General Awareness

BUSINESS AND ECONOMY - October 2018

Oct 2018

May 24, 2019

Continental Warehousing Acquires Stake in Kribhco Infra

Continental Warehousing Corporation (Nhava Seva) Ltd., (CWCNSL), a 90%-owned subsidiary of Hindustan Infralog Pvt. Ltd. (HIPL), acquired 76% stake in Kribhco Infrastructure Ltd.
(KRIL), an integrated multi-modal logistics operator for an unspecified amount.
Hindustan Infralog is a joint venture between DP World and the National Investment and Infrastructure Fund (NIIF).
KRIL operates three major inland container depots/private freight terminals in Haryana, Uttar Pradesh and Gujarat.
It has container train operations with a pan-India outreach. KRIL has a presence in the National Capital Region, which is India's largest import-export market with a population of over 46 million, including a terminal located on a notified double stack route.
The acquisition of KRIL will augment DP World's existing business in terms of the business model and geographic footprint, offering an integrated portfolio to the entire logistics value chain.

Reliance Capital Exits Mutual Fund

Anil Ambani-controlled Reliance Capital is all set to exit the mutual fund business by selling its entire stake in Reliance Nippon Life Asset Management Ltd.(RNAM) to its foreign partner Nippon Life Insurance.
Reliance Capital Ltd. signed binding definitive agreements with Nippon Life Insurance of Japan to exit its stake in Reliance Nippon Life Asset Management Ltd.
Both Reliance Capital and Nippon Life currently hold 42.88% in the asset management company with the balance held by public shareholders.

Cipla to Buy 26% stake AMPSolar

Drug firm Cipla signed a pact to acquire 26% stake on a fully diluted basis in AMPSolar Power Systems Pvt Ltd. for Rs. 12.90 crore.
AMPSolar Power Systems is a wholly-owned subsidiary of AMPSolar Technology Pvt Ltd. and is a special purpose vehicle formed for setting up a captive solar power project in Maharashtra.

Adani to Set Up Container Terminal in Myanmar

Adani Ports and Special Economic Zone (APSEZ) will set up its container terminal in Myanmar, first outside India, at an estimated cost of $290 million (over Rs. 2,000 crore).
The company signed an agreement to develop and operate a container terminal at Yangon Port in Myanmar.
Construction for Phase-1 of the project will commence in June and will be completed by June 2021. It is a two-phase project.

May 23, 2019

SEBI Mulls Buy-back Norms' Review

Regulator SEBI proposed changes to share buy-back norms for companies having non-banking financial companies and housing finance companies as subsidiaries.
A discussion paper was issued to seek suggestions relating to the review of conditions for buy-back of securities.
According to the discussion paper, the committee had proposed that post buy-back, debt to capital and free reserves ratio of 2:1 should be considered on consolidated basis, excluding subsidiaries that are regulated and have AAA ratings.

U.K. and Japan Begin to Turn Away from Huawei

Google's decision to cut off support to Huawei, the Chinese telecommunications giant blacklisted by the Trump administration, is rippling across the globe as companies suspend ties to the handset-maker.
In Britain, where Huawei is one of the most popular cellphone brands, two of country's biggest mobile networks, EE and Vodafone, announced they would stop offering Huawei phones to 5G customers as a result of Google's decision.
In Japan, the three largest cellphone companies also said that they were reconsidering plans to sell a new series of Huawei smartphones.

May 22, 2019

Nepal Bans Chinese Digital Wallets

Nepal banned popular Chinese digital wallets Alipay and WeChat to prevent the loss of foreign currency earnings from tens of thousands of Chinese tourists.
Over 1,50,000 Chinese holidaymakers visited Nepal in 2018, many using digital wallets to pay in hotels, restaurants and shops in tourist areas, especially in Chinese-run businesses.
Laxmi Prapanna Niroula, a spokesman for the central bank, said that Nepal was losing out since the actual transactions took place in China.

Reliance Topples IOC

Reliance Industries has toppled State-owned Indian Oil Corp. (IOC) to become the country's biggest company by revenue.
Reliance, in the 2018-19 fiscal year that ended March 31, reported a turnover of Rs. 6.23 lakh crore.
In comparison, IOC posted a turnover of Rs. 6.17 lakh crore for the fiscal.
It was also the most profitable company in the country with a net profit of more than double that of IOC in FY2019.

Reliance Retail Set to Disrupt Amazon, Walmart-Flipkart

Reliance Retail's upcoming entry into the online retail sector is the biggest challenge for Amazon and Walmart-Flipkart as the Mukesh Ambani-led behemoth is well positioned to create massive disruption in the market.
According to the global market research firm Forrester, the online retail sales in India will grow at a five-year CAGR of 25.8 per cent to reach $85 billion by 2023, despite the hiccups of demonetization in 2016, GST in 2017 and the governmental changes in e-Commerce policy announced in December 2018.
The time is ripe for Reliance Retail, which operates 10,415 stores in more than 6,600 cities, with 500 million annual footfalls - giving the company the kind of scale required to swiftly launch India-based operations.
One of the things that will trouble Amazon and Flipkart is Reliance's history of launching operations via massive discounts.

Indian Terrain Plans European Foray

As per reports, Indian Terrain Fashions Ltd. (ITFL), a leading player in branded, men's casual wear, is toying with the idea of foraying overseas.
According to V. Rajgopal, founder-chairman, ITFL, to start with, one outlet in Denmark would be seeded to see the results.

PNB Likely to Take Control of Small State-run Banks

India's Punjab National Bank is looking to merge with two or three government owned banks that could include Oriental Bank Of Commerce, Andhra Bank and Allahabad Bank, as New Delhi tries to cut the number of state-owned lenders.
This could be one of the first decisions to be taken by the new government after election results to be announced.
Banking sector reform is unfinished business from the last five year term of Modi's government as banks struggle under a huge debt pile than of more than 9 trillion Indian rupees ($130 billion), or nearly 5% of the nation's gross domestic output.

May 21, 2019

Government to Divest Stake in RailTel

The government is looking to divest up to 25% stake in RailTel Corporation, and is scouting for merchant bankers to manage the listing process.
The government will appoint up to three merchant bankers to manage the listing process and has invited bids from them.
The paid-up share capital of the Railway PSU stands at Rs. 320.93 crore and profit after tax for 2017-18 was Rs. 156 crore.

ORIX Offers to Buy Out IL&FS Wind Assets

ORIX Corporation of Japan (ORIX), owner of 49% stake in each of the seven operating wind power plants (SPVs) of the IL&FS Group, has expressed its intent to buy out the remaining 51% stake held by IL&FS Wind Energy Limited (IWEL).
This intent to buy 51% stake is in exercise of ORIX's right under the terms of an existing MoU wherein ORIX can match the price offered by the highest bidder for purchasing IWEL's Stake in the Wind SPVs.

India Unlikely to Give Additional Seats to Foreign Airlines

India is unlikely to grant additional seats to foreign carriers, over and above the numbers agreed to under bilateral pacts, even though Indian expatriates in some of these countries are facing the prospect of having to pay sharply steeper airfares during the peak travel season this year following the grounding of Jet Airways.
The authorities in the UAE have written to the Indian government requesting additional capacity for its Dubai-based airlines Emirates and FlyDubai.
Qatar Airways announced that it had approached Indian authorities for more seats on high volume routes such as Delhi, Mumbai and Bengaluru on a temporary basis.

Under Armour in Talks with Myntra

The US sportswear brand Under Armour is in talks with the fashion e-commerce platform Myntra to become the first large international brand that Myntra's new leadership team will manage offline in India.
Myntra is keen to tie up with the brand as it is focusing on opening stores in mall locations as opposed to on high streets which typically have higher rents. The business is also concentrating on a younger customer base which the Under Armour brand caters to.
If the partnership goes through, Under Armour would be the first large foreign brand to sign up with Myntra since Walmart acquired the business' parent company Flipkart in 2018.
Under Armour currently has one store in India in New Delhi which opened in March 2019. The brand first entered India two years ago selling exclusively on Amazon India.

May 20, 2019

BoB Looks to Rationalise Branches

State-owned Bank of Baroda (BoB) is considering the option of rationalising 800-900 branches across the country to improve operational efficiency, following its merger with Dena Bank and Vijaya Bank.
The merger of Dena Bank and Vijaya Bank with Bank of Baroda became effective from April 1.
There are cases where branches of three banks are at one location or one building. So these branches have to be either closed or rationalised as duplication is a drain on efficiency.

Orix to Buy Out Wind Energy Assets

Japan's Orix Corp., which owns 49% stake in each of the seven operating wind power plants of debt-laden IL&FS Group, has expressed its intent to buy out the remaining 51% stake held by IL&FS Wind Energy Ltd (IWEL).
Orix will exercise its right under the terms of an existing pact with IL&FS wherein Orix can match the price offered by the highest bidder to buy IWEL's stake in the wind power plants, IL&FS said in a release.
In April, state-run gas utility GAIL (India) Ltd had offered to pay Rs. 4,800 crore (as enterprise valuation) for the 874 megawatts (MW) wind portfolio, subject to Orix agreeing to the sale.
Orix, however, has now decided to buy out the remaining 51% stake by matching GAIL's offer. The sale process to Orix is expected to be completed by June.

IGI Airport Records Lowest Passenger Growth

Delhi airport, the busiest in the country, recorded the lowest growth rate in the last financial year in terms of passengers since 2012-13.
According to data released by Airports Authority of India (AAI), the Delhi airport handled 69.23 million passengers in 2018-19, 5.4% more than in 2017-18.
Before the 2018-19 financial year, the airport has maintained a consistent double-digit growth rate.
According to DGCA data, the industry witnessed the lowest passenger growth rate since June 2014 in March 2019.

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