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Friday, July 20, 2018
Maharashtra, Foxconn may sign deal for plant, finally

FoxconnAfter many false starts, the Maharashtra government and Foxconn are likely to sign a deal under which the world’s biggest contract manufacturer of consumer electronics will finally set up a manufacturing hub in the state. Executives of Taiwan-based Foxconn held meetings with state government officials on July 4 in Nagpur and subsequently went on to meet Maharashtra chief minister Devendra Fadnavis, ET has learnt.

After many false starts, the Maharashtra government and Foxconn are likely to sign a deal under which the world’s biggest contract manufacturer of consumer electronics will finally set up a manufacturing hub in the state. Executives of Taiwan-based Foxconn held meetings with state government officials on July 4 in Nagpur and subsequently went on to meet Maharashtra chief minister Devendra Fadnavis, ET has learnt. 

Foxconn, the assembler of iPhones, has told the state that its plant will be set up in the special economic zone of the Jawaharlal Nehru Port Trust and that it has already bid for 45 acres there, according to sources. Foxconn officials said that they would eventually need another 200 acres. 

Sensing the company’s intent this time, Fadnavis has written to road transport & highways minister Nitin Gadkari, asking him to allot 200 acres to Foxconn, formally known as Hon Hai Precision Industry. The company is also seeking hundreds of acres of additional land outside JNPT from the state. 

Foxconn said in 2015 that it would invest $5 billion in Maharashtra to set up a plant to make mobile phones and components and help create 50,000 jobs by 2020. While the Taiwanese company makes televisions and Xiaomi and Nokia-branded phones in India at factories in Andhra Pradesh and Tamil Nadu, there’s been little progress in its plans to invest in Maharashtra. 

While top Maharashtra government officials acknowledged that Foxconn’s investment did not materialise even after several announcements in the past, they claim that things are different this time. 


“We would not have written the letter to Mr Gadkari if we were not hopeful of things moving positively. We have met with officials from Foxconn Chairman Terry Gou’s office. If things fall into place, then in August we may even have a ground-breaking ceremony,” a state government official said. 

Sources said Gou is slated to visit India next month, when a formal agreement may be clinched. Signing a deal with Foxconn would be a huge boost for the state government and Fadnavis. 

When the Maharashtra CM signed an MOU with Gou in 2005 for the manufacturing facility, it was considered a coup, given that other Indian states were also trying to attract the company. 

The state government has wooed Foxconn after the initial MOU was signed. Upon learning that Foxconn wanted a waiver of the 11.5% import duty on cell phone parts, the state proposed in February 2017 that it would compensate the Taiwanese company by giving it a grant or subsidy. However, the deal still did not go forward. (Source: Economic Times)

Infosys to create new return form for GST Council

InfosysThe GSTN Group of Ministers (GoM) has asked Infosys to create a new tax return filing form in an effort to simplify I-T returns for businesses. Addressing newspersons at the ninth GSTN GoM meeting, Bihar Deputy Chief Minister Sushil Kumar Modi said taxpayers who file 37 returns a year will file just 13 returns when the new format comes into vogue. “It will be a single-page return form and will be approved by the GST Council in the next few days,” he added.

The GSTN Group of Ministers (GoM) has asked Infosys to create a new tax return filing form in an effort to simplify I-T returns for businesses. Addressing newspersons at the ninth GSTN GoM meeting, Bihar Deputy Chief Minister Sushil Kumar Modi said taxpayers who file 37 returns a year will file just 13 returns when the new format comes into vogue. “It will be a single-page return form and will be approved by the GST Council in the next few days,” he added.

The efforts to simplify the filing of GST returns is seen as a practical approach in the face of mounting criticism over the complexity and time that businesses have to spend on compliance. Further, filing of returns would be done in a staggered manner between the 10th and 20th of each succeeding month, said Sushil Modi. Many businesses found this complex and tedious, and made representations to the government to simplify the tax filing.

“Reporting and maintenance of accounts were a challenge, but this is a good step,” said Ambar Kasliwal, co-founder, BigWin Infotech.
Infosys has been awarded the ₹1,380-crore contract to develop and run GST’s backend system, which initially met with several tech-related glitches. There were additional issues with regard to taxation of several items, which subsequently the government revised (for 200 items). Businesses had also complained about the non-user friendly software through which they had to file returns. “The complexity and ambiguity will be removed, coupled with the time and effort to file would reduce which are positives,” said Bhavik Mehta, founder, FinREQ, a fintech start-up.

