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INSIDE THE ISSUE

Takeaways from a call with an HUL distributor – central region

Detailed story on pg. 2

RETROSPECTIVE PERSPECTIVE

Key trends of the last few weeks….

PRIVATE VACCINE IMPORTS: The scramble begins

The rise and fall of Serum Institute of India

A scan on current vaccines

Will lifting vaccine IPs lead to faster rollouts?

Other short takes

Light at the end of the tunnel for the first world

Central Vista project comes under heavy criticism

News round-up of the month

Detailed story on pg. 3-7

Pan-India channel checks to gauge cigarette demand trends in the wake of the second covid wave Detailed story on pg. 2

Road Less Travelled

18 May 2021 | Vol-3, Issue - 5 MONTHLY PUBLICATION

18 May 2021 | Vol-3, Issue-5 | Page - 2 Road Less Travelled | MONTHLY NEWSLETTER

Takeaways from a call with an HUL distributor – central region by Vishal Gutka

• The distributor has not seen a major disruption in the supply chain

so far; says HUL is in a comfortable position to deliver goods in sync with underlining consumer demand.

• However, the current situation has severely affected rural demand, as covid has spread in to the hinterlands, which was not the case in the first lockdown. With rural households undergoing increased anxiety and fear, they are not coming out of their homes to purchase even daily essentials.

• HUL has continued with all its channel partners’ schemes/ incentives this time around; it had significantly curtailed schemes during the first lockdown.

• Shikhar (Digital) app – out of 2,000 outlets that distributors directly reach, as of now, 800 outlets order through this app, since sales people are not able to commute and take orders. He believes that even once the second lockdown ends, this momentum is likely to continue, since retailers are getting additional incentives (above normal margins) to order goods through this app. If retailers are not tech-savvy, sales people assist them in ordering goods through

the app. Incrementally, distributors also get incentives per order, if they fulfil it within 24 hours.

• GSK integration: So far, it does not have GSK consumer products, since the distributor is yet to get a drug license (required for distributing Crocin - paracetamol). The distributor was quite optimistic about improved business prospects, once it gets GSK’s business into its fold, as this will provide a lot of ground to get a foothold into the chemist channel (notably, chemists have been allowed to remain open throughout the day vs. grocery shops, who can operate for restricted working hours).

• He said that HUL’s sanitizer portfolio is not doing very well, given the lack of chemist reach.

• HUL has taken substantial price hikes in soaps, detergents, and the tea portfolio over the past 6-9 months; has received communication that there could be another round of price hikes in the tea portfolio.

• Merging institutional (HORECA; in our view, 5-10% of overall sales) distribution with GT distribution: HUL has started this process in selected geographies. The distributors believes that this process has started since HORECA distribution on a standalone basis in unviable.

• Soaps: Strong traction continues in the soaps and handwash portfolio. Seen a sharp pick up in the past two months due to the start of the season and due to the second covid wave.

• Detergents: No major disruption in the premiumization story. • Tea: Business has more than doubled vs. the previous year because

of massive market-share gains from the loose and unorganized segments as they are not able to cope with RM inflation.

Pan-India channel checks to gauge cigarette demand trends in the wake of the second covid wave Our checks suggest cigarette demand is down 30-40% (ex-Delhi, mom), as most states in

India have imposed lockdowns with restrictions and curfews by Vishal Gutka

Key takeaways from VST Industries’ channel partners • Punjab and J&K market: April demand is down 30-40% on a

sequential basis, as most migrants who had come to Punjab for helping in farms have left for their home states. VST had recently made a big-bang foray into the J&K market with the “Special” brand (priced at Rs 5 / per stick) and the strategy here was to gain market share from Godfrey Phillips, the market leader there.

• Bihar: Although the Bihar government has not imposed a lockdown yet, cigarette demand has reduced 20% sequentially (mom basis) as the state government is implementing the micro-containment-zones strategy.

Key takeaways from ITC’s channel partners • Maharashtra: Cigarette demand is down 40-45% (mom) as many

“hole in the wall” and non-essential shops have been told to shut operations. While the company is able to push some cigarette volume through grocery shops, demand for food items (atta, noodles and biscuits) remains good (i.e., higher than pre-covid levels), but lower than during the first covid wave, as lot of unorganized players are present in the market now, which wasn’t the case in April-May 2020.

• Delhi: Cigarette volume have increased 5% sequentially, in an antithesis to other regional trends. Distributors suggested that this might not be sustainable as a good amount of demand could be due to pantry uploading or panic buying.

18 May 2021 | Vol-3, Issue-5 | Page - 3 Road Less Travelled | MONTHLY NEWSLETTER

RETROSPECTIVE PERSPECTIVE

– by Roshan Sony

Snippets

Key trends of the last few weeks….

