News As We Read - 29th Aug'13

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India:

• AAI puts SpiceJet on cash-and-carry : In a rerun of the Kingfisher crisis, increasing costs thanks to the falling rupee have again made Indian airlines’ struggle to continue operations. State-run Airports Authority of India (AAI) has decided to put SpiceJet on cashand-carry after the low cost carrier’s (LCC) dues reportedly crossed its bank guarantee and were not cleared despite reminders from AAI. The authority has also warned Jet Group to keep its dues within bank guarantee limits or else it too may be denied credit. “SpiceJet will be on cashand-carry from Friday (August 30),” AAI chairman V P Agrawal said. Being denied credit by AAI hurts airlines immensely as the PSU provides air traffic services across Indian airports, including the private metro ones. Five private airlines, including those which have stopped flying like Kingfisher and Paramount, owe Rs 357 crore to AAI. 

• TITAN CHANGES NAME, TO MAKE PERFUMES : India’s leading watch, jewellery and eyewear maker Titan is set to make helmets, managing director Bhaskar Bhat said. The company on Wednesday unveiled its new corporate identity by rechristening itself as Titan Company Limited.

• AirAsia India appoints director of flight ops : Low cost carrier AirAsia India on Wednesday announced two more key appointments director of flight operations and head of engineering. “We are proud to have Amit Singh as director of flight operations and G Sampath as head of engineering on board,” AirAsia India chief executive Mittu Chandilya said in a release.

• Sweet- tooth Indians leave a bitter taste in sugar free sellers’ mouths : If you thought Indian consumers are lapping “ sugar- free” food products, think again. Leading food companies, which had launched sugar- free products in beverages, ice creams, chocolates and biscuits, hoping to cash in on a growing number of health conscious consumers, now say demand for such products is miniscule and the magic market for health products is turning out to be a myth. Sugar- free products, present in the market for four- five years, account for around ₹ 400 crore in the ₹34,000- crore food products market ( beverages, juices, chocolates, biscuits and ice creams). In soft drinks, for instance, Coke executives say the share of diet products is less than one per cent of the total carbonated drinks market. More important, experts say its share in the total volume of carbonated beverages is actually coming down, simply because it is growing slower than the category.

• Bharti Airtel appoints new CEO to shore up Africa operations : Bharti Airtel, which operates across 20 countries in Asia and Africa, on Wednesday said it had appointed Christian de Faria as chief executive officer (CEO) for the company’s Africa operations, with effect from January 1, 2014.Manoj Kohli, managing director & CEO ( International), in charge of the company’s operations in Africa, Bangladesh and Sri Lanka and currently stationed at Airtel Africa’s headquarters in Nairobi, would relocate to India, with effect from January 1, Bharti Airtel said in a statement, on Wednesday. Faria, who would join Airtel Africa on September 16 this year, would initially take charge of Airtel’s Anglophone ( English speaking countries) operations and would commence a comprehensive orientation encompassing Airtel Africa HQ functions, Francophone and Nigeria regions. Faria would be based in Nairobi and would report to Kohli. Besides continuing to oversee Bharti Airtel’s businesses in Africa, Bangladesh and Sri Lanka, Kohli would lead strategic issues such as in- market consolidation via merger and acquisitions, business development, key matters relating to tower company, global partnerships, global sourcing from key partners and strategic regulatory aspects. Kohli would continue his position on the boards of Bharti Airtel International Netherlands and Airtel Networks Ltd, Nigeria.

• Pantaloon to wear a new look : antaloon Fashion and Retail (Pantaloon) is set for a refreshed look and reshuffled portfolio as its new promoter, Kumar Mangalam Birla, plans to spend ₹ 150 crore to expand and renovate the multi- brand apparel retail chain this financial year. The $ 40- billion- turnover Aditya Birla Group had announced its acquisition of a controlling stake in debtladen Pantaloon Retail’s fashion business last year in a ₹ 1,600- crore deal. Aditya Birla Nuvo ( Nuvo), the diversified conglomerate of the Birla group, which also has a thriving branded apparel business in Madura Garments, finally got the reins of Pantaloon’s fashion business this April, after its demerger from the retail empire of Kishore Biyani. “It were stretched financially as the debt structure was very high, so it could not invest in the look and feel, and that has actually affected the business,” says Rakesh Jain, managing director, Aditya Birla Nuvo. Pantaloon reported a net loss of ₹ 57 crore in the quarter ended June, while clocking ₹ 344 crore in revenue.

• India 2nd to US in Facebook data access requests : During the first six months of this year, the Union government sought information about 4,144 users of popular social networking site Facebook, putting India second on the list of countries in terms of the number of details sought, after the US. Between January and June, the government sent 3,245 requests to Facebook, of which half were complied with, the networking site said in its first transparency report. The US had sent 11,000- 12,000 requests, seeking information on 20,000- 21,000 users. While technology giant Google has brought out transparency reports for the last couple of years, revelations on the US government’s surveillance programme, PRISM, have prompted other technology firms such as Facebook to follow suit. 

International:

• Twerking gyrates its way into Oxford dictionary : Twerking, selfie, fomo know what they mean? No? Chances are you still haven’t moved bag and baggage to the virtual world. Twerking, the raunchy dance that has gone viral since Miley Cyrus performed at the MTV awards, is one of the new terms to make the latest Oxford dictionary update. Arising in the early 1990s, it is described as “a dance to popular music in a sexually provocative manner involving thrusting hip movements and a low, squatting stance”. Selfie, digital detox and hackerspace are also among the new additions. Fomo (fear of missing out) – perhaps the biggest anxiety afflicting the digital generation shares space with Bitcoin, the nationless e-currency whose gyrations have also caught the world’s eye.

