Markets Fight To End In The Positive
The markets struggled to stay above water all through the day as bears faced off with bulls and eventually the bulls won
On Episode 481 of The Core Report, financial journalist Govindraj Ethiraj talks to Ajay Shah, well known economist and columnist as well as Vandana Hari, Founder and CEO of Vanda Insights.
(00:00) Stories Of The Day
(01:00) Markets fight to end in the positive
(04:41) The policy flip flop on the rupee and its implications
(19:42) Decoding the sanctions bombshell on Russian oil and impact on India
(28:14) Car sales slow down, more so in the small car segment
(29:19) And the world’s busiest airport in 2024 is…
(30:35) Who does the word schezwan chutney belong to?
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 Wednesday, the 15th of January and this is Govindraj Ethiraj, headquartered and broadcasting and streaming like always from Mumbai, India’s financial capital.
Our top stories and themes
Markets fight to end in the positive
The policy flip flop on the rupee and its implications.
Decoding the sanctions bombshell on Russian oil and impact on India.
Car sales slow down, more so in the small car segment.
And the world’s busiest airport in 2024 is..
Who does the word schezwan chutney belong to?
The Markets Struggle
The markets struggled to stay above water all through the day as bears faced off with bulls and eventually the bulls won, but barely.
The BSE Sensex and NSE Nifty50 also managed to snap a 4-day losing streak to close higher on Tuesday.
The 30-share Sensex rose 169.62 points to settle at 76,499.63 while the NSE Nifty50 settled in the green at 23,176.05, with gains of 90.10 points.
Among the broader markets, the Nifty Midcap100 and Nifty Smallcap100 ended with gains of 2.45 per cent, and 1.98 per cent, respectively.
The outlook continues to stay grim though there are technical fight backs everywhere.
Investors are expecting Indian stocks to post another quarter of losses thanks to slowing growth in the economy and corporate earnings which in turn is affecting foreign flows.
The benchmark NSE Nifty 50 Index will likely drop at least 5% in the three-months through March, according to a majority of 22 strategists and fund managers in an informal survey conducted by Bloomberg early this month.
Donald Trump’s presidency which starts next week is not helping obviously.
India’s nearly $5 trillion equity market has and the aggregate market value of companies included in the MSCI India Index has declined by $556 billion after the gauge fell more than 13% from a September peak.
There are no reasons quoted of course, except newer symptoms or old symptoms like falling vehicle sales which are being examined afresh and more on that shortly.
HSBC Holdings Plc. strategists have downgraded Indian stocks to neutral last week, saying investors will likely re-evaluate their positions after consensus reduced FY25 earnings growth estimates for the Nifty 50 to 5% from 15%.
I repeat from 15% growth estimate to 5% for the current year for Nifty50 companies.
A third of the survey respondents said the Nifty 50 gauge will rise 10% to 15% in 2025 which is largely what fund managers have been telling us in the last couple of months.
There are many who expect negative returns on a full year basis.
Let's see.
In the last quarter, the Nifty 50 fell 8.4% last quarter but still gained 8.8% in 2024, its ninth straight year of gains, Bloomberg reported.
In terms of stocks and themes, the survey respondents said healthcare and IT would benefit from the low rupee in terms of exports.
Investors appear to feel real estate will not grow much this year given the 110% rally in the sector index last year.
Overall, there are signs of the real estate market flattening in 2025 as The Core Report has been seeing.
Action on the Debt Side
India’s biggest fixed-income funds are ramping up positions across the market as they prepare for the central bank to start easing monetary policy this year, Bloomberg is reporting adding that some are predicting the Reserve Bank of India will inject cash into the banking system before cutting interest rates, piling into money market instruments and shorter-maturity corporate bonds to benefit from such an approach.
Longer-tenor sovereign debt and even riskier credit are some of the other favored bets.
Interest rates have not changed for almost two years now, but a cash deficit of about two trillion rupees ($23 billion) in the banking system coupled with slowing economic growth has sparked expectations that new Governor Sanjay Malhotra may prioritize enhancing liquidity before potentially reducing borrowing costs in February, Bloomberg said.
All this could lead to sovereign bond yields dropping.
What Does One Do About Exchange Rate
The Indian rupee hit an all-time low on Tuesday thanks to strong dollar bids, while likely intervention by the Reserve Bank of India helped cap losses, traders told Reuters.
The rupee hit a record low of 86.6475 before closing at 86.63 against the U.S. dollar, down from its close at 86.5750 in the previous session.
Meanwhile, the dollar index was last quoted at 109.5, having just cooled off its two-year peak, which gave some breathing room to most Asian currencies.
On Monday, the INR logged its steepest single-day fall in nearly two years on Monday even as the dollar scaled an over two-year high on fading bets of U.S. interest rate cuts this year.
The larger issue which we will dive into is whether the Reserve Bank of India is letting the rupee go.
Anecdotal evidence is pointing in that direction but it is interesting that a policy of maintaining a tight exchange rate band that was perhaps too dogmatically pursued for the last few years and praised is now being questioned, in action if not in words.
And now, with a new Reserve Bank governor, the approach seems to be to let the rupee float a little if not a fair bit.
That would suggest the Governors alone are driving the thinking behind exchange rate management.
Which is of course difficult to believe.
Nevertheless, Bloomberg is quoting internal sources to say that the new governor has shown a willingness to allow the rupee to move more freely in tandem with peers in the region while still intervening in the foreign-exchange market to curb excessive moves.
In multiple meetings, RBI Governor Sanjay Malhotra, who took office in December, has shown keen interest in the RBI’s currency intervention functions and expressed no opposition when his team explained the recent movements in the rupee and the need to allow it to depreciate, Bloomberg is reporting.
Under Shaktikanta Das' six years at the RBI, the rupee’s volatility fell to the lowest among emerging markets, second only to the pegged Hong Kong dollar.
The RBI also built up the world’s fourth-biggest foreign exchange reserves of more than $700 billion and then used it to defend the currency.
Well known economist and columnist Ajay Shah argued recently that spells of a managed exchange rate, followed by large changes, are the worst of all worlds.
He says such a regime lulls firms into complacence: they take on more exchange-rate risk, and fail to develop organisational capability for the real world where exchange rates fluctuate.
And then, inevitably, it always happens that the government is no longer able to control the price, a big price change then comes along.
The firms” even the good firms lack the organisational capability to cope with price fluctuations and get hurt, he argues
Are we at such a point now ? More on that coming up but Shah also says that you cannot buy flood insurance once the waters start rising: It takes decades for a capable insurance industry to develop.
The firms respond in the political economy, lobbying the government to block price fluctuations, which reinforces the worst elements of the public-policy landscape.
He says this interferes with the main journey of economic growth.
It is always tempting to achieve political objectives, or to support firms in genuine distress, by preventing the operations of markets.
I reached out to Ajay Shah and began by asking him why he was against a managed currency and also what in his mind should be the RBI’s principal focus and emphasis.
INTERVIEW TRANSCRIPT
Ajay Shah: The exchange rate is a price and government management of prices mostly works badly. I mean, this is the core insight of economics. Economics is the study of the price system.
The supply and demand make the price and the price should be seen as information wrapped in an incentive. So when there is a shortage of tomatoes and the price of tomatoes goes up, so people eat less tomatoes and grow more tomatoes. That's about it.
It is as simple as that. And when a government says that, no, I will not allow the price of tomatoes to change, then those responses inside the economy are snuffed out. So you don't have people eating less tomatoes and you don't have people producing more tomatoes.
So the imbalance in the economy just persists. This is a very generic view of the price system that the glory of the market economy is all about prices. Everyday prices change and all of us respond to the prices.
We don't study the country. We are not obliged to do good things for the country. We only look out for ourselves.
We look at the price. We change our behaviour based on the price and based on our self-interest. And that's what keeps the whole ship running.
So to interfere with prices is really a problem at core. So it is attacking the heart and soul of how the market economy works. Right.
Govindraj Ethiraj: And I'm going to ask you for any other examples from elsewhere, but in a moment. So you've quoted, for example, again, the example of, let's say, steel or lithium-ion batteries. I mean, these are products or commodities where prices fluctuate and which in turn obviously sends different demand and supply signals.
Now, my question is, can exchange rate or the buying of dollars or the selling of dollars against the rupee be compared to buying, let's say, steel or lithium-ion, as you say?
Ajay Shah: It's a price. There's supply, there's demand. If the government will allow the market to work, which is an if.
If the government will allow the market to work, the market is fully able to discover the price. We have so many countries in the world that are living examples that the exchange rate is a price. The price fluctuates every day and it solves problems.
So just to help readers, when things are bad in India, you get an exchange rate depreciation that increases Indian export demand. So companies in India that are exporting do better and it crimps import demand because foreign goods in India become more expensive. There's no better tonic for the economy than restricting foreigners who are selling goods into India, competing with Indian companies and giving additional business to Indian companies who are exporting.
It is pitch perfect and vice versa. When things are very good in India, when the economy is overheating, the exchange rate will appreciate. So it is a stabilising force that makes everybody's life better.
So to allow that exchange rate to do its work is actually a pretty wise thing.
Govindraj Ethiraj: So I'm going to come to the impact of this on firms and you've talked about that. But before that, so this was not always the strategy or you feel that this strategy has changed in recent years and which is why it has maybe in your view or impression caused more harm.
Ajay Shah: So there was a long journey in India where these kind of arguments were played out. So if you begin at the early 90s, there was a long period where Rangarajan was governor and the exchange rate was fixed at 31.37 every single day. That's where we started.
We started from a completely fixed approach. And then over the years, one by one, the economists and the central bank staff and the Ministry of Finance staff grudgingly understood the theoretical idea that you know what, don't mess with the exchange rate, that it will bite you, it will get you into trouble. It is the wisdom of practical people that you don't mess with exchange rates.
So abundance of interest in managing the exchange rate is the hallmark of people who have not actually experienced macroeconomic policy over long periods of time. And over the years, we got better and better. So while every RBI governor staunchly laid claim that all the exchange rate, we will do a great job, we will make sure nothing goes bad.
In fact, in the reality, they kept liberalising the exchange rate and exchange rate flexibility went up. There were no announcements. But the reality is that exchange rate flexibility went up.
So exchange rate flexibility went up with Bimal Jalan. It went up with YV Reddy, who staunchly claimed that the exchange rate is being managed by him. But truly, if you look in the data, exchange rate flexibility went up.
Exchange rate flexibility went up further with Subbarao as governor. And so this long run process of emerging as a market economy changed when Raghuram Rajan became governor, when the exchange rate became more managed and changed even more after 2022, when the exchange rate became highly managed. And I feel that in that period, we lost a shock absorber for the economy.
Good news and bad news should play out with the exchange rate and that stabilises the economy. And so actually, the difficulties we've had after 2022 were exacerbated by the new exchange rate policy, which began in about 2022.
Govindraj Ethiraj: But this policy too was never stated, isn't it? I mean, what we're discussing right now.
Ajay Shah: It's a very unhappy thing that you need to be an econometrician like me to study the data and understand that, oh, the exchange rate regime has changed. That's not a healthy thing in a liberal democracy. In a liberal democracy, the state is obliged to justify and explain every policy action to the people.
Govindraj Ethiraj: Okay. Let's talk about the impact on firms. You're arguing that basically this also in, to put it simply, spoils firms or spoils enterprises because they don't have to manage this and they take it for granted.
Ajay Shah: First of all, all prices fluctuate. Okay. If you are in business, then your job is to watch that fluctuating world and figure out how to make money.
And if you can't handle fluctuating prices, you should not be in business. So first, let's be clear about the burden of responsibility upon firms. If you are a firm, you're here to make money and all your input prices fluctuate.
If you are Britannia and you make biscuits, you are in the game of watching the world where the price of wheat changes, the price of sugar changes, the price of palm oil changes, everything fluctuates. And the job of Britannia is to stand in that fluctuating world and make money. And if you can't do that, you should not be in business.
So dealing with fluctuating prices is the business of business. Now, into that, if the government will come along and fix a price, businessmen will say, oh, so nice. It's like my life is being made easier and they will always applaud.
So you will always get positive press by managing an exchange rate. But the thing is, this doesn't work. You can't manage an exchange rate for any extended period of time.
The world will always catch up with you and then you will have a pent up large change which will come along. So I want to give you an analogy with the prices of petroleum product. So the Indian government used to have a fixed price of petrol for many days and many months.
And actually a gap would build up and the difficulties would accelerate because the world price of crude oil would have moved significantly. But in India, you know, we don't allow prices to move. We're a socialistic country.
The government controls the price and the gap would become bigger and bigger. And then one fine day there would be a big change in the price of petrol, which is actually worse. It's actually more disruptive to have a sudden big change rather than having a large number of small changes every day.
And in the case of petrol, this story is largely completed. The Indian state now passes on petrol price changes all the time. We don't do this business of a stop start where we will have a fixed price of petrol for a long time and then suddenly it will change.
So now think about the firms who face a relatively fixed exchange rate and it lulls them to complacence. They stop thinking about the exchange rate. They don't do risk management using derivatives of their own exchange rate exposure.
And they actually become soft. What you need is the skill, the strength of managing exchange rate fluctuations all the time. And then suddenly a big change comes as it inevitably will, because no government can fix the price.
Govindraj Ethiraj: So what could be that gap, the big gap or change that could hit us because we've managed exchange rate so tightly, particularly in recent years?
Ajay Shah: So we're already seeing a significant INR depreciation, which is catching a lot of people by surprise. Ila Patnaik and I have a paper where we demonstrate that in these periods where there is low exchange rate flexibility, the firms take on more exchange rate risk because they're saying, look, the government is my risk manager. I'm happy to free ride on that.
And then when the period of greater exchange rate flexibility comes, the very same firms bring down their own exchange rate exposure. So they know how to do it. They can do it.
But you just have this disruptive period in between where a pent up exchange rate movement gets expressed. And then those are turbulent periods. All the speculators of the world come on to one side.
The jargon in the field is that it's a one way bet, that by betting on rupee depreciation, I'm only going to make money. And once it smells like that, no amount of power of the Indian state or of the central bank can possibly resist because ultimately there is more power in the private markets, in private people as compared to anything that the Indian state can muster. So then you're setting yourself up for a large, messy exchange rate depreciation.
It may overshoot. There will be a lot of grief.
Govindraj Ethiraj: We definitely are seeing depreciation right now. Hence this conversation. So do you feel that we're finally letting go?
And because some economists have been arguing to this effect in recent months as well.
Ajay Shah: So there is undoubtedly some depreciation. The proof of the pudding lies in the behaviour of RBI. You can't readily see this only in the currency data.
In my mind, the two tests are rule one, that the RBI should not be trading the market. Nobody should do market manipulation of financial markets. If somebody tries to manipulate the share price of Infosys, they should get a semi-enforcement action against them.
Financial markets are the free play of supply and demand, and you should not have any big player trying to control the price. And part two is that RBI now has a legal mandate. They're an inflation-targeting central bank.
They should be setting their interest rate so as to deliver on a 4% inflation target. They should not have extraneous objectives.
Govindraj Ethiraj: And you've said that RBI should basically focus on inflation and leave everything else to the markets, particularly in the context of foreign exchange.
Ajay Shah: Set the short-term interest rate so that we will get to the inflation target of 4% CPI. And the exchange rate is not the business of the Reserve Bank of India.
Govindraj Ethiraj: Right. Ajay, it's been a pleasure talking to you. Thank you so much for joining me.
Ajay Shah: My pleasure.
Oil Prices Ease Off
Oil prices paused their rally on Tuesday, but remained near four-month highs, with the market's now focused on the impact of new U.S. sanctions on Russian oil exports to India and China.
Brent crude was down 54 cents to $80.47 a barrel Tuesday evening after having jumped 2% on Monday after the U.S. Treasury Department on Friday imposed sanctions on Gazprom Neft
and Surgutneftegas as well as 183 vessels that transport oil as part of Russia's so-called "shadow fleet" of tankers.
So will the physical impact on oil supplies be as pronounced as feared and what is the overall scenario building upto particularly in the context of overall demand and supply trends as we advance into 2025.
I reached out to Vandana Hari, Singapore based founder and CEO of Vanda Insights and began by asking her how she was seeing the bombshell of the Biden administration to impose additional sanctions on Russian oil exports.
INTERVIEW TRANSCRIPT
Vandana Hari: As we know and as you've been talking on your show through last year as well, pretty much 100% of Russian crude exports have been going to China and India. So Russia exports about 4.5 million barrels per day of crude, a little over 2 million barrels per day of refined products. Now, what the sanctions really stand out, the aspect that perhaps was the most surprising was how extensive they were.
Aside from the fact that, you know, coming from an administration that will be out the door in 10 days, you know, and it really depends on Donald Trump and his administration, whether they scrap or they keep the sanctions or they use them as leverage. But aside from that, the wide-ranging nature is a first in terms of all the sanctions we've seen implemented since 2022. So this time they are covering the entire supply chain, you know, from a couple of Russian producers.
Of course, they are the smaller producers compared to Rosneft, but nonetheless, they, you know, together Gazprom Neft and Surgut Neftogaz pump about 1 million barrels per day. So that's substantial. The sanctions cover a range of shipping companies, ship owners, operators, about 183 vessels, most of them oil tankers that the U.S. says were used in transactions that busted the $60 barrel price cap. The sanctions cover two major Russian maritime insurance providers. They cover a whole scores of middlemen, you know, trading companies that are instrumental in conveying Russian crude and refined products to the markets. So it's quite wide ranging.
Some of the implementation measures were not clear for several hours or a few days after they were announced, which has caused quite a bit of confusion and chaos amongst refiners in China and India.
Govindraj Ethiraj: Right. So you said 100% of Russian exports go to China and India. For India, it's about more than 30% of its imports.
So what happens now? So will Russia be forced to export at lower rates, including that $60 price, which in a way could be beneficial then for India for sure, and maybe China as well?
Vandana Hari: That is the hope of the U.S. administration, because let's face it, that's the sort of interim aim. Of course, the final aim is to get Putin to withdraw from Ukraine, but that's the interim aim. And that is the hope.
Most likely it will, because as it gets harder for Russia to ship its crude to the destination markets, the freight rates go up. And when freight rates go up, it is a buyer's market, right? China and India, the buyers are going to say, you know, it's become too expensive for us.
So in return, then Russia has to reduce the FOB price of crude. So that is the idea. I think refiners will be looking for that.
But as I said, it's not as simple as that. It is going to cause a lot of other headaches. It already has started causing a lot of concern and consternation amongst refiners, because are the banks going to take the risk?
Because as I mentioned earlier, so many sanctioned entities are involved. Even if the buyers can guarantee that the crude they bought was sold below the price cap, there's a whole lot of other sanctioned entities along the way that could cause problems.
Govindraj Ethiraj: Right. So if one were to now look at this in the context of how demand and supply is shaping up in 2025, at least the early part of 2025, what are the trends that you're seeing?
Vandana Hari: Quite interesting, Govind, that the way the year has started off, it's been absolute contrast to what was the overwhelming consensus view pretty much through the fourth quarter of last year. And mind you, that view hasn't changed. So when a lot of analysts said, and ourselves included, that we expect prices in general in 2025 to be softer, Brent average we have forecasted around somewhere in the range of $70 to $75 instead of $79 average of last year, that big picture has not changed.
That stems from concerns that there's going to be a global economic slowdown. And mind you, those concerns have actually intensified in recent weeks. We've seen a lot of risk aversion in the stock markets.
Crude has been insulated from that because partly earlier because of the colder than normal temperatures in the Northern Hemisphere, and then after that because of the sanctions. But that is still our view for 2025, that we're probably going to see a sort of balanced to slightly oversupplied market, which means lower prices on average than what we saw in 2024.
Govindraj Ethiraj: Is there any shifts that you're seeing in the energy mix as such into 2025, any secular shifts, any long-term changes?
Vandana Hari: So on the whole, sort of narrative or theme or ethos seems to be, let's, and this is not recent, but sort of continuing over the past couple of years, that let us be careful in how we transition. This transition itself has to be sustainable. I think in some ways, this is going to be amplified with the Trump and the Republican agenda coming centre stage in Washington, D.C. We already saw the last few weeks, more major Wall Street banks have left the net zero alliance. This idea, which is now, I think, gaining ground even faster that, of course, we need to transition away. We need to decarbonise, but we need to do it carefully. I think on that, probably I will, however, point out that with regards to China, it is a slightly different kettle of fish.
There, the country is increasing the penetration of EVs at a far faster pace than any other country in the world. It's also replacing diesel use in trucks and buses with LNG. So in China, probably we are seeing that quite happen quite fast.
In South Asia, Southeast Asia, we're also seeing governments give a lot more emphasis to biofuels. So all of these and renewables. So I think all of these will continue to happen.
But at the same time, what I would say is a very welcome sign that governments, policymakers, and now financiers of the energy industry and energy industry players themselves are becoming much more cognitive that we need to be very, very careful how quickly we transition and the mode of transition to away from fossil fuels.
Govindraj Ethiraj: Right, Vandana, that's a good note to end on. Thank you so much for joining me.
Vandana Hari: Thank you for having me.