Additionally, according to Krupesh Bhatt, co-founder, LegalDesk, the simplification of forms will help in reducing errors and reduce the time to fix complex tax filings. Further, Infosys has also developed a software which can help in identifying large number of tax defaulters while filing GSTR1 and GSTR3B. Sushil Modi said the reports generated by the analytics software will be sent to State governments to take action against defaulters.

So far, the number of returns filed was 12.48 crore and number of payment transactions stands at Rs 4.26 crore, Modi said. In June, GST revenue mop-up rose to ₹95,610 crore when compared to ₹94,016 crore in the previous month, according to Finance Secretary Hasmukh Adhia.

Despite the initial glitches, Modi said that collectively they have addressed the problem and Infosys' performance has been good. However, a few months back, the issues with GSTN glitches came to a head when trader's body CAIT said that the GST portal has brought much harassment and mental agony to traders by its non-smooth functioning and has proved a major roadblock in success of a good taxation system (like GST). The body then had said that will contemplate taking the software major to court if issues are not resolved. Infosys has already denied the allegations as “completely inaccurate”. (Source: The Hindu BusinessLine)

Samsung puts Noida on top with world's biggest mobile factory

Samsung puts Noida on top with world's biggest mobile factoryIn front are open fields with grazing cattle, to the left are under-construction residential societies and to the right is its existing facilty - this where Samsung has set up what is the world's largest mobile factory. Not China or South Korea -- and certainly not the US -- the tag of housing the world's largest mobile factory has straight away put Noida on top of the world manufacturing map when it comes to consumer electronics. The new 35-acre Samsung Electronics facility at Sector 81 in Noida, Uttar Pradesh, will see Prime Minister Narendra Modi and South Korean President Moon Jae-in landing together at a quickly-prepared helipad adjacent to the factory to officially inaugurate it on Monday.

One of the first electronics manufacturing facilities set up in the country in the early 1990s, the plant started by manufacturing TVs in 1997. The current mobile phone manufacturing unit was added in 2005. In June last year, the South Korean giant announced a Rs 4,915 crore investment to expand the Noida plant and, after a year, the new facility is ready to double production.

The company is currently making 67 million smartphones in India and with the new plant being functional, it is expected to manufacture nearly 120 million mobile phones. Not just mobiles, the expansion of the current facility will double Samsung's production capacity of consumer electronics like refrigerators and flat panel televisions, further consolidating the company's leadership in these segments.

According to Tarun Pathak, Associate Director at Counterpoint Research, the new facility gives Samsung an advantage by reducing the time to market. "This will help Samsung bring some local features to the devices powered by R&D here. Apart from this, the company can also bring in export opportunity for Samsung to SAARC and other regions," Pathak told IANS.

Samsung has two manufacturing plants -- in Noida and in Sriperumbudur, Tamil Nadu -- five R&D centres, and one design centre in Noida, employing over 70,000 people and expanding its network to over 1.5 lakh retail outlets. Established in 1995, Samsung India laid the foundation stone of Noida plant next year. In 1997, production commenced and the first television was rolled out. In 2003, refrigerator production began.

By 2005, Samsung had become market leader in panel TVs and in 2007, the existing Noida facility started manufacturing mobile phones. In 2012, Samsung became the leader in mobile phones in the country and the Noida facility rolled out the first-ever "Galaxy S3" device. Today, Samsung is the market leader across mobile segments.

The company currently has over 10 per cent of its overall production in India and aims to take it to 50 per cent over the next three years. "For Samsung, India is among the top five smartphone markets globally. The US is saturated and Korea and Brazil are not growing significantly. India is a big opportunity across price segments, including 2G feature phones. It makes sense for Samsung to build a bigger manufacturing base here," Jaipal Singh, Senior Market Analyst, IDC, told IANS.

"They are now looking at building a complete ecosystem. After smartphones, they can go into building top-of-the-line products in other categories like TVs, refrigerators as advance manufacturing in India still lags behind. With the new facility, Samsung is going to have an edge over its rivals," Singh noted. According to HC Hong, President and CEO, Samsung India, a bigger manufacturing plant will help them cater to the growing demand for Samsung products across the country.

