MARCH 20249TOP STORIES5G SMARTPHONE SHIPMENTS TO OVERTAKE 4G DEVICES AS ITS ADOPTION INCREASESTATA MOTORS TO DEMERGE INTO TWO INDEPENDENT ENTITIESFifth generation (5G) smartphone shipments are likely to outpace 4G ones this year, with 5G penetration in the volume-heavy budget segment expected to increase triggering a replacement cycle, said a top executive from Korean major Samsung.Aditya Babbar, vice president of MX (mobile experiences) business at Samsung said that the Korean major will be differentiating its products in the budget not only with 5G support but also with India-centric innovations and features.Babbar, who has been newly elevated from senior director at Samsung, said the company has an aggressive target of selling 2 million units of its newly launched Galaxy F15 in the next 12-15 months."The way 2024 is emerging, one of the big demand centers will be 5G. 5G democratisation will take place at a faster pace and that is where you will see a large replacement demand coming from," Babbar said.This might be the first year when 5G in terms of volumes will outgrow 4G," he said, adding that analysts are expecting a 65:35 split between 5G and 4G handsets.To catch on with the trend, and to compete with Chinese rivals such as Vivo and Xiaomi, Samsung introduced a Rs 12,000-priced 5G handset that it claimed trumps competition with a better display, bigger battery, and four years of software updates. Babbar said the combination of the three will give the product an edge over the others."We all agree that 5G is growing. The need for 5G is increasing but the need for only 5G is not increasing. Consumers need a complete phone with a good display, camera, battery, and the other things around it," the executive said at the sidelines of the launch. On Monday, Tata Motors' board gave the green light to a significant restructuring, opting to demerge its operations into two distinct entities: one focusing on commercial vehicles and the other on passenger vehicles. This strategic move aims to capitalize on synergies within each segment and drive accelerated growth.Under the proposed demerger, all shareholders of Tata Motors will maintain their current shareholding in both entities. This decision follows the earlier subsidization of PV and EV businesses in 2022, aligning with the company's strategy to enhance growth prospects and agility while reinforcing accountability.After the demerger, one entity will oversee the commercial vehicles business and associated investments, while the other will manage passenger vehicles, including PVs, electric vehicles, Jaguars, Land Rovers, and related investments. The demerger process will be executed through an NCLT scheme of arrangement, subject to approvals from the Tata Motors board, shareholders, creditors, and regulators, expected to be completed within 12-15 months.Since 2021, Tata Motors' CV, PV, and JLR businesses have operated independently under their respective CEOs. The rationale behind this move lies in the limited synergies between CV and PV businesses, although the company identifies significant synergies across all three, particularly in EVs, autonomous vehicles, and vehicle software.Tata Motors assures stakeholders that the demerger will not adversely affect employees, customers, or business partners. Instead, it aims to streamline operations, foster innovation, and position both entities for sustained growth in their respective markets.
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