News As We Read - 20thAug '13

Thought of the Day:

Did you know?

FOLLOWING MADE THE HEADLINES:

India:

• Govt slaps 10% import duty, 12.5% CVD : Indian travellers returning home will now have to pay Customsduty on TVsetsthey buy overseas. The government on Monday slapped a 10% Customs duty and 12.5% countervailing duty on such imports, as part of its efforts to discourage import of nonessential items and reduce the current account deficit that has put enormous pressure on the rupee. Till now, travellers could bring a TV set worth . 35,000 with them without having to pay import duty. This had resulted in Thailand, Dubai, Singapore and Malaysia becoming attractive shopping destinations.

• Aishwarya Rai to Endorse Lodha’s Worli Project : Realty developer Lodha Group has roped in actor and former Miss World Aishwarya Rai Bachchan as brand ambassador for its 17.5-acre premium project The Park in central Mumbai’s Worli. Apart from being associated with the project as her latest assignment, the actor has bought a 4-bedroom apartment in the project for more than 5 crore. The developer had earlier done a soft launch of the same project under codename Blue Moon in January. On Monday, Lodha unveiled the master plan for the entire project that will be developed around a landscape garden spread over 7 acres. The project with total development potential of 4 million sq ft will be developed over the next 5-7 years. Lodha had bought the land parcel from DLF in 2012 for around 2,725 crore. “We sold apartments worth 3,500 crore during our pre-launch offer for the first two towers. Around 30% of these buyers were NRIs. We expect around 20% of buyers in this entire project to be from this segment,” said Abhisheck Lodha, MD, Lodha Group. According to Lodha, the company realised around 28,000 per sq ft through bookings launched for first two towers in January. The company is planning to invest around $1 billion for the entire development of the project that has total revenue potential of over 18,000 crore, he said.

• Hero Tunes into Music for Youth Connect : Hero MotoCorp, which exited all cricket sponsorships including the Indian Premier League earlier this year, is now betting on music to connect with the youth. The top two-wheeler maker will be presenting sponsor for Sunburn, Asia’s biggest music festival, this year. Media buyers say Hero has coughed up . 7-10 crore for the seventh season of the music festival promoted by entertainment and talent management firm Percept. This is the highest sponsorship deal for Sunburn so far. Shailendra Singh, joint managing director at Percept, and a Hero MotoCorp spokesperson confirmed the association, but declined to divulge spends and other details. “Sunburn music festival has become very popular with the youth,” the Hero spokesperson said. “We will soon share the details of our partnership with this event.” Singh said Sunburn’s global scale and youth connect has accelerated corporate interest in the festival. Apart from Hero, other sponsors include Pernod, Tuborg, Budweiser and Kingfisher all known as liquor brands besides energy drink Red Bull and PepsiCo’s lime drink 7 Up. “Sunburn is contributing to music tourism, which is a new global phenomenon,” he said.

• Saad Abdul-Latif, PepsiCo Asia Chief, Passes Away : Beverage and snacks maker PepsiCo on Monday announced the sudden death of its CEO of Asia, Middle East and Africa (AMEA) region. PepsiCo chairman and CEO Indra Nooyi said in a statement: “Saad Abdul-Latif was much more than a business leader. He was a deep personal friend to many PepsiCo family members in every corner of the globe.” PepsiCo said in the statement that effective immediately, Umran Beba, in addition to her current responsibilities as SVP and chief human resources officer for PepsiCo AMEA, will serve temporarily as acting sector head for the region until a permanent replacement is announced. After the exit of India chairman Manu Anand in June this year, PepsiCo's beverage and foods CEOs Gautham Mukkavilli and Praveen Someshwar were reporting directly to Saad.

• Reebok Ropes in Nargis Fakhri as Fitness Ambassador : Reebok has signed up Bollywood actor and fitness icon Nargis Fakhri as its women’s fitness ambassador. Fakhri will represent the brand for their ‘Studio’ category, a unique and innovative line of products focussed on dance, aerobics and yoga designed especially for the women consumers. Talking about the association, Erick Haskell, managing director, Adidas Group India, said, “Reebok is committed to making fitness aspirational and fun and Nargis Fakhri is the perfect embodiment of this”.

