Twist pe twist, Jio’s aggression, job reservation for locals and other news
Business news and insights in under 5 minutes.
“Leaders must be close enough to relate to others, but far enough ahead to motivate them.”
- John C Maxwell
Rise and shine! 😀
In today’s edition, we take a look at:
The lifeline Future Group declined
Jio’s aggression
Rich get richer
Let’s get started…
📈 How did the markets fare
BSE Sensex - 50,296.89 | +0.90% ⬆
NSE Nifty - 14,919.10 | +1.07% ⬆
10-Yr Bond Yield - 6.236% | +0.027 ⬆
S&P 500 - 3,870.29 | -0.81% ⬇
USD/INR - ₹ 73.35 | +0.25% ⬇
Shares of Shipping Corporation of India jumped 20% to its highest level in 10 years, after a government official said they had received multiple expressions of interest for its proposed privatisation. The government is planning to divest its 63.75% stake in the company.
Brace yourself. At least seven IPOs worth Rs 12,000 crore are set to hit the primary market over the next month and it’s starting today with that of MTAR Technologies. The precision engineering company is looking to raise Rs 597 crore.
📰 What's happening around us
Retail
It was easy to see Amazon as the villain in the whole Amazon-Future-Reliance drama that is playing out now. Future Group said that the American e-commerce giant refused to help when the debt-laden retailer was struggling to stay afloat. Then, when Reliance came to the rescue, Amazon blocked the deal putting 29,000 jobs at risk. But a new Mint report throws light on how Amazon tried to help the struggling retailer before Future Group decided to go with rival Reliance.
Amazon reportedly proposed an infusion of Rs 6,000 crore from a host of investors including itself in early 2020 and worked with the group to improve cash flows and avoid default by selling Future Group products on Amazon. It also proposed another plan, which included the sale of some retail assets to reduce debt and using the cash to improve its other businesses. However, Future Group eschewed both proposals to enter into a Rs 24,713-crore agreement with Reliance Retail.
Future Group denied there were any such proposals. But if we were to take at face value, this new information and Amazon’s claim that it had a deal with the group that prevents selling shares of Future Retail to rivals in the retail space, you can see why Amazon feels aggrieved.
Telecom
With mobile tariffs at unsustainably low levels and huge expenditure required for the spectrum auctions and payment of AGR dues, an increase in prices were imminent. But Reliance Jio’s decision to announce two new offers aimed at attracting new low-end users and retaining existing customers could delay the tariff hikes in the industry.
The plans priced at Rs 1,499 and Rs 1,999 for one year and two years respectively offer a JioPhone handset, unlimited calling and 2 GB data per month. This comes at a time when Jio’s net subscriber additions have slowed to 7 million a quarter this financial year, down 65% from the 20 million it added every quarter in the previous financial year. Even Airtel had outpaced it in recent months.
Jio, with its deep pockets, can afford to delay tariff hikes but it’s a major blow for Vodafone Idea. It’s a precarious situation for the struggling telco which continues to lose subscribers. The current rates are unsustainable but an increase now could mean losing even more subscribers.
Wealth
2020 was no ordinary year. But, it was a year of extraordinary gains for the global elite. While most of the world reeled under the economic impact of the pandemic, the total wealth of all billionaires across the globe surged 32% to $14.7 trillion in 2020, as per the 10th Edition of Hurun Global Rich List.
Topping the list was Tesla’s Elon Musk with $197 billion in net worth, followed by Amazon’s Jeff Bezos ($189 billion) and LVMH’s Bernard Arnault ($114 billion). With $83 billion, Reliance Industries' Mukesh Ambani was the richest in India, second richest in Asia and the eighth richest in the world, making him the only Indian to make it to the top 10.
Here are some interesting facts:
India is home to 177 billionaires, making it the third-highest in the world.
Additionally, there are 32 Indian-origin billionaires across the world.
India added 40 new billionaires last year.
Average age of billionaires in India is 66 years.
Here’s the Global and India top 10 list.
🎯 News Bites
India raised almost Rs 78,820 crore in its first telecom spectrum auction in five years with Jio emerging as the top bidder. Jio acquired radiowaves worth Rs 57,122 crore whereas rivals Airtel picked up Rs 18,699 crore and Vodafone-Idea acquired just Rs 1,993 crore worth of spectrum.
Haryana has passed a bill that will require private companies to reserve 75% of all jobs for locals. All jobs with a monthly starting salary of below Rs 50,000 come under the ambit of the Haryana State Employment of Local Candidates Bill, 2020.
IPO-bound e-commerce player Flipkart is expanding its footprint in the fast-growing grocery segment. The grocery business is being expanded to 70+ cities in the next 6 months from its existing 50 cities.
India is wooing Tesla. Transport Minister Nitin Gadkari said that his government is willing to offer incentives to ensure Tesla’s cost of production would be less than in China if the carmaker sets up manufacturing in India.
Swedish automaker Volvo is jumping on the all-electric bandwagon. Come 2030, the company plans to phase out all its diesel, petrol and hybrid options to sell only electric cars.
READER OPINION: Like Haryana, do you think states should reserve a percentage of all private jobs for locals? Comment below.
That's all for today. Have a great day!