Happy Friday!
Jio Platforms is on a deal-making spree. The holding company of India’s largest telecom operator—Reliance Jio Infocomm—struck its fifth deal in a month. Private equity firm KKR will invest Rs 11,367 crore in the company for a 2.32% stake.
This follows the investments made by social media giant Facebook, private equity funds Silver Lake, Vista Equity Partners and General Atlantic. But that’s not all. Analysts expect more such deals to take place as the Mukesh Ambani-led oil-to-telecom conglomerate plans to pare a major chunk of its debt.
Jio on a roll
With the latest deal, Jio Platforms will get a combined Rs 78,562 crore from the five investments.
Highly quotable
“Few companies have the potential to transform a country’s digital ecosystem in the way that Jio Platforms is doing in India, and potentially worldwide.”
– Henry Kravis, Co-Founder, KKR
KKR is making the investment from its Asia private equity and growth technology funds. Read more.
Grocery boom
India’s online grocery market could top $3 billion in sales this year, a 76% jump over last year, as the spike in demand for home delivery of fresh produce and staples seen during the nationwide lockdown is expected to sustain through the rest of the year.
By the numbers
– India’s e-commerce industry is pegged to grow 6% to about $35.5 billion this year
– BigBasket continues to fulfil over 300,000 orders a day, compared to 150,000 orders before the crisis. Read more.
Caterers rejig biz
Corporate caterers are pivoting business models and expanding into newer categories, following a steep fall in core business over the last two months due to the Covid-19 pandemic. Elior India, Sodexo and Compass, as well as smaller players like Hungerbox, Petoo and Zoiffin say office cafeterias will sport a different look once social distancing measures and a focus on hygiene take root as India Inc gradually restarts and reimagines workplaces.
What changes?
Across the board, caterers are narrowing their exposure to offices and expanding to adjacent markets including industrial workforce, subscription programmes and consumer packaged food. They say pre-packaged food trays, vending machines and contactless dining practices will become the order of the day, replacing traditional food courts, live counters and shared resources—microwaves and coffee machines—in cafeterias. Read more.
Looming stress
Fintech lenders’ bounce rates—loans not repaid on time—have nearly tripled in April, in an early indication of financial stress among consumers and small businesses.
Why it matters
The trend is worrying at a time when job losses and disruptions to cash flow are likely to set off defaults, shrink demand for credit and sober valuations for most fintech players.
Bounce rates need not turn into defaults though. Customers who miss repayment deadlines can still pay within 90 days although with a penalty. The bounce rate does not include repayment deferment taken under moratorium. Read more.
Amazon hiring
Amazon said it will create 50,000 seasonal job opportunities across its fulfilment and delivery networks in India to meet the surge in demand for online ordering, soon after the government allowed e-commerce firms to ship all products across the country, except in containment zones.
The company said the temporary associates will work alongside its existing supply chain staff across roles to pick, pack, ship and deliver orders to customers. The newly created jobs will include part-time flexible work opportunities for workers through its recently launched Amazon Flex service.
Why it matters
Amazon, like other e-commerce players in India, has been facing a shortage of on-ground staff owing to a large displacement of workers due to the coronavirus pandemic and also concerns around safety. While the company has over the past two months recovered its fulfilment and delivery capabilities, it has been operating at suboptimal levels according to experts. This also comes at a time when a lot of companies have laid of staff and resorted to salary cuts to reduce costs. Read more.
Leave a Reply