Month: June 2021

India’s digital economy to see 10-fold growth to hit $800 billion by 2030: RedSeer

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The pandemic has forced India’s businesses to do business the digital way and consumers to make purchases by browsing through online catalogues. This burgeoning digital economy is expected to touch $800 billion by 2030, according to a report released by consulting firm RedSeer at its event Ground Zero 5.0.

That’s a 10-fold growth over the value assigned to the new-age economy at $85-90 billion in 2020.

As the nationwide lockdowns shuttered multiplexes, malls, and markets, Indians have begun to see online purchases as a means of convenience instead of just using it to get discounts.

Also read: Axis Bank to partner with Amazon Web Services for digital transformation

“Digital services have undoubtedly served the customers very well, which is evident in high customer satisfaction and customers willingness to keep using the digital as a key channel to fulfill their needs,” said Anil Kumar, founder, and chief executive officer, RedSeer.

India To Become 3rd Largest Online Retail Market By 2030

India’s online retailers are expected to see merchandise worth $350 billion passes through their portals by 2030. Currently, the annual gross merchandise value stands at $55 billion, according to the RedSeer report.

In the coming decade, 88 percent of the online shoppers will emerge from smaller cities in India. RedSeer expects more than $150 billion worth of GMV to come from Tier-2+ cities by 2030.

Also read: Has pandemic triggered a paradigm shift in consumer behaviour towards money management?

Barring COVID-19’s push towards greater adoption of e-commerce in small-town India, increased focus on smaller towns and cities by e-retailers, lower logistical costs, and growing online spends are some of the other factors that may lead to exponential growth.

That is not to say it will be detrimental to Kirana Stores, which are expected to achieve approximately $1.5 trillion in sales by 2030, according to the RedSeer report. This growth largely driven by growth will be driven by platforms that are enabling these kiranas technologically via cashless payments, digital bookkeeping, and EB2B offerings.

The Role Of New-Age Logistics Players

While creating employment opportunities for gig workers during the pandemic, India’s E-Logistics space became the fastest-growing market globally with over 3 billion shipments in 2020.

Also read: How fintech industry can prepare itself before third wave of COVID hits?

Today over 90 percent of the orders fulfilled by online commerce get fulfilled by new-age logistics, an industry that has come over the last decade, according to the RedSeer report.

Further, three out of the top 10 logistics players in India are e-logistics players. The new-age logistics players are expected to deliver 2.5 billion Direct-to-Consumer shipments by 2030.

By covering nearly all the pin codes across India through deep tech solutions, E-logistics has enabled smaller cities to account for over 50 percent of e-commerce shoppers at the end of 2020.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

RBI asks banks to surrender non-compliant corporate current accounts by July 30

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Banks will now have to surrender current accounts of all companies or corporate borrowers, where their loan exposure is less than 10 percent of the total approved facilities.

The Reserve Bank of India (RBI) has earmarked a new deadline of July 30 for compliance extending it from the earlier January 31, 2021.

RBI has informed banks through a letter sent 15 days ago about new stricter norms becoming applicable from July 31.

RBI’s move seeks to enforce credit discipline and bar defaulter company-borrowers from diverting funds received from/ through their banks.

The regulator intends to curb non-performing assets (NPAs) and defaults.

Now such companies or corporate borrowers will need to have their current accounts and collection accounts with their lending banks.

The exposure could be in the form of loans, non-fund businesses such as guarantees, day light or intra-day overdrafts, among others. These norms do not cover mutual funds and insurers.

Banks will have to shift such funds to another bank, which meets the RBI-specified exposure rule. Banks could see a reshuffle of several coveted current accounts and cash management business of customers (companies).

Many international banks, multinational banks, public sector banks, private banks and even cooperative banks, among others, are expected to be affected.

Current accounts reduce a bank’s cost of funds. The regulator noticed that certain companies hold current accounts outside the purview of loan consortium banks so as to postpone servicing of loans and timely repayments.

The banking regulator had started this process by notifying the rule in August 2020 and had given a compliance deadline of January 31.  But several banks did not comply or complete the process of transition.

Sources said that several multinational (MNC) banks had opposed the regulator’s move and some were not large lenders but had deployed state-of-the-art technology to integrate the flow of funds between a company and its customers, vendors and associates. They earned on the float as well as leveraged the relationship opportunity to cross-sell products to such chains. They used such tactics to earn fee income without giving big loans. They bypassed the risk of NPAs, according to banking experts.

State-owned banks did not seem to be ready with the technology required for the process of migration.

RBI’s move coincides with the commencement of operations of NARCL, the new ‘bad bank,’ which is expected to handle stressed debt worth two trillion rupees ($27 billion), as per Bloomberg.

