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China is experiencing a surge in Human Metapneumovirus (HMPV) infections after five years of the Covid-19 pandemic. Reports and online posts indicate widespread transmission, with some claiming hospitals and crematories are overwhelmed. Videos circulating online depict crowded hospitals, and users mention the simultaneous circulation of influenza A, HMPV, Mycoplasma pneumoniae, and Covid-19. Some reports link the rise in HMPV to an increase in deaths, particularly among people aged 40 to 80.
"China is facing a surge in multiple viruses, including Influenza A, HMPV, Mycoplasma pneumon
iae, and Covid-19, overwhelming hospitals and crematoriums. Children's hospitals are particularly strained by rising pneumonia and 'white lung' cases," a social media post stated.
The Chinese CDC reportedly said that there is an increase in HMPV positive cases among those aged 14 and under.
Some users also alleged a rapid spread of "multiple viruses" including influenza A, HMPV, Mycoplasma pneumoniae, and COVID-19. One user even claimed China declared a state of emergency.These claims are, however, unsupported and there is no concrete evidence to support the claims. Neither Chinese health officials nor the World Health Organization (WHO) have confirmed an epidemic or state of emergency.
Symptoms include cough, fever, nasal congestion, and shortness of breath. Transmission occurs through respiratory droplets and contact with contaminated objects. The incubation period is three to five days. Preventive measures include wearing masks, frequent handwashing, and boosting immunity. Experts advise against using antivirals for HMPV. A Shanghai respiratory expert warned against using antiviral drugs for HMPV, stating it has no vaccine and symptoms similar to a cold. In 2023, HMPV was detected in several countries, including the Netherlands, Britain, Finland, Australia, Canada, the US, and China.
Germany launched a digital Consular Services Portal for visa applications. This new system covers 28 types of national visas, making the process faster and easier. Purpose is to attract skilled workers. Foreign Minister Annalena Baerbock emphasized its importance for addressing the skilled worker shortage. Businesses will benefit from reduced waiting times for appointments.
Three places in the United States- New Orleans, New York and Las Vegas reported three massive incidents in the past 24 hours. In New Orleans, at least 15 people were killed and dozens suffered injuries after a pickup truck ploughed into a crowd in the southern US city of New Orleans on New Year's Day. The driver of the truck also fired at the crowd and exchanged gunfire with the police.
A shooting at the Amazura event hall in Jamaica, Queens, late Wednesday night left at least 11 people injured, according to law enforcement officials. On the other hand, one person was killed and seven were wounded when a Tesla Cybertruck exploded outside a hotel belonging to US President-elect Donald Trump in Las Vegas, police said Wednesday.
These three incidents happened when people were celebrating New Year's Day. Here are 10 things you need to know about US incidents that happened in the past 24 hours:
New Orleans crash
-In New Orleans, authorities said driver of a pickup truck sped through a crowd of pedestrians gathered in New Orleans’ bustling French Quarter district. At least 15 people were killed and many suffered injuries.
The suspect, who has since been killed in a police shootout, has been identified as Shamsud-Din Jabbar, a US citizen from the state of Texas.
-The Army veteran who rammed a pickup into New Year’s revelers on Bourbon Street was “inspired by” the Islamic State terrorist organization, President Biden said Wednesday night in a short address from Camp David, reported New York Times.
-Authorities also found potential explosive devices in the French Quarter, the FBI said. Surveillance footage showed three men and a woman placing one of multiple improvised explosive devices, according to a Louisiana State Police intelligence bulletin obtained by The Associated Press.
-The suspect had “pledged allegiance to ISIS” in several videos posted to his Facebook page the night before the attack, according to a law enforcement official who spoke on condition of anonymity, reported NYT. Court records show Jabbar faced a deteriorating financial situation in 2022 while separating from his then-wife.
Las Vegas Explosion
-A Tesla Cybertruck filled with fuel canisters and firework mortars exploded outside the Trump Hotel in Las Vegas, Nevada. The driver was killed and seven people were injured, police said without naming any individuals.
-Footage showed the truck parked directly in front of the entrance of the hotel. The truck sits idle for several seconds before exploding - bursts of multi-coloured fireworks shooting in multiple directions.