• Top 10 Business Groups’ Debt Rises 15% to . 6.4 trillion : The country’s 10 leading business houses, including Reliance Group, Vedanta, Essar and Adani, have seen their total debt levels soar by 15% to over . 6 lakh crore during the last fiscal while profitability continues to remain under pressure, a research report said on Monday. The cumulative debt of these groups, which also include Jaypee, GMR, GVK, JSW, Lanco and Videocon, is likely to further increase in the current fiscal because of rupee depreciation and delays in projects being undertaken by many of them, Credit Suisse said its annual House of Debt report for India. According to the report, the collective debt of these 10 groups rose to . 6,31,025 crore at the end of last fiscal ended March 31, 2013, from . 5,47,361 crore a year ago.

• Rolls Royce launches Wraith in India at Rs 4.6 crore : Ultra luxury car maker Rolls Royce today launched its 'Wraith' model with a price starting at Rs 4.6 crore in India, as part of its expansion plans in the country.  The company, which currently sells Phantom and Ghost models in the country, is also looking to expand its dealerships here. "We believe there is immense potential in India market. In 2005 we started with one dealership. To cater to different regions, we will be opening two more dealerships this year, taking the total number to five," Rolls Royce, General Manager Emerging Markets Asia, Herfried Hasenoehrl, told reporters here. The two new dealerships would come up at Chandigarh and Ahmedabad, he added. The company, which sold 3,575 cars globally last year, has dealerships currently at Delhi, Mumbai and Hyderabad. When asked about the company's growth plans in India, Hasenoehrl said that in order to reach out to more customers, Rolls Royce might open two more dealerships in the country next year.

International:

• FB bug-spotter hacks Zuckerberg’s wall : To prove that social media giant Facebook has a security flaw that can allow people to post on someone’s wall without being in their friends’ list, a security researcher went a step ahead and posted a bug on the CEO’s wall. Khalil Shreateh from Palestine initially tried to report the bug to Facebook’s security team before posting something on the wall of Sarah Goodin, a friend of Facebook CEO Mark Zuckerberg, but he was not taken seriously. Shreateh then used the bug and posted a message on Zuckerberg’s wall and explained about the flaw. I prompted immediate action, and within minutes the site’s security engineer contacted him and asked for the details. Facebook has a bounty programme where it pays people to report bugs instead of using them maliciously. However, it did not pay the $500+ fee amount to Shreateh because it cited him violating the site’s terms of service, although, it asked him to continue to help it find bugs. Facebook said it appreciated help with security but not by hacking into user accounts.

• Nestle's sales slowdown seen leading to fewer brands : Nestle SA, the world’s biggest food company, needs to reignite sales that have disappointed investors for four straight quarters. One solution Get smaller. The maker of Nescafe coffee and DiGiorno pizza said August 8 that it’s “actively looking” at its 8,000 brands and is seeking to identify the laggards after posting its weakest quarterly revenue growth in four years. Nestle has said it will struggle this year to meet its long- term forecast for annual sales growth of five per cent to six per cent, hurt by a deceleration in emerging markets, European weakness and sluggish performances from its diet products, water and frozen entrees. The slowdown increases the urgency for Chief Executive Officer Paul Bulcke to tackle underperforming areas, especially as his peers get leaner. Unilever, whose ice creams and soups compete with Nestle’s, has raised more than $ 1 billion selling assets this year to focus on fastergrowing shampoos and deodorants, and CEO Paul Polman has said there is more to come. Kraft Foods Inc and Sara Lee Corp have both split in two, and Campbell Soup Co is in talks to sell much of its European unit. “We’re talking surgery, not amputation,” Thomas Russo, a partner at Gardner Russo & Gardner and a Nestle investor since 1987, said in a phone interview.

