General Awareness

BUSINESS AND ECONOMY - February 2017

Feb 2017

Jan 29, 2019

Paytm Mall to Focus on 'Online to Offline'

Paytm Mall, the ecommerce arm of Paytm Group, is undertaking a significant restructuring of its top and mid-level executive teams, amid speculation that the firm plans to focus on catering to its merchant ecosystem through B2B category and on offline-toonline consumer businesses.
The Alibaba Group and SoftBankbacked company has moved Sudhanshu Jain, chief financial officer of Paytm Bank, as the financial comptroller of the online business.
Paytm Mall has also brought on board Bharti Balakrishnan, senior director with Alibaba Group, to lead certain unstructured categories including fashion, home and kitchen, while Varun Gupta, a three-plus-year veteran at the company, has been elevated to lead its groceries vertical. Sirinivas Mothey is now the firm's chief marketing officer.
Meanwhile, Saurabh Vashishtha and Amit Bagaria, both senior vice presidents who had been tasked to lead critical functions such as marketing and customer acquisitions, have quit Paytm Mall.

Tata Steel to Sell Business to HBIS Group

Tata Steel Ltd has agreed to sell most of its steel business in South-east Asia to China's stateowned HBIS Group as the Indian steel maker continues efforts to trim its massive debt and focus on its fast-growing home market.
Mumbai-based Tata Steel will sell a 70% stake to HBIS for $327 million in cash. It will retain a 30% stake.
Under the deal, TS Global Holdings Pte. Ltd (TSGH), an indirect wholly-owned unit of Tata Steel, signed definitive agreements with an entity controlled by HBIS to sell its entire stake in NatSteel Holdings Pte Ltd. and Tata Steel (Thailand).

Most e-wallets may get invalid by Feb

Lakhs of mobile wallets are set to become invalid by the end of February as these companies are struggling to comply with RBI rules for user-data verification or KYC.
It is estimated that as high as 80% of transacting users are yet to comply with KYC.
The SC ruling that barred private entities from using Aadhaar has made it tougher for companies to do KYC.
While a partial KYC could previously be done on the basis of an OTP to the mobile number, now a full KYC needs to be done, which involves submission of various documents, including ID proof and address proof.
The impact on Paytm and Amazon would be more compared to players like PhonePe since the latter is focused more on UPI and is less dependent on its wallet.
Amazon has recently started going to users' doorsteps to collect relevant documents.

Iran Eyeing Construction at Chabahar Port

Close on the heels of the launch of a new shipping route connecting three Indian ports with Chabahar, Iran is eyeing the construction of a gas pipeline and a railway link to Zahedan to boost activities at the strategic port.
The first Indian container vessel operating on the new route set sail from Mumbai and called at Mundra and Kandla ports in Gujarat before berthing at Shahid Beheshti terminal of Iran's Chabahar port, whose operations are controlled by state-owned India Ports Global Limited. The vessel will continue to Bandar Abbas, the final port of call on the route.
As part of measures to boost infrastructure at the port and its free trade zone, Iran is looking at the construction of a nearly 200-km gas pipeline from Iranshahr to Chabahar and a railway link of about 500 km from Chabahar to Zahedan, which is close to the Afghan border.
As part of joint efforts to promote Chabahar port and attract investments, India and Iran will organise the "Chabahar Day" conference on February 26.
Delegates from central Asian countries, traders and freight companies are expected to attend the event.

Moody's affirms ratings of Lodha group

Credit rating agency Moody's has affirmed the ratings of corporate family and bonds issued by realty major Lodha Developers (LDL), but changed the outlook to stable from positive on weak operating sales during the first half of this fiscal.
The company's two transactions — divestment of London assets and a fund-raise of about Rs 500 crore in Palava township — have not been considered while assigning the ratings.

