2023-11-28 06:44

India's No. 1 e-scooter maker faces challenges ahead of IPO Some service centres have big backlogs, long repair times Ola's CEO says it's aggressively expanding service network THANE/HYDERABAD/NEW DELHI/MUMBAI, Nov 28 (Reuters) - Bhavish Aggarwal, India's answer to Elon Musk, is racing to roll out millions of electric scooters and speed his nation to a cleaner future. Some of his mechanics can't keep up, though. Aggarwal's Ola Electric, which he likens to Tesla in the West, is zipping towards a stock-market listing after going from zero to 338,000 e-scooter sales in about two years. The tech entrepreneur vows to banish the internal combustion engine (ICE) from India, where two-wheel vehicles rule the roads. We will "end the ICE age", the 38-year-old told Reuters ahead of the launch of new Ola e-scooters starting at about $1,000 on Aug. 15, Indian Independence day. He said the company, already valued at $5.4 billion, would quadruple its annual production capacity to 2 million e-scooters by early new year. Yet Ola's rapid ride faces a few potholes. Parts of the company's nationwide network of over 400 service hubs which maintain and repair its EVs are showing signs of strain after the surge in sales, according to Reuters visits to 35 centres in 10 states between July and October, plus interviews with 36 Ola service staff and 40 customers. Staff at more than half of those centres, mainly sites in the big metropolitan areas of Mumbai, Chennai and Bengaluru, said they had significant backlogs, with demand outstripping their workforce or their supply of spare parts, and repair waiting times ranging from three days to two weeks. At an Ola workshop in Thane, among the biggest of the 14 centres in the Mumbai region, more than 100 e-scooters awaiting repairs were visible outside, many parked in a muddy clearing gathering dust and littered with bird droppings. Devendra Ghuge, a Thane service manager, told Reuters in late October that the number of cases the centre dealt with had risen from 200-300 to roughly 1,000 a month over the previous four months, with waiting times stretching up to two weeks. In January, Ola founder and CEO Aggarwal had pledged that customers would be able to bring their vehicles into a hub and receive same-day service in most cases. In the August interview, he said customers were "voting with their wallets every month" by snapping up Ola EVs. But he acknowledged service capacity issues and said Ola was "aggressively" bolstering its service network by adding 100 new centres and hiring more technicians. "We have the highest number of products on the market ... and we do have a scale-up required in our service network," he said. An Ola spokesperson said the Reuters reporting didn't accurately capture the scale and quality of the company's robust and growing service operations. Ravi Bhatia of auto consulting firm JATO Dynamics said a good service network was critical in India, the world's biggest two-wheeler market. Indians are new to tech-packed EVs that can be more sensitive to bumps and bashes than many conventional scooters and motorbikes, he added. India can indeed pose tough driving conditions, and two-wheelers are used by hundreds of millions of people to navigate roads that are often congested and riddled with potholes. Ola needs "to build the infrastructure for service accordingly, otherwise word-of-mouth will bite them," Bhatia said. 'TESLA FOR WEST, OLA FOR REST' Aggarwal often declares, "Tesla is for the West, Ola for the rest", and he's a man in a hurry. He says all new scooters and motorbikes sold in India could be electric by the end of 2025, a goal way ahead of the government's target of 70% of new two-wheeler sales being EVs by 2030. Two years since Ola's first e-scooter rolled off the line, the startup has established itself as the leader in India's two-wheeler EV market, with about a third of sales by volume. It has attracted marquee investors including Japan's SoftBank (9984.T) and Singapore's Temasek and is gearing up for a $700 million Indian IPO. Industry data shows sales of e-scooters nearly tripled to over 700,000 in the year to March versus the previous year, thanks to Ola and also rivals like Hero Electric and TVS Motor (TVSM.NS). Yet those sales were still a fraction of the 5.2 million new scooters and 10.2 million motorbikes sold in India, where EV adoption significantly lags countries like the U.S. and China, and charging infrastructure is in its infancy. HOW TO RIDE E-SCOOTERS Ghuge, the manager at Ola's Thane workshop, said reported service issues included battery drainages, software glitches and damaged wires. He put much of the service surge down to the fact Indians were inexperienced in driving e-scooters on the country's often poorly maintained roads, adding that many vehicles had been damaged after slipping on roads during monsoon season. "Electric vehicles are new to people so they aren't aware of how to ride the vehicle to maximise optimal output," he said. Customer Khubeb Koradia, 25, said the Thane centre took three weeks to fix software-related issues after his EV broke down in September. The workshop "looked like a scooter graveyard" he said, referring to the scores of vehicles parked outside. At the Ola centre in the city of Kochi, service manager Ronald Radhakrishnan told Reuters in August that its 17 staff were "unable to handle demand for repairs". Dozens of vehicles were parked outside the workshop, with some also in an area being used to park scooters across the road. 'GONE THROUGH THE ROOF' Some customers have found it tough to book a repair slot. Koradia shared a video with Reuters showing his attempt to book a slot on Oct. 31 for an e-scooter overheating problem. Seven of the nearest eight service centres to him in Mumbai rejected his request for repairs with the same message: "All slots for this location are full for the next few days." Hundreds of other Ola customers have also complained online about repair times or difficulties in finding servicing slots, according to a review of social media posts. Aggarwal is bullish about his business, though, saying last month his sales had "gone through the roof" in India's festive season, with an e-scooter being sold every 10 seconds. During his Reuters interview, he dismissed much of the online outcry on service issues as "mudslinging" by rivals, without elaborating. "A lot of what you hear and see need not actually be the truth," he said. https://www.reuters.com/business/autos-transportation/tesla-two-wheels-indias-ola-electric-feels-strains-success-2023-11-28/

2023-11-28 06:42

SILKYARA, India, Nov 28 (Reuters) - Rescuers in India are just six or seven metres (20-23 feet) away from 41 men trapped in a collapsed highway tunnel in the Himalayas for more than two weeks, and are confident of drilling through to reach them on Tuesday, officials said. The men, low-wage workers from India's poorest states, have been stuck in the 4.5 km (3 miles) tunnel in Uttarakhand state since it collapsed on Nov. 12. So-called rat miners, brought in on Monday to drill through the rocks and gravel by hand after machinery failed, made good progress overnight, officials said. "About 6 or 7 metres are left," said Deepak Patil, a senior officer leading the rescue, adding that more than 50 metres of an estimated 60 metres of debris had been bored through. "Sure, 100%," he said when asked if the men could be reached on Tuesday. The men have been getting food, water, light, oxygen and medicines through a pipe but efforts to dig a tunnel to reach and rescue them with drilling machines have been frustrated by a series of snags. Rescuers on Monday brought in the "rat miners", experts at a primitive, hazardous and controversial method used mostly to get at coal deposits through narrow passages. Their name comes from their resemblance to burrowing rats. The tunnel is part of the $1.5 billion Char Dham highway, one of Prime Minister Narendra Modi's most ambitious projects, aimed at connecting four Hindu pilgrimage sites through an 890- km network of roads. Authorities have not said what caused the cave-in but the region is prone to landslides, earthquakes and floods. https://www.reuters.com/world/india/indian-rescuers-say-very-close-reaching-41-men-trapped-tunnel-2023-11-28/

2023-11-28 06:20

LONDON, Nov 28 (Reuters) - M&G Real Estate (MNG.L) forecasts it is "a matter of time" before global property markets face greater volumes of forced selling, with banks increasingly reluctant to refinance troubled or lower quality assets at current interest rates. Property developers in China, Germany and Sweden have in particular suffered as a result of a sharp rise in borrowing costs in recent years, with some projects financed at rock-bottom rates now close to, or breaching, key loan terms. "We had it really good in the last 25 years but now financing costs are higher and returns will have to come either from rental growth, or from adding value to properties," Jose Pellicer, head of investment strategy at M&G Real Estate said. "We are in a new period of real estate investment that will require a new mindset," he told Reuters before the publication of the firm's Global Real Estate Outlook on Tuesday. Pellicer said a recovery in the Chinese market would likely take time, although its troubles were cyclical rather than structural and key growth drivers like urbanisation were intact. In Europe, Germany would likely see the largest volume of forced property sales, Pellicer predicted, with the market reeling more than others from higher costs of real estate debt and a sharp repricing of assets. Nearly 40% of outstanding British commercial real estate loans are due to mature in 2024 and 2025, where average real estate values have fallen by over 20% since mid-2022, the report said, citing data from Bayes Business School. Some borrowers would be unable "to meet interest coverage ratio covenants for loan renewals" and may have difficulty finding refinancing options open to them. M&G, which manages 31 billion pounds ($39 billion) in property assets, said this might provide an opportunity for alternative lenders to step in. "Real estate debt is becoming an increasingly attractive investment proposition," Pellicer said. OFFICE WOES The global office market has been rattled by the bankruptcy of WeWork, darkening the outlook for the largest business hubs, where rising vacancies are already hitting investors. But not all offices are equal, Pellicer said. Low-quality offices are a risky investment globally, as employees remain slow to abandon home working after the COVID-19 pandemic and buildings face costly upgrades to meet sustainability targets, the report showed. The United States is in a far worse position than Asia or Europe, with downtown vacancy rates in key cities typically between 25-30% versus single digits in major European business hubs, Pellicer said. U.S. office-based working is at only 50% of pre-pandemic levels, the report cited real estate services firm JLL (JLL.N) as estimating, while numbers in Europe have recovered to 75%. M&G said a focus on environmental, social and governance credentials and central locations was creating a market of prime, ultra-prime, and secondary space, with non-prime properties facing "significant leasing risk and weak rental prospects". ($1 = 0.8025 pounds) https://www.reuters.com/markets/forced-sales-ahead-indebted-global-real-estate-markets-mg-2023-11-28/