• Amazon.com website goes offline : Visitors to the US shopping site were greeted with a message saying: "Oops! We're very sorry," alongside a "500 Service Unavailable Error" report. The site returned online about half an hour after the problem was first flagged by users of the news site Reddit. Amazon could not be reached for comment at this time. The firm's UK site was not affected by the issue, however its Canadian home page also showed an error message. The support section of Intel's website and some pages which are only accessible to the computer chip-maker's staff also became unavailable for a period on Monday. A spokeswoman said this was due to an "internal issue" and it was a coincidence that it had occurred shortly after Amazon's problem. It follows Google's two-minute downtime on Friday. That affected the firm's main search page as well as its Gmail email service, YouTube video site and Drive storage product. Analytics firm GoSquared reported the fault caused a 40% dip in worldwide internet traffic. Google has not explained the cause. Microsoft's Outlook.com and the New York Times website have also faced problems Microsoft blamed a three-day-long disruption to its email product on a failure in its "caching" temporary storage service. It said this "resulted in a flood of traffic that our services did not handle properly".

• Property website Zillow buys StreetEasy for $50m : Property listing website Zillow has bought New York City-focused StreetEasy for $50m (£32m). The company said the acquisition was an effort to enter one of the most lucrative US housing markets. "StreetEasy is an incredibly strong and recognised brand in New York City," said Zillow boss Spencer Rascoff in a statement. "Simply put, StreetEasy has cracked the code in New York." The company also announced a public offering of 2.5 million shares.

• Urban Outfitters Posts Record Q2 Net : Urban Outfitters Inc. on Monday reported record second-quarter net income and admitted it’s on the hunt for acquisitions. The retailer had net income of $76 million for the three months ended July 31 and net income of $123 million for the six months ended July 31. Earnings per diluted share were 51 cents for the three months and 83 cents for the six months. Total company net sales for the second quarter rose 12 percent over the same quarter last year to $759 million. Comparable retail segment net sales, which include the comparable direct-to-consumer channel, increased 9 percent. Comp retail segment net sales jumped 38 percent at Free People, 9 percent at Anthropologie and 5 percent at Urban Outfitters. Wholesale segment net sales rose 17 percent. “There’s enormous growth potential in the Asian market, especially China and Hong Kong,” said Richard Hayne, chief executive officer.

• Wal-Mart to Hold U.S. Sourcing Summit : Wal-Mart Stores Inc. isn’t giving up on its Made in America pledge, and on Thursday will host a U.S. Manufacturing Summit at the Orange County Convention Center in Orlando, Fla. The retail giant in January committed to sourcing $50 billion worth of goods in the U.S. over the next 10 years. It continues to appeal to other retailers to participate as it tries to line up support from businesses across a variety of industries, and reaches out to the federal and state governments. The blueprint is similar to other Wal-Mart initiatives such as the sustainable index the retailer introduced in 2009. Wal-Mart created a coalition between retailers, manufacturers, government, nonprofit organizations and academia for the index, which measures key performance indicators and category-specific metrics to evaluate a retailer’s performance and supply chain performance.

• Retail Stocks Extend Losses : Retail stocks extended their losing streak to four-straight trading sessions today as investors continued to get signs that the consumer hasn’t been as strong as they expected. The minutes from the Federal Reserve’s last meeting also fueled speculation policy makers will trim bond buying. The S&P 500 Retailing Industry Group fell 0.1 percent, or 0.76 points, to 811.60, as the Dow Jones Industrial Average declined 0.5 percent, or 70.73 points, to 15,010.74. Saks Inc. said second-quarter comparable-store sales increased 1.5 percent  a disappointment since in May the retailer projected comps would range from gains of 4 percent to 6 percent for the balance of the year. Shares of Saks, which is slated to be taken over by Richard Baker’s Hudson’s Bay Co. for $16 a share, slipped 5 cents to $15.97. The company is in the midst of a 40 day go-shop period when it can try to drum up other offers.

Currency:

Glitter Meter: India

World Indices: