India business news headlines weekly roundup 4th to 8th Feb 2019:-
- RIL has announced plans to invest around Rs.10,000 crores in West Bengal. It has set up direct distribution channels, Jio Points, to cater to the growing rural market.
- Jet Airways has raised Rs.250 crores from advance ticket sales to Jet Privilege customers. The airlines had raised around Rs.258 crores from advance sale of tickets to Jet Privilege in Oct.2018 also.
- Tata Motors has reported its biggest ever quarterly loss of Rs.26,960.8 Crores for the quarter ending Dec.31, 2018. This includes a one-time asset impairment in JLR.
- As per the company, WhatsApp has been removing 2 million suspicious accounts every month to prevent fake news.
- ITC Wills Lifestyle has been renamed WLS. The firm is making a shift to 100 natural and biodegradable materials.
- Essar Oil UK, part of the Ruias’ Essar Group, has acquired stakes in two terminals and one pipeline from BP Plc to expand its UK business. Though the deal amount has not been disclosed, it is expected to be around $120-130 million.
- Jet Airways has altered its cancellation policy from Feb 7 onwards for all categories.
- PNB has set a target to recover Rs.10,000 crores from NPAs in the quarter ending March 2019. It includes Rs.6,000 crores from Essar Steel and Bhushan Power & Steel.
- Mutual fund houses having an exposure of around Rs.8,000 crores in Essel Group have asked Sebi to allow some time to the promoters to rope in strategic investors.
- The government has allowed Amazon’s food retail license holding entity, Amazon Retail, to sell on its India marketplace.
- Oyo is set to expand into the USA and is said to be testing rooms in Texas.
- Facebook has announced a digital skilling mentorship program aimed at inspiring and guiding tribal girls in Maharashtra, Odisha, MP, Jharkhand and West Bengal.
- Vodafone-Idea has posted a loss of Rs.5000 Crores in the quarter ending December 2018.
- Flipkart is in talks with offline retailers and distributors of Samsung, Xiaomi and FMCG products to bring them on board as online retailers.
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Some more news from Corporates
- PMO has held meetings to speed up the strategic sale of PSUs identified by Niti Aayog. The list includes Air India, Dredging Corporation, BEML, Scooters India from which the government expects to generate around Rs.90,000 crores.
- Dish TV shall invest Rs.3,000 crores in its subsidiary Dish Infra Services.
- NCLT has ordered liquidation of Reid & Taylor India after investors put up by the employees association and other bidders failed to come up with a viable revival plan. The company owes over Rs.4,100 crores to its lenders.
- Pilots of Jet Airways have warned that if the salaries are not paid they will collectively take a final call in March. The airlines is yet to clear salaries from November onwards in part/full.
- The government has withdrawn duties on key components used in Mobile phones such as LCD display, touch panel etc from Feb.1. This shall keep mobile phone prices under control.
- The govt has accused Amazon and Flipkart of influencing prices of goods on their platforms through various means and has defended its decision to implement new FDI rules.UPL Ltd may buy back the stakes of Abu Dhabi Investment Authority and TPG Capital in Arysta LifeScience for $4.2 billion. Both invested $1.2 bn for a combined stake of 22% in UPL Corp. to help firm acquire Arysta.
- ONGC Videsh is exploring the option of transfer of its stake in Imperial Energy Corp.’s Siberian deposits to a Russian firm to reduce potential losses from the $2.1-billion acquisition.
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- Essel promoter entities have raised Rs.1050 crores by selling shares in 6 listed firms.
- SpiceJet will start a daily non-stop flight between Hyderabad and Jeddah from 25th March.
- Bhushan steel case – NCLAT has dismissed Tata Steel’s appeal in Bhushan Power case and has upheld CoC’s right to change, update, supplement, add to, delay or cease resolution process at any time.
- The board of Future Retail has approved raising around Rs.2,000 crores through the issue of warrants to its promoters on a preferential basis.
- IIFL has agreed to sell its Rs.4000 Crore commercial vehicle business to Indostar Capital, promoted by Everstone.
- Amazon, Flipkart, Paytm and Snapdeal are yet to clearly display details of all the sellers on their platform. Morgan Stanley has said that Flipkart may need to remove approx. 25% of its products from its platform to meet new FDI rules. It has also reportedly warned that Walmart may exit Flipkart if it doesn’t see the long term path to profitability.
- Jubilant FoodWorks, which runs Domino’s Pizza chain, has been fined Rs.41.4 Croes for not passing on the GST relief to customers.
- IDBI Bank board has approved a proposal to change of name of IDBI Bank following its takeover by LIC. It could be named as LIC IDBI Bank or LIC Bank.
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- Blackstone Group which signed a definitive agreement to buy a controlling stake in Aadhar Housing Finance will infuse Rs.800 crores as additional equity. This will double the company’s net worth and reduce its debt-to-equity ratio by almost half.
- RCom will propose a plan to sell its telecom infrastructure assets, airwaves and real estate to resolve its debt. Last week the firm had said that it will seek fast-track resolution through NCLT.