• Nissan’s 2020 target-cars sans drivers : Japanese vehicle manufacturer Nissan Motor Co. is reportedly going to develop ‘driverless’ cars by 2020. Nissan’s chief executive Carlos Ghosn had earlier said that he wants the company to be the first to sell self-driving cars but his announcement of the same at an event in California testified the company’s plans. The company aims to have a commercially viable autonomous driving system in multiple vehicles by 2020 at a reasonable price.

• Two Taiwan cos bag orders for Apple iwatch : Two leading Taiwanese electronics firms that assemble products for Apple have received orders to make the highly anticipated ‘iWatch’. “Apple is likely to introduce ‘iWatch’ in 2014. From our channel checks, Inventec is the major assembly source with about 60% of order allocation,” said CIMB Securities analyst Wanli Wang in a report on Wednesday. CIMB projects 63.4 million units of ‘iWatch’ shipments in the year after its launch with an average price of around $199, while the project itself is estimated to contribute 19% of Inventec’s earnings in 2014.

• Nestle chairman says will not extend purchase contractwith L’Oreal : Nestle wants to keep its options open for its stake in cosmetics firm L’Oreal and will not extend a purchase contract with France’s Bettencourt family, the food group’s chairman told a Swiss newspaper. The Swiss company owns a 29.5 per cent stake in L’Oreal and the expiry of a 10- year right of first refusal agreement with the Bettencourt family in April 2014 would make it easier for Nestle to sell. “The right of first refusal will not be extended, that is clear,” Peter Brabeck told the Handelszeitung newspaper, in an excerpt of an interview published on its website on Wednesday.

• Chinese shoppers set to become world leaders online : Chinas e- commerce market is expected to leapfrog that of the United States this year to become the worlds largest by total customer spending, management consultancy firm Bain &Company says. Online spending could account for half of all Chinese retail spending within a decade, according to Chinese e- commerce firm Alibaba Group. The change in shopping habits comes as almost half of the countrys 1.3 billion population now have direct access to the Internet, and of that number nearly 80 per cent own smart phones or tablets. Chinas e- commerce market has grown at an average rate of 71 per cent from 2009 to 2012, versus 13 per cent in America, and its total size is expected to reach 3.3 trillion yuan ($ 539.07 billion) by 2015, Bain & Company said in a report released on Wednesday. Total spending by Chinese consumers on online shopping reached $ 212.4 billion in 2012, compared to $ 228.7 billion in the US, the report said.

• Wal-Mart offers same sex partners to get health benefits : The world's largest retailer has about 1.3 million staff in the US, although the company said it did not know how many would use the benefits. Wal-Mart's move brings it into line with many other big US firms that have already begun extending such benefits. In June, the Supreme Court ordered the US government to recognise same-sex marriages in states where it is legal. "We have chosen to offer benefits to an associate's same- or opposite sex spouse, or to an unmarried partner, whether of the same or opposite gender," said Wal-Mart spokesman Randy Hargrove. Unmarried partners, whether same sex or opposite, are covered if they live together in an ongoing exclusive committed relationship similar to marriage and have been together for at least 12 months, and they intend to continue sharing a household indefinitely."

• Billabong reduces the value of its brand to zero : It reported a net loss of A$859.5m ($777.8m; £495.1m) for the year ending 30 June, compared with a loss of A$275.6m a year ago. It has written off the value of many of its brands, including cutting the value of the Billabong brand to zero. Its shares fell as much as 15%, having lost more than 60% in the past year. Billabong has been struggling to maintain sales in key markets such as the US and Europe. "They have had an absolutely ginormous writedown, and that's the only way that you can describe it," said IG Markets analyst Evan Lucas. The firm has also been in financial trouble after an international expansion loaded the company with debt.

• Retail Stocks Up 0.5% on Wall Street : Wall Street ended with modest gains today as investors kept their eyes on increasing geo-political tensions over the conflict within Syria. The S&P 500 Retailing Industry Group rose.

• Guess Shares Lifted by Q2 Results : Guess Inc. bounced back into the good graces of the investment community with second-quarter earnings that fell far less than expected. Digesting the positive news about the quarter, which was highlighted by improvement in the company’s North American retail operations and in Europe, shares jumped more than 18 percent in the early stages of after-hours trading. Net income for the three months ended Aug. 3 dropped 7.1 percent to $39.9 million, or 47 cents a diluted share, from $42.9 million, or 47 cents, in the second quarter of 2012. Excluding restructuring charges principally related to European operations, earnings per share were 52 cents, fully 16 cents above the 36 cents expected, on average, by analysts.

• Seize sur Vingt Opens Hollywood Store : Seize sur Vingt is bringing a dash of New York style to Los Angeles men. The 15-year-old brand, known for its custom suits, will open its second store, and first on the West Coast, on Sept. 3 at 8618 Melrose Avenue in West Hollywood. The 1,100-square-foot store comes two years after Seize sur Vingt set up an in-store shop at Ron Herman to test the Los Angeles market.

• H&M's Largest Store Set for Herald Center : Call it the battle of the biggest. Across from Macy’s, the World’s Largest Store, H&M is building the Largest Store in Its Global Fleet. H&M’s 63,000-square-foot space will be a fraction of the Macy’s Herald Square flagship’s 1.2 million square feet. But H&M’s four-level flagship at Herald Center, bowing in fall 2014, will be unlike any other unit in the chain, offering the singular combination of women’s, men’s, sport, maternity, plus sizes, accessories, cosmetics, children’s from newborns to kids age 14 and home. 

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