Daily News Digest- 6th Nov'14

Thought of the Day:

Today in History:

Following made the Headlines:

India:

• Samsung 2nd Largest Consumer Co in India: Samsung has overtaken ITC to become India's second-largest consumer-facing products company by revenues, and now looks set to better Maruti this fiscal to take the top slot. The South Korean consumer electronics and smartphone maker reported revenues of ₹40,392 crore from its India op` erations for 2013-14, 45% higher than the previous year, according to latest filings with the Registrar of Companies. As per industry estimates, around half of Samsung India's revenues came from `made in India' products. Tobacco-to-FMCG conglomerate ITC’s total income for last fiscal stood at ₹34,345.74 crore while carmaker Maruti Suzuki had reported revenues of ₹44,523.53 crore. Samsung India management is confident about overtaking Maruti Suzuki in sales this fiscal, with its sales, driven by mobile phones, continuing to grow in double digits even as the car market is struggling, industry insiders said. “A couple of months of poor sales will not have any immediate impact on Samsung and the company is confident to become the country’s largest consumer-facing firm and MNC this fiscal, more so since the automobile sector is still grappling with poor sales,” said one of the top trade partners of Samsung India.

• Sanjay Baweja appointed Chief Financial Officer of Flipkart: Homegrown e-retailer Flipkart today announced appointment of Sanjay Baweja as its Chief Financial Officer (CFO). Sanjay, who in his earlier role was Global CFO for Tata Communications, brings with him over three decades of experience, having worked with large names like Bharti Airtel, Emaar MGF and Xerox ModiCorp, Flipkart in a release said. It said in his current position, he will be part of the leadership team at Flipkart - contributing to the overall organisational development along with defining the strategic roadmap for profitable revenue growth for India's largest marketplace. Speaking about the appointment, Sachin Bansal, Co-founder and CEO, Flipkart, said - "Sanjay brings with him a rich experience of running financial set-ups across large and diverse organisations. His impressive background of successfully structuring the financial strategy of market leaders is going to be invaluable as we enter a pivotal point in our growth story." 

• Faster broadband,easier payment norms to boost e-retail growth: Providing access to faster broadband speeds and easing of payment norms in the country can play an important role in further boosting growth in the burgeoning e-commerce sector in India, the Internet & Mobile Association of India (IAMAI) said today. IAMAI, which recently led a delegation of Indian tech and Internet firms to China, said these steps can help improve customer experience and provide a fillip to the $ 3 billion Indian e-commerce sector. Talking about the e-commerce market in China, estimated to touch $ 450 billion this year from over $ 300 billion last year, IAMAI Chairman and Google India Head Rajan Anandan said the massive growth has come at the back of strong growth in Internet user base.

• Visa to hire more than 1,000 people for technology centre in Bengaluru: Global cards and payments company Visa Inc. on Wednesday said it will open its first technology centre in India in Bengaluru early next year, employing more than 1,000 people by 2017. Employees at its Bengaluru centre will focus on application programming interfaces (APIs) and software development which will help Visa’s global partners access VisaNet more easily, the company said. “Bangalore offers Visa the ability to attract a diversity of world class talent from the country’s premier universities, while being part of a community that is experiencing tremendous growth in world-class innovation centers and technology facilities,” Visa said. “India is fast becoming a global technology epicenter with an incredible pool of technology talent,” Nitin Chandel, senior vice-president of Visa’s developer platform based in India was quoted as saying in a press release. “The development of a technology center of excellence in Bangalore is an opportunity to build from the ground-up a culture of innovation that is reflective of Visa’s strategy to open its network to new and different technologies,” he added in the release.

• Marks & Spencer H1 Sales up 35%; Menswear up 46%: Marks & Spencer (M&S) on Wednesday reported 35% rise in India sales in the half year period ended September 2014, helped by strong performance across segments. Commenting on the results, Marks & Spencer Reliance India MD Venu Nair said: “India is a priority market for Marks & Spencer...We continued to see a good performance in India with sales increasing by 35% on a constant currency basis.“ During the half-year period ended September, 2014, M&S's menswear sales were up 46% over same period last year. The company's lingerie and beauty sales increased by 30% compared to sales in the previous year, M&S said.