After these safeguards, the regulatory norms will streamline the use of multiple accounts by borrowers.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Foreign exchange reserves up $99.2 bn in FY 2020-21: RBI data

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The country’s foreign exchange reserves in nominal terms, including the valuation effects, increased by USD 99.2 billion during the financial year 2020-21, compared to USD 64.9 billion in the preceding year, RBI data showed.

The valuation gain, reflecting the depreciation of the US dollar against major currencies and increase in gold prices, amounted to USD 11.9 billion during 2020-21, compared to USD 5.4 billion during 2019-20, RBI said.

The Reserve Bank of India on Wednesday released the Sources of Variation in Foreign Exchange Reserves in India during 2020-21. On a balance of payments basis (excluding valuation effects), foreign exchange reserves increased by USD 87.3 billion during FY 2020-21, as against an increase of USD 59.5 billion during FY 2019-20, the data showed.

The current account balance stood at USD 23.9 billion in FY 2020-21, as against a deficit of USD 24.7 billion in FY 2019-20. Capital account stood at USD 63.4 billion in FY 2020-21, compared to USD 84.2 billion in the previous fiscal, the data showed.

Foreign investment in the country stood at USD 80.1 billion in FY 2020-21, as against USD 44.4 billion in FY 2019-20, the data showed.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Elon Musk’s Starlink global coverage coming soon: All you need to know

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Starlink, Elon Musk’s satellite-based broadband service, will have global coverage within five weeks. The update came from SpaceX CEO Elon Musk, who was speaking at the Mobile World Congress virtual event. Musk said the service will be in a position to provide global coverage from August.

“In August we should have global connectivity everywhere except the poles,” said Musk.

Will Starlink be Available India from August?

While details are currently sparse, the announcement from Musk is taken to mean that the network of low-earth orbit (LEO) satellites from the company will be fully in position across the globe to provide broadband coverage. This, however, does not necessarily mean that the service will be launched for public use in every country come August.

Currently, Starlink is only available in a test operational capability in 12 countries across the globe. A date of the full launch of service is expected from the company sometime later.

How Much Will it Cost? 

The company has confirmed that subscription for the satellite broadband service will be uniform across the globe at $99 a month, accounting for currency conversion costs. SpaceX has said it is working on more cost-effective next-gen terminals since the current ones are bleeding the company for every sale.

SpaceX might also need to reconsider its pricing options, as the battle for satellite broadband heats up in India. Apart from Starlink, Amazon’s Kuiper Project and OneWeb, backed by the UK government and the Bharti Group, will also be providing satellite broadband, with Amazon already in talks with government agencies in India.

Regardless of future pricing, individuals can also pre-order Starlink’s services in India at the cost of $99, though connectivity is only expected in 2022.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

SEBI gives more time to brokers, clearing members to comply with rules

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Markets regulator Sebi on Wednesday extended deadlines for complying with certain regulatory requirements by stock brokers, clearing members and KYC registration agencies in view of the ongoing COVID-19 pandemic.

The deadline for maintaining call recordings of orders or instructions received from clients has been extended by one month till July 31, the Securities and Exchange Board of India (Sebi) said in a circular.

Also, the regulator has given time till July-end to brokers for operating the trading terminals from designated alternate locations.

Further, the deadline has been extended till July-end for submission of client funding report.

With regard to issue of annual global statement to clients, Sebi has given relaxation till July 31. This will be applicable only if the client has requested for a physical statement. Earlier these relaxation were given till June 30.

In view of the prevailing situation due to the pandemic and representation received from stock exchanges and depositories, Sebi said it has decided to extend the timelines for compliance with certain regulatory requirements by trading members/clearing members/KYC registration agencies.

As per the norms, KYC (Know Your Customer) application form and supporting documents of clients need to be uploaded on a system of KRA (KYC Registration Agency) within 10 days.

In this regard, Sebi said “till July 31, documents may be uploaded on to the system of KRA within 15 working days”.

A 30-day period after July 31 will be given to registered intermediary to clear the backlog.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Vodafone Idea posts net loss of Rs 7,022.8 crore in Q4

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Debt-ridden telecom firm Vodafone Idea Ltd (VIL) on Wednesday reported a consolidated net loss of Rs 7,022.8 crore for the quarter ended March 2021. In the corresponding quarter last year, the company posted a net loss of Rs 11,643.5 crore.

During the quarter under review, VIL posted gross revenue of Rs 9,607.6 crore, as against Rs 10,894.1 crore quarter on quarter (QoQ). For the year ended March 31, 2021, the company’s loss narrowed to Rs 44,233.1 crore from Rs 73,878.1 crore in 2019-20.