2023-11-28 06:19

Nov 28 (Reuters) - It's next-level stuff. "Layer 2" cryptocurrencies native to projects built on top of "layer 1" blockchains such as Bitcoin and Ethereum - have found a new lease of life after a year in the doldrums, buoyed by a rising crypto tide. Anticipation of easing U.S. borrowing costs and a possible U.S. spot bitcoin exchange-traded fund have lifted crypto prices since the summer, with market bitcoin gaining by about half since the end of August. Tokens associated with layer 2 projects - which typically aim to speed up transactions and cut costs - have a combined market cap of about $14.3 billion, about a tenth of the total crypto market, according to data from CoinMaketCap.com. Matic , the largest layer 2 token with a market cap of $6.90 billion, has jumped 20% to $0.74 over the past 30 days, according to CoinGecko. It's used on Polygon, a platform that reduces congestion on the Ethereum network. The next four largest coins - immutable, mantle, arbitrum and optimism - have leapt between 9% and 105% over the past month and trade between $0.5 to under $2 apiece. All five tokens are down between 16% and 86% from their all-time highs hit over the past two years, though. Ether , the layer 1 token linked to the Ethereum blockchain on which most layer 2 tokens are based, has leapt 13.8% to $2,028.80 in the past month. Layer 2 tokens, which have proliferated in recent years, can be a risky business. They are small and thinly traded, meaning they can be highly volatile and unpredictable. Picking long-term winners is tough. "On average, the growth is not sustainable for those tokens ... 100 try and one wins," said Matteo Greco, research analyst at digital asset and fintech investment firm Fineqia International (FNQ.CD). "There's always a bit of thin air behind the moves." Price performance is also patchy. Matic has fallen about 3% in 2023, while gaming token immutable has more than tripled in price, versus bitcoin's 123% and ether's 69% gains. SPECULATIVE CHARACTER Layer 2 tokens are a gauge of sentiment towards the projects they are linked to, but their extreme volatility also lends them a speculative character. They are often among the last ones to catch a bid when broader crypto market rises and among the first ones to sell off when sentiment is shaken. While layer 2 tokens are tiny in comparison to big guns like bitcoin, their volatility makes them a favorite among active traders trying to capitalize on market momentum. "They can be very attractive investments even though they can be very speculative," said Joshua Peck, chief investment officer at hedge fund TrueCode Capital, whose fund invests in matic. "For a token that's down 97%, it doesn't take a lot of capital inflow for it to go three times, four times, five times in price." "Active trading is the right approach for these tokens because the market is moving so much," Peck added. The future of layer 2 tokens is unclear. Some analysts see the projects as vital to increasing the practical uses of blockchains like Ethereum, in areas such as finance to gaming. Yet the market is crowded. Numerous projects and their tokens were launched as the crypto market boomed in 2020, before sinking during the crypto winter of 2022. "The space feels 'unserious' right now ... in terms of being able to point to an example of something you'd like to run your business or family's personal finances on," said Alyse Killeen, managing partner at venture capital firm Stillmark. Many investors agree that only projects with useful practical applications will survive. "In these macro phases, the use cases are not really so important. The real difference between assets that have decent use cases and assets that don't is (in) the bear market," said Fineqia International's Greco. "Assets that have good use cases are able to resist the downtrend even though they get hit hard." https://www.reuters.com/technology/cryptoverse-layer-two-tokens-enjoy-new-life-bitcoin-soars-2023-11-28/

2023-11-28 06:10

A look at the day ahead in European and global markets from Ankur Banerjee Asian markets kept up their November rally and the dollar dipped to three-month low, but big-name fast-fashion company Shein stole the market spotlight with an IPO filing that will likely test investor appetite for new listings. Shein, known for its $10 tops and $5 biker shorts, filed confidentially for a U.S. IPO, sources told Reuters, with the China-founded and Singapore-based firm expected to go public sometime next year. Whether this potential blockbuster gives a fillip to the lacklustre IPO market remains to be seen, after some high-profile public debuts this year failed to impress. On a macro level, the theme remains the same: Traders are getting fidgety about whether the Fed is well and truly done with interest rate hikes, and when it is likely to start cutting rates - presumably next year. The Fed's focus on beating inflation means Thursday's core personal consumption expenditures data, the central bank's preferred measure of inflation, will be the main event this week, with investors hesitant to place major bets and keeping share markets within a narrow range. Risk appetite got a boost this month after data releases that hinted at easing inflation, stoking expectations that central banks had reached their interest rate peaks. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) is on course for its strongest monthly performance since January with a nearly 7% gain. Japan's Nikkei, Asia's best-performing stock market this year, is set for its strongest monthly result in three years. European stock markets are likely to see a subdued start to Tuesday, futures indicate, with a bare economic calendar leaving investors treading cautiously ahead of major economic data. Meanwhile, British shopper numbers and transactions on Black Friday were lower than last year's, disappointing retailers looking for a pick-up in spending after a subdued October. In contrast, U.S. spending online on Cyber Monday is set to exceed $12 billion, a record, according to preliminary estimates from Adobe Digital Insights, with price-conscious consumers favouring buy-now pay-later services to ease stress on their wallets. Key developments that could influence markets on Tuesday: France consumer confidence for November, Euro zone money M3 annual growth for October. https://www.reuters.com/markets/europe/global-markets-view-europe-2023-11-28/

2023-11-28 05:43

OPEC+ meets on Thursday to set policy Output from largest Kazakh oilfields down 56% Fed's Waller flags rate-cut possibility in months ahead US crude inventories expected to have fallen last week -poll Coming up: API supply report at 2130 GMT NEW YORK, Nov 28 (Reuters) - Oil prices jumped on Tuesday, settling up about 2% on the possibility OPEC+ will extend or deepen supply cuts, a storm-related drop in Kazakh oil output and a weaker U.S. dollar. Brent crude futures settled up $1.70, or 2.1%, at $81.68 a barrel. U.S. West Texas Intermediate (WTI) crude gained $1.55, or 2.1%, to settle at $76.41. OPEC+, the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, is due to hold an online ministerial meeting on Thursday to discuss 2024 production targets. The talks will be difficult and a rollover of the previous agreement is possible rather than deeper production cuts, four OPEC+ sources said. The market tumbled last week when OPEC+ pushed back the original date for its meeting to iron out differences on production targets for African producers. "We believe the market's primary focus surrounds the continuation of Saudi Arabia's additional voluntary cuts of 1 million barrels per day," Walt Chancellor, an energy strategist at Macquarie, said in a note. "We believe an extension of these cuts into Q2/Q3 2024 may represent the threshold for this meeting being viewed bullishly." One possible compromise could involve Angola and Nigeria accepting reduced production targets for a few months if targets for the other countries were likewise lowered, said Commerzbank's Carsten Fritsch. "According to delegates, Saudi Arabia is demanding lower production quotas from the other OPEC+ countries. While Kuwait has signaled that it would be willing to do so, some countries are apparently resisting any such move." The United Arab Emirates is likely to oppose this, given that its 2024 production target was increased at its urging when OPEC+ held its previous meeting in early June, he added. Oil also found support from a weak dollar, an expected decline in U.S. crude inventories and the drop in Kazakh output. Kazakhstan's largest oilfields have cut their combined daily oil output by 56%. Four analysts polled by Reuters estimated that the latest round of weekly U.S. supply reports will show crude inventories fell by about 900,000 barrels. The first of this week's two reports is due at 2130 GMT from the American Petroleum Institute. The U.S. dollar sank to a three-month low on Tuesday after U.S. Federal Reserve Governor Christopher Waller flagged the possibility of lowering the Fed policy rate in the months ahead if inflation declines further. A weaker dollar typically bolsters oil demand, making dollar-denominated oil less expensive for buyers using other currencies. In the Middle East, Israeli forces and Hamas fighters held their fire beyond the original deadline of a truce, extended at the last minute by at least two days to let more hostages go free. https://www.reuters.com/business/energy/oil-track-snap-losing-streak-hopes-further-opec-cuts-2023-11-28/