• Mercury Takes Over Mahindra Holidays Travel Biz: Mahindra Holidays & Resorts India (MHRIL) has said it will stop providing travel-related services as its travel business has been taken over by Mercury Travels. “Travel Services will now be availed from Mercury Travels. As part of the transition, certain corporate clients of the erstwhile travel-related business (TRS) have also agreed to avail the services of Mercury for their travel requirements,“ MHRIL informed the BSE.

• Murdoch Eyes Deal in Indian Digital Space Again: A fledgling, financial education website that was conceived by a former banker, fascinated by his father's copious records of grocery prices and household budgets for over 20 years, has now caught the attention of the none other than Rupert Murdoch ­ the world's biggest media magnate. A year ago, former Citi banker and IIM-Ahmedabad alumnus Manish Shah tied up with a formerArthur Andersen and KPMG consultant-turned-techie-turned-insurance professional Gaurav Roy to start Bigdecisions.in. This self-funded venture, which has already clocked 100,000 users so far, has been looking for growth capital for its next phase of expansion. Murdoch's News Corp is currently in advance discussions with the founding promoters of the start-up for a strategic investment, which could even end up in a controlling interest, said multiple sources aware of the discussions. Facing a drop in advertising and subscription revenues, the global media giant has been branching out of its traditional publishing businesses with investments in newer ventures especially in digital and consumer internet properties. If successful, this will also mark the return of Murdoch ­ one of the earliest backers of local digital properties like Indya.com and Bazee ­ in this rapidly growing space that has already witnessed unprecedented investor frenzy after almost a decade. Last June, the Australian American billionaire officially split his empire into two separate companies, divorcing News Corp.'s print entities from its broadcast and entertainment operations which got housed under 21st Century Fox. BigDecisions.in helps retail users make smarter and more informed financial decisions by providing a free platform comprising informative and interactive videos, customised financial calculators and other content that can be used as a starting point of the needs analysis and the financial planning process. They primarily focus on an individual's crucial financial decisions -retirement planning, children's education, home buying, life and health insurance ­ hence the moniker. The target audience is someone who has no answers to questions like how much insurance is needed or whether to buy or rent a flat and so on.

• Indian Startups Show the Way in Gender Parity: Silicon Valley may be ahead of the curve in technology innovation but several Indian startups are showing the way when it comes to gender parity at the workplace. At some ventures, women make up nearly half the workforce and they are also making inroads into male-dominated precincts like senior management and field sales. “We definitely keep gender diversity in mind, while ensuring that we hire the best people,“ said Deepinder Goyal, cofounder of restaurant listing service Zomato where women make up 48 % of the 800-strong workforce. Across 18 countries where the Gurgaon company operates, there are more women selling Zomato's services marking a shift in an area long regarded as a male bastion. “It's not a conscious decision. However women are naturally inclined towards customer empathy . They can understand problems of clients and relate to them,“ said Upasana Nath, chief recruitment officer at Zomato, which is backed by Indian internet company InfoEdge and Silicon Valley's Sequoia Capital. Others like cloud telephony provider Knowlarity and online marketplaces Snapdeal and LimeRoad also boast a healthy ratio of women employees, underlining growing gender sensitivity in the Indian startup sector.A trend which contrasts favourably with the situation in Silicon Valley , where the average ratio for female technology workers is 2023% according to data from the Anita Borg Institute for Women and Technology . When Stanford graduate Jyotsna Pattabiraman returned to India from the US in 2012, she was determined to work only for a new venture. “In large organisations I've sometimes not even been allowed to complete my sentence in meetings,“ said the former executive at eBay and Yahoo! “You feel like a potted plant, like you don't actually belong there.“ said Pattabiraman who on her return to India started ecommerce portal Unamia before signing up as a senior vice president at Knowlarity last year.

• Jet Air to Ground Low-Cost Flights from December 1: Jet Airways will not operate low-cost flights from December 1, as the carrier is closing a service it started six years ago to now focus exclusively on full-service operations. The Naresh Goyal-founded airline started offering low-cost flights after acquiring Air Sahara and renaming it JetLite. Its move to end that service, now being offered under the JetKonnect brand, comes at a time when the Singapore Airlines-Tata Sons joint venture is getting ready to launch a premium service by the end of December and competition is intensifying in the budget space. Goyal had recently said that multiple brands and product offerings confused customers and that the strategy, going forward, would be to remain true to the full-service carrier philosophy with just one product -Jet Airways. “We are moving out of low-fare and will be offering only full-service inventory from December 1, 2014,“ said chief commercial officer Raj Shivkumar. Industry insiders say it would not be easy for the airline to get back corporate travellers, with a large number of them moving to low-cost airlines like IndiGo and SpiceJet. According to Shivkumar, the airline already has a large base of corporate clients and he expects more to join it. “We have a large network, which would also include Etihad's international network, to offer to our corporate clients. Also, we will be offering a much improved and great product that will bring a large number of corporates to us,“ he told ET on the sidelines of the launch of flights to Ho Chi Minh City from Delhi via Bangkok. The Vietnamese city is Jet's 22nd international destination. Shivkumar said over the coming days, the airline would connect more Indian cities with international destinations. It plans to launch direct flights to Abu Dhabi from Lucknow and Goa by the middle of this month and connect Ahmedabad and Pune with the UAE capital by next March, he said.

• Brokerages wake up to e-comm boom, rush to initiate coverage: As the Indian e-commerce story begins to play out and the hunt is on to find India's next Alibaba, brokerage houses are quickly doing a mid-course correction and rushing to cover e-commerce stocks such as Just Dial and Info Edge. Foreign brokerages such as Goldman Sachs, CLSA, Credit Suisse, HSBC, JPMorgan and UBS have all started tracking these stocks, as they sense the potential of the e-commerce space, and its big-bang impact on Dalal Street. Sample this: last July, only three brokerage houses were covering Just Dial, which has jumped to 23 at present, even as the stock has surged nearly three times since its listing in June 2013. Similarly, Info Edge is currently tracked by 24 brokerage houses, against 16 in July last, while the stock has jumped 120 per cent in one year, according to Bloomberg data. "The e-commerce space is the next big emerging theme in the markets, and brokerage houses don't want to miss the bus. We expect many success stories to unfold in the listed space, and currently we are at the beginning of an e-commerce boom," Kunj Bansal, ED and chief investment officer at Centrum Wealth Management, said.

International:

• Tesla reports record deliveries as losses mount: Tesla has reported a third-quarter loss of $74.7m (£46.8m) - more than double from the same period last year. However, shares in the firm rose 5% in after hours trading, as investors welcomed the electric car maker's record deliveries. Tesla said it delivered 7,785 Model S cars from July to September, up 41% from the same period last year. However, it lowered its total sales forecast for 2014, saying it expected to sell a total of 33,000 cars. The company said the widening losses were as a result of increased manufacturing and development expenses related to production of the Model S sedan. Tesla said it plans to spend more to increase production at a California plant so that it can produce 2,000 vehicles a week in 2015. However, Tesla said that it would delay the release of a crossover vehicle, the Model X, until autumn 2015 but did not provide a reason.

• Sainsbury's and Netto open first of 15 new discount stores: UK supermarket chain Sainsbury's is hoping to take on discount rivals Aldi and Lidl as it opens the first of 15 stores in Moor Allerton in Leeds, with Danish discount chain Netto.If successful, the next stage of the joint venture will see the new format rolled out across the country. The move is a return to the UK for Netto, which ended a 14-year presence here in 2010 when it sold up to Asda. The UK discount sector is the grocery market's fastest expanding area. It is currently worth an estimated £10bn in annual sales and is forecast to double in value to approximately £20bn in the next five years, according to analysts IGD.

