New Delhi: A day after announcing USD 16 billion investment in India’s largest online retailer Flipkart, Walmart Inc on Thursday said it will continue to grow its wholesale cash-and-carry business, adding 50 new stores in the next four-five years.
“We currently have 21 stores and plan to open 50 stores in 4 to 5 years. Plans are on track,” Walmart India President and CEO Krish Iyer said at a select media roundtable called to explain the Flipkart deal.
Walmart Chief Executive Doug McMillon said Flipkart, in which the US retailer is acquiring 77 per cent stake, would continue to operate as a separate board-managed company with co-founder Binny Bansal as the CEO.
Flipkart gives Walmart an online presence. So far it had been handicapped by India’s retail policy that does not allow overseas companies to sell directly to consumers (except in wholesale cash-and-carry segment).
Companies like Flipkart and Amazon operate as e-commerce marketplaces — a segment where 100 per cent foreign direct investment (FDI) is allowed.
“As we speak, we have a pipeline of 20 stores and we expect to open 5 stores in the current year and then pick up pace and eventually start opening 12-15 stores a year,” Iyer said.
For the cash-and-carry business, Walmart currently operates in 9 states and 19 cities and the future expansion is focused on more or less the same geographies.
“We are not spreading thin. We are continuing in same geographies but primarily focus is on Punjab, Haryana, Uttar Pradesh, Uttrakhand, Maharashtra, Andhra Pradesh and Telangana,” he said.
At its 21 Best Price wholesale stores, Walmart sells everything from fast-moving consumer goods to furniture to other retailers and institutions. It could potentially use these Best Price stores as pickup and delivery points to service online sales made on Flipkart.
Analysts believe that Walmart’s investment in Flipkart, whose 34 per cent market share in India’s online sales is ahead of rival Amazon’s 27 per cent, will boost the Indian e-commerce company’s logistical operations and help it move into new areas such as online groceries.
Walmart is buying 77 per cent of Flipkart from existing shareholders, including Japan’s SoftBank, for USD 14 billion and investing USD 2 billion of fresh equity.
Walmart India is a wholly-owned subsidiary of Walmart Stores Inc and offers close to 5,000 items through its cash-and-carry wholesale format.
Pakistan says airspace closure led to loss worth $50 million
Islamabad: The closure of airspace by Pakistan after the Indian Air Force carried out airstrike in Balakot made the country suffer a loss worth $50 million. The same was confirmed on Thursday by Pakistan’s Federal Minister of Aviation Ghulam Sarwar.
The minister, however, added that India suffered loss worth more than $50 million, saying that the restriction hit India harder and New Delhi’s loss was almost double than Pakistan’s, reported Pakistani media.
Addressing a press conference, the minister further said that the exact figure of loss was yet to be ascertained.
Pakistan decided to open its airspace after a gap of almost five months. The Indian government welcomed the move, with the Ministry of Civil Aviation confirming that there were no more airspace restrictions.
“After cancellation of NOTAMS by Pakistan and India in the early hours of Tuesday, there are no restrictions on airspaces of both countries, flights have started using the closed air routes, bringing a significant relief for airlines,” read a statement released by the Ministry of Civil Aviation on microblogging site Twitter.
India had previously requested Pakistan to lift the ban and allow commercial airlines to make use of its airspace. Pakistan, however, had said that it would do so only if India agreed to remove its fighter jets from forward bases along the border.
The development came as a boon for aviation carrier in India, especially state-carrier Air India.
Apart from ensuring shorter flying time, the opening of airspace over the neighbouring country has also curtailed the cost incurred on aviation turbine fuel. According to Air India officials, the closure of airspace was leading to loss worth Rs 6 crore.
The flights from India had to travel via Vienna to avoid the Pakistani airspace. The aircraft also needed to halt in Vienna, which led to increased travel time.
Investments of Rs 5 lakh crore required in Transmission to meet energy needs of a $5 trillion- economy: CII
New Delhi: The Confederation of Indian Industry (CII) has said that Prime Minister Narendra Modi’s vision of a 5 trillion-dollar economy will require an estimated investment of Rs 5 lakh crore in the transmission sector over the next few years.
As per estimates, India will be consuming 1.8 trillion units by 2025 as India’s growth trajectory accelerates, and this requires large investments in the transmission sector, particularly at the state level. The transmission sector has seen a fall in the investments to below 1.8 lakh crore in the last five years but this will need to see a significant jump as 500 GW of renewable energy is added to the grid by 2030, CII said.