RBI Asks P2P Lenders to Furnish Key Details

The Reserve Bank of India (RBI) has asked all registered peer-to-peer (P2P) lenders to furnish details about borrowers, lenders, their financial profiles, total exposure of participants and the financial health of the platforms themselves as it looks to assess the overall well being of the sector.
The RBI has sent the platforms a spreadsheet that needs to be filled in. This includes data on their net owned funds, metrics such as profit, loss, operational expenses, delinquency status of loans disbursed and overseas investments in the companies.
Going forward, the platforms will have to report these numbers to the RBI once every three months.
The move follows several NBFCs losing registration in the past few months as the regulator has clamped down on those not adhering to the rules.
The platforms currently don't have any means of checking whether an investor is adhering to the Rs.10 lakh participation limit in P2P lending imposed by the RBI.
The same cap applies to borrowers as well. Platforms rely on self-declaration to remain in compliance.

3 ex-Tata Execs to Launch $1bn Fund with Quantum

Three former Tata leaders, led by Mukund Rajan, will launch a $1-billion public equities fund in association with Quantum Advisors, a boutique asset management company.
The fund will invest mainly in listed midcap companies that are doing well on environment, social and governance (ESG) fronts.
Quantum will hold 50% in the fund, while the balance will be owned equally by the three former Tata veterans.
The venture will be chaired by Rajan, who used to be the Tata Group's brand custodian and a key member of the executive council during Cyrus Mistry's tenure as the conglomerate's chairman.
Rajan is joined by former Tata Capital honcho Govind Sankaranarayanan and ex-Tata Sons director Alan Rosling.
The fund plans to invest at least $40 million in a company in a bid to acquire a significant stake — to make a difference in terms of improving its governance standards.
The proposed public equities fund by former Tata executives comes at a time when global sponsors (called limited partners or LPs in industry parlance) have turned cautious and selective in choosing Indian asset managers.
These sponsors — global pension and sovereign wealth funds, family offices, university endowments — are consolidating their India exposure behind local fund managers with a proven track record.

Jan 28, 2019

IL&FS Spanish Arm under IBC Process

Troubled IL&FS group said the board of Spain's Elsamex has unanimously agreed for initiation of voluntary insolvency proceedings in Spain, in view of lack of liquidity. IL&FS' arm IL&FS Transportation Networks (ITNL) had acquired Elsamex, a road maintenance, operation and management company.
The board of Elsamex, a subsidiary, has conducted a detailed analysis of the evolution of the company, the financial risks, the lack of liquidity to meet the due dates and the latest court resolutions.

PhonePe Set to Enter Fin Services

PhonePe, the payments arm of Flipkart, is set to enter financial services, starting with the sales of mutual funds through its app. The move comes at a time when the fintech space is seeing heightened action with multiple startups raising capital. PhonePe aims to tap the growing base of millennials looking to manage their wealth.
PhonePe, which was acquired by Flipkart three years ago, has become one of the critical standalone businesses for the latter, with over 30 million monthly transacting consumers. The entry into financial services pits the Bengaluru-based company once again against arch-rival Paytm.
The ease of making investments or buying insurance on an app is drawing interest. Most recently, Groww, an earlystage startup for such investments, raised over $6 million from a bunch of investors.

Four Firms Together Add Rs. 54,456 Cr in M-Cap

Four of the top-10 most-valued firms together added Rs. 54,456.69 crore in market capitalisation (m-cap), with Reliance Industries Ltd (RIL) taking the lead as its valuation surged the most.
While RIL, Tata Consultancy Services (TCS), Hindustan Unilever Ltd (HUL) and Kotak Mahindra Bank were the gainers, HDFC Bank, ITC, HDFC, Infosys, SBI and ICICI Bank suffered losses in their valuation for the week.
In the ranking of top 10 firms, RIL was at number one place followed by Tata Consultancy Services, HDFC Bank, HUL, ITC, HDFC, Infosys, SBI, Kotak Mahindra Bank and ICICI Bank.
Over the last week, the BSE Sensex fell by 361.07 points to end at 36,025.54.

