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- Bit by Bit 19th Jan || The unravelling of GoMechanic after SoftBank-Khazanah funding collapsed || Domestic automotive industry expected to grow at high single-digit rates in FY24: ICRA & more
Bit by Bit 19th Jan || The unravelling of GoMechanic after SoftBank-Khazanah funding collapsed || Domestic automotive industry expected to grow at high single-digit rates in FY24: ICRA & more
Good Morning Readers!
Here are:
"5 amazing stories in 5 minutes to make you future ready"
Happy reading!
MARKET UPDATE
NIFTY 50 : ₹18,165.35 (+0.62%)
BSE SENSEX : ₹61,045.74 (+0.64%)
NIFTY BANK : ₹42,458.00 (+0.53%)
USD/INR : ₹81.360 (-0.33%)
BRENTOIL : $85.17 (-0.87%)
MCXGOLD : ₹56,213 (-0.17%)
FII Net Cashflow : - ₹319 crores
DII Net Cashflow : + ₹1226 crores
(Market Data as of 11:00 PM on 18/01/2022)
ECONOMY
The Story:
The administration on Wednesday suggested a few modifications to strengthen the insolvency Law system, including accelerating the procedure, broadening the use of the pre-packaged framework, and creating an electronic platform with little human interface. The Insolvency and Bankruptcy Code (IBC), which went into effect in 2016, enables a market-linked and time-bound resolution of stressed assets.
Among other changes, the govt has suggested developing a state-of-the-art electronic platform that can handle several processes with minimum human interface. The notice stated that it was being considered that this electronic platform "may provide for a case management system, automated processes to file applications With the AAs, delivery of notices, enabling interaction of IPs (Insolvency Professionals) With stakeholders, storage of records of CDs (Corporate Debtors) undergoing the process, and incentivizing participation of other market players in the IBC ecosystem."
The ministry has also suggested changing the Fast-Track Corporate Insolvency Resolution Process (FIRP) so that financial creditors can control the insolvency resolution process for a CD outside of the legal system while still retaining some involvement from the Adjudicating Authority (AA) to increase the legal certainty of the outcome.
FMCG
The Story:
The Lightspeed Venture and Microsoft-backed unicorn had shipped 260 million products, catering to around 50 million orders in 2021 -- which was hugely impacted by the pandemic
B2B e-commerce firm Udaan recorded over a six-fold jump in product shipments to 1.7 billion in 2022, catering to over 22 million orders, driven by demand for FMCG products, according to data shared by the company on Wednesday.
The Lightspeed Venture and Microsoft-backed unicorn had shipped 260 million products, catering to around 50 million orders in 2021 -- which was hugely impacted by the COVID-19 pandemic.
The total shipments made to over 1,200 towns and cities included over 70 million electronics products, more than 30 million products each in the lifestyle and general merchandise category, 9 lakh tonnes of essentials, and 1.5 lakh tonnes of FMCG products during the year.
AUTOMOTIVE
The Story:
The domestic automotive industry has seen a healthy revival in the current fiscal, aided by a recovery in economic activities and increased mobility, and is expected to grow at high single-digit levels across segments in FY24, a report said on Wednesday. Category-wise, passenger and commercial vehicle volumes could see a growth of 6-9 percent and 7-10 percent, respectively, the two-wheeler and tractors are estimated to grow at 6-9 percent and 4-6 percent, respectively, in the financial year starting April 2023, domestic credit rating agency ICRA said.
"We expect growth across automotive industry segments to remain at high single-digit levels in FY2024. While the passenger vehicle, commercial vehicle, and tractor segment volumes would continue to trend upwards, aided by favorable demand drivers, the two-wheeler industry is also expected to record moderate growth in volumes aided by a low base," said Shamsher Dewan, Senior Vice President at ICRA.
ICRA forecasts a CAGR of 6-9 percent across automotive segments over the medium-to-long term. The rating agency said that supporting underlying factors such as rising per capita incomes, demographic profile, low vehicle penetration, favorable policy environment including infrastructure development, etc., are expected to help grow the industry demand steadily.
TECH
The Story
After more than a year of intermittent conversations, SoftBank is rumored to have withdrawn from a funding transaction in the car servicing startup GoMechanic after due diligence (DD) revealed major flaws in the company's accounting and operations, according to sources with knowledge of the situation.
The investment due diligence, which was carried out by EY India for SoftBank and Khazanah jointly, brought to light problems with the company that was backed by Sequoia Capital and Tiger Global, including fictitious garages, selective payments to specific garage units, and discrepancies in revenue and user metrics.
Early in 2022, the Japanese technology company and GoMechanic started talking about a prospective finance agreement, but the discussions broke down because of a disparity in valuations. When the business met Masayoshi Son, the founder of SoftBank, an agreement in principle was reached. However, SoftBank was only willing to provide $850 to $900 million, not the $1.2 billion valuation demand, according to one source who spoke on the condition of anonymity since the negotiations were taking place in secret.
According to reports, SoftBank reopened the negotiations approximately six months ago with a prospective investment of $30 to $35 million at a significantly lower valuation of $600-650 million.
As of Wednesday afternoon, none of the companies GoMechanic, Sequoia Capital India, SoftBank, Khazanah, and EY India had responded to an email inquiry.
Anything Interesting
Ultraviolet (UV) rays are known to cause skin cancer at high exposures, and yet very little safety research has been done on the lamps used to dry nail polish in beauty salons.
Now a new study by researchers at the University of California San Diego and the University of Pittsburgh in the US has uncovered concerning evidence of damage this overlooked source of radiation could be causing to our hands.
LED nail polish dryers look like little tanning beds for your hands. They use UV light to cure and dry some types of nail polish quickly and cleanly.
The bulb on an LED nail polish dryer is less intense and has a different UV spectrum to a tanning bed, but the few rays it emits still easily penetrate the skin with unknown results.