Samsung India, that registered 27 per cent growth in mobile business revenue for the financial year 2016-17 -- accounting for a whopping Rs 34,300 crore of its reported Rs 50,000 crore sales - won't be able to hide the smile when the new facility kicks off production from July 9. (Source: Economic Times)
IBM spots a Rs 5,000-cr opportunity in agritech

IBM spots a Rs 5,000-cr opportunity in agritechGlobal IT major IBM is looking at technological inputs for the farm sector to be a Rs 5,000-crore opportunity in the next five years, according to a senior official.
“IBM sees a Rs 5,000-crore opportunity from agritech in India over the next five years,” Himanshu Goyal, India sales and alliances leader, The Weather Company, which is an IBM division, told PTI here.
The revenue will come from providing both business services and advisory for the entire agriculture ecosystem or agriculture value chain on weather data, big data, the Internet of things, blockchain, analytics and artificial intelligence services, he said.

The Weather Company, which is a unit of the IBM, recently tied up with the NITI Aayog for piloting certain solutions for the farm sector using technological interventions, Goyal said, adding his company already works with 70 startups engaged in the agritech sector.
Without divulging any numbers, Goyal said agriculture contributes a sizeable part of the revenue for The Weather Company in the country at present.

It can be noted that around 60 per cent of the countrys over 1.3 billion population depends on agricultural or allied activities, but contributes only about 15 per cent to GDP, resulting in government introducing a slew of targeted programmes for the sector.
The government is targeting to double the farmer income by 2022.

Through its partners, the company is reaching out to up to 35 lakh farmers in the country now.

At present, there are only 6,000 developers devoted to the agricultural sector in the country, which is only 1 per cent of the overall number of developers, he said.

The company is investing in course-ware and other content with live projects to help over 100 educational bodies, including universities and institutes devoted to engineering and management, to upgrade the agritech skills, Goyal said.

He said the project with Niti Aayog involves developing crop-yield prediction model using artificial intelligence to provide real-time advisories to farmers in backward districts.

The company covers 15 agrarian states and has developed “models” for most of the key crops, he concluded. (Source: The Hindu BusinessLine)
OnMobile Global bets big on mobile gaming to drive growth

OnMobile Global bets big on mobile gaming to drive growthMobile value added services firm OnMobile Global is banking on video and gaming to be its growth drivers. Listed on both the NSE and the BSE, the Bengaluru-based company has a presence in over 50 countries and focusses on providing mobile ringback tones (popularly called Caller Tunes), video and infotainment services – such as horoscope and quiz contests.
The company reported a consolidated turnover of ₹636 crore in FY18 and a net profit of about ₹11 crore.
According to Ganesh Murthy, CFO, OnMobile is planning to launch its mobile games (for mobile phones and tablets) — ‘ONMO’ Games — in India, within this fiscal.

So far, it has tied up with Telefonica to launch its mobile games in Spain, with monthly subscription charges of around €5-10 (₹400-800).

“Mobile gaming has long-term potential (in India). We are in talks with almost all telecom companies here. Over the next few months we may look at launches,” he told BusinessLine. Compared to developed and developing economies like Japan, the US and China, where the market size is over $11 billion, app-based gaming (or mobile gaming) is still a nascent market in India. It is expected to be worth $50 million soon in India.

“We may also look at acquiring a gaming platform if the need arises,” he said.

Revenue model

In India, OnMobile could explore the telco-billing model (where the billing for game purchases and otherwise will be done by the telco and charged to the user’s bill).

Like all app-based games, options like in-game purchases; part free-part pay per use model and so on are also being explored. “We are exploring various models specifically targeting the Indian market,” Murthy said.

Once the model stabilises, OnMobile is looking at around $20-30 million (₹135-200 crore) annual revenues from the segment.

Other growth drivers

Other than mobile games, OnMobile has targeted video as the other growth driver. It is tying up with content providers and making investments towards ensuring higher returns from this segment. Focus on regional content is one such area which the company intends to tap.

François-Charles Sirois the President and Chief Executive Officer, OnMobile Systems Inc, during a recent investor call, maintained that the company was working towards launching a new regional video service with local language content. The service is expected to be launched in India, Bangladesh and West Asia, in the coming weeks.(Source: The Hindu BusinessLine)

Vodafone to invest Rs 8,000 cr in India

Vodafone to invest Rs 8,000 cr in IndiaBritish telecom major Vodafone plans to invest €1 billion or about ₹8,000 crore in the proposed joint venture with Idea Cellular that is expected to be in place this month, according to its annual report. The British telecom operator will look at monetising its stake in Indus Towers if it requires to make additional investment in India in case Aditya Birla group decides to put in additional fund in the proposed merged entity--Vodafone Idea Limited.