“PUT YOUR OXYGEN MASK ON FIRST, BEFORE ASSISTING OTHERS” – the current crisis that India is going through reminds one of flight attendants’ safety demonstrations. The government has come under heavy criticism in the last few weeks, especially about its lack of vaccine preparedness; that it should have made itself atmanirmbhar in terms of medical equipment and beds, before assisting other less-fortunate countries.

Ironically, some of those less fortunate countries have come to India’s aid in its time of need. In fact, most of India’s friends have come forward to help, and some foes as well, with a healthy dose of schadenfreude. Meanwhile, the deadly second wave continues to burn a devastating path – moving from cities, to small towns, to rural India.

Some might call this criticism wisdom in hindsight; after all, the world and WHO lauded India for its generosity when it allowed almost 60mn vaccine doses abroad. It was confident that between Serum Institute and Bharat Biotech, it would vaccinate its population in no time. It seems like the central government never anticipated the vaccine supply shortage that ensued, which is terrifying – the people with access to tonnes of data and the brightest minds are expected to know better. When the second wave hit, only 33mn Indians had received their first dose. The government now promises to have 2bn doses by Aug-Sept, indeed, a possible glut. Is anybody listening?

India did not come under a dark spotlight just in terms of vaccine management. The country’s crumbling and tragically inadequate medical infrastructure, especially its lack of oxygen preparedness, has also been laid bare like never before, severely denting its standing on the international stage. Modi’s efforts to portray the country as an up and coming nearly developed nation have taken a huge hit. Images of burning pyres, bodies floating down rivers and lined up outside crematoriums, blatant profiteering by hospitals and medical equipment suppliers, helpless patients gasping for their last breaths outside hospitals or sending out desperate tweets from their death beds – nobody is going to forget this colossal catastrophe in a hurry.

The crisis has dented India’s image of an ‘almost

arrived’ nation, jostling for space among the most rich

and powerful countries of the world, eager to make its

voice heard in global issues such as climate change or

trade. It is very clear that it really needs to focus on

putting its own house in order first. MASSIVE

VACCINATION OUTREACH IS NEEDED

No mea culpas from India’s high command yet Media op-eds demand more humility and acknowledgement from India’s leaders about poor covid management. For now, the government has turned its attention on upping vaccine production and dissemination. Meanwhile, hurt and grief stricken, people are blaming the complacent administration for their plight. The government says people became careless and covid-fatigue set in. However, commentators say people would not have gathered in large numbers (election rallies, Kumbh mela) had the government not permitted it. Most analysts believe that the crisis precipitated due to complacency (both government and individual) driven by dwindling covid cases between October-March, experts confidently postulating that India seems to have avoided a second wave altogether, the government’s lack of foresight and planning for quick and universal vaccination in India, and political ambitions trumping safety and common sense. One more grievance is that India is one of the few countries that is making people pay for vaccinations; not only that, but the cost of vaccines in the private market is one of the highest in the world at Rs 850 for Covishield, Rs 1,000 for Sputnik V, and Rs 1,250 for the homegrown Covaxin.

Silver linings? Hopefully from here, there will be great improvements to public health infrastructure from here on. Vaccinations is the biggest arrow in the government’s quiver at present, and the general hope is that the government will focus on it single-mindedly. The Indian market continues to be steady, indicating that the financial community’s faith in India’s economic recovery and progress remains intact.

FPIS BUY BIG… BofA report says the value of the foreign portfolio investors' holdings in domestic equities touched a record US$ 555bn in 2020-21, a whopping US$ 105bn growth between September 2020 and March 2021. Against this, domestic institutional investors hold USD 203bn – not even half of FPI holdings in Indian equities.

…BUT PULL OUT IN APRIL, MAY: Snapping a six-month buying spree, spooked foreign investors net sold Rs 97bn in Indian equities. In May so far, they pulled out Rs 65bn.

IPO BOOM: India sees 22 IPOs worth over US$ 2.5bn in Jan-Mar and the trend is likely to stay bullish in Apr-Jun too, says an EY report.