• Toyota raises full-year profit forecast: Japan's biggest car manufacturer, Toyota, has raised its full-year profit forecast by 12.4%, citing a weaker yen and cost cutting efforts. It has also raised its sales forecast for its key market of North America, where it has been enjoying a strong performance. The firm said net profit may reach as much as 2tn Japanese yen ($17.5bn; £10.96bn) for the year to March 2015. The carmaker's earlier forecast was for a net profit of 1.78tn yen. Toyota's executive vice president, Nobuyori Kodaira, said the firm had also raised its forecasts for operating profit and revenue for the period. "We are revising our operating income forecast upwards by 200bn yen to 2.5tn yen," he said. He said this reflected the progress made on marketing and in reducing costs, and also the change in foreign exchange rates.

• Melisa Goldie Promoted to Chief Marketing Officer at Calvin Klein: Melisa Goldie has been named chief marketing officer of Calvin Klein Inc., a wholly owned subsidiary of PVH Corp. She reports to Steve Shiffman, chief executive officer of CKI. Under the new structure, CKI will unify the creative studio and the communications teams. Goldie will oversee all marketing-led initiatives including consumer engagement, public relations, advertising and social media. Most recently, Goldie was executive vice president and chief creative officer, overseeing the Calvin Klein Advertising and Marketing teams. She joined the company in 2001 as vice president of print and broadcast production and was promoted to senior vice president of creative services in 2006 and again to her most recent role in 2012.

• Gap Inc. Pushing Asian Expansion: The $16 billion Gap Inc. is pushing its Asian expansion. Old Navy is opening its first store in Shenzhen on Saturday, and its first one in Beijing in December. The openings will give Old Navy, which entered China in March, seven stores in the country. Gap’s first store in Guangzhou opens Saturday, and in Taiwan, Gap will open in Hsinchu in late November, bringing the Gap brand to five stores in that market since its launch there in March. “We continue to be excited by the response of Chinese customers to our brands,” said Jeff Kirwan, president of greater China for Gap Inc. “Both Gap and Old Navy have been warmly embraced, giving us confidence to continue our expansion in this vibrant region.” The company also said it will surpass 100 Gap-branded stores across Mainland China, Hong Kong and Taiwan on Saturday with the Guangzhou opening. Gap Inc. operates Gap and Gap outlets in China. The stores and the dedicated e-commerce site launched in China in 2010.

• Le Bon Marché Revamps Men's Offer: Three years after the start of its remodeling, Le Bon Marché has finally unveiled its new men’s floor, spread across the historic building’s basement, next to the wine cellar. “The neighborhood itself has been under construction, and it is essential for us to stay on top of this evolution,” said Patrice Wagner, chairman and chief executive officer of Le Bon Marché, referring to the ongoing renovations of the Lutetia hotel, which sits next door, as well as the new development of high-end real estate in the retailer’s backyard that is expected to attract a fleet of affluent shoppers to the store. In a walk-through of the new floor on Wednesday, Wagner said that, unlike many department stores, 75 percent of Le Bon Marché’s assortments are handpicked by its buyers, instead of being provided by the brands themselves. “The products need to be in line with our identity,” which is Parisian, chic and essentially Left Bank, he specified.

• Minnie Rose to Open First Outlet at Tanger Outlets: Minnie Rose, the contemporary sportswear collection, will open its first outlet store at Tanger Outlets in Riverhead, N.Y. The 600-square-foot store is scheduled to open Nov. 10 with a ribbon cutting. The store will carry Minnie Rose’s 100 percent cashmere pieces, including ruanas, dusters, shawls, wraps, pullovers and accessories. The collection is designed by Lisa Shaller-Goldberg, founder of the company.

Tech:

• Mumbai has highest number of Internet users in country: Mumbai continued to have the highest number of Internet users in the country, with the number reaching 16.4 million in October, a 37% jump over 2013, according to Internet and Mobile Association of India (IAMAI). Delhi saw a 50% spike in Internet users to 12.2 million, from October 2013—the highest growth among the top cities in India, the industry lobby group said, based on early findings of its IMRB I-Cube 2014 report. While Mumbai and Delhi held on their No. 1 and No. 2 position, respectively, Kolkata overtook Bangalore to attain the third position with 6.3 million users, from 4.7 million in 2013. Chennai, with 24% growth in the number of Internet users, registered the lowest growth rate among the top eight cities. Chennai had 5.6 million Internet users. The method to arrive at the number of users will be only known when the full report is published later this month by IAMAI and market researcher IMRB. According to the report, the top four metros including Mumbai, Delhi, Kolkata and Bengaluru account for 23% of Internet users in India. The other four metros— Chennai, Hyderabad, Ahmedabad and Pune—account for 11% of Internet users in the country.

• WhatsApp finally tells you when your messages have been read: If you’re a WhatsApp user, you should see a small but useful change start rolling into the app. As 9to5Mac spotted, the app will now light up its double-check marks blue when a message has been read. If the read receipts don’t seem new to you, you’re probably not alone. Many users have misinterpreted the double check marks next to messages to indicate that a message has been looked at, as so may other platforms offer the feature, but that’s not the case. In reality, the double check marks simply mean a message has been received by the other user (the single check only tells you the message reached WhatsApp’s servers). The blue coloring adds a third layer of information, as an updated FAQ will confirm. Alternatively, you can long press on a message to access a ‘Message Info‘ screen, detailing the times when the message was received, read or played. Of course, one could use ‘last seen’ indicators on the top left of a conversation to know when a contact was last in the app, but the blue checkmarks are more direct. It would have been nice to see this added in as an on opt-out feature though – some users may not be so fond of the additional information.

• Square Passes 1 Billion Payments: US payments startup Square has passed a not-so-minor milestone this week, with founder Jack Dorsey revealing the company has now processed one billion payments. One of Square’s core services is in enabling smaller merchants to accept offline payments using mobile devices, but it has been building out its various offerings in recent times. Following its recent $100 million funding round that valued the company at $6 billion, Square Cash for iOS was updated to let you pay friends nearby using Bluetooth LE, and shortly after it was revealed that the separate Square Order app would now let you order ahead and alert cafes of your imminent arrival. Launched in San Franciso in 2009 By Twitter co-founder Dorsey and Jim McKelvey, Square first rolled out for merchants the following year. It’s now open to users in the US, Canada and Japan.

• Google Maps Gets a Fresh New Material Design on Mobile: Google has announced today that its Google Maps ‘Material Design’ update will start to roll out to iOS and Android users in “the next few days”. Announced in a blog post, the revamp brings a whole new look to the mapping app, as well as some new functionality, like direct OpenTable bookings in the US. Google explained that the driving principle behind the new design decisions was to make it easier to use (and discover) certain features. “This new look is all about creating surfaces and shadows that echo the real world; with Google Maps’ new material feel, layers and buttons come to life so you know just where to touch to get directions, recommendations and imagery,” the company said. Deeper OpenTable integration isn’t the only functionality update either. The new Google Maps app will also now show you the estimated pick-up time and price for an Uber journey, versus the same journey by public transit. You’ll need to have the Uber app installed for this option to appear though.

• Samsung Gear S Smartwatch Launches in the UK: Announced back in August, Samsung’s new Gear S smartwatch is a proper ‘smart’ watch, given you can make calls and go online without a smartphone. And Samsung has now confirmed it’s going on sale in the UK this week. The Tizen-powered timepiece lets you receive notifications from social networks, calendars and apps, as well as reply to incoming messages using the onscreen keyboard. The watch will be available through Samsung Experience Stores, the Samsung.com Shop and O2 on November 7, with other UK retailers to follow at a later date. 