-Another video showed investigators using a black fire-retardant tarp to put out the blaze and the charred remains of the truck bed. An array of gas and fuel canisters were left behind along with the remnants of more than a dozen firework mortars, according to BBC.
-Tesla CEO Elon Musk said that the explosion in Las Vegas appears to be an act of terrorism. He also said that the terrorists chose wrong vehicle for the attack as it contained the explosion and directed the blast upwards.
-According to US officials, the explosives contained in the Cybertruck were fireworks, gas tanks and camping fuel, which were connected to a detonation system controlled by the driver, reported TOI.
New York shooting
-At least 10 people have been injured in a mass shooting outside a nightclub in New York's Queens on Wednesday night. The shooting reportedly took place around 11:20 pm near the Amazura nightclub.
-The Amazura club, which regularly features DJs and live performances, had reportedly hosted a private party in honour of a known gang member - who died last year. There were around 80 people gathered outside the nightclub waiting to get inside when the incident took reported AMNY news.
-Footage shared on Citizen App showed a large police and ambulance presence outside the club. Amazura, known for its spacious interior that can accommodate up to 4,000 people, frequently hosts DJs and live events.
Authorities revealed that at least three victims managed to walk into a local hospital seeking medical attention, while others were rushed to nearby medical facilities. The police have not yet disclosed the motive behind the shooting or identified any suspects.
-The mass shooting coincides with a deadly attack in New Orleans on New Year's Day and a Tesla Cybertruck exploding outside Trump's Las Vegas Hotel. These incidents add to rising concern over violent attacks or doubted terrorist attacks in the US as authorities continue to investigate the motives behind these tragedies.
India’s telecom sector is the second largest globally, boasting over 1.19 billion subscribers as of September 2024. With a staggering teledensity of 85.69%, it supports a robust digital economy and contributes approximately ₹3.36 trillion (US$40 billion) in revenue for the fiscal year 2024.
With a market capitalization of Rs 55,620.45 crore, the shares of Vodafone Idea Ltd were trading at Rs 7.98 per share, increasing around 0.50 percent as compared to the previous closing price of Rs 7.94 apiece.
Brokerage recommendation:-
Citi Research, one of the well-known brokerages globally, gave a ‘Buy’ call on the telecom stock with a target price of Rs 13 apiece, indicating a potential upside of 68 percent from Wednesday’s price of Rs 7.63 per share.
Target Rational:-
According to the brokerage, the telecom department has exempted the obligation to submit a bank guarantee for spectrum auctions performed previous to the reform package, claiming that the latest “relief” will stimulate 4G and 5G investments in India.
Furthermore, previous to this reform, VIL was obliged to give bank guarantees totaling around Rs 24,800 crore against each spectrum payment 13 months before the installment was due for the aforementioned auctions, according to a BSE filing.
Additionally, the government’s bank guarantee waiver is a significant relief to Vodafone Idea, which was unable to furnish the guarantees. They also hampered efforts to get loan capital, according to the brokerage.
Financial performance:-
Examine the company’s financial condition, revenue jumped by 10 percent from Rs 10,716 crore in Q2FY24 to Rs 10,932 crore in Q2FY25, and during the same time frame, net loss shrunk from Rs 8,738 crore to Rs 7,176 crore..
Strategic Initiatives:-
The company is making significant capex investments, with ₹13.6 billion spent in Q2FY25 and a projected ₹80 billion for H2FY25. Key initiatives include increasing 4G data capacity by 14%, adding 42,000 4G sites, and enhancing network speeds by 18%, improving coverage and indoor experience.
Market Initiatives:-
Recent tariff hikes boosted ARPU and revenue growth, with customer ARPU ex-M2M rising 7.8% QoQ. Despite losing 5.1 million subscribers due to increased port-outs to a competitor not raising tariffs, the company continued growing its postpaid segment with feature-rich offerings. A merger is underway.
Management comments:-
Management is optimistic about the company’s transformation and its competitive positioning in the market. They are confident in leveraging investments to drive improved performance and growth, particularly in the telecom sector, ensuring a strong future outlook and enhanced market presence.
Company snapshot:-
Vodafone Idea Limited provides pan-India voice and data services across second-generation (2G), third-generation (3G) and fourth-generation (4G) platforms. Its Vodafone Idea business services provide communication solutions to global and Indian corporations, public sector and government bodies, small and medium enterprises, and start-ups.