PRIVATE VACCINE IMPORTS: The scramble begins Cries for approving private imports for emergency use are growing. Tenders are being floated. How far these will pan out remains to be seen and seem like a long shot

Many Indian states (including Maharashtra, Orissa, Chhattisgarh) and some private companies (Tata, Reliance) have started talking about importing their own vaccine supplies to inoculate their own against corona, in the face of acute shortages. However, it is not very clear how individual municipal bodies and state authorities are going to sign up their own vaccine procurement deals with foreign vaccine suppliers such as Moderna and J&J, because these companies haven’t really applied for emergency use licences in India. The Uttar Pradesh government recently said that vaccine makers ‘may’ participate in a bid that the state floated recently – but it is all very vague at this stage. So far, Russia’s Sputnik V is the only foreign vaccine that has Government of India approval and while it arrived in India on May 1, it was stuck in ‘testing’ in a Himachal facility –

18 May 2021 | Vol-3, Issue-5 | Page - 4 Road Less Travelled | MONTHLY NEWSLETTER

a process that will happen for each batch; a section of scientists has urged the government to forego this process and rely on the manufacturers’ own quality tests, considering the dire situation in India.

Prime import candidates are Moderna and Novovax because they do not need to be stored at extreme temperatures; however, some reports said Moderna is not that effective against the Indian variant.

Meanwhile the most realistic increase in supply is likely to come Bharat Biotech – as it has now agreed to share its technology with other manufacturers.

Serum Institute of India underdelivers A section of media has accused Adar Poonawala to have ‘fled’ to England, which his father vehemently denies, despite joining him in the UK recently. He says he left after facing violent threats from powerful politicians in India, or it could be simply because his Serum Institute of India (SII), touted to be the world’s largest

vaccine producer, has failed to deliver by a wide margin. Initially, SII had promised 100mn doses of the Covishield vaccine for India and other low and middle-income countries, which it then upped to 1bn doses by the end of 2021 – unclear based on what planning. What IS clear is that SII isn’t likely to deliver on its raised promises.

Also, originally, Serum had planned to make half its doses for India (through or without Covax) and half for the rest of the world. It has fulfilled neither, even as Poonawala talks to the press about how his country comes first for him. SII has not delivered on its promise to Gavi Alliance either, from which it received a US$ 300mn grant from the Gates Foundation to supply 200mn doses for poor countries, including India. In fact, SII is offering Nepal its money back for a second tranche that it cannot deliver, partly because India has clamped down on vaccine exports from March.

Even in terms of pricing, SII has disappointed, but so has Bharat Biotech. Late April, it defended its decision to sell Covishield at 1.5 times the initial rate it had promised, saying that the former price was based on advance funding and that it must invest in scaling up and expanding capacity to produce more shots. It may have failed to deliver, but SII’s profits continue to surge! In 2019-20, 418 Indian companies posted revenues of above Rs 50bn. And in term of profitability, Serum Institute of India was tops.

A scan on current vaccines CONVENTIONAL INACTIVATED VACCINES Bharat Biotech - BBV152 - COVAXIN

Has emergency authorisation in a few countries other than India.

81% efficacy after second dose; claims 100% prevention of severe Covid-19.

It is costly – priced at Rs 1,250.

Needs regular refrigerator temperature for storage.

Two doses – 4-6 weeks apart.

Produced in-house in Hyderabad and Bangalore with a capacity of c.700mn doses.

In a rare display of competitors joining hands, Hyderabad based Indian Immunologicals Ltd confirmed it will start rolling out Covaxin from July-August 2021 – which might provide some relief to India.

In April 2021, India’s Haffkine Institute procured manufacturing rights via technology transfer; but this is likely to roll out only after March next year as it has to build a new containment facility. This also holds true for public sector undertaking Bharat Immunologicals and Biologicals based in Bulandshahar, Uttar Pradesh, which will eventually make Covaxin too.

Sinovac COVID-19 vaccine - CORONAVAC

Developed by the Chinese company Sinovac Biotech.

Needs regular refrigerator temperature for storage.

Used in vaccination campaigns by certain countries in Asia, South America, North America, and Europe.

In April, Sinovac had a production capacity of 2bn doses a year and had delivered 260mn worldwide.

Manufactured in China.

79% efficacy. RNA VACCINES Pfizer–BioNTech - COMIRNATY

Manufacturing in its own facilities in the US and in Europe.

Two doses, three weeks apart.

Potential efficacy of 91% in preventing infection within seven days of the second dose.

Distribution and storage are a challenge; needs to be stored at extremely low temperatures.

Authorized for use at some level in 84 countries including the United States, the European Union, the United Kingdom, Ukraine, Israel, Brazil, Mexico, Japan, and Singapore.

Aim to manufacture about 2.5bn doses in 2021. Moderna COVID-19 - MRNA-1273

Relies extensively on contract manufacturing.

Aims to make 800mn doses in 2021.

Can be stored in a standard medical refrigerator.

Two doses, four weeks apart.

Authorized for use in c.45 countries including USA, Canada, in the EU, the UK, Israel, and Singapore.

94% efficacy two weeks after second dose VIRAL VECTOR VACCINES (genetically modified virus) Oxford–AstraZeneca vaccine - COVISHIELD and VAXZEVRIA

81% efficacy two weeks after second dose.