• Amazon Brings Same-Day Shipping to Canada: Amazon has announced that it’s launching its same-day delivery service in Canada, kicking off with Toronto and Vancouver. Today’s news comes a few months after the e-commerce giant revealed it was expanding its same-day offering to more US cities, and just a few weeks after a same-day collection service was introduced in the UK. Customers in the two aforementioned Canadian conurbations can order up until noon seven days a week with deliveries taking place up until 9pm. Same-day deliveries, however, will only apply to certain items such as games, DVDs, electronics, snacks and “household necessities.” Amazon says that there are around one million eligible items in Toronto, and ‘hundreds of thousands’ in Vancouver. In terms of pricing, Amazon Prime members will pay a flat-fee of $6.99 for each same-day delivery order (regardless of the number of items). Non-Prime customers will pay a $11.99 charge ‘per shipment’, plus an additional $1.99 cost for each item. Things could get rather punchy if you order a lot from Amazon, so the $79/year Prime subscription starts to make a lot more sense if you’re a frequent shopper.

• Bharti Calls off Rs 700-Cr Deal with Loop Mobile: The country's No. 1 telecom carrier Bharti Airtel has scrapped its Rs 700-crore deal to buy the subscribers and assets of Loop Mobile over delay in government approval, bringing the curtains down on what would have been India's first M&A in the sector since 2008. Airtel's proposed deal with Mumbai-based Loop had been awaiting clearance for over eight months. The scrapping of the pact will affect some 120,000 subscribers of Loop as the operator's licence is set to expire this month. “Loop had late last evening sent us an email noting that DoT (department of telecommunication) approvals had yet not been received and had also noted that it was way beyond the time envisaged for securing such an approval,“ Bharti Airtel said in a statement to the stock exchanges late on Wednesday . “In light of this update, and the fact that Loop's mobile licence is set to expire at the end of the month, we have decided to terminate the discussions with regard to the transaction for acquiring the subscribers of Loop,“ the company added. Shares in Airtel, which could have overtaken Vodafone to lead the lucrative Mumbai market by user base if the deal had gone through speedily, ended the day down 2.7% at Rs 385 a piece on the news. Surya Mahadevan, chief operating officer of Loop, said Bharti Airtel's decision will cause a huge loss to the company, which won't be able to migrate its subscribers to Airtel as originally planned. Loop, owned by the Khaitan family, had hoped to repay its creditors with part of the deal proceeds. All customers of 20-year-old Loop must port out of the network by November 29, when operations must be terminated, he added. The closure of business also means curtains to a job for Loop’s 10 senior management staff and some 190 employees. Mahadevan said movement of the employees was never on the cards. Moreover, no termination settlement is on the cards as of now, he added. At the time the deal was signed, Loop had about 750 employees, and negotiations were on to include some staff transfer to Airtel. The technology, network maintenance and relationship teams were particularly hopeful of getting transfer packages, said a senior staffer.

• Happy birthday Twitter? One year after IPO, losses abound: Twitter Inc. is celebrating its one-year anniversary as a public company on Friday with a stock that’s soared 55% from its debut. Its performance by many other measures is less stellar. After jumping 73% to open at $45.10 on its first trading day, Twitter’s share price on Thursday is lower at $40.37, and the company currently has a record-low enterprise value of 19.4 times trailing 12-month sales, according to data compiled by Bloomberg. The San Francisco-based company also continues to bleed money, with losses widening faster than sales gains. Twitter’s profitability has been pushed out to 2017 from 2015 at the time of its initial public offering (IPO), according to analysts’ estimates compiled by Bloomberg. The data underline how Twitter has fallen short as the rocket-ship growth stock it billed itself as during the run-up to last November’s IPO. The microblogging service touted its global reach and potential during its pitch to investors, asking them to focus on monthly user numbers that ended up slowing. Now chief executive officer (CEO) Dick Costolo is dealing with the backlash, even as the company’s digital-advertising business booms. “The disconnect between what people thought would happen with Twitter’s trajectory and what actually happened make this one of the bigger “misfires” in technology stocks,” said Francis Gaskins, research director at financial-media site Equities.com. “It’s been a round-trip ticket.”