Tata Group will buy a 68% stake in online grocery startup BigBasket for about Rs 9,500 crore. Amazon will begin making devices in India for the first time. Bharti Airtel Ltd said it will buy Warburg Pincus’ 20% stake in its direct-to-home TV arm. Here is more news from this week.
- Amazon will begin making devices in India for the first time, joining a flock of technology companies setting up manufacturing operations in the country. The US e-commerce giant will start making the devices via a subsidiary of its manufacturing partner Foxconn Technology Group and production will start later this year in its facilities outside Chennai, the company said in a blog post.
- Tata Group will acquire a 68% stake in online grocery startup BigBasket for about Rs 9,500 crore. The deal values BigBasket at Rs 13,500 crore and is expected to close in five weeks. BigBasket top management, including co-founder Hari Menon, will stay on board as investors Alibaba, Abraaj Group and IFC exit the firm.
- The government will buy some e-commerce firms after complaints from small retailers, said Minister of Commerce and Industry Piyush Goyal, adding the companies have to "correct their business practices at the earliest" if they were found flouting Indian laws. "There is no change in e-commerce policy per se," he said.
- India’s market regulator eased listing norms for large companies, helping the government to sell a part of its stake in the Life Insurance Corporation through a mega initial public offering (IPO). The Securities and Exchange Board of India said large companies can now divest a minimum 5% in the IPO, instead of 10%. They will get five years, instead of three, to raise the public float to 25 per cent.
- Bharti Airtel Ltd said it will buy US private equity firm Warburg Pincus’ 20% stake in its direct-to-home television arm for Rs 3,126 crore. Airtel announced setting up a committee to evaluate options for reorganising its businesses and shareholding structure, as the company sharpens focus on its digital and non-telecom businesses.
- Stressed assets of Indian non-bank financiers and mortgage lenders may touch at least Rs 1.5 trillion or 6-7.5% of their total assets under management by the end of FY21 due to the coronavirus pandemic’s impact, said rating agency Crisil. Real estate is likely to suffer the most, followed by unsecured loans.
- The government is considering lifting the blanket suspension of the Insolvency and Bankruptcy Code (IBC) to accelerate resolving stressed assets. Fresh proceedings under the IBC are suspended till March 24. A senior civil servant told Business Standard the government is considering two options: resuming resolutions in view of rising defaults, or bringing in some provisions to the IBC to deal with distressed sectors.
- The Securities Appellate Tribunal (SAT) has stayed the order passed by market regulator Sebi, that had put a one-year ban on Future Retail chairperson Kishore Biyani and some other promoters from the securities market. SAT has also directed the Future Group promoters to deposit Rs 11 crore as an interim measure.
A few links for further reading
Hard path to growth
The signals for the economy are not positive: overall demand is yet to pick up; the share of total exports in India’s GDP is declining, and industrial output pattern remains worrying.
Small savings scheme
Investors breathed a sigh of relief when the government announced that interest rates on these instruments would not be revised for the fourth quarter of the calendar year.
Invest and emigrate
The great Indian dream of settling abroad is achievable if one has a few crores to invest. Rich nations offer a variety of investment options in a quid pro quo arrangement: immigrants get a better quality of life and revenue from them helps these countries’ finances. Wealthy Indians, troubled by polluted cities and the red tape holding up entrepreneurship, may want a quick ticket out of the country. Sanjay Kumar Singh lists a range of options: from a Canadian province’s investor programme to America’s US EB-5 plan.