Vodafone Idea (Vi) is expected to launch 5G mobile broadband service in March with aggressively priced plans, aiming to win back customers from Reliance Jio and Bharti Airtel, which already boast nationwide 5G networks.
Vi is likely to initially launch 5G in India’s top 75-odd cities across its 17 priority circles and even target industrial hubs that are heavy data-guzzling zones, multiple people aware of the matter said.
Plans may be up to 15% cheaper at entry levels — at a sharp discount to current offerings by Jio and Airtel — and are seen triggering a price war, leading telco broadband tariff trackers said.
“We are gearing up to launch 5G services and are committed to providing the best experience and price,” a Vi spokesperson told ET. The company would be able to further enhance its 4G coverage and introduce 5G in key cities at the earliest as it holds sufficient and competitive 5G spectrum in its 17 priority markets, the spokesperson said.
“Over the next few months, Vi may also play with distribution costs,” a top sector analyst said.
“Telco may increase its payouts towards dealer commissions and promotional spends to lure back high-value 5G prepaid users from its bigger rivals,” the analyst said. To ET’s specific queries on the prospects of discounted 5G plans and higher spends on dealer commissions, Vi did not comment.
As per Jefferies, Vi spent around `3,583 crore (or 8.4% of sales) in FY24 towards dealer commissions. It was much higher than Jio’s `3,000-crore dealer commissions payout at 3% of sales in FY24, as per the global brokerage’s calculations. Airtel, though, was the biggest such spender in FY24, shelling out around `6,000 crore (or 4% of sales) towards dealer commissions to maintain leadership on the ARPU front.During the last tariff hikes of July 2024, Jio and Airtel had cranked up the minimum threshold for anyone wanting to avail of their 5G mobile broadband services by compelling them to upgrade to higher value base plans in a clear bid to kick off monetisation of the next-generation mobile broadband service.
Vi CEO Akshaya Moondra had signalled the telco may keep its 5G base pricing lower than its bigger rivals. A final call on 5G pricing would be taken closer to launch, he had said at the firm’s earnings call for the first quarter of FY25. Vi needs to quickly ramp up 4G coverage and launch 5G services in its priority markets to halt customer losses and effectively fight Jio and Airtel.
USER EXPERIENCE KEY
Vinish Bawa, partner and telecom leader at PwC India, believes the upcoming battle for 5G customers and revenue share will be fought on pricing, but will also hinge on the quality of the overall mobile broadband experience. “5G penetration has already increased a lot, and we will see 5G launches from another operator (read: Vi) soon. Subscribers will have more choice, and so it will be all about offering an enhanced customer experience on a reliable network with cheaper, innovative pricing plans that will ultimately decide the way subscribers move and define market shares once there are three private 5G operators in India,” he told ET.
Jio and Airtel had 148 million and 105 million pure 5G users, respectively, as of September end.
Another analyst, who did not wish to be named, however, said Vi may not go overboard in undercutting Jio and Airtel on the 5G front as this could stifle ARPU growth, increasing the debt-laden telco’s financial challenges.
But Vi is now backed by a `24,000-crore equity funding and would expect to raise another `25,000 crore in debt after the government’s recent waiver of the bank guarantee requirement. And, most say, it has no choice but to do what it takes to first stop user losses, and then regain some of its lost subscribers with aggressive 4G and 5G play.
4G EXPANSION
Vi recently closed $3.6-billion (`30,000 crore) worth of deals with global network vendors Nokia, Ericsson and Samsung and is expected to step on the gas to expand 4G coverage and roll out 5G. Gear supplies are underway and Vi is rapidly deploying 5G base stations, targeting around 75,000 5G sites in three years, industry executives aware of its plans said.
We’re excited to supercharge our network and add several thousand new sites by March 2025 for enhanced connectivity and roll out 5G to revolutionise the digital experience for Vi users,” the Vi spokesperson said.