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This segment was supported by India Energy Week 2025 scheduled from February 11-14, 2025, in New Delhi and you can register for the same using the link in the show notes.
Car Sales Are Down
India's car sales by manufacturers to dealers grew 4.2% in 2024, their slowest pace in four years, industry data showed on Tuesday, as demand for new cars cooled off amid high inflation.
Sales of passenger vehicles, which include small cars, sedans and sport utility vehicles (SUV), rose to a record 4.27 million units from January to December last year, compared to 4.11 million units in 2023, according to the Society of Indian Automobile Manufacturers, an industry body, reported by Reuters.
The break up is more revealing.
Sales of small cars dipped 14.4% as most consumers could not afford to put down the base amount for taking loans, as dealers had been telling us in the last six months.
Small cars comprise one-third of total car sales in India, while SUVs and other big cars form the rest.
Sales of SUVs and large cars, on the other hand, grew 16.8% last year, albeit slower than the 22% jump they clocked in 2023.
The last few months have been awash in discounts of several models.
The World’s Busiest Airport
OAG, the leading data platform for the global travel industry, today revealed its 2024 Busiest Airports in the world.
Atlanta Hartsfield-Jackson International Airport (ATL) retains its position as the World’s Busiest Airport with 62.7 million seats. It is followed by Dubai International Airport (DXB) in second place and London Heathrow (LHR) in fourth.
Tokyo Haneda (HND) maintains its position as the 3rd busiest airport worldwide (International and Domestic seat capacity) achieving a 4.8% year-on-year capacity growth, to reach an impressive 55.2 million seats.
Joining HND in the Top Ten are Guangzhou Baiyun (CAN) (7th position) and Shanghai Pudong (PVG) (9th position), which climbed from 15th to 9th place in just one year, driven by a 29% year-on-year capacity growth. This makes it the fastest-growing airport in the global Top 10.
When it comes to international seat capacity Seoul Incheon (ICN) is the highest ranked Asia Pacific airport handling 41.6 million international seats and climbing from 7th place in 2023 to 3rd in 2024.
Singapore Changi (SIN) emerges as a close contender with 41.5M scheduled seats, followed by Hong Kong (HKG) with 34.6M seats, showcasing an impressive 40% year-on-year capacity growth. Both hubs remain powerhouses for connectivity and serve as key transit hubs in the region.
OAG’s Head of Asia Pacific, Mayur Patel commented:
"Our latest rankings confirm the strength of the Asian market recovery through 2024, with Shanghai Pudong the fastest growing amongst the top ten entrants and Guangzhou Baiyun International entering the list for the first time. The strength of hubs like Seoul Incheon, Singapore Changi, and Hong Kong highlights the region’s critical role in global connectivity and catering to evolving traveler demands.”
Who Owns Schwezan Chutney?
Sichuan is a province in Southwestern China, occupying the Sichuan Basin and Tibetan Plateau
Sichuan was earlier known as Schezwan like Mumbai was known as Bombay or such.
So if you add the word chutney to Schezwan, who should the name belong to ?
Well, there is a battle on.
Fast-moving consumer goods (FMCG) giant Dabur is set to issue a response to a notice issued by the Delhi High Court on February 5 in a trademark infringement case concerning its use of the name ‘Schezwan Chutney’ for one of its products, Business Standard is reporting.
The notice, served last week, follows a plea by Tata Consumer-owned Capital Foods, which alleges trademark infringement.
Capital Foods is known for brands like Ching’s Secret and Smith & Jones and has claimed ‘Schezwan Chutney’ is a recognised name associated with the company, supported by significant investments in brand promotion.
The company accused Dabur of misleading customers by using the same brand name and similar packaging for its product. Further, Capital Foods alleged that Dabur is using bold letters to highlight the name while keeping its own name less visible.
Tata Consumer had earlier acquired Capital Foods in January 2024.
Dabur launched the product last year and subsequently approached the Trademarks Registry to seek the cancellation of the “Schezwan Chutney” trademark registration. It argued that the term refers to the type and quality of the product and should not be granted trademark protection. It further claimed that “Schezwan Chutney” is a generic term and cannot be registered as a trademark, the Financial Express reported .
Dabur, a leading player in the industry with renowned brands like Chyawanprash and Real Juices, now faces this legal challenge amid ongoing disputes over the ‘Schezwan Chutney’ trademark.