Consolidated total annual income declined by about 8 percent to Rs 42,126.4 crore from Rs 45,996.8 crore a year ago. The gross debt (excluding lease liabilities) as of March 31, 2021, stood at Rs 1,80,310 crore. This comprised deferred spectrum payment obligations of Rs 96,270 crore, AGR (adjusted gross revenue) liability of Rs 60,960 crore, and debt from banks and financial institutions of Rs 23,080 crore.

The subscriber base stands at 267.8 million in Q4FY21, a QoQ decline of 2.0 million. The gross additions continued to improve this quarter as well. Subscriber churn was 3.0 percent in Q4FY21 vs 2.3 percent in Q3FY21. ARPU for Q4FY21 declined to Rs 107 compared to Rs 121 in Q3FY21, on account of the removal of IUC, adjusting for which ARPU was broadly flat this quarter.

“There exists material uncertainty relating to the Group’s ability to continue as a going concern which is dependent on its ability to raise additional funds as required, successful negotiations with lenders on continued support, refinancing of debts, monetisation of certain assets, the outcome of the modification application filed with the Hon’ble Supreme Court and clarity of the next installment amount, acceptance of its deferment request by DoT and generation of cash flow from operations that it needs to settle/renew its liabilities/guarantees as they fall due. As of date, the Group has met all its debt obligations,” it said.

Ravinder Takkar, MD & CEO, Vodafone Idea Ltd, said “FY21 has been a transformational year for Vodafone Idea with several important milestones achieved including the launch of our unified brand “Vi”. In the year of the pandemic, when people and businesses were hugely dependent on telecom connectivity, we delivered superior network experience and improvement in several operating metrics supported by Vi GIGAnet, which remains the fastest 4G network in India, as per Ookla, as well as the network with highest rated voice quality as per TRAI. We enter FY22 with a renewed focus on executing our strategy to keep our customers ahead, and our cost optimization plan remains on track to deliver the targeted savings. We are in active discussion with potential investors for fundraising, to achieve our strategic intent.”

The results came after the close of the market hours. Shares of Vodafone Idea ended at Rs 9.95, down Rs 0.14, or 1.39 percent on the BSE.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Judiciary cannot be controlled or else ‘rule of law’ will become illusory, says CJI

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Judiciary cannot be controlled, directly or indirectly, by the legislature or the executive, or else the ‘rule of law’ would become illusory, Chief Justice of India N V Ramana asserted on Wednesday and at the same time cautioned judges against being swayed by social media.

The new media tools that have an enormous amplifying ability are incapable of distinguishing between right and wrong, good and bad and the real and fake. Therefore, media trials cannot be a guiding factor in deciding cases,” the CJI said, adding it is also imperative to start a discourse as to how social media trends can affect the institutions.

CJI Ramana made the observations while delivering the ’17th Justice P. D. Desai Memorial Lecture’. “For the judiciary to apply checks on governmental power and action, it has to have complete freedom. The judiciary cannot be controlled, directly or indirectly, by the legislature or the executive, or else the rule of law would become illusory.”

At the same time, judges should not be swayed by the emotional pitch of public opinion either, which is getting amplified through social media platforms, the CJI said. He added that the judges have to be mindful of the fact that the noise thus amplified is not necessarily reflective of what is right.

It is therefore extremely vital to function independently and withstand all external aids and pressures. “While there is a lot discussion about the pressure from the executive, it is also imperative to start a discourse as to how social media trends can affect the institutions, he added.

Noting the unprecedented crisis being faced by the entire world due to the COVID-19 pandemic, the CJI said, We necessarily have to pause and ask ourselves as to what extent we have used the ‘rule of law’ to ensure protection to and welfare of all of our people. I began to feel that this pandemic might yet be a mere curtain-raiser to much larger crises in the decades to come. Surely we must at least begin the process of analysing what we did right and where we went wrong, he said.

The CJI added that in a democratic country like India, access to justice forms the bedrock of the rule of law and urged all to extend a helping hand to those in need. However, this guarantee of equal justice will be rendered meaningless if the vulnerable sections are unable to enjoy their rights because of their poverty or illiteracy or any other kind of weakness, he said.

He said that gender equality is very important and legal empowerment of women not only enables them to advocate for their rights and needs in society but also increases their visibility in the legal reform process and allows their participation in it. Bias and prejudice necessarily lead to injustice, particularly when it relates to the minorities, he added.