People familiar with Vi’s ongoing network expansion plans said the telco will use a mix of 3.5 GHz (C-band) and 1,800 MHz spectrum for its initial 5G rollouts
Income Tax Rebate: "The updated utilities for ITR forms 2 and 3 giving effect to the Circular No. 21 dated 31st December 2024 and including the option to update 87A rebate will be made available shortly," said the Income Tax Department. This means you can soon expect to file a revised ITR or belated ITR to claim 87A tax rebate if eligible. By claiming 87A tax rebate, your total tax liability gets reduced and in some cases it gets nil.
Russian natural gas exports via Ukraine to several European countries have been halted after Kyiv refused to renew a transit deal that expired on Wednesday.
Ukraine had warned that it would not renew the five-year transit deal amid the ongoing military conflict with Russia.
The compound annual growth rate is the rate of return that an investment would need to have every year in order to grow from its beginning balance to its ending balance, over a given time interval. The CAGR assumes that any profits were reinvested at the end of each period of the investment’s life span.
Key Takeaways
The compounded annual growth rate (CAGR) is one of the most accurate ways to calculate and determine returns for anything that can rise or fall in value over time.
It measures a smoothed rate of return.
Investors can compare the CAGR of two or more alternatives to evaluate how well one stock performed against other stocks in a peer group or a market index.
CAGR is thus a good way to evaluate how different investments have performed over time, or against a benchmark.
The CAGR does not, however, reflect investment risk.
Investopedia / Alex Dos Diaz
How to Calculate Compound Annual Growth Rate (CAGR)
CAGR=((
BVEV
)
n1
−1)×100
where:EV=Ending valueBV=Beginning valuen=Number of years
To calculate the CAGR of an investment:
Divide the value of an investment at the end of the period by its value at the beginning of that period.
Raise the result to an exponent of one divided by the number of years.
Subtract one from the subsequent result.
Multiply by 100 to convert the answer into a percentage.
The CAGR formula gives an annualized rate of return, which is useful for comparing the performance of different investments over time.
What the CAGR Can Tell You
The compound annual growth rate isn’t a true return rate, but rather a representational figure. It is essentially a number that describes the rate at which an investment would have grown if it had grown at the same rate every year and the profits were reinvested at the end of each year. For stock market investors, this can be particularly useful in comparing the performance of different stocks. The CAGR does not take into account the discount rate, which is critical in assessing the present value of future returns.
In reality, this sort of performance is unlikely. However, the CAGR can be used to smooth returns so that they may be more easily understood and compared to alternative methods.
Example of How to Use CAGR
Imagine you invested $10,000 in a portfolio with the returns outlined below:
From Jan. 1, 2018, to Jan. 1, 2019, your portfolio grew to $13,000 (or 30% in year one).
On Jan. 1, 2020, the portfolio was $14,000 (or 7.69% from January 2019 to January 2020).
On Jan. 1, 2021, the portfolio ended with $19,000 (or 35.71% from January 2020 to January 2021).
We can see that on an annual basis, the year-to-year growth rates of the investment portfolio were quite different as shown in the parentheses.
On the other hand, the compound annual growth rate smooths the investment’s performance and ignores the fact that 2018 and 2020 were vastly different from 2019. The CAGR over that period was 23.86% and can be calculated as follows:
CAGR=(
$10,000$19,000
)
31
−1×100=23.86%
The CAGR of 23.86% over the three-year investment period can help an investor compare alternatives for their capital or make forecasts of future values. For example, imagine an investor is comparing the performance of two uncorrelated investments.
In any given year during the period, one investment may be rising while the other falls. This could be the case when comparing high-yield bonds to stocks, or a real estate investment to emerging markets. Using CAGR would smooth the annual return over the period so the two alternatives would be easier to compare.
As another example, let’s say an investor bought 55 shares of Amazon.com (AMZN) stock in December 2017 at $1,180 per share, for a total investment of $64,900. After three years, in December 2020, the stock has risen to $3,200 per share, and the investor’s investment is now worth $176,000.
1
What is the CAGR?
Using the CAGR formula, we know that we need the:
Ending Balance: $176,000
Beginning Balance: $64,900
Number of Years: 3
So to calculate the CAGR for this simple example, we would enter that data into the formula as follows: [($176,000 / $64,900) ^ (1/3)] - 1 = 39.5%.
Additional CAGR Uses
The CAGR can be used to calculate the average growth of a single investment. As we saw in our example above, due to market volatility, the year-to-year growth of an investment will likely appear erratic and uneven.
For example, an investment may increase in value by 8% in one year, decrease in value by -2% the following year, and increase in value by 5% in the next. CAGR helps smooth returns when growth rates are expected to be volatile and inconsistent.
Comparing Investments
The CAGR produces a geometric mean which can be used to compare different investment types with one another. For example, suppose that in 2015, an investor placed $10,000 into an account for five years with a fixed annual interest rate of 1% and another $10,000 into a stock mutual fund. The rate of return in the stock fund will be uneven over the next few years, so a comparison between the two investments would be difficult.
Assume that at the end of the five-year period, the savings account’s balance is $10,510.10 and, although the other investment has grown unevenly, the ending balance in the stock fund was $15,348.52. Using the CAGR to compare the two investments can help an investor understand the difference in returns:
Savings Account CAGR=(
$10,000$10,510.10
)
51
−1×100=1.00%
And:
Stock fund CAGR=(
$10,000$15,348.52
)
51
−1×100=8.95%
On the surface, the stock fund may look like a better investment, with nearly nine times the return of the savings account. On the other hand, one of the drawbacks of the CAGR is that by smoothing the returns, the CAGR cannot tell an investor how volatile or risky the stock fund was. However, the CAGR can be used in the MAR ratio, which adjusts for risk. Using the CAGR alongside metrics like net present value (NPV) provides a more comprehensive view of an investment’s potential.
Track Performance
The CAGR can also be used to track the performance of various business measures of one or multiple companies alongside one another. For example, over a five-year period, Big-Sale Stores’ market share CAGR was 1.82%, but its customer satisfaction CAGR over the same period was -0.58%. In this way, comparing the CAGRs of measures within a company reveals strengths and weaknesses.
Detect Weaknesses and Strengths
Comparing the CAGRs of business activities across similar companies will help evaluate competitive weaknesses and strengths. For example, Big-Sale’s customer satisfaction CAGR might not seem so low compared with SuperFast Cable’s customer satisfaction CAGR of -6.31% during the same period.
How Investors Use the CAGR
Understanding the formula used to calculate CAGR is an introduction to many other ways that investors evaluate past returns or estimate future profits. The formula can be manipulated algebraically into a formula to find the present value or future value of money, or to calculate a hurdle rate of return.
For example, imagine that an investor knows that they need $50,000 for a child’s college education in 18 years and they have $15,000 to invest today. How much does the average rate of return need to be to reach that objective? The CAGR calculation can be used to find the answer to this question as follows:
Required Return=(
$15,000$50,000
)
181
−1×100=6.90%
This version of the CAGR formula is just a rearranged present value and future value equation. For example, if an investor knew that they needed $50,000 and they felt it was reasonable to expect an 8% annual return on their investment, they could use this formula to find out how much they needed to invest to meet their goal.
What Is a Good CAGR?
What counts as a good CAGR will depend on the context. But generally speaking, investors will evaluate this by thinking about their opportunity cost as well as the riskiness of the investment. For example, if a company grew by 25% in an industry with an average CAGR closer to 30%, then its results might seem lackluster by comparison. But if the industry-wide growth rates were lower, such as 10% or 15%, then its CAGR might be very impressive.
In general, a higher CAGR is better.
Modifying the CAGR Formula
An investment is rarely made on the first day of the year and then sold on the last day of the year. Imagine an investor who wants to evaluate the CAGR of a $10,000 investment that was entered on June 1, 2013, and sold for $16,897.14 on Sept. 9, 2018.
Before the CAGR calculation can be performed, the investor will need to know the fractional remainder of the holding period. They held the position for 213 days in 2013, a full year in 2014, 2015, 2016, and 2017, and 251 days in 2018. This investment was held for 5.271 years, which is calculated by the following:
2013 = 213 days
2014 = 365
2015 = 365
2016 = 365
2017 = 365
2018 = 251
The total number of days that the investment was held was 1,924 days. To calculate the number of years, divide the total number of days by 365 (1,924/365), which equals 5.271 years.
