Read Weekly India Business News 10th to 14th September 2018:
– Voltbek Home Appliances, a joint venture between Voltas and Turkey-based Arçelik, restricted so far to ACs and air coolers, shall launch 100 products in home appliances segment over the next 3 months. The firm is aiming to generate ₹10,000 crore in revenues by 2025. In the next few years, India’s home appliances market is projected to grow at 10-12% annually, from around an estimated ₹43,000 crore last year (excluding ACs).
– With the launch of Savlon pen sanitizer spray, ITC has entered the hand sanitiser segment, pegged at around Rs.70-80 Crore.
– Patanjali is now planning to sell packaged cow milk and milk-based products like paneer, curd, etc. Indian dairy market of around ₹90,000 crore has been dominated by co-operatives till now.
– Diageo India is looking at small towns to grow its premium scotch portfolio. The firm has around 45% volume share in the Indian scotch whisky market of three million cases per year.
– Indian Railways is expecting to earn around ₹15,000 crore in the next 10 years using the non-fare revenue model. They shall award contracts for 3 to 5 years for services like ads on trains, offering digital content to passengers, etc.
– Nayara Energy, backed by Rosneft – the Russian energy giant, has chalked out massive expansion plans for India with an investment of Rs.1.5 Lakh Crore. The expansion plans include increasing the firm’s retail presence and additional investment at the captive port of Vadinar. Nayara was earlier known as Essar Oil.
– PNB has invited bids from ARCs/FIs for 21 NPA accounts to recover around ₹1,320 crore from the sale. The accounts include Moser Baer Solar, Divine Alloys & Power, Divine Vidyut, Chincholi Sugar, Birla Surya, Shri Saikrupa Sugar among others.
– Samsung has opened its biggest mobile store in the world in Bengaluru in an area of around 33,000 square foot to extend its lead over Apple who doesn’t have any flagship stores in India till now.
– To capitalize on the boom in online retail industry, SpiceJet is starting a dedicated air cargo service from 18th September on both domestic and international routes. The airlines has inducted its first freighter aircraft—a Boeing 737-700—and has also prepared a blueprint to grow the logistics business.
– Greenko Group has called off its plan to buy Orange Renewable from AT Capital Group of Singapore, which it had agreed to buy at an enterprise value of $1 billion. The firm had not divulged any details as to why the deal was called off but just mentioned technical reasons.
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– Alexandre de Juniac, IATA director general and CEO, has said that rise in fuel prices has hit Indian airlines more adversely than their international competitors due to the high tax structure. Fuel makes up 34% of an Indian carrier’s costs, as against 24.2% globally.
– Google has agreed to comply with the data localization norms set by RBI. It has, however, sought an extension of deadline till December end for the same. RBI had told Google among other companies like Facebook, PayPal, Mastercard etc to store data within India.
– Infosys has signed a three-year contract with the Australian Open as its official digital innovation partner. Infosys will leverage emerging technologies like Big Data and Analytics, AI etc. to provide innovative and engaging experiences for the fans.
– Anuj Kapoor, a former employee on a CVS project in Rhode Island has slapped Infosys with a lawsuit for not paying overtime which may result in a US Department of Labor investigation. He alleged that the company made him work more than 1,000 hours of overtime without pay.
– Apollo Global Management Llc has taken over the $300-million real estate portfolio of JPMorgan Asset Management in India as its new Fund Manager. The deal expands Apollo Global’s assets under management in India to about $0.5 billion.
Policies & Practices:
– Trai has decided to reduce the scope of consultation for OTT communication platforms like Skype and WhatsApp in the proposed regulatory framework as it is now seeing rising data consumption due to these kinds of apps.
– As per a PE Roundup report by EY, PE and VC firms invested in India only around $1.6 billion in August, the lowest since February last year’s $1.4 billion worth of investments.
– Bharat Petroleum has decided to move its LPG facility outside Mumbai. The move is to strengthen safety measures and minimise accidents at its Mumbai refinery.