British telecom major Vodafone plans to invest €1 billion or about ₹8,000 crore in the proposed joint venture with Idea Cellular that is expected to be in place this month, according to its annual report. The British telecom operator will look at monetising its stake in Indus Towers if it requires to make additional investment in India in case Aditya Birla group decides to put in additional fund in the proposed merged entity--Vodafone Idea Limited.

“Idea’s equity raise of €0.8 billion in January 2018, which Vodafone Group will match at the time the merger closes; combined with other adjustments, we currently estimate a net capital injection into India of up to €1 billion at closing in June 2018,” Vodafone Chief Financial Officer Nick Read said in the annual report. The merger of Vodafone with Idea is in the last leg of government approval in which the British firm is expected to have not more than 47.5 per cent stake.

The merged entity will be the largest telecom operator in India with subscriber base of around 430 million. The company’s financial leverage is currently high on a pro-forma basis. In the event that in the future the joint venture partners decide to put in additional funding, the Group would draw upon the value of its stake in Indus Towers,” Vodafone said.

The company has 42 per cent stake in India’s largest mobile tower firm Indus Towers. Indus Towers paid dividends of 138 million euro to the Vodafone Group during 2017-18. On April 25, 2018, Vodafone, Bharti Airtel Limited and Idea announced the merger of Indus Towers into Bharti Infratel.

Bharti Airtel and Vodafone will jointly control the combined company and Vodafone will be issued 783.1 million new shares in the combined company, in exchange for its shareholding in Indus Towers. The Indus Tower -Bharti Infratel deal has given Idea Group the option to sell its full 11.15 per cent shareholding in Indus Towers for cash which would be equivalent to a 29.4 per cent shareholding in the combined company. (Source: The Hindu BusinessLine)

Patanjali ties up with BSNL, launches SIM cards

Patanjali ties up with BSNL, launches SIM cards"There are five lakh counters of BSNL and from there people can soon get Patanjali swadeshi-samradhi card," Ramdev said.
After becoming India's most trusted Fast Moving Consumer Goods brand, Yoga guru Baba Ramdev's Patanjali on Sunday entered the telecom sector. At an event, Baba Ramdev launched Swadeshi Samriddhi SIM cards, in alliance with Bharat Sanchar Nigam Limited (BSNL). Initially, only the employees and office bearers of Patanjali will be able to avail the benefits of the SIM card. After its full-fledged launch, people will get discount of 10 per cent on Patanjali products with this card.

Just with the recharge of Rs 144, one would be able to make unlimited calls across the country, get 2 GB data pack and send 100 SMSs.

Apart from this, people will also get health, accidental and life insurances. Speaking on the occasion, Ramdev said government-owned BSNL is a 'Swadeshi network' and the motive of both Patanjali and BSNL is the welfare of the country.

"There are five lakh counters of BSNL and from there people can soon get Patanjali swadeshi-samradhi card," Ramdev said.
Talking about the company's motive "prosperity for charity", he further said that in addition to attractive data and call package, the card also comes with the medical and life insurance covers of Rs 2.5 lakh and Rs 5 lakh, respectively.

However, the covers could only be availed in the case of road accident. Sunil Garg, BSNL Chief General Manager, who was also present here also praised the tie-up of Patanjali and BSNL. "Patanjali's plan is BSNL's best plan. In Rs 144, one can make unlimited calls from any part of the country. We are giving 2 GB data pack, 100 SMSs. The members of the Patanjali has to just show their identity and there SIM will be activated soon after some paper work," he said. (ANI)(Business Standard)

Sony to make more smartphones and televisions in India

Sony to make more smartphones and televisions in IndiaSony India, the local arm of Japan’s leading consumer electronics maker, has decided to step up ‘Make in India’ for televisions and smartphones instead of relying largely on imports, as it did earlier, in view of the government’s move to increase taxes on overseas products.

The company’s parent in Tokyo is in the process of finalising whether to expand third-party manufacturing or set up a plant in India, said Sony India managing director Sunil Nayyar.