The total number of years that the investment was held can be placed in the denominator of the exponent inside CAGR’s formula as follows:
Investment CAGR=(
$10,000$16,897.14
)
5.2711
−1×100=10.46%
Smooth Rate of Growth Limitation
The most important limitation of the CAGR is that because it calculates a smoothed rate of growth over a period, it ignores volatility and implies that the growth during that time was steady. Returns on investments are uneven over time, except for bonds that are held to maturity, deposits, and similar investments.
Also, the CAGR does not account for when an investor adds funds to a portfolio or withdraws funds from the portfolio over the period being measured.
For example, if an investor had a portfolio for five years and injected funds into the portfolio during the five-year period, then the CAGR would be inflated. The CAGR would calculate the rate of return based on the beginning and ending balances over the five years, and would essentially count the deposited funds as part of the annual growth rate, which would be inaccurate.
Other CAGR Limitations
Besides the smoothed rate of growth, the CAGR has other limitations. A second limitation when assessing investments is that no matter how steady the growth of a company or investment has been in the past, investors cannot assume that the rate will remain the same in the future. The shorter the time frame used in the analysis, the less likely it will be for the realized CAGR to meet the expected CAGR when relying on historical results.
A third limitation of the CAGR is a limitation of representation. Say that an investment fund was worth $100,000 in 2016, $71,000 in 2017, $44,000 in 2018, $81,000 in 2019, and $126,000 in 2020. If the fund managers represented in 2021 that their CAGR was a whopping 42.01% over the past three years, they would be technically correct. They would, however, be omitting some very important information about the fund’s history, including the fact that the fund’s CAGR over the past five years was a modest 4.73%.
CAGR vs. IRR
The CAGR measures the return on an investment over a certain period of time. The internal rate of return (IRR) also measures investment performance but is more flexible than the CAGR.
The most important distinction is that the CAGR is straightforward enough that it can be calculated by hand. In contrast, more complicated investments and projects, or those that have many different cash inflows and outflows, are best evaluated using IRR. To back into the IRR, a financial calculator, Excel, or portfolio accounting system is ideal.
Those interested in learning more about CAGR and other financial topics may want to consider enrolling in one of the best investing courses currently available.
What Is an Example of Compound Annual Growth Rate (CAGR)?
The CAGR is a measurement used by investors to calculate the rate at which a quantity grew over time. The word “compound” denotes the fact that the CAGR takes into account the effects of compounding, or reinvestment, over time. For example, suppose you have a company with revenue that grew from $3 million to $30 million over a span of 10 years. In that scenario, the CAGR would be approximately 25.89%.
What Is the Difference Between the CAGR and a Growth Rate?
The main difference between the CAGR and a growth rate is that the CAGR assumes the growth rate was repeated, or “compounded,” each year, whereas a traditional growth rate does not. Many investors prefer the CAGR because it smooths out the volatile nature of year-by-year growth rates. For instance, even a highly profitable and successful company will likely have several years of poor performance during its life. These bad years could have a large effect on individual years’ growth rates but would have a relatively small impact on the company’s CAGR.
Can the CAGR Be Negative?
Yes. A negative CAGR would indicate losses over time rather than gains.
What Is Risk-Adjusted CAGR?
To compare the performance and risk characteristics among various investment alternatives, investors can use a risk-adjusted CAGR. A simple method for calculating a risk-adjusted CAGR is to multiply the CAGR by one minus the investment’s standard deviation. If the standard deviation (i.e., its risk) is zero, then the risk-adjusted CAGR is unaffected. The larger the standard deviation, the lower the risk-adjusted CAGR will be.
The Bottom Line
CAGR is a valuable metric for investors to gauge the performance of their investments over time. By smoothing out annual returns, it provides a clearer picture of an investment's growth trajectory. However, while CAGR can help compare different investments and predict future values, it does not account for volatility or risk. Investors should use CAGR alongside other measures to make well-informed decisions, understanding its limitations in reflecting the full scope of investment performance.
The compounded annual growth rate (CAGR) is one of the most accurate ways to calculate and determine returns for anything that can rise or fall in value over time.
It measures a smoothed rate of return.
Investors can compare the CAGR of two or more alternatives to evaluate how well one stock performed against other stocks in a peer group or a market index.
CAGR is thus a good way to evaluate how different investments have performed over time, or against a benchmark.
The CAGR does not, however, reflect investment risk.
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