– Union cabinet has approved a proposal for the complete electrification of Indian Railways in the next four years. The move costing the government ₹12,134 crore will reduce dependence on imported fossil fuel as also generate more profits.
– Niti Aayog chief executive Amitabh Kant has asked to increase limits on loans granted through OTB based KYC verification from 60000 currently to 3.5 Lakhs.
– Insolvency and Bankruptcy Board of India is in the process of putting in place the norms on group insolvency. It is also working on a framework for cross-border insolvency cases. But no timeframe for completion has been given till date.
– To improve loan recoveries, the government has asked state-run banks to explore setting up a common e-auction platform for selling confiscated properties. It has also asked banks to raise minimum loan limit for filing of cases in debt recovery tribunals to Rs 20 lakh from Rs 10 lakh currently.
M&As and tie-ups
– Flipkart and Walmart employees will get a chance to switch work between the companies, an internal communication to this effect has been sent to the employees of both the companies asking their interest in switching between the companies to learn about each other’s functioning.
– Sovereign wealth fund GIC of Singapore, Public Sector Pension Investment Board of Canada and Abu Dhabi Investment Authority are all trying to pick a 25% stake in Reliance Home Finance for around ₹1,500-2,000 crore. The funds will be used for the expansion of the firm focusing on affordable housing.
– Jawaharlal Nehru Port Trust may buy the former head office of Air India in Mumbai by the end of the year for about ₹ 2,000 crores. Both JNPT and Air India are carrying out their individual valuations.
– Emso Asset Management, a London based emerging markets hedge fund, managing assets worth $5.8 billion worldwide, is entering into India’s corporate restructuring market and has tied up with Eight Capital Management as its local partner.
– Reliance Jio will use Hughes satellite for providing 4G services to connect around 400 rural and remote areas. It has claimed that JioPhones have 80% market share in sub ₹1,500 mobile phone segment.
– Blaupunkt, the German consumer electronics maker will invest around $300 million in the television business in India over the next 3 to 5 years along with its India partner Trigur Electronics. Currently, Blaupunkt TVs are available in Australia, New Zealand, Europe, Israel and Africa. In India, their products will be sold exclusively on Flipkart.
Start-up world news
– I Squared Capital is in the process of setting up its credit business in India through NBFC or Alternative Investment Fund. They recently closed a $7-billion global infrastructure fund, out of which I Squared is likely to invest around $1 billion in India.
– Employees Retirement System Of Texas, having more than $21 billion in assets under management, has committed to Indian fund IndoSpace Logistics Parks III to invest around $75 million. This is the third fund from IndoSpace Logistics Parks with a target corpus of $550 million.
– FreshMenu has been alleged to have kept under wraps a data breach in 2016 of around 1.10 Lakh users. The revelation was made by HaveIBeenPwned.com, the data breach tracker. The company has not yet released any official statement on the issue.
– Licious, a Gourmet meat start-up, is in talks to raise $25-30 million from new and existing investors. It has so far raised $13 million in funding from various investors. The firm runs on an end-to-end business model – from procuring fresh produce, processing, storage to delivery.
– Digital lender Kissht is in discussions with Russia’s Sistema Asia Fund and Vertex Ventures of Singapore to lead a Series C round of funding to raise up to $50 million.
– Mamaearth, a Mom and baby care consumer start-up, has raised around $4 million in a Series A round of funding led by Stellaris Venture Partners and Fireside Ventures. The firm has so far raised $5.3 million. Mamaearth offers over 50 natural, toxin-free products.
– BabyChakra, an Online parenting platform, has raised an undisclosed amount in its pre-Series-B round from several investors including Mark Mobius and Facebook director Anand Chandrasekaran. The funding will be used to broaden the website’s language and region-specific content and enhance integration in the maternity and healthcare ecosystem.
– Lightbox Ventures has raised $178 million for its third fund and is hoping to close at $200 million by the end of the year. It has invested in startups like Furlenco, Faasos, Embibe and Droom from the previous two funds. The new fund is Lightbox’s largest till date.
