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Good morning.  In today’s news: what greatness will Donald Trump’s presidency bring to America? Maruti Suzuki investors are happy about its electric vehicle (EV) bet; and foreign portfolio investor (FPI) sell-offs continue. 

THE TAKE

What Greatness Will Donald Trump Bring To America, And Its Ties With India?

Donald Trump’s victory was not a surprise.

And its core campaign proposition, including on all the red hats, was to make America great again. 

Many non-Americans and Americans associate the term greatness with economic achievement, prosperity, well-paying jobs, success and the American dream. 

For Trump, then and now, greatness has not been so much economic as it has been social. 

At a victory speech delivered on Wednesday morning India time in Florida, the issue he first touched upon was immigration. 

Not surprisingly, since the issue of illegal immigration figured prominently in the campaign trail and was amplified by Elon Musk and his social platform, X. Whether or not the Democrats under Joe Biden did anything in the context of immigration isn’t relevant here as Trump has owned this issue since 2016.

America Was Already Great

The Economist argued a week ago that a country like the United States, with a per capita income of $85,000 per annum, does not need to be made great, it is already great. If greatness were to be defined by economic value, that is absolutely true — a reminder India has a per capita income of $2,500 per annum though on purchasing power parity things might look better. 

The Wall Street Journal pointed out last week that the US was now outrunning every major developed economy, not to mention its own historical growth rate.

More impressive than the rate of growth is its quality because it did not come from inflation-inducing squeeze on labour and other resources but rather from making people and businesses more productive, the Wall Street Journal highlighted.

The only economic factor that clearly weighed on many Americans was inflation which has been running high and hitting items of daily consumption, apart from other non-discretionary items. 

While inflation could have played a strong role, it is also more of a post-Covid phenomenon and was not really an issue in Trump’s earlier messaging in the run-up to his previous stint.

The question then is how does the term greatness resonate with young voters, new voters and the rest including disaffected young males who voted for Trump, whether from his traditional base or otherwise.

What’s Trump’s Positioning? 

For Trump’s campaign positioning then and now, “greatness” meant going back to a pre-existing situation rather than looking forward. The slogan says it all: ‘Make America Great Again’. 

The word ‘again’ refers to a point in the past where things were great. 

Is that greatness economic and thus prosperity, pride, joy, low inflationary environment or something else? Or is it the altering structure of the populace thanks to heightened immigration, including illegal which has clearly riled up many people, including Trump and his key allies?

What does Trump’s victory mean to us in India then? 

Partly it will include the old — a time when immigrating to the US was tough, where only the best and brightest as we know could make it there. 

These are the immigrants, Trump and Musk — it might be easier to think of them jointly for some time — want. 

The new part would be tariffs, including bringing manufacturing back, putting America First and thus creating more local jobs. This was a stated objective in Trump’s 2016 campaign rallies and continues to be so, with the added factor and threat of slapping high import tariffs on China and lower tariffs on other countries.

This was also the area where Trump linked clearly with now vice president JD Vance. Vance’s book Hillybilly Elegy, written in June 2016, highlighted the plight of mostly white American communities that experienced job losses and social tensions, particularly in the midwest part of the country.

It is not clear where Musk fits into this puzzle. Remember the largest Tesla factory sits in Shanghai, China and not in the US which has the second largest factory, followed by Germany. While these factories manufacture for domestic markets and do not seem to be exporting back to America, there is an interconnectedness that is tough to break.

India is on a different economic spectrum. For India, greatness can only mean higher prosperity and growth. This is mathematical and not political, given our current per capita GDP and the fact that we have hundreds of millions of aspirations that need to be fulfilled.

It is tempting to revert to a bygone era or some period where things were better than they are today. Politicians will always attempt this, possibly even with some success. But India’s aspirations will largely be and should be economic, greatness linked to prosperity, better quality of life, education for children and a roof over the head that you can call your own.

Greatness as a societal value linked to families, relationships and social capital is something India always had in abundance.

CO:RELATION

Is The Sleeping Giant Waking Up? 

The share price of Maruti Suzuki, the most prominent car maker in India by volume, has barely moved over the past year. The company's sales and profit growth slowed in the first two quarters of 2024-25. However, the profit margins are better than last year's. The automaker’s shares have underperformed like its peers such as Tata Motors, Mahindra & Mahindra, and the Nifty Auto index. However, investors responded positively to the announcement of Maruti's plans to roll out their first electric vehicle (electric vehicle) in Gujarat by 2025. 