The CJI said that any law backed by a sovereign must be tempered by certain ideals or tenets of justice. Only a State that is governed by such law, can be said to have the Rule of Law. I would urge both young and senior counsel to extend a helping hand to those in need of justice… Let economy, gender, class or caste never be a hindrance in the path to secure justice, he said, emphasising the need to extend ease of access to justice.

Only when the citizens believe that they have fair and equal access to justice, can we have sustainable, just, inclusive and peaceful societies. “Citizens can strengthen the Rule of Law by being knowledgeable about it and by applying it to their daily conduct and pushing for justice when needed, he said.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Xiaomi to increase prices of phones, smart TVs by 3-6%

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Xiaomi on Wednesday said it will increase prices of its smartphones and smart TVs by about 3-6 percent from July 1 in India as the Chinese tech major faces pressures like shortage of components and higher shipping charges.

A Xiaomi India spokesperson said since the last year, there have been shortages across the supply chain.

“Due to massive demand-supply mismatch, the majority of components used in smartphones, Smart TV and other electronics gadgets (chipsets, display panels, display driver, back panels, battery etc) have seen constant upward movement in their prices,” the spokesperson added.

This, coupled with an unprecedented increase in shipping charges has had an effect on almost all the technology players, including Xiaomi.

“While we have tried to absorb the increasing costs, some of our products have witnessed a price hike. We also foresee an inevitable increase of 3-6 percent in prices of our smart TVs from July 1 onwards,” the spokesperson noted. Prices of smartphones are expected to go up by a similar percentage.

Other players in the LED televisions space are also estimated to have hiked prices by 3-4 percent this month as the cost of panels have gone up in the global market, besides an increase in logistics expenses.

In April too, prices had been hiked due to a rise in operating cost on account of increased ocean freight charges, and domestic transportation costs. TV is one of the largest segments under the entire domain of appliance and consumer electronics. It accounts for a volume of almost 17 million with an estimated sale value of almost Rs 25,000 crore.

According to a joint report by the industry body, CEAMA and Frost & Sullivan, the TV market is expected to grow to 284 lakh units in 2024-25 from 175 lakh units in 2018-19.

Open-cell panel and the chips of the TV are predominantly imported from China besides some other markets such as Taiwan, Thailand, and Vietnam and only the last mile assembly is done in India, as per the report.

In February this year, Xiaomi had announced its partnership with contract manufacturers BYD, DBG, and Radiant to strengthen its ‘Make in India’ efforts. The company had tied up with BYD and DBG for smartphones, while the partnership with Radiant was aimed at augmenting Xiaomi’s capacity of smart TVs in India.

At that time, Xiaomi had five campuses in India, where its partners Foxconn and Flex assemble phones in Tamil Nadu and Andhra Pradesh. It also works with Dixon for making its TVs in India.

Xiaomi India Managing Director Manu Jain had said the company has sold 3 million ‘Made in India’ TVs, and that demand for TVs is going up significantly. He had added that the company is committed to investing in India for the long-term and manufacture not only smartphones and TVs but also components.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Allowing REITs to tap debt markets would bring in more liquidity for listed players: Embassy REIT

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Market regulator SEBI in its board meet made changes to debt market rules and amended infrastructure investment trusts (InvIT) and real estate investment trust (REIT) norms. With regard to debt market rules, issuers other than unlisted REITs/InvITs for less than three years could tap debt markets. The issues must be privately placed via the Electronic Debt Bidding platform (EBP) with qualified institutional placement (QIB) participation. This move is likely to facilitate fundraise by infra SPVs, REITs and InvITs.

The minimum holding of unitholders, other than sponsors, have been set at 25 percent. For REIT, the minimum application value will be Rs 10,000 to Rs 15,000, down from Rs 50,000. Moreover, the revised trading lot shall be one unit, according to the changes introduced by SEBI.

Throwing light on the new rules, Mike Holland, CEO of Embassy REIT said, “The option to look at foreign portfolio investors subscribing to our bonds broadens the capital that is available to us. This could further bring down the cost of debt for the company.”It would be good for the company as well as investors, he added and said that it would be a positive move.

Holland also referred to the reduction of the minimum application value to Rs 10,000 to 15000 as positive. He explained that it is a multiplier effect. “When we listed, we had 4,000 unitholders, today we have 12,000 but there was a limitation in minimum lot size. It has been Rs 50,000 but going forward, now effectively one can trade that one unit,” he highlighted.

The Embassy REIT’s CEO said that the move would result in more liquidity for a stock like theirs.”We have got a very strong balance sheet already by bringing down the cost of debt by another 300 basis points,” Holland said. He added that this would help them grow the business faster and return more to unitholders.

Watch the video for more.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow