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Daily Financial News Analysis – 17th August’20 – Free PDF Download

 

e-Commerce Festive Sales

  • India’s two biggest e-commerce marketplaces expect this year’s festival-season business in smartphones, television sets, refrigerators, washing machines and apparel to nearly double for some categories and increase at least 40% in others.
  • The platforms have accordingly asked sellers to place large orders with the respective brands.
  • Customer base has also increased 35-40% since the pandemic
  • In mobile phones, Amazon and Flipkart expect sales to more than double this festive season from the year earlier while in consumer electronics, they expect a 50-60% surge in business.
  • These two categories contribute more than 60% to transaction revenue at the online marketplaces.
  • Flipkart and Amazon are hopeful of clocking 40-50% growth in apparel and fashion, with categories such as sportswear, footwear and casual wear performing better than formal wear in the last sales, the executives said.
  • The festive season is the biggest shopping period for Indian consumers, accounting for 40-50% of annual business for most brands.
  • Ecommerce accounts for about 45% of the smartphone business in India.
  • About a quarter of television sets are sold online, while these platforms account for 10-20% of annual revenue for other appliances and large fashion brands.

Samsung

  • Samsung may shift a major part of its smartphone production to India from Vietnam and other countries.
  • South Korean electronics major finalising plans to produce devices worth over $40 billion (Rs 3 lakh crore) in the country.
  • Vietnam is the world’s second-largest exporter of smartphones after China.
  • Samsung has submitted estimates of making smartphones worth over $40 billion to the government in the next five years (under the PLI scheme).
  • Out of this, phones with factory price of over $200 could account for over $25 billion.
  • The company runs its largest mobile phone manufacturing unit in the world in Noida, from where it also exports to other markets.
  • In addition, it has manufacturing bases in Brazil and Indonesia.
  • Once Samsung’s move fructifies, the company will join iconic smartphone major Apple, which is also in the process of shifting a key part of its production line for smartphones to India.
  • The global smartphone export market is about $270 billion.
  • By value, Apple has a 38% market share and Samsung 22%. By volume, Samsung has 20% and Apple 14%.

‘T+1’ CYCLE

  • A faster trade settlement system for Indian stocks is in the offing.
  • The Securities & Exchange Board of India is considering a reduction in the settlement cycle for completion of share transactions to T+1 — an abbreviation for ‘trade plus one day’ — from the existing T+2.
  • The move, when implemented, is expected to improve liquidity, boost efficiency and reduce risks to the system.
  • A T+1 system would mean that trades will be settled the day after the transaction.
  • So, a buyer would get the shares in the demat account and the seller would get the sale proceeds the next day.
  • Currently, trades are settled two working days after execution.
  • The majority of developed markets follow the T+2 trade settlement system. India had moved to the T+2 settlement cycle from T+3 cycle 17 years ago.

Change in Workplace

  • The pandemic has accelerated trends such as remote working, digitisation and the adoption of new technology, calling for new and upgraded skills in the post-Covid world.
  • Business heavyweights and top minds debated the future of work and what it will take to succeed at the second edition of the ET Back to Business Dialogues.
  • History has shown that the most adaptable will survive and the one essential skill is maintaining balance in the new work environment.
  • “Approaching this situation with an open mind and expecting the unexpected will be a necessary ingredient of all leadership and almost all managers. Only then can you be successful, regardless of what happens to the situation,” Munjal said.
  • All smart businesses will ask this question: Do we need so many people to come to work?
  • More flexibility is clearly on the cards but this is neither the end of employment nor the end of offices.
  • Problem-solving skills, agility will be key but even in traditional areas, people will have to adapt to be relevant in the virtual world.
  • Softer skills would become much more important.

 

 

 

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