Investors are looking at Suzuki's EV strategy to positively roll out models in Japan, India and other countries. The company told analysts last week that it is also looking at India as a manufacturing hub for the world. Maruti Suzuki has the most extensive distribution and service network in India and plans to launch compact electric vehicles for the Indian market. While Suzuki embarks on the EV journey, investors hope the flagship retail segment picks up. However, the company has flagged an affordability challenge with incomes not rising sufficiently and input costs increasing. Maruti has managed to stem the fall by launching limited edition models.

CORE NUMBER

Rs 1.21 lakh crore

This is the total value of withdrawals made by FPIs, who continued their selling streak for the 27th consecutive session on Tuesday, withdrawing an additional Rs 2,569 crore from Indian equity markets  Throughout October, FPIs remained net sellers, offloading Rs 1.14 lakh crore worth of Indian stocks. According to Mint, this trend extended into November, with an additional Rs 7,111 crore withdrawn. Although FPIs were, in fact, net sellers in October, they also actively invested Rs 20,000 crore in the primary markets during the same month.  Experts attribute this sell-off to less favourable global and domestic conditions, overblown valuations in Indian equities, and a rebound in Chinese stock markets.

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FROM THE PERIPHERY

—🚙 The festive season ensured a 32% increase in retail car sales in India, but inventory levels have continued to remain high, according to the Federation of Automobile Dealers Association (FADA). Data showed that sports utility vehicles (SUVs) saw the highest demand in retail sales. The Economic Times reported that wholesales or sales by automakers to dealers continued to remain flat or were lower in some cases. When compared year-on-year, retail car sales stood at 4,83,159 units in October compared to 3,64,991 units in October 2023. But this was also the festive season that began early in October rather than last year’s mid-October. While carmakers have blamed rains and extreme weather situations for this, consistent slowdown in sales, and not just in the auto sector, indicates a bigger problem of a growth slowdown of the Indian economy.  

—⁉️ Speak of slowdown, amid several clear indicators, the governor of India’s central bank the Reserve Bank of India (RBI) said on Wednesday that inflation was a worry for the country. Shaktikanta Das, however, stopped short of saying that there was an actual slowdown. Business Standard quoted Das as saying, “I would not rush to declare that the economy is slowing down. Data which is coming in is mixed, but the positives outweigh the negatives. By and large, underlying economic activity remains strong.” Even though recent sales and data have said otherwise, Das said he was confident about the Indian economy. 

—💲 Swiggy's IPO saw a 12% subscription rate on its first day of bidding. Retail buyers booked 54% of the issue, and employees subscribed 0.74 times. However, non-institutional investors (NIIs) showed low demand, but they are expected to pick up more subscriptions on days 2 and 3 of the bidding.  Swiggy's shares opened for public subscription in the price band of Rs 371 to Rs 390. The food delivery giant has already raised Rs 5,085.02 crore from domestic and international anchor investors on November 5. The food and grocery delivery giant is looking to raise Rs 11,327.43 crore in total via the IPO.

—🚗 German luxury carmaker BMW's net profit declined by a worrying 84% in the July-to-September quarter, reaching $512 million, worse than analyst estimates.  The automobile maker attributed the decline to slumping Chinese sales, where the manufacturer had come to rely heavily on China, making around a third of its sales there. Apart from this, issues with its vehicles' braking system resulted in a recall affecting 1.5 million cars. Overall, BMW's sales declined by nearly 16% year-on-year, and the company faces multiple challenges in the global auto market, news agency AFP reported.

UGHH

🚩 Several tech startups in India have been engaging in negative campaigns against rival brands, paying influencers or collaborating with key industry leaders on social media sites. Mint reported quoting experts that such campaigns can take various forms, although most of them are done through paid social media posts. This includes highlighting a rival's flaws by bringing out its financial or growth vulnerabilities. The report also added that ASCI guidelines do not permit such discrediting of rival brands through unfair and negative campaigns. Legal experts believe that although brands can pursue cases against such bad actors, they rarely do so to reduce financial expenses amidst large events like Initial Public Offerings.

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