Retails at c.Rs 850 in India.

First approved for use in the UK; now has approval from European Medicines Agency, Australian Therapeutic Goods Administration, and World Health Organization (emergency approval only so far).

Two doses, 4-12 weeks apart.

Stable at refrigerator temperatures.

AstraZeneca claims to have established 25 manufacturing sites in 15 countries, including Serum Institute of India at Pune.

Sputnik V

Adenovirus viral vector vaccine.

Claims 92% efficacy.

Stable at refrigerator temperature.

By Feb 2021, over a billion doses of the vaccine had been ordered for immediate distribution globally.

18 May 2021 | Vol-3, Issue-5 | Page - 5 Road Less Travelled | MONTHLY NEWSLETTER

As of March 2021, the Russian Direct Investment Fund (RDIF) has licensed production in India, China, South Korea and Brazil.

Expected to sell 250mn doses to the Indian government with Dr. Reddy's Laboratories as the marketing partner; will be imported for now. May begin production from July.

Sputnik V doses to be manufactured in South Korea are not for domestic use. They will be exported to Russia, Algeria, Argentina, Hungary, Iran, and the United Arab Emirates.

PROTEIN ADJUVANT VACCINE Novavax - NVX-COV2373

2 doses, three weeks apart.

Contains the spike protein of the coronavirus itself, but formulated as a nanoparticle, which cannot cause disease.

96.4% efficacy in reducing mild and moderate disease.

To be manufactured in the US, UK, Spain, and Poland. ------------------------------------------------------------------------------------------ COVID TRENDS BY COUNTRY

Fallen and continues to fall sharply: US, Germany, France, Italy, Turkey, Poland, Indonesia, India

Just started falling: India, Canada, Netherlands,

Steady at low levels: Spain, UK, Mexico, Belgium, Russia

Rising: Japan, Brazil, Thailand

Steady at high levels: Sweden, Saudi Arabia

Almost non-existent: China, Australia, Nigeria ------------------------------------------------------------------------------------------ COVID MANAGEMENT AND POPULARITY OF LEADERS: Morning Consult Political Intelligence poll showed PM Modi’s political rating taking a sizeable hit while UK’s Boris Johnson’s improved dramatically. Other leaders who take a hit are Germany’s Angela Merkel, Canda’s Justin Trudeau, and South Korea’s Moon Jae-In. Interestingly, despite Modi’s approval taking a hit, he remains the politician with the highest net approval score among a selection of world leaders.

Will lifting vaccine IPs lead to faster rollouts? The WTO has proposed to temporarily lift intellectual property protections for Covid-19 vaccines to boost production around the world and the Biden administration has supported this, while

pharmaceutical companies have voiced their opposition. Many believe this is the right thing to do especially

because companies have used public funding to develop their vaccines in record time. US and Germany have been the largest investors in this R&D at about US$ 3.5bn combined, and out of the nearly US$ 6bn investment into vaccine research, 98% was via public funding. Critics of this approach point out that the holdup is on the production side, not IP, and that lifting IP could even lead to issues such as counterfeit vaccines. BioNTech’s head has come out and said there is no need to lift IPs as the company will be able to supply as many vaccines as necessary, and in time.

Moderna expects to earn US$ 19.2bn for its Covid-19 vaccine in 2021 while Pfizer estimates US$ 26bn revenue. According to a report by US health data company IQVIA Holdings Inc, total global spending on Covid-19 vaccines should reach US$ 157bn by 2025, driven by mass vaccination programs and "booster shots" every two years.

Other short takes

BIG TECH ROARS: Profits of GAFAM (Google, Apple, Facebook, Amazon, and Microsoft) surge at the beginning of 2021 because of online advertising strength and stimulus-fuelled consumer spending.

FEARS OF 'FULL-SCALE WAR' AS ISRAEL-PALESTINIAN CLASHES ESCALATE: Israel intensified its airstrikes against Hamas-ruled Gaza in response to a fresh barrage of rockets targeting the country’s densely populated centre, in the heaviest exchange of fire since the two sides fought a war in 2014.

INFLATIONARY PRESSURES RISING GLOBALLY: China’s factory-gate prices jumped by the most in over three years in April. US consumer inflation surged in April to 4.2%, up from 2.6% in March; this was the biggest increase since September 2008.

CRYPTOCURRENCY: Elon Musk continues to play king-maker and breaker for cryptocurrency, more of the latter at the moment. Calls dogecoin a "hustle" on a TV show after which its value fell. Goes on to say Bitcoin eats up too much energy, is bad from the environment, and reverses decision to accept Bitcoin as a payment mode for Tesla. Then implies in a Twitter exchange that Tesla may sell or has sold its cryptocurrency holdings. The hottest currency at the moment is Ethereum, which has zoomed 400% since early 2021 and is at c.US$ 4,000; Bitcoin has gained 100% in the same time. Ethereum founder Vitalik Buterin donated US$ 1bn in crypto for covid-19 relief in India.