CII has worked on a white paper “New Age Power Systems: For 21st Century India Challenges, Solutions and Opportunities” with a view to partner with the government in developing a blueprint for efficient transmission system.
The 8-point agenda drawn up for a robust transmission system includes recommendations on planning, operations, costs to name a few. The report seeks to draw up a blue print for country’ vision on power for all and electric mobility which is a stated goal of the GoI.
“There is a need to recalibrate our power systems in line with the changing energy scenario. With more than 90 percent of the capacity addition in the renewable sector, there is a need to make transmission grids more suited to handle the intermittent power while adhering to the challenges of urbanization and paucity of land,” Ranjan Mishra Co-Chairman of CII National Committee of Power and Managing Director, CLP India said.
The major recommendations include urgent need to upgrade capacities within existing infrastructure, clearly distinguishing the role of the central transmission utility from the functions of the developer, redefining the scope of planning for the center which should be based on the capacity of the transmission line instead of the geography where the same is located, and finally the need to bring in competition and move away from the cost-plus approach or regulated tariff mechanisms.
The creation of an independent Central Transmission Utility (CTU) completely distinct from any developer will ensure a transparent planning and development and operation process and encourage private investments. Also in a bid to ensure efficiency of costs and better consumer prices, the report has called for competitive award of transmission projects. Addressing the media Mr Pratik Aggarwal, Chairman of CII’s Core Group on Transmission and the Group CEO of Sterlite Power Transmission Ltd. said that the report illustrates that competitive bids have ensured tariff reductions by almost 30 percent compared to projects awarded on a nomination basis that follow a cost-plus approach.
Jet Airways interim RP receives claims of over Rs 24,000 crore from lenders
Mumbai: The interim resolution professional (IRP) handling Jet Airways insolvency has received claims of more than Rs 24,000 crore from its lenders, vendors, travel agents, and employees. The IRP has admitted 33 claims from banks worth Rs 8,462 crore, and is verifying Rs 15,044-crore claims from operational creditors and staff.
Naresh Goyal-owned group companies, including the airline’s general sales agents in India, the UK, the UAE and a car rental firm, are among those who have filed the claims. Jet Privilege (Jet’s loyalty programme), Etihad Airways, and its group companies have filed the claims, too. The IRP has rejected Rs 230-crore debt claim from Jetair (India general sales agent) and is verifying its Rs 87-crore claim as an operational creditor. The UAE-based general sales agent has claimed Rs 426 crore.
Only claims related to Jet are being considered and those of subsidiary JetLite will not be accepted, IRP Ashish Chhawchharia said in a notification on Thursday. “The corporate insolvency process of only Jet has been initiated, the wholly owned subsidiaries being a separate legal entity is outside the purview of the process and hence only the claims pertaining to Jet shall be considered,” he said.
Jet shut operations on April 17. Last month, its lenders decided to refer it to the insolvency court with the hope of finding a buyer. The National Company Law Tribunal has asked the IRP to complete the process in 90 days.
Creditor claims are being received as part of the insolvency process. Claims worth Rs 8,462 crore of domestic and overseas lenders have been admitted, while claims of Rs 1,380 crore rejected.
Lenders are voting this week to decide who can bid for the airline as they don’t want any frivolous players in the race, the committee of creditors (CoC) discussed in its first meeting on Tuesday.
E-voting should be over by Friday and advertisements inviting expressions of interest for Jet are scheduled to be out by July 20, said sources who attended the meeting. The suitors will get time till the first week of August to submit EOIs.
The CoC has finalised the voting rights of each lender based on amount owed. State Bank of India has 19.43 per cent votes, highest among all lenders followed by YES Bank (12.81) and Punjab National Bank (11.31).
In the first CoC meeting, the lenders took stock of the assets of the company, which include six planes, spare parts, slots, Jet Privilege shares, and other intangible assets. Interestingly, the plane confiscated by Dutch authorities is being treated as an asset. Sources said the team working for the IRP, Grant Thornton, had been engaging with the aviation ministry and the Directorate General of Civil Aviation regarding the slots that had been given away to other airlines temporarily. The interim RP has admitted the claims of the financial creditors worth Rs 8,500 crore.