“We are in touch with Tokyo on how to further strengthen ‘Make in India’. As of now, we are happy with our third-party manufacturing and quality of products which has negligible return rates. A large portion of our portfolio will move towards local production which will be a win-win situation for the brand, consumers and government,” said Nayyar, the first Indian to lead local operations, who took charge in April.

India has in the past five months increased import duties on completely built television sets and smartphones to 20% from 15% and 10% respectively. It has also increased import duties on components for both these products. While the tax on finished LED TV panels imported for local assembling is 15%, import duty is 5% on open cell TV panels which require further assembling before being used for production. There is 10-15% import duty on smartphone components such as camera modules, printed circuit boards, chargers, batteries, speakers and keypads.

Sony had started manufacturing of entry-level televisions in 2015 at the Foxconn plant in India, while last year it extended the partnership to manufacture two mid-segment smartphone models. Over time, the company has increased local production to TV units of up to 55-inches, and Nayyar said the company will expand production to include more models. He said Sony has not increased television prices despite the increase in duties, absorbing the burden and insulating customers in the process.

“We would rather focus on premium segment which will boost profitability. Hence, in television the focus will be on 55-inch and above models, while we will not enter the sub-Rs 10,000 smartphone segment,” he said. (Source: Economic Times)

ShareChat valuation may hit $400 million in new round

ShareChat valuation may hit $400 million in new round In what will be the most hotly contested investment deal in a startup, over half a dozen top global financial and strategic investors like We-Chat owner Tencent, South African media firm Naspers, investment firms DST Global, Hillhouse Capital and Morningside Ventures, US-based e-commerce giant Amazon and Chinese online media players Toutiao and Kwai, among others, are in talks to invest in regional language social platform ShareChat, according to three sources familiar with the matter. The deal is expected to increase the valuation of the startup 4-5 times to $400 million in less than six months after it raised funds from Chinese smartphone maker Xiaomi and venture capital firm Shunwei late last year, said these sources.

The three-year-old startup had raised the funds at $75 million valuation. The high investor interest in ShareChat underlines how digital media and social networks targeting the new internet users is becoming the next big theme as funding environment picks up again. “ShareChat is in talks to raise about $100 million in funding and existing investors like Xiaomi and Shunwei are also expected to invest in this round,” said one of the sources mentioned above.

The startup has still not finalised which investors will participate in the round, said the source, adding that a deal will take some time to finalise. ShareChat is likely to bring two new investors on board. ShareChat has been founded by IIT-Kanpur alumni Ankush Sachdeva, Farid Ahsan and Bhanu Singh in October 2015. The startup has raised about $24 million till now and its other investors include SAIF Partners, India Quotient and Lightspeed Venture Partners.

Its growth has been impressive over the last few months as cheap data has increased the time spent on the internet by users, especially those who are more comfortable in vernacular languages. “In the last two quarters the number of daily active users on the platform has increased from 1 million to 5 million with zero marketing,” said the second source mentioned above.

ShareChat co-founder Ahsan declined to comment when contacted by ET and did not reply to an email query. Tencent, Amazon, Toutiao, Kwai, Hillhouse, DST Global, Morningside and Naspers did not revert to an email query from ET.

STARTUP FUNDING UP

The company’s funding round comes close on the heels of ET reporting last month that capital deployed across series A, B and C funding into startups surged 73% year-onyear to $850 million in March quarter, and the number of deals rose 30% to 76, show data from Tracxn. This comes as funding at seed stage continues to be slow, but has started to pick up as overall number of startups increase in the market.

VC investors are moving aggressively to close the deals as they see interest from global strategic investors such as China’s Tencent and Alibaba and South Africa’s Naspers for follow-on investments. Some other companies which are raising capital in quick succession include food delivery application Swiggy.

Several digital media companies which have recently raised funding till now or are in talks to raise funding include Dailyhunt and Newsdog, which have seen interest from Alibaba and Tencent, respectively. Messaging application Hike already counts SoftBank, Tencent and Foxconn as investors.

ENTRY INTO MICRO-MARKETS

The startup is aiming to double its base of daily active users to 10 million and go deeper into micromarkets, including the Northeast region, before it begins working on monetising its service in 2019. The company will look at advertising, influencer marketing and in-app purchases next year. ShareChat has launched an anonymous chat option, direct messaging and other features to increase user activity.

Over 65% of the company’s user base is made up of people in the 14 to 22 age group, while the rest are older. At present, an average user spends about 17 sessions on the application per week. (Source: Economic Times)

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