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QBiz: Alibaba Looks to Focus on Small Deals in India & More

1. Alibaba Looks to Focus on Small Deals in India

Alibaba Group Holding Ltd is reviewing its India investment strategy that could see the Jack Ma-led Chinese e-commerce giant take a more judicious approach by making more vertical e-commerce investments and smaller early-stage deals, three people aware of the matter said.

The potential shift in strategy follows Alibaba’s disappointments at some of its large e-commerce bets such as online retailers Snapdeal and Paytm Mall, which have widely lagged behind the e-commerce market dominated by Flipkart and Amazon. The Economic Times reported on 22 April that Paytm Mall’s deep discounting strategy and an annual loss of Rs 1,787 crore made Alibaba realise that Paytm’s volumes, driven largely by cashbacks, would not make it a sustainable business.

(Source: Livemint)

2. Early Q4 Earnings Point to a Slowdown in Economy

Early March quarter earnings indicate that the Indian economy has slowed and the much-awaited revival in earnings growth may be delayed further, developments that are likely to deepen investor unease about stock valuations and a more than two-month-old stocks rally.

A Mint analysis showed that slower sales have dragged profits of companies that reported earnings for the quarter ended 31 March to the slowest in at least 13 quarters even as BSE’s benchmark Sensex has climbed more than 8 percent in the past two months.

Aggregate net profit growth of 124 BSE-listed companies that reported March quarter earnings fell 8.42 percent from a year earlier after adjusting for one-time gains or losses, according to data provider Capitaline. Profit grew 7.54 percent in the preceding three months.

(Source: Livemint)

3. Reliance Industries Looks to Strengthen Petrochem Business

Reliance Industries (RIL) is focusing on new business-to-customer initiatives to hedge against volatility and strengthen its petrochemicals business.

Under this strategy, RIL will offer end-to-end tailor-made solutions to industries to manufacture windmills, design complete railway compartments in three years, build underground tanks with a shelf life of 25 years against the present 7-8 years, replace wood with composite material in home decor, make fire redundant fabric for curtains and design poles with composites for the telecom sector, among others.

In an analysts presentation to discuss March quarter results, RIL said it is adopting a strategic shift towards the consumer and diversifying into the production of chemicals using three major philosophies– investing in new-age technology and raw materials, moving from selling products to selling complete solutions and adopting digital technology.

(Source: Livemint)

4. Trump Threatens to Raise Chinese Tariffs to 25% This Week

President Donald Trump turned up the pressure on China on Sunday, threatening to hike tariffs on USD 200 billion worth of Chinese goods. Trump's comments, delivered on Twitter, came as a Chinese delegation was scheduled to resume talks in Washington on Wednesday aimed at resolving a trade war that has shaken financial markets and cast gloom over the world economy.

Trump turned up the heat by saying he would raise import taxes on USD 200 billion in Chinese products to 25 per cent from 10 per cent on Friday. He's twice pushed back deadlines — in January and March — to raise the tariffs in a bid to buy more time for a negotiated settlement.

But on Sunday, Trump, who has called himself a "tariff man," said he's losing patience. "The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!" Trump tweeted .

The two countries are locked in a high-stakes dispute over China's push to establish itself as a technological super power.

(Source: AP)

5. Foreign Investors Have Good Appetite for InvITs, Says India INC

With private equity player KKR becoming a co-sponsor in the India Grid Trust InvIT (infrastructure investment trust) over the weekend, Reliance Jio transferring fibre and telecom assets to two InvITs, and Brookfield’s India Infrastructure Trust investing in a gas pipeline, this specialised investment vehicle is in the spotlight.

InvITs, first allowed in 2016, are seen as good option for infra firms to hive off specified assets into a special purpose vehicle, which will get the benefits of owning the asset.

(Source: Business Standard)

6. Govt Sees Little Scope for Jet Airways' Revival: Sources

India's government sees little hope of a bidder emerging for debt-laden Jet Airways Ltd, two senior finance ministry officials said, even as thousands of employees plead with the government for a rescue.

Parties that had initially expressed interest in Jet, which is saddled with roughly $1.2 billion of debt, have so far failed to make firm bids to bail it out, increasing the odds that it could soon face bankruptcy proceedings.

"There is little scope in the revival of Jet," said one official, adding that if a bidder emerged, the government was still willing to return slots to the private airline which have temporarily been given to rivals.

(Source: Livemint)

7. Healthcare Industry Shows Increased Affinity for Hybrid Cloud

The healthcare industry is increasingly leaning toward adopting hybrid clouds that combine private and public cloud services, and their respective benefits — with healthcare ranking third in the number of hybrid cloud deployments currently running, by industry. According to a report by Nutanix, an enterprise cloud computing firm, in just two years, healthcare providers’ hybrid cloud deployment will jump from 19 percent penetration to 37 percent.

Investing in next generation IT infrastructure is the first step in preserving the current quality of care and bringing healthcare to the individual rather than the other way around, says Neville Vincent, vice-president ANZ, ASEAN and India, Nutanix.

(Source: Financial Express)

8. Aditya Birla Capital to Raise $300 Million via ECBs in FY20

Aditya Birla Capital Ltd (ABCL) is proceeding with plans to raise up to $300 million through external commercial borrowings (ECBs) in the current financial year even as non-banking financial companies continue to battle a liquidity squeeze.

ABCL CEO Ajay Srinivasan said the financial institution remains unaffected by the ongoing liquidity crisis and has a strong fundraising opportunity. The holding company ABCL has already secured board approval to raise up to ₹3,500 crore through both equity and debt this year.

“We are looking to raise around $250-300 million for the non-banking finance company (NBFC) and $100 million for the housing finance company (HFC),” Srinivasan told Mint.

ABCL’s plans follow close on the heels of the credit rating downgrade of housing finance companies which has raised fears of another liquidity crisis. This was just as the NBFCs were starting to recover since the Infrastructure Leasing & Financial Services (IL&FS) crisis broke out last September.

(Source: Hindustan Times)

9. SBI Card Raises ₹700 CR From Banks, Parent

SBI Card raised ₹700 crore from several financial institutions including its parent State Bank of India (SBI) in the second half of FY19 as it aims to grow above the industry average.

SBI Cards and Payment Services Pvt. Ltd (SBI Card) raised ₹100 crore from ICICI Securities Primary Dealership Ltd, ₹250 crore from State Bank of India and ₹50 crore each from Canara Bank and Axis Bank by issuing non-convertible debentures (NCDs) at 9.15 percent coupon, documents available with the Registrar of Companies (RoC) seen by Mint showed. The company also raised another ₹250 crore from Axis Bank through a coupon of 9.55 percent.

(Source: Hindustan Times)

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