- Essel Group has entered into a formal agreement with its lenders under which it gets time till September to deleverage or pare its debt. These lenders have taken pledged shares of Zee Entertainment and Dish TV.
- To adhere to new FDI policy norms, Amazon removed Cloudtail and Appario in which it had interests. Though it has got new sellers on board, the delivery remains a concern, which is now taking 4-5 days compared to 1-2 days earlier.
- Piyush Goyal is scheduled to address a post-budget meeting of central board of RBI on 9th Feb. The board meeting would also discuss the request of the government for an interim dividend for the current fiscal.
- Sales at Paytm Mall have seen a slump after it slashed cashback by more than 80% across categories.
- Ericsson is set to file a petition in Supreme Court pleading that all the personal assets of Anil Ambani be seized for breach of SC order to repay Ericsson.
More in India business news headlines weekly roundup 25 Jan-1st Feb
Policies & Practices
- Reliance Jio has backed govt over tracing the origin of messages to contain the spread of fake news even if it means breaking encryption. Other players are citing privacy issues.
- To ensure consumer grievances are addressed, the RBI is planning to come out with a discussion paper on regularising payment gateways.
- RBI has eased bank loan norms for NBFCs with top ratings.
- Sebi has asked exchanges to step up their surveillance of intra-day trading.
- The govt is exploring a pre-packaged bankruptcy plan to fast track the insolvency process. Under the pre-packaged scheme, a company in financial distress will be able to chalk out a resolution plan before moving NCLT. The move is aimed at cutting the cost and time of the resolution process.
- The government has refused the proposal of Trai for giving free internet connections to the poor. The commission found that the mobile tariffs across the country are already pretty low.
- The Government is setting up a panel to solve angel tax issues. The panel will comprise of startups, angel investors and income tax officials.
M&As and tie-ups
- CCI has given approval to state-owned financial institution Power Finance Corporation for the acquisition of 52% stake in REC, which is expected to get the government Rs.15,000 Crores.
- As per a report from EY, PE/VC deals fell 49% from the year ago to $1.8 billion in Jan.2019.
- As per media buyers estimates, UberEats, Swiggy and Zomato together are expected to spend around Rs.300 crores on advertising in 2019.
Start-up world, funds and fundings
- Avendus Capital has launched a $1-billion fund to invest solely in environment, social, and governance values focussed companies. 30% of the fund will be raised from domestic investors.
- Zomato has raised $40 million in funding from US investor Glade Brooke. The funding is part of the Series I round of $210 million from Ant Financial Zomato raised in October.
- Mohandas Pai-backed 3one4 Capital shall raise Rs.350 crore for its new fund Continuum I. The early-stage investor has invested in data platform Tracxn, meat delivery firm Licious and fintech startup Tonetag.
- Samunnati Financial has raised $5 million in debt from Symbiotics. Samunnati provides affordable and customized financial product offerings to small/marginal farmers, working capital loans to community-based organizations and receivable finance to agri SMEs.
- TPG Growth shall invest $30 million in API maker Solara Active Pharma.
- VC firm A91 Partners has invested around Rs.60-70 crores in make-up brand Sugar Cosmetics. This is the first investment of A91 Partners from its ₹2,000-crore fund.
- KKR and Co. will infuse ₹100 crores into its asset reconstruction company by 31st March. KKR invests in private high-yield debt in India.
- Ruchi soya case – NCLT has dismissed the petition of Standard Chartered Bank to reclassify it as a financial creditor to Ruchi Soya Industries stating it is too late to seek such a change. Ruchi Soya owes more than ₹10,000 crore to banks and financial institutions.
- Essar steel update – Kamaljeet Singh Ahluwalia, an operational creditor has moved SC challenging NCLAT’s powers to pass an order on the insolvency case.
- Vijay Mallya case – UK Home Secretary has given his approval for the extradition of Vijay Mallya. ED and CBI have not been officially informed yet. Mallaya said that he will appeal against the decision. ED has cleared restoration of Vijay Mallya’s properties to the consortium of banks led by SBI. The banks would, however, need to give an undertaking on returning the money.
- Essar Steel – NCLT shall decide on Essar Steel insolvency by 11th February. BPCL has sought the liquidation of the assets of Essar Steel. It has objected to ArcelorMittal’s resolution plan. Ruias and Essar Steel directors have also moved NCLT to squash Mittal’s takeover bid.
- IL&FS – As per an asset solvency test by the new management, IL&FS believes the group has only 22 fully-solvent entities, which can pay off their combined debt of Rs.6,605 crores. This is just 7% of the group’s estimated debt of Rs.89,393 crores of 173 Indian subsidiaries.
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- Livspace has appointed Kartikeya Bhandari, formerly senior marketing director of Flipkart, as its first-ever CMO. Livspace had raised $70 million in a Series C round of funding in 2018.
- Fortis Healthcare has appointed renowned cardiac surgeon Dr.Ashutosh Raghuvanshi as CEO.
- Pradeep Singh Kharola, Air India chief has been appointed civil aviation secretary.
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