CHANGE IN THE STRUCTURE OF GLOBAL TRADE: The tariff war seems to have had an effect. There is a sizeable decrease in Chinese imports into the US; Americans have begun to buy telecommunications gear, furniture, apparel, etc., from other countries.

Light at the end of the tunnel for the first world In the US, 22 states lifted almost all coronavirus restrictions. UK is in the process of gradually lifting its lockdown. Things are generally looking up for the western world and bode well for global GDP growth. Vaccinations (first dose) are at more than 50% for both countries and major airlines in the US have ‘sensed’ that leisure travel is rebounding – this could be the path for India too once vaccinations accelerate. However, something odd is happening in America. Americans are paying down their credit-card debt at levels not seen in years; also, the mortgage market is losing steam, even as housing is doing well.

18 May 2021 | Vol-3, Issue-5 | Page - 6 Road Less Travelled | MONTHLY NEWSLETTER

Central Vista project comes under heavy criticism “Govt should deploy resources in saving lives rather than building the PM's new house”: Priyanka Vadra

Central Vista Redevelopment Project refers to the ongoing redevelopment to revamp Central Vista, India's central administrative area located near Raisina Hill, New Delhi. The project, especially its timing, has come under heavy criticism from opposition parties and former civil servants, who have questioned the need to spend

money on the project during a pandemic. The international media has also been super critical, saying the money could have been directed towards reinforcing India’s crumbling public health infrastructure.

Start date: December 2020

Planned completion date: 2024

Cost estimate: Rs 200bn (c.US$ 3bn)

Completion date: 2024 (planned) What will it do?

Revamp the 3km long Rajpath – between Rashtrapati Bhavan and India Gate.

Convert North and South Blocks to publicly accessible museums by creating a new common Central Secretariat to house all ministries.

A new parliament building near the present one with increased seating capacity for future expansion.

New residence and office for the Vice President and the Prime Minister near the North and South Blocks.

Convert some of the older structures into museums. Note: Views, if any, expressed in this section, are the author’s own.

News round-up of the month – by Roshan Sony

A p r i l ( 1 5 - 3 0 )

INDIA Despite shortages, govt opens vaccinations for

everyone above 18 from May 1.

A large part of the country remains under strict

curbs and lockdowns – which continue into

May.

PM Modi holds virtual summit with British

counterpart Boris Johnson.

Commercial banks can pay 50% of pre-COVID

dividend for FY21, says RBI

Fitch affirms BBB- rating, says COVID surge

may delay economic recovery.

S&P forecasts 11% growth for India in FY22.

India's fuel sales drop 9.4% in April on Covid wave.

Mukesh Ambani's Reliance Industries buys Britain's iconic country club and luxury golf resort, Stoke Park, for 57 million pounds (about Rs 6bn).

Retail inflation eases to 4.29% in April on decline in food prices.

INTERNATIONAL United States of America:

Fed keeps ultra-low interest rates in place ● Biden signs EO raising minimum wage for fed contract workers to US$ 15 / hour with effect from March ● US jobless claims hit 13-month low ● GDP grows 6.4% (annualised) between January and March ● CDC eases masking recommendations for fully vaccinated people outdoors ● US says will give up to 60mn doses

of the AstraZeneca coronavirus vaccine to countries in need.

Turkey goes into first full lockdown.

Nearly 45 killed in stampede at Israeli religious festival.

Australia scraps agreements tied to China's Belt and Road initiative.

UK bans travel to/from India; US recalls all its citizens.

Saudi prince strikes conciliatory tone with rival Iran.

Covaxin effective against India, UK coronavirus strains: Bharat Biotech.

Former Maruti MD Jagdish Khattar passes away.

M a y ( 1 - 1 5 )

INDIA Assembly election (state) results

West Bengal: Mamata Banerjee's Trinamool Congress (TMC) clinches a landslide victory, defeating the Bharatiya Janata Party (BJP) to form the government for a third consecutive term. It won 214 seats, while BJP won 76.

Puducherry: The BJP-led National Democratic Alliance (NDA) defeats the Congress. NDA wins 16 seats out of 30.

Kerala: Four-decade trend of the incumbent never getting re-elected is broken. Left Democratic Front led by Pinarayi Vijayan gets 99 seats out of 140. UDF wins just 41 seats.

Tamil Nadu: Dravida Munnetra Kazhagam -led Secular Progressive Alliance sweeps in with 159 seats out of 234. AlI India Anna Dravida Munnetra Kazhagam and its alliance wins just 75 seats.

Assam: BJP-led NDA wins a comfortable 75 of the 126 seats.

-------------------------------------------------------------------

Fuel prices rise across the nation.

WPI inflation rises steeply to 10.49% in April.

Mucormycosis, also known as black fungus, a

rare but dangerous disease, affects hundreds

of covid patients.

Govt OKs 13 applications for 5G trials.

Cairn Energy goes on the offensive, identifies

US$ 70bn Indian foreign assets for potential

seizure if the government fails to honour a US$

1.72bn international arbitration award.

Pakistan and Venezuela faced similar

enforcement action over failure to pay up.

Indian Premier League proves short-lived; indefinitely suspended with many players testing positive.

Crisil says second wave of COVID-19 could bring down GDP growth to 8.2% if cases peak by June-end.

Intl passenger flights suspended till May 31.

Indian lenders brace for further deterioration in asset quality metrics, cheque-bounce rates, and collection ratios in May.

IMF says to revisit growth forecast for India due to surge in COVID-19 cases.

Baring Private Equity Asia decides to sell Hexaware Technologies.

Barclays cuts India's FY22 GDP growth forecast to 10%; says local lockdowns to cost US$ 38bn till June.

A potential cancer drug repurposed for Covid-19 treatment – 2-deoxy-D-glucose (2-DG) – receives nod for emergency use for moderate

18 May 2021 | Vol-3, Issue-5 | Page - 7 Road Less Travelled | MONTHLY NEWSLETTER

to severe Covid-19 patients. Supposed to reduce mortality significantly.

RBI relaxes KYC norms, tells banks not to impose any restriction till Dec-end; extends Rs 500bn for Covid war, relief for small borrowers; allows loan restructuring for individuals. Says will make available an on-tap liquidity window of Rs 500bn with a tenor of up to three years.

Faced with vaccine shortages, centre tells states to prioritise second dose. Then extends the timing between doses.

Pfizer, Moderna vaccines  show limited effectiveness on Indian strain.

Passenger vehicles sales slump 25% in April over March.

Finance ministry estimates GDP growth at 9.5-10.0% in FY22.

INTERNATIONAL China’s iron ore futures at record highs.

Bill and Melinda Gates divorce after 27 years of marriage.

Israel and Gaza – violence escalates.

US: Employment growth slows sharply in April amid labour shortages ● US birth rate down 4% in 2020 vs. 2019; new births at lowest since 1979 ● Covid deaths hit lowest level in 10 months ● Average gasoline price climbed to over US$ 3/gallon for the first time since 2014 – people seen hoarding gas amid shortage fears ● Defense Department removes Xiaomi Corp. from a blacklist banning US investment in the Chinese tech giant ● Restaurant Revitalization Fund: US$ 29-bn covid-aid programme for the US food service industry opens ● US is set to withdraw its troops from Afghanistan by 11 September. But peace talks between the Afghan government and Taliban militants are floundering amid continuing bloodshed ● Pfizer's COVID-19 vaccine gets FDA approval for emergency use

in children ages 12-15 ● Fully vaccinated people not required to wear masks.

BoE keeps benchmark at all-time low of 0.1%; bond-buying unchanged at GBP 895bn (USD 1.24tn).

Germany approves J&J, AstraZeneca vaccines for all adults.

Study claims actual Covid deaths in most

nations way higher than official numbers.

Taiwan rations water, drills extra wells amid record drought.

Germany busts international child sexual exploitation site used by 400,000.

High-ranking diplomats from China, Germany, France, Russia, and Britain resume talks focused on reenlisting the US into landmark nuclear deal with Iran.

China's population grows marginally to 1.412 billion, may begin to decline by 2022.

Oxitec – a British biotech company – releases genetically modified mosquitoes in Florida to eventually kill off disease-carrying mosquitoes. Said to have 90% success rate in countries like Brazil and Malaysia.

China rocket debris splashes down in the Indian Ocean. Chinese spacecraft carrying the country's first Mars rover touches down on the red planet,

Singapore tightens safety measures amid surge in Covid-19 cases.

Oli reappointed Nepal PM as Opposition fails to muster majority to form new govt.

Moody's upgrades outlook for global aviation industry to 'positive'.

Source: Various media publications

Key indicators

T r e n d r e v e r s a l s Rupee, rising

Retail inflation, falling

Loan growth, rising

RBI balance sheet, sharp fall

IIP, up sharply

Imports, exports, and car sales fall (mom)

Sensex Flat

Gold Rising

Rupee Rising

Oil (Brent) Rising

10-year G-Sec Yield Falling

Retail inflation (Apr 2021, mom) Falling

India Producer Price Index (Apr) Rising

India WPI (Apr) Rising

Prime lending rate (May 2021) Steady

Loan growth (Apr 2021, mom) Rising

RBI balance sheet (March, mom) Falling

Current account deficit (Q4 2020) Rising

IIP (Mar 2021, yoy) Rising

Manuf. PMI (Apr 2021, mom) Steady

Services PMI (Apr 2021, mom) Steady

Forex reserves (7 May) Rising

Gold reserves (Q4 2020) Rising

Exports (Apr, mom) Falling

Imports (Apr, mom) Falling

Trade deficit (Apr, mom) Rising

Car production (Mar, mom) Rising

Car sales (Apr, mom) Falling

Aluminium price (30-day) Rising

Aluminium stock (30-day, LME) Falling

Copper price (30-day) Rising

Copper stock (30-day, LME) Falling

Zinc (30-day) Rising

Zinc stock (30-day, LME) Falling

18 May 2021 | Vol-3, Issue-5 | Page - 8 Road Less Travelled | MONTHLY NEWSLETTER

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This report does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive this report. Investors must undertake independent analysis with their own legal, tax and financial advisors and reach their own regarding the appropriateness of investing in any securities or investment strategies discussed or recommended in this report and should understand that statements regarding future prospects may not be realized. In no circumstances it be used or considered as an offer to sell or a solicitation of any offer to buy or sell the Securities mentioned in it. The information contained in the research reports may have been taken from trade and statistical services and other sources, which we believe are reliable. PhillipCapital (India) Pvt. Ltd. or any of its group/associate/affiliate companies do not guarantee that such information is accurate or complete and it should not be relied upon as such. Any opinions expressed reflect judgments at this date and are subject to change without notice

Important: These disclosures and disclaimers must be read in conjunction with the research report of which it forms part. Receipt and use of the research report is subject to all aspects of these disclosures and disclaimers. Additional information about the issuers and securities discussed in this research report is available on request.

Certifications: The research analyst(s) who prepared this research report hereby certifies that the views expressed in this research report accurately reflect the research analyst’s personal views about all of the subject issuers and/or securities, that the analyst have no known conflict of interest and no part of the research analyst’s compensation was, is or will be, directly or indirectly, related to the specific views or recommendations contained in this research report. The Research Analyst certifies that he /she or his / her family members does not own the stock(s) covered in this research report.

Independence: PhillipCapital (India) Pvt. Ltd. has not had an investment banking relationship with, and has not received any compensation for investment banking services from, the subject issuers in the past twelve (12) months, and PhillipCapital (India) Pvt. Ltd does not anticipate receiving or intend to seek compensation for investment banking services from the subject issuers in the next three (3) months. PhillipCapital (India) Pvt. Ltd is not a market maker in the securities mentioned in this research report, although it or its affiliates may hold either long or short positions in such securities. PhillipCapital (India) Pvt. Ltd does not hold more than 1% of the shares of the company(ies) covered in this report.

Suitability and Risks: This research report is for informational purposes only and is not tailored to the specific investment objectives, financial situation or particular requirements of any individual recipient hereof. Certain securities may give rise to substantial risks and may not be suitable for certain investors. Each investor must make its own determination as to the appropriateness of any securities referred to in this research report based upon the legal, tax and accounting considerations applicable to such investor and its own investment objectives or strategy, its

financial situation and its investing experience. The value of any security may be positively or adversely affected by changes in foreign exchange or interest rates, as well as by other financial, economic or political factors. Past performance is not necessarily indicative of future performance or results.

Sources, Completeness and Accuracy: The material herein is based upon information obtained from sources that PCIPL and the research analyst believe to be reliable, but neither PCIPL nor the research analyst represents or guarantees that the information contained herein is accurate or complete and it should not be relied upon as such. Opinions expressed herein are current opinions as of the date appearing on this material and are subject to change without notice. Furthermore, PCIPL is under no obligation to update or keep the information current.

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Caution: Risk of loss in trading/investment can be substantial and even more than the amount / margin given by you. Investment in securities market are subject to market risks, you are requested to read all the related documents carefully before investing. You should carefully consider whether trading/investment is appropriate for you in light of your experience, objectives, financial resources and other relevant circumstances. PhillipCapital and any of its employees, directors, associates, group entities, or affiliates shall not be liable for losses, if any, incurred by you. You are further cautioned that trading/investments in financial markets are subject to market risks and are advised to seek independent third party trading/investment advice outside PhillipCapital/ group/ associates/ affiliates/ directors/ employees before and during your trading/investment. There is no guarantee/assurance as to returns or profits or capital protection or appreciation. PhillipCapital and any of its employees, directors, associates, and/or employees, directors, associates of PhillipCapital’s group entities or affiliates is not inducing you for trading/investing in the financial market(s). Trading/Investment decision is your sole responsibility. You must also read the Risk Disclosure Document and Do’s and Don’ts before investing. Kindly note that past performance is not necessarily a guide to future performance. For Detailed Disclaimer: Please visit our website www.phillipcapital.in IMPORTANT DISCLOSURES FOR U.S. PERSONS This research report is a product of PhillipCapital (India) Pvt. Ltd. which is the employer of the research analyst(s) who has prepared the research report. PhillipCapital (India) Pvt Ltd. is authorized to engage in securities activities in India. PHILLIPCAP is not a registered broker-dealer in the United States and, therefore, is not subject to U.S. rules regarding the preparation of research reports and the independence of research analysts. This research report is provided for distribution to “major U.S. institutional investors” in reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”). If the recipient of this report is not a Major Institutional Investor as specified above, then it should not act upon this report and return the same to the sender. Further, this report may not be copied, duplicated and/or transmitted onward to any U.S. person, which is not a Major Institutional Investor. Any U.S. recipient of this research report wishing to effect any transaction to buy or sell securities or related financial instruments based on the information provided in this research report should do so only through Rosenblatt Securities Inc, 40 Wall Street 59th Floor, New York NY 10005, a registered broker dealer in the United States. Under no circumstances should any recipient of this research report effect any transaction to buy or sell securities or related financial instruments through PHILLIPCAP. Rosenblatt Securities Inc. accepts responsibility for the contents of this research report, subject to the terms set out below, to the extent that it is delivered to a U.S. person other than a major U.S. institutional investor. The analyst whose name appears in this research report is not registered or qualified as a research analyst with the Financial Industry Regulatory Authority (“FINRA”) and may not be an associated person of Rosenblatt Securities Inc. and, therefore, may not be subject to applicable restrictions under FINRA Rules on communications with a subject company, public appearances and trading securities held by a research analyst account. Ownership and Material Conflicts of Interest

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Rosenblatt Securities Inc. or its affiliates does not ‘beneficially own,’ as determined in accordance with Section 13(d) of the Exchange Act, 1% or more of any of the equity securities mentioned in the report. Rosenblatt Securities Inc, its affiliates and/or their respective officers, directors or employees may have interests, or long or short positions, and may at any time make purchases or sales as a principal or agent of the securities referred to herein. Rosenblatt Securities Inc. is not aware of any material conflict of interest as of the date of this publication Compensation and Investment Banking Activities

Rosenblatt Securities Inc. or any affiliate has not managed or co-managed a public offering of securities for the subject company in the past 12 months, nor received compensation for investment banking services from the subject company in the past 12 months, neither does it or any affiliate expect to receive, or intends to seek compensation for investment banking services from the subject company in the next 3 months. Additional Disclosures

This research report is for distribution only under such circumstances as may be permitted by applicable law. This research report has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient, even if sent only to a single recipient. This research report is not guaranteed to be a complete statement or summary of any securities, markets, reports or developments referred to in this research report. Neither PHILLIPCAP nor any of its directors, officers, employees or agents shall have any liability, however arising, for any error, inaccuracy or incompleteness of fact or opinion in this research report or lack of care in this research report’s preparation or publication, or any losses or damages which may arise from the use of this research report. PHILLIPCAP may rely on information barriers, such as “Chinese Walls” to control the flow of information within the areas, units, divisions, groups, or affiliates of PHILLIPCAP.

Investing in any non-U.S. securities or related financial instruments (including ADRs) discussed in this research report may present certain risks. The securities of non-U.S. issuers may not be registered with, or be subject to the regulations of, the U.S. Securities and Exchange Commission. Information on such non-U.S. securities or related financial instruments may be limited. Foreign companies may not be subject to audit and reporting standards and regulatory requirements comparable to those in effect within the United States.

The value of any investment or income from any securities or related financial instruments discussed in this research report denominated in a currency other than U.S. dollars is subject to exchange rate fluctuations that may have a positive or adverse effect on the value of or income from such securities or related financial instruments.

Past performance is not necessarily a guide to future performance and no representation or warranty, express or implied, is made by PHILLIPCAP with respect to future performance. Income from investments may fluctuate. The price or value of the investments to which this research report relates, either directly or indirectly, may fall or rise against the interest of investors. Any recommendation or opinion contained in this research report may become outdated as a consequence of changes in the environment in which the issuer of the securities under analysis operates, in addition to changes in the estimates and forecasts, assumptions and valuation methodology used herein.

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