Updates on ongoing cases
– Shivinder Singh has withdrawn petition in NCLT against his elder brother Malvinder due to the intervention by their mother and other family members.
– Vijay Mallya case – CBI has opened a probe to file a fresh charge sheet on the involvement of finance ministry officials in disbursal of bank loans to Vijay Mallya. Key to the probe are emails recovered during the search of Mallaya’s residence.
– London court shall give its ruling on December 10 on whether Vijay Mallya can be extradited from the UK to India to face fraud charges.
– NCLT has allowed two new bidders of Bharati Defence to submit plans over-riding objections from Edelweiss who were sole bidders so far.
– At the AGM of ICICI Bank, the shareholders sought more clarity from the board on the role of Chanda Kochar in Videocon loan case and also asked as to why an independent probe wasn’t launched before whistleblower complaints were filed with the bank and regulators. The board informed that the bank is cooperating with all the probing agencies.
– Supreme Court has appointed NBCC to develop stalled projects of Amrapali Group and has also directed the Debt Recovery Tribunal to sell off unencumbered commercial properties of the group to recover as much loan amount as possible.
– Essar steel update – Supreme Court shall hear today Arcelor’s plea for seeking an extension of time for payment of Rs 7,000 crore to make it eligible for bidding in Essar Steel.
– Supreme Court has granted interim relief to stressed power firms asking lenders to maintain a status quo on RBI’s circular for banks to resolve these cases within 180 days; the exposure is above ₹ 2,000 crore. No new petition can be filed and the ones already filed cannot move further.
– ARCS Shipbuild Services of Mumbai and Ricky Nathaniel, the Hong Kong-based investor, have approached the Mumbai bench of NCLT separately to join the resolution process for Bharati Defence and Infrastructure. Bharati Defence’s committee of creditors has already approved the resolution plan submitted by Edelweiss ARC.
– Jet Airways may need to infuse fresh capital to sustain operations. The airlines has already used most of the $300 million raised in June. Salary payments for July and August are also said to be delayed.
– ICICI Bank has filed insolvency petition against Jaiprakash Associates with Allahabad bench of NCLT. NCLT has asked the bank to serve notice to Jaiprakash Associates within 3 days and has also directed Jaypee to file a reply by 17 September. Total debt of Jaypee group has crossed over ₹70,000 crore.
– The government has extended the deadline for submission of initial bids for 51% stake sale in Pawan Hans to 19th September. The bidders will also have the option to buy ONGC’s stake of 49%.
– Coca-Cola has emerged as the frontrunner to buy the consumer brand portfolio of Kraft Heinz, which includes children’s milk drink Complan, Sampriti Ghee, Nycil talcum powder and Glucon D, for about ₹4,000-5,000 crore. If the deal goes through, this will be Coke’s second big acquisition in India after it bought Parle’s beverage brands, including Thums Up about two decades back.
– For the first time, Cognizant may replace its CEO with an outsider. Francisco D’Souza, the current CEO may step down next year. Till now Cognizant’s president Rajeev Mehta was considered to succeed D’Souza.
– HDFC Life has elevated Vibha Padalkar, its current CFO and ED as the new MD & CEO for three years. It’s previous CEO Amitabh Chaudhry had resigned to join Axis Bank.
– CEO of Infosys, Salil Parekh, is reluctant to hire senior executives from outside the company. His approach is different than that of former CEO Vishal Sikka, who in his first nine months hired 14 executives from SAP AG.
– Jack Ma, the founder of Alibaba Group has charted his succession plan and will hand Alibaba’s helm to CEO Daniel Zhang next year officially on his 55th birthday next year. Jack Ma will, however, remain on the board until 2020. Alibaba has invested heavily in India in companies like Zomato, Swiggy, BigBasket, etc.
– Ola is set to name Vijay Ghadge, current a VP as the COO. The position has been vacant after Vishal Kaul left the company in May. Vijay is among the key members in Founder and CEO Bhavish Aggarwal’s team.