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The Power of Reliance - Business News At A Glance, Ep. 2

Sep 16, 2020 | 4 minutes |

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This pandemic has spelled disaster for many businesses. But certain industries and domains are actually seeing rapid growth these days! In today’s News At A Glance - find out about the power of Reliance Retail, the growth of UPI and fintech, and a little something about the Government’s plans for startups and small businesses!

 

Highlights for the day:

Ambani puts Carlyle, SoftBank on waiting list for Reliance Retail stakes

Synopsis

Reliance Retail, the poster child of “Make in India,” has been in the news for various reasons. The latest? Investment giants like SoftBank & Carlyle have been put on a waiting list according to sources before they too can ride the wave that is an investment in Reliance Retail. Mukesh Ambani, after pivoting focus from energy to retail as a part of his contribution to the Reliance megalith, has been making waves with news about offering Amazon, the US tech giant, roughly a 20 Bn USD stake in the retail pie which could be equivalent to as much as a 40% holding. All of this makes one wonder - why?

How is this relevant for you, the MBA student?

Whether you’re preparing for interviews, GDs, or some competitions, knowing the logic and strategy behind the rise of a Retail giant is a value add. No matter whether you’re studying marketing, finance or some other specialization, there’s something everyone can take away from this article. To start with, Mukesh Ambani identified retail as one of the latest drivers of commerce in India. Based on this analysis, Reliance Retail came into being. And today the stakes are so high that legacy investors like SoftBank and Carlyle are put on a waitlist. And then there’s Ambani’s offer to Amazon. Not only are investors of Jio pumping funds into Reliance Retail, but other investors are also lining up too!

This shows how valuable the retail business is in India today. It also shows a diversification strategy. Perhaps, Ambani wants to give birth to India’s Alibaba! One has to wonder what investors like Amazon would bring to the relationship and how both giants will benefit!

Tell us what you think? Why are investors on a waitlist? What do you think is the strategy behind inviting Amazon to invest? Share your answers in the comments section below!


In Other News:

Contactless Payments Are Gaining Traction: Sajith Sivanandan, MD & Business Head - Google Pay

With COVID 19 bringing the economy to a standstill for a point, there were many concerns for businesses about the future and growth opportunities. It’s been a few months since, and we are seeing a surge in all things digital. Digital businesses are regaining market share pretty quickly, while traditional systems are trying to go digital. In this vein, we see an upsurge in contactless payments that happen online. India’s unique UPI system makes contactless, digital payments easy for most people. The biggest USP of the UPI framework is the trust consumers seem to have for it. In this interview, Sajith Sivanandan, MD & Business Head at Google shares insight into what makes contactless payments a winning opportunity for fintech startups and players.

Govt. Working On Credit Guarantee, Seed Funding For Startups

The Department for Promotion of Industry and Internal Trade is working on two schemes, credit guarantee and seed funds, to support startups in the country, according to DPIIT Secretary Guruprasad Mohapatra. This scheme would give banks a comfort to lend, making it for credit not for venture capital. On the seed fund scheme, Mohapatra said that most startups actually face problems in raising finance or funds in the ideation to the proof of concept stage. Some states like Gujarat and Kerala already have schemes like seed funds, but they are small. A pan India scheme for seed funds is on the agenda now. Check out how startups can benefit from this measure.