi Arabia signalled in recent weeks that it was willing to accept a prolonged period of low oil prices. Nevertheless, this is a surprising move and yet maybe not because it also syncs with Trump and the U.S. move to increase production and keep prices low. There are newer linkages which may not have been so apparent earlier. An analyst at Reistad Energy who previously worked at the OPEC Secretariat told Bloomberg that OPEC Plus had just thrown a bombshell to the oil market and with this move Saudi Arabia is seeking to punish lack of compliance particularly from Kazakhstan but also ingratiating with President Trump's push for lower oil prices. Saudi Arabia is believed to be seeking to strengthen ties with President Donald Trump who will visit the Middle East this month and has called on OPEC to lower fuel costs.
Even before OPEC began to increase output, oil markets were looking at a surplus in 2025 thanks to slowing Chinese demand and of course extra American supply.
India's Highest Selling Cars
Speaking of oil prices, Hyundai topped the sales chart in March and April with over 17,000 units sold each month for its Creta, climbing from the third place in February and that was the time Maruti Fronks led the pack. Meanwhile, Mahindra Scorpio is now in the top 5 in April with about 15,500 units after being nowhere in the top 10 just two months earlier according to a report in the Business Standard.
Maruti WagonR slipped from the top 5 list after hitting the 2nd and 4th positions in Feb and March. Maruti Swift has also left the top 5. Overall car sales are weak and the last month did not see any significant change.
Samsung Turns The Spotlight On Reliance
Samsung has asked an Indian tribunal to quash a $520 million tax demand for allegedly misclassifying imports of networking gear according to an exclusive report in Reuters. Samsung has argued officials were aware of the practice as India's Reliance imported the same component in a similar manner for years. Samsung is the second large foreign company in recent months to challenge an Indian demand.
Earlier, Volkswagen sued the Income Tax Department and the government for a record demand of $1.4 billion, again for misclassifying component imports. In the Samsung case, tax authorities in Jan asked Samsung to pay $520 million for evading a 10-20% tariff by misclassifying imports of a key mobile tower equipment, which it then sold to Reliance Jio from 2018 to 2021. However, in its challenge, Samsung has criticised Indian authorities for being fully aware of the business model as Reliance had a long-established practice of importing the same equipment without any tariff payments for three years until 2017.
Samsung's India unit says it discovered during an Indian tax investigation that Reliance had been warned about that practice way back in 2017 but did not inform Samsung about it and tax officials never questioned Samsung according to that Reuters report.
Maharashtra Tops The Rankings
Rating agency Carriage Ratings has said that Maharashtra is leading an overall composite ranking followed by Gujarat and Karnataka in a new survey. Maharashtra has topped in financial development and performed strongly across economic, fiscal, and social pillars, Carriage has said. This is the second edition of the Carriage state rankings and is based on an assessment of seven pillars: economic, fiscal, infrastructure, financial development, social, governance, and environment, together capturing 50 indicators.
The report says that Gujarat's performance is supported by its leading economic rank along with favourable outcomes in the fiscal and infrastructure pillars. As per the study, however, western and southern states dominate the top five rankings. Fiscal, economic, and financial development pillars are the strong points for western states while the southern states performed well on economic, financial development, environment, and governance pillars.
Goa topped the rankings in group B which is smaller states that's northeast hilly and small states with a strong score for financial development, infrastructure, social, fiscal, and economic pillars. Union territories have been excluded from this study and I reached out to Rajani Sinha, Chief Economist at Carriage Ratings and I began by asking her what stood out in this study and also to take us through the methodology.
INTERVIEW TRANSCRIPT
Rajani Sinha: It's a pleasure for me. Now coming back to your question on you know about the study that we have done one thing I want to highlight is that when we have done the state ranking what we have tried to capture is all around performance a very holistic approach so here we are not just talking about what's happening to economic growth or how is the government finances faring or how is the infrastructure sector if you see we have looked at seven pillars so we are looking at economic performance, fiscal performance, financial development, social, governance, environment, and infrastructure so the idea is not just to see what's happening in terms of performance currently but how sustainable will be this performance, how inclusive is this performance, and how attractive do these states appear for the investors so we have tried to capture all these aspects and hence you can see we have taken these whole gambit of indicators we have captured some 50 indicators under the seven pillars that I just spoke about so the idea is to give a quantitative approach, quantitative aspect of these states and also a complete holistic picture by covering all the pillars that I spoke about so we had done this exercise two years back also in 2023 we came out with our first issue of state ranking what we have done in this second issue is that we have revised the methodology a little so now the ranking that we have come out with in 2025 is not strictly comparable with 2023 but now the period of normalisation we have increased so going forward when we come out with the next report then we can actually compare the state ranking and then you can see if there's any movement of any state you can see whether the state has actually slipped down or improved we have also added more indicators now coming specifically to governance it's not a completely new thing states are ranked based on some of these governance indicators it's not a new concept but yes it is a very difficult pillar to measure because as you would be aware what kind of data do you get for governance and how exactly do you measure governance it's not a very easy task so what we've tried to do is we have tried to measure governance by looking at ease of doing business by looking at what kind of security do they have how strong is the judiciary system there what kind of service e-service public e-service delivery do they have how strong is their local government so we have tried to capture all these aspects and give a more again like i said even under governance we wanted to give a more wholesome picture by including all these aspects
Govindraj Ethiraj: and when someone looks at these rankings to take an investment decision where do they usually start for example you've talked about financial development rankings which is useful to know if i was assessing states but may not be so relevant for me if i was investing in that state maybe the social ranking matters because i'm looking at jobs employment scalability and so on or for that matter even governance and maybe environment so what's your sense there so
Rajani Sinha: actually all the pillars if you see are kind of interlinked so even as an investor if you're assessing a state what would be most important probably you would say you may look at infrastructure development what's happening on that front but at the same time like you said social indicator is also important because that will give an indication of how sustainable will this growth be going forward for how long will they be able to attain the kind or is the growth going to improve going forward so that is important even you know something like financial development is very important because that gives you a sense of what kind of credit penetration is there in the economy because only then will you get a sense of how easily or how difficult will it be for businesses to get access to credit so that's also an important pillar and does indirectly have an impact on
Govindraj Ethiraj: investors decision right so if i look at your rankings unless i'm missing something so goa is the state that ranks absolutely on the top though it's a small state and maharashtra comes next at 66 and goa is at 62 so what does that really mean to anyone i mean yes it's a prosperous state as it has as we know one of the highest per capita incomes and so on but how does one use that
Rajani Sinha: so i just highlight one aspect that when we compare our states when we do the ranking we compare the large states separately and the small states separately so we have another category which we are calling as group b where we have put the small states and the hilly states and northeast states we put them together because they are not comparable with large states they have some nuances one because of their size second because of their location they are not directly comparable to the large states so i wouldn't compare a goa with a maharashtra goa is ranking
Govindraj Ethiraj: absolutely on the top at 62 in the country so what does that mean in terms of how i could use
Rajani Sinha: that information going forward if i look at the small states our group b if i look at that their goa tops okay because and goa is doing well in all our pillars be it economic fiscal social financial development and they're way ahead of all other smaller states and hence the score is much higher in fact if you look at the state which is like comes in the composite ranking the state which comes second uttarakhand their score is at 48 which is much lower than the score of 62 for goa so goa is actually the score is to give you a sense of how far or how close are these states to each other in terms of performance so goa amongst the group b states of northeast hilly and small states not just goa ranks on the top it's also much ahead of all other states even the second ranker which is uttarakhand but again i will say i will not compare the score of goa with the score of large states so amongst the large states maharashtra is the top
Govindraj Ethiraj: yeah fair enough so how would states use this ranking like how would any states or how would you advise them to use it
Rajani Sinha: so the idea is for the states to assess where are they doing well and where are they not doing well and what is it that they need to learn from the other states like i said various indicators and in fact the interesting thing is that we have ranked the states on each of the pillars so we have not just given the composite ranking where we are saying that maharashtra tops followed by gujarat and karnataka of all the seven pillars be it the economic pillar be it the social fiscal everywhere we have done the ranking for the states so this is where you know other states can see which state is excelling in which pillar and what is it that they are doing that can be learned by the other states just to add to what i was saying to give example if you look at orissa orissa most of you know in our study we saw that it's mainly the western and southern states that are doing well but interestingly if you look at the fiscal pillar it's this eastern state of orissa which is doing exceedingly well and the interesting aspect is that just two decades back orissa was doing pretty badly on fiscal pillar they had very high debt to gdp more than 50 percent and now they have their debt to gdp has fallen to something like 16 percent or so their interest to revenue which was like some 30 percent or so two decades back is at a very low level of three percent or so so all the reforms that they have undertaken in the last two decades i would say that's something which you know the other states can look at and see what difference it has made to this particular pillar for orissa so you've also looked at environmental
Govindraj Ethiraj: ranking and within that you've pointed out for example that Karnataka leads with encouraging scores for air quality and renewable energy and telangana's forest cover and portable water high marshals renewable energy portable water do you have a sense on how whoever consumes this or is a potential consumer which is investors states themselves are seeing this as an important input
Rajani Sinha: so for environment overall if you see we have not given a very higher weightage in our overall ranking we have given the highest weightage to economic and fiscal pillar so together they contribute around 45 percent to our overall index because we feel that these are the pillars which will have the maximum bearing and that they will also impact the other pillars say infrastructure or governance all this will get impacted by these two pillars something like environment right now we have given a weightage of five percent which is which is the lowest as you can see of all the pillars because we feel that this aspect will gather more significance or importance going forward over a longer period of time so though it's not a very significant pillar at this point in time but going forward it will be critical and this is something which all the states should be aware of so in the sense that you know if i look at it in terms of investment attractiveness right now it's not a very important pillar but definitely you know this will say something like access to potable water we know the kind of issue which Karnataka is facing Bangalore is facing so you cannot not look at this pillar seriously maybe it's not very important now but going forward it will become important so that's how the investors should look at it that it kind of gives an indication again of sustainability of growth.
Govindraj Ethiraj: Rajani, thank you so much for joining me.
Rajani Sinha: Thank you.