Jan 27, 2019

Concerns over India's Trade Interests Post-Brexit

The law ministry has cautioned the commerce ministry that the UK's imminent exit from the European Union (EU) is a matter of serious concern for India's trade and industry and the government must take legal recourse to protect Indian interests during the Brexit.
The Law Ministry wants the administrative ministry (Commerce Ministry) to take up the matter in the WTO (the World Trade Organisation).
The government's legal experts have said that Brexit could restrict Indian companies' access to the EU through the UK. Several commercial agreements will also need to be renegotiated on account of this.
The government has been discussing this matter with trade experts, legal specialists and the industry bodies, including FICCI and CII.
Some sectors that are likely to face the heat due to Brexit include automobiles, auto components, pharmaceuticals, gems and jewellery, education and IT enabled services. Most of these sectors will be vulnerable to changes in demand and currency values.

Jan 26, 2019

Renault-Nissan Alliance Gets a Reboot

The strained two-decade marriage of Renault SA and Nissan Motor Co. is about to get a fresh start.
Within hours, the two main antagonists in the crisis that's paralyzed the world's biggest automotive alliance have said they're leaving the stage. Carlos Ghosn, 64, resigned as chairman and chief executive officer (CEO) of Renault more than two months after he was jailed in Japan on allegations of financial misdeeds.
In an unexpected twist, Nissan CEO Hiroto Saikawa, a former protege of Ghosn who led the campaign against his former boss, said he too intends to step down.
Ghosn's exit, and the prospect that Saikawa could soon hand over the reins, may help remove some of the mistrust that's built up on both sides of the FrancoJapanese alliance.

SC upholds IBC for Smoother Resolutions

The Supreme Court upheld Insolvency and Bankruptcy Code (IBC), a law that bars founders of companies that have defaulted on loans from buying back stressed assets, in a ruling that may help the nation more quickly resolve bad debts.
The apex court said a provision of the bankruptcy law that prevents founders from regaining control of delinquent companies was legally valid.
India has been trying to clean up banks that are suffering from the world's worst bad-loan ratios after Italy, and that have about $210 billion of stressed debt on their balance sheets.
The new bankruptcy code was passed in 2016, exciting interest among distressed debt investors around the world as it barred willful defaulters, as well as founders of defaulting companies from submitting revival plans or bids for their failing firms.
The ruling upholding that section of the code will make the insolvency process more smooth, according to RK Bansal, chief executive officer (CEO) of Edelweiss Asset Reconstruction Co., India's top bad debt buyer.

FB Plans To Merge Insta, WhatsApp & Messenger

Mark Zuckerberg, Facebook's chief executive, plans to integrate the social network's messaging services — WhatsApp, Instagram and Facebook Messenger — asserting his control over the company's sprawling divisions at a time when its business has been battered by scandals.
The move requires thousands of Facebook employees to reconfigure how WhatsApp, Instagram and Facebook Messenger function at their most basic levels. While all three services will continue operating as stand-alone apps, their underlying messaging infrastructure will be unified.
Zuckerberg has also ordered all of the apps to incorporate end-to-end encryption, a significant step that protects messages from being viewed by anyone except the participants in the conversation.
After the changes, a Facebook user could send an encrypted message to someone who has only a WhatsApp account, for example. Currently, that isn't possible because the apps are separate.
By stitching the apps' infrastructure together, Zuckerberg wants to increase the utility of the social network, keeping its billions of users highly engaged inside its ecosystem.

India and South Africa to Boost Two Decade-old Strategic Partnership

India and South Africa agreed on a three-year programme to boost their two decade-old strategic partnership in key areas such as trade, defence, maritime security and information technology.
The "strategic programme of cooperation" was announced by Prime Minister Narendra Modi and South African President Cyril Ramaphosa after delegation-level talks at Hyderabad House.
The strategic partnership was established in March 1997 and the two countries are key players in the BRICS and IBSA groupings. Bilateral trade was worth more than $10 billion in 2017-18.
The two sides signalled their desire to play a greater role in the Indian Ocean, and a joint statement said Modi and Ramaphosa recognised the importance of increased bilateral naval cooperation and closer synergy to ensure unhindered passage for trade by keeping the sea lanes secure against illegal actors.
Both sides agreed to explore solutions to boost trade and investment and Ramaphosa agreed to simplify and reform South Africa's business visa regime. They also expressed concern at the slow pace of UN reforms and agreed to work together to secure representation in an expanded Security Council.

Walmart Pulls out of Google's Shopping Actions

Walmart Inc. has quietly withdrawn from one of Google's marquee efforts to challenge Amazon.com Inc. in e-commerce.
Walmart removed its products from Google's Shopping Actions service. The retailer also recently dropped out of Google Express, a related delivery service.
In March, Google unveiled Shopping Actions, which lets consumers more easily buy goods from retailers through the company's search engine, digital assistant and Express delivery.
The service launched with Walmart and Target Corp. as flagship partners, an alliance that showed the retail stalwarts attempting to curb Amazon's expansion.
Google takes a commission on sales from partners.
Losing Walmart, the world's largest retailer, is a blow for Google. Walmart has emerged as one of Amazon's main e-commerce competitors.
The Bentonville, Arkansas-based company is making a major push to hire tech talent, expand its own delivery service and use its network of physical stores to lure new customers online.

Jan 25, 2019

Amazon Starts Testing 'Scout' Delivery Robots

Amazon.com Inc. will use robots to deliver packages in the suburbs north of Seattle, its latest experiment to automate the last-mile of delivery that's a labour-intensive and costly component of buying products online.
The e-commerce giant announced a trial of "Amazon Scout", autonomous delivery devices the size of a cooler that roll along sidewalks at a walking pace. It will use six robots, which are designed to navigate around obstacles such as people and pets, to deliver packages in Snohomish County. The robots will be used to make deliveries on Monday through Friday during daylight hours.
Using robots to make deliveries outside on city streets will be much more challenging than most current common uses, such as moving items around in warehouses, hospitals and hotels that are well-lit and have level floors. Outside, robots encounter extreme weather conditions, steep inclines, curbs and other problems that present significant engineering challenges.
Amazon already uses robots to move inventory in its vast network of warehouses and has been working on delivery by autonomous drone for years.

Adani may get Majority Stake in Mundra Terminal

Gujarat may offer an additional 50% stake in Gujarat State Petroleum Corp. (GSPC) LNG Ltd to Adani Group, which already holds a 25% stake in the company, after Indian Oil Corp. Ltd decided to opt out of the race.
The Gujarat government, which owns 50% in GSPC LNG, had been looking to induct a third partner for the remaining 25% stake. It may now allow the Adani Group to pick up the 25%, and offload up to 25% of its own stake in the company.
The Gujarat government had set up GSPC LNG as a special purpose vehicle for implementing the project with a proposed capacity to re-gasify 5 million tonnes per annum (mtpa). The cost of the project was estimated at Rs. 4,500-5,000 crore.
The terminal's capacity can be expanded to 10 mtpa and is designed to have a berth for receiving LNG (liquified natural gas) tankers and storage tank facilities for re-gasification and gas evacuation.
The terminal was inaugurated in September 2018 by Prime Minister Narendra Modi.

SBI, Etihad in co-branded card deal

SBI's cards arm has partnered Etihad Airways in a bid to acquire customers of the UAE-based carrier. The partnership comes at a time when Etihad is in talks with Jet Airways to play a larger role.
The co-branded card will offer discounts of 8% and 10% on business and economy tickets, as an inaugural offer. After April, the discount on the business class ticket will continue but will reduce to 3% on economy tickets.
Cardholders will also get a free international companion round ticket on annual spends of Rs 8 lakh. The card has two variants — Etihad Guest SBI and Etihad Guest Premier.

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