The government of India has called off the merger of the three public sector non-life insurers - National Insurance, Oriental Insurance and United India Insurance - and has announced an additional capital infusion of £995 million. The Union Cabinet approved a £1.25 billion equity infusion into the non-life companies, which includes the £250 million already invested in FY20. “The process of the merger has been ceased so far in view of the current scenario and, instead, the focus shall be on their profitable growth,” the government said in a statement. Of the £995 million infusion, £347.5 million will be released immediately, while the balance £647.5 million will come in one or more tranches. To enable the capital infusion, the Cabinet approved an increase in the authorised share capital of National Insurance to £750 million and that of United India and OICL to £500 million respectively to give effect to the capital infusion.
Qualcomm Ventures to invest £73 mn in Jio
Reliance Industries (RIL) has raised £73 million from Qualcomm Ventures by selling 0.15% stake in Jio Platforms. RIL has so far mobilised £11.8 billion by selling 25.24% in Jio to 11 international investors, with the largest slice sold to Facebook. The total money raised by RIL is just £200 million less than the Indian government’s disinvestment target of £12 billion for fiscal 2021. The foreign money will help RIL pare its £33.6 billion debt. Qualcomm Ventures, the investment arm of Qualcomm - the world’s largest supplier of modem chips that connect cellphones and other devices to data networks - has pegged the valuation of Jio at £51.6 billion. This is similar to the valuation assigned by other financial investors to Jio. The investment will deepen the ties between Qualcomm and Jio, RIL said. The US company will support Jio in its rollout of 5G infrastructure and services for Indian customers, the Indian company added.
E-commerce sellers to display country of origin
The government has proposed that new products being sold on e-commerce platforms should display the country of origin from next month, while allowing marketplaces to ask sellers to make the disclosures for all products from October. In a meeting with industry representatives, the department for promotion of industry and internal trade did not specify a deadline as ecommerce players suggested that it will take a while for all the existing goods to reflect the country of origin.
For e-commerce companies, the bigger issue is to reflect the change in existing products than new ones. “Some of them (e-commerce firms) proposed that it should be done in a graded manner without any penalty. For new listings, platforms can provide the technology and guidance to sellers but changing the same for hundreds of millions of products would take time and current priority is to boost sales,” a person aware of the matter said.
Flipkart to buy £26 mn stake in Arvind unit
Walmart-backed Flipkart is set to pick up a significant minority stake in Arvind Youth Brands, a recently-formed subsidiary of Arvind Fashions, for £26 million. The deal will give Flipkart, which owns India’s largest fashion e-commerce platform Myntra, considerable control over the readymade apparel and footwear brand Flying Machine, as Arvind Fashions and its subsidiary Arvind Lifestyle Brands signed an agreement to sell it to Arvind Youth Brands. The fresh capital infusion is expected to give a fillip to beleaguered Arvind Fashions, which has been struggling in the domestic fashion business, having exited four brands with “less growth potential” and consolidated its